Current Report Filing (8-k)
March 05 2020 - 5:01PM
Edgar (US Regulatory)
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 earliest event reported: February
28, 2020
TSR, Inc.
(Exact Name of Registrant as Specified in
Charter)
Delaware
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00-8656
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13-2635899
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(State or Other Jurisdiction
of Incorporation)
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(Commission File Number)
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(I.R.S. Employer
Identification No.)
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400 Oser Avenue, Suite 150, Hauppauge, NY 11788
(Address of Principal Executive Offices)
(Zip Code)
(631) 231-0333
(Registrant’s telephone number, including
area code)
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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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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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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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:
Title
of Each Class
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Trading
Symbol(s)
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Name
of Each Exchange On Which Registered
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Common
Stock, par value $0.01 per share
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TSRI
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NASDAQ
Capital Market
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Preferred
Share Purchase Rights1
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1Registered pursuant to Section 12(b) of the
Act pursuant to a Form 8-A filed by the registrant on March 15, 2019. Until the Distribution Date (as defined in the registrant’s
Rights Agreement dated August 29, 2018), the Preferred Share Purchase rights will be transferred only with the share of the registrant’s
Common Stock to with the Preferred Share Purchase Rights are attached.
Indicate by check mark whether the registrant is an emerging
growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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Item 1.02
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Termination of a Material Definitive Agreement
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On February 28, 2019, we
provided oral notice, and on February 29, 2019, we provided written notice to our President, Chief Executive Officer and Treasurer,
Mr. Christopher Hughes, that his employment with TSR, Inc. (the “Company”) was terminated for “Cause” as
defined in Section 6(a) of his Amended and Restated Employment Agreement (the “Employment Agreement”), dated August
9, 2018.
The Employment Agreement
provides that Mr. Hughes was to be paid a base salary of $400,000 per annum, an annual discretionary bonus with advance payments
on a quarterly basis based on the amount of the bonus that would have been earned through the end of each quarter according to
standards established by the Company’s Compensation Committee and approved by the Board of Directors, participation in any
employee benefit plan generally available to the Company’s executives, executive medical benefits and a car (leased or owned
at the sole discretion of the Company). Under the Employment Agreement, the Company has the right to immediately terminate Mr.
Hughes’ employment for “Cause”, in which event Mr. Hughes shall be entitled to receive his base salary for the
month in which the termination is effective.
On March 2, 2020, the Company
received a letter from Mr. Hughes, providing notice of his intent to resign for “Good Reason” as defined in Section
7(c) of the Employment Agreement pursuant to which he claims to be entitled to the “Enhanced Severance Amount” under
the Employment Agreement. This amount which would be equal to the sum of (a) his base salary through the date of termination or
resignation plus his bonus pro-rated through such date, (b) an amount equal to two times his base salary plus two times his bonus
for the then-current fiscal year, or if such bonus amount cannot be determined, two times the bonus paid to him in the prior fiscal
year, (c) continued group health insurance benefits (including both group health insurance benefits generally offered to all eligible
employees of the Company and supplemental executive health insurance benefits) until the earlier of the second anniversary of termination
or such time as Mr. Hughes is eligible for comparable coverage under the group health insurance plans of another employer and (d)
reimbursement for the monthly cost of his car lease until the second anniversary of the termination of his employment; provided
that, as a condition to his right to receive the payments and benefits in clauses (b), (c) and (d), Mr. Hughes executes, delivers
and does not revoke a release of all claims against the Company and its affiliates.
A copy of the Employment
Agreement is attached as Exhibit 10.1 to the Current Report on Form 8-K that we filed with the Securities and Exchange Commission
on August 14, 2018, and is incorporated herein by reference. The foregoing description of the Employment Agreement is qualified
in its entirety by reference to the full text of the Employment Agreement.
The Employment Agreement
incorporates the terms and provisions of a Maintenance of Confidence and Non-Compete Agreement between the Company and Mr. Hughes
dated as of August 9, 2018. The Maintenance of Confidence and Non-Compete Agreement sets forth Mr. Hughes’ covenants against
the disclosure of confidential information, covenants against the solicitation of customers, employees and independent contractors
and a covenant against competition (all in accordance with the terms set forth therein) and supercedes any prior agreements entered
into by Mr. Hughes pertaining to such covenants. A copy of the Maintenance of Confidence and Non-Compete Agreement between the
Company is attached as Exhibit 10.2 to the Current Report on Form 8-K that we filed with the Securities and Exchange Commission
on August 14, 2018, and is incorporated herein by reference. The foregoing description is qualified in its entirety by reference
to the full text of the Maintenance of Confidence and Non-Compete Agreement.
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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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(b) On
February 28, 2019, we provided oral notice, and on February 29, 2019, we provided written notice Mr. Christopher Hughes that effective
as of February 29, 2019, he had been terminated from his positions as President, Chief Executive Officer (principal executive
officer) and Treasurer of the Company and as President of TSR Consulting Services, Inc., a wholly-owned subsidiary of the Company.
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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TSR, Inc.
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By:
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/s/ John G. Sharkey
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John G. Sharkey
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Senior Vice President and Chief Financial Officer
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Dated: March 5, 2020
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