UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 1, 2004
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First Keystone Financial, Inc.
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(Exact name of registrant as specified in its charter)
Pennsylvania 000-25328 23-0469351
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
22 West State Street, Media, Pennsylvania 19063
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (610) 892-6210
____________________________
Not Applicable
______________________________________________________________________________
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions (see General Instruction A.2 below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 240.14d-2(b))
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01 Entry into a Material Definitive Agreement
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On December 1, 2004, First Keystone Financial, Inc. (the
"Company") and First Keystone Bank (the "Bank") ("collectively
the "Employers"), the Company's wholly owned subsidiary each
entered into amended and restated employment agreements with
Messrs. Donald S. Guthrie and Thomas M. Kelly. Mr. Guthrie
serves as the Chairman and Chief Executive Officer and the
President and Chief Executive Officer of the Company and the
Bank, respectively. Mr. Kelly serves as President and Chief
Operating Officer and Executive Vice President and Chief
Operating Officer of the Company and the Bank, respectively. The
amended and restated employment agreements are substantially
identical to the agreements they supercede.
Under the terms of the amended and restated agreements, the
Employers agreed to employ Messrs. Guthrie and Kelly each for a
term of three years in their current respective positions. The
term of each employment agreement is extended each year on its
anniversary date for a successive additional one-year period
unless the Employers or the officer, not less than 30 days prior
to the annual anniversary date, elect not to extend the
employment term.
The employment agreements are terminable with or without
cause by the Employers. The officers have no right to
compensation or other benefits pursuant to the employment
agreement for any period after voluntary termination or
termination by the Employers for cause, disability, retirement or
death, provided, however, that (i) in the event that the officer
terminates his employment because of failure of the Employers to
comply with any material provision of the employment agreement or
(ii) the employment agreement is terminated by the Employers
other than for cause, disability, retirement or death, Messrs.
Guthrie and Kelly will be entitled to a cash severance amount
equal to two times their base salary. In addition, Messrs.
Guthrie and Kelly will be entitled to a continuation of benefits
similar to those they are receiving at the time of such
termination for the remaining term of the agreement or until the
officer obtains full-time employment with another employer,
whichever occurs first. If their employment is terminated by the
Employers subsequent to a Change in Control of the Company (as
defined in the agreements) or by the Executive subsequent to a
Change in Control of the Company as a result of certain adverse
actions, Messrs. Guthrie and Kelly will be entitled to a cash
severance amount equal to three time their base salary as well as
continuation of benefits under the same terms as described above.
Messrs. Guthrie's and Kelly's agreements provide that they
will be entitled to the use of an automobile. In addition, in
the event of Messrs. Guthrie's or Kelly's death during the term
of their respective agreements, their estates will receive
payments equal to the amount of compensation due for the
remainder of the term of their agreements at their respective
current salary at the time of their deaths. Mr. Guthrie's
employment agreement also provides for medical insurance coverage
for him and his spouse until he reaches age 72 and that in the
event of his death, his spouse shall be covered under the Bank's
health insurance plan until age 72. Mr. Kelly's employment
agreement also provides medical insurance coverage under such
plan during the term of his agreement for him and the members of
his immediate family and provides for continued coverage for a
period of five years following the termination of his agreement
except if he is terminated for cause.
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The Employers also entered into two-year amended and
restated severance agreements with Mesdames Elizabeth M. Mulcahy
and Carol Walsh effective December 1, 2004. Under the terms of
such severance agreements, the Employers have agreed that in the
event that such officer's employment is terminated as a result of
certain adverse actions that are taken with respect to the
officer's employment following a Change in Control of the
Company, as defined, such officer will be entitled to a cash
severance amount equal to two times her base salary. The term of
each severance agreement shall be extended each year for a
successive additional one-year period unless the Employers or the
officer, not less than 30 days prior to the anniversary date,
elect not to extend the term of the severance agreement.
Each of the employment and severance agreements with the
Employers provides that if the payments and benefits to be
provided thereunder, or otherwise upon termination of employment,
are deemed to constitute a "parachute payment" within the meaning
of Section 280G of the Internal Revenue Code of 1986, as amended
(the "Code"), then the officer would be reimbursed for any excise
tax liability pursuant to Sections 280G and 4999 of the Code and
for any additional income taxes imposed as a result of such
reimbursement. Because the amount of the payments and benefits
that could constitute a parachute payment is dependent upon the
timing, price and structure of any change in control that may
occur in the future, it is not possible at this time to quantify
the severance benefits payable to the officers under the
employment or severance agreements.
A "Change in Control" generally is defined in the employment
and severance agreements to include, among other things, (i) the
acquisition by any person of 20% or more of the Company's
outstanding voting securities, (ii) a change in a majority of the
directors of the Company during any two-year period without the
approval of at least two-thirds of the persons who were directors
of the Company at the beginning of such period and (iii) approval
by the stockholders of the Company of a transaction which results
in the reorganization, merger or consolidation of the Company
other than one in which at least 51% of the equity ownership
interests of the resulting entity are beneficially owned by
persons who immediately prior to such transaction beneficially
owned at least 51% of equity interests of the Company.
For additional information , reference is made to the
employment and severance agreements included as exhibits hereto
and which are incorporated herein by reference thereto.
ITEM 9.01 Financial Statements and Exhibits
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(a) Not applicable.
(b) Not applicable.
(c) Exhibits
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The following exhibit is filed herewith.
Exhibit Number Description
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10.3 Employment Agreement between First
Keystone Financial, Inc. and Donald S.
Guthrie dated December 1, 2004.
10.5 Employment Agreement between First
Keystone Financial, Inc. and Thomas M.
Kelly dated December 1, 2004.
10.6 Severance Agreement between First
Keystone Financial, Inc. and Elizabeth
M. Mulcahy dated December 1, 2004.
10.8 Severance Agreement between First
Keystone Financial, Inc. and Carol Walsh
dated December 1, 2004.
10.12 Employment Agreement between First
Keystone Bank and Donald S. Guthrie
dated December 1, 2004.
10.14 Employment Agreement between First
Keystone Bank and Thomas M. Kelly dated
December 1, 2004.
10.15 Severance Agreement between First
Keystone Bank and Elizabeth M. Mulcahy
dated December 1, 2004.
10.16 Severance Agreement between First
Keystone Bank and Carol Walsh dated
December 1, 2004.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
FIRST KEYSTONE FINANCIAL, INC.
Date: December 7, 2004 By: /s/ Rose M. DiMarco
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Rose M. DiMarco
Chief Financial Officer