Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers.
Approval of an Amendment to the Companys Long Term Incentive Plan
As discussed in Item 5.07 below, at the annual meeting (the
Annual Meeting
) of stockholders of Health
Insurance Innovations, Inc. (the
Company
) held on May 25, 2016, the Companys stockholders approved an amendment to the Companys Long-Term Incentive Plan (the
LTIP
) to (i) increase the total
number of shares of the Companys common stock reserved for issuance under the LTIP from 2,250,000 to 3,250,000; (ii) increase the annual per-person limitations in the LTIP to 725,000 shares and to apply a single per-person limitation to
all performance-based awards under the LTIP; and (iii) increase the aggregate maximum number of shares of common stock that may be issued under the LTIP to 1,800,000 shares (collectively, the
Amendment
). The Amendment is also
described in the Companys Definitive Proxy Statement filed with the SEC on April 28, 2016 in the section entitled Proposal 2 Approval of an Amendment to the Long Term Incentive Plan, as supplemented by the Supplement to
Proxy Statement filed on Form 8-K on May 13, 2016 (as supplemented, the
Proxy Statement
).
Granting of Bonuses
and Equity Awards to Management
On May 25, 2016, the Compensation Committee of the Board of Directors of the Company (the
Compensation Committee
) approved an executive annual bonus plan (the
Bonus Plan
) for the fiscal year ending December 31, 2016, with awards under the Bonus Plan being based on Company performance (or the
performance of an executives respective business unit) for the 2016 fiscal year. Company (or business unit) performance will be based on the achievement of specified financial goals related to revenue and adjusted EBITDA.
Under the Bonus Plan, the maximum payouts for the named executive officers (including the principal executive officer and principal financial
offer) are as follows, and such payouts will be based on performance of the entire Company:
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NAMED EXECUTIVE OFFICER
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MAXIMUM BONUS PAYOUT
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Patrick McNamee
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$
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495,000
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Michael Kosloske
|
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$
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477,000
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Michael Hershberger
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$
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186,000
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Also on May 25, 2016, the Compensation Committee approved certain equity grants to the forgoing persons
under the LTIP as follows:
The respective employment agreements for Mr. McNamee and Mr. Kosloske provide that, at the sole
discretion of the Companys Board of Directors, each of them will receive on each anniversary of his employment agreement an additional grant of stock-settled stock appreciation rights (
SAR
s) under the LTIP having an
aggregate value (based on the Black-Sholes option pricing model) equal to 100% of his base salary. As specified in the employment agreements, such SARS will have an exercise price equal to the closing price of the Companys Class A Common
Stock on the date of grant, will expire on the seventh anniversary of the date of grant, and will vest in increments of 25% on the first anniversary of the grant date, 25% on the second anniversary, and 50% on the third anniversary.
Mr. Hershbergers employment agreement provides for a grant of equity under the LTIP having an aggregate value (based on the Black-Sholes option pricing model) equal to 50% of his base salary under the same terms, provided that 1/3 of such
grant will be in the form of restricted shares and 2/3 will be in the form of SARs. On May 25, 2016, the Compensation Committee, acting under delegation of the Board of Directors, approved the foregoing discretionary grants to Messrs. McNamee,
Kosloske, and Hershberger to be made on June 8, 2016, November 19, 2016, and September 16, 2016, respectively.
In
addition, the Compensation Committee approved the grant to Mr. McNamee of 125,000 stock-settled SARs on May 25, 2016. These SARs expire on May 25, 2021, have an exercise price of $6.77, and vest on the first day on which the
Companys Class A common stock is at or above $16.00 per share for the preceding 30 consecutive trading days. Otherwise, the SARs have the same terms as the SARs granted to Mr. McNamee on November 9, 2015.
Item 5.07.
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Submission of Matters to a Vote of Security Holders.
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On May 25, 2016, the Company
held its Annual Meeting. The Company previously filed with the SEC the Proxy Statement and related materials pertaining to the Annual Meeting. On the record date of April 4, 2016 there were 7,910,086 shares of the Companys Class A
common stock and 6,841,667 shares of the Companys Class B common stock outstanding and eligible to vote. At the Annual Meeting, the stockholders (i) elected the seven persons identified below to serve as directors of the Company to hold
office until the Companys 2017 Annual Meeting of Stockholders or until their successors are duly elected and qualified, and (ii) approved the Amendment, which (i) increased the total number of shares of the Companys common
stock reserved for issuance under the LTIP from 2,250,000 to 3,250,000; (ii) increased the annual per-person limitations in the LTIP to 725,000 shares and to apply a single per-person limitation to all performance-based awards under the LTIP;
and (iii) increased the aggregate maximum number of shares of common stock that may be issued under the LTIP to 1,800,000 shares.
Proposal 1: Election of Directors
The final results of stockholder voting on the election of directors were as follows:
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Votes For
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Votes Withheld
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Name
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Class A
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Class B
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Class A
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Class B
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Paul E. Avery
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2,649,026
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6,841,667
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1,134,071
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Anthony J. Barkett
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2,404,257
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6,841,667
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1,378,840
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Paul G. Gabos
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2,377,158
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6,841,667
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1,405,939
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Michael W. Kosloske
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3,730,714
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6,841,667
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52,383
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Patrick R. McNamee
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3,739,324
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6,841,667
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43,773
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Robert S. Murley
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3,466,539
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6,841,667
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316,558
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Bruce A. Telkamp
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3,733,414
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6,841,667
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49,683
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There were no broker non-votes with respect to the Class A common stock or the Class B common stock.
Proposal 2: Approval of an Amendment to the Companys Long-Term Incentive Plan
The final results of stockholder voting on the approval of an amendment to the LTIP were as follows:
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Votes For
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Votes Against
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Votes Abstain
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Broker Non-Votes
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8,636,747
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1,982,767
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5,250
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0
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There were no broker non-votes with respect to the Class A common stock or the Class B common stock.
The stockholders did not vote on any other matters at the Annual Meeting.