Attached files
file | filename |
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EX-10.3 - Heritage Global Inc. | v208804_ex10-3.htm |
EX-10.4 - Heritage Global Inc. | v208804_ex10-4.htm |
EX-10.1 - Heritage Global Inc. | v208804_ex10-1.htm |
EX-10.2 - Heritage Global Inc. | v208804_ex10-2.htm |
EX-99.1 - Heritage Global Inc. | v208804_ex99-1.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE
SECURITIES AND EXCHANGE ACT OF 1934
January
24, 2011 (January 19, 2011)
Date of
report (Date of earliest event reported)
COUNSEL
RB CAPITAL INC.
(Exact
Name of Registrant as Specified in its Charter)
FLORIDA
(State or
Other Jurisdiction of
Incorporation
or Organization)
0-17973
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59-2291344
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(Commission
File No.)
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(I.R.S.
Employer Identification No.)
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1
Toronto Street, Suite 700, P.O. Box 3, Toronto, Ontario, Canada, M5C
2V6
(Address
of Principal Executive Offices)
(416)
866-3000
(Registrants
Telephone Number, Including Area Code)
C2
Global Technologies Inc.
(Former
Name or Former Address, if Changed Since Last Report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
o
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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 14d-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
240.13e-4(c))
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Section
1 – Registrant’s Business and Operations
Item
1.01.
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Entry
into a Material Definitive
Agreement.
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Director
and Officer Indemnification Agreements
Effective
January 19, 2011, Counsel RB Capital Inc., formerly known as C2 Global
Technologies Inc. (the “Company”, “we” or “us”) has entered into Indemnification
Agreements (an “Indemnification Agreement”) with each of Adam Reich and Jonathan
Reich (each an “Indemnitee”) in connection with appointing each as officers of
the Company as described under Item 5.02. The Company intends to
enter into substantially similar agreements with each of its existing officers
and directors. The material terms of each of the Indemnification
Agreements are identical and are summarized below. The
Indemnification Agreements provide to the Indemnitee indemnification rights that
are in addition to those provided under the Company’s articles of incorporation,
bylaws and applicable law. The Indemnification Agreements provide
that the Company will indemnify the Indemnitee from and against all loss and
liability suffered and expenses (including attorneys’ fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by or on behalf
of the Indemnitee and arising out of any of the following: (i) the Indemnitee’s
service as a director, officer, employee or agent of the Company; (ii) while
serving as a director or officer of the Company, the Indemnitee’s service at the
request of the Company as a director, officer, employee or agent of another
corporation, limited liability company, partnership, joint venture, trust,
employee benefit plan or other enterprise; or (iii) any action alleged to have
been taken or omitted in any of the foregoing capacities. Pursuant to
the Indemnification Agreements, the Company is obligated to maintain insurance
policies that provide coverage for any liability asserted against or incurred by
the Indemnitee by reason of the fact that Indemnitee has or has agreed to serve
in any of the foregoing capacities or arising out of Indemnitee’s status as
such. The Indemnification Agreements provide indemnification rights
to the fullest extent permitted by the Company’s articles of incorporation,
bylaws and the Florida Business Corporation Act or other applicable law and
provide procedures for the determination of the Indemnitee’s right to receive
indemnification and the advancement of expenses. The Indemnification
Agreements also provide certain additional rights to the Indemnitee in the event
of a change in control of the Company.
The
foregoing description of the Indemnification Agreements is a general description
only and is qualified in its entirety by reference to each of the
Indemnification Agreements, a form of which is attached hereto as Exhibit 10.1
and incorporated herein by reference.
Section
5 – Corporate Governance and Management
Item
5.02. Departure of
Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers
Jonathan
Reich and Adam Reich have been appointed co-Chief Executive Officers of the
Company effective January 19, 2011 pursuant to employment agreements entered
into between each of them and the Company (the “Employment
Agreements”). The material terms of each of the Employment Agreements
are identical and are summarized below. Jonathan Reich and Adam Reich
are brothers. Jonathan Reich is 47 years old. Adam Reich is 44 years
old.
Prior to
their appointment as co-CEOs, the Reich brothers each served as co-CEOs of the
Company’s subsidiary, Counsel RB Capital LLC (“Counsel RB”). The brothers will
continue as co-CEOs of Counsel RB in addition to serving in their new
capacity. Jonathan and Adam Reich are former practicing bankruptcy
attorneys and have been assisting legal, financial and corporate clients with
their surplus asset management needs for over 20 years. Both have
extensive experience representing debtors and secured and unsecured creditors
with complex asset transactions that arise from bankruptcies, plant closures and
restructuring situations, and over the years have recovered millions of dollars
from asset dispositions on behalf of their clients.
In
connection with the appointment of each of Adam and Jonathan Reich as co-Chief
Executive Officers of the Company as described above, Allan C. Silber has
resigned the position of Chief Executive Officer of the Company effective
January 19, 2011. Mr. Silber continues to serve as the Chairman of
the Company’s Board of Directors and will also assume the position of President
of the Company, effective January 19, 2011. Mr. Silber is 62 years
old. Mr. Silber was elected to the Board of Directors as a Class II
director in September 2001. He was appointed as Chairman of the Board
in November 2001, a position he held until October 2004, and was again appointed
as Chairman of the Board in March 2005. Mr. Silber is the Chairman
and CEO of Counsel Corporation (“Counsel”), which he founded in 1979, the
Chairman of Knight’s Bridge Capital Partners Inc., a wholly-owned subsidiary of
Counsel that is a financial services provider, and, since 2007, the Chairman
and, until December 2010, the CEO of Terra Firma Capital Corporation, a TSX
Venture Exchange listed company of which Counsel owns approximately
21%. Mr. Silber attended McMaster University and received a Bachelor
of Science degree from the University of Toronto.
The
information relating to Mr. Silber disclosed in Items 11 and 13 of the Company’s
10-K for fiscal year 2009 filed with the SEC on March 31, 2010 (the “10-K”) is
hereby incorporated by reference. The Company has made no change in
the compensation arrangements with respect to Mr. Silber in relation to the
change in his office, and there are no related party transactions between the
Company and Mr. Silber other than those disclosed in Item 11 and Item 13 of the
10-K.
Reich
Brothers’ Employment Agreements
The
Employment Agreements provide that each of the Reich brothers (each an
“Executive”) will serve as a co-CEO of the Company, reporting to the Chairman of
the Board and/or the President of the Company.
The
Employment Agreements provide that each Executive will be paid a base salary of
$450,000 per year, which may be increased but not decreased upon annual review
by the Company’s Board of Directors. Each Executive will also be
eligible for a discretionary annual bonus of up to 50% of his base
salary. The Chairman of the Board of Directors will determine the
amount of any bonus based on performance criteria established at the beginning
of each fiscal year. Any bonus will be paid within 90 days from March
1 in the year following the fiscal year in which the services to which the bonus
applies were performed.
Each
Executive will also be entitled to participate in all employee stock option,
pension and welfare benefit plans, programs and practices maintained by the
Company for its employees generally in accordance with the terms of such plans,
programs and practices as in effect from time to time, and in any other
insurance, pension, retirement or welfare benefit plans, programs and practices
which the Company generally provides to its executives from time to
time.
Pursuant
to the Employment Agreements, on the effective date of their employment, each
Executive was granted certain options to purchase common stock of the Company
under the Company’s 2010 Non-Qualified Stock Option Plan, as described
below.
Each
Executive is entitled to 4 weeks of vacation per year of employment and is
entitled to such holidays as are established by the Company’s
policies.
Each of
the Employment Agreements provides for an initial term of five years, and will
continue year to year thereafter unless either party gives notice of
termination. The term will automatically terminate upon the death of
the Executive. The Company may terminate the Executive’s employment
for cause or without cause upon providing a notice of termination or in the
event the Executive becomes disabled. The Executive may terminate his
employment for good reason by providing a notice of termination within 45 days
of the event which he believes provides him with grounds to terminate his
employment for good reason.
For
purposes of the Employment Agreements:
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·
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“Disability”
means a physical or mental infirmity which impairs Executive’s ability to
perform substantially his duties for a total period exceeding six (6)
months during the term of his employment or for a period of four (4)
consecutive months.
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·
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“Cause”
means actions or omissions by Executive: (i) constituting fraud, larceny,
embezzlement, conversion or otherwise involving the misappropriation of
assets of the Company or any other illegal conduct with respect to the
Company which acts are harmful to, either financially, or to the business
reputation of, the Company; (ii) constituting gross negligence or
intentional misconduct; (iii) resulting in a conviction (or a plea of
guilty or no contest) for any felony or any crime of moral turpitude; (iv)
constituting habitual alcohol or substance abuse; (v) constituting a
material breach of the Employment Agreement which, if curable, is not
cured within fifteen (15) days after receipt of written notice thereof;
(vi) constituting a material failure by Executive to perform his duties,
which nonperformance continues after written notice thereof and a fifteen
(15) day chance to cure; (vii) resulting in an unauthorized breach of the
Company’s Code of Conduct; or (viii) constituting a breach of the
fiduciary duty owed by Executive to the Company or any subsidiary or
affiliate of the Company which, if curable, is not cured within fifteen
(15) days after receipt of written notice
thereof.
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·
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“Good
reason” means, during the term of employment and without Executive’s
consent: (i) a material diminution of Executive’s title, reporting
structure, position or responsibilities; (ii) a material reduction in his
base salary; or (iii) any other action or inaction by the Company that
constitutes a material breach of the Employment
Agreement.
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Upon the
termination of the Executive’s employment for death or disability or by the
Company for cause, the Executive’s beneficiary or estate will be entitled to
receive any earned but unpaid portion, if any, of the Executive’s base salary
computed on a pro rata basis through the Executive’s termination date (the
“Accrued Compensation”), plus a pro rata share of the bonus payable in the
fiscal year of termination. Upon termination of the Executive’s
employment by the Company without cause, the Executive will be entitled to the
Accrued Compensation, twelve month’s base salary (payable in a lump sum) (the
“Severance Payments”), and a pro rata share of the bonus payable in the fiscal
year of termination based on the termination date (provided the Executive has
met as of the termination date the performance criteria established with respect
to the bonus for the fiscal year in which the termination date
occurs). Upon termination of the Executive’s employment by the
Executive for good reason, the Executive will be entitled to the Accrued
Compensation and the Severance Payments. As a condition to receiving
any Severance Payments otherwise due under the Employment Agreement, the
Executive must execute and agree to be bound by a release in favor of the
Company relating to the waiver and general release of any and all claims arising
out of or relating to Executive’s employment and termination of
employment.
Each
Employment Agreement provides that the Executive will be subject to customary
confidentiality obligations for the term of his employment and 12 months
thereafter (or longer with respect to any trade secrets of the Company), to
customary non-compete obligations during the term of his employment and for a
period of 12 months thereafter (except for following a termination by the
Company without cause or by the Executive with good reason), to customary
non-solicitation obligations during the term of his employment and for a period
of 24 months thereafter, and to customary non-disparagement obligations during
the term of his employment and thereafter.
The
foregoing is meant to serve as a summary of the Employment Agreements only and
is qualified in its entirety by reference to the actual Employment Agreements, a
copy of each of which is attached hereto. Jonathan Reich’s Employment Agreement
is attached as Exhibit 10.2, and Adam Reich’s Employment Agreement is attached
as Exhibit 10.3.
Recent
Transactions between the Company and the Reich Brothers
On April
2, 2009 the Company, in partnership with Jonathan and Adam Reich, established
Counsel RB. Counsel RB specializes in the acquisition and disposition
of distressed and surplus assets throughout the United States and Canada,
including industrial machinery and equipment, real estate, inventories, accounts
receivable and distressed debt. In addition to purchasing various
types of assets, Counsel RB also arranges traditional asset disposition services
such as on-site and webcast auctions, liquidations and negotiated
sales. At formation, the Company owned 75% of the ownership interests
in Counsel RB, and Jonathan Reich and Adam Reich each indirectly owned 12.5% of
the ownership interests through each of their wholly-owned companies, Forsons,
which is owned by Jonathan Reich, and Kind Chin, which is owned by Adam
Reich.
On
December 10, 2010, as disclosed in an 8-K dated December 14, 2010, the Company
acquired the ownership interests of Counsel RB held by Kind Chin and Forsons in
a transaction valued at approximately $421,460, based on the issuance of
3,242,000 shares of the Company’s common stock to each of Kind Chin and Forsons
that before announcement of the transaction traded at $0.13 per share on the
Over-the-Counter Bulletin Board (“OTCBB”) market. As discussed above,
Kind Chin is wholly owned by Adam Reich, and Forsons is wholly owned by Jonathan
Reich.
2010
Non-Qualified Stock Option Plan
The
Company’s board of directors approved the creation of a 2010 Non-Qualified Stock
Option Plan (the “Plan”) to induce certain key employees of the Company or any
of its subsidiaries who are in a position to contribute materially to the
Company’s prosperity to remain with the Company, to offer such persons
incentives and rewards in recognition of their contributions to the Company’s
progress, and to encourage such persons to continue to promote the best
interests of the Company. The Company has reserved 1,250,000 shares
of common stock of the Company (subject to adjustment under certain
circumstances) for issuance or transfer upon exercise of options to be granted
under the plan. Options may be issued under the Plan to any key
employees or consultants selected by the Company’s Board of Directors (or a
committee appointed by the board). Each option granted under the Plan
will be evidenced by a stock option agreement. Options may not be
granted with an exercise price less than the fair market value of the common
stock of the Company as of the day of the grant. Options granted
pursuant to the plan are subject to limitations on transfer and execution and
may be issued subject to vesting conditions. Options may also be
forfeited in certain circumstances. The foregoing is intended to be a
summary of the Plan only and is qualified in its entirety by reference to the
Plan itself, a copy of which is attached hereto as Exhibit 10.4.
Option
Grants to the Reich Brothers
Pursuant
to the Employment Agreements, on the effective date of their employment,
Jonathan Reich and Adam Reich were each granted on January 19, 2011 (the “Grant
Date”) options to purchase 625,000 shares of common stock of the Company under
the Plan (the “Options”). The Options were issued subject to the
terms of the Plan. The Options were granted with an exercise price of
$1.83 per share. One quarter of the Options vest and become
exercisable each year beginning on the first anniversary of the Grant Date and
will be fully vested on the fourth anniversary of the Grant Date (subject to
certain conditions). The Options will cease to vest upon the
termination of the Option grantee’s employment. The Options will
expire, if not sooner terminated or fully exercised, upon the tenth anniversary
of the Grant Date.
Section
8 – Other Events
Item
8.01 Other
Events
Name
Change
As
disclosed in an 8-K dated December 14, 2010, the Company’s board of directors
and shareholders holding a majority of the outstanding voting stock of the
Company approved a proposal to change the Company’s name from C2 Global
Technologies Inc. to Counsel RB Capital Inc. The name change became
effective January 19, 2011 upon the filing with the Florida Secretary of State
Articles of Amendment to the Company’s Amended and Restated Articles of
Organization.
Press
Release
On
January 20, 2011, the Company issued the press release attached hereto as
Exhibit 99.1 announcing the appointment of Jonathan Reich and Adam Reich as
co-CEO’s of the Company and the effectiveness of the Company’s change in
name.
Section
9 – Financial Statements and Exhibits
Item
9.01.
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Financial
Statements and Exhibits
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(d)
Exhibits
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No.
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Exhibit
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10.1
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Form
of Indemnification Agreement
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10.2
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Employment
Agreement of Jonathan Reich, dated January 19, 2011.
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10.3
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Employment
Agreement of Adam Reich, dated January 19, 2011.
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10.4
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2010
Non-Qualified Stock Option Plan.
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99.1
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Press
Release Dated January 20,
2011.
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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 thereunto
duly authorized.
Counsel
RB Capital Inc.
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Date:
January 24, 2011
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By:
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/s/ Stephen A. Weintraub
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Name:
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Stephen
A. Weintraub
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Title:
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Chief
Financial Officer and
Corporate
Secretary
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