Lake Shore Bancorp, Inc., a federally chartered savings institution, has entered into a new employment agreement with its President and CEO, Kim C. Liddell, according to a recent SEC filing. The agreement, effective as of July 16, 2024, establishes an initial three-year term with provisions for annual extensions and sets forth the terms of compensation, benefits, and severance arrangements.
Liddell's annual base salary has been set at $550,000, with potential for increases and performance-based bonuses. Additionally, he will receive an executive perquisites allowance of $26,400 yearly and a $2,500 monthly housing allowance. The agreement also outlines severance benefits in various termination scenarios, including voluntary resignation and involuntary termination with or without cause.
In case of an involuntary termination without cause or resignation for "good reason," Liddell is entitled to a lump sum payment equal to one year of base salary and an average of the three most recent years' cash bonuses. This is contingent upon Liddell signing a release agreement. Furthermore, in the event of a change in control followed by termination, the severance payment increases to three times the sum of his base salary and the highest recent bonus, plus 36 months of life, medical, and dental coverage costs.
Alongside the employment agreement, Lake Shore Savings Bank has approved a supplemental executive retirement plan (SERP) for Liddell, effective April 19, 2023. The SERP provides for payments from annuity contracts after Liddell turns 67, with monthly installments for 15 years and potentially for life. The plan also addresses benefits in cases of disability, death, or a change in control followed by a qualifying termination.
The details of these agreements were sourced from the exhibits attached to the SEC filing, which include the full employment agreement and SERP. These documents contain the comprehensive terms of Liddell's employment and post-employment compensations. The SEC filing by Lake Shore Bancorp serves as the source for this information.
InvestingPro Insights
The recent employment agreement with Lake Shore Bancorp's President and CEO, Kim C. Liddell, comes at a time when the company is experiencing a robust return over the last three months, with a notable 19.35% price total return. Despite a challenging revenue growth environment, as evidenced by a -4.39% decline in the last twelve months as of Q1 2024, Lake Shore Bancorp remains profitable with a P/E ratio of 17.72, indicating investor confidence in its earnings potential. Additionally, the company's return on assets stands at 0.57%, reflecting its ability to generate profits from its assets.
InvestingPro Tips highlight that while Lake Shore Bancorp suffers from weak gross profit margins, it has still managed to yield a strong performance in the short term. For readers interested in a deeper dive into the company's financial health and future prospects, InvestingPro offers additional tips that can be accessed at: https://www.investing.com/pro/LSBK. To enhance your investment strategy, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, unlocking even more valuable insights.
With a market cap of approximately $70.97M and a dividend yield of 5.84%, Lake Shore Bancorp presents an interesting case for investors looking for stability in the form of regular income. The company's price/book ratio of 0.82 further suggests that the stock might be undervalued compared to the book value of its assets. For those considering an investment, Lake Shore Bancorp's next earnings date is slated for July 24, 2024, which could provide additional information on the company's trajectory and the impact of the CEO's new employment terms.
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