Sirva 8-K 2006
Washington, D.C. 20549
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 30, 2006
(Exact name of registrant as specified in its charter)
700 Oakmont Lane
(Registrants telephone number, including area code): (630) 570-3000
(Former name or former address, if changed from last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry Into a Material Definitive Agreement.
On March 31, 2006, the Compensation Committee of the Board of Directors of SIRVA, Inc. (SIRVA) authorized an aggregate of approximately $3.8 million in discretionary bonus payments under the SIRVA, Inc. Management Incentive Plan (the MIP). Of this amount, $1,070,665 was paid to SIRVAs senior executive officers. These payments included $325,000 to Mr. Brian P. Kelly, SIRVAs President and Chief Executive Officer, which represented 50% of his target annual incentive opportunity under the MIP. Payments to other executive officers consisted of: $135,000 to Mr. Michael B. McMahon, SIRVAs President, Moving Services North America; $116,000 to Mr. Robert J. Rosing, SIRVAs President, Global Relocation Operations; $110,000 to Mr. Todd W. Schorr, SIRVAs Senior Vice President, Human Resources; $105,000 to Ms. Michelle M. Guswiler, SIRVAs Senior Vice President, Global Product and Supplier Management; $89,540 to Mr. Timothy P. Callahan, SIRVAs Senior Vice President, Global Sales; $88,125 to Mr. John M. Dupuy, SIRVAs Senior Vice President, Corporate Initiatives; $55,000 to Mr. James J. Bresingham, SIRVAs Executive Vice President-Chief Accounting Officer; and $47,000 to Mr. Douglas V. Gathany, SIRVAs Vice President, Treasurer.
Nondiscretionary funding of the MIP for 2005 did not occur because SIRVA failed to meet the MIPs threshold financial performance levels. This shortfall was due to a number of operational issues, as well as the disruption caused by the independent and internal reviews conducted by, respectively, SIRVAs Audit Committee and management, both of which involved the assistance of outside legal and financial advisors. These matters are more fully described in SIRVAs annual report on Form 10-K for the year ended December 31, 2004 (the Form 10-K). As described in the Form 10-K, SIRVAs management both conducted and participated in a comprehensive review and evaluation of SIRVAs financial and accounting practices. This review placed significant additional demands on SIRVAs management and key employees.
Despite the distractions created by the independent and internal reviews, SIRVAs staff was successful in establishing new customer relationships, as well as retaining SIRVA personnel. In recognition of these individual achievements, the Compensation Committee exercised its discretion under the MIP to authorize bonus payments to certain employees and members of SIRVAs management. Given the extraordinary efforts exerted by employees and the importance of the independent and internal reviews, the Compensation Committee believed that the discretionary bonus payments were consistent with the MIPs purpose, which among other things, includes attracting, retaining, motivating, and rewarding executive officers and key employees by providing such individuals with an opportunity to earn compensation based on their contributions to SIRVA.
Item 8.01 Other Events.
On March 30, 2006, SIRVA completed the sale (the Sale) of its Business Services Division in the United Kingdom and Ireland, including its UK Records Management business, GB Nationwide Crate Hire business and the Irish Security Archives unit, to Crown Worldwide Holdings Ltd., resulting in proceeds of approximately $87 million. SIRVA intends to use the proceeds of the Sale, net of taxes and related expenses, to repay certain of its outstanding indebtedness and for other corporate purposes. In recognition of the efforts of Mr. Kevin D. Pickford, SIRVAs President and Managing Director, Europe, in assisting with the successful completion of the Sale, SIRVA will pay Mr. Pickford a success bonus of £50,000. A copy of SIRVAs press release, dated March 30, 2006, which announced the completion of the Sale, is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired.
(b) Pro Forma Financial Information.
(c) Shell Company Transactions.
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 hereunto duly authorized.