SPAR Group, Inc. (NASDAQ:SGRP) Files An 8-K Other Events
Item 8.01 Other Events
Postponement of previously scheduled January 16, 2020, special meeting of SGRP\’s stockholders
SGRP had previously scheduled January 16, 2020, for a special meeting of SGRP\’s stockholders (the \”2020 Special Meeting\”) due to the receipt of written stockholder requests. See SGRP\’s preliminary Proxy Statement on Schedule 14A respecting the 2020 Special Meeting as filed with the SEC on December 11, 2019 (the \”Preliminary Proxy Statement\”), which is hereby incorporated herein by reference.
The 2020 Special Meeting was called at the request of the Brown Group (as defined in the Preliminary Proxy Statement). At the 2020 Special Meeting, the Brown Group requested to have SGRP\’s stockholders: (1) consider and vote on the stockholder proposal to remove Arthur B. Drogue (currently one of four independent directors of SGRP and Chairman of the Board) from the Board, without cause, effective immediately (See Proposal 1 in the Preliminary Proxy Statement); (2) consider and vote on the stockholder proposal to remove R. Eric McCarthey (currently one of four independent directors of SGRP and Chairman of the Audit Committee of the Board), from the Board, without cause, effective immediately (See Proposal 2 in the Preliminary Proxy Statement); (3) consider and approve the stockholder proposed Amendment No. 1 to SGRP\’s current By-Laws to reduce the previously agreed-upon period of time during which the Board may exclusively fill any vacancies on the Board from 90 days to 30 days (See Proposal 3 in the Preliminary Proxy Statement); and (4) consider and approve the stockholder proposed Amendment No. 2 to SGRP\’s current By-Laws that would require the Board to have a majority of \”Independent Directors\” as newly and narrowly defined in the proposed amendment (See Proposal 4 in the Preliminary Proxy Statement).
The Board also asking the stockholders at the 2020 Special Meeting to: (5) consider and grant authority to the Board to increase the size of the Board (which may need to be greater than nine) without further stockholder action if the Board deems it reasonably necessary for majority board independence (See Proposal 5 in the Preliminary Proxy Statement); and (6) consider, ratify and approve the adoption by the Board of the 2019 Plan Amendment to SGRP\’s 2018 Stock Compensation Plan (See Proposal 6 in the Preliminary Proxy Statement).
SGRP has postponed the date for the 2020 Special Meeting due to its receipt of additional special meeting written requests (the \”Brown Group Third Special Meeting Request\”) from Mr. Robert G. Brown (\”Mr. Robert Brown\”), who retired as the Chairman and an officer and director of SGRP on May 3, 2018, and SP/R, Inc. Defined Benefit Pension Trust, which is a trust for the benefit (in part) of Mr. Brown and controlled by Mr. Brown\’s children as its trustees (the \”SP/R Trust\”), and International Global Technologies, LLC (\”InternationalGT\”, and, together with Mr. Robert Brown and the SP/R Trust, the \”December Brown Group\”). SGRP has not determined a new meeting date for the postponed 2020 Special Meeting.
In the Brown Group Third Special Meeting Request, the signers requested that the agenda for the 2020 Special Meeting be changed to include the election of James R. Brown Sr. to the Board, who is the brother of Mr. Robert Brown and father of current Board director Peter W. Brown. SGRP has requested information from James R. Brown Sr. so that the Governance Committee can review and properly evaluate him under SGRP\’s policies and applicable law and SGRP can accurately describe him in an updated Preliminary Proxy Statement.
The 2020 Special Meeting had to be postponed to accommodate (if applicable) such a material agenda change and the required corresponding changes in the Preliminary Proxy Statement.
Since the dates of the earlier written requests, Mr. Robert Brown has sold and transferred a number of SGRP shares. SGRP is endeavoring to confirm that International GT is a SGRP stockholder and that the December Brown Group owns at least 5,273440 (25%) of the currently outstanding SGRP shares required to request a special stockholders meeting.
Once SGRP confirms such ownership and receives the requisite information and evaluations on the newly proposed director candidate, SGRP will file with the SEC an updated Preliminary Proxy Statement specifying a new date for the proposed 2020 Special Meeting.
Forward Looking Statements
This Current Report on Form 8-K and the attached Exhibits (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 SEC. \”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 Laws\”).
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 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 Company\’s failure to comply with Nasdaq\’s Board Independence Rule, the new Board director unilaterally proposed by the December Brown Group, the proposed 2020 Special Meeting, the Company\’s failure to comply withNasdaq\’s continued listing requirements in the future as a result of any proposals approved at the Special Meeting, any further loss of Board independence or other change in Board or committee composition, any related party payments or settlements that may be authorized by a reconstituted Board, any other settlement with the Majority Stockholders or their companies, 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.
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, 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 SGRP\’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 otherwise.
Item 9.01. Financial Statements and Exhibits.
99.1 Text of the letter to SPAR Group, Inc. (\”SGRP\”), from the Nasdaq Stock Market LLC (\”Nasdaq\”) dated December 31, 2019, stating that SGRP was no longer in compliances with Nasdaq\’s Board Independence Rule (as attached hereto and filed herewith).
SPAR GROUP INC Exhibit
EX-99.1 2 ex_168830.htm EXHIBIT 99.1 ex_168830.htm Exhibit 99.1 Text of the letter to SPAR Group,…
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About SPAR Group, Inc. (NASDAQ:SGRP)
Spar Group, Inc. is an international merchandising and marketing services company. The Company provides its merchandising and other marketing services to manufacturers, distributors and retailers across the world, primarily in mass merchandisers, office supply, grocery, drug store, independent, convenience, toy, home improvement and electronics stores. It operates through two segments: the Domestic Division and the International Division. The Domestic Division provides merchandising and marketing services, furniture and other product assembly services, audit services, and technology services to manufacturers, distributors and retailers in the United States. Those services are primarily performed in mass merchandisers, office supply, grocery, drug store, dollar and electronics stores. The International Division provides merchandising, marketing services and in-store event staffing through subsidiaries in Japan, Canada, South Africa, India, China, Australia, Mexico and Turkey.