ITEM
5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On
January 1, 2010, the Board of Directors (the “Board”) of MFA Financial, Inc., a
Maryland corporation (the “Company”), approved the recommendations of the
Nominating and Corporate Governance Committee that the size of the Board be
expanded from seven to eight members and that, effective January 4, 2010, Robin
Josephs be elected as a new director to fill the resulting
vacancy. Robin Josephs was elected as a Class II director of the
Board, whose term will expire at the 2012 annual meeting of stockholders at
which time it is expected that she will stand for re-election by the Company’s
stockholders. The Board appointed Ms. Josephs to serve as a member of
the Audit Committee of the Board until the 2010 annual meeting of the
Board.
There are
no arrangements or understandings between Ms. Josephs and any other person
pursuant to which she was elected. There are no transactions
involving the Company and Ms. Josephs that would be required to be reported
pursuant to Item 404(a) of Regulation S-K.
Ms.
Josephs will receive the same compensation for her service as received by all
non-employee directors of the Company. On January 1, 2010, the Board
approved the recommendation of its Compensation Committee to amend certain
aspects of the annual compensation package paid to its non-employee
directors. Effective January 1, 2010, the annual cash compensation paid to
the Company’s non-employee directors will be as follows: (i) the annual retainer
for all non-employee directors will continue to be $60,000 per year; (ii) the
annual chair fee paid to the Chairman of the Audit Committee will continue to be
$12,500 per year; (iii) the annual chair fee paid to the Chairman of each of the
Compensation Committee and the Nominating and Corporate Governance Committee
will continue to be $7,500 per year; and (iv) to the extent the position is
approved and confirmed by the Board and a director is appointed by the Board,
the annual fee paid to the Lead Director (if appointed) will be $7,500 per
year. In addition, the Board approved, pursuant to the Company’s 2004
Equity Compensation Plan, (a) an increase in the annual grant of equity
compensation to each non-employee director from 2,500 restricted shares of
common stock, $0.01 par value per share (the “Common Stock”), of the Company to
7,500 restricted shares of Common Stock and (b) an annual grant of equity
compensation to the Lead Director (if appointed) of 7,500 restricted shares of
Common Stock.
On
December 31, 2009, the Company entered into Amended and Restated Employment
Agreements with Timothy W. Korth, the Company’s General Counsel, Senior Vice
President and Corporate Secretary, and Teresa D. Covello, the Company’s Senior
Vice President, Chief Accounting Officer and Treasurer. Each employment
agreement was amended (i) to extend the term of employment for an additional
two-year period ending on December 31, 2011, (ii) to increase the amount of the
annual base salary payable to the employee to a minimum of, in the case of Mr.
Korth, $334,000 per annum and, in the case of Ms. Covello, $257,000 per annum
and (iii) to make certain amendments to the restrictive covenants set forth in
Paragraph 7 therein. Except as provided above, all other material terms
and provisions of the Amended and Restated Employment Agreements, entered into
by Mr. Korth and Ms. Covello as of December 10, 2008 and expiring on December
31, 2009, will remain the same. The foregoing summary of the Amended and
Restated Employment Agreements is qualified by reference to the Employment
Agreements, which are attached hereto as Exhibits 10.1 and 10.2 and incorporated
herein by reference.
ITEM
5.03 Amendments to Articles of Incorporation or Bylaws; Change in
Fiscal Year.
On
January 1, 2010, the Board elected to be subject to Section 3-804(c) of the
Maryland General Corporation Law. The election became effective on
January 4, 2010 upon the acceptance for record by the State Department of
Assessments and Taxation of Maryland of the Company’s Articles Supplementary
describing the election.
Pursuant
to Section 3-804(c), notwithstanding any contrary provision in the Company’s
charter or Bylaws, each vacancy on the Board (including a vacancy resulting from
an increase in the size of the Board or the death, resignation or removal of a
director) may be filled only by the affirmative vote of a majority of the
remaining directors in office, even if the remaining directors do not constitute
a quorum, and any director elected to fill a vacancy will hold office for the
remainder of the full term of the class of directors in which the vacancy
occurred and until a successor is elected and qualifies. The election
to be subject to Section 3-804(c) of the MGCL will supersede the Company’s
Bylaws, which provide that (i) vacancies for any cause other than an increase in
the number of directors would be filled by a majority of the remaining
directors, even if such majority were less than a quorum, (ii) any vacancy
created by an increase in the number of directors would be filled by a majority
of the entire Board and (iii) any director elected to fill a vacancy would serve
until the next annual meeting of stockholders and until his or her successor is
elected and qualifies.
The
Articles Supplementary are attached hereto as Exhibit 3.1.
ITEM
5.05 Amendments to the Registrant’s Code of Ethics, or Waiver of a
Provision of the Code of Ethics.
On
January 1, 2010, the Board, upon the recommendation of the Nominating and
Corporate Governance Committee, approved amendments to the Company’s Code of
Business Conduct and Ethics (the “Code of Ethics”), which applies to all
directors, officers and employees of the Company. The following is a
summary of the substantive amendments to the Code of Ethics:
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the
Personal Financial and Outside Business Interests section was amended to
clarify that the Company’s personnel (a) may not have outside business
interests that are detrimental or potentially detrimental to the best
interests of the Company and (b) may not have a significant financial
interest in, or any business relationship with, a person that does
business with the Company or is a competitor of the Company, except as
approved in accordance with the Company’s Related Party Transaction
Policies and Procedures;
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the
Corporate Boards section was amended to provide that directors that are
invited to serve on the board of directors of another organization should
notify the Nominating and Corporate Governance Committee and the Chairman
of the Board;
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the
Corporate Opportunities section was revised to conform with Maryland
law;
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the
Waivers section was amended to reference the New York Stock Exchange
listing standards; and
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various
other changes to update information or improve the readability and clarity
of the Code of Ethics.
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The
foregoing summary of the amendments to the Code of Ethics is subject to and
qualified in its entirety by reference to the full text of the Code of Ethics,
as so amended, a copy of which is attached hereto as Exhibit 14.1 and is
incorporated by reference into this Item 5.05. The amended Code of
Ethics will be posted as soon as practicable in the Corporate Governance section
of the Company’s website at www.mfa-reit.com.
ITEM
9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits.
The following exhibits are filed
herewith:
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DESCRIPTION
OF EXHIBITS |
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Articles
Supplementary, dated January 1,
2010.
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Amended
and Restated Employment Agreement, dated as of December 31, 2009, by and
between MFA Financial, Inc. and Timothy W.
Korth.
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Amended
and Restated Employment Agreement, dated as of December 31, 2009, by and
between MFA Financial, Inc. and Teresa D.
Covello.
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Code
of Business Conduct and Ethics, dated as of January 1,
2010.
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