Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Colligan Separation
On June 22, 2021, Chimera Investment Corporation (the "Company") and Robert
Colligan mutually agreed that Mr. Colligan will separate from employment with
the Company, effective September 20, 2021. Mr. Colligan will step down from his
position as Chief Financial Officer, effective June 22, 2021, and will assist
with the transition through September 20, 2021.
In connection with Mr. Colligan's departure, Mr. Colligan will receive the
severance payments and benefits provided under his employment agreement with the
Company, effective January 1, 2019, as previously filed with the Securities and
Exchange Commission, for a termination without cause, subject to his execution
and non-revocation of a release of claims and compliance with post-termination
restrictive covenants.
Kortman Appointment
On June 22, 2021, the Company appointed the Company's current Chief Accounting
Officer, Kelley Kortman, as the Principal Accounting Officer. Mr. Kortman, age
50, has been with the Company since 2013 and has been the Company's Chief
Accounting Officer since 2015. Mr. Kortman will not receive any additional
compensation in connection with his service as Principal Accounting Officer. He
receives a base salary and is eligible for cash bonuses, equity awards and other
benefits offered to the Company's employees.
Viswanathan Appointment
On June 22, 2021, the Company appointed Subramaniam ("Subra") Viswanathan, age
49, as the Company's Chief Financial Officer, and Principal Financial Officer,
to be effective as soon as practicable, but not later than September 15, 2021
("Start Date"). The Company has entered into an employment agreement
("Employment Agreement") with Mr. Viswanathan described below. Prior to joining
the Company, Mr. Viswanathan served as the Managing Director, Chief Operating
Officer - Global Mortgages and Securitized Products since 2012 and served other
roles at Bank of America Merrill Lynch since 2007. Mr. Viswanathan previously
served as the Senior Vice President, Business Area Controller - Cash and
Synthetic CDOs, Securitization and Correlation Desks at Citigroup, Corporate and
Investment Banking. Mr. Viswanathan earned his degree in economics from the
University of Madras in Chennai, India and his MBA from University of Hartford.
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In this position, Mr. Viswanathan will report to the Company's Chief Executive
Officer. The term of employment under the Employment Agreement commences on his
Start Date and (i) will continue until December 31, 2022 and (ii) will be
extended until the first December 31st that coincides with, or follows, the
second anniversary of any change in control of the Company that occurs during
the term of employment. The term of employment under the Employment Agreement
will be extended for an additional one year period on the last day of (i) or
(ii) unless either party provides 90 days prior written notice of nonrenewal to
the other party, and will be extended in any event through the last day of a
garden leave period if applicable. Mr. Viswanathan will receive a base salary of
not less than $500,000 per year. For each calendar year, Mr. Viswanathan will be
eligible to receive an annual cash bonus, which amount is $1,000,000 for
calendar year 2021 and for calendar years on and after 2022 shall be based on
performance metrics determined by the Compensation Committee in good faith
consultation with, and subject to agreement of, the Company's Chief Executive
Officer. Mr. Viswanathan generally must remain employed by the Company through
the last day of each calendar year to receive payment of the annual bonus.
In 2021, Mr. Viswanathan will receive a restricted stock unit ("RSU") that vests
in three equal annual installments on January 2, 2022, January 2, 2023 and
January 2024, subject to continued employment through the vesting dates. For
each calendar year starting in 2022, Mr. Viswanathan will be eligible to receive
long-term incentive compensation in the form of RSUs and/or performance stock
units ("PSUs") granted under the Company's current equity compensation plan with
a target value of $750,000. In and after calendar year 2022, Mr. Viswanathan
will be granted long-term incentive compensation in the form of 50% RSUs and 50%
PSUs. The RSU component will vest in three equal installments on the first three
anniversaries of the date of grant based on continuing employment, and 0% to
200% of the target PSU amount will vest based on the satisfaction of performance
goals, subject to continuing employment. Dividend equivalents will accrue on
the RSUs and PSUs granted when dividends are paid to the Company's shareholders
and will be paid to the extent the underlying RSUs and PSUs vest.
If Mr. Viswanathan's employment is terminated in the event of disability, the
Company will reimburse him for 100% of his COBRA premiums for 18 months. Upon
his termination of employment by reason of death or disability, Mr. Viswanathan
is entitled to (i) accelerated vesting of time-based equity awards, (ii)
continued vesting potential of the PSUs and any other performance-based awards,
and (iii) a pro-rata annual cash bonus for the year of termination.
In the event Mr. Viswanathan's employment with the Company is terminated by the
Company without cause (other than for death or disability) or by Mr. Viswanathan
with good reason (other than in connection with a change in control), Mr.
Viswanathan will be entitled to 1.5 times his base salary as of the termination
date and 1.5 times the greater of his target cash bonus or the average of the
annual cash bonus awarded to him for the three most recent calendar years ending
on or before the termination date, which will be paid in 18 equal monthly
installments. Mr. Viswanathan will also be entitled to: (i) accelerated vesting
of time-based equity awards, (ii) continued vesting potential of the PSUs and
any other performance-based awards, (iii) a pro-rata annual cash bonus for the
year of termination, and (iv) 12 months of Company-paid COBRA premiums.
In the event Mr. Viswanathan's employment with the Company is terminated by the
Company other than for cause or disability, and within six months before, or 24
months after, a change in control, or by Executive with good reason and within
24 months after a change in control, Mr. Viswanathan will be entitled to 2.0
times his base salary as of the termination date and 2.0 times the greater of
his target cash bonus or the average cash bonus awarded to him for the three
most recent calendar years ending on or before the termination date, which shall
be paid in a cash lump sum. Mr. Viswanathan will also be entitled to: (i)
accelerated vesting of time-based equity awards, (ii) the outstanding PSUs or
other performance-vesting equity-based grants whose continued vesting after such
change in control is based solely on continued employment will vest in full as
of the termination date (or as of the change in control, if later) or
outstanding PSUs and any other performance-based awards that continue to vest
based on performance will continue to have vesting potential, (iii) a pro-rata
annual cash bonus for the year of termination, and (iv) 18 months of
Company-paid COBRA premiums.
If the Company provides Mr. Viswanathan written notice of nonrenewal of the
Employment Agreement and the Company terminates Mr. Viswanathan's employment
without cause after the last day of the term of employment outlined in the
Employment Agreement, the Company will continue to pay Mr. Viswanathan his base
salary for a period of one year following the termination date in accordance
with the Company's regular payroll practices (unless the termination is within
24 months following a change in control, in which case this amount will be paid
in a cash lump sum), and Mr. Viswanathan will also be entitled to: (i)
accelerated vesting of time-based equity awards, (ii) continued vesting
potential of the PSUs and any other performance-based awards, (iii) a pro-rata
annual cash bonus for the year of termination, and (iv) 12 months of
Company-paid COBRA premiums.
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If the Company provides Mr. Viswanathan written notice of nonrenewal of
Employment Agreement, the Company does not offer Mr. Viswanathan a successor
employment agreement that is substantially equivalent to the Employment
Agreement (viewed in the aggregate) at least 10 days before the last day of the
term of employment, and Mr. Viswanathan provides written notice of termination
no later than the seventh day after the last day of the term of employment, Mr.
Viswanathan will be entitled to: (i) accelerated vesting of time-based equity
awards, (ii) continued vesting potential of the PSUs and any other
performance-based awards, (iii) a pro-rata annual cash bonus for the year of
termination, and (iv) 12 months of Company-paid COBRA premiums.
If Mr. Viswanathan terminates his employment with the Company (with or without
good reason) at any time and the sum of his age plus his years of service with
the Company and its predecessors equals or exceeds 65 as of the termination
date, and he has at least five years of service with the Company and its
predecessors as of the termination date, Mr. Viswanathan will be entitled to:
(i) accelerated vesting of time-based equity awards, (ii) continued vesting
potential of the PSUs and any other performance-based awards, (iii) a pro-rata
annual cash bonus for the year of termination, and (iv) 12 months of
Company-paid COBRA premiums.
Any severance payments or benefits payable by the Company as described above are
subject to Mr. Viswanathan signing and not revoking a release in favor of the
Company.
Mr. Viswanathan is subject to customary non-solicitation and non-competition
covenants during his employment and for 12 months post-employment, and is also
bound by customary non-disparagement and confidentiality restrictions.
Mr. Viswanathan will enter into the Company's standard indemnification
agreement, a copy of which is filed as Exhibit 10.6 to the Company's Quarterly
Report on Form 10-Q filed with the SEC on November 5, 2015.
Mr. Marria, the Company's Chief Executive Officer, will serve as the Principal
Financial Officer pending Mr. Viswanathan's commencement of employment as Chief
Financial Officer.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
Exhibit No. Description
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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