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):
ITEM 5.02
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DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS
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Removal of Directors
Effective as of
February 16, 2017, stockholders of the Company holding a majority of the outstanding shares of Common Stock of the Company (the Common Stock) and acting by written consent of stockholders under Section 228 of the Delaware
General Corporation Law (the DGCL), consented to remove Paul E. Flynn, Paul Guzzi, Michael R. Loeb and Wayne Wilson from the Board.
Election of Directors
Effective as of
February 16, 2017, stockholders of the Company holding a majority of the outstanding shares of Common Stock and acting by written consent of stockholders under Section 228 of the DGCL, consented to elect Matthew Carpenter, Frederick
DiSanto, Jeffrey L. Rutherford and Kurtis J. Wolf (the Newly Elected Directors) to the Board. The Newly Elected Directors filled the vacancies created by the removal of Messrs. Flynn, Guzzi, Loeb and Wilson.
The members of Ancora Advisors, LLC (together with its affiliates, Ancora), a principal stockholder of the Company, and each of the Newly Elected
Directors were deemed to be members of a Group for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended. The members of Ancora and the Newly Elected Directors entered into a Joint Filing and Solicitation
Agreement in which, among other things, (a) the parties agreed to the joint filing on behalf of each of them of statements on Schedule 13D with respect to
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the securities of the Company, (b) the parties agreed to form a Group for the purpose of (i) soliciting written consents or proxies in favor of the Proposals (as defined in
Item 5.07 below), (ii) taking such other actions as the parties deem advisable and (iii) taking all other action necessary or advisable to achieve the foregoing, and (c) Ancora agreed to bear all expenses incurred in connection
with the Groups activities, including approved expenses incurred by any of the parties in connection with the solicitation, subject to certain limitations. Other than as noted herein, the Company is not aware of any arrangements or
understandings between members of Ancora and any of the Newly Elected Directors or any other person or persons relating to the election of the Newly Elected Directors.
The Board has not yet determined Board committee assignments for the Newly Elected Directors.
In connection with his election to the Board, each of the Newly Elected Directors received a nonstatutory stock option under the Companys Amended and
Restated 2000 Stock Option Plan, as amended, to purchase 20,000 shares of Common Stock at an exercise price of $6.45 per share, which was the closing price of the Common Stock on Nasdaq on February 16, 2017. Each nonstatutory stock option has a
term of five years and vests in three equal annual installments.
The disclosure in Item 5.07 of this Current Report on Form 8-K is incorporated
herein by reference.
ITEM 5.03
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AMENDMENTS TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL YEAR
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Effective as of
February 16, 2017, stockholders of the Company holding a majority of the outstanding shares of Common Stock and acting by written consent of stockholders under Section 228 of the DGCL, consented to two amendments to the Companys
Amended and Restated By-Laws (the By-Laws).
The stockholders amended Article II, Section 1 of the By-Laws to fix the size of the Board
at eight members (the Board Size Amendment). Prior to the adoption of the Board Size Amendment, a majority of the Board, acting from time to time by resolution, could fix the number of directors constituting the Board.
The stockholders also amended Article II, Section 2 of the By-Laws to provide that any vacancies on the Board resulting from removal of directors by the
stockholders of the Company would be filled exclusively by the stockholders of the Company (the Vacancy Amendment). Prior to the adoption of the Vacancy Amendment, all vacancies on the Board could be filled by the affirmative vote of a
majority of directors then in office, although less than a quorum.
The descriptions of the Board Size Amendment and the Vacancy Amendment are qualified
in their entirety by reference to Exhibit 3.1 to this Current Report on Form 8-K, which is incorporated herein by reference. The disclosure in Item 5.07 of this Current Report on Form 8-K is also incorporated herein by reference.
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ITEM 5.07
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SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
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Effective as of February 16, 2017,
stockholders of the Company holding a majority of the outstanding shares of Common Stock and acting by written consent of stockholders under Section 228 of the DGCL (the Consent), consented to the following five proposals
(collectively, the Proposals) included in Ancoras Definitive Consent Statement on Schedule 14A, as filed with the Securities and Exchange Commission (the SEC) on January 3, 2017:
Proposal 1
Repeal of any provision of the By-Laws in effect at the time this proposal becomes effective, including any amendments thereto, which
were not included in the By-Laws that were in effect on September 26, 2007 and were filed with the SEC on September 28, 2007 (the By-Law Restoration Proposal);
Proposal 2
Removal without cause of four members of the Board: Paul E. Flynn, Paul Guzzi, Michael R. Loeb and Wayne Wilson, including any person
(other than those elected by Ancoras consent solicitation) elected or appointed to the Board to fill any vacancy on the Board or any newly-created directorships on or after December 22, 2016 and prior to the effectiveness of the Proposals
(the Removal Proposal);
Proposal 3
Amendment of Article II, Section 2 of the By-Laws to provide that any vacancies on the
Board resulting from the removal of directors by the stockholders of the Company shall be filled exclusively by the stockholders of the Company (the Vacancy Proposal);
Proposal 4
Amendment of Article II, Section 1 of the By-Laws to fix the size of the Board at eight members (the Board Size
Proposal); and
Proposal 5
Election of Ancoras four nominees: Matthew Carpenter, Frederick DiSanto, Jeffrey L. Rutherford and
Kurtis J. Wolf, to serve as directors of the Company (or, if any such nominee is unable or unwilling to serve as a director of the Company, any other person designated as a nominee by the remaining nominee or nominees) (the Election
Proposal).
On January 9, 2017, the Company filed a Definitive Consent Revocation Statement on Schedule 14A with the SEC in opposition to the
Proposals. The Board set the close of business on January 11, 2017 as the record date for determining stockholders entitled to give their written consent to the Proposals (the Record Date). As of the Record Date, there were
12,880,356 shares of Common Stock outstanding. All five Proposals passed, and the results of the Consent are below:
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Proposal
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Consenting
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Against
Consenting
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Abstaining
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No. 1 By-Law Restoration Proposal
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8,925,658
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27,541
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11,064
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No. 2 Removal Proposal
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Paul E. Flynn
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6,443,426
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2,509,111
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11,726
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Paul Guzzi
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6,453,695
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2,498,842
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11,726
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Michael R. Loeb
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8,919,270
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33,267
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11,726
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Wayne Wilson
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8,912,551
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39,986
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11,726
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No. 3 Vacancy Proposal
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8,923,866
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29,430
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10,967
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No. 4 Board Size Proposal
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8,914,666
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38,630
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10,967
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No. 5 Election Proposal
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Matthew Carpenter
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8,920,318
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33,084
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10,861
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Frederick DiSanto
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8,920,318
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33,084
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10,861
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Jeffrey L. Rutherford
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6,449,325
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2,504,077
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10,861
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Kurtis J. Wolf
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6,449,325
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2,504,077
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10,861
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As a result of the adoption of the Removal Proposal and the Election Proposal, the current members of the Board are Stephen
Bova, Matthew Carpenter, Frederick DiSanto, Nancy Leaming, Jeffrey L. Rutherford, Shirley Singleton, Timothy Whelan and Kurtis J. Wolf.