Business Context and Reporting Period
This Form 8-K Current Report was filed by Waterstone Financial, Inc. on April 4, 2019, covering events occurring on March 29, 2019. The filing addresses a modification to a prior Separation Agreement with Eric J. Egenhoefer, the former Chief Executive Officer of Waterstone Mortgage Corporation, a wholly owned subsidiary of Waterstone Financial, Inc.
Key Financial Metrics
The filing does not provide standard financial performance metrics such as revenue, profit, cash flow, margins, debt, or liquidity. The only financial figures disclosed relate to specific deferred compensation payments under the modified agreement:
- Deferral of $100,000 payment from March 15, 2019, to September 15, 2019.
- Deferral of $100,000 payment from June 15, 2019, to March 15, 2020.
Material Changes
The primary material change is the execution of a Modification Agreement on March 29, 2019, involving Waterstone Mortgage Corporation, Eric J. Egenhoefer, and Alterra Group, LLC (a/k/a Panorama Mortgage Group, LLC). Key modifications include:
- Incorporation of Alterra Group, LLC as a party to the original Separation Agreement.
- Extension of non-solicitation and non-compete terms until March 15, 2020.
- Restrictions on Alterra hiring additional loan origination employees in specific Wisconsin counties through December 31, 2019.
- Deferral of two $100,000 compensation payments to Mr. Egenhoefer.
Guidance, Outlook, and Risks
The filing contains no forward-looking guidance, management commentary on future operations, or general risk factors. The primary contingency involves the enforcement of the modified Separation Agreement terms, specifically regarding non-solicitation of employees and the timing of deferred payments. The agreement limits the definition of "Covered Employee" to individuals supervised by Mr. Egenhoefer or about whom he obtained special knowledge.
Investor Verification Checklist
- Verify the total deferred compensation liability ($200,000) and its impact on cash flow timing.
- Confirm the scope of non-solicitation restrictions on Alterra Group, LLC in Wisconsin.
- Review the original Separation Agreement (Exhibit 10.1 to the July 24, 2018, 8-K) to understand the baseline terms being modified.
- Monitor compliance with the hiring cap for Alterra Group in Ozaukee, Milwaukee, and Waukesha counties.