SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 13 or 15(d) of
t he Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 1, 2019
SPAR Group, Inc.
Name of Registrant as Specified in Charter)
(State or Other Jurisdiction
Westchester Avenue, South Building, Suite 204, White Plains,
|(Address of Principal Executive
number, including area code: (914) 332-4100
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
||Written communications pursuant to
Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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.
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Name of each exchange on which registered
Item 8.01 Other Events.
Mistake in 2019 Proxy Card.
SPAR Group, Inc. ("SGRP", the "Corporation" or the "Registrant"),
on April 29, 2019, filed its definitive Proxy Statement on Schedule
14A (the "2019 Proxy Statement") with the Securities and Exchange
Commission ("SEC"), and began mailing the 2019 Proxy Statement to
its stockholders and soliciting their proxies for the 2019 annual
meeting of SGRP's stockholders (the "2019 Annual Meeting"). The
2019 Proxy Statement is hereby incorporated herein by
The 2019 Proxy Statement included a Proxy Card (the "2019 Proxy
Card") that contains an unintentional omission: it fails to provide
a check box for a vote "AGAINST" a director.
However, the 2019 Proxy Statement correctly described the votes
"for" and "AGAINST" (or "NO") for a candidate for director:
An affirmative majority of votes cast at the 2019 Annual Meeting in
person or by proxy is required for the election of each nominee to
serve as a director. Accordingly, any Director receiving a majority
of "no" votes is denied reelection and has agreed to immediately
retire (see below). Stockholders are not entitled to cumulate
votes. In a field of more than seven nominees, the seven nominees
receiving the most votes would be elected as directors. Votes
withheld, abstentions and broker non-votes are not counted as votes
"FOR" or "AGAINST" a director nominee and will have no effect on
the outcome of the election.
This result is mandated by SGRP's 2019 Amended and Restated By-Laws
(the "Restated By- Laws) respecting stockholder voting.
The 2019 Proxy Card should have had provision for voting "no" or
"against" a candidate for director. To be elected, a candidate must
receive more "FOR" votes cast than "AGAINST" votes cast, i.e, the
decision is made by a majority of the votes cast. Votes cast do not
include abstentions (including "withheld"), non-votes or
inconclusive votes (i.e., no box clearly checked, multiple boxes
checked, and the like) respecting any candidate or matter.
I nstructions For Voting "AGAINST" a
As described in the 2019 Proxy Statement, the Board recommended a
vote in favor of all candidates. SGRP has worked with its transfer
agent also to correct this error for those voting via the internet,
telephone or mail. Accordingly, you can vote "AGAINST" a
However, you can vote "AGAINST" any candidate for director any of
four different ways:
You can vote over the internet, which will permit you to vote
"AGAINST" any candidate for director.
Go to www.envisionreports.com/SGRP.
Or scan the QR code with your smartphone.
Follow the steps outlined on the secure website.
You can vote by telephone, which will permit you to vote "AGAINST"
any candidate for director.
Call toll free 1-800-652-VOTE (8683) within the USA, US territories
&Canada on a touch tone telephone
Follow the instructions provided by the recorded message
You can vote "AGAINST" any candidate for director on your 2019
Proxy Card IF YOU WRITE "AGAINST" immediately after such director's
name on your 2019 Proxy Card and return it in the envelope included
with the 2019 Proxy Statement. Be careful not to check "for" or
"withheld" if you are voting "AGAINST". More than one choice for
the same director will invalidate your vote.
You can vote "AGAINST" any candidate for director by attending the
2019 Annual Meeting in person on Wednesday, May 15, 2019, at 9:00
AM, Eastern Time, at Tampa Airport Marriott, 4200 George J. Bean
Parkway, Tampa, FL 33607.
Consequences of a Majority Vote "AGAINST" a Director
As described in the 2019 Proxy Statement:
If more votes are cast "against" a candidate for director than
"for" him or her, that candidate will not be elected. As provided
in the Restated By- Laws pursuant to the Settlement, each Director
has signed and delivered to the Corporation a written irrevocable
letter of resignation and retirement (which shall constitute an
irrevocable resignation for purposes of DGCL Section 141(b)),
pursuant to which the departing Director shall be deemed to have
retired for all purposes (including all plans and other benefits,
but excluding indemnification and severance rights) which letter
shall be effective as and when, and effective upon, such person
failing to be re-elected by the required majority affirmative vote
of the voting stockholders at which such person is subject to
re-election. Accordingly, that retirement could be triggered if a
majority of the votes are "no" (or "against"), and the Majority
Stockholders have the power to together vote "no" and effectively
remove any Director.
For a description of the Majority Stockholders, the Restated By-
Laws and the Settlement, Please see Note 9 to the Company's
Consolidated Financial Statements – Commitments and
Contingencies -- Legal Matters - Delaware Litigation
Settlement , in the Corporation's 2018 Annual Report on Form
10-K/A for the year ended December 31, 2018, as filed with the SEC
on April 24, 2019 (the "2018 Annual Report").
The removal of any independent director would result in an
immediate violation of Nasdaq Listing Rule 5605(b)(1), which
requires a majority of the board of directors of a listed company
to be comprised of independent directors as defined in Rule
5605(b)(1) (the "Nasdaq Board Independence Rule"). See Risks of
a Nasdaq Delisting and Penny Stock Trading in Item 1A – Risk
Factors in the 2018 Annual Report.
Any vacancy created by a majority vote "AGAINST" any director must
be filled within 90 days by the Governance Committee and Board or
else the stockholders may act. As part of the Settlement, the
parties agreed in the Restated By- Laws to provisions that (among
other things) preserve the current roles of the Governance
Committee and Board in the location, evaluation, and selection of
candidates for candidates to fill Board vacancies (other than those
under a stockholder written consent making a removal and
appointment, which is unchanged).
A current copy of the Restated By-Laws is posted and available to
stockholders and the public on the Corporation's web site (
www.sparinc.com ). The foregoing descriptions are qualified
in their entirety by reference to the Restated By-Laws, which are
incorporated herein by reference.
Revised Proxy Cards .
The Corporation has revised the forms of its 2019 Proxy Cards (each
a "Revised 2019 Proxy Card ") to permit a vote "AGAINST" any
candidate for director and to correct several typographical
errors. Copies of the Revised 2019 Proxy Cards for
stockholders and for brokers are attached hereto and filed herewith
as Exhibit 99.1 and 99.2, respectively, and are incorporated herein
by reference. The Revised 2019 Proxy Cards also are being
filed with the SEC as Definitive Additional Materials under
However, you should still use one of the four ways listed above to
vote "AGAINST" any candidate for director.
Forward Looking Statements
This Current Report on Form 8-K and the attached Exhibit (this
"Current Report"), contain "forward-looking statements" within the
"safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995, made by, or respecting, SGRP and its
subsidiaries (together with SGRP, the "SPAR Group" or the
"Company"), and this Current Report has been filed by SGRP with the
Securities and Exchange Commission (the "SEC"). There also are
"forward-looking statements" contained in SGRP's Annual Report on
Form 10-K/A for its fiscal year ended December 31, 2018 (as filed,
the "Annual Report"), as filed with the SEC on April 24, 2019, in
SGRP's definitive Proxy Statement respecting its Annual Meeting of
Stockholders to be held on May 15, 2019, as filed with the SEC on
April 29, 2019 ( the "Proxy Statement"), and SGRP's other reports
and statements as and when filed with the SEC (including this
Current Report, the Annual Report and the Proxy Statement, each a
"SEC Report"). "Forward-looking statements" are defined in Section
27A of the Securities Act of 1933, as amended (the "Securities
Act"), and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and other applicable federal and
state securities laws, rules and regulations, as amended (together
with the Securities Act and Exchange Act, the "Securities
All statements (other than those that are purely historical) are
forward-looking statements. Words such as "may," "will," "expect,"
"intend", "believe", "estimate", "anticipate," "continue," "plan,"
"project," or the negative of these terms or other similar
expressions also identify forward-looking statements.
Forward-looking statements made by the Company in this Current
Report or the SEC Reports may include (without limitation)
statements regarding: risks, uncertainties, cautions, circumstances
and other factors ("Risks"); and plans, intentions, expectations,
guidance or other information respecting the potential negative
effects of the forced retirement od a director due to a majority
vote "AGAINST" him or her, the Corporation's non-compliance with
the Nasdaq Board Independence Rule due to the removal of an
independent director, the ability of the Governance Committee and
Board to locate, evaluate and appoint a suitable candidate for an
independent director, or the pursuit or achievement of the
Company's five corporate objectives (growth, customer value,
employee development, greater productivity & efficiency, and
increased earnings per share), building upon the Company's strong
foundation, leveraging compatible global opportunities, growing the
Company's client base and contracts, continuing to strengthen its
balance sheet, growing revenues and improving profitability through
organic growth, new business development and strategic
acquisitions, and continuing to control costs. The Company's
forward-looking statements also include (without limitation) those
made in the Annual Report in "Business", "Risk Factors", "Legal
Proceedings", "Management's Discussion and Analysis of Financial
Condition and Results of Operations", "Directors, Executive
Officers and Corporate Governance", "Executive Compensation",
"Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters", and "Certain Relationships and
Related Transactions, and Director Independence".
You should carefully review and consider the Company's
forward-looking statements (including all risk factors and other
cautions and uncertainties) and other information made, contained
or noted in or incorporated by reference into this Current Report,
the Annual Report, the Proxy Statement and the other applicable SEC
Reports, but you should not place undue reliance on any of them.
The results, actions, levels of activity, performance, achievements
or condition of the Company (including its affiliates, assets,
business, clients, capital, cash flow, credit, expenses, financial
condition, income, liabilities, liquidity, locations, marketing,
operations, performance, prospects, sales, strategies, taxation or
other achievement, results, risks, trends or condition) and other
events and circumstances planned, intended, anticipated, estimated
or otherwise expected by the Company (collectively,
"Expectations"), and our forward-looking statements (including all
Risks) and other information reflect the Company's current views
about future events and circumstances. Although the Company
believes those Expectations and views are reasonable, the results,
actions, levels of activity, performance, achievements or condition
of the Company or other events and circumstances may differ
materially from our Expectations and views, and they cannot be
assured or guaranteed by the Company, since they are subject to
Risks and other assumptions, changes in circumstances and
unpredictable events (many of which are beyond the Company's
control). In addition, new Risks arise from time to time, and it is
impossible for the Company to predict these matters or how they may
arise or affect the Company. Accordingly, the Company cannot assure
you that its Expectations will be achieved in whole or in part,
that it has identified all potential Risks, or that it can
successfully avoid or mitigate such Risks in whole or in part, any
of which could be significant and materially adverse to the Company
and the value of your investment in the Company's Common Stock.
These forward-looking statements reflect the Company's
Expectations, views, Risks and assumptions only as of the date of
this Current Report, and the Company does not intend, assume any
obligation, or promise to publicly update or revise any
forward-looking statements (including any Risks or Expectations) or
other information (in whole or in part), whether as a result of new
information, new or worsening Risks or uncertainties, changed
circumstances, future events, recognition, or
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.
Date: May 3, 2019
James R. Segreto
Segreto, Chief Financial Officer
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