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) April 29, 2014 (April 23, 2014)
TORCHMARK CORPORATION
(Exact name of registrant as specified in its charter)
| DELAWARE | 001-08052 | 63-0780404 | ||
|
(State or other jurisdiction of incorporation) |
(Commission File No.) |
(I.R.S. Employer ID No.) |
3700 South Stonebridge Drive, McKinney, Texas 75070
(Address of principal executive offices)
Registrant’s telephone number, including area code: (972) 569-4000
None
(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:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a.-12) |
| ¨ | 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 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
| (b) | Mark S. McAndrew retired from the Board of Directors (Board) of Torchmark Corporation (Torchmark) immediately prior to the convening of the Annual Meeting of Shareholders on April 24, 2014. |
| (c) | On April 23, 2014, the Board of Torchmark elected Gary L. Coleman and Larry M. Hutchison as Co-Chairmen of the Board, effective upon the April 24, 2014 retirement of Chairman Mark S. McAndrew from the Board. Accordingly, immediately prior to the commencement of the Annual Meeting of Shareholders on April 24, 2104, Messrs. Coleman and Hutchison commenced their service as Co-Chairman and Chief Executive Officers of Torchmark. Mr. Coleman (age 61) and Mr. Hutchison (age 60) have served as Torchmark directors since August 2012 and were appointed Torchmark’s Co-Chief Executive Officers (Co-CEOs) effective June 1, 2012. Prior to that time, Mr. Coleman served as Executive Vice President and Chief Financial Officer of Torchmark (Sept. 1999-May 2012) and Mr. Hutchison as Executive Vice President and General Counsel (Sept. 199-May 2012). |
There are no arrangements or understandings between Messrs. Coleman or Hutchison and any other persons pursuant to which they were selected to serve as Co-Chairmen of the Board. Additionally there are no family relationships involving Messrs. Coleman or Hutchison to report under Item 401(d) of Regulation S-K and no related person transactions involving them to report pursuant to Item 404(a) of Regulation S-K.
There were no material plans, contracts or arrangements to which Messrs. Coleman or Hutchison are a party or in which either participates which were entered into or materially amended in connection with their election as Co-Chairmen of the Board nor was any grant or award made to them or any modification of existing grants, awards, plans, contracts or arrangements for either of them in connection herewith. While they continue to be compensated as previously disclosed for their service as Co-CEOs, they receive no compensation for service as Torchmark directors and will receive no compensation for service as Co-Chairmen of the Board, as more fully described in Item 5.02(e) below.
| (e) | On April 24, 2014, the independent directors of Torchmark (with Messrs. Coleman and Hutchison abstaining) amended the Payments to Directors Policy to remove the provisions for payment of an annual Chairman of the Board Retainer in the amount of $50,000 since Torchmark would no longer have a non-executive Chairman of the Board when Gary L. Coleman and Larry M. Hutchison assumed their roles as Co-Chairmen of the Board upon Mark S. McAndrew’s retirement from the Board. |
Also, on April 24, 2014, the shareholders of Torchmark Corporation approved the First Amendment to the Torchmark Corporation 2011 Incentive Plan. A summary of the First Amendment follows.
SUMMARY OF THE FIRST AMENDMENT TO THE 2011 INCENTIVE PLAN
The First Amendment to the Torchmark Corporation 2011 Incentive Plan
| • | increased the maximum authorized shares under the 2011 Plan by 4,200,000 shares from 7,950,000 to 12,150,000 shares; |
| • | removed the allocation of maximum authorized shares between (i) options and SARS with ten-year terms and (ii) options and SARS, with seven-year terms and full-value awards such that all shares available under the 2011 Plan may be granted as options or SARs with terms of up to ten years or full-value awards; |
| • | modified the method to count the shares utilized under the Plan to provide as follows: |
| ¡ | awards of options and SARs with a term of seven years or less count against the number of shares available for issuance under the 2011 Plan as .85 of a share for each share covered by such award; |
| ¡ | awards of options and SARs with a term of eight to ten years count against the number of shares available for issuance under the 2011 Plan as one (1) share for each share covered by such award; |
| ¡ | full value awards that vest based on performance criteria other than continued service count against the number of shares available for issuance under the 2011 Plan as 3.1 shares for each share covered by such award; and |
| ¡ | full value awards that vest solely on continued service count against the number of shares available for issuance under the 2011 Plan as 3.88 shares for each share covered by such award; |
| • | modified the period of time that maximum individual award share limits are measured to provide for measurement “within a single calendar year” rather than “in any 12-month period;” and |
| • | modified the maximum individual award share limits as follows: |
| ¡ | the limitation on options increases from 270,000 to 300,000; |
| ¡ | the limitation on SARS increases from 270,000 to 300,000; |
| ¡ | the limitation on restricted stock or restricted stock units increases from 90,000 to 100,000; and |
| ¡ | the limitation on awards of other stock-based awards increases from 90,000 to 150,000. |
No awards or grants have been made pursuant to the First Amendment to the 2011 Incentive Plan.
| Item 5.07 | Submission of Matters to a Vote of Security Holders. |
(a) Annual Meeting of Shareholders held April 24, 2014
(b) Proposal I – Election of Directors for One Year Terms
| For | Against | Abstain | Broker Non-Vote | |||||||||||||
|
Charles E. Adair |
65,856,642 | 716,790 | 91,395 | 8,421,309 | ||||||||||||
|
Marilyn A. Alexander |
66,444,464 | 125,206 | 95,408 | 8,421,058 | ||||||||||||
|
David L. Boren |
65,579,127 | 977,561 | 108,418 | 8,421,030 | ||||||||||||
|
Jane M. Buchan |
66,421,566 | 140,627 | 102,913 | 8,421,030 | ||||||||||||
|
Gary L. Coleman |
65,931,605 | 615,291 | 117,931 | 8,421,309 | ||||||||||||
|
Larry M. Hutchison |
65,929,338 | 615,515 | 119,974 | 8,421,309 | ||||||||||||
|
Robert W. Ingram |
66,316,027 | 222,050 | 127,001 | 8,421,058 | ||||||||||||
|
Lloyd W. Newton |
66,300,182 | 256,659 | 107,986 | 8,421,309 | ||||||||||||
|
Darren M. Rebelez |
66,266,668 | 252,248 | 145,883 | 8,421,337 | ||||||||||||
|
Lamar C. Smith |
65,490,582 | 911,880 | 262,365 | 8,421,309 | ||||||||||||
|
Paul J. Zucconi |
65,822,058 | 706,657 | 136,391 | 8,421,030 | ||||||||||||
Proposal II -
| For | Against | Abstain | Broker Non-Vote | |||||||||||||
|
Ratification of Deloitte & Touche LLP as Independent Auditor for 2014 |
74,462,751 | 538,263 | 85,122 | 0 | ||||||||||||
Proposal III -
| For | Against | Abstain | Broker Non-Vote | |||||||||||||
|
Approval of First Amendment to 2011 Incentive Plan |
61,296,678 | 5,157,313 | 211,965 | 8,420,180 | ||||||||||||
2
Proposal IV -
| For | Against | Abstain | Broker Non-Vote | |||||||||||||
|
Advisory Approval of 2013 Executive |
64,862,641 | 1,430,026 | 373,289 | 8,420,180 | ||||||||||||
Compensation (Annual “Say-on-Pay”)
(c) Not applicable.
(d) Torchmark will include a shareholder vote on the compensation of executives in its proxy materials each year until the next required vote in 2016 on the frequency with which shareholders will vote on the compensation of executives as disclosed in proxy statements.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits. |
| 10.1 | First Amendment to Torchmark Corporation 2011 Incentive Plan | |
| 10.2 | Payments to Directors |
3
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| TORCHMARK CORPORATION | ||||||||
| Date: April 29, 2014 | ||||||||
|
/s/ Carol A. McCoy |
||||||||
| Carol A. McCoy, | ||||||||
| Vice President, Associate Counsel and | ||||||||
| Corporate Secretary |
4
Exhibit 10.1
FIRST AMENDMENT TO TORCHMARK CORPORATION
2011 INCENTIVE PLAN
Pursuant to the authority granted to the Board of Directors of Torchmark Corporation in Section 16.1 of the Torchmark Corporation 2011 Incentive Plan (the “Plan”) and subject to shareholder approval, the Plan is hereby amended effective on the date shareholder approval is attained as follows:
I.
The Plan is hereby amended by amending and restating Section 5.1 to read in its entirety as follows:
“SECTION 5.1 NUMBER OF SHARES . Subject to adjustment as provided in Sections 5.2 and 15.1, the aggregate number of Shares reserved and available for issuance pursuant to Awards granted under the Plan shall be 12,150,000 Shares, plus a number of additional Shares (not to exceed 529,500) underlying awards outstanding as of the Effective Date under the Company’s 2007 Long-Term Compensation Plan (the “Prior Plan”) that thereafter terminate or expire unexercised, or are cancelled, forfeited or lapse for any reason. The maximum number of Shares that may be issued upon exercise of Incentive Stock Options granted under the Plan shall be 7,950,000. From and after the Effective Date, no further awards shall be granted under the Prior Plan and the Prior Plan shall remain in effect only so long as awards granted thereunder shall remain outstanding.”
II.
The Plan is hereby amended by amending and restating Section 5.2(a) to read in its entirety as follows:
“(a) Awards of Options and Stock Appreciation Rights with a seven-year term shall count against the number of Shares remaining available for issuance pursuant to Awards granted under the Plan as .85 of a Share for each Share covered by such Awards, Options and Stock Appreciation Rights with a term of eight to ten years shall count against the number of Shares remaining available for issuance pursuant to Awards granted under the Plan as one (1) Share for each Share covered by such Awards, Full Value Awards that vest based on performance criteria other than continued service shall count against the number of Shares remaining available for issuance pursuant to Awards granted under the Plan as 3.1 Shares for each Share covered by such Award, and Full Value Awards that vest solely on continued service shall count against the number of Shares remaining available for issuance pursuant to Awards granted under the Plan as 3.88 Shares for each Share covered by such Awards.”
III.
The Plan is hereby amended by amending and restating Section 5.4 to read in its entirety as follows:
“5.4 LIMITATION ON AWARDS . Notwithstanding any provision in the Plan to the contrary (but subject to adjustment as provided in Article 15):
(a) Options . The maximum aggregate number of Shares subject to Options granted under the Plan within a single calendar year to any one Participant shall be 300,000.
(b) SARs . The maximum number of Shares subject to Stock Appreciation Rights granted under the Plan within a single calendar year to any one Participant shall be 300,000.
(c) Restricted Stock or Restricted Stock Units . The maximum aggregate number of Shares underlying Awards of Restricted Stock or Restricted Stock Units under the Plan within a single calendar year to any one Participant shall be 100,000.
(d) Other Stock-Based Awards . The maximum aggregate grant with respect to Other Stock-Based Awards under the Plan within a single calendar year to any one Participant shall be 150,000 Shares.
(e) Cash-Based Awards . The maximum aggregate amount that may be paid with respect to cash-based Awards under the Plan to any one Participant within a single calendar year shall be $4,000,000.”
Except as otherwise provided in this First Amendment, the Torchmark Corporation 2011 Incentive Plan is ratified and confirmed in all respects.
EXECUTED this 24th day of April, 2014.
| TORCHMARK CORPORATION | ||||||
| ATTEST: | ||||||
| /s/ Christopher T. Moore | By: | /s/ Carol A. McCoy | ||||
| Assistant Secretary |
Vice President, Associate Counsel & Corporate Secretary |
|||||
2
Exhibit 10.2
Non-employee directors of the Company are compensated on the following basis:
(1) Cash Compensation—(a) Non-employee directors are paid $90,000 of their annual retainer in cash in quarterly installments unless a timely election is made under the non-employee director sub-plan of the Torchmark Corporation 2011 Incentive Plan, as amended (2011 Plan) to receive an equivalent amount of market value stock options, restricted stock or restricted stock units (RSUs) or to defer the cash to an interest-bearing account under the terms of that sub-plan of the 2011 Plan; (b) The Lead Director receives an additional $30,000 annual retainer in cash, payable in quarterly installments; (c) Annual Board committee chair retainers, payable in quarterly installments in cash, are $22,500 for the Audit Committee Chair and $10,000 for each of the Chairs of the Compensation Committee and the Governance and Nominating Committee; and (d) All members of the Audit Committee (including the Chair) receive an additional annual Audit Committee Member Retainer of $10,000, payable quarterly; and
(2) Equity Compensation—Non-employee directors are paid $100,000 of their annual retainer in equity, either in the form of market value stock options, restricted stock or RSUs, based on the director’s timely election, with the equity issued on the first NYSE trading day of January of each calendar year valued at the NYSE market closing price of Company common stock on that date. If no timely election is made, the non-employee director receives his or her annual equity compensation in the form of $100,000 of market value stock options awarded on the first NYSE trading day of each year.
Non-employee directors do not receive meeting fees or fees for the execution of written consents in lieu of Board meetings or in lieu of Board committee meetings. They receive reimbursement for their travel and lodging expenses if they do not live in the area where a meeting is held.
Pursuant to the non-employee director sub-plan of the 2011 Plan, newly elected non-employee directors receive upon the date of their initial election to the Board $100,000 of restricted stock, valued at the market closing price of Company common stock on that date.
Directors who are employees of Torchmark or its subsidiaries receive no compensation for Board service or for service as Co-Chairmen of the Board.