EPIC » Topics » CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

This excerpt taken from the EPIC DEF 14A filed Apr 27, 2006.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 

 

Except for the compensation agreements and other arrangements that are described under “Change of Control and Severance Agreements” and the transactions described below, there was not during fiscal year 2005 nor is there currently proposed, any transaction or series of similar transactions to which Epicor was or is to be a party in which the amount involved exceeds $60,000 and in which any director, nominee for director, executive officer, five percent stockholder or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest.

 

Other Related Party Transactions

George Klaus, the Company’s Chairman and CEO, is currently engaged to be married to one of the Company’s Executive Vice Presidents. The Executive Vice President to whom Mr. Klaus is engaged is not an “executive officer” of the Company, and she reports directly to the President and Chief Operating Officer of the Company and not directly to Mr. Klaus. In addition, following a thorough board review of the relationship, the Board has determined that, so long as Mr. Klaus remains in this relationship, all employment and compensation matters relating to her will be made by the President and COO, subject to review and approval by the Chair of the Audit Committee or the entire Audit Committee of the Board, rather than Mr. Klaus. She is currently compensated at a level that the Company believes is comparable to other employees in similar positions of responsibility at the Company.

 

 

On February 13, 2003, the Company completed a private placement of 300,000 shares of newly created Series D Preferred Stock resulting in gross proceeds to the Company of $5,730,000. The Company sold the shares, each of which is convertible into 10 shares of the Company’s common stock, to investment funds associated with Trident Capital (“Trident”, collectively, the “Trident Funds”), a venture capital firm in which one of the Company’s former directors, Donald R. Dixon, serves as managing director, pursuant to a Series D Preferred Stock Purchase Agreement dated as of February 11, 2003 between the Company and Trident. Mr. Dixon is a managing director of Trident Capital, Inc., which is the general partner of Trident Capital, L.P., which is the general partner of Trident Capital Partners Fund -I, L.P. and Trident Capital Partners Fund -I, C.V.; Mr. Dixon is also a member of Trident Capital Management -V, LLC, which is the general partner of Trident Capital Fund-V, L.P., Trident Capital Fund-V Principals Fund, L.P., Trident Capital Fund-V Affiliates Fund, L.P., Trident Capital Fund-V Affiliates Fund (Q), L.P. and Trident Capital Parallel Fund-V, C.V.

 

 

The price of the Series D Preferred Stock was determined to be $19.10, reflecting the Company’s common stock closing price of $1.91 on February 10, 2003, the day preceding the purchase agreement.

 

 

Certain of the Trident Funds, acquired a total of 61,735 shares of Series C Preferred Stock; 25,415 shares were acquired on May 30, 1995 at a purchase price of $78.70 per share and 36,320 shares were acquired on March 5, 2003 at a purchase price of $19.10 per share. These shares were convertible at any time at the election of the holder on a 10-for-1 basis into common stock.

 

 

On November 12, 2004, certain of the Trident Funds effected a conversion of 131,842 shares of Series D Preferred Stock (convertible 10-for-1) into 1,318,420 shares of common stock, leaving a balance of 168,158 shares of

 

-23-


Table of Contents
 

Series D Preferred Stock that had not been converted. In addition, on November 12, 2004, certain of the Trident Funds effected a conversion of 61,735 shares of Series C Preferred Stock (convertible 10-for-1) into 617,350 shares of common stock, and no longer own any shares of Series C Preferred Stock. On August 3, 2005, certain of the Trident Funds effected a conversion of the remaining 168,158 shares of Series D Convertible Preferred Stock convertible (10-for 1), into 1,681,580 shares of common stock, and no longer own any shares of Series D Preferred Stock.

 

During 2003, the Company recorded $241,000 paid to the holders of the preferred stock accounted for as a beneficial conversion option on this preferred stock. In connection with this placement, the Company incurred transaction costs of approximately $166,000, which were netted against the gross proceeds.

 

-24-


Table of Contents
This excerpt taken from the EPIC DEF 14A filed Apr 12, 2005.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 

Except for the compensation agreements and other arrangements that are described under “Change of Control and Severance Agreements” and the transactions described below, there was not during fiscal year 2004 nor is there currently proposed, any transaction or series of similar transactions to which Epicor was or is to be a party in which the amount involved exceeds $60,000 and in which any director, nominee for director, executive officer, five percent stockholder or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest.

 

Other Related Party Transactions

George Klaus, the Company’s Chairman and CEO, is currently in an ongoing personal relationship with one of the Company’s Senior Vice Presidents. The Senior Vice President with whom he is having a relationship is not an “executive officer” of the Company, and she reports directly to an Executive Vice President of the Company and not directly to Mr. Klaus. In addition, following a thorough board review of the relationship, the Board has determined that, so long as Mr. Klaus remains in this relationship, all employment and compensation matters relating to her will be made by the Executive Vice President, subject to review and approval by the Board or a committee of the Board, rather than Mr. Klaus. She is currently compensated at a level that the Company believes is comparable to other employees in similar positions of responsibility at the Company.

 

On February 13, 2003, the Company completed a private placement of 300,000 shares of newly created Series D Preferred Stock resulting in gross proceeds to the Company of $5,730,000. The Company sold the shares, each of which is convertible into 10 shares of the Company’s common stock, to investment funds associated with Trident Capital (“Trident”, collectively, the “Trident Funds”), a venture capital firm in which one of the Company’s directors, Donald R. Dixon, serves as managing director, pursuant to a Series D Preferred Stock Purchase Agreement dated as of February 11, 2003 between the Company and Trident. Mr. Dixon is a managing director of Trident Capital, Inc., which is the general partner of Trident Capital, L.P., which is the general partner of Trident Capital Partners Fund -I, L.P. and Trident Capital Partners Fund -I, C.V.; Mr. Dixon is also a member of Trident Capital Management -V, LLC, which is the general partner of Trident Capital Fund-V, L.P., Trident Capital Fund-V Principals Fund, L.P., Trident Capital Fund-V Affiliates Fund, L.P., Trident Capital Fund-V Affiliates Fund (Q), L.P. and Trident Capital Parallel Fund-V, C.V.

 

The price of the Series D Preferred Stock was determined to be $19.10, reflecting the Company’s common stock closing price of $1.91 on February 10, 2003, the day preceding the purchase agreement.

 

Certain of the Trident Funds, acquired a total of 61,735 shares of Series C Preferred Stock; 25,415 shares were acquired on May 30, 1995 at a purchase price of $78.70 per share and 36,320 shares were acquired on March 5, 2003 at a purchase price of $19.10 per share. These shares were convertible at any time at the election of the holder on a 10-for-1 basis into common stock.

 

On November 12, 2004, certain of the Trident Funds effected a conversion of 131,842 shares of Series D Preferred Stock (convertible 10-for-1) into 1,318,420 shares of common stock, leaving a balance of 168,158 shares of Series D Preferred Stock that have not been converted. In addition, on

 

-27-


Table of Contents
 

November 12, 2004, certain of the Trident Funds effected a conversion of 61,735 shares of Series C Preferred Stock (convertible 10-for-1) into 617,350 shares of common stock, and no longer own any shares of Series C Preferred Stock.

 

The Company’s outstanding Series D Preferred Stock is convertible into common stock of the Company on a ten-for-one basis at any time at the option of the holders. Such shares automatically convert into common stock of the Company ten days after formal notification by the Company that the average consecutive 20-trading day closing stock price of the common stock has exceeded $5.73 per share and that the Company meets certain other conditions. The holders of Series D Preferred Stock are entitled to vote with holders of common stock on an as-converted basis and, pursuant to the terms of the Stock Purchase Agreement, the Company has agreed to register the sale of shares of common stock issuable upon conversion of the preferred stock.

 

The holders of the Series D Preferred Stock are entitled to receive, when and if declared by the Board of Directors, dividends out of any assets of the Company legally available. Such dividends are required to be paid prior to and on an equal basis to any dividend, which may be declared by the Board of Directors for holders of common stock. Dividends are not cumulative and no dividends have been declared or paid as of March 21, 2005. In the event of liquidation, dissolution or winding up of the Company, the holders of the Series D Preferred Stock shall be entitled to receive, in preference to any distribution to the common stockholders, an amount per share equal to $19.10, plus, while participating with shares of Common Stock, the greater of (i) $38.20 per share plus all accrued or declared but unpaid dividends on such shares or (ii) the amount per share that the holders of Series D Preferred Stock would have been entitled to receive had all holder of all series of Preferred Stock converted all their shares of Preferred Stock into Common Stock immediately prior to such event. Additionally, in the event that 50% or more of the Company’s voting power is transferred, or all or substantially all of the Company’s assets are acquired, the holders of the Series D Preferred Stock shall be entitled to receive the foregoing principal amounts payable upon a liquidation or dissolution.

 

During the first quarter of 2003, the Company recorded $241,000 for a fee paid to the holders of the preferred stock accounted for as a beneficial conversion option on this preferred stock. In connection with this placement, the Company incurred transaction costs of approximately $166,000, which were netted against the gross proceeds.

 

-28-


Table of Contents
This excerpt taken from the EPIC 10-K filed Mar 16, 2005.

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 

The information required hereunder is incorporated by reference from the sections of the Company’s Proxy Statement filed in connection with its 2005 Annual Meeting of Stockholders entitled “Certain Relationships and Related Transactions.”

 

Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki