Potbelly Corporation (NASDAQ:PBPB) Files An 8-K Entry into a Material Definitive AgreementItem 1.01.
On October2, 2017, Potbelly Corporation (the “Company”) entered into a settlement agreement (the “Settlement Agreement”) with Ancora Advisors, LLC, Ancora Catalyst Fund LP, Merlin Partners LP and Frederick DiSanto (collectively, the “Ancora Parties”).
Under the Settlement Agreement, the Company agreed to appoint Joseph Boehm to its Board of Directors until the Company’s 2018 Annual Meeting of Stockholders (the “2018 Annual Meeting”) and to include Mr.Boehm (or his replacement, selected in accordance with the Settlement Agreement) in the Company’s slate of nominees for election at the 2018 Annual Meeting. In accordance with the Settlement Agreement, the Ancora Parties have agreed to cause the resignation of Mr.Boehm from the Company’s Board in the event the Ancora Parties’ ownership of the Company’s outstanding common stock falls below 3%.
The Settlement Agreement is effective until the later of thirty calendar days prior to the last day of the advance notice deadline set forth in the Company’s by-laws for the 2019 Annual Meeting of Stockholders (the “2019 Annual Meeting”) or thirty calendar days following the last day that Mr.Boehm (or any replacement) remains on the Board (the “Standstill Period”). During the Standstill Period, the Ancora Parties have agreed to not, among other things, acquire additional shares of the Company’s common stock if they would then beneficially own more than 9.9% of the Company’s common stock, participate in any solicitation of proxies that is inconsistent with Company’s recommendations or proposals, propose or participate in any change of control of the Company (though the Ancora Parties would be allowed to sell or tender their shares and otherwise receive consideration, to any such transaction and to vote on any transaction in their sole discretion), present any stockholder proposal at a stockholder meeting or institute or participate in any litigation against Company or any of its current or former directors or officers.
The foregoing description of the Settlement Agreement is qualified in its entirety by reference to the full text of the Settlement Agreement, which is attached hereto as Exhibit 10.1 and is incorporated by reference herein.
| Item 1.01. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On October3, 2017, the Company’s Board of Directors increased the size of the Board to eight members and appointed Mr.Joseph Boehm, 31, to its Board of Directors in connection with the Settlement Agreement described above in Item 1.01. Mr.Boehm will serve an initial term until the 2018 Annual Meeting. Mr.Boehm was also appointed to the Company’s Nominating and Corporate Governance Committee and Strategic Review Committee. Mr.Boehm is currently the Director, Alternatives Portfolio Manager of Ancora Advisors LLC.
Since the beginning of the last fiscal year, there have been no related party transactions between the Company and Mr.Boehm that would be reportable under Item 404(a) of Regulation S-K. Mr.Boehm will receive compensation as a non-employee director under the Company’s director compensation plan. The Director Compensation Plan is filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on August11, 2017. Mr.Boehm will be indemnified by the Company to the Company’s Seventh Amended and Restated Certificate of Incorporation and Amended and Restated By-laws for actions associated with being a director. In addition, the Company will enter into an indemnification agreement with Mr.Boehm, which provides for indemnification to the fullest extent permitted under Delaware law. The indemnification agreement is substantially identical to the form of agreement filed as Exhibit 10.17 to the Company’s Form S-1 (File No.333-190893) filed August29, 2013.
On October5, 2017, the Company released a press release announcing the matters addressed above. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.
| Item 1.01. | Financial Statements and Exhibits |
(d) Exhibits.
POTBELLY CORP ExhibitEX-10.1 2 d468411dex101.htm EX-10.1 EX-10.1 Exhibit 10.1 SETTLEMENT AGREEMENT This Settlement Agreement (this “Agreement”) is made by and between Potbelly Corporation (the “Company”),…To view the full exhibit click here
About Potbelly Corporation (NASDAQ:PBPB)
Potbelly Corporation is a neighborhood sandwich concept offering sandwiches, salads and other menu items. The Company owns and operates Potbelly Sandwich Works sandwich shops in the United States. The Company also has domestic and international franchise operations of Potbelly Sandwich Works sandwich shops. The Company has a domestic base of approximately 396 shops in 28 states of the United States and the District of Columbia, consisting of 372 Company-operated shops and 24 franchisee-operated shops. It also has approximately 12 international franchised shops, including 11 shops in the Middle East and one shop in the United Kingdom. The Company’s menu includes items made from ingredients, such as vegetables, hearth-baked bread and white meat chicken. The Company also uses whole muscle turkey, ham and roast beef. Its menu includes toasty warm sandwiches, signature salads, soups, chili, sides and desserts, and in its breakfast locations, breakfast sandwiches and steel cut oatmeal.
