8-K Current Report
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 26, 2006
FRANKLIN
CREDIT MANAGEMENT CORPORATION
(Exact
name of registrant as specified in its charter)
|
Delaware
|
0-17771
|
75-2243266
|
|
(State
or other jurisdiction of
incorporation
or organization)
|
(Commission
file number)
|
(I.R.S.
employer
identification
no.)
|
|
Six
Harrison Street
New
York, New York
(Address
of principal executive offices)
|
|
10013
(Zip
code)
|
Registrant’s
telephone number, including area code: (201) 604-4402
______________________________________________________________________________
Check
the
appropriate box below in 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):
£
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))
FRANKLIN
CREDIT MANAGEMENT CORPORATION
FORM
8-K
CURRENT
REPORT
TABLE
OF
CONTENTS
Page
|
Item
1.01
|
Entry
into a Material Definitive Agreement 3
|
|
Item
5.02
|
Departure
of Directors or Principal Officers; Election of Directors; Appointment
of
Principal Officers
|
4
|
Signature
5
2
Item
1.01 Entry into a Material Definitive Agreement.
On
April
26, 2006, Franklin Credit Management Corporation (the “Company”) entered into an
employment agreement, effective as of March 1, 2006, between the Company and
Alexander Gordon Jardin.
Under
the
employment agreement, Mr. Jardin will be appointed by the Board of Directors
of
the Company as Chief Executive Officer effective on or after April 26,
2006.
Mr.
Jardin will be entitled to a base salary of $325,000, subject to adjustment
upward by the Board of Directors. Mr. Jardin’s target bonus in respect of 2006
will be 2.5% of net income. His actual bonus for the year will be subject to
the
reasonable discretion of the Board of Directors. Mr. Jardin’s bonus each year
will be determined and paid on or before May 1st
of the
following year. Mr. Jardin will also receive a signing bonus of $25,000 and
a
car allowance of $1,000 per month. In connection with his employment, the
Company will grant to Mr. Jardin fully-vested non-qualified options under the
Company’s 1996 Stock Incentive Plan to purchase 20,000 shares of the Company’s
common stock, exercisable until April 1, 2007, with an exercise price equal
to
the market price of the shares on the date of approval of the
grant.
Following
approval at the Company’s 2006 annual meeting of a new incentive compensation
plan, and registration under the Securities Act of 1933, as amended, of the
shares issuable under such plan, Mr. Jardin shall be entitled to a restricted
stock grant of 100,000 shares of Company common stock. Of such shares, 10,000
will be vested upon grant, 5,000 will vest on the first day after each fiscal
quarter from July 1, 2006 until April 1, 2008 and 6,250 shares will vest on
the
first day after each fiscal quarter from July 1, 2009 until April 1, 2010;
so
long as Mr. Jardin remains in the employ of the Company. Any unvested shares
will vest immediately upon a change in control of the Company (as defined in
the
employment agreement). Mr. Jardin will make an 83(b) election with respect
to
the restricted shares and the Company will reimburse him on a grossed up basis
for any taxes due from having made such election.
To
assist
with Mr. Jardin’s relocation to the New York City metropolitan area, the Company
agreed, among other things, to pay or reimburse certain costs associated with
such relocation and to gross up the amount of such payments or reimbursements
by
the amount of any taxes due thereafter.
Mr.
Jardin’s employment term runs for five years from the effective date of the
employment agreement, or until its earlier termination by the Company or Mr.
Jardin. Pursuant to the employment agreement, the Company may terminate Mr.
Jardin's employment with or without cause (as defined in the employment
agreement) and Mr. Jardin may terminate it with or without good reason (as
defined in the employment agreement).
In
the
event:
| · |
Mr.
Jardin is terminated by the Company without
cause,
|
| · |
Mr.
Jardin terminates his employment for good
reason,
|
| · |
following
a change of control Mr. Jardin terminates his employment or the Company
terminates his employment other than for cause, or
|
| · |
Mr.
Jardin’s employment terminates as a result of his death or disability (as
defined in the employment
agreement)
|
Mr.
Jardin will be entitled to severance, including a lump sum payment of $225,000
plus $13,542 for each month or partial month of employment thereafter prior
to
termination and a prorated bonus. In addition, if such termination is by Mr.
Jardin for good reason, or is because of Mr. Jardin’s death or disability, the
unvested portion of his restricted stock grant, if any, will immediately vest.
3
Under
the
employment agreement, Mr. Jardin is subject to covenants not engage in certain
competitive activities during his term of employment and for twelve months
thereafter, and not to solicit employees during the term of his employment
and
for nine months thereafter.
There
are
no family relationships between Mr. Jardin and any director or officer of the
Company.
Item
5.02. Departure
of Directors or Principal Officers; Election of Directors; Appointment of
Principal Officers
(c) At
a
board meeting on March 31, 2006, Alexander Gordon Jardin was appointed by the
Board of Directors of the Company to the position of Chief Executive Officer,
which appointment was subject to his entry into an employment agreement with
the
Company and was to be effective upon a date mutually agreed upon in such
employment agreement. Mr. Jardin’s appointment became effective on April 26,
2005. On April 26, 2006, the Company issued a press release, a copy of which
is
attached hereto as Exhibit 99.1, announcing Mr. Jardin’s
appointment.
Alexander
Gordon Jardin, age 53, was elected a Director of the Company in 2005. Since
April 2004 and until March 2006 Mr. Jardin acted as a consultant assisting
the
development of start-up life and health reinsurance companies.
From
October 2000 through April 2004, Mr. Jardin served in the capacity of President
and COO of Generali USA Life Reassurance Company, and Senior Vice President,
Reinsurance of Business Men’s Assurance Company, both of which were wholly-owned
subsidiaries of Assicurazioni Generali S.p.A., a leading global insurer
headquartered in Italy.
From
1993
to 2000 Mr. Jardin was President and CEO of Partner Re Life Insurance Company
of
the U.S. (previously known as Winterthur Life Re Insurance Company), the U.S.
life reinsurance subsidiary of Partner Re, a leading provider of multi-line
reinsurance on a global scale with principal offices in Bermuda, Greenwich,
Zurich and Paris. The asset portfolio of Partner Re Life was dominated by
Mortgage Backed Securities.
From
1986
to 1993, Mr. Jardin was Vice President and General Manager, Reinsurance for
Sun
Life Assurance Company of Canada. Mr. Jardin holds a Bachelor of Science degree
from McGill University in Montreal. He is an actuary by profession.
Item
9.01. Exhibits.
(d)
99.1 Press
release, dated April 26, 2006, entitled “Gordon
Jardin Joins Franklin Credit Management Team as Chief Executive
Officer”.
4
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, Franklin Credit
Management Corporation has duly caused this report to be signed on its behalf
by
the undersigned hereunto duly authorized.
Date: April
26,
2006
FRANKLIN
CREDIT MANAGEMENT
CORPORATION
By:
/s/
Paul D. Colasono______________________
Name: Paul D. Colasono
Title: Chief Financial Officer and Executive Vice President
5