Attached files
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| EX-2.1 - EDELMAN FINANCIAL GROUP INC. | v204072_ex2-1.htm |
| EX-99.1 - EDELMAN FINANCIAL GROUP INC. | v204072_ex99-1.htm |
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of
the
Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported)
November 29, 2010
(November 26, 2010)
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Sanders
Morris Harris Group Inc.
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(Exact
name of registrant as specified in its charter)
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Texas
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(State
or other jurisdiction of incorporation)
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0-30066
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76-0583569
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(Commission
File Number)
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(IRS
Employer Identification No.)
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600
Travis, Suite 5800, Houston, Texas 77002
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(Address
of principal executive offices) (Zip Code)
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Registrant’s
telephone number, including area code (713)
993-4610
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(Former
name or former address, if changed since last
report)
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Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2 below):
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14-d—2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.14d-4(c))
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Item
1.01. Entry into a Material Definitive Agreement.
On
November 26, 2010, Sanders Morris Harris Group Inc. (the “Company” or “SMHG”)
announced that it had entered into an agreement to acquire a 48.7% capital
interest and 50.1% profits interest in Global Financial Services, LLC and a
50.1% capital and profits interest in GFS Advisors, LLC, wealth management firms
( “GFS”), based in Houston, Texas. A copy of the press release
announcing the transaction is attached as Exhibit 99.1 to this
Form 8-K and is incorporated herein by reference.
The
Company will acquire its interest in GFS under a Purchase Agreement dated as of
November 26, 2010 (the “Purchase Agreement”), among the Company and the current
owners of GFS, Robert C.A. Benjamin, Gerardo A. Chapa and Ricardo Perusquia
. A copy of the Purchase Agreement is attached to this report as
Exhibit 2.1 and is incorporated herein by reference. The description
of the Purchase Agreement contained in this report is qualified in its entirety
by reference to the full text of the Purchase Agreement.
The
closing of the transaction will occur on December 31, 2010, subject to the
satisfaction or fulfillment of the conditions precedent set forth in the
Purchase Agreement.
Under the
Purchase Agreement the consideration for the purchase will be $18,000,000,
payable $15,000,000 in cash and $3,000,000 in shares of SMHG common
stock. The initial consideration is subject to upward adjustment by a
maximum amount of $4.5 million based on GFS achieving EBITDA in 2011 and/or 2012
in excess of $5.0 million. The full adjustment of $4.5 million will be payable
if GFS’ EBITDA in 2011 and/or 2012 exceeds $5.0 million by $1.4 million and will
be adjusted pro rata for an increase of less than $1.4 million. EBITDA in 2012
must exceed the level achieved in 2011 in order for a payment to be earned for
2012 results. The additional consideration will be paid two-thirds in
cash and one-third in SMHG common stock following the receipt of audited
financial results for 2011 and 2012.
The initial consideration is subject to
further upward adjustment based on the compounded annual growth rate (“CAGR”) of
GFS’ EBITDA achieved in 2012, 2013, and 2014 versus the Base Year EBITDA, if
such CAGR for any year exceeds minimum thresholds. “Base Year EBITDA”
means the greater EBITDA achieved in either 2011 or 2012, but not less than $5.0
million or more than $6.4 million. A CAGR payment for 2012, 2013, or 2014 will
only occur if EBITDA exceeds the Base Year EBITDA by a minimum CAGR of 10%. All
CAGR payments will be made 80% in cash and 20% in Company common stock and will
be paid following the receipt of audited financial results after the close of
each year. The maximum CAGR adjustment in the initial consideration
is approximately $7.7 million if the top tier thresholds are achieved every
year.
2
Item
9.01. Financial Statements and Exhibits.
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c.
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Exhibits
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2.1
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Purchase
Agreement dated as of November 26, 2010, among Sanders Morris Harris Group
Inc., Robert C.A. Benjamin, Gerardo A. Chapa and Ricardo
Perusquia
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99.1
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Press
Release.
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3
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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SANDERS
MORRIS HARRIS GROUP INC.
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By:
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/s/
George L. Ball
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George
L. Ball,
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Chief
Executive Officer
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