Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On February 17, 2022 (the “Grant Date”), following consultation with its independent compensation consultant, the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of Regional Management Corp. (the “Company”) approved certain compensation arrangements with respect to the Company’s named executive officers (the “NEOs”), as described below. The Committee also adopted a new form of award agreement under the Regional Management Corp. 2015 Long-Term Incentive Plan (As Amended and Restated Effective May 20, 2021) (the “2015 Plan”). Specifically, the Committee approved the form of Performance Restricted Stock Unit Award Agreement (the “PRSU Award Agreement”), which is attached as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference. The foregoing description of the PRSU Award Agreement is not complete and is qualified in its entirety by reference to the full text of such agreement.
The Committee granted the following awards to the NEOs under the 2015 Plan: (i) performance restricted stock units (“PRSUs”) and (ii) restricted stock, in each case subject to the terms of the 2015 Plan and the applicable award agreement.
The NEOs were each granted PRSUs with the target number of PRSUs (rounded down to the nearest whole unit) determined by dividing the value of the grant by the fair value of each PRSU (calculated on or as close in time as practicable to the Grant Date in accordance with GAAP using a Monte Carlo valuation model). The PRSU grant values are: Mr. Beck: $1,500,000; Ms. Rana: $400,000; Mr. Schachtel: $412,500; Mr. Fisher: $337,500; and Mr. Parmar: $272,500. The actual number of PRSUs, if any, that may be earned ranges from 0% to 150% of the target number of units and will be based on achievement of the Company’s cumulative total shareholder return over the performance period, February 17, 2022 through December 31, 2024, and the continued employment of each such executive through December 31, 2024, or as otherwise provided in the 2015 Plan or the PRSU Award Agreement, the form of which is filed herewith. Any shares of the Company’s common stock payable upon vesting and earning of the PRSUs will be subject to an additional one-year holding period following the end of the performance period and will be distributed to the employee no earlier than December 31, 2025, unless otherwise provided in the 2015 Plan or the PRSU Award Agreement.
The NEOs were each granted restricted stock, subject to a Restricted Stock Award Agreement (“RSA Agreement”), with the number of shares calculated by dividing the value of the grant by the fair market value of the Company’s common stock on the Grant Date, based upon grants of the following values: Mr. Beck: $1,500,000; Ms. Rana: $400,000; Mr. Schachtel: $412,500; Mr. Fisher: $337,500; and Mr. Parmar: $272,500. One-third of the shares subject to each award shall vest on each of December 31, 2022, December 31, 2023, and December 31, 2024, subject to the executive’s continued employment from the Grant Date through the respective vesting date or as otherwise provided in the 2015 Plan or the RSA Agreement, the form of which was previously filed with the Securities and Exchange Commission.
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