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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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(a)
Director
Removal
On
July 8, 2019, the Delaware Court of Chancery issued an order affirming the validity of the prior removal of Ronald Buschur, Si
Ryong Yu and William Anderson from the Board of Directors of Aura Systems, Inc. (“Aura” or the “Company”)
by stockholders of the Company. More than 27.5 million shares (constituting more than 50% of the outstanding shares of the Company’s
common stock entitled to vote in the election of members of Aura’s board of directors) acted by written consent to remove
Mssrs. Buschur, Yu and Anderson in accordance with Sections 228 and 141(k) of the Delaware General Corporations Law (“DGCL”)
and as authorized by Aura’s bylaws.
In
April 2019, Aura stockholders filed an action in the Delaware Court of Chancery pursuant to Section 225 of the DGCL seeking affirmation
of the removal by stockholders of Ronald Buschur, Si Ryong Yu and William Anderson from the Aura Board of Directors and the election
of Ms. Cipora Lavut, Dr. Robert Lempert and Mr. David Mann. Section 228(a) of the DGCL and Section 2.13 of the Company’s
bylaws provide that any action which may be taken at any annual or special meeting of stockholders may be taken without a meeting,
without notice, via written consent of the holders of outstanding stock having not less than the minimum number of votes that
would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and
voted. Section 141(k) of the DGCL and Section 3.12 of the Company’s bylaws provide that any director or the entire board
of directors may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election
of directors. The Company’s Certificate of Incorporation does not restrict stockholders’ rights to act without a meeting
via written consent or otherwise act to remove or appoint directors.
At
the time of their removals, Mr. Buschur served as the Chairman of the Board and as a member of the Nominating Committee while
Mr. Anderson served as Chairman of the Compensation Committee and member of the Nominating Committee. Mr. Yu did not serve on
any committee at the time of his removal.
(c)
Appointment
of New Executive Officers
On
July 1, 2019 the Board of Directors of the Company, appointed Ms. Cipora Lavut to serve as the Company's acting President, Mr.
David Mann to serve as the Company’s acting Chief Financial Officer, and Dr. Robert Lempert to serve as the Company’s
acting Secretary, effective immediately. Mr. Mann and Dr. Lempert succeed the Company’s acting Chief Financial Officer and
Secretary, Melvin Gagerman, as of such date.
Ms. Cipora
Lavut, 63, was one of Aura’s original founding members. From 1987 to 2002 Ms. Lavut served on Aura’s Board and
as a Senior Vice President. During this period, Ms. Lavut was instrumental to Aura receiving large contracts from the Boeing
Company, Litton Industries and the United States Air Force. Ms. Lavut also provided critical investor relations and marketing
support during this time. Ms. Lavut left Aura in 2002. At the request of Aura’s then Board of Directors and management,
in 2006 Ms. Lavut returned to Aura as Vice President in charge of investors relations and corporate communication. In January 2016,
Ms. Lavut left the Company to pursue other business ventures. Ms. Lavut presently provides marketing and business consulting
to a variety of retail and service-oriented businesses. Ms. Lavut holds a degree in marketing from California State University,
Northridge.
Mr. David
Mann, 48, has been Vice President of Marketing for Mann Marketing, a manufacturing and import company, since 1990 and the Vice
President of Sales of that company since 2007. From 2000 until 2007, Mr. Mann also served as Vice President of Operations.
Mr. Mann has extensive experience dealing with all aspects of marketing and sales, as well as suppliers in both North America
and China. Mr. Mann has been an investor in the Aura since 2007 and previously served as a director of the Company from November 28,
2017 (when he was appointed by the then-Board to fill one of the two existing vacancies) until January 11, 2018. Mr. Mann
holds a degree in Business Administration from College St. Laurent, Montreal, Canada.
Dr. Robert
Lempert, 76, graduated from the University of Pennsylvania and conducted his residency at the Albert Einstein Medical Center in
Philadelphia. Dr. Lempert also served as a Captain in the U.S. Army and previously served on the Company’s Board from
November 28, 2017 (when he was appointed by the then-Board to fill one of the two existing vacancies) until January 11,
2018. Dr. Lempert has been a significant investor, shareholder and an active advocate of Aura’s technology for more
than 20 years.
There
is no family relationship between Ms. Lavut, Mr. Mann or Dr. Lempert and any director, executive officer, or any person nominated
or chosen by the Company to become a director or executive officer of the Company. Since the beginning of the Company’s
last fiscal year, there are no related party transactions of the kind described in Item 404(a) of Regulation S-K in which Ms.
Lavut, Mr. Mann or Dr. Lempert had or will have a direct or indirect material interest.
(d)
Director
Appointment
On
July 8, 2019, the Delaware Court of Chancery issued an order affirming the validity of the prior election of Cipora Lavut, David
Mann, and Robert Lempert to Aura’s Board of Directors by the Company’s stockholders. More than 27.5 million shares
(constituting more than 50% of the outstanding shares of the Company’s common stock entitled to vote in the election of
members of Aura’s board of directors) acted by written consent to elect Ms. Lavut, Mr. Mann and Dr. Lempert in accordance
with Sections 228 and 141(k) of the Delaware General Corporations Law (“DGCL”) and as authorized by Aura’s bylaws.
In
April 2019, Aura stockholders filed an action in the Delaware Court of Chancery pursuant to Section 225 of the DGCL seeking affirmation
of the removal by stockholders of Ronald Buschur, Si Ryong Yu and William Anderson from the Aura Board of Directors and the election
of Ms. Lavut, Dr. Lempert and Mr. Mann. Section 228(a) of the DGCL and Section 2.13 of the Company’s bylaws provide that
any action which may be taken at any annual or special meeting of stockholders may be taken without a meeting, without notice,
via written consent of the holders of outstanding stock having not less than the minimum number of votes that would be necessary
to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Section 141(k)
of the DGCL and Section 3.12 of the Company’s bylaws provide that any director or the entire board of directors may be removed,
with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors. The Company’s
Certificate of Incorporation does not restrict stockholders’ rights to act without a meeting via written consent or otherwise
act to remove or appoint directors.
No
arrangement or understanding exists between Ms. Lavut, Mr. Mann or Dr. Lempert and any other person pursuant to which Ms. Lavut
was selected as a director of the Company. Since the beginning of the Company’s last fiscal year through the present, there
have been no transactions with the Company, and there are currently no proposed transactions with the Company, in which the amount
involved exceeds $120,000 and in which Ms. Lavut, Mr. Mann or Dr. Lempert had or will have a direct or indirect material interest
within the meaning of Item 404(a) of Regulation S-K.
The
Board of Directors has determined that Ms. Lavut will serve as Chairman of Aura’s Board of Directors as well as a member
of both the Nominating Committee and the Compensation Committee. Mr. Mann will serve as Chairman of the Compensation Committee
and a member of both the Nominating and Audit Committees. Dr. Lempert will serve as the Chairman of the Nominating Committee and
a member of both the Audit and Compensation Committees.