UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
CURRENT REPORT
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Securities Exchange Act of 1934
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| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Awards of Stock Units under 2020 Incentive Plan
On March 10, 2021, Stewart Information Services Corporation (the “Company”) granted stock units (the “Stock Units”) to its named executed officers under the Stewart Information Services Corporation 2020 Incentive Plan (the “Plan”) pursuant to Stock Unit Award Agreements (the “Award Agreements”). Pursuant to each Award Agreement, the executives will receive Stock Units, each of which represent a contractual right to potentially receive a share of the Company’s common stock (a “Common Share”), provided all of the conditions for settlement of the Stock Units have been satisfied. The Stock Unit awards to the named executive officers were as follows:
| Name | Number of Units | |
| Frederick H. Eppinger | 14,871 | |
| David C. Hisey | 7,419 | |
| John L. Killea | 3,734 | |
| Steven M. Lessack | 8,939* | |
| Tara S. Smith | 2,291 |
| * | Includes 4,695 Stock Units that will vest and the forfeiture restrictions will lapse on March 20, 2022 |
Award recipients have all the rights of a shareholder in the Company, including the right to receive dividends, if declared, which will be delivered upon vesting. The Stock Units are subject to restrictions and forfeitures, as contained in the Award Agreements. The Stock Units will vest and the forfeiture restrictions will lapse in substantially equal one-third increments on each of March 20, 2022, March 10, 2023 and March 10, 2024 (except as noted with respect to 4,695 Stock Units granted to Mr. Lessack). Any Stock Units that are not vested as of the date of the executive’s termination of employment are automatically forfeited. In the event of a termination of the executive’s employment by the Company without Cause (as defined in the Award Agreement), by the executive for Good Reason (as defined in the Award Agreement), due to Retirement (as defined in the Award Agreement), or due to death or disability, any Stock Units held shall be subject to special pro rata vesting based on semi-annual increments, provided that the executive has been continuously employed by the Company for at least 25% of the period covered by the vesting schedule. In the event of a termination of the executive’s employment due to Voluntary Retirement (as defined in the Award Agreement), any Stock Units held shall immediately vest.
Awards of Restricted Stock Units under 2020 Incentive Plan
On March 10, 2021, the Company granted restricted stock units (the “RSUs”) to its named executed officers under the Plan pursuant to Restricted Stock Unit Agreements (the “RSU Agreements”). Pursuant to each RSU Agreement, the executives will receive RSUs, each of which represent a contractual right to potentially receive a Common Share provided the performance based restrictions and time-based restrictions of the RSUs have been satisfied. The RSUs awards to the named executive officers were as follows:
| Name | Number of Units | |
| Frederick H. Eppinger | 14,871 | |
| David C. Hisey | 7,419 | |
| John L. Killea | 3,734 | |
| Steven M. Lessack | 8,939 | |
| Tara S. Smith | 2,291 |
The performance restriction shall be satisfied based on three separate performance periods of January 1, 2021 to December, 31, 2021, January 1, 2022 to December 31, 2022, and January 1, 2023 to December 31, 2023 (each a “performance period”) and one-third of the RSUs will vest in each such performance period if the performance criteria and time-based restrictions are satisfied. If the Company does not satisfy the performance requirements for a performance period, the RSUs scheduled to become vested for such performance period will be forfeited effective as of the last day of the performance period. The time based restrictions will be satisfied if the executive remains continuously employed by the Company between March 10, 2021 and December 31, 2023. Any RSUs that are not vested as of the date of the executive’s termination of employment are automatically forfeited. In the event of a termination of the executive’s employment by the Company without Cause (as defined in the RSU Agreement), by the executive for Good Reason (as defined in the RSU Agreement), due to retirement (as specified in the RSU Agreement), or due to death or disability, the RSUs shall be subject to special pro-rata vesting based on semi-annual time increments with the time worked during the applicable incentive period rounded up to the nearest semi-annual time increment.
Awards of Stock Options under 2020 Incentive Plan
On March 10, 2021 (the “Grant Date”), the Company entered into Stock Option Agreements (the “Option Agreements”) with each of its named executive officers. Pursuant to each Option Agreement, the recipients were granted nonqualified options (the “Options”) subject to the terms and conditions of the Plan and the Option Agreements, each with an exercise price of $53.24, which is equal to the Fair Market Value (as defined in the Plan) of a Common Share as of the Grant Date. The Options granted to the named executive officers were as follows:
| Name | Number of Options | |
| Frederick H. Eppinger | 43,987 | |
| David C. Hisey | 21,944 | |
| John L. Killea | 11,044 | |
| Steven M. Lessack | 12,555 | |
| Tara S. Smith | 6,777 |
The executive’s rights with respect to 20% of the Common Shares underlying the Options vest on March 10, 2022, 30% of the Common Shares underlying the Options vest on March 10, 2023, and the remaining 50% of the Common Shares underlying the Options vest on March 10, 2024, subject to the terms of each recipient’s employment agreement, as may be amended from time to time. After such dates the Options may be exercised provided the executive remained in continuous service through the relevant vesting date. The Options expire on March 10, 2031.
If the executive’s employment is terminated as a result of death or disability, the unvested portion of the Option will expire and any vested portion may be exercised within such period of time ending on the earlier of (i) one year following such termination of employment, or (ii) the expiration of the Option. If the recipient’s employment is terminated for any reason other than death or disability, or Cause (as defined in the Option Agreement), the unvested portion of the Option will expire and any vested portion may be exercised within such period of time ending on the earlier of (i) 60 days following such termination of employment, or (ii) the expiration of the Option. If the recipient is terminated for Cause, the Option (whether vested or unvested) will immediately terminate and cease to be exercisable.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| STEWART INFORMATION SERVICES CORPORATION | |||
| By: | /s/ David C. Hisey | ||
David C. Hisey Chief Financial Officer, Secretary and Treasurer |
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Date: March 16, 2021