The foregoing summary of the Cooperation Agreement does not purport to be complete and is subject to, and qualified in its entirety, by the full text of the Cooperation Agreement, which is attached hereto as Exhibit 10.1 and incorporated herein by reference.
A copy of the press release issued by the Company on May 2, 2022 announcing the execution of the Cooperation Agreement and related matters is attached hereto as Exhibit 99.1 and incorporated herein by reference.
| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
The information set forth under Item 1.01 of this Form 8-K is incorporated herein by reference.
Effective as of May 1, 2022, the Board, upon the recommendation of the Board’s Nominating and Governance Committee, increased the size of the Board from eight to nine members and appointed Brent O. Hatch as a Class II director with a term expiring at the Company’s 2022 Annual Meeting to fill the resulting vacancy. Mr. Hatch was also appointed to the Audit Committee, the Investment Oversight Committee, and the Nominating and Governance Committee, and elected as Lead Independent Director, in each case effective immediately upon his appointment to the Board. The Board has determined that Mr. Hatch qualifies as an independent director pursuant to the requirements of the Securities and Exchange Commission (“SEC”) and The NASDAQ Stock Market (“Nasdaq”), including for purposes of the Audit Committee and the Nominating and Governance Committee, and that he qualifies as an “audit committee financial expert” as defined by applicable regulations of the SEC as well as “financially literate” within the meaning of the applicable rules of Nasdaq.
Mr. Hatch is the founder of the law firm of Hatch Law Group, PC and has been employed there and its predecessor firm since 1993, where he litigates complex commercial matters and advises corporations on significant transactions. Mr. Hatch also currently serves as a member of the Board of Directors and the Audit Committee of the Company’s subsidiary, Medallion Bank, and has served in such roles since 2003. Mr. Hatch brings extensive legal experience, having founded a law firm in Utah and having previously served in the White House as Associate Counsel to President George H.W. Bush, Deputy Assistant Attorney General at the U.S. Department of Justice, and General Counsel at the National Endowment for the Humanities. Mr. Hatch clerked for the Honorable Robert H. Bork of the U.S. Court of Appeals for the District of Columbia Circuit. He is also a Director and Treasurer of the Federalist Society. Mr. Hatch holds a bachelor’s degree from Brigham Young University and a J.D. from Columbia Law School.
Mr. Hatch was appointed as a director pursuant to the terms of the Cooperation Agreement. There are no arrangements or understandings between Mr. Hatch and any other persons pursuant to which Mr. Hatch was selected as a director of the Company. There are no transactions between Mr. Hatch and the Company that would be reportable under Item 404(a) of Regulation S-K. Mr. Hatch will receive compensation for his service as a non-employee director of the Company’s Board in accordance with the terms of the Company’s director compensation program. Mr. Hatch will receive for 2022 a pro-rata amount (based on his service commencing May 1, 2022) of the $100,000 annual director base cash compensation, as well as a pro-rata amount of the cash fees payable to him as a member of the Audit Committee, Investment Oversight Committee, and Nominating and Governance Committee, and will receive an annual equity grant of $50,000 worth of restricted stock units at the next annual grant date. Mr. Hatch’s compensation as a non-employee director is otherwise as such compensation program is described in the Company’s Definitive Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission on May 2, 2022.
Additionally, pursuant to the terms of the Cooperation Agreement, Frederick A. Menowitz, a current Class I director, will retire from the Board at the earlier of the appointment of the Additional Independent Director and 180 days after the date of the Cooperation Agreement. There is no disagreement between the Company and Mr. Menowitz on any matter relating to the Company’s operations, policies or practices.
A copy of the press release issued by the Company on May 2, 2022 announcing the execution of the Cooperation Agreement and related matters is attached hereto as Exhibit 99.1 and incorporated herein by reference.
