INFORMATION
TO BE INCLUDED IN THE REPORT
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Item
5.02
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Departure
of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain
Officers.
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(b) Retirement
of Officer; Retirement of Director
On May 20, 2009, First Mariner Bancorp
(the “Company”) issued a press release announcing that Joseph A. Cicero would
retire on May 22, 2009 as the President of the Company and as Chief Operating
Officer of its bank subsidiary, First Mariner Bank (the “Bank”). Mr.
Cicero also served as a director of the Company and of the Bank, and he retired
from these positions as well.
(c)
and (d) Appointment of
Officers; Election of Director
Also effective May 22, 2009, Mark A.
Keidel, age 47, was appointed as President and Chief Operating Officer of the
Company and as Executive Vice President and Chief Operating Officer of the
Bank. Mr. Keidel has served as the Senior Vice President and Chief
Financial Officer of the Company and as Executive Vice President and Chief
Financial Officer of the Bank since June 2000, and will continue to serve as
Treasurer of Mariner Finance, LLC and Mariner Finance Mortgage, LLC, both of
which are wholly-owned subsidiaries of the Company, positions he has held since
April 2002 and August 2008, respectively. Mr. Keidel’s annual base
salary, which is currently $193,500, will be reviewed by the Compensation
Committee at its next meeting. He will continue to participate in the
various compensatory and benefit plans that the Company and the Bank maintain
for executive officers and employees to the extent he is eligible, which are
described in detail in the Company’s most recent definitive proxy statement
filed with the Securities and Exchange Commission (the “Benefit
Plans”). Mr. Keidel will be elected to serve on the Boards of
Directors of the Company and the Bank until the next annual meeting of
stockholders and until his successors are duly elected and
qualify. The Company’s Board anticipates that Mr. Keidel will be
appointed to serve on its Executive and Community Action
Committees.
In connection with this transition,
Robert P. Warr, age 57, was appointed as Chief Risk Officer and Executive Vice
President of the Company and of the Bank, and Paul B. Susie, age 42, was
appointed as the Chief Financial Officer of the Company and of the
Bank. Mr. Warr’s appointment was effective on May 22, 2009, and Mr.
Susie’s employment will begin on June 8, 2009. Mr. Warr has served as
the Bank’s Senior Vice President of Commercial Lending since April
1997. His annual salary, which is currently $100,000, will be
reviewed by the Compensation Committee at its next meeting. He
currently receives incentive compensation relating to his duties as a commercial
loan officer, which are in addition to his current salary. Mr. Warr’s
participation in incentive plans relating to commercial lending will terminate
effective June 30, 2009. He will participate in the Benefit Plans to
the extent he is eligible. Mr. Susie, who is new to the organization,
began his career as an accountant with Coopers and Lybrand (now
PriceWaterHouseCoopers), a public accounting firm, and thereafter served in
several senior financial positions, including as the Controller of Baltimore
Marine Industries, which owned and operated a full-service shipyard, Vice
President of Administration and Controller of Earthshell Corporation, a
disposable packaging manufacturer, and Corporate Controller and later Chief
Accounting Officer at Celsion Corporation, an oncology drug development
company. A graduate of the University of Baltimore, Mr. Susie has
over 18 years of experience in both public and corporate accounting and is a
Certified Public Accountant. Mr. Susie’s initial annual salary will
be $150,000, subject to review and approval by the Compensation Committee at its
next meeting, and he will also participate in the Benefit Plans to the extent he
is eligible.
The Bank periodically engages in loan
and other banking transactions with its directors and executive officers and
their related interests. All such transactions with Messrs. Keidel,
Warr and Susie since January 1, 2008 have been made on substantially the same
terms, including interest rates, collateral, and repayment terms on loans, as
those prevailing at the same time for comparable transactions with
others. The extensions of credit by the Bank to these persons have
not and do not currently involve more than the normal risk of collectability or
present other unfavorable features.
(e) Compensatory
Plan
In connection with Mr. Cicero’s
retirement, the Company, the Bank and Mr. Cicero entered into a Transition
Agreement with General Release and Independent Contractor Consultant Engagement
dated as of May 20, 2009 (the “Transition Agreement”), a copy of which is filed
herewith as Exhibit 10.1. The following discussion summarizes the
material terms of the Transition Agreement and is qualified in its entirety by
the complete Transition Agreement.
Under the Transition Agreement, Mr.
Cicero’s employment with the Company and the Bank terminated effective May 22,
2009, and he resigned from the Boards of Directors of the Company and the
Bank. The disability and long-term care insurance benefits that Mr.
Cicero enjoyed as an employee also terminated on May 22, 2009, and any life
insurance benefits that he enjoyed will terminate, continue and/or convert in
accordance with the terms of the related benefit plans. Mr. Cicero’s
health insurance coverage will terminate on May 31, 2009. Other than
receiving any unpaid salary that had accrued through May 22, 2009 and the
foregoing insurance benefits, no other employment-related compensation will be
paid to Mr. Cicero after May 22, 2009.
The Transition Agreement provides that
Mr. Cicero will serve as a consultant to the First Mariner organization through
December 31, 2009, focusing primarily on assisting it with various regulatory
matters. Mr. Cicero will provide up to 40 hours of services per month
and will receive a consulting fee, for the period beginning on May 23, 2009 and
ending on December 31, 2009, in an amount equal to a proportionate share of the
regular annual salary he received as an employee (which was
$256,500). This fee will be paid in bi-weekly
installments. In addition, assuming Mr. Cicero complies with the
terms of the Transition Agreement, he will receive transition payments in the
aggregate amount of $96,187.50, to be paid as follows: (i) a payment
of $21,375 will be made in each of January and February 2010; and (ii) a payment
of $53,437.50 will be made on or before March 15, 2010. Until
December 31, 2009, the Company will continue to pay its portion of the premiums
for coverage under the Company’s health insurance plan for Mr. Cicero, his
spouse and his dependents, but only if they elect continuation of health
benefits under COBRA, remain eligible therefor and make their co-payments, the
plan remains in effect, and Mr. Cicero remains eligible to receive consulting
fees under the Transition Agreement.
In consideration of the various
benefits to be received as a consultant, Mr. Cicero agreed (i) not to provide
assistance to or otherwise become associated with any person who has purchased
or obtained, or who intends to purchase or obtain, a Controlling Interest (as
defined in the Transition Agreement) in the Company or any of its subsidiaries,
(ii) not to beneficially own more than 5.00% of the outstanding capital stock of
the Company or any of its subsidiaries, (iii) not to take any actions having the
purpose or effect of changing or influencing the control of the Company or any
of its subsidiaries, (iv) until May 22, 2010, not to complete, directly or
indirectly, with the Company or any of its subsidiaries within 50 miles of the
Company’s main office or within 10 miles of any branch or other office of the
Company or the Bank, and (v) until May 22, 2011, not to solicit, entice or
encourage, directly or indirectly, any customer, client, contractor or vendor of
the Company or the Bank or any employee of the Company or the Bank to terminate
its, his or her relationship or employment, respectively, with the Company or
the Bank.
The Transition Agreement contains
customary provisions, including releases of certain claims against the First
Mariner organization and provisions relating to confidentiality of information,
use of proprietary information and non-disparagement of the First Mariner
organization.
The Transition Agreement may be
rescinded by Mr. Cicero until May 27, 2009.
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Item
7.01
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Regulation
FD Disclosure
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A copy of the press release described
in Item 5.02 of this report is furnished herewith as Exhibit
99.1. The information contained in Exhibit 99.1 shall not be deemed
“filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), or incorporated by reference in any filing under
the Securities Act of 1933, as amended, or the Exchange Act, except as shall be
expressly set forth by specific reference in such a filing.
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Item
9.01
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Financial
Statements and Exhibits
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(d) Exhibits
The exhibits filed or furnished with
this report are listed in the Exhibit Index that immediately follows the
signatures to this report, which Exhibit Index is incorporated herein by
reference.