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 Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): August 24, 2005
R&G Financial Corporation
(Exact name of registrant as specified in its charter)
Puerto Rico
(State or other jurisdiction of incorporation)
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001-31381
(Commission File Number)
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66-0532217
(I.R.S. Employer Identification No.) |
280 Jesús T. Piñero Ave.
Hato Rey, San Juan, Puerto Rico 00918
(Address of principal executive offices and zip code)
(787) 758-2424
(Registrant’s telephone number, including area code)
Not applicable.
(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 Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
See Item 5.02(c), which is incorporated into this Item 1.01 by reference.
Item 5.02 Departure of Directors or Principal Officers; Election of
Directors; Appointment of Principal Officers.
(b) Effective August 24, 2005, Joseph R. Sandoval who was the Executive Vice President and the
Chief Financial Officer of R&G Financial Corporation (the
“Company”) was removed from such positions
by the Board of Directors of the Company and was placed on an indefinite leave of absence. Mr. Sandoval will continue to receive his salary
and other benefits during this leave of absence.
(c) Effective August 24, 2005, the Board of Directors of the Company appointed Vicente Gregorio as
Senior Vice President and Chief Financial Officer of the Company. Since 2002, Mr. Gregorio has
served as the Chairman of VRC Business Services, Inc., a collection company which he founded. He
also has provided consulting and audit services as a sole CPA practitioner since 2002. He was a
Senior Associate at Spectrum Finance Network, Inc., a consulting firm, between November 2004 and
August 2005. From 1973 to 2002, Mr. Gregorio held various
positions at Arthur Andersen LLP.
Between 1987 and 2002, Mr. Gregorio was Managing Partner of the San Juan office of Arthur Andersen
LLP and also headed that office's Assurance and Business Advisory Group. He was also member of Arthur
Andersen LLP’s Florida/Caribbean Executive Committee from 1990 to 2002. While at Arthur Andersen
LLP, Mr. Gregorio provided audit and related services to a number of financial institutions. None
of the entities identified in this paragraph is affiliated with the Company.
Mr. Gregorio is a former director of Santander Bancorp, a multi-bank holding company, and its
wholly owned subsidiary Banco Santander Puerto Rico and a former director of privately held
Caribbean Petroleum Corp. and Affiliates, a gasoline distributor. He is a director of privately
held Packers Provision Co. of Puerto Rico, Inc., a meat distribution company. Mr. Gregorio is a
Certified Public Accountant, and he received a Bachelor of Business Administration with honors from
the University of Puerto Rico. He is a member of the Puerto Rico Society of Certified Public
Accountants and the American Institute of Certified Public Accountants. Mr. Gregorio is 53 years
old.
Under the terms of a letter agreement relating to his employment as Senior Vice President and
Chief Financial Officer of the Company, Mr. Gregorio will receive an initial base salary of
$375,000 and a bonus of $425,000, which will be prorated for 2005. Upon completion of the
restatement process referenced in Item 8.01 hereof, Mr. Gregorio will also be granted 30,000 stock
options to purchase the Company’s common stock, pursuant to the R&G Financial Corporation 2004
Stock Option Plan. He will also be eligible to participate in the Company’s Profit Sharing Plan
after he has been employed for six months and will receive standard health and other benefits offered to employees of comparable position.
A
copy of the letter agreement is being filed herewith as Exhibit 10.1 and
is incorporated into this Item 5.02(c) by reference.
Item 8.01 Other Events.
On August 17, 2005, the Company announced that it received a Notification of Additional
Delinquency with respect to the Company’s four classes of outstanding preferred securities from The
Nasdaq Stock Market which indicated that the Company’s failure to timely file its Quarterly Report
on Form 10-Q for the period ended June 30, 2005 (the “Second Quarter 10-Q”) was a further violation
of Nasdaq Marketplace Rule 4310(c)(14). Due to the work associated with its ongoing efforts to restate
its audited consolidated financial statements for the years ended December 31, 2004, 2003 and 2002
and the related interim periods, the Company disclosed its inability to timely file the Second
Quarter 10-Q with the Securities and Exchange Commission in a Form 12b-25 filed on August 10, 2005.
On May 19, 2005, the Company disclosed that it received a notice from the Nasdaq Listing
Qualifications Department indicating that because of the Company’s failure to file its Form 10-Q
for the period ended March 31, 2005, the Company’s four classes of outstanding preferred securities
would be subject to delisting unless the Company requested a hearing. At the Company’s request, a
hearing was held on June 30, 2005. As a result of such hearing, the Company was advised by the
Nasdaq Listing Qualifications Panel that its four classes of outstanding preferred securities would
continue to be listed on The Nasdaq National Market, subject to certain conditions, including
the filing of all delinquent Quarterly Reports on Form 10-Q on or before September 30, 2005. The
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