SURNA INC. (OTCMKTS:SRNA) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers, Compensatory
Arrangements of Certain Officers.
A. Resignation of Director
On May 31, 2017, Morgan Paxhia notified the Board of Directors
(the Board) of Surna Inc. (the Company) of his resignation from
the Board effective May 31, 2017. Mr. Paxhias resignation was a
personal decision and was not the result of any disagreement with
the Company on any matters relating to the Companys operations,
policies or practices.
B. Appointment of New Directors
Effective May 31, 2017, the Board appointed J. Taylor Simonton
and Chris Bechtel to fill the positions vacated by the
resignation of Stephen Keen on May 10, 2017 and Morgan Paxhia.
Messrs. Simonton and Bechtel will serve as directors until the
next annual meeting of shareholders and until their respective
successor is duly elected and qualified. In connection with the
appointments of Messrs. Simonton and Bechtel, the Board
determined that Messrs. Simonton and Bechtel are independent
directors as such term is defined in Rule 5605(a)(2) of the
NASDAQ Stock Market (Independent Directors).
The Board has further determined that Mr. Simonton qualifies as
an audit committee financial expert to the provisions of Item
407(d)(5) of Regulation S-K.
There were no arrangements or understandings between Messrs.
Simonton and Bechtel and the Company or any other persons to
which Messrs. Simonton and Bechtel were selected as a director.
1. Biographical and other information for Mr.
Simonton
Mr. Simonton, age 73, spent 35 years at PricewaterhouseCoopers,
LLC (PwC), including 23 years as a partner in the firms Assurance
Services, before retiring in 2001. Mr. Simonton was a partner for
seven years in PwCs National Professional Services Group, which
handles the firms auditing and accounting standards, SEC,
corporate governance, risk management and quality matters. He has
extensive experience with SEC filings, including assistance with
over 100 initial public offerings during his PwC career.
In May 2017, he was appointed an independent director, a member
of the Audit Committee and a member of the Governance Committee
of Master Chemical Corporation (d/b/a Master Fluids Solutions), a
developer and marketer of specialty chemicals. In May 2014, he
was elected an independent director and chair of the Audit
Committee of Advanced Emissions Solutions, Inc. (NASDAQ: ADES),
an environmental technology and specialty chemicals company,
where he currently also serves as a member of the Nominating
Governance Committee and a member of the Compensation Committee.
Since October 2013, Mr. Simonton has served as an independent
director, chair of the Audit Committee and member of the
Nominating and Governance Committee of Escalera Resources, Co., a
natural gas exploration and development company (OTC: ESCR) and a
member of the Compensation Committee since July 2014.
From May 2008 to July 2015, Mr. Simonton served as the lead
independent director and chair of the Audit Committee of
Crossroads Capital, Inc. (f/k/a BDCA Venture, Inc.) (NASDAQ:
XRDC), a closed-end fund regulated as a business development
company under the Investment Company Act of 1940, where he also
served as a member of the Valuation Committee which he chaired
from 2008 to 2011. From October 2008 to January 2014, Mr.
Simonton served as an independent director and chair of the Audit
Committee of Zynex, Inc. (OTC: ZYXI), a company that primarily
engineers, manufactures, markets and sells its own design of
electrotherapy medical devices used for pain management and
rehabilitation. Mr. Simonton served as a director from September
2005 to May 2013 of Red Robin Gourmet Burgers, Inc. (NASDAQ:
RRGB), a casual dining restaurant chain operator serving high
quality gourmet burgers where he was a member of the Audit
Committee, of which he was chair from October 2005 until June
2009, and a member of the Nominating and Governance Committee.
From January 2003 to February 2007, he also served as a director
and the chair of the Audit Committee of Fischer Imaging
Corporation, a public company that designed, manufactured and
marketed medical imaging systems.
Mr. Simonton served for 10 years until 2015 on the Board of
Directors of the Colorado Chapter of the National Association of
Corporate Directors (NACD), where he served over time as its
Treasurer, President, and Chairman. He is a Board Leadership
Fellow, NACDs highest director credential, and was honored as
Colorados 2014 Outstanding Public Company Director by the Denver
Business Journal and NACD-Colorado.
He is admitted as an expert witness in accounting, auditing, and
corporate governance in U.S. District Court, Colorado Division.
Mr. Simonton is a 1966 graduate of the University of Tennessee –
Knoxville with a B.S. in Accounting and is a Certified Public
Accountant, licensed in Colorado.
2. Biographical and other information for Mr.
Bechtel
Mr. Bechtel, age 57, has over 30 years experience, as an
executive, entrepreneur and consultant, managing and advising
businesses from start-ups to divisions of large Fortune 500
companies. Since 2015, Mr. Bechtel has been the principal of
Bechtel Consulting, LLC, which provides consulting services in
mergers and acquisitions, financial and investment analysis,
capital markets, turnarounds and special situations. Mr. Bechtel
became involved in the cannabis industry about three years ago as
a private investor, consultant and advisor.
In September 2014, Mr. Bechtel joined the advisory board of
Supreme Pharmaceuticals, Inc., a Canadian publicly traded company
committed to becoming a leading supplier of affordable medical
cannabis. Through its wholly-owned subsidiary 7ACRES, a federally
licensed producer of medical cannabis to the Access to
Cannabis for Medical Purposes Regulations, Supreme operates
a 342,000 sq. ft. hybrid greenhouse facility. In November 2014,
Mr. Bechtel was appointed as an independent director and the
chairman of Supreme, where he served in such positions until
resigning in April 2016. From October 2014 to April 2016, Mr.
Bechtel also served as a director of ebbu, llc, a privately-held,
Colorado-based company offering a line of branded cannabis
products and a bulk oil extraction service for cannabis
producers.
In 1983, Mr. Bechtel co-founded Omni Laboratories, Inc., a
privately-held company that provides geologic services for oil
and gas companies, where he was initially responsible for all
business development activities, including a number of business
acquisitions. Mr. Bechtel became the sole owner of Omni in 1995,
when he bought out his other partners. From January 1995 to
September 2006, as President, Mr. Bechtel was responsible for
leading the organic growth initiative as well as expanding Omnis
service offerings, eventually employing 175 people with 14
laboratory locations in six countries. In September 2006, Mr.
Bechtel sold Omni to Weatherford International, Inc. (NYSE: WFT),
one of the largest global providers of innovative mechanical
solutions, technology and services for the drilling, completion
and production sectors of the oil and gas industry. In September
2006, Mr. Bechtel was appointed Group Vice President responsible
for managing and growing the former Omni business, which was
renamed Weatherford Laboratories and, in 2011, he was promoted to
lead the worldwide operations of Weatherfords Surface Logging
Systems division. Mr. Bechtel retired from Weatherford in March
2015.
Mr. Bechtel is a 1981 graduate of Michigan State University with
a B.A. degree in Marketing.
C. Establishment of Audit Committee; Appointments to
Audit Committee
On May 31, 2017, the Board established an Audit Committee, which
will be comprised solely of members that are Independent
Directors.
Messrs. Simonton and Bechtel, together with Timothy J. Keating,
the Companys Chairman of the Board and an independent director,
were appointed to serve as members of the Audit Committee. Mr.
Simonton was appointed as the chair of the Audit Committee.
D. Independent Director Compensation Plan
The Board intends to establish a compensation program for its
independent directors, including Messrs. Simonton and Bechtel, at
a later date. The terms of the independent director compensation
program will be disclosed following approval by the Board.
Item 7.01 Regulation FD Disclosure.
The Company issued a press release on May 31, 2017 announcing the
appointment of Messrs. Simonton and Bechtel as independent
directors and Mr. Simontons appointment as the chair of Audit
Committee. A copy of the press release is attached as Exhibit
99.1 and is incorporated herein by this reference.
Item 9.01 Financial Statements and Exhibits.
(a) Not applicable.
(b) Not applicable.
(c) Not applicable.
(d) Exhibits.
| Exhibit No. | Description |
| 99.1 | Press Release dated May 31, 2017 |
About SURNA INC. (OTCMKTS:SRNA)
Surna Inc. develops, designs and distributes cultivation technologies for controlled environment agriculture (CEA). The Company’s segment is designing, manufacturing, and distributing indoor climate control systems, including but not limited to chillers, lights, reflectors, and irrigation systems, for use in conjunction with the state-regulated cannabis and CEA industry. The Company’s technologies include a line of optimized lighting, environmental control, air sanitation and cultivation facilities. The Company offers full mechanical, electrical, and plumbing (MEP) services, including designing and engineering commercial scale thermodynamic systems specific to indoor grow facility conditions. The Company’s products include Surna Chillers, Surna Reflectors, Hybrid Building and Air Sanitation. Its customers include state-regulated cannabis cultivation facilities, as well as traditional indoor agricultural facilities, including organic herb and vegetable producers. SURNA INC. (OTCMKTS:SRNA) Recent Trading Information
SURNA INC. (OTCMKTS:SRNA) closed its last trading session down -0.008 at 0.132 with 793,574 shares trading hands.