UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

____________

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

 

Date of Report (Date of earliest event reported): October 15, 2015

 

 

Concurrent Computer Corporation

 

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware 0-13150 04-2735766
(State or Other (Commission (IRS Employer
Jurisdiction File Number) Identification Number)
of Incorporation)    

 

4375 River Green Parkway, Suite 100, Duluth, Georgia 30096
(Address of Principal Executive Offices) (Zip Code)

 

Registrant’s telephone number, including area code:   (678) 258-4000

 

Not applicable

(Former 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 provisions:

 

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

 

  

Item 1.01. Entry into a Material Definitive Agreement

 

On October 5, 2015, the Board of Directors of Concurrent Computer Corporation (the “Board”) received a letter (“Demand Letter”) from a law firm on behalf of a purported shareholder of Concurrent Computer Corporation (the “Company”), alleging that the Board’s grant of 120,000 restricted stock awards (“RSAs”) pursuant to its November 18, 2014 Employment Agreement with its President and Chief Executive Officer, Derek Elder (the “Employment Agreement”), exceeded the limits set forth in the Company’s 2011 Stock Incentive Plan (the “Plan”).

 

In response to the Demand Letter, the Board formed a special committee (the “Special Committee”) to investigate the allegations and take corrective action as necessary. The Company is also making certain supplemental disclosures in advance of its Annual Meeting of Stockholders to ensure that stockholders have all information necessary for an informed vote. See “Supplement to Proxy Statement” below.

 

Summary of the Allegations

 

The Demand Letter alleges that the Board granted RSAs to Derek Elder in excess of the limits imposed by the Plan and that the Proxy Statement filed by the Company on September 17, 2015 (the “2015 Proxy Statement”) did not disclose that the Board exceeded its authority under the Plan.

 

In connection with these allegations, the Demand Letter demands that the Board:

 

  1. Rescind the excess awards granted to Elder, and seek any other appropriate relief on behalf of the Company for damages sustained as a result of the misconduct against members of the Board, management, and any other person or entity (whether within or without the Company) responsible for the Plan violation described herein;
  2. Investigate whether there are additional violations of the Plan with respect to any other officers and directors and/or other years beyond what is described in the Demand Letter, and if so, take appropriate action;
  3. Adopt and implement adequate internal controls and systems at the Company designed to prohibit and prevent a recurrence of the Plan violation described in the Demand Letter and ensure compliance with NASDAQ rules and regulations; and
  4. Issue supplemental and corrective disclosures prior to the 2015 Annual Meeting of Shareholders in a manner that redresses the disclosure deficiencies described in the Demand Letter.

The Company’s Response to the Issues Raised in the Demand Letter

 

On October 15, 2015, the Company entered into an amendment (the “Amendment”) to the Employment Agreement. Pursuant to the terms of the Amendment, the Company and Mr. Elder have agreed to rescind the 120,000 RSAs initially granted under the Plan to Mr. Elder pursuant to the terms of the Employment Agreement. This rescission will be effective as of the date the RSAs were initially granted to Mr. Elder.

 

In connection with the execution of the Amendment, on October 15, 2015, the Company awarded Mr. Elder a cash bonus of $332,400 and granted Mr. Elder 45,000 RSAs under the Plan that will vest in equal installments on over three years on each anniversary of the grant date, provided that Mr. Elder remains employed by the Company on each such date.

 

As part of the Amendment, the Company also committed that, subject to approval both by the Board and by the Compensation Committee of the Board , in January 2016 the Company will grant Mr. Elder 15,000 RSAs under the Plan that will vest in substantially equal installments on over three years on each anniversary of the grant date and 40,000 RSAs under the Plan that will vest on the third anniversary of the grant date, in each case provided that Mr. Elder remains employed by the Company on each such date.

 

The description above is qualified in its entirety by reference to the text of the Amendment, which is included as Exhibit 10.1 hereto and incorporated herein by reference.

 

 

 

 

Formation of the Special Litigation Committee

 

In light of the allegations made in the Demand Letter, on October 8, 2015 the Board formed a Special Litigation Committee with plenary power investigate and take remedial measures to address the claims in the Demand Letter. The Board appointed Larry Enterline and Dilip Singh to the Special Litigation Committee following its determination that both directors are independent with respect to the allegations raised.

 

The Special Litigation Committee shall make and report its findings and determinations to the Board, which findings and determinations shall be final and not subject to review by the Board and in all respects shall be binding upon the Company. The Special Litigation Committee is authorized to retain such financial, business or legal advisors as it deems necessary or appropriate in connection with considering and evaluating the issues contained in the Demand Letter.

 

Supplement to Proxy Statement

 

The information attached hereto as Exhibit 99.1 amends and supplements the 2015 Proxy Statement and should be read in conjunction with the 2015 Proxy Statement.

 

 

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

The information disclosed in response to Item 1.01 above is incorporated herein by reference.

 

Item 8.01. Other Events.

 

In connection with the issues raised in the Demand Letter and described in Item 1.01 above, the Company has begun conducting a review of its internal controls over financial reporting as of the fiscal quarter ended September 30, 2015. The Company expects to conclude that a control deficiency exists in the design and operation of its internal controls over financial reporting, specifically those controls relating to the identification of applicable limitations on equity awards granted under the Stock Incentive Plan. However, the existence of a control deficiency, and an assessment of the severity of any control deficiency determined to exist, remains subject to further internal review by the Company.

 

Item 9.01. Financial Statements and Exhibits .

 

  (d) Exhibits

 

 

Exhibit No. Description

 

10.1 Amendment to Employment Agreement, dated October 15, 2015, by and between Concurrent Computer Corporation and Derek Elder.
   
99.1 Proxy Statement Supplement, dated October 15, 2015.

  

 

 

 

SIGNATURE

 

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 hereunto duly authorized.

 

  CONCURRENT COMPUTER CORPORATION  
  (Registrant)  
       
       
 Dated:  October 15, 2015 By: /s/ Emory O. Berry  
    Emory O. Berry  
    Chief Financial Officer  

  

 

 

EXHIBIT INDEX

 

Exhibit No. Description
   
10.1 Amendment to Employment Agreement, dated October 15, 2015, by and between Concurrent Computer Corporation and Derek Elder.

 

99.1 Proxy Statement Supplement, dated October 15, 2015.

 

 

 

 

Exhibit 10.1

 

AMENDMENT TO

EMPLOYMENT AGREEMENT

 

THIS AMENDMENT TO EMPLOYMENT AGREEMENT (“Amendment”) is made and entered into effective as of the date provided below, by and between Concurrent Computer Corporation (the “Company”) and Derek Elder (“Executive”).

 

WHEREAS, the Company and Executive (“Executive”) previously entered into the Employment Agreement dated November 18, 2014 (“Agreement”); and

 

WHEREAS, pursuant to the Agreement, the Company granted to Executive a total of 120,000 restricted stock awards (“RSAs”), which RSAs are scheduled to vest in two equal installments on the first and second anniversaries of the effective date of the Agreement, provided that Executive remains employed by the Company on each such vesting date; and

 

WHEREAS, the Company and Executive desire to amend the Agreement to rescind all of the RSAs previously granted to Executive, and to reflect the Company’s agreement to grant the Executive additional RSAs and a cash bonus, each as set forth herein.

 

NOW, THEREFORE, in consideration of Executive’s continued employment with the Company, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

 

1. Section 4.3 of the Agreement is hereby deleted in its entirety. Executive agrees, understands and acknowledges that the rescission of the 120,000 RSAs previously granted under the Agreement, as provided in this Amendment, is retroactive to the date of grant provided in the Agreement and shall have no force or effect as of such date.

 

2. In connection with the Executive entering into this Amendment, the Company shall: (i) pay to the Executive a one-time cash bonus in the amount of $332,400, less all applicable tax withholdings, within thirty (30) days following the effective date of this Amendment, and (ii) award to the Executive 45,000 RSAs, subject to the approval of the Compensation Committee of the Board of Directors (the “Committee”) and subject to the terms of the Company’s Amended and Restated 2011 Stock Incentive Plan, which shall vest in three (3) equal installments on the first, second and third anniversaries of the effective date of this Amendment, provided the Employee is employed by the Company on such vesting date. Notwithstanding the foregoing, the RSAs shall become 100% vested in the event Employee’s employment is terminated because of death or Disability. For purposes of this Amendment, “Disability” shall mean the inability to perform the essential functions connected with the Employee's duties hereunder, with or without reasonable accommodation, which inability shall have existed or shall reasonably be expected to exist for a period of 180 days, even though not consecutive, in any 24 month period.

 

3. The Company shall also award to the Executive an aggregate of 55,000 RSAs in January 2016, subject to the approval of the Committee and the Board of Directors and subject to the terms of the Company’s Amended and Restated 2011 Stock Incentive Plan, with (1) 15,000 RSAs to vest in three (3) equal installments on the first, second and third anniversaries of the grant date and (2) 40,000 RSAs to vest on the third anniversary of the grant date, provided in each case that the Executive is employed by the Company on such vesting date. Notwithstanding the foregoing, the RSAs shall become 100% vested in the event the Executive’s employment is terminated because of death or Disability.

 

4. Except as amended herein, the Agreement shall remain in full force and effect.

 

 

 

 

IN WITNESS WHEREOF, the Company and Executive have executed this Amendment this 15th day of October, 2015.

 

 

  CONCURRENT COMPUTER CORPORATION
   
  By:   /s/ Steve Nussrallah
  Name:  Steve Nussrallah
  Title:  Chairman
   
   
   
   
  EXECUTIVE
   
  /s/ Derek Elder
  Derek Elder

 

 

 

 

 

Exhibit 99.1

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

 

 

Filed by the Registrant x

Filed by a Party other than the Registrant ¨

 

Check the appropriate box:

 

¨ Preliminary Proxy Statement

¨ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

¨ Definitive Proxy Statement

x Definitive Additional Materials

¨ Soliciting Material under Rule 14a-12

 

CONCURRENT COMPUTER CORPORATION

(Name of Registrant as Specified in its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than Registrant)

 

Payment of Filing Fee (Check the appropriate box):

 

x No fee required.
   
¨ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
   
  (1) Title of each class of securities to which transaction applies:  
     
  (2) Aggregate number of securities to which transaction applies:  
     
  (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined):  
     
  (4) Proposed maximum aggregate value of transaction:  
     
  (5) Total fee paid:  
     
¨ Fee paid previously with preliminary materials.
   
¨ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
   
  (1) Amount Previously Paid:
     
  (2) Form, Schedule or Registration Statement No.:
     
  (3) Filing Party:
     
  (4) Date Filed:

 

 

 

 

HTTP:||WWW.SEC.GOV|ARCHIVES|EDGAR|DATA|749038|000114036115035250|IMAGE00002.JPG

4375 River Green Parkway, Suite 100

Duluth, Georgia 30096

 

 

 

Supplement to Proxy Statement for the

2015 Annual Meeting of Stockholders

To be held Tuesday, October 27, 2015

 

 

 

This proxy statement supplement, dated October 15, 2015 (this “Supplement”), supplements the definitive proxy statement (which we refer to as the “Proxy Statement”) of the Board of Directors of Concurrent Computer Corporation filed with the Securities and Exchange Commission (the “SEC”) on September 17, 2015 and relating to the 2015 Annual Meeting of Stockholders (the “Annual Meeting”) to be held at our corporate offices, 4375 River Green Parkway, Suite 100, Duluth, Georgia 30096, at 8:30 a.m., ET, on Tuesday, October 27, 2015.

 

Rescission of Restricted Stock Awards Granted to Mr. Elder

 

The purpose of this supplement is to provide additional information with respect to equity awards previously granted to Mr. Derek J. Elder, our President and Chief Executive Officer. On October 15, 2015, we entered into an amendment (the “Amendment”) to our employment agreement dated November 18, 2014 (the “Employment Agreement”) with Mr. Elder. Pursuant to the terms of the Amendment, we and Mr. Elder agreed to rescind the 120,000 restricted stock awards (“RSAs”) initially granted under the Concurrent Computer Corporation 2011 Stock Incentive Plan (the “Stock Incentive Plan”) to Mr. Elder pursuant to the terms of the Employment Agreement. This rescission will be effective as of the date the RSAs were initially granted to Mr. Elder.

 

As a result of the rescission described above, which consisted of all outstanding equity awards held by Mr. Elder as of June 30, 2015, Mr. Elder’s total compensation for fiscal year 2015 as set forth in the Summary Compensation Table set forth on page 21 of the Proxy Statement was $305,842 and Mr. Elder had no outstanding equity awards required to be reported in the Outstanding Equity Awards Table set forth on page 22 of the Proxy Statement or the Restricted Stock Awards Granted Table on page 18 of the Proxy Statement. Further, for purposes of the calculations of page 26 of the Proxy Statement, Mr. Elder would be entitled to receive $697,578 upon a termination as a result of a change in control since the unvested stock awards listed in the calculation have all been rescinded.

 

The rescission also reduces the number of shares beneficially owned by Mr. Elder set forth in the Stock Ownership Table on page 32 of the Proxy Statement as of August 31, 2015 to 70,000, or less than 1.0% of the shares of common stock then outstanding.

 

 

 

 

In connection with the execution of the Amendment, on October 15, 2015, we awarded Mr. Elder a cash bonus of $332,400 and granted Mr. Elder 45,000 RSAs under the Stock Incentive Plan that will vest in equal installments on over three years on each anniversary of the grant date, provided that Mr. Elder remains employed by us on each such date. We also committed that, subject to approval by our Compensation Committee and our Board of Directors, in January 2016 we would grant Mr. Elder 15,000 RSAs under the Stock Incentive Plan that will vest in substantially equal installments on over three years on each anniversary of the grant date and 40,000 RSAs under the Stock Incentive Plan that will vest on the third anniversary of the grant date, in each case provided that Mr. Elder remains employed by us on each such date.

 

As part of the Amendment, we also committed that, subject to approval both by the Compensation Committee of our Board of Directors and by our Board of Directors, in January 2016 we will grant Mr. Elder 15,000 RSAs under the Stock Incentive Plan that will vest in substantially equal installments on over three years on each anniversary of the grant date and 40,000 RSAs under the Stock Incentive Plan that will vest on the third anniversary of the grant date, in each case provided that Mr. Elder remains employed by us on each such date.

 

Additional Information

 

Stockholders who have already submitted proxies for the Annual Meeting may revoke them, or if they wish to change their vote they may do so by (i) voting again over the Internet or via telephone, if available, prior to 11:59 p.m., ET, on October 26, 2015, (ii) signing another proxy with a later date and sending it so that it is received by our Corporate Secretary prior to October 26, 2015, or (iii) attending and voting at the Annual Meeting in person. Proxies which have already been submitted, and which are not subsequently revoked or changed as described above, will be voted at the Annual Meeting as indicated. Detailed information regarding voting procedures can be found in the Proxy Statement.

 

Except as described in this Supplement, the information disclosed in the Proxy Statement continues to apply. To the extent that information in this Supplement differs from information disclosed in the Proxy Statement, the information in this Supplement applies. The Proxy Statement, together with this Supplement, have been filed with the SEC and are also available for viewing at the website maintained for the Annual Meeting at www.proxyvote.com (as well as on the Investors section of our website located at www.ccur.com/about/investors). We will furnish a copy of this Supplement to any stockholder by mail upon request. All requests should be made in writing and directed to our Corporate Secretary at 4375 River Green Parkway, Suite 100, Duluth, Georgia 30096.