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 30, 2018
Blonder
Tongue Laboratories, Inc.
(Exact
Name of registrant as specified in its charter)
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Delaware
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1-14120
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52-1611421
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(State
or other jurisdiction
of incorporation)
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(Commission
File Number)
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(I.R.S.
Employer
Identification No.)
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One
Jake Brown Road, Old Bridge, New Jersey
08857
(Address
of principal executive offices) (Zip Code)
Registrant’s
telephone number, including area code:
(732) 679-4000
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:
☐ Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
☐
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange
Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth
company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any
new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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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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On
October 30, 2018, Blonder Tongue Laboratories, Inc. (the “Company”) issued a press release announcing the appointment
of Edward R. “Ted” Grauch as the Company’s Executive Vice President and Chief Operating Officer.
In
connection with his employment, Mr. Grauch will receive a base salary of $300,000 per year, and will be eligible to participate
in the Company’s Executive Officer Salary Bonus Plan, subject to the terms of such plan, as determined by the Compensation
Committee of the Board of Directors. He will also receive a signing bonus of $20,000, payable ninety days after his start date
with the Company, and will be entitled to receive reimbursement of up to $8,500 per calendar year for personal air travel to and
from his primary residence outside of New Jersey and a monthly automobile allowance of $750.00. In addition, Mr. Grauch will be
granted (i) incentive stock options to acquire up to 150,000 shares of the Company’s common stock, with options covering
30,000 shares vesting on each of the first two anniversaries of the effective date of his employment, and options covering 45,000
shares vesting on each of the third and fourth anniversaries of the effective date of his employment and (ii) non-qualified stock
options to acquire up to 350,000 shares of the Company’s common stock, with options covering 70,000 shares vesting on each
of the first two anniversaries of the effective date of his employment, and options covering 105,000 shares vesting on each of
the third and fourth anniversaries of the effective date of his employment. The non-qualified options granted are subject to accelerated
vesting in the event of a change in control of the Company. Mr. Grauch also will be eligible to participate in other Company benefit
plans and programs generally available to Company officers and/or employees.
There
are no arrangements or understandings between Mr. Grauch and any other persons, pursuant to which he was appointed as an officer
of the Company, no family relationships among any of the directors or executive officers of the Company, and he has no direct
or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.
The
foregoing summary of the Letter Agreement is qualified in its entirety by reference to the complete text of the Letter Agreement,
which is filed as Exhibits 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
A
copy of the press release announcing Mr. Grauch’s appointment is attached to this Current Report on Form 8-K as Exhibit
99.1 and is incorporated herein by reference.
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Item
9.01
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Financial
Statements and Exhibits
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(d)
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Exhibits.
The following exhibit is filed herewith:
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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.
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BLONDER
TONGUE LABORATORIES, INC.
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By:
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/s/
Eric Skolnik
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Eric
Skolnik
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Senior
Vice President and Chief Financial Officer
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Date:
October 30, 2018
EXHIBIT
INDEX
Exhibit 10.1
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One
Jake Brown Road
Old
Bridge, New Jersey 08857
Tel:
732-679-4000
Fax:
732-679-4353
www.blondertongue.com
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September
12, 2018
Mr.
Edward R. (Ted) Grauch
3208
Hwy 98
Mexico
Beach, FL 32456
Dear
Ted:
On
behalf of Blonder Tongue Laboratories, Inc. (the “Company”), I am pleased to offer you employment with our Company.
We look forward to a successful working relationship providing the highest quality of products and services to our customers.
Your
compensation, benefits, and other initial employment terms are summarized on the enclosed schedule.
On
your first day of employment you should report to Bob Pallé and bring with you evidence of your legal authorization to
work in the U.S. I enclose the Company’s Proprietary Information and Inventions Agreement, which you must sign and return
prior to your first day of work
.
By
signing below, you are accepting employment and agreeing to all the terms of this letter and its enclosures, which supersede any
prior agreements, representations, or discussions regarding your employment. The offer of employment set forth in this letter
will be deemed withdrawn and of no force or effect if a copy of this letter is not countersigned by you and returned to the Company
prior to the close of business on September 26, 2018.
We
look forward to your joining our team.
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Sincerely,
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/s/
Eric Skolnik
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Eric
Skolnik
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SVP
& Chief Financial Officer
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Accepted
and Agreed:
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/s/
Edward R. Grauch
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Dated:
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26
September 2018
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Enc:
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Schedule of Compensation, Benefits, and Other Terms
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Proprietary
Information and Inventions Agreement
SCHEDULE
OF COMPENSATION, BENEFITS, AND OTHER TERMS
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Expected
Start Date:
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October 29, 2018 (“
Start
Date
”)
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Position:
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Executive Vice President/Chief Operating Officer
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Reports
to CEO
Direct
Reports –Engineering, Marketing & Sales
You
will be based in Old Bridge, NJ
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Salary:
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$300,000
per year rate (prorated for balance of 2018) and for 2019, less taxes and withholdings.
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Signing Bonus
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You will be entitled to a signing bonus in the amount
of $20,000, less taxes and withholdings, payable to you ninety days after your Start Date, so long as you remain employed by the
Company through such date.
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Car Allowance
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You will be entitled to receive a car allowance each
month (prorated for any partial month) of your employment, which amount will be included as part of your compensation, in the
amount of $750.00, minus the amount for such month of mileage reimbursement for business travel, at the applicable federal mileage
reimbursement rate due to you, but such reimbursement shall not be in excess of $750.00 in any month.
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Bonus Plan:
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Beginning with calendar year 2019, you will be eligible
to participate in the Executive Officer Salary Bonus Plan, subject to the terms of the Plan, as determined by the Compensation
Committee.
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Equity Award:
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On the Start Date, you will be granted options to acquire
500,000 shares of Common Stock (“
Stock Options
”), with the grant date being the Start Date (“
Grant
Date
”). The exercise price of your Stock Options will be set on the Grant Date, based on the arithmetic mean of the
high and low selling price of the Company’s common stock on the Grant Date, as reported by the NYSE American Exchange (“
Exercise
Price
”).
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Your
Stock Options will vest at the rate of 100,000 shares per year on each of the first two one-year anniversaries of the Grant Date
and 150,000 shares per year on each of the third and fourth one-year anniversaries of the Grant Date, such that the first date
on which any of the Stock Options will vest and be exercisable shall be on the first anniversary of the Grant Date, all as will
be more fully set forth in Option Agreements that will be entered into with you as of the Grant Date.
A
portion of your Stock Options will be Incentive Stock Options, as defined in Section 422 of the Internal Revenue Code of 1986,
as amended (“
ISOs
”), under and pursuant to the Company’s 2016 Employee Equity Incentive Plan (“
2016
Plan
”), subject to the following limitations: (i) first, Stock Options for no more than 250,000 shares of Common Stock
may be granted to any individual in a single calendar year under the 2016 Plan, in accordance with the terms thereof, and (ii)
second, under applicable federal tax law, the maximum number of Stock Options that can be ISOs granted under the 2016 Plan must
be determined separately for each vesting year, and will be limited to the amount derived by dividing $100,000 by the Exercise
Price per share, rounded down to the next whole number of shares. Subject to the foregoing limitations, it is agreed that on the
first and second anniversaries of your Grant Date, you will receive ISOs to acquire 30,000 shares and on the third and fourth
anniversaries of your Grant Date you will receive ISOs to acquire 45,000 shares.
The
balance of the Stock Options (70,000 on the first and second anniversaries of your Grant Date and 105,000 on the third and fourth
anniversaries of your Grant Date) will be granted to you as an inducement award in accordance with the requirements for such awards
set forth in the New York Stock Exchange Listed Company Manual, and not pursuant to the 2016 Plan or any other shareholder-approved
plan maintained by the Company; as such those Stock Options (sometimes referred to herein as “
Inducement Options
”)
will not be ISOs. Vesting of your Inducement Options will be accelerated upon a change in control of the Company. For this purpose,
“change in control of the Company” shall mean a change in control of such nature that it would be required to be reported
to the Securities and Exchange Commission pursuant to Schedule 14A of Regulation 14A or any successor provision (whether or not
the Company is then subject to such reporting requirements). A change of control will be deemed to have occurred if any person,
other than persons or entities who on the date hereof are the “beneficial owners” (as determined pursuant to Sections
13(d) and 14(d) of the Securities Exchange Act of 1934), directly or indirectly, of securities of the Company representing 10%
or more of the combined voting power of the Company’s then outstanding securities, is or becomes the “beneficial owner”
of 25% or more of the combined voting power of the outstanding securities of the Company or if during two consecutive year periods,
the directors at the beginning of such periods cease for any reason during the two-year period to constitute a majority of the
Board of Directors of the Company.
All
of the terms and conditions of your Stock Options will be set forth in Option Agreements that will be entered into with you as
of the Grant Date, (a) in the case of ISOs, consistent with the provisions of the 2016 Plan, and (b) in the case of Inducement
Options, consistent with prior similar grants by the Company to other executive employees, and in all cases, as otherwise approved
by the Compensation Committee.
The
shares underlying the Stock Options shall be subject to restrictions pursuant to Rule 144 under the Securities Act of 1933 as
well as all other applicable securities laws as a result of your anticipated status as an executive officer of the Company and
as a person subject to Section 16 of the Securities Exchange Act of 1934.
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Travel Expenses:
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You
will receive reimbursement of up to $8,500 per calendar year (pro rated for 2018) less
taxes and withholdings, for personal air travel on weekends to and from you primary residence
(in either Atlanta or Mexico Beach, FL). Receipts should be provided to Eric Skolnik.
The personal air travel expense reimbursement will be treated as W-2 wages to you and
taxes and other withholdings will be deducted on that basis, all in compliance with applicable
law.
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Paid Time Off:
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You will be eligible for (i) seven (7) vacation days
during the remainder of calendar year 2018 and (ii) fifteen (15) vacation days per calendar year for each calendar year thereafter
(or such greater number of days to which you may be entitled under the Company’s then standard employment policies) and
(iii) up to six (6) sick days per year, in addition to Company-paid holidays.
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Benefits:
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Eligibility
to participate in the Company’s sponsored group health insurance coverage (medical,
dental, vision), life insurance, and long-term disability plan commences on or about
the Start Date, but in no event later than the first day of the calendar month following
the Start Date. You will be eligible to participate in the Company’s 401(k) plan
after six months of employment.
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Status:
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Full-time
employee. This position is not eligible for overtime as it is exempt from overtime under
applicable law. You will be employed as an at-will employee, meaning either you or the
Company can end the employment relationship at any time for any reason or no reason.
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Work Location:
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You will be based in the Company’s Old Bridge,
NJ office. However, your position will involve travel time away from the Company’s office from time to time. Any work-related
injuries, even if sustained away from the office, are to be reported to the Company immediately. You must take all necessary and
reasonable steps to safeguard the security of both electronic and paper records from unauthorized disclosure or damage, whether
on-site or at a remote work location, and follow any applicable information technology or security policies relating thereto.
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Company Standards:
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As an employee, you will be expected to adhere to the
Company’s standards of professionalism, loyalty, integrity, honesty, and reliability. Employment is subject to all of the
policies and procedures of the Company, as amended from time to time, including but not limited to the Code of Ethics, the Insider
Trading Policy, and the Employee Handbook, copies of which are available upon request for your review. As an executive officer
of a public company, you will also be subject to compliance with all applicable federal and state securities laws.
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Third Party Agreements:
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You represent that you have provided to the Company
(or the Company’s counsel) copies of any agreements with any current or former employers or other third parties that could
restrict your ability to be employed or that limit the manner in which you may be employed. You further represent that you are
not subject to any agreements with any current or former employers or other third parties that prevent you from accepting employment
with the Company or performing the duties of your position. You agree not to bring to the Company or use in performing your duties
for the Company any current or former employer or third party confidential or proprietary information or trade secrets. You also
agree that you will not conduct yourself in a manner that would be violative of any such agreement with your current or former
employers.
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The
Company has the right to modify the terms referenced herein at any time, consistent with any plan terms and applicable law. You
acknowledge and agree that the Company has not provided you any legal or tax advice and that you have had a reasonable opportunity
to consult with your own legal and tax advisors if you so choose.
Exhibit 99.1
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One
Jake Brown Road, Old Bridge NJ 08857
Phone:
732-679-4000 |
Fax:
732-679-4353
www.blondertongue.com
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www.rldrake.com
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FOR
IMMEDIATE RELEASE:
Blonder
Tongue Appoints Edward R. “Ted” Grauch as Executive Vice President
& Chief Operating Officer
OLD
BRIDGE, NJ / October 30, 2018 /
Blonder Tongue Laboratories, Inc
. (NYSE American:
BDR
) announced that the Company’s
Board of Directors has appointed Edward R. “Ted” Grauch as its Executive Vice President and Chief Operating Officer.
Ted
will report directly to Bob Pallé, the Company’s CEO and President, focusing on developing the Company’s product
strategy, sales, marketing, and technology activities. The heads of each of those departments will report directly to Ted.
Ted,
who holds an MBA from Johns Hopkins University, is also a degreed electrical and computer engineer and has more than 20 years
of experience in executive level management and 30 years working in the video, internet and security services provider industries.
Immediately
prior to joining Blonder Tongue, Ted served as President of Kaon USA, Inc., the US subsidiary of South Korea-based Kaonmedia Co.,
Ltd., the world’s fifth largest Set-Top and Broadband device manufacturer, where his responsibilities included all management,
finance, technology marketing and differentiation, competing within the North American market as a major electronics supplier.
Commenting
on Ted’s appointment, CEO and President, Bob Pallé said “We are extremely pleased that Ted has joined the Blonder
Tongue team. Ted has a career history of effective highly motivated leadership, delivering revenue growth and bottom line results.
He has a true entrepreneurial edge to him that will thrive in our environment, as work together to develop the blueprint for an
aggressive plan to grow our Company and take it to the next level.”
Notable
prior positions include over five years with Comcast Cable, serving as Vice President, Video CPE, Office of the CTO, where Ted’s
team was responsible for Comcast’s nationwide residential video device strategy, including the design, development and deployment
of many of Comcast’s X1 series Set-Top box platforms, ground breaking RF and Voice remote control programs, and national
DTA device deployments. The DTA programs allowed Comcast to convert their network to 100% digital transmission by 2013.
Ted
has also held several other executive positions, including VP, head of global marketing at ST Micro’s Advanced SoC video
microprocessor division in Grenoble, France, Senior Vice President at Nagravision SA in Lausanne, Switzerland, from 2001 to 2009,
and as an entrepreneur co-founder of Livewire, Inc, an engineering consulting firm he and his partners sold to Nagravision in
2001. Early in his career, Ted spent over five years as a senior electrical engineer with Scientific-Atlanta and also four years
on engineering internship rotations at the National Security Agency (NSA) and for a US Defense Department contractor, during which
time he held a US DoD TS Security Clearance.
Regarding
his appointment as Chief Operating Officer, Ted Grauch said “With a rich history of innovation, and its reputation for highly
reliable quality products, Blonder Tongue has a great potential for future growth. I’ve been impressed with our recently
released NeXgen (NXG) flexible video and high-speed data delivery Platform. We have a great technology and engineering team at
Blonder Tongue, along with world-class US based manufacturing and quality control organizations in place. I am very confident
the Company is prepared to capitalize on many future opportunities in the market.”
In
connection with Ted’s appointment as Chief Operating Officer, the Company has granted him (i) Incentive Stock Options under
and pursuant to the Company’s 2016 Employee Equity Incentive Plan, to acquire up to 150,000 shares of the Company’s
common stock, subject to time-based vesting conditions whereby 30,000 shares will vest on each of the next two anniversaries of
the effective date of his employment, and 45,000 shares will vest on each of the third and fourth anniversaries of the effective
date of his employment, provided that he remains an active employee of the Company on each such date; and (ii) an employment inducement
award comprised of non-qualified stock options to acquire up to 350,000 shares of the Company’s common stock, subject to
time-based vesting conditions, whereby 70,000 shares will vest on each of the next two anniversaries of the effective date of
his employment and 105,000 shares will vest on each of the third and fourth anniversaries of the effective date of his employment,
provided that he remains an active employee of the Company on each such date. The inducement award contains certain acceleration
provisions in the event of a change in control. The inducement award of options to acquire shares of the Company’s common
stock was made outside of the Company’s 2016 Employee Equity Incentive Plan and approved by the Compensation Committee of
the Company’s Board of Directors in reliance on the employment inducement exception to shareholder approval provided under
the NYSE American Company Guide, Section 711(a), which requires public announcement of inducement awards.
About
Blonder Tongue
Blonder
Tongue Laboratories, Inc. together with R. L. Drake Holdings, LLC - its wholly owned subsidiary - offer customers more than 130
years of combined engineering and manufacturing excellence with solid histories of delivering reliable, quality products. As a
leader in the field of cable television communications, the Company provides system operators and integrators serving the cable,
broadcast, satellite, IPTV, institutional and professional video markets with comprehensive solutions for the provision of content
contribution, distribution and video delivery to homes and businesses. The Company designs, manufactures, sells and supports an
equipment portfolio of standard and high definition digital video solutions, as well as core analog video and high speed data
solutions for distribution over coax, fiber and IP networks. Additional information on the Company and its products can be found
at
www.blondertongue.com
, and
www.rldrake.com
.
“Safe
Harbor” Statement under the Private Securities Litigation Reform Act of 1995: The information set forth above includes “forward-looking”
statements and accordingly, the cautionary statements contained in Blonder Tongue’s Annual Report and Form 10-K for the
year ended December 31, 2017. (See Item 1: Business, Item 1A: Risk Factors, Item 3: Legal Proceedings and Item 7: Management’s
Discussion and Analysis of Financial Condition and Results of Operations), and other filings with the Securities and Exchange
Commission are incorporated herein by reference. The words “believe”, “expect”, “anticipate”,
“project”, “target”, “intend”, “plan”, “seek”, “estimate”,
“endeavor”, “should”, “could”, “may” and similar expressions are intended to identify
forward-looking statements. In addition, any statements that refer to projections for our future financial performance, our anticipated
growth trends in our business and other characterizations of future events or circumstances are forward-looking statements. Readers
are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only
as of the date hereof. Blonder Tongue undertakes no obligation to publicly revise these forward-looking statements to reflect
events or circumstances that arise after the date hereof. Blonder Tongue’s actual results may differ from the anticipated
results or other expectations expressed in Blonder Tongue’s “forward-looking” statements.
Contacts
Eric
Skolnik
Chief Financial Officer
eskolnik@blondertongue.com
(732) 679-4000
Robert
J. Pallé
Chief
Executive Officer & President
bpalle@blondertongue.com
(732) 679-4000