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EX-10.4 - EX-10.4 - HARLAND CLARKE HOLDINGS CORP | y04346exv10w4.htm |
EX-10.3 - EX-10.3 - HARLAND CLARKE HOLDINGS CORP | y04346exv10w3.htm |
EX-10.5 - EX-10.5 - HARLAND CLARKE HOLDINGS CORP | y04346exv10w5.htm |
EX-10.2 - EX-10.2 - HARLAND CLARKE HOLDINGS CORP | y04346exv10w2.htm |
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): January 6, 2011 (January 1, 2011)
HARLAND CLARKE HOLDINGS CORP.
(Exact Name of Registrant as Specified in its Charter)
Delaware | 333- 133253 | 84-1696500 | ||
(State or Other Jurisdiction of Incorporation |
(Commission File Number) |
(IRS Employer Identification No.) |
10931 Laureate Drive, San Antonio, Texas 78249
(Address of Principal Executive Offices) (Zip Code)
(Address of Principal Executive Offices) (Zip Code)
(210) 694-8888
(Registrants Telephone Number, Including Area Code)
(Registrants Telephone Number, Including Area Code)
Not
Applicable
(Former Name or Former Address, if Changed Since Last Report)
(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):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
TABLE OF CONTENTS
Table of Contents
Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On January 1, 2011, M&F Worldwide Corp. (M&F Worldwide) and its wholly owned subsidiary,
Harland Clarke Holdings Corp. (the Company) entered into an amended and restated employment
agreement (the Dawson Agreement) with Charles T. Dawson (the current President and Chief
Executive Officer of the Company and a member of the Board of Directors of M&F Worldwide). The
Dawson Agreement supersedes, effective January 1, 2011, the previous employment agreement with the
Company and its subsidiaries. Pursuant to the Dawson Agreement, Mr. Dawson will continue to serve
as the President and Chief Executive Officer of the Company and the Chief Executive Officer of the
Harland Clarke Business (as defined in the Dawson Agreement) until December 31, 2013, subject to
earlier termination as described below. Under his employment agreement Mr. Dawsons annual base
salary is $1,050,000. He is entitled to receive an annual bonus based on the attainment of a
certain percentage of consolidated EBITDA (as defined in the Dawson Agreement) of the Company. His
target annual bonus is 125% of base salary and increases ratably up to a maximum of 175% of his
base salary if 145.1% of the targets are attained. He will also receive an award under the
Companys new long term incentive plan (New LTIP) as described below.
If the employment agreement is terminated for cause (as defined in the Dawson Agreement), Mr.
Dawson will not be entitled to any further compensation. In the case of termination of employment
of Mr. Dawson by the Company without cause or by Mr. Dawson for good reason (as defined in the
Dawson Agreement), Mr. Dawson will be entitled to receive: (i) an amount equal to two times his
base salary payable in installments in accordance with the Companys normal payroll practices, (ii)
continued contribution by the Company of the employer portion of premiums for group health plans
for a period of 12 months post termination, (iii) the annual bonus for the year of termination if
Mr. Dawson would be eligible to receive such bonus had he remained employed, provided that such
bonus, if any, shall be payable at the time bonuses are paid to other active employees, (iv) annual
bonus for the year prior to the year the termination occurred, if at the time of such termination
he had earned such bonus but it was not yet paid and (v) amounts payable, if any, under the New
LTIP, in accordance with the terms of the New LTIP. The payments and benefits set forth above are
subject to Mr. Dawsons execution of a release of claims in favor of the Company and its
affiliates. Following the termination of employment Mr. Dawson is subject to a two year
non-compete and non-solicit covenant. If the Company is unwilling to extend the term after
December 31, 2013 (other than as a result of cause, death or disability), then upon termination of
Mr. Dawsons employment, he will be entitled to receive the greater of (a) 50% of the amounts set
forth in (i) and (ii) above or (b) severance and benefits in accordance with Company policy, and
the non-compete and non-solicit covenant shall be reduced to a one year period.
The foregoing is only a summary of certain terms of Mr. Dawsons agreement which is qualified
in its entirety by Exhibit 10.1 incorporated by reference herein.
On January 1, 2011, the Company entered into an amended and restated employment agreement (the
Fera Agreement) with Peter A. Fera, Jr. (the current Executive Vice President and Chief Financial
Officer of the Company). The Fera Agreement supersedes, effective January 1, 2011, the previous
employment agreement with the Company and its subsidiaries. Pursuant to the Fera Agreement, Mr.
Fera will continue to serve as the Executive Vice President and Chief Financial Officer of the
Company until December 31, 2013, subject to earlier termination as described below. Under his
employment agreement Mr. Feras annual base salary is $468,000. He is entitled to receive an annual
bonus based on the attainment of a certain percentage of consolidated EBITDA (as defined in the
Fera Agreement) of the Company. His target annual bonus is 100% of base salary and increases
ratably up to a maximum of 150% of his base salary if 145.1% of the targets are attained. He will
also receive an award under the New LTIP as described below.
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If the employment agreement is terminated for cause (as defined in the Fera Agreement), Mr.
Fera will not be entitled to any further compensation. In the case of termination of employment of
Mr. Fera by the Company without cause or by Mr. Fera for good reason (as defined in the Fera
Agreement), Mr. Fera will be entitled to receive: (i) an amount equal to one and a half times his
base salary payable in installments in accordance with the Companys normal payroll practices, (ii)
continued contribution by the Company of the employer portion of premiums for group health plans
for a period of 12 months post termination, (iii) a pro rata annual bonus for the year of
termination if Mr. Fera would be eligible to receive such bonus had he remained employed, provided
that such bonus, if any, shall be payable at the time bonuses are paid to other active employees,
(iv) annual bonus for the year prior to the year the termination occurred, if at the time of such
termination he had earned such bonus but it was not yet paid and (v) amounts payable, if any, under
the New LTIP, in accordance with the terms of the New LTIP. The payments and benefits set forth
above are subject to Mr. Feras execution of a release of claims in favor of the Company and its
affiliates. Following the termination of employment Mr. Fera is subject to a two year non-compete
and non-solicit covenant. If the Company is unwilling to extend the term after December 31, 2013
(other than as a result of cause, death or disability), then upon termination of Mr. Feras
employment, he will be entitled to receive the greater of (a) 50% of the amounts set forth in (i)
and (ii) above or (b) severance and benefits in accordance with Company policy, and the non-compete
and non-solicit covenant shall be reduced to a one year period.
The foregoing is only a summary of certain terms of Mr. Feras agreement which is qualified in
its entirety by Exhibit 10.2 attached hereto and incorporated by reference herein.
On January 1, 2011, the Company entered into an amended and restated employment agreement (the
Singleton Agreement) with Daniel Singleton (the current President and Chief Operating Officer of
the Harland Clarke Business). The Singleton Agreement supersedes, effective January 1, 2011, the
previous employment agreement with the Company and its subsidiaries. Pursuant to the Singleton
Agreement, Mr. Singleton will continue to serve as the President and Chief Operating Officer of the
Harland Clarke Business until December 31, 2013, subject to earlier termination as described below.
Under his employment agreement Mr. Singletons annual base salary is $520,000. He is entitled to
receive an annual bonus based on the attainment of a certain percentage of consolidated EBITDA (as
defined in the Singleton Agreement) of the Harland Clarke Business. His target annual bonus is 100%
of base salary and increases ratably up to a maximum of 150% of his base salary if 145.1% of the
targets are attained. He will also receive an award under the New LTIP as described below.
If the employment agreement is terminated for cause (as defined in the Singleton Agreement),
Mr. Singleton will not be entitled to any further compensation. In the case of termination of
employment of Mr. Singleton by the Company without cause or by Mr. Singleton for good reason (as
defined in the Singleton Agreement), Mr. Singleton will be entitled to receive: (i) an amount
equal to two times his base salary payable in installments in accordance with the Companys normal
payroll practices, (ii) continued contribution by the Company of the employer portion of premiums
for group health plans for a period of 12 months post termination, (iii) an annual bonus for the
year of termination if Mr. Singleton would be eligible to receive such bonus had he remained
employed, provided that such bonus, if any, shall be payable at the time bonuses are paid to other
active employees, (iv) annual bonus for the year prior to the year the termination occurred, if at
the time of such termination he had earned such bonus but it was not yet paid and (v) amounts
payable, if any, under the New LTIP, in accordance with the terms of the New LTIP. The payments and
benefits set forth above are subject to Mr. Singletons execution of a release of claims in favor
of the Company and its affiliates. Following the termination of employment Mr. Singleton is
subject to a two year non-compete and non-solicit covenant. If the Company is unwilling to extend
the term after December 31, 2013 (other than as a result of cause, death or disability), then upon
termination of Mr. Singletons employment, he will be entitled to receive the greater of (a) 50% of
the amounts set forth in (i) and (ii) above or (b) severance and benefits in accordance with
Company policy, and the non-compete and non-solicit covenant shall be reduced to a one year period.
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The foregoing is only a summary of certain terms of Mr. Singletons agreement which is
qualified in its entirety by Exhibit 10.3 attached hereto and incorporated by reference herein.
On January 1, 2011, the Company and Harland Financial Solutions, Inc., a wholly owned
subsidiary of the Company (HFS), entered into an amended and restated employment agreement (the
Shivdasani Agreement) with Raju Shivdasani (the current President of HFS). The Shivdasani
Agreement supersedes, effective January 1, 2011, the previous employment agreement with the Company
and its subsidiaries. Pursuant to the Shivdasani Agreement, Mr. Shivdasani will continue to serve
as the President of HFS until December 31, 2013, subject to earlier termination as described below.
Under his employment agreement Mr. Shivdasanis annual base salary is $450,000. He is entitled to
receive an annual bonus based on the attainment of a certain percentage of consolidated EBITDA (as
defined in the Shivdasani Agreement) of HFS. His target annual bonus is 100% of base salary and
increases ratably up to a maximum of 150% of his base salary if 145.1% of the targets are attained.
He will also receive an award under the New LTIP as described below.
If the employment agreement is terminated for cause (as defined in the Shivdasani Agreement),
Mr. Shivdasani will not be entitled to any further compensation. In the case of termination of
employment of Mr. Shivdasani by the Company without cause or by Mr. Shivdasani for good reason (as
defined in the Shivdasani Agreement), Mr. Shivdasani will be entitled to receive: (i) an amount
equal to two times his base salary payable in installments in accordance with the Companys normal
payroll practices, (ii) continued contribution by the Company of the employer portion of premiums
for group health plans for a period of 12 months post termination, (iii) an annual bonus for the
year of termination if Mr. Shivdasani would be eligible to receive such bonus had he remained
employed, provided that such bonus, if any, shall be payable at the time bonuses are paid to other
active employees, (iv) annual bonus for the year prior to the year the termination occurred, if at
the time of such termination he had earned such bonus but it was not yet paid and (v) amounts
payable, if any, under the New LTIP, in accordance with the terms of the New LTIP. The payments and
benefits set forth above are subject to Mr. Shivdasanis execution of a release of claims in favor
of the Company and its affiliates. Following the termination of employment Mr. Shivdasani is
subject to a two year non-compete and non-solicit covenant. If the Company is unwilling to extend
the term after December 31, 2013 (other than as a result of cause, death or disability), then upon
termination of Mr. Shivdasanis employment, he will be entitled to receive the greater of (a) 50%
of the amounts set forth in (i) and (ii) above or (b) severance and benefits in accordance with
Company policy, and the non-compete and non-solicit covenant shall be reduced to a one year period.
The foregoing is only a summary of certain terms of Mr. Shivdasanis agreement which is
qualified in its entirety by Exhibit 10.4 attached hereto and incorporated by reference herein.
On January 1, 2011, the Company and Scantron Corporation, a wholly owned subsidiary of the
Company (Scantron), entered into an amended and restated employment agreement (the Hansen
Agreement) with William D. Hansen (Chairman of Scantron). The Hansen Agreement supersedes,
effective January 1, 2011, the previous employment agreement with the Company and its subsidiaries
pursuant to which Mr. Hansen served as the President of Scantron. Pursuant to the Hansen
Agreement, Mr. Hansen will serve as the Chairman of Scantron until December 31, 2013, subject to
earlier termination as described below. Under his employment agreement Mr. Hansens annual base
salary is $442,000. He is entitled to receive an annual bonus based on the attainment of a certain
percentage of consolidated EBITDA (as defined in the Hansen Agreement) of Scantron. His target
annual bonus is 75% of base salary and increases ratably up to a maximum of 112.5% of his base
salary if 145.1% of the targets are attained. He will also receive an award under the New LTIP as
described below.
If the employment agreement is terminated for cause (as defined in the Hansen Agreement), Mr.
Hansen will not be entitled to any further compensation. In the case of termination of employment
of Mr.
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Table of Contents
Hansen by the Company without cause or by Mr. Hansen for good reason (as defined in the Hansen
Agreement), Mr. Hansen will be entitled to receive: (i) an amount equal to two times his base
salary payable in installments in accordance with the Companys normal payroll practices, (ii)
continued contribution by the Company of the employer portion of premiums for group health plans
for a period of 12 months post termination, (iii) a pro rata annual bonus for the year of
termination if Mr. Hansen would be eligible to receive such bonus had he remained employed,
provided that such bonus, if any, shall be payable at the time bonuses are paid to other active
employees, (iv) annual bonus for the year prior to the year the termination occurred, if at the
time of such termination he had earned such bonus but it was not yet paid and (v) amounts payable,
if any, under the New LTIP, in accordance with the terms of the New LTIP. The payments and benefits
set forth above are subject to Mr. Hansens execution of a release of claims in favor of the
Company and its affiliates. Following the termination of employment Mr. Hansen is subject to a two
year non-compete and non-solicit covenant. If the Company is unwilling to extend the term after
December 31, 2013 (other than as a result of cause, death or disability), then upon termination of
Mr. Hansens employment, he will be entitled to receive the greater of (a) 50% of the amounts set
forth in (i) and (ii) above or (b) severance and benefits in accordance with Company policy, and
the non-compete and non-solicit covenant shall be reduced to a one year period.
The foregoing is only a summary of certain terms of Mr. Hansens agreement which is qualified
in its entirety by Exhibit 10.5 attached hereto and incorporated by reference herein.
The Compensation Committee of the Board of Directors of M&F Worldwide has approved a new long
term incentive plan (New LTIP) and the New LTIP will be submitted for shareholder approval in
connection with the next Annual Meeting of M&F Worldwide. Subject to the approval of the New LTIP
by shareholders of M&F Worldwide, the Company has granted awards to certain executives of the
Company and its subsidiaries, including the executives in the table set forth below. The awards
will provide for a cash payment at the end of the three-year period ending December 31, 2013 and
the executives will be entitled to payments in the amounts set forth in the table below assuming
targets are achieved at the end of such three-year period. Each award will be based 75% on
cumulative EBITDA-related targets and 25% on cumulative non-check revenue targets (as more fully
set forth in the award agreements). If less than 90% of the target is achieved, then no payment
will be made. If between 90% and 100% of the targets are achieved, then the amount of the award in
the table below will be adjusted based on linear interpolation between 50% up to 100%, and if
between 100% and 110% of the targets are achieved, then the amount of the award in the table below
will be adjusted based on linear interpolation between 100% up to a maximum of 150%. For Mr. Dawson
and Mr. Fera, the awards and related payments will be based solely on Company results and for
Messrs. Singleton, Hansen and Shivdasani, 50% will be based on Company results and 50% will be
based on the results of their respective business segment.
Aggregate Target | ||||
Executive | Amount (at end of 2013) | |||
Mr. Dawson |
$ | 4,050,000 | ||
Mr. Fera |
$ | 1,350,000 | ||
Mr. Singleton |
$ | 1,800,000 | ||
Mr. Shivdasani |
$ | 1,500,000 | ||
Mr. Hansen |
$ | 1,275,000 |
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The foregoing is only a summary of certain terms of the award agreements which is qualified in its
entirety by the award agreements.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits.
Exhibit 10.1
|
Employment Agreement, dated as of January 1, 2011, by and among M&F Worldwide Corp., Harland Clarke Holdings Corp. and Charles Dawson (incorporated by reference to Exhibit 10.1 to M & F Worldwide Corp.s Form 8-K filed on January 6, 2011). | |
Exhibit 10.2
|
Employment Agreement, dated as of January 1, 2011, between Harland Clarke Holdings Corp. and Peter Fera. | |
Exhibit 10.3
|
Employment Agreement, dated as of January 1, 2011, between Harland Clarke Holdings Corp. and Daniel Singleton. | |
Exhibit 10.4
|
Employment Agreement, dated as of January 1, 2011, by and among Harland Clarke Holdings Corp., Harland Financial Solutions, Inc. and Raju Shivdasani. | |
Exhibit 10.5
|
Employment Agreement, dated as of January 1, 2011, by and among Harland Clarke Holdings Corp., Scantron Corporation and William D. Hansen. |
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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 hereunto duly authorized.
HARLAND CLARKE HOLDINGS CORP. |
||||
By | /s/ Peter A. Fera | |||
Name: | Peter A. Fera, Jr. | |||
Title: | Executive Vice President and Chief Financial Officer | |||
Date: January 6, 2011
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INDEX TO EXHIBITS
Exhibit Number | Description | |
Exhibit 10.1
|
Employment Agreement, dated as of January 1, 2011, by and among M&F Worldwide Corp., Harland Clarke Holdings Corp. and Charles Dawson (incorporated by reference to Exhibit 10.1 to M & F Worldwide Corp.s Form 8-K filed on January 6, 2011). | |
Exhibit 10.2
|
Employment Agreement, dated as of January 1, 2011, between Harland Clarke Holdings Corp. and Peter Fera. | |
Exhibit 10.3
|
Employment Agreement, dated as of January 1, 2011, between Harland Clarke Holdings Corp. and Daniel Singleton. | |
Exhibit 10.4
|
Employment Agreement, dated as of January 1, 2011, by and among Harland Clarke Holdings Corp., Harland Financial Solutions, Inc. and Raju Shivdasani. | |
Exhibit 10.5
|
Employment Agreement, dated as of January 1, 2011, by and among Harland Clarke Holdings Corp., Scantron Corporation and William D. Hansen |