UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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) June 5, 2014
IMPERIAL HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
| Florida | 001-35064 | 30-0663473 | ||
|
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
|
701 Park of Commerce Boulevard, Suite 301 Boca Raton, Florida |
33487 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number including area code: (561) 995-4200
(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.
(e)
On June 5, 2014, the Compensation Committee of the Board of Directors of Imperial Holdings, Inc. (the “Company”) awarded each of the Company’s directors and named executive officers with performance shares under the Imperial Holdings 2010 Omnibus Incentive Plan (“Plan”). The awards to the Company’s directors and Chief Executive Officer are subject to shareholder approval of an amendment and restatement of the Plan at the Company’s 2015 annual meeting.
The number of shares earned by each of the named executive officers will range from 0-150% of the target award amount, depending on the Company’s financial performance from June 5, 2014 through June 30, 2016 (the “Performance Period”) based on a target (i) book value and (ii) market to book ratio. If performance is below threshold on either metric, no shares will be earned. No shares will be earned by an executive if terminated for any reason during the Performance Period.
The number of shares earned during the Performance Period will be issued to the executive as restricted stock, subject to continued employment for an additional year following the Performance Period until June 30, 2017. In the event of a Change in Control (as defined in the award agreement) of the Company, the performance shares will immediately vest. If the Change in Control occurs during the Performance Period, the number of shares that vest will be the higher of the target amount or the actual projected results. If the Change in Control occurs after the Performance Period, the number of shares that vest will be the number actually earned during the Performance Period.
Each of the directors other than Mr. Mitchell received a target number of 5,000 performance shares. The target number of performance shares awarded to each of our named executive officers is as follows:
|
Name |
Target Number
Performance Shares |
|||
|
Antony Mitchell
|
120,000 | |||
|
Richard O’Connell
|
40,000 | |||
|
Michael Altschuler
|
26,000 | |||
|
Miriam Martinez
|
36,000 | |||
The foregoing summary is not intended to be complete and is qualified in its entirety by reference to the form of performance share award agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference.
Item 5.07 Submission of Matters to a Vote of Security Holders.
The Annual Meeting of Shareholders (“Annual Meeting”) of the Company was held on June 5, 2014. The results of matters submitted to a vote were as follows:
Proposal 1 – Election of Directors. The shareholders elected each of the director nominees set forth below for a one-year term expiring at the next Annual Meeting of Shareholders. The shareholders voted as follows:
| Votes Cast | ||||||||||||
|
Name |
For | Withheld | Broker Non-Votes | |||||||||
|
James Chadwick |
14,412,792 | 290,994 | 4,695,204 | |||||||||
|
Michael Crow |
14,413,985 | 289,801 | 4,695,204 | |||||||||
|
Andrew Dakos |
14,677,985 | 26,691 | 4,695,204 | |||||||||
|
Richard Dayan |
14,413,662 | 290,724 | 4,695,204 | |||||||||
|
Phillip Goldstein |
14,625,661 | 78,125 | 4,695,204 | |||||||||
|
Gerald Hellerman |
14,408,105 | 295,681 | 4,695,204 | |||||||||
|
Antony Mitchell |
14,679,197 | 24,589 | 4,695,204 | |||||||||
Proposal 2 – Advisory Vote on Executive Compensation. The shareholders approved, on an advisory basis, the compensation of the Company’s named executive officers for the fiscal year ended December 31, 2013. The shareholders voted as follows:
| Votes Cast | ||||||
|
For |
Against |
Abstain |
Broker Non-Votes |
|||
| 14,123,391 | 371,464 | 208,931 | 4,695,204 | |||
Proposal 3 – Vote on Common Stock Issuance Upon Conversion of the Company’s 8.50% Senior Unsecured Notes due 2019. The shareholders voted to approve the issuance of the Company’s common stock upon conversion of the Company’s 8.50% Senior Unsecured Convertible Notes due 2019. The shareholders voted as follows:
| Votes Cast | ||||||
|
For |
Against |
Abstain |
Broker Non-Votes |
|||
| 14,586,764 | 97,522 | 19,500 | 4,695,204 | |||
Proposal 4 – Ratification of Grant Thornton LLP as the Company’s Independent Registered Public Accounting Firm. The selection of Grant Thornton LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2014 was ratified by shareholders. The shareholders voted as follows:
| Votes Cast | ||||
|
For |
Against |
Abstain |
||
| 19,324,427 | 51,456 | 23,107 | ||
Item 8.01 Other Events.
On June 5, 2014 and as part of their 2014 director compensation, each of the Company’s non-employee directors were, except as noted below, paid $45,000 through the grant of 7,246 shares of one year vesting restricted stock. The number of shares granted to each such director was determined based on the fair market value of the Company’s common stock on June 4, 2014, the date prior to the Annual Meeting. Directors owning at least $200,000 in fair market value of the Company’s common stock have an option to elect all or a portion of this payment in cash in lieu of restricted stock. Mr. Hellerman elected to receive 4,830 shares of one year vesting restricted stock with the remainder paid in cash.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit 10.1 | Form of Performance Share Award Agreement under the Imperial Holdings 2010 Omnibus Incentive Plan. |
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 hereunto duly authorized.
June 9, 2014
| IMPERIAL HOLDINGS, INC. | ||
| (Registrant) | ||
| By: |
/s/ Michael Altschuler |
|
| Michael Altschuler | ||
| General Counsel and Secretary | ||
EXHIBIT INDEX
|
Exhibit
|
Description |
|
| 10.1 | Form of Performance Share Award Agreement under the Imperial Holdings 2010 Omnibus Incentive Plan. | |
Exhibit 10.1
IMPERIAL HOLDINGS, INC.
2010 OMNIBUS INCENTIVE PLAN
PERFORMANCE SHARE AWARD
[Name]
[Address]
Dear :
[Subject to shareholder approval of the amended and restated Imperial Holdings, Inc. 2010 Omnibus Incentive Plan (the “Plan”) at the Company’s 2015 annual meeting, you are hereby] [You have been] granted an Award under the [Plan][Imperial Holdings, Inc. 2010 Omnibus Incentive Plan (the “Plan”)] with the following terms and conditions:
| Grant Date: | ||
| Performance Period: | Grant Date through | |
| Target Number of Shares Subject to Award (the “Shares”): | ||
| Performance Shares Earned: |
The number of Shares earned based on performance will range from %- % of target depending on the Company’s financial performance over the Performance Period, measured as set forth in Appendix A to this Award.
For performance between the threshold and target, or target and maximum, the number of Shares earned will be interpolated. For performance below threshold, no Shares will be earned. In addition, if your employment or service terminates prior to the end of the Performance Period, no Shares will be earned.
The Committee will determine the Company’s performance and the number of Shares earned as soon as reasonably practicable after the end of the Performance Period and in any event no later than months after the year in which the Performance Period ends.
Any Shares earned based on performance will be issued as Restricted Stock immediately following the Committee’s determination of the Company’s performance and shall remain subject to a risk of forfeiture during the Service Vesting Period (as defined below). |
|
| Service Vesting Period: | through | |
| Vesting or Forfeiture of Shares During the Service Vesting Period: |
During the Service Vesting Period, the Shares will be held in an account at the Company’s transfer agent pending vesting. As soon as practicable after any Shares vest at the end of the Service Vesting Period, the applicable restrictions on the Shares will be removed and the Shares will be released according to your instructions.
If your employment or service terminates during the Service Vesting Period, then:
• If the termination is a result of your death, Disability (as defined below) or a Company-initiated reduction in force at a time when your employment could not otherwise have been terminated for Cause (as defined below), the Shares that were earned based on performance will immediately vest in full.
• If the termination is a result of any other circumstance, then all Shares will be forfeited immediately.
For the purposes of this Award, “Disability” means the determination by the Company, its subsidiaries or affiliates that, as a result of a permanent physical or mental injury or illness, you have been unable to perform the essential functions of your job with or without reasonable accommodation for (i) 90 consecutive days or (ii) a period of 180 days in any 12-month period.
For purposes of this Award, “Cause” shall have the same meaning as set forth in your employment agreement with the Company, or, if you do not have an employment agreement with the Company, “Cause” shall mean a good faith finding by the Company that you have (i) failed, neglected, or refused to perform your lawful employment duties as from time to time assigned to you (other than due to disability); (ii) committed any willful, intentional, or grossly negligent act having the effect of materially injuring the interest, business, or reputation of the Company or any Affiliate; (iii) violated or failed to comply in any material respect with the Company’s published rules, regulations, or policies, as in effect or amended from time to time; (iv) committed an act constituting a felony or misdemeanor involving moral turpitude, fraud, theft, or dishonesty; (v) misappropriated or embezzled any property of the Company or an Affiliate (whether or not an act constituting a felony or misdemeanor); or (vi) breached any material provision of any applicable confidentiality, non-compete, non-solicit, general release, covenant not-to-sue, or other agreement with the Company or an Affiliate. |
2
| Change in Control: |
If you are employed by or in service with the Company or an Affiliate immediately prior to the date of a Change in Control, then:
• If the Change in Control occurs prior to or coincident with the end of the Performance Period, then, effective upon the Change in Control, the greater of (i) the target number of Shares or (ii) the number of Shares that would be earned based on actual performance through the Change in Control will be deemed earned and vested in full. The remainder of this Award will be cancelled.
• If the Change in Control occurs after the Performance Period, then, effective upon the Change in Control, the number of Shares earned based on performance will be deemed vested in full. |
|
| Dividends: | No dividends or dividend equivalents will be credited with respect to this Award during the Performance Period. Dividends and other distributions paid during the Service Vesting Period with respect to the Shares earned based on performance will be accrued and held in the custody of the Company. Such distributions will be subject to the same risk of forfeiture, restrictions on transferability and other terms of this Award that apply to the Shares with respect to which such distributions were made, and will be paid to you within 45 days following the full vesting of the Shares with respect to which such distributions were made. | |
| Voting: | You will have no voting rights with respect to this Award during the Performance Period. During the Service Vesting Period, you will have full voting rights with respect to the Shares earned based on performance to the extent such Shares have not been forfeited prior to the record date for the vote. | |
| Transferability of Award: | You may not transfer or assign this Award for any reason, other than as set forth in the Plan. Any attempted transfer or assignment of this Award, other than as set forth in the Plan, will be null and void. | |
| Market Stand-Off: | In connection with any underwritten public offering by the Company of its equity securities pursuant to an effective registration statement filed under the Securities Act of 1933, as amended, you agree that you shall not directly or indirectly sell, make any short sale of, loan, hypothecate, pledge, offer, grant or sell any option or other contract for the purchase of, purchase any option or other contract for the sale of, or otherwise dispose of or transfer or agree to engage in any of the foregoing transactions with respect to, any Shares acquired under this Award without the prior written consent of the Company. Such restriction shall be in effect for such period of time following the date of the final prospectus for the offering as may be determined by the Company. In no event, however, shall such period exceed one hundred eighty (180) days. | |
3
| Restrictions on Transfer of Shares: | Notwithstanding anything to the contrary herein, no Shares will be issued unless and until the Company has determined to its satisfaction that such issuance will comply with all applicable federal and state securities laws, rules and regulations of the Securities and Exchange Commission, rules of any stock exchange on which shares of the Company’s capital stock may then be traded, or any other applicable laws. In addition, if required by underwriters for the Company, you agree to enter into a lock-up agreement with respect to any Shares acquired or to be acquired under this Award. | |
| Tax Withholding: | To the extent that the vesting or receipt of the Shares, or the payment of dividends or dividend equivalents thereon, results in income to you for Federal, state or local income tax purposes, you shall deliver to the Company at the time the Company is obligated to withhold taxes in connection with such receipt, such amount as the Company requires to meet its withholding obligation under applicable tax laws or regulations, and if you fail to do so, the Company has the right and authority to deduct or withhold from any compensation payable to you, including compensation due under this Award, an amount sufficient to satisfy its withholding obligations. To the extent permitted by the Company, you may satisfy the withholding requirement, in whole or in part, by electing to have the Company withhold for its own account that number of Shares otherwise deliverable to you having an aggregate Fair Market Value on the date the tax is to be determined equal to the minimum statutory total tax that the Company must withhold. Your election must be irrevocable, in writing, and submitted to the Secretary of the Company before the date the Shares are distributed. The Fair Market Value of any fractional Share not used to satisfy the withholding obligation (as determined on the date the tax is determined) will be paid to you in cash. | |
| Recoupment: | If the Committee determines that recoupment of incentive compensation paid to you pursuant to this Award is required under any law or any recoupment policy of the Company, then this Award will terminate immediately on the date of such determination to the extent required by such law or recoupment policy and the Committee may recoup any such incentive compensation in accordance with such recoupment policy or as required by law. The Company shall have the right to offset against any other amounts due from the Company to you any amount owed by you hereunder. | |
| Miscellaneous: |
• This Award may be amended only by written consent signed by both you and the Company, unless the amendment is not to your detriment. Notwithstanding the foregoing, this Award may be amended or terminated by the Board or the Committee without your consent in accordance with the provisions of the Plan. |
|
4
|
• The failure of the Company to enforce any provision of this Award at any time shall in no way constitute a waiver of such provision or of any other provision hereof.
• In the event any provision of this Award is held illegal or invalid for any reason, such illegality or invalidity shall not affect the legality or validity of the remaining provisions of this Award, and this Award shall be construed and enforced as if the illegal or invalid provision had not been included in the Award.
• As a condition to the grant of this Award, you agree (with such agreement being binding upon your legal representatives, guardians, legatees or beneficiaries) that this Award shall be interpreted by the Committee and that any interpretation by the Committee of the terms of this Award or the Plan, and any determination made by the Committee pursuant to this Award or the Plan, shall be final, binding and conclusive.
• This Award may be executed in counterparts. |
This Performance Share Award is granted under and governed by the terms and conditions of the Plan. Additional provisions regarding your Award and definitions of capitalized terms used and not defined in this Award can be found in the Plan.
BY SIGNING BELOW AND ACCEPTING THIS AWARD, YOU AGREE TO ALL OF THE TERMS AND CONDITIONS DESCRIBED HEREIN AND IN THE PLAN. YOU ALSO ACKNOWLEDGE RECEIPT OF A COPY OF THE PLAN.
| IMPERIAL HOLDINGS, INC. | ||||||||
| By: |
|
|
||||||
| [Name of Authorized Officer] | Recipient | |||||||
| Date: |
|
|||||||
5
Appendix A