Item 2.01. Completion of Acquisition or Disposition of Assets
On September 8, 2022, FedNat Holding Company (the "Company") and a group of
investors managed by Hale Partnership Capital Management LLC (the "Hale
Investors") entered into a Stock Purchase Agreement (the "Stock Purchase
Agreement") and closed the sale of 30,000 shares of the common stock of Monarch
National Insurance Company ("Monarch") held by the Company to the Hale Investors
for $2.5 million. As a result of this transaction, the Hale Investors increased
their ownership of Monarch's outstanding common stock to 70% and the Company
reduced its ownership of Monarch's common stock to 30%. The Company retains two
seats on Monarch's board of directors and continues to provide managing general
agent services, including policy servicing and claims administration, to Monarch
through the Company's wholly owned subsidiary, FedNat Underwriters, Inc. This
transaction was entered into pursuant to the put right agreed to by the parties
in conjunction with the previously disclosed closing on June 30, 2022 of the
Hale Investors' and the Company's investments in Monarch. A copy of the Stock
Purchase Agreement is filed as Exhibit 10.1 to this Form 8-K.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers
(a) On September 6, 2022, the Company received the resignation of Erick A.
Fernandez, the Company's Interim Chief Financial Officer. Mr. Fernandez's
resignation is effective September 20, 2022.
(b) On September 8, 2022, the Company's Board of Directors appointed J. Gordon
Jennings III to serve as interim Chief Financial Officer effective September 20,
2022. Mr. Jennings, age 64, currently serves as Vice President of Risk
Management, a position he has held since 2008. He has served in various roles
with the Company since 2000, including serving as the Company's Controller from
May 2000 through August 2002, as the Company's Chief Financial Officer from
August 2002 through June 2007, and as Chief Accounting Officer from June 2007
through March 2008. Mr. Jennings, formerly a certified public accountant, also
holds a Certificate in General Insurance, an Associate in Insurance Services and
an Associate in Risk Management as designated by the Insurance Institute of
America.
Item 9.01. Financial Statements and Exhibits.
Exhibits. The following exhibit index lists the exhibits that are either filed or
(d) furnished with this Current Report on Form 8-K.
Stock Purchase Agreement dated as of September 8, 2022 among FedNat Holding
10.1 Company and the Hale Investors
Cover Page Interactive File (the cover page tags are embedded within the Inline
104 XBRL document).
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