TIPTREE INC.
10-Ks and 10-Qs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the
Registrant x
Filed by a Party other than the
Registrant o
Check the appropriate box:
o Preliminary
Proxy Statement
o Confidential,
for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
x Definitive
Proxy Statement
o Definitive
Additional Materials
o Soliciting
Material Pursuant to
§ 240.14a-12
Care Investment
Trust Inc.
(Name of Registrant as Specified In
Its Charter)
(Name of Person(s) Filing Proxy
Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
x No
fee required.
| o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
| (1) | Title of each class of securities to which transaction applies: |
| (2) | Aggregate number of securities to which transaction applies: |
| (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): |
| (4) | Proposed maximum aggregate value of transaction: |
| (5) | Total fee paid: |
| o | Fee paid previously with preliminary materials. |
| o | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| (1) | Amount Previously Paid: |
| (2) | Form, Schedule or Registration Statement No.: |
| (3) | Filing Party: |
| (4) | Date Filed: |
Table of Contents
November 22,
2010
Dear Stockholder:
You are invited to attend the annual meeting of stockholders of
Care Investment Trust Inc. This year’s meeting will be
held on Monday, December 20, 2010, at 10:00 a.m.,
local time, at the Care Investment Trust headquarters, 780 Third
Avenue, 29th Floor, New York, NY 10017.
The attached proxy statement, with the accompanying formal
notice of the meeting, describes the matters expected to be
acted upon at the meeting. We urge you to review these materials
carefully and to take part in the affairs of our Company by
voting on the matters described in the accompanying proxy
statement. We hope that you will be able to attend the meeting.
Our directors and management team will be available to answer
questions. Afterwards, there will be a vote on the matters set
forth in the accompanying proxy statement.
Your vote is important. Whether you plan to attend the meeting
or not, please vote either over the Internet, by toll-free
telephone or by completing the enclosed proxy card and returning
it as promptly as possible. If you attend the meeting, you may
continue to have your shares of common stock voted as instructed
over the Internet, by toll-free telephone or in the proxy card
or you may change your vote either by voting again before
11:59 p.m., Eastern Standard Time, on December 19,
2010, the time at which the Internet and telephone voting
facilities close or by submitting a proxy card prior to or at
the meeting.
Sincerely,
Salvatore (Torey) V. Riso, Jr.
President and Chief Executive Officer
Table of Contents
CARE
INVESTMENT TRUST INC.
780 Third Avenue,
21st Floor
New York, NY 10017
780 Third Avenue,
21st Floor
New York, NY 10017
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
to be held on December 20, 2010
to be held on December 20, 2010
The 2010 annual meeting of stockholders of Care Investment
Trust Inc. will be held on Monday, December 20, 2010,
at 10:00 a.m., local time, at the Care Investment
Trust Inc. headquarters, 780 Third Avenue, 29th Floor,
New York, NY 10017. At the annual meeting, stockholders will
vote upon the following proposals:
| 1. | To elect seven (7) directors to serve until the 2011 annual meeting of stockholders or until their successors are duly elected and qualified; |
| 2. | To ratify the selection of Deloitte & Touche LLP as our independent auditors for the fiscal year ending December 31, 2010; and | |
| 3. | To consider and act upon such other matters that may properly be brought before the annual meeting or at any adjournments or postponements thereof. |
Any action may be taken on the foregoing matters at the annual
meeting on the date specified above, or on any date or dates to
which, by original or later adjournment, the annual meeting may
be adjourned, or to which the annual meeting may be postponed.
Our Board of Directors has fixed the close of business on
November 15, 2010, as the record date for determining the
stockholders entitled to notice of, and to vote at, the annual
meeting, and at any adjournments or postponements thereof. Only
stockholders of record of our common stock at the close of
business on that date will be entitled to notice of, and to vote
at, the annual meeting and at any adjournments or postponements
thereof. A list of stockholders entitled to vote at the annual
meeting will be available at the annual meeting and for ten
(10) calendar days prior to the annual meeting, between the
hours of 9:00 a.m. and 4:00 p.m., local time, at our
corporate offices located at 780 Third Avenue, 21st Floor,
New York, NY 10017. You may arrange to review this list by
contacting our Secretary and Chief Compliance Officer, Steven M.
Sherwyn at
(212) 446-1407.
All stockholders of record can vote (1) over the Internet,
(2) by toll-free telephone (please see the proxy card for
instructions), (3) by written proxy by signing and dating
the proxy card and returning it or (4) by attending the
annual meeting in person.
Whether or not you plan to attend the annual meeting, please
vote either over the Internet, by toll-free telephone or by
completing, signing, dating and promptly returning the enclosed
proxy card in the postage-prepaid envelope provided. For
specific instructions on voting, please refer to the
instructions on the proxy card or the information forwarded by
your broker, bank or other holder of record. If you attend the
annual meeting, you may vote in person if you wish, even if you
have previously voted. Please note, however, that if your shares
are held of record by a broker, bank or other nominee and you
wish to vote in person at the meeting, you must obtain a proxy
issued in your name from such broker, bank or other nominee.
We encourage you to receive all proxy materials in the future
electronically to help us save printing costs and postage fees,
as well as natural resources in producing and distributing these
materials. If you wish to receive these materials electronically
next year, please follow the instructions on the proxy card.
By Order of our Board of Directors,
Steven M. Sherwyn
Secretary and Chief Compliance Officer
New York, New York
November 22, 2010
Table of Contents
Table of
Contents
| iii | ||||
| iii | ||||
| iii | ||||
| iii | ||||
| iv | ||||
| iv | ||||
| iv | ||||
| iv | ||||
| iv | ||||
| v | ||||
| v | ||||
| v | ||||
| v | ||||
| vi | ||||
| 1 | ||||
| 1 | ||||
| 1 | ||||
| 4 | ||||
| 4 | ||||
| 5 | ||||
| 5 | ||||
| 6 | ||||
| 8 | ||||
| 8 | ||||
| 8 | ||||
| 8 | ||||
| 8 | ||||
| 9 | ||||
| 9 | ||||
| 9 | ||||
| 9 | ||||
| 10 | ||||
| 10 | ||||
| 11 | ||||
| 11 | ||||
| 12 | ||||
| 12 | ||||
| 12 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 14 | ||||
| 14 |
i
Table of Contents
| 16 | ||||
| 16 | ||||
| 17 | ||||
| 17 | ||||
| 18 | ||||
| 18 | ||||
| 18 | ||||
| 18 | ||||
| 20 | ||||
| 20 | ||||
| 20 | ||||
| 21 | ||||
| 21 | ||||
| 22 | ||||
| 23 | ||||
| 23 | ||||
| 23 | ||||
| 23 | ||||
| 24 | ||||
| 24 | ||||
| 25 | ||||
| 25 | ||||
| 25 | ||||
| 26 | ||||
| 26 | ||||
| 26 | ||||
| 26 | ||||
| 27 |
ii
Table of Contents
CARE
INVESTMENT TRUST INC.
780 Third Avenue,
21st Floor
New York, NY 10017
780 Third Avenue,
21st Floor
New York, NY 10017
PROXY
STATEMENT
FOR 2010 ANNUAL MEETING OF STOCKHOLDERS
to be held on December 20, 2010
FOR 2010 ANNUAL MEETING OF STOCKHOLDERS
to be held on December 20, 2010
This proxy statement is furnished by Care Investment
Trust Inc. to our stockholders in connection with the
solicitation of proxies by our Board of Directors for use at the
2010 annual meeting (the “Annual Meeting”) of
stockholders to be held on Monday, December 20, 2010, at
10:00 a.m., local time, at the Care Investment
Trust Inc. headquarters, 780 Third Avenue, 29th Floor,
New York, NY 10017, and at any and all postponements or
adjournments of our Annual Meeting. References in this proxy
statement, unless the context requires otherwise, to
“Care,” the “Company,” “we,”
“our,” “ours,” and “us” refer to
Care Investment Trust Inc. and our consolidated
subsidiaries. The approximate date on which this proxy statement
and form of proxy solicited on behalf of the Board of Directors
is first being sent to our stockholders is November 22,
2010.
On August 13, 2010, we completed the sale of control of the
Company through a combination of an equity investment by Tiptree
Financial Partners, L.P. (“Tiptree”) in newly issued
common stock and a cash tender offer (the “Tender
Offer”) by the Company for up to 100% of the Company’s
issued and outstanding shares of common stock for $9.00 per
share. The Tiptree equity investment and the Tender Offer are
referred to herein as the “Tiptree Transaction.”
QUESTIONS
AND ANSWERS ABOUT THE ANNUAL MEETING
What is
the purpose of the meeting?
At the Annual Meeting, stockholders will be asked to vote on:
| • | the election of seven (7) directors to serve until the 2011 annual meeting of stockholders or until their successors are duly elected and qualified; | |
| • | the ratification of the selection of Deloitte & Touche LLP as our independent auditors for the fiscal year ending December 31, 2010; and | |
| • | any other matters that may properly be brought before the Annual Meeting or at any adjournments or postponements thereof. |
How does
the Board recommend I vote on these proposals?
The Board of Directors recommends a vote:
| • | FOR the election of the following seven (7) nominees to the Board of Directors: Michael G. Barnes, Flint D. Besecker, Geoffrey N. Kauffman, William A. Houlihan, Jonathan Ilany, Salvatore (Torey) V. Riso, Jr. and J. Rainer Twiford; and | |
| • | FOR the ratification of the selection of Deloitte & Touche LLP as our independent auditors for the fiscal year ending December 31, 2010. |
Who is
entitled to vote at the meeting?
If our records show that you were a holder of our common stock
at the close of business on November 15, 2010, which is
referred to in this proxy statement as the “record
date,” you are entitled to receive notice of the meeting
and to vote the shares of common stock that you held on the
record date.
iii
Table of Contents
How many
shares can vote?
As of the close of business on the record date,
10,064,982 shares of common stock of Care were issued and
outstanding and entitled to vote. There is no other class of
voting securities outstanding. You are entitled to one
(1) vote for each share of common stock you held as of the
close of business on the record date.
What
constitutes a quorum?
A quorum refers to the number of shares that must be in
attendance at a meeting to lawfully conduct business. The
presence in person or by proxy of stockholders entitled to cast
a majority of all of the votes entitled to be cast shall
constitute a quorum for the transaction of business at the
meeting.
How are
“broker non-votes” and abstentions treated for quorum
purposes?
The inspector of elections will treat shares referred to as
“broker non-votes” (that is, shares held by brokers or
nominees as to which instructions have not been received from
the beneficial owners or persons entitled to vote and that the
broker or nominee does not have discretionary power to vote on a
particular matter) as shares that are present and entitled to
vote for purposes of determining the presence of a quorum. We
will also treat abstentions as shares that are present and
entitled to vote for purposes of determining the presence or
absence of a quorum. We believe that the election of directors
is not considered a “discretionary” voting item and
the ratification of independent auditors is considered a
“discretionary” voting item, and, as a result, your
broker or nominee should not be permitted to vote your shares in
the absence of specific voting instructions from you regarding
the election of directors but should be permitted to vote your
shares in the absence of specific voting instructions from you
regarding the ratification of independent auditors.
What vote
is needed to approve each proposal?
Election
of Directors
The affirmative vote of the holders of record of a plurality of
all of the votes cast at the meeting at which a quorum is
present is necessary for the election of the directors.
Ratification
of Independent Auditors
The affirmative vote of the holders of record of a majority of
all of the votes cast at the meeting at which a quorum is
present is required for the ratification of the selection of our
independent auditors and the ratification of any other matters
properly presented at the meeting for stockholder approval.
How are
“broker non-votes” and abstentions treated for
purposes of the proposals?
Abstentions do not constitute a vote “for” or
“against” either matter being voted on at the Annual
Meeting and will not be counted as “votes cast.”
Therefore, abstentions will have no effect on any of the
proposals. “Broker non-votes” will be treated in the
same manner as abstentions for purposes of the Annual Meeting.
We believe that the election of directors is not considered a
“discretionary” voting item and the ratification of
independent auditors is considered a “discretionary”
voting item, and, as a result, your broker or nominee should not
be permitted to vote your shares in the absence of specific
voting instructions from you regarding the election of directors
but should be permitted to vote your shares in the absence of
specific voting instructions from you regarding the ratification
of independent auditors.
iv
Table of Contents
Can I
change my vote after I submit my proxy card or give instructions
over the Internet or telephone?
Yes. After you have submitted a proxy, you may revoke it at any
time before it is voted by:
| • | filing a written notice revoking the proxy with our Secretary at our address; | |
| • | signing and forwarding to us a proxy with a later date; or | |
| • | appearing in person and voting by ballot at the meeting. |
Whether or not you vote using a traditional proxy card, through
the Internet or by telephone, you may use any of those three
methods to change your vote. Accordingly, you may change your
vote either by submitting a proxy card prior to or at the Annual
Meeting or by voting again before 11:59 p.m., Eastern
Standard Time, on December 19, 2010, the time at which the
Internet and telephone voting facilities close. The later
submitted vote will be recorded and the earlier vote revoked. If
you attend the Annual Meeting, you may vote in person whether or
not you have previously given a proxy, but your presence
(without further action) at the meeting will not constitute
revocation of a previously given proxy.
How do I
vote?
Our proxy materials are being mailed to our stockholders on or
about November 22, 2010. The Internet and telephone voting
facilities for stockholders of record will close at
11:59 p.m., Eastern Standard Time, on December 19,
2010.
If your shares of common stock are held by a broker, bank or
other nominee ( i.e., in “street name”), you will
receive instructions from your nominee, which you must follow in
order to have your shares of common stock voted. Such
stockholders who wish to vote in person at the meeting will need
to obtain a proxy form from the broker, bank or other nominee
that holds their shares of common stock of record.
How is my
vote counted?
If you vote through the Internet, by phone or properly execute a
proxy in the accompanying form, and if we receive it prior to
voting at the meeting, the shares of common stock that the proxy
represents will be voted in the manner specified on the proxy.
If no specification is made in the proxy, the common stock will
not be voted regarding the election of the director nominees
named in this proxy statement but will be voted for the
ratification of our Audit Committee’s appointment of
Deloitte & Touche LLP as our independent auditors for
the fiscal year ending December 31, 2010. It is not
anticipated that any matters other than those set forth in the
proxy statement will be presented at the Annual Meeting. If
other matters are presented, proxies will be voted in accordance
with the discretion of the proxy holders. In addition, no
stockholder proposals or nominations were received on a timely
basis, so no such matters may be brought to a vote at the Annual
Meeting.
What
other information should I review before voting?
The proxy materials include our 2009 Annual Report, which is
comprised of our Annual Report on
Form 10-K
(as amended by that certain
Form 10-K/A
filed on April 30, 2010 and that certain
Form 10-K/A
filed on July 15, 2010). In addition, our 2009 Annual
Report on
Form 10-K
is available, free of charge, on our website at
http://www.carereit.com.
The information found on, or accessible through, our website is
not incorporated into, and does not form a part of, this proxy
statement or any other report or document we file with or
furnish to the SEC. You may also obtain a copy of our 2009
Annual Report on
Form 10-K,
free of charge, by directing your request in writing to Care
Investment Trust Inc., 780 Third Avenue, 21st Floor,
New York, NY 10017, Attention: Steven M. Sherwyn, Secretary and
Chief Compliance Officer.
v
Table of Contents
Who is
soliciting my proxy?
This solicitation of proxies is made by and on behalf of our
Board of Directors. We will pay the cost of the solicitation of
proxies. In addition to the solicitation of proxies by mail, our
directors, officers and employees may solicit proxies personally
or by telephone.
No person is authorized on our behalf to give any information
or to make any representations with respect to the proposals
other than the information and representations contained in this
proxy statement, and, if given or made, such information
and/or
representations must not be relied upon as having been
authorized and the delivery of this proxy statement shall, under
no circumstances, create any implication that there has been no
change in our affairs since the date hereof.
vi
Table of Contents
PROPOSAL 1:
ELECTION OF DIRECTORS
Our Board of Directors currently consists of seven
(7) members. Two (2) directors were elected at the
Company’s previous annual meeting, and five
(5) directors were appointed by the Board of Directors
since the Company’s previous annual meeting. As discussed
below, pursuant to the Tiptree Transaction, four
(4) directors, Michael G. Barnes, Geoffrey N. Kauffman,
William A. Houlihan and Jonathan Ilany, were appointed by
our Board of Directors on August 13, 2010, upon the
resignation of Gerald Bisbee, Karen Robards and Steven Warden
and the decision by the Board of Directors to increase the size
of the Board of Directors from five (5) members to six
(6) members. Those four directors were appointed based on
the recommendation of Tiptree, our majority shareholder. On
November 4, 2010, our Board of Directors approved a further
increase in the size of the Board of Directors from six
(6) members to seven (7) members and appointed
Salvatore (Torey) V. Riso, Jr. to fill the resulting
vacancy effective November 16, 2010. Our Board of Directors
is nominating for re-election (or in the cases of
Mr. Barnes, Mr. Kauffman, Mr. Houlihan,
Mr. Ilany and Mr. Riso, election) all seven
(7) members of the Board of Directors. Each director
elected at the Annual Meeting will be elected to serve until our
next annual meeting. All nominees for director have consented to
be named and have agreed to serve as directors if elected. We
have no reason to believe that any of the nominees will be
unable to accept election as a director. However, in the event
that one or more nominees are unable or unwilling to accept
election or are unable to serve for any reason, the persons
named as proxies or their substitutes will have authority,
according to their judgment, to vote or refrain from voting for
such substitute as may be designated by the Board.
Our bylaws provide that a majority of the entire Board of
Directors may establish, increase or decrease the number of
directors, provided that the number of directors shall never be
less than one (1), which is the minimum number required by the
Maryland General Corporation Law, nor more than fifteen (15).
Recommendation
The Board of Directors unanimously recommends a vote
“FOR” each nominee.
Information
Regarding the Nominees for Election
The following table and biographical descriptions set forth
certain information, as of November 16, 2010, with respect
to each nominee for election as director at the Annual Meeting,
all of whom currently serve as directors.
|
Name
|
Age
|
Director Since
|
||||||
|
Nominee Directors
|
||||||||
|
Michael G. Barnes (Chairman)
|
44 | 2010 | ||||||
|
Geoffrey N. Kauffman (Vice Chairman)
|
52 | 2010 | ||||||
|
Salvatore (Torey) V. Riso, Jr.
|
48 | 2010 | ||||||
|
Flint D. Besecker
|
44 | 2007 | ||||||
|
J. Rainer Twiford
|
57 | 2007 | ||||||
|
Jonathan Ilany
|
57 | 2010 | ||||||
|
William A. Houlihan
|
55 | 2010 | ||||||
Michael G. Barnes has been a member of our Board
of Directors since August 13, 2010, and serves as our
Chairman. He has served as the chief executive officer and
chairman of Tiptree since its inception in 2007 and is a
founding partner of Tricadia Holdings, L.P. and its affiliated
companies (“Tricadia”), which are privately held and
provide investment management services. Prior to the formation
of Tricadia in 2003, Mr. Barnes spent two years as Head of
Structured Credit Arbitrage within UBS Principal Finance LLC, a
wholly owned subsidiary of UBS Warburg, which conducts
proprietary trading on behalf of the firm. Mr. Barnes
joined UBS in 2000 as part of the merger between UBS and
PaineWebber Inc. Prior to joining UBS, Mr. Barnes was a
Managing Director and
1
Table of Contents
Global Head of the Structured Credit Products Group of
PaineWebber. Prior to joining PaineWebber in 1999, he spent
12 years at Bear, Stearns & Co. Inc., the last
five of which he was head of their Structured Transactions
Group. Mr. Barnes received his A.B. from Columbia College.
Mr. Barnes was selected by Tiptree to serve as a member and
Chairman of our Board of Directors because of his extensive
experience in asset management, including the management of
credit assets, real estate, and for his experience in developing
emerging and transitional companies.
Geoffrey N. Kauffman has been a member of our
Board of Directors since August 13, 2010, and serves as our
Vice Chairman. He has served as the president and chief
operating officer of Tiptree since its inception in 2007 and has
been a Managing Director of Tricadia since 2005. Since joining
Tricadia in 2005, Mr. Kauffman has been overseeing a
variety of strategic acquisition opportunities and permanent
capital projects, including the development of Tiptree. Prior to
joining Tricadia, from 2002 to 2004, Mr. Kauffman was a
partner with the Shidler Group in a similar capacity, with his
primary focus being the development of a credit derivative
products company (CDPC). Before joining the Shidler Group, from
1997 to 2001, Mr. Kauffman was involved in the launch of
the CGA Group of companies, which originated financial guarantee
contracts. From 1997 through 1999, he was the president, Chief
Underwriting Officer and Principal Representative of CGA
Bermuda, Ltd, the CGA Group’s Bermuda based insurance
subsidiary. From 2000 to 2001, he was the president and chief
executive officer of CGA Investment Management. Prior to joining
CGA, Mr. Kauffman was at AMBAC and the
MBIA / AMBAC International joint venture in 1995 and
1996, where he helped develop their international structured
finance department. Prior to AMBAC, from 1989 to 1995,
Mr. Kauffman was with FGIC’s ABS group and helped
establish that business, focusing on CDOs, asset backed
securities and multi-seller conduit programs. Prior to FGIC,
Mr. Kauffman worked in the Investment Banking Division of
Marine Midland Bank (now HSBC), where he focused on middle
market mergers and acquisitions and structured finance.
Mr. Kauffman holds a B.A. (Psychology) from Vassar College
and an M.B.A. (Finance) from Carnegie Mellon University.
Mr. Kauffman was selected by Tiptree to serve as a member
and Vice Chairman of our Board of Directors because of his
significant and diverse experience in financial transactions,
particularly credit transactions, and real estate, as well as
his experience in developing emerging and transitional companies.
Salvatore (Torey) V. Riso Jr. was appointed to our
Board of Directors on November 4, 2010, effective as of
November 16, 2010, and has served as our President and
Chief Executive Officer since December 2009. Mr. Riso
formerly served as our secretary and chief compliance officer
from February 2008 and was employed by CIT from September 2005
through November 16, 2010, serving as senior vice president
and chief counsel of CIT Corporate Finance since March 2007.
Prior to his position at CIT Corporate Finance, Mr. Riso
served as chief counsel for CIT Healthcare LLC, our former
external manager (“CIT Healthcare”), and other
business units of CIT. Between 1997 and 2005, Mr. Riso was
in private practice in the New York office of Orrick
Herrington & Sutcliffe LLP, where he worked in
Orrick’s global finance practice group. Mr. Riso
received a B.A. in economics and history cum laude from UCLA, as
well as a J.D. from the Loyola Law School of Los Angeles.
Flint D. Besecker is our founder and has been a
member of our Board of Directors since Care was formed in 2007
and previously served as our Chairman. Mr. Besecker is a
veteran of both the commercial finance and healthcare industries
and currently runs Firestone Asset Management, a healthcare
middle market private equity business he founded in 2008.
Firestone owns a variety of private equity investments focused
on early stage life science drug development as well as
specialty pharmaceutical companies. On October 13, 2010,
Mr. Besecker was named chief executive officer of The
Center for Hospice & Palliative Care in Buffalo, New
York. In addition, Mr. Besecker was formerly a director and
Chairman of the compensation committee of Allion Healthcare, a
specialty pharmaceutical company serving patients throughout the
U.S. Mr. Besecker served as the president and founder
of our former external manager, CIT Healthcare LLC, and also
served as president of CIT Commercial Real Estate. Prior to
joining CIT Group Inc. (“CIT”) in 2004,
Mr. Besecker held a variety of executive positions
including managing director of GE Healthcare Financial Services,
executive vice president and chief risk officer of Heller
Healthcare Finance and president and co-founder of
2
Table of Contents
Healthcare Analysis Corporation. He also served as an officer of
Healthcare Financial Partners prior to its acquisition by
Heller. He received a B.S. in Accounting from Canisius College
in 1988 and is a Certified Public Accountant. Mr. Besecker
was selected to serve as a member of our Board of Directors
because of his significant achievements with, and intimate
knowledge of, the Company and his extensive experience in
healthcare and real estate.
J. Rainer Twiford has been a member of our
Board of Directors since the consummation of our initial public
offering in 2007. Since 1999, Mr. Twiford has been
president of Brookline Partners, Inc., an investment advisory
company. Prior to joining Brookline Partners, Mr. Twiford
was a partner of Trammell Crow Company from 1987 until 1991.
Mr. Twiford is currently a director of IPI, Inc., Smith of
Georgia and Tracon Pharmaceuticals, and previously served on the
board of a children’s behavioral health company.
Mr. Twiford received a BA and a Ph.D. from the University
of Mississippi, an M.A. from the University of Akron and a J.D.
from the University of Virginia. Mr. Twiford was selected
to be a member of our Board of Directors because of his
extensive high level experience in the financial industry.
Jonathan Ilany has been a member of our Board of
Directors since August 13, 2010. He has been chairman of
the board of directors of Reliance First Capital, a privately
owned mortgage company, since 2008. Since 2005, Mr. Ilany
has been a private investor and passive partner at Mariner
Investment Group. Mr. Ilany was a partner at Mariner
Investment Group from
2000-2005,
responsible for hiring and setting up new trading groups,
overseeing risk management, and he was a senior member of the
investment committee and management committee of the firm. From
1996-2000,
Mr. Ilany was a private investor and also served as interim
chief executive officer of Angiosonics, a
start-up
medical device company, and as a director of various private
companies. From
1982-1995,
Mr. Ilany was an employee of Bear Stearns & Co.
where he was a member of the board of directors. At Bear
Stearns, Mr. Ilany initiated and supervised the Fixed
Income Analytic and Structuring Group, started the whole loan
trading group and the conduit group, and in 1990 began EMC, a
specialty mortgage company designed to deal with all RTC
liquidations. Mr. Ilany then further developed EMC as a
servicing and acquisition platform for distressed mortgage
product. He shared responsibility for the Financial Institution
Group, all asset-backed securities, and he oversaw the Forex,
Commodities and Energy Trading departments. From
1980-1982,
Mr. Ilany worked at Merrill Lynch. From
1971-1975,
Mr. Ilany served in the armored corps of the Israeli
Defense Forces and he was honorably discharged holding the rank
of First Lieutenant. Mr. Ilany was selected by Tiptree to
serve as a member of our Board of Directors because of his
extensive experience in overseeing risk management and serving
on the investment committee and management committee of a major
investment firm, serving on the board of directors of various
companies and his experience with investing in real estate and
real estate-related assets.
William A. Houlihan has been a member of our Board
of Directors since August 13, 2010. He has more than
30 years of business and financial experience. Since
September 2009, he has served on the Board of Directors and as
the financial expert on the audit committee of First Physicians
Capital Group, Inc., a publicly-traded company that owns
ambulatory surgical centers and small hospitals. Since November
2003, Mr. Houlihan has served on the board of directors of
SNL Financial, a privately-held company that maintains database
financial information on financial institutions, REITs, energy,
media and other companies. During an eight-year period from 2001
through 2008, Mr. Houlihan was a private investor while he
served as transitional Chief Financial Officer for several
distressed companies: Sixth Gear, Inc. from October 2007 to
November 2008, Sedgwick Claims Management Services from August
2006 until January 2007, Metris Companies from August 2004 to
January 2006, and Hudson United Bancorp from January 2001 to
November 2003. Mr. Houlihan also worked as an investment
banker at UBS from June 2007 to September 2007, J.P. Morgan
Securities from November 2003 to July 2004, KBW, Inc. from
October 1996 to January 2001, Bear, Stearns & Co.,
Inc. from April 1991 to October 1996, and Goldman
Sachs & Co. from June 1981 to April 1991. He also held
several auditing and accounting positions from June 1977 through
June 1981. Mr. Houlihan received a B.S., Magna Cum Laude in
Accounting in 1977 from Manhattan College, became licensed as a
Certified
3
Table of Contents
Public Accountant in 1979, and received his M.B.A. in Finance in
1983 from New York University Graduate School of Business.
Mr. Houlihan was selected by Tiptree to serve as a member
of our Board of Directors because of his diverse financial
experience, including his service on the boards of directors of
several small capitalization, high-growth companies, as chief
financial officer of transitional public and privately-held
companies and his extensive accounting background.
Executive
Officers and Executive Committee
Salvatore (Torey) V. Riso, Jr. has served as our President
and Chief Executive Officer since December 2009. Our Board of
Directors appointed Steven M. Sherwyn as our new Chief Financial
Officer, Treasurer, Secretary and Chief Compliance Officer as of
November 4, 2010.
Our Board of Directors, in August 2010, appointed an
“Executive Committee” comprised of Mr. Riso,
Michael G. Barnes, the Chairman of our Board of Directors, and
Geoffrey N. Kauffman, the Vice Chairman of our Board of
Directors, to implement the policies of the Company, as
determined by the Board of Directors, and to assist in
management of the Company’s
day-to-day
business, operations, activities and affairs.
The following sets forth biographical information regarding
Steven M. Sherwyn as of November 16, 2010. The biographies
for Michael G. Barnes, Geoffrey N. Kauffman and Salvatore
(Torey) V. Riso, Jr. are included above under
“Information Regarding the Nominees for Election.”
Steven M. Sherwyn, age 49, was appointed to
serve as our Chief Financial Officer, Treasurer, Secretary and
Chief Compliance Officer on November 4, 2010, replacing
Paul F. Hughes. Mr. Sherwyn has over 24 years of
finance, legal and real estate experience. Mr. Sherwyn
served as a director, senior director and managing director of
Hypo Real Estate Capital Corp. from 2004 to 2006, 2006 to 2007
and 2007 to 2008, respectively. He also served as chief
financial officer and treasurer for Quadra Realty Trust, a real
estate investment trust, from 2007 to 2008. Finally,
Mr. Sherwyn served as chief financial officer for Galiot
Capital Corporation from 2008 to 2009 and chief financial
officer of Western Asset Mortgage Capital Corporation in 2009,
both real estate investment trusts. Mr. Sherwyn is a
graduate of The Wharton School of the University of Pennsylvania
with a B.S. in economics. Mr. Sherwyn also received a J.D.
from Stanford University Law School and an LL.M. in taxation
from New York University Law School.
The Board
of Directors and its Committees
Our Board of Directors presently consists of seven
(7) members. Two (2) directors were elected at the
Company’s previous annual meeting, and five
(5) directors were appointed by the Board of Directors
since the Company’s previous annual meeting. Pursuant to
the Tiptree Transaction, four (4) members, Michael G.
Barnes, Geoffrey N. Kauffman, William A. Houlihan and
Jonathan Ilany, were appointed in August 2010 to fill the
vacancies on our Board created by the resignation of Gerald
Bisbee, Karen Robards and Steven Warden and by the increase of
the size of the Board of Directors from five (5) members to
six (6) members. On November 4, 2010, our Board of
Directors approved a further increase in the size of the Board
of Directors from six (6) members to seven (7) members
and appointed Salvatore (Torey) V. Riso, Jr. to fill the
resulting vacancy effective as of November 16, 2010. The
Board has affirmatively determined that Messrs. Twiford,
Besecker, Houlihan and Ilany, representing a majority of its
members, are independent within the Company’s definition of
independence.
The Board of Directors currently has three (3) standing
committees: an Audit Committee, a Compensation, Nominating and
Governance Committee (the “CNG Committee”) and an
Executive Committee, as described above.
During fiscal year 2009, our Board of Directors held fourteen
(14) meetings, our Audit Committee held three
(3) meetings, our Compensation Committee held three (3)
meetings and our Nominating, Governance and Investment Oversight
Committee (the “NCGIO Committee”) held three
(3) meetings. Flint D. Besecker attended at least 75% of
the combined total number of meetings of our Board of
4
Table of Contents
Directors during 2009, and J. Rainer Twiford attended at
least 75% of the combined total number of meetings of our Board
of Directors and Committees of the Board on which he served
during 2009. Our remaining directors have attended at least 75%
of the combined total number of meetings of our Board of
Directors and Committees of the Board on which they serve since
their appointment.
Audit
Committee
Our Board of Directors has established an audit committee that
meets the definition provided by Section 3(a)(58)(A) of the
Securities Exchange Act of 1934, as amended. The Audit Committee
is comprised of three (3) of our independent directors:
Messrs. Twiford, Houlihan and Ilany. In addition to
satisfying the Company’s own definition of independence,
our Audit Committee members satisfy the definition of
independence imposed by
Rule 10A-3
under the Securities Exchange Act of 1934, as amended.
Mr. Houlihan became Chairman of the committee on
August 26, 2010 and has been determined by our Board of
Directors to be an “audit committee financial expert”
as that term is defined in the Securities Exchange Act of 1934,
as amended.
The Audit Committee assists the Board of Directors in overseeing:
| • | the quality and integrity of our financial statements, and accounting and reporting processes; | |
| • | our compliance with legal and regulatory requirements; | |
| • | the qualifications and independence of our independent auditors; | |
| • | the performance of our internal audit and credit audit functions; | |
| • | the performance of our independent auditors; | |
| • | our related person transaction policy; and | |
| • | our major financial risk exposures and our risk assessment, risk management guidelines and policies. |
The Audit Committee is also responsible for engaging the
independent auditors, reviewing with the independent auditors
the plans and results of the audit engagement, approving
professional services provided by the independent auditors and
considering the range of audit and non-audit fees.
Compensation,
Nominating and Corporate Governance Committee
The CNG Committee is comprised of our four (4) independent
directors: Messrs. Twiford, Besecker, Houlihan and Ilany.
Mr. Besecker became Chairman of the committee on
September 30, 2010. The CNG Committee is responsible for:
| • | establishing our corporate goals and objectives relevant to the Chief Executive Officer’s compensation, evaluating the Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the compensation of the Chief Executive Officer considering the Chief Executive Officer’s performance in light of such goals and objectives; | |
| • | reviewing and recommending to the Board of Directors the compensation of our executive officers (other than Chief Executive Officer), considering our corporate goals and objectives and evaluating such executive officer’s performance in light of such goals and objectives; | |
| • | supervising, controlling and evaluating the activities and performance of TREIT Management, LLC (“TREIT”), an affiliate of Tiptree, under the Services Agreement (defined below), reviewing our goals and objectives with respect to the Services Agreement and reviewing the compensation paid to TREIT pursuant to the Services Agreement; | |
| • | administering our incentive plans; |
5
Table of Contents
| • | reviewing and approving the disclosure regarding our compensation and benefit matters (and other items as may be required by Item 407(e)(5) to be disclosed in our compensation committee report) in our proxy statement and Annual Report; | |
| • | reviewing and discussing with Care’s management the Compensation Discussion and Analysis required by Item 402; | |
| • | identifying, recruiting and recommending to the full Board of Directors qualified candidates for election as directors and recommending a slate of nominees for election as directors at the annual meeting of stockholders; | |
| • | developing and recommending to the Board of Directors corporate governance guidelines and policies; | |
| • | overseeing the evaluation of the structure, duties, size, membership and functions of the Board of Directors and its committees and recommending appropriate changes to the Board of Directors; and | |
| • | establishing procedures to exercise oversight of the evaluation of the Board of Directors and its committees and members (including a self-evaluation). |
Director
Compensation
Pursuant to the Tiptree Transaction, all but two of our
directors who were paid compensation during the fiscal year
ended December 31, 2009, resigned and were replaced by
Tiptree designees. More recently, effective November 16,
2010, Mr. Riso was also appointed to our Board of Directors.
The following table sets forth information regarding the
compensation paid to, and the compensation expense we recognized
with respect to, our Board of Directors as it was comprised
during the fiscal year ended December 31, 2009:
|
Fees Earned or |
||||||||||||
|
Paid in |
Stock |
|||||||||||
|
Cash |
Awards |
Total |
||||||||||
|
Name
|
($) | ($)(1) | ($) | |||||||||
|
Flint D.
Besecker(2)
|
$ | 51,974 | $ | 49,983 | $ | 101,956 | ||||||
|
Gerald E. Bisbee, Jr., Ph.D.
|
$ | 57,517 | $ | 49,983 | $ | 107,500 | ||||||
|
Kirk E.
Gorman(3)
|
$ | 45,012 | $ | 37,488 | $ | 82,500 | ||||||
|
Alexandra
Lebenthal(4)
|
$ | 50,017 | $ | 49,983 | $ | 100,000 | ||||||
|
Karen P. Robards
|
$ | 57,017 | $ | 49,983 | $ | 107,000 | ||||||
|
J. Rainer Twiford
|
$ | 55,017 | $ | 49,983 | $ | 105,000 | ||||||
|
Steven N.
Warden(5)
|
$ | 0 | $ | 123,900 | $ | 123,900 | ||||||
| (1) | Amounts recognized by the Company for financial statement reporting purposes in the fiscal year ended December 31, 2009 in accordance with Accounting Standards Codification 718 — Compensation — Stock Compensation. See Footnote 14 to our Consolidated Financial Statements in our Annual Report on Form 10-K. In accordance with SEC rules, estimates of forfeitures related to service-based conditions have been disregarded. As discussed below, each director, except for Mr. Warden, received an annual retainer payable half in cash and half in unrestricted shares of our common stock. These unrestricted shares were granted in approximately equal amounts per quarter in arrears and were based on the closing price of our common stock on the last business day of each quarter. The grant date fair market value of our common stock as of the ends of each of the fiscal quarters in 2009 were $7.78, $7.67, $5.20 and $5.46, respectively. | |
| (2) | Mr. Besecker was granted 10,000 RSUs on November 5, 2009, that were structured to vest in four equal installments beginning on the first anniversary of the grant date. In addition, on December 10, 2009, Mr. Besecker was awarded a performance share award with a threshold, target and maximum award of 2,500, 5,000, and 10,000 shares, respectively. The grant date fair value of the award assuming the achievement of the highest level of performance is $79,800. On February 23, 2010, our Board amended the performance share awards. See “Performance Share Award to Mr. Besecker” below for more information on the amendment. The grant date fair value of the award on February 23, 2010 for the highest level of performance is $83,200. | |
| (3) | Mr. Gorman resigned from the Board of Directors on October 19, 2009. |
6
Table of Contents
| (4) | Ms Lebenthal resigned from the Board of Directors on January 28, 2010. | |
| (5) | Mr. Warden was granted 15,000 RSUs on May 7, 2009 that were structured to vest in four equal installments beginning on the first anniversary of the grant date. |
Before August 13, 2010, each independent director received
an annual retainer of $100,000. The annual retainer payable to
our independent directors was payable quarterly in arrears, half
in cash and half in unrestricted stock. Any portion of the
annual retainer that an independent director received in stock
was granted pursuant to our 2007 Equity Plan. Before
August 13, 2010, the Chairman of our Board of Directors was
entitled to receive an additional annual retainer of $10,000
payable quarterly in arrears. Prior to January 28, 2010,
the Chairs of our Audit Committee and our former NCGIO Committee
were each entitled to receive an additional annual retainer of
$7,500, and the Chairman of our former Compensation Committee
was entitled to receive an additional annual retainer of $5,000,
in each case payable quarterly in arrears. Effective
January 28, 2010, the Compensation Committee and NCGIO
Committee were combined into the CNG Committee. After
January 28, 2010 but before August 13, 2010, the Chair
of our CNG Committee was entitled to receive an additional
annual retainer of $7,000. These additional retainer amounts
paid to our Board and committee chairs were payable in cash. In
addition, we reimbursed all directors for reasonable
out-of-pocket
expenses incurred in connection with their services on our Board
of Directors.
On September 30, 2010, effective August 13, 2010, we
changed our director compensation package such that each of the
non-management directors is entitled to receive an annual
retainer of $50,000, of which $15,000 will be paid in the form
of Company stock. The annual retainer will be paid quarterly in
arrears, commencing with the quarter ended September 30,
2010. The chairs of the CNG Committee and Audit Committee will
be paid additional retainers of $5,000 in cash. Mr. Barnes,
Mr. Kauffman and Mr. Riso, as management directors,
will not receive any compensation for their service on the Board
of Directors.
7
Table of Contents
CORPORATE
GOVERNANCE MATTERS
This section of our proxy statement contains information about a
variety of our corporate governance policies and practices. We
are committed to operating our business under strong and
accountable corporate governance practices. You are encouraged
to visit the corporate governance section of our corporate
website at
http://www.carereit.com
to view or to obtain copies of the respective charters of
our Board Committees, our Code of Business Conduct, Corporate
Governance Guidelines and our Definition of an Independent
Director. The information found on, or accessible through, our
website is not incorporated into, and does not form a part of,
this proxy statement or any other report or document we file
with or furnish to the SEC. You may also obtain, free of charge,
a copy of the respective charters of our Board Committees, Code
of Business Conduct, Corporate Governance Guidelines and our
Definition of an Independent Director by directing your request
in writing to Care Investment Trust Inc., 780 Third Avenue,
21st Floor, New York, NY 10017, Attention: Steven M.
Sherwyn, Secretary and Chief Compliance Officer. Additional
information relating to the corporate governance of the Company
is included above in the section entitled “Proposal 1:
Election of Directors.”
Corporate
Governance Guidelines
Our Board of Directors has adopted Corporate Governance
Guidelines that address significant issues of corporate
governance and set forth procedures by which our Board carries
out its responsibilities. Among the areas addressed by the
Corporate Governance Guidelines are director qualification
standards, director responsibilities, director relationship and
access to management and independent advisors, director
compensation, director orientation and continuing education,
management succession, annual performance evaluation of the
Board and management responsibilities. Our CNG Committee is
responsible for assessing and periodically reviewing the
adequacy of the Corporate Governance Guidelines and will
recommend, as appropriate, proposed changes to the Board.
Director
Resignation Policy
Previously, we maintained a director resignation policy that
required a director to tender his or her resignation if he or
she failed to receive a majority of the votes cast in our annual
director elections. On November 4, 2010, our Board of
Directors approved an amendment to our Corporate Governance
Guidelines to remove the director resignation policy.
Director
Independence
Our Corporate Governance Guidelines require that a majority of
the Board be composed of directors who meet our independence
criteria as set forth in the Corporate Governance Guidelines
(which currently track the definition of director independence
included in the New York Stock Exchange’s Listed Company
Manual). Our common stock was suspended from trading on the
New York Stock Exchange on August 26, 2010, and we
anticipate that the New York Stock Exchange will delist our
common stock.
Code of
Business Conduct
Our Board of Directors has adopted a Code of Business Conduct
that applies to our directors, executive officers, as well as
employees of TREIT or its affiliates that provide services to
us. The Code of Business Conduct was designed to assist our
directors and executive officers, as well as employees of TREIT
or its affiliates that provide services to us, in complying with
the law, resolving moral and ethical issues that may arise and
in complying with our policies and procedures. Among the areas
addressed by the Code of Business Conduct are compliance with
applicable laws, conflicts of interest, use and protection of
our Company’s assets, confidentiality, communications with
the public, accounting matters, records retention and
discrimination and harassment.
8
Table of Contents
Communications
with our Board of Directors
We have a process by which stockholders
and/or other
parties may communicate with our Board of Directors, our
independent directors as a group or our individual directors.
Any such communications may be sent to our Board by
U.S. mail or overnight delivery and should be directed to
the Board of Directors, a Committee, the independent directors
as a group, or an individual director,
c/o Steven
M. Sherwyn, Secretary and Chief Compliance Officer, at Care
Investment Trust Inc., 780 Third Avenue, 21st Floor,
New York, NY 10017, who will forward such communications on to
the intended recipient. Any such communications may be made
anonymously. In addition, stockholder communications can be
directed to the Board by calling the Care hotline listed on our
website.
Whistleblowing
and Whistleblower Protection Policy
Our Audit Committee has established procedures for (1) the
receipt, retention and treatment of complaints received by our
Company regarding accounting, internal accounting controls or
auditing matters and (2) the confidential and anonymous
submission by our employees of concerns regarding questionable
accounting or auditing matters. If you wish to contact our Audit
Committee to report complaints or concerns relating to the
financial reporting of our Company, you may do so in writing to
the Chairman of our Audit Committee,
c/o Steven
M. Sherwyn, Secretary and Chief Compliance Officer, Care
Investment Trust Inc., 780 Third Avenue, 21st Floor,
New York, NY 10017. Any such communications may be made
anonymously.
Director
Attendance at Annual Meetings
Pursuant to our Corporate Governance Guidelines, we expect each
member of our Board of Directors to attend each annual meeting
of stockholders.
Identification
of Director Candidates
Our CNG Committee assists our Board of Directors in identifying
and reviewing director candidates to determine whether they
qualify for membership on the Board of Directors and for
recommending to the Board the director nominees to be considered
for election at our annual meetings of stockholders.
In making recommendations to our Board, our CNG Committee
considers such factors as it deems appropriate. The Board seeks
diversity in its members with respect to background, skills and
expertise, industry knowledge and experience. The CNG Committee
uses the following general criteria for identifying director
candidates:
| 1. | Directors should possess senior level management and decision-making experience; |
| 2. | Directors should have a reputation for integrity and abiding by exemplary standards of business and professional conduct; | |
| 3. | In selecting director nominees, the Board should seek candidates with the commitment and ability to devote the time and attention necessary to fulfill their duties and responsibilities to Care and its stockholders; | |
| 4. | Directors should be highly accomplished in their respective field, with leadership experience in corporations or other complex organizations, including government, educational and military institutions; | |
| 5. | In addition to satisfying the independence criteria described in the Corporate Governance Guidelines, independent directors should be able to represent all stockholders of Care; | |
| 6. | Directors who are expected to serve on a Committee of the Board shall satisfy applicable legal requirements and other criteria established by any securities exchange on which our common stock is listed; |
9
Table of Contents
| 7. | Directors should have the ability to exercise sound business judgment to provide advice and guidance to the Chief Executive Officer with candor; and |
| 8. | The Board’s assessment of a director candidate’s qualifications includes consideration of diversity, age, skills and experience in the context of the needs of the Board. |
The foregoing general criteria apply equally to the evaluation
of all potential independent and management director nominees,
including those individuals recommended by stockholders.
Our CNG Committee may solicit and consider suggestions of our
directors, Tiptree or its affiliates (including TREIT) or our
management regarding possible nominees. As discussed above in
“Proposal 1: Election of Directors,”
Messrs. Barnes, Kauffman, Ilany and Houlihan candidacies
were recommended to our CNG Committee by Tiptree. The candidacy
of Salvatore (Torey) Riso Jr., was also recommended to our CNG
Committee by Tiptree. Our CNG Committee may also procure the
services of outside sources or third parties to assist in the
identification of director candidates.
Our CNG Committee may consider director candidates recommended
by our stockholders. Our CNG Committee will apply the same
standards in considering candidates submitted by stockholders as
it does in evaluating candidates submitted by members of our
Board, Tiptree or its affiliates (including TREIT) or our
management. Any recommendations by stockholders should follow
the procedures outlined under “Other Matters —
Stockholder Proposals” in this proxy statement and should
also provide the reasons supporting a candidate’s
recommendation, the candidate’s qualifications and the
candidate’s written consent to being considered as a
director nominee. In addition, any stockholder recommending a
director candidate should submit information demonstrating the
number of shares of common stock that he or she owns.
Executive
Sessions of Independent Directors
In accordance with our Corporate Governance Guidelines, the
independent directors serving on our Board of Directors
regularly meet in executive session without the presence of any
directors or other persons who are part of our management. Our
executive sessions are chaired by our Lead Director. Flint D.
Besecker was appointed “Lead Director” on
September 30, 2010. Interested parties may communicate
directly with the Lead Director or our independent directors as
a group through the process set forth above under
“Communications with our Board of Directors.”
Current
Board Leadership Structure
Our Board of Directors is led by Michael G. Barnes, the Chairman
of the Board of Directors, and Geoffrey N. Kauffman, the Vice
Chairman of the Board of Directors. Mr. Barnes serves as
the chief executive officer and chairman of Tiptree.
Mr. Kauffman serves as the president and chief operating
officer of Tiptree. Tiptree is our majority stockholder and an
affiliate of TREIT, which provides advisory services to us
pursuant to a Services Agreement (discussed below).
Mr. Barnes and Mr. Kauffman are each executive
officers of TREIT. Our Board of Directors recently appointed an
“Executive Committee” comprised of Michael G. Barnes,
Geoffrey N. Kauffman and Salvatore (Torey) V. Riso, Jr.,
our President and Chief Executive Officer, to implement the
policies of the Company, as determined by the Board of
Directors, and to assist in management of the Company’s
day-to-day
business, operations, activities and affairs. To help ensure
that the Board of Directors carries out its oversight
responsibilities, our Governance Guidelines require the Board of
Directors as a whole to maintain independence from management.
Pursuant to the Governance Guidelines, a majority of the Board
of Directors must be independent. As of the date hereof, four
(4) of our current seven (7) directors have been
determined to be independent.
Because the Chairman and Vice Chairman of the Board of Directors
are not independent, the Board of Directors appointed
Mr. Besecker to serve as the Company’s Lead Director
and provide the following services to the Company: review and
provide input with respect to Board of Directors
10
Table of Contents
meeting agendas, preside at executive sessions of the
independent directors and preside at meetings of the Board of
Directors when the Chairman or Vice Chairman is not present.
The Board of Directors believes that this structure is
appropriate due to TREIT’s position as advisor to the
Company pursuant to the Services Agreement (discussed below).
The Board of Directors also believes that this structure allows
the Company to better utilize the experience of Mr. Barnes
and Mr. Kauffman.
Board’s
Role in Risk Oversight
Our Board oversees our business in general, including risk
management and performance of the Chief Executive Officer and
other members of senior management, to assure that the long-term
interests of the stockholders are being served. Each committee
of our Board is also responsible for reviewing the risk exposure
related to such committee’s areas of responsibility and
providing input to senior management on such risks.
Management and our Board have a process to identify, analyze,
manage and report all significant risks facing us. Our Chief
Executive Officer will regularly report to the Board on
significant risks facing us, including legal, financial,
operational and strategic risks. The Audit Committee reviews
with senior management significant risks related to the Company
and periodically reports to the Board on such risks.
In addition, pursuant to its charter, the Audit Committee is
responsible for reviewing and discussing the Company’s
business risk management process, including the quality and
integrity of Care’s financial statements, and accounting
and reporting processes; Care’s compliance with legal and
regulatory requirements; the independent auditors’
qualifications and independence; and the performance of
Care’s internal audit and credit audit functions.
Furthermore, the Audit Committee evaluates key financial
statement issues and risks, their impact or potential effect on
reported financial information and the process used by
management to address such matters. At each Audit Committee
meeting, management briefs the committee on the current business
and financial position of the Company, as well as such items as
internal audits and independent audits.
CNG
Committee Interlocks and Insider Participation
There are no CNG Committee interlocks and none of our executive
officers participate on our CNG Committee.
11
Table of Contents
PROPOSAL 2:
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Our Audit Committee has appointed the accounting firm of
Deloitte & Touche LLP to serve as our independent
auditors for the fiscal year ending December 31, 2010,
subject to ratification of this appointment by our common
stockholders. Deloitte & Touche LLP has served as our
independent auditors since our formation and is considered by
our management to be well-qualified. Deloitte & Touche
LLP has advised us that neither it nor any member thereof has
any financial interest, direct or indirect, in our Company or
any of our subsidiaries in any capacity.
A representative of Deloitte & Touche LLP will be
present at the Annual Meeting, will be given the opportunity to
make a statement if he or she so desires and will be available
to respond to appropriate questions.
Audit
Fees
Fees for audit services totaled approximately $865,500 in 2008,
which represent audit fees associated with our annual audit,
reviews of our quarterly reports on
Form 10-Q,
review of documents filed with the SEC and a consent. In
addition, fees for audit-related services totaled $152,500 for
compliance with internal controls and purchase price allocation.
Fees for audit services totaled approximately $821,000 in 2009,
which represent audit fees associated with our annual audit,
reviews of our quarterly reports on
Form 10-Q,
review of documents filed with the SEC and a consent. There were
no fees for audit-related services in 2009.
There were no tax fees or other fees paid to
Deloitte & Touche LLP in 2008 and 2009.
Pre-Approval
Policies and Procedures of our Audit Committee
Our Audit Committee has sole authority (with the input of
management) to approve in advance all engagements of our
independent auditors for audit or non-audit services. All audit
services provided by Deloitte & Touche LLP in 2009
were pre-approved by our Audit Committee.
Recommendation
Our Board of Directors unanimously recommends a vote
“FOR” the ratification of the appointment of
Deloitte & Touche LLP as our independent auditors for
the fiscal year ending December 31, 2010.
12
Table of Contents
The Audit Committee Report below was filed by our Audit
Committee in our
Form 10-K/A
on April 30, 2010. Gerald E. Bisbee and Karen P. Robards
are not serving on the Company’s Board of Directors as of
the date of this definitive proxy statement.
AUDIT
COMMITTEE REPORT
The Audit Committee oversees our financial reporting process on
behalf of our Board of Directors, in accordance with our Audit
Committee Charter. Management has the primary responsibility for
the preparation and presentation and integrity of our financial
statements and has represented to the Audit Committee that such
financial statements were prepared in accordance with generally
accepted accounting principles. In fulfilling its oversight
responsibilities, our Audit Committee reviewed the audited
financial statements in the Annual Report on
Form 10-K
for the year ended December 31, 2009 with management,
including a discussion of the quality, not just the
acceptability, of the accounting principles, the reasonableness
of significant judgments and the clarity of disclosures in the
financial statements.
The Audit Committee reviewed with our independent auditors, who
are responsible for auditing our financial statements and for
expressing an opinion on the conformity of those audited
financial statements with accounting principles generally
accepted in the United States, their judgment as to the quality,
not just the acceptability, of our accounting principles and
such other matters as are required to be discussed with the
Audit Committee under Statement on Auditing Standards
No. 61 (Communication with Audit Committees), as currently
in effect. Our independent auditors also provided to the Audit
Committee the written disclosures required by the applicable
requirements of the Public Company Accounting Oversight Board
relating to the independent accountant’s communications
with the Audit Committee concerning independence. In addition,
the Audit Committee discussed with our independent auditors the
auditors’ independence from both management and our Company.
The Audit Committee discussed with our independent auditors the
overall scope and plans for their audit. The Audit Committee met
with our independent auditors, with and without management
present, to discuss the results of their examinations, and the
overall quality of our financial reporting.
In reliance on the reviews and discussions referred to above,
the Audit Committee recommended to our Board of Directors that
the audited financial statements be included in the Annual
Report on
Form 10-K
for the year ended December 31, 2009 for filing with the
SEC.
Submitted by our Audit Committee
Gerald E. Bisbee, Jr. Ph.D. (Chairman)
Karen P. Robards
J. Rainer Twiford
Karen P. Robards
J. Rainer Twiford
13
Table of Contents
EXECUTIVE
COMPENSATION
Note to
Readers
On August 13, 2010, we completed the Tiptree Transaction.
On November 4, 2010, we entered into the CIT Termination
Agreement (defined below). Pursuant to the Tiptree Transaction
and the CIT Termination Agreement, we terminated our Management
Agreement (defined below) effective November 16, 2010, and
manage our Company through a combination of internal management
and pursuant to a Services Agreement (defined below) with TREIT,
an affiliate of Tiptree, our majority stockholder. On
November 4, 2010 we entered into an employment agreement
with Mr. Riso as our President and Chief Executive Officer
effective as of November 16, 2010 (the effective date of
the CIT Termination Agreement), and on November 4, 2010, we
appointed Mr. Sherwyn as our Chief Financial Officer.
The compensation discussion and analysis and the executive
compensation tables below represent our 2009 management and
management structure and compensation paid to our executive
officers in 2009. Our 2009 executive compensation is not
expected to reflect our future compensation arrangements for our
executive officers under our new management structure. A summary
of the material terms of the executive employment contracts for
Messrs. Riso and Sherwyn are set forth below under
“Executive Employment Agreements.” We are still in the
process of determining our going forward executive compensation
philosophy and programs.
2009
Compensation Discussion and Analysis
Overview
We have no employees. We are managed by CIT Healthcare LLC, our
manager, pursuant to a Management Agreement (defined below)
between CIT Healthcare and us. All of our named executive
officers (Messrs. Riso and Hughes) are, or in the case of
Messrs. Kellman and Plenskofski, were employees of CIT
Healthcare or one of its affiliates. We have not paid, and we do
not intend to pay, any cash compensation to our executive
officers and we do not currently intend to adopt any policies
with respect thereto. We do not have agreements with any of our
executive officers or any employees of CIT Healthcare with
respect to their cash compensation. CIT Healthcare will
determine the levels of base salary and cash incentive
compensation that may be earned by our executive officers, as
CIT Healthcare may determine is appropriate. CIT Healthcare will
also determine whether and to what extent our executive officers
will be provided with pension, deferred compensation and other
employee benefits plans and programs.
Cash compensation paid to our executive officers is paid by CIT
Healthcare or its affiliates in part from the fees paid by us to
CIT Healthcare under the Management Agreement. We do not control
how such fees are allocated by CIT Healthcare to its employees.
In addition, we understand that, because the services performed
by CIT Healthcare’s employees, including our executive
officers, are not performed exclusively for us, CIT Healthcare
is not able to segregate that portion of the cash compensation
paid to our executive officers by CIT Healthcare or its
affiliates that relates to their services to us.
Equity
Compensation
Our CNG Committee, may, from time to time, grant equity awards
designed to align the interests of our executive officers with
those of our stockholders, by allowing our executive officers to
share in the creation of value for our stockholders through
stock appreciation and dividends. The equity awards granted to
our executive officers are generally subject to time-based
vesting requirements designed to promote the retention of
management and to achieve strong performance for our Company.
These awards further provide flexibility to us in our ability to
enable CIT Healthcare to attract, motivate and retain talented
individuals at CIT Healthcare. We have adopted the Care
Investment Trust Inc. 2007 Equity Plan, which provides for
the issuance of equity-based awards, including stock options,
stock
14
Table of Contents
appreciation rights, restricted stock, restricted stock units,
unrestricted stock awards and other awards based on our common
stock that may be made by us to our directors and officers and
to our advisors and consultants who are providing services to
the Company (which may include employees of CIT Healthcare and
its affiliates) as of the date of the grant of the award. Shares
of common stock issued to our independent directors with respect
to their annual retainer fees are also issued under this plan.
Our Board of Directors has delegated its administrative
responsibilities under the 2007 Equity Plan to our CNG
Committee. In its capacity as plan administrator, the CNG
Committee has the authority to make awards to eligible
directors, officers, advisors and consultants, and to determine
what form the awards will take and the terms and conditions of
the awards. Grants of equity-based or other compensation to our
Chief Executive Officer must also be approved by the independent
members of our Board.
Special
Equity Grant to Mr. Kellman
On March 13, 2009, our Board of Directors approved a
special grant of 21,440 restricted stock units to
Mr. Kellman. The award was structured to vest in four equal
installments beginning on the first anniversary of the grant
date (March 13, 2010). Our Board of Directors granted the
award to Mr. Kellman, which had a grant date fair value of
$124,995 based on our closing stock price on March 13, 2009
of $5.83 per share, to recognize his service as Chief Executive
Officer and President of the Company. Mr. Kellman resigned
from the Company on December 4, 2009. Pursuant to the terms
of his award, the 21,440 restricted stock units vested upon his
resignation.
Special
Equity Grant to Mr. Riso
On March 12, 2009, our Board of Directors approved a
special grant of 10,486 restricted stock units to Mr. Riso.
The award was structured to vest in four equal installments
beginning on the first anniversary of the grant date. Our Board
of Directors granted the award to Mr. Riso, which had a
grant date fair value of $62,497 based on our closing stock
price on March 12, 2009 of $5.96 per share, to recognize
Mr. Riso’s continued service to the Company. These
shares vested on January 28, 2010, upon the approval of the
plan of liquidation by our stockholders.
Special
Equity Grant to Mr. Hughes
On May 7, 2009, our Board of Directors approved a special
grant of 13,333 restricted stock units to Mr. Hughes. The
award was structured to vest in four equal installments
beginning on the first anniversary of the grant date. Our Board
of Directors granted the award to Mr. Hughes, which had a
grant date fair market value of $66,265 based on our closing
stock price on May 7, 2009 of $4.97 per share, to recognize
Mr. Hughes’s service to our Company as the new chief
financial officer and treasurer. These shares vested on
January 28, 2010, upon the approval of the plan of
liquidation by our stockholders.
Performance
Share Awards to Mr. Riso and Mr. Hughes
On December 10, 2009, our Board of Directors awarded
Mr. Riso and Mr. Hughes performance share awards with
target levels of 5,000 and 3,000, respectively. These awards
were amended and restated on February 23, 2010, such that
the awards are triggered upon the execution, during 2010, of one
or more of the following transactions that results in a return
of liquidity to our stockholders within the parameters expressed
in the agreement: (i) a merger or other business
combination resulting in the disposition of all of the issued
and outstanding equity securities of the Company, (ii) a
tender offer made directly to our stockholders either by us or a
third party for at least a majority of our issued and
outstanding common stock, or (iii) the declaration of
aggregate distributions by the our Board equal to or exceeding
$8.00 per share. Upon completion of the Tiptree Transaction,
which involved a cash tender offer to our stockholders at $9.00
per share, Mr. Riso and Mr. Hughes received the
maximum awards available under the performance share award
agreements, 10,000 and 6,000 shares, respectively. At $9.00
per share, these awards had a value of $90,000 and $54,000,
respectively.
15
Table of Contents
The CNG Committee Report below was filed by our CNG Committee
in our
Form 10-K/A
on April 30, 2010. Gerald E. Bisbee and Karen P. Robards
are not serving on the Company’s Board of Directors as of
the date of this definitive proxy statement, and J. Rainer
Twiford, as of the date of this definitive proxy statement, is
not the Chairman of the CNG Committee.
COMPENSATION
COMMITTEE REPORT
Our CNG Committee reviewed and discussed the Compensation
Discussion and Analysis required by Item 402(b) of
Regulation S-K
with management and, based on such review and discussions, our
CNG Committee recommended to our Board of Directors that the
Compensation Discussion and Analysis be included in the Annual
Report on
Form 10-K
for the year ended December 31, 2009 for filing with the
SEC.
Submitted by our CNG Committee
J. Rainer Twiford (Chairman)
Gerald E. Bisbee
Karen P. Robards
J. Rainer Twiford (Chairman)
Gerald E. Bisbee
Karen P. Robards
Summary
Compensation Table
The following table sets forth information regarding the
compensation paid to our named executive officers by us in 2009,
2008 and 2007.
|
Stock |
||||||||||||
|
Awards(1) |
Total |
|||||||||||
|
Name and Principal Position
|
Year | ($) | ($) | |||||||||
|
Salvatore (Torey) V. Riso
Jr.(2)
|
2008 | $ | 18,058 | $ | 18,058 | |||||||
|
Chief Executive Officer, President
|
2009 | $ | 149,933 | $ | 149,933 | |||||||
|
Paul F.
Hughes(3)
|
2009 | $ | 110,131 | $ | 110,131 | |||||||
|
Chief Financial Officer, Treasurer, Secretary & Chief
Compliance Officer
|
||||||||||||
|
F. Scott
Kellman(4)
|
2007 | $ | 75,719 | $ | 75,719 | |||||||
|
Chief Executive Officer, President
|
2008 | $ | 256,881 | $ | 256,881 | |||||||
| 2009 | $ | 966,734 | $ | 966,734 | ||||||||
|
Frank E.
Plenskofski(5)
|
2008 | $ | 0 | $ | 0 | |||||||
|
Chief Financial Officer, Treasurer
|
2009 | $ | 0 | $ | 0 | |||||||
| (1) | Amounts recognized by the Company for financial statement reporting purposes in the fiscal years ended December 31, 2007, December 31, 2008 and December 31, 2009 in accordance with Accounting Standards Codification 718 — Compensation — Stock Compensation. See Footnote 10 to our Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2007 and Footnote 14 to our Consolidated Financial Statements in our Annual Report on Form 10-K for each of the years ended December 31, 2009 and 2008. In accordance with SEC rules, estimates of forfeitures related to service-based conditions have been disregarded. | |
| (2) | Mr. Riso was not an executive officer in 2007. On December 10, 2009, Mr. Riso was awarded a performance share award with a threshold, target and maximum award of 2,500, 5,000 and 10,000 shares, respectively. The grant date fair value of the award assuming the achievement of the highest level of performance is $79,800. On February 23, 2010, our Board amended the performance share awards. See “Compensation Discussion and Analysis — Performance Share Awards to Mr. Riso and Mr. Hughes” for more information on the amendment. The grant date fair value of the award on February 23, 2010 for the highest level of performance is $83,200. | |
| (3) | Mr. Hughes was not an executive officer in 2007 and 2008. On December 10, 2009, Mr. Hughes was awarded a performance share award with a threshold, target and maximum award of 1,500, 3,000 and 6,000 shares, respectively. The grant date fair value of the award assuming the highest level of performance is $47,880. On February 23, 2010, our Board amended the performance share awards. See “Compensation Discussion and Analysis — Performance Share Awards to Mr. Riso and Mr. Hughes” for more information on the amendment. The grant date fair value of the award on February 23, 2010 for the highest level of performance is $49,920. | |
| (4) | On December 4, 2009, Mr. Kellman resigned as Chief Executive Officer and President of the Company. Pursuant to the terms of Mr. Kellman’s restricted stock and RSU awards, the restricted stock and RSU awards vested upon his resignation. In addition, upon Mr. Kellman’s resignation, we agreed that, notwithstanding the terms of his performance share award, |
16
Table of Contents
| when the determination of the payout percentage is made by our compensation committee at the end of the award period, the performance goals under the award shall be deemed to have been attained at “target” level performance, or 23,255 shares of common stock. Under the terms of the performance share award and our equity plan, stockholder approval of the plan of liquidation on January 28, 2010, resulted in the acceleration of the award period and the 23,255 shares vested. | ||
| (5) | Mr. Plenskofski resigned as Chief Financial Officer and Treasurer of the Company on March 16, 2009. In connection with his resignation, Mr. Plenskofski forfeited his RSU award. |
Grants of
Plan-Based Awards
The following table sets forth information about awards granted
to our named executive officers by us during the fiscal year
ended December 31, 2009.
|
All Other |
Grant |
|||||||||||||||||||||||||||
|
Stock |
Date |
|||||||||||||||||||||||||||
|
Awards: |
Fair |
|||||||||||||||||||||||||||
|
Number of |
Market |
Value of |
||||||||||||||||||||||||||
|
Estimated Future Payouts Under |
Shares of |
Price on |
Stock and |
|||||||||||||||||||||||||
| Equity Incentive Plan Awards | Stock or | Grant | Option | |||||||||||||||||||||||||
|
Threshold |
Target |
Maximum |
Units |
Date |
Awards |
|||||||||||||||||||||||
|
Name
|
Grant Date | (#) | (#) | (#) | (#) | ($/Sh) | ($) | |||||||||||||||||||||
|
Salvatore (Torey) V. Riso, Jr.
|
3/12/2009(2 | ) | — | — | — | 10,486 | $ | 5.96 | $ | 62,497 | ||||||||||||||||||
| 12/10/2009(1 | ) | 2,500 | 5,000 | 10,000 | — | $ | 7.98 | $ | 79,800 | |||||||||||||||||||
|
Paul F. Hughes
|
5/7/2009(2 | ) | — | — | — | 13,333 | $ | 4.97 | $ | 66,265 | ||||||||||||||||||
| 12/10/2009(1 | ) | 1,500 | 3,000 | 6,000 | — | $ | 7.98 | $ | 47,880 | |||||||||||||||||||
|
Scott F. Kellman
|
3/13/2009(3 | ) | 0 | 0 | 0 | 21,440 | $ | 5.83 | $ | 124,995 | ||||||||||||||||||
|
Frank E. Plenskofski
|
0 | 0 | 0 | 0 | — | (4) | — | (4) | ||||||||||||||||||||
| (1) | Award under the Amended and Restated Performance Share Award Agreement granted on December 10, 2009 and amended and restated on February 23, 2010. The stock award in the table above represents the maximum opportunity for Mr. Riso and Mr. Hughes, respectively, expressed as a number of RSUs. The fair value of the grants made to Mr. Riso and Mr. Hughes as of the amendment date of February 23, 2010 for highest level of performance is $83,200 and $49,920, respectively. | |
| (2) | RSU awards that were structured to vest ratably over the four period from the grant date, beginning on March 12, 2010 and May 7, 2010 for Mr. Riso and Mr. Hughes, respectively. | |
| (3) | Mr. Kellman resigned from the Company on December 4, 2009. Pursuant to the terms of this award, these RSUs vested upon his resignation. | |
| (4) | Mr. Plenskofski did not receive any equity awards in 2009. |
Outstanding
Equity Awards at Fiscal Year End
The following table sets forth certain information with respect
to all outstanding Care equity awards held by each named
executive officer at the end of the fiscal year ended
December 31, 2009.
|
Equity |
||||||||||||
|
Market |
Incentive |
|||||||||||
|
Number of |
Value of |
Plan Awards: |
||||||||||
|
Shares |
Shares or |
Number of |
||||||||||
|
or Units |
Units of |
Unearned Shares, |
||||||||||
|
of Stock |
Stock |
Units or Other |
||||||||||
|
That Have |
That Have |
Rights |
||||||||||
|
Not Vested |
Not Vested |
That Have |
||||||||||
|
Name
|
(#) | ($)(1) | Not Vested | |||||||||
|
Salvatore (Torey) V. Riso, Jr.
|
12,210(2 | ) | $ | 94,994(6 | ) | |||||||
| 10,486(2 | ) | $ | 81,581(6 | ) | ||||||||
| 5,000(7 | ) | |||||||||||
|
Paul F. Hughes
|
13,333(3 | ) | $ | 103,731(6 | ) | |||||||
| 3,000(8 | ) | |||||||||||
|
Scott Kellman
|
0(4 | ) | $ | 0(4 | ) | 23,255(9 | ) | |||||
|
Frank E. Plenskofski
|
0(5 | ) | $ | 0(5 | ) | |||||||
17
Table of Contents
| (1) | Based on the closing price of our common stock on the last business day of the fiscal year ended December 31, 2009 of $7.78. | |
| (2) | RSU awards granted on May 12, 2008 and March 12, 2009, that were structured to vest in four equal installments on the anniversaries of the grant date. Number represents portion of RSUs not yet vested as of December 31, 2009. | |
| (3) | RSU award granted on May 7, 2009, that were structured to vest in four equal installments on the anniversaries of the grant date. | |
| (4) | Mr. Kellman resigned from the Company on December 4, 2009. In connection with his resignation, Mr. Kellman’s 40,000 restricted shares and 73,882 RSUs vested, including the 21,440 RSUs granted to Mr. Kellman on March 13, 2009. In connection with the approval of the plan of liquidation by our stockholders on January 28, 2010, Mr. Kellman’s 23,255 performance shares vested. | |
| (5) | Mr. Plenskofski resigned from the Company on March 16, 2009. He forfeited his grants in connection with his resignation. | |
| (6) | All RSU awards granted vested on January 28, 2010. | |
| (7) | On December 10, 2009, Mr. Riso was awarded a performance share award with a target level of 5,000 shares. On February 23, 2010, our Board amended the performance share award. See “Compensation Discussion and Analysis — Performance Share Awards to Mr. Riso and Mr. Hughes” for more information on the award. | |
| (8) | On December 10, 2009, Mr. Hughes was awarded a performance share award with a target level of 3,000 shares. On February 23, 2010, our Board amended the performance share award. See “Compensation Discussion and Analysis — Performance Share Awards to Mr. Riso and Mr. Hughes” for more information on the award. | |
| (9) | In May 2008, Mr. Kellman was granted a performance share award to cover the performance period from January 1, 2008 through December 31, 2010. Upon Mr. Kellman’s resignation on December 4, 2009, we agreed that, notwithstanding the terms of his performance share award, when the determination of the payout percentage is made by our compensation committee at the end of the award period, the performance goals under the award shall be deemed to have been attained at “target” level performance, or 23,255 shares of common stock. Under the terms of the performance share award and our equity plan, stockholder approval of the plan of liquidation on January 28, 2010, resulted in the acceleration of the award period and the 23,255 shares vested. |
Option
Exercises and Stock Vested
We have not granted any stock options. The 40,000 shares of
restricted stock granted to Mr. Kellman at the time of our
initial public offering vested due to his termination from CIT
Healthcare (after he had resigned from Care) without cause.
Apart from Mr. Kellman, no other named executive’s
restricted shares vested during the fiscal year ended
December 31, 2009.
Pension
Benefits
Our named executive officers received no benefits in fiscal year
2009 from us under defined pension or defined contribution plans.
Nonqualified
Deferred Compensation
Our Company does not have a nonqualified deferred compensation
plan that provides for deferral of compensation on a basis that
is not tax-qualified for our named executive officers.
Potential
Payments Upon Termination or Change in Control
Our named executive officers are employees of CIT Healthcare or
its affiliates, and therefore we generally have no obligation to
pay them any form of cash compensation upon their termination of
employment, except with respect to the restricted stock award
agreements, RSU agreements and performance share award
agreements.
On January 28, 2010, our stockholders approved a plan of
liquidation, which was filed as Exhibit A to our definitive
proxy statement filed on December 28, 2009. Pursuant to the
terms of the restricted stock and RSU grant instruments and our
Equity Plan, stockholder approval of the plan of liquidation
resulted in the accelerated vesting of restricted stock and
RSUs. Therefore, our directors’ and executive
officers’ outstanding restricted stock and RSUs vested on
January 28, 2010.
18
Table of Contents
On May 12, 2008, Mr. Kellman, our former Chief
Executive Officer, was granted a performance share award to
cover the performance period from January 1, 2008 through
December 31, 2010. In connection with
Mr. Kellman’s resignation as our Chief Executive
Officer, we agreed that, notwithstanding the terms of his
performance share award, when the determination of the payout
percentage is made by our compensation committee at the end of
the award period, the performance goals under the award shall be
deemed to have been attained at “target” level
performance, or 23,255 shares of common stock. Under the
terms of the performance share award and our Equity Plan,
stockholder approval of the plan of liquidation on
January 28, 2010, resulted in the acceleration of the award
period and the 23,255 shares vested.
Messrs. Riso and Hughes were awarded performance share
awards on December 10, 2009, as amended on
February 23, 2010. If Messrs. Riso or Hughes are
terminated for “cause,” as defined in their Amended
and Restated Performance Share Award Agreements, prior to
December 31, 2010, all performance shares awarded to them
under the performance share award agreements would be
automatically forfeited. If Messrs. Riso or Hughes are
terminated for any reason other than for “cause” prior
to December 31, 2010, the individual will receive a
pro-rata percentage of the performance shares that would
otherwise be payable if he had not been terminated.
If we experienced a “change in control” as of
December 31, 2009, other than a liquidity event, the
performance period would have been deemed to have completed as
of such date, and the Company would have been deemed to have
achieved target level performance, resulting in an award of
5,000 shares of common stock to Mr. Riso and
3,000 shares of common stock to Mr. Hughes, which
would have had a fair market value as of December 31, 2009
of $38,900 and $23,340, respectively, based on our closing stock
price on December 31, 2009 of $7.78 per share.
19
Table of Contents
EXECUTIVE
EMPLOYMENT AGREEMENTS
Executive
Employment Agreement with Salvatore (Torey) Riso, Jr.
As disclosed in our
Form 8-K
filed with the SEC on November 8, 2010, on November 4,
2010, we entered into an employment agreement with Salvatore
(Torey) Riso, Jr. (the “Riso Employment
Agreement”) to be effective upon termination of the
Management Agreement between us and CIT Healthcare, which
occurred on November 16, 2010. Pursuant to the Riso
Employment Agreement, Mr. Riso continues to act as our
Chief Executive Officer and President for an initial employment
term through December 31, 2013, followed by successive one
year employment terms unless terminated by either party in
accordance with the Riso Employment Agreement. Mr. Riso is
entitled to an annual base salary of $225,000 until
December 31, 2010 and an annual base salary of $250,000 per
annum thereafter. He will also receive a one-time cash payment
of $100,000 and a one-time grant of immediately vested common
stock of the Company with a then current value of approximately
$200,000 on or about January 3, 2011. Mr. Riso is also
eligible for an annual bonus in cash and equity compensation
based upon certain annual performance targets set by our Board
of Directors or a committee thereof in its discretion. For the
year ending December 31, 2011, the annual cash bonus, if
earned, could range from $200,000 to $300,000 and the annual
equity-based bonus, if earned, could range in value from
$125,000 to $375,000. If Mr. Riso is terminated by us
without “cause” or terminates his employment for
“good reason,” each as defined in the Riso Employment
Agreement, he will be entitled to the continuation of his base
salary for the greater of (a) a period of 12 months
and (b) the number of whole months falling between the date
of termination and February 1, 2013, the full vesting of
all Company equity awards as of the date of termination and the
continuing exercisability of all stock options and stock
appreciation rights for the lesser of (x) 12 months
after the date of termination and (y) the remainder of
their term. The Riso Employment Agreement also contains a one
year non-compete period and a confidentiality restriction on
Mr. Riso.
Executive
Employment Agreement with Steven M. Sherwyn
As disclosed in our
Form 8-K
filed with the SEC on November 8, 2010, on November 4,
2010, we entered into an employment agreement with Steven M.
Sherwyn (the “Sherwyn Employment Agreement”) to be
effective immediately. Pursuant to the Sherwyn Employment
Agreement, Mr. Sherwyn will act as our Chief Financial
Officer for an initial employment term through December 31,
2013, followed by successive one year employment terms unless
terminated by either party in accordance with the Sherwyn
Employment Agreement. Mr. Sherwyn is entitled to an annual
base salary of $200,000 per annum. He will also receive a
one-time grant of 10,000 shares immediately vested common
stock of the Company on or about January 3, 2011.
Mr. Sherwyn is also eligible for an annual bonus in cash
and equity compensation based upon certain annual performance
targets set by our Board of Directors or a committee thereof in
its discretion. For the year ending December 31, 2011, the
annual cash bonus, if earned, could range from $100,000 to
$200,000 and the annual equity-based bonus, if earned, could
range in value from $150,000 to $250,000. If Mr. Sherwyn is
terminated by us without “cause” or terminates his
employment for “good reason,” each as defined in the
Sherwyn Employment Agreement, he will be entitled to the
continuation of his base salary for the greater of (a) a
period of 12 months and (b) the number of whole months
falling between the date of termination and February 1,
2013, the full vesting of all Company equity awards as of the
date of termination and the continuing exercisability of all
stock options and stock appreciation rights for the lesser of
(x) 12 months after the date of termination and
(y) the remainder of their term. The Sherwyn Employment
Agreement also contains a one year non-compete period and a
confidentiality restriction on Mr. Sherwyn.
20
Table of Contents
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership of our
common stock, as of November 16, 2010, for (1) each
person known to us to be the beneficial owner of more than 5% of
our outstanding common stock, (2) each of our directors and
(3) our directors and executive officers as a group. Except
as otherwise described in the notes below, the following
beneficial owners have sole voting power and sole investment
power with respect to all shares of common stock set forth
opposite their respective names.
In accordance with SEC rules, each listed person’s
beneficial ownership includes:
| • | all shares the investor actually owns beneficially or of record; | |
| • | all shares over which the investor has or shares voting or dispositive control (such as in the capacity as a general partner of an investment fund); and | |
| • | all shares the investor has the right to acquire within 60 days (such as upon exercise of options that are currently vested or which are scheduled to vest within 60 days). |
Unless otherwise indicated, all shares are owned directly and
the indicated person has sole voting and investment power.
Unless otherwise indicated, the business address for each
beneficial owner listed below shall be
c/o Care
Investment Trust Inc., 780 Third Avenue, 21st Floor,
New York, NY 10017.
|
Amount and Nature |
||||||||
|
of Beneficial |
||||||||
|
Ownership of |
Percent of |
|||||||
|
Name
|
Common Stock | Total(1) | ||||||
|
Tiptree Financial Partners,
L.P.(1)
|
9,277,575 | 92.2 | % | |||||
|
Salvatore (Torey) V. Riso Jr.
|
0 | * | ||||||
|
Steven M. Sherwyn
|
0 | * | ||||||
|
Michael G.
Barnes(1)
|
0 | * | ||||||
|
Geoffrey N. Kauffman
|
0 | * | ||||||
|
Flint D. Besecker
|
501 | * | ||||||
|
William A. Houlihan
|
399 | * | ||||||
|
Jonathan Ilany
|
399 | * | ||||||
|
J. Rainer Twiford
|
399 | * | ||||||
|
All Directors and Executive
|
||||||||
|
Officers as a Group (8 Persons)
|
1,698 | * | ||||||
| (1) | In a Schedule 13D filed on August 13, 2010, Tiptree Financial Partners was deemed, pursuant to Rule 13d-3 of the Securities Exchange Act of 1934, as amended, to hold shared voting and dispositive power over 9,277,575 shares of our Common Stock. By virtue of serving as the external manager of Tiptree with respect to our Common Stock, Tiptree Capital Management, LLC (“TCM”) was deemed to have shared voting and dispositive power over the shares held by Tiptree. Likewise, Tricadia Holdings, L.P. (“Tricadia Holdings”), by virtue of being a direct owner of TCM, was deemed to have shared voting and dispositive power over the shares held by Tiptree. Similarly, Tricadia Holdings GP, L.P., as general partner of Tricadia Holdings, was deemed to have shared voting and dispositive power over the shares held by Tiptree. Likewise, Mr. Arif Inayatullah, as direct owner of TCM, and Mr. Michael G. Barnes, as direct owner of TCM, were each deemed to have shared voting and dispositive power over the shares held by Tiptree. |
Section 16(a)
Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our executive
officers and directors, and persons who own more than 10% of a
registered class of our equity securities, to file reports of
ownership and changes in ownership with the SEC. Officers,
directors and persons who own more than 10% of a registered
class of our equity securities are required to furnish us with
copies of all Section 16(a) forms that they file. To our
knowledge, based solely on review of the copies of such reports
furnished to us, all Section 16(a) filing requirements
applicable to our executive officers, directors and persons who
own more than 10% of a registered class of our equity securities
were filed on a timely basis during
21
Table of Contents
2009, except that Mr. Besecker filed one (1) late
report with respect to one (1) transaction (shares
purchased through the reinvestment of dividends declared on our
common stock).
Equity
Compensation Plan Information
The following table summarizes information, as of
December 31, 2009, relating to our equity compensation
plans pursuant to which shares of our common stock or other
equity securities may be granted from time to time.
|
(c) |
||||||||||||
|
(a) |
Number of |
|||||||||||
|
Number of |
(b) |
Securities |
||||||||||
|
Securities to be |
Weighted |
Remaining |
||||||||||
|
Issued Upon |
Average |
Available for |
||||||||||
|
Exercise of |
Exercise Price of |
Future Issuance |
||||||||||
|
Outstanding |
Outstanding |
Under Equity |
||||||||||
|
Options, Warrants |
Options, Warrants |
Compensation |
||||||||||
|
Plan Category
|
and Rights | and Rights | Plans | |||||||||
|
Equity compensation plans approved by security holders
|
||||||||||||
|
2007 Equity
Plan(1)
|
127,754 | NA | 383,303 | |||||||||
|
2007 Manager Equity
Plan(2)
|
435,000 | $ | 17.00 | 282,945 | ||||||||
|
Equity compensation plans not approved by security holders
|
N/A | N/A | N/A | |||||||||
|
Total
|
562,754 | NA | 666,248 | |||||||||
| (1) | Our 2007 Equity Plan was adopted by our sole stockholder prior to our initial public offering on June 22, 2007. The number of shares in Column (a) includes 95,955 restricted stock units, as well as (i) 23,255 performance shares awarded to Mr. Kellman that were deemed to be vested on January 28, 2010 and (ii) 30,000 performance share awards granted to our executive officers. On March 12, 2009, May 7, 2009 and November 4, 2009, our Compensation Committee granted an additional 49,961 RSUs, 30,333 RSUs, and 10,000 RSUs, respectively, to our executive officers and employees of CIT Healthcare and its affiliates pursuant to the 2008 Performance-Based RSU Award Program. In addition, on December 10, 2009, our Compensation Committee granted 30,000 performance shares to our executive officers and employees of CIT Healthcare. | |
| (2) | Our 2007 Manager Equity Plan was adopted by our sole stockholder prior to our initial public offering on June 22, 2007. The number of shares in Column (a) represents shares issuable upon exercise of a warrant that we granted to CIT Healthcare on September 30, 2008. See “Certain Relationships and Related Transactions” below. |
22
Table of Contents
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Policies
and Procedures With Respect to Related Party
Transactions
It is the policy of our Board of Directors that all related
party transactions (generally, transactions involving amounts
exceeding $120,000 in which a related party (directors and
executive officers or their immediate family members, or
stockholders owning 5% of more of our outstanding stock) had or
will have a direct or indirect material interest) shall be
subject to approval or ratification by the Audit Committee in
accordance with the following procedures.
Each party to a potential related party transaction is
responsible for notifying our Chief Compliance Officer and
Secretary of the potential related person transaction in which
such person or any immediate family member of such person may be
directly or indirectly involved as soon as he or she becomes
aware of such transaction. Our Chief Compliance Officer and
Secretary will determine whether the transaction should be
submitted to the Audit Committee for consideration. The Audit
Committee will then review the material facts of the transaction
and either approve or disapprove of the entry into such
transaction.
Transactions
with Related Persons
Management
Agreement
In connection with our initial public offering, we entered into
a management agreement (the “Original Management
Agreement”) with CIT Healthcare, which describes the
services to be provided by CIT Healthcare and its compensation
for those services. On September 30, 2008, we amended (the
“Amendment”) the Original Management Agreement between
ourselves and CIT Healthcare, and on January 15, 2010 we
further amended and restated (the “Management
Agreement”) the Original Management Agreement. In
consideration of the Amendment and for CIT Healthcare’s
continued and future services to us, we granted CIT Healthcare
warrants to purchase 435,000 shares of our common stock at
$17.00 per share under the 2007 Manager Equity Plan prior to the
Stock Split (defined below). See “Transactions with Related
Persons — Warrant” below.
Under the Management Agreement, CIT Healthcare, subject to the
oversight of our Board of Directors, was required to conduct our
business affairs in conformity with the policies and the
investment guidelines that were approved by our Board of
Directors. The terms of the Management Agreement stated that it
would continue in effect, unless earlier terminated, until
December 31, 2011.
The Management Agreement reduced the base management fee to a
monthly amount equal to (i) $125,000 from February 1,
2010 until the earlier of (x) June 30, 2010 and
(y) the date on which four of our six existing investments
had been sold; then from such date (ii) $100,000 until the
earlier of (x) December 31, 2010 and (y) the date
on which five of our six existing investments had been sold;
then from such date (iii) $75,000 until the date of
expiration or earlier termination of the Management Agreement by
either of us or CIT Healthcare; provided, however, that
notwithstanding the foregoing, the base management fee would
remain at $125,000 per month until the later of: (a) ninety
(90) days after the filing by us of a Form 15 with the
SEC; and (b) the date that the we were no longer subject to
the reporting requirements of the Exchange Act.
In addition, pursuant to the terms of the Management Agreement,
we were required to pay CIT Healthcare a buyout payment of
$7.5 million, payable as follows (i) $2.5 million
on the effective date of the Management Agreement;
(ii) $2.5 million upon the earlier of
(a) April 1, 2010 and (b) the effective date of
the termination of the Management Agreement by either of us or
CIT Healthcare; and (iii) $2.5 million upon the
earlier of (a) June 30, 2011 and (b) the
effective date of the termination of the Management Agreement by
either us or CIT Healthcare. The termination fee that was
operative under the Original Management Agreement was replaced
by the buyout payments under the Management Agreement. On
January 29, 2010, April 1, 2010 and November 15,
2010, we paid CIT Healthcare
23
Table of Contents
$2.5 million, $2.5 million and $2.4 million,
respectively, pursuant to the buyout payments under the
Management Agreement.
CIT Healthcare was also eligible for an incentive fee of
$1.5 million if (i) at any time prior to
December 31, 2011, the aggregate cash dividends paid to our
stockholders since the effective date equaled or exceeded $9.25
per share or (ii) as of December 31, 2011, the sum of
(x) the aggregate cash dividends paid to our stockholders
since the effective date of the Management Agreement and
(y) the Company’s cash and cash equivalents on hand
less cash flows and expenses and other obligations of the
Company, including the incentive fee, equaled or exceeded $9.25
per share. If CIT Healthcare would be eligible for the incentive
fee but for the impact of the payment of the $1.5 million
incentive fee, we were required to pay CIT Healthcare a reduced
incentive fee up to the amount that allows the Company to
satisfy such $9.25 per share eligibility requirement. Since the
Tiptree Transaction did not meet either of such requirements,
CIT Healthcare did not receive the incentive fee.
Both parties could terminate the Management Agreement without
cause under certain circumstances, and we could terminate the
Management Agreement with cause.
For the year ended December 31, 2009, we recognized
$2.2 million in management fee expense related to the base
management fee, and CIT Healthcare was not eligible for an
incentive fee.
The Management Agreement terminated on November 16, 2010
pursuant to the CIT Termination Agreement (defined below) and
all termination fees that would have otherwise been due under
the Management Agreement were paid pursuant to the CIT
Termination Agreement.
Mortgage
Purchase Agreement
On September 30, 2008, we entered into a Mortgage Purchase
Agreement (the “MPA”) with CIT Healthcare in order to
secure a potential additional source of liquidity. The MPA
expired on September 30, 2009. Pursuant to the MPA, we had
the right, but not the obligation, to cause CIT Healthcare to
purchase our current senior mortgage assets at their
then-current fair market value, as determined by a third party
appraiser. However, the MPA provided that in no event would CIT
Healthcare be obligated to purchase any mortgage asset if
(a) CIT Healthcare had already purchased mortgage assets
with an aggregate sale price of $125.0 million pursuant to
the MPA or (b) the third-party appraiser determined that
the fair market value of such mortgage asset was greater than
105% of the then outstanding principal balance of such mortgage
asset. We had the right to exercise our rights under the MPA
with respect to any or all of the mortgage assets identified in
the MPA at any time or from time to time until the MPA expired
on September 30, 2009.
Pursuant to the MPA, we sold loans made to four
(4) borrowers with carrying amounts of $24.8 million,
$22.5 million, $2.9 million and $18.7 million for
total proceeds of $65.2 million. The sale of the first loan
closed in November of 2008 and the Company recorded a loss on
the sale of $2.4 million in the consolidated statement of
operations for the year ended December 31, 2008. The second
loan closed in February of 2009 at a loss of $4.5 million,
the third loan closed in August 2009 at its approximate net
carrying value and the fourth loan closed in September 2009 at a
loss of $1.3 million. In consideration of the Management
Agreement, we agreed to terminate the MPA and rescind all
outstanding put notices under the MPA.
Warrant
In consideration of the Amendment and for CIT Healthcare’s
continued and future services to the Company, we granted CIT
Healthcare warrants to purchase 435,000 shares of the
Company’s common stock at $17.00 per share (the
“Warrant”) under the 2007 Manager Equity Plan prior to
the Company’s three-for-two stock split effected in the
form of a dividend on September 20, 2010 (the “Stock
Split”). The Warrant, which was immediately exercisable,
expires on September 30, 2018. On March 16, 2010, CIT
Healthcare entered into a warrant purchase agreement with
Tiptree, pursuant to which CIT Healthcare sold the Warrant to
Tiptree on the closing of the Tiptree Transaction.
24
Table of Contents
Purchase
and Sale Agreement
Michael G. Barnes and Geoffrey N. Kauffman, may be deemed to
have an indirect material interest in the purchase and sale
agreement (the “Purchase and Sale Agreement”),
pursuant to which we issued, and Tiptree purchased 6,185,050
newly issued shares of our common stock for a purchase price of
$9.00 per share prior to the Stock Split. In the Purchase and
Sale Agreement, we agreed to use the proceeds from the issuance
of common stock to Tiptree to fund the tender offer for up to
all of our outstanding common stock at a fixed price of $9.00
per share. Pursuant to the effected tender offer, Tiptree owns
approximately 92% of the issued and outstanding shares of the
Company’s common stock.
CIT
Termination, Cooperation and Confidentiality Agreement
As disclosed in our
Form 8-K
filed with the Securities and Exchange Commission (the
“SEC”) on November 8, 2010, on November 4,
2010, we entered into a Termination, Cooperation and
Confidentiality Agreement (the “CIT Termination
Agreement”) with CIT Healthcare. Pursuant to the CIT
Termination Agreement, the parties agreed to terminate the
Management Agreement effective as of November 16, 2010 (the
“Termination Effective Date”), subject to extension of
the Termination Effective Date under certain circumstances as
set forth in the CIT Termination Agreement. The CIT Termination
Agreement also provides for an 180 day cooperation period
beginning on the Termination Effective Date relating to the
transition of management of the Company from CIT Healthcare to
the officers of the Company, a two year mutual confidentiality
period and a mutual release of all claims related to CIT
Healthcare’s management of us. Under the CIT Termination
Agreement, the parties agreed that in lieu of the payments
otherwise required under the termination provisions of the
Management Agreement, we would pay to CIT Healthcare on the
Termination Effective Date $2,400,000 plus any earned but unpaid
monthly installments of the base management fee due under the
Management Agreement in lieu of remaining termination payments
payable under the Management Agreement.
Services
Agreement with TREIT Management LLC
As disclosed in our
Form 8-K
filed with the SEC on November 8, 2010, on November 4,
2010, we entered into a Services Agreement (the “Services
Agreement”) with TREIT pursuant to which TREIT will provide
certain advisory services related to our business beginning on
the Termination Effective Date. For such services, we will pay
TREIT a monthly base services fee in arrears of one-twelfth of
0.5% of our Equity (as defined in the Services Agreement) and a
quarterly incentive fee of 15% of our AFFO Plus Gain/(Loss) On
Sale (as defined in the Services Agreement) so long as and to
the extent that our AFFO Plus Gain /(Loss) on Sale exceeds an
amount equal to Equity multiplied by the Hurdle Rate (as defined
in the Services Agreement). Twenty percent (20%) of any such
incentive fee shall be paid in shares of our common stock,
unless a greater percentage is requested by TREIT and approved
by an independent committee of directors. The initial term of
the Services Agreement extends until December 31, 2013,
unless terminated earlier in accordance with the terms of the
Services Agreement and will be automatically renewed for one
year periods following such date unless either party elects not
to renew the Services Agreement in accordance with its terms. If
we elect to terminate without cause, or elect not to renew the
Services Agreement, a Termination Fee (as defined in the
Services Agreement) shall be payable by us to TREIT.
We are also responsible for reimbursing CIT Healthcare for its
pro rata portion of certain expenses detailed in the initial
agreement and subsequent amendments, such as rent, utilities,
office furniture, equipment, and overhead, among others,
required for our operations. Transactions with CIT Healthcare
during the nine months ended September 30, 2010 and
September 30, 2009 included:
| • | Our expense recognition of $7.4 million for the nine months ended September 30, 2010 for the buyout payment obligation, of which $2.4 million is recorded as a liability as of September 30, 2010. | |
| • | Our expense recognition of $1.2 million and $1.7 million for the nine months ended September 30, 2010 and September 30, 2009, respectively for the base management fee. |
25
Table of Contents
| • | On February 3, 2009, we closed on the sale of a loan to CIT Healthcare for proceeds of $22.5 million. | |
| • | On August 19, 2009, we closed on the sale of a loan to CIT Healthcare for proceeds of $2.3 million. | |
| • | On September 16, 2009, we closed on the sale of a loan to CIT Healthcare for proceeds of $17.4 million. |
OTHER
MATTERS
Solicitation
of Proxies
We will pay the cost of solicitation of proxies. In addition to
the solicitation of proxies by mail, our directors, officers and
employees may also solicit proxies personally or by telephone
without additional compensation for such activities. We may also
request persons, firms and corporations holding shares in their
names or in the names of their nominees, which are beneficially
owned by others, to send proxy materials to and obtain proxies
from such beneficial owners. We will reimburse such holders for
their reasonable expenses.
Stockholder
Proposals
Proposals for Inclusion in the Proxy
Statement. Under the rules of the SEC, if a
stockholder wants to include a proposal for consideration in our
proxy statement and proxy card at our 2011 annual meeting of
stockholders, the proposal must be received at our executive
offices located at Care Investment Trust Inc., 780 Third
Avenue, 21st Floor, New York, NY 10017, Attn: Steven M.
Sherwyn, Secretary and Chief Compliance Officer no later than
5:00 p.m., Eastern Time, on July 26, 2011.
Proposals to be Offered at an Annual
Meeting. Under our amended and restated bylaws,
and as permitted by the rules of the SEC, certain procedures are
provided which a stockholder must follow to nominate persons for
election as directors or to introduce an item of business at an
annual meeting if such matter is not intended to be considered
for inclusion in the proxy statement. These procedures provide
that nominations for director nominees
and/or an
item of business to be introduced at an annual meeting of
stockholders must be submitted in writing by certified mail to
the Secretary of the Company at our executive offices located at
Care Investment Trust Inc., 780 Third Avenue,
21st Floor, New York, NY 10017, Attn: Steven M. Sherwyn,
Secretary and Chief Compliance Officer. We must receive the
notice of your intention to introduce a nomination or proposed
item of business at our 2011 Annual Meeting no earlier than
150 days prior to the first anniversary of the date of
mailing of the Notice for the 2010 Annual Stockholders Meeting
and no later than 120 days in advance of such date. In
addition, nominations for a non-incumbent director must be
accompanied by information concerning the proposed nominee,
including such information as is required by the Company’s
amended and restated bylaws and the proxy rules under the SEC.
Householding
of Proxy Materials
The SEC has adopted rules that permit companies and
intermediaries (such as banks and brokers) to satisfy the
delivery requirements for proxy statements and annual reports
with respect to two or more stockholders sharing the same
address by delivering a single proxy statement addressed to
those stockholders. This process, which is commonly referred to
as “householding,” potentially means extra convenience
for stockholders and cost savings for companies.
This year, a number of brokers with account holders who are our
stockholders will be “householding” our proxy
materials. A single proxy statement will be delivered to
multiple stockholders sharing an address unless contrary
instructions have been received from the impacted stockholders.
Once you have received notice from your broker that they will be
“householding” communications to your address,
“householding” will continue until you are notified
otherwise or until you revoke your
26
Table of Contents
consent. If, at any time, you no longer wish to participate in
“householding” and would prefer to receive a separate
proxy statement and annual report, please notify us, by
directing your written request to: Care Investment
Trust Inc., 780 Third Avenue, 21st Floor, New York, NY
10017, Attn: Steven M. Sherwyn, Secretary and Chief Compliance
Officer, Phone Number
(212) 446-1407.
Stockholders who currently receive multiple copies of the proxy
statement at their address and would like to request
“householding” of their communications should contact
their broker as specified above.
Other
Matters
Our Board of Directors does not know of any matters other than
those described in this proxy statement that will be presented
for action at the Annual Meeting. If other matters are
presented, proxies will be voted in accordance with the best
judgment of the proxy holders.
By Order of our Board of Directors
Steven M. Sherwyn
Secretary and Chief Compliance Officer
New York, New York
November 22, 2010
27
Table of Contents
| I VOTE BY INTERNET — www.proxyvote.com Use the Internet to transmit your voting instructions and for electronic delivery of information upuntil11:59P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. Electronic Delivery of Future PROXY MATERIALS If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. VOTE BY PHONE -1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we — have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY11717. TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS DETACH AND RETURN THIS PORTION ONLY For Withhold For All To withhold authority to vote for any Election of Directors Nominees Michael Barnes 02 Geoffrey Kauffman 03 Salvatore V. 06 Jonathan Ilany The Board of Directors recommends a vote FOR the following proposal: For Against Abstain To ratify the selection of Deloitte & Touche LLP as our independent auditors for the fiscal year ending December 31, 2010. NOTE: To consider and act upon such other matters that may properly be brought before the annual meeting or at any adjournments or postponements thereof. Please sign this proxy card and return it promptly, whether or not you plan to attend the meeting. If signing for a corporation or partnership or as agent, attorney or fiduciary, indicate the capacity in which you are signing. If you do attend the meeting and decide to vote by ballot, such vote will supersede this proxy. shares cusip # sequence # Signature [PLEASESIGN WITHINBOX] Date Signature(Joint Owners) Date |
Table of Contents
| CARE INVESTMENT TRUST INC. ANNUALMEETING OF STOCKHOLDERS December 20, 2010 10:00 a.m., local time Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement, Form 10-K is/are available at www.proxyvote.com. This proxy card is solicited on behalf of The Board of Directors for the Annual Meeting of Stockholders on December 20, 2010 The undersigned hereby appoints Steven M. Sherwyn and Salvatore (Torey) V. Riso, Jr., and each of them, as proxies, with full power of substitution, to vote all of the undersigned’s shares of Care Investment Trust Inc. Common Stock at the Annual Meeting of Stockholders to be held on Monday, December 20, 2010 at 10:00 a.m. local time at the Care Investment Trust headquarters, 780 Third Avenue, 29th Floor,New York, NY 10017, and any adjournments or postponements thereof, upon all subjects that may properly come before the meeting, including the matters described in the proxy statement furnished herewith, subject to any direction indicated on the reverse side of this card. The shares of Common Stock you beneficially own will be voted as you specify. If no directions are given, the proxies will vote FOR Proposals 1 and 2. The proxies, in their discretion, are futher authorized to vote (i) for the election of a person to the Board of Directors if any nominee named herein becomes unable or unwilling to serve, and (ii) on any other matter that may properly come before the meeting. Continued and to be signed on reverse side |
TABLE OF CONTENTS
QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING iiiWhat is the purpose of the meeting? iiiHow does the Board recommend I vote on these proposals? iiiWho is entitled to vote at the meeting? iiiHow many shares can vote? ivWhat constitutes a quorum? ivHow are broker non-votes and abstentions treated for quorum purposes? ivWhat vote is needed to approve each proposal? ivHow are broker non-votes and abstentions treated for purposes of the proposals? ivCan I change my vote after I submit my proxy card or give instructions over the Internet or telephone? vHow do I vote? vHow is my vote counted? vWhat other information should I review before voting? vWho is soliciting my proxy? viPROPOSAL 1: ELECTION OF DIRECTORSRecommendationInformation Regarding the Nominees for ElectionExecutive Officers and Executive CommitteeThe Board of Directors and its CommitteesAudit CommitteeCompensation, Nominating and Corporate Governance CommitteeDirector CompensationCORPORATE GOVERNANCE MATTERSCorporate Governance GuidelinesDirector Resignation PolicyDirector IndependenceCode of Business ConductCommunications with our Board of DirectorsWhistleblowing and Whistleblower Protection PolicyDirector Attendance at Annual MeetingsIdentification of Director CandidatesExecutive Sessions of Independent DirectorsCurrent Board Leadership StructureBoards Role in Risk OversightCNG Interlocks and Insider ParticipationPROPOSAL 2: RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORSAudit FeesPre-Approval Policies and Procedures of our Audit CommitteeRecommendationAUDIT COMMITTEE REPORTEXECUTIVE COMPENSATIONNote to Readers2009 Compensation Discussion and Analysis