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This excerpt taken from the ISYS 8-K filed Dec 21, 2009.

(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))

 

 

 


Item 4.01 Changes in Registrant’s Certifying Accountant

(a) Former independent registered public accounting firm

On December 15, 2009, the Audit Committee of the Board of Directors of Integral Systems, Inc. (the “Company”) approved the dismissal of Ernst & Young LLP (“E&Y”) as the independent registered public accounting firm for the Company.

The reports of E&Y on the Company’s consolidated financial statements and on the effectiveness of the Company’s internal control over financial reporting and management’s assessment thereof for the fiscal years ended September 25, 2009 and September 30, 2008 did not contain an adverse opinion or a disclaimer of opinion, nor were such reports qualified or modified as to uncertainty, audit scope, or accounting principle, except as follows: (1) as disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2008, filed with the Securities and Exchange Commission (“SEC”) on December 24, 2008, E&Y expressed an adverse opinion on the Company’s internal control over financial reporting as of September 30, 2008 due to material weaknesses in (a) the Company’s application level internal controls over the recognition of revenue and related transactions and (b) entity level controls over monitoring of the financial statement close and financial reporting processes; and (2) as disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended September 25, 2009, filed with the SEC on December 9, 2009, E&Y expressed an adverse opinion on the Company’s internal control over financial reporting as of September 25, 2009 due to material weaknesses in (a) application level internal controls over the recognition of revenue and related transactions and (b) entity level internal controls over monitoring the Company’s financial statement close and financial reporting processes.

During the fiscal year ended September 30, 2008, there were no disagreements with E&Y on any matter of accounting principle or practice, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of E&Y, would have caused them to make reference thereto in their reports on the financial statements for such years. During the fiscal year ended September 25, 2009, there was a disagreement, which was satisfactorily resolved, relating to management’s assessment of the likelihood of realization of all recorded amounts of revenue for certain government contracts. Such disagreement arose in late November of 2009, and after discussions with E&Y, the Company agreed to record the audit adjustment proposed by E&Y to reduce unbilled revenues and revenues by approximately $2.1 million in the aggregate. The Company’s Audit Committee discussed this disagreement with E&Y. The Company has authorized E&Y to respond fully to the inquiries of the successor auditor concerning the subject matter of the disagreement.

During the years ended September 25, 2009 and September 30, 2008, and through December 15, 2009, there were no “reportable events” requiring disclosure pursuant to paragraph (a)(1)(v) of Item 304 of Regulation S-K.

The Company has provided E&Y with a copy of this Form 8-K prior to its filing with the SEC. The Company requested that E&Y furnish the Company with a letter addressed to the SEC stating whether or not E&Y agrees with the above statements. A copy of E&Y’s letter dated December 18, 2009 is filed as Exhibit 16.1 to this Form 8-K.

(b) New independent registered public accounting firm

On December 15, 2009, the Audit Committee of the Board of Directors of the Company, following a comprehensive evaluation of several leading public accounting firms, a process that commenced in September 2009, engaged KPMG LLP (“KPMG”) as the Company’s new independent registered public accounting firm.

The Company has not, nor has anyone on its behalf, consulted KPMG during the two most recently completed fiscal years and through December 15, 2009, regarding either (1) the application of accounting principles to a specific transaction, either completed or proposed, or the type of audit opinion that might be rendered on the consolidated financial statements of the Company and no written report or oral advice was provided by KPMG to the Company that KPMG concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing, or financial reporting issue, or (2) any matter that was the subject of either the disagreement described above nor any other disagreements as defined in paragraph (a)(1)(iv) of Item 304 of Regulation S-K or a reportable event described in paragraph (a)(1)(v) of Item 304 of Regulation S-K.


Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit

  

Description

16.1    

   Letter from Ernst & Young LLP


This excerpt taken from the ISYS 8-K filed Nov 18, 2009.

(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))

 

 

 


Item 8.01 Other Events.

On November 18, 2009, a shareholder derivative action brought by shareholder William Thirkill, has been voluntarily dismissed without prejudice.

The action, filed on July 14, 2009 in the United States District Court for the District of Maryland, alleged a breach of fiduciary duty resulting from the Company’s restatement of its interim financial statements for the first three quarters of fiscal year 2008. With this dismissal, all shareholder derivative actions have been withdrawn by plaintiffs or dismissed by the courts without any findings against the company or its current management team.


Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit

  

Description

99.1    Press Release dated November 18, 2009.


This excerpt taken from the ISYS 8-K filed Nov 9, 2009.

(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))

 

 

 


Item 8.01 Other Events.

On November 9, 2009, a shareholder derivative demand letter submitted to the Company and its Board of Directors on behalf of shareholder Harshad Patel has been withdrawn. The shareholder submitted the demand letter to the Company’s board of directors on March 3, 2009, alleging a breach of fiduciary duty resulting from the Company’s restatement of its interim financial statements for the first three quarters of fiscal year 2008.


Item 9.01 Financial Statements and Exhibits.
This excerpt taken from the ISYS 8-K filed Oct 21, 2009.

(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))

 

 

 


This excerpt taken from the ISYS 8-K filed Sep 21, 2009.

(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))

 

 

 


This excerpt taken from the ISYS 8-K filed Aug 27, 2009.

(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))

 

 

 


This excerpt taken from the ISYS 8-K filed Aug 17, 2009.

(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))

 

 

 


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

On August 10, 2009, the Board of Directors of Integral Systems, Inc. (the “Company”) appointed Major General (Ret.) H. Marshal Ward, 63, to a newly created position as the Company’s Chief Operating Officer, effective August 31, 2009.

General Ward previously served as the Vice President and General Manager, Space Systems and Electronics at BAE systems, a global defense, security and aerospace company, a position he held from 2001 to August 2009. Prior to joining BAE Systems, General Ward served in a variety of positions in the United States Air Force from 1969 to 2001, most recently as Director, Special Programs from 1998 to 2001. General Ward holds a Masters of Business Administration degree from Auburn University and a Bachelor of Science degree from Florida State University.

The Ward Agreement

On August 10, 2009, the Company entered into an agreement, effective August 31, 2009 (the “Effective Date”) with General Ward that covers the terms of his employment with the Company as Chief Operating Officer (the “Ward Agreement”). The term of the Ward Agreement is three years from the Effective Date, with automatic renewal periods of twelve months, unless either the Company or General Ward provides at least 180 days advance written notice of non-renewal. The financial terms of the Ward Agreement include (1) an annual base salary of $300,000 and (2) an annual target bonus opportunity of 50% of his base salary. General Ward’s annual target bonus opportunity and any actual bonus will be determined pursuant to the Company’s annual incentive compensation plan. The Company will also provide General Ward with an extended residence stay and a rental car for four weeks following the Effective Date, and the Company will reimburse General Ward for the cost of one round-trip, coach-class ticket per week from BWI airport or another area airport to Manchester, New Hampshire during the term of the Ward Agreement. Mr. Ward will not receive any tax gross-up for these amounts.

The Ward Agreement further provides that within thirty days after the Effective Date, the Company will grant to General Ward stock options to purchase 50,000 shares of the Company’s common stock. Such stock options will be subject to the vesting restrictions and other terms and conditions set forth in the Company’s 2008 Stock Incentive Plan and the Company’s standard form of award agreement for options under that plan. The Company also will consider additional awards of stock options or other equity awards annually under the Company’s equity incentive plan.

If General Ward’s employment is terminated by the Company without Cause, due to death or Total Disability, or if General Ward terminates his employment for Good Reason (as such terms are defined in the Ward Agreement), payments from the Company will include, subject to General Ward’s execution of the Company’s standard release of claims, (1) one year of base salary, (2) a bonus for the fiscal year in which termination occurs equal to what he would have earned that year, (3) COBRA premiums for him and any eligible dependents for one year (except in the case of termination due to death or Total Disability, as defined in the Ward Agreement) and (4) any other benefits due under the Company’s employee benefit plans.


Following any change in control (as defined in the Company’s standard form of award agreement for options granted under the 2008 Stock Incentive Plan), any unvested portion of stock options or any equity awards made to General Ward will immediately vest and become exercisable in full (1) if such change in control occurs at any time while he is still an employee of the Company, to the extent the options or any equity awards are not assumed by the acquiror or successor entity or (2) if the options or other equity awards are assumed by the acquiror or successor entity in connection with such change in control and General Ward’s employment with the Company is terminated by the Company without Cause or by General Ward for Good Reason within twelve months following the change in control.

Finally, General Ward also is subject to certain restrictive covenants relating to non-competition, non-solicitation, confidentiality and non-disparagement.

The preceding summary of the Ward Agreement is qualified in its entirety by reference to the text of the agreement, which is filed with this report as Exhibit 10.1.

There are no family relationships between General Ward and any director or executive officer of the Company, nor are there any arrangements or understandings between General Ward and any other persons pursuant to which General Ward was selected as Chief Operating Officer. Neither General Ward, nor any member of his immediate family, has been, or currently is, a party, directly or indirectly, to any transaction or currently proposed transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.

The Company issued a press release regarding General Ward’s appointment, a copy of which is attached to this report as Exhibit 99.1.

 

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit

Number

 

Description

10.1

  Employment Agreement by and between Integral Systems, Inc. and General H. Marshal Ward.

99.1

  Press Release, dated August 17, 2009.


This excerpt taken from the ISYS 8-K filed Aug 14, 2009.

(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))

 

 

 


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

Compensatory Arrangement of Paul G. Casner, Jr.

As previously reported by Integral Systems, Inc. (the “Company”) in its Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on August 11, 2009 (the “Initial Report”), the Board of Directors of the Company (the “Board”) has appointed Paul G. Casner, Jr. as interim Chief Executive Officer of the Company effective August 5, 2009. On August 10, 2009, the Compensation Committee of the Board of directors agreed upon a compensation arrangement for Mr. Casner for his service as interim Chief Executive Officer. This Current Report on Form 8-K/A amends the Initial Report to add the information regarding the compensation of Mr. Casner.

Mr. Casner’s base salary is three hundred ninety thousand dollars ($390,000) per annum. Mr. Casner will be issued options to purchase one hundred thousand (100,000) shares of the Company’s common stock under the Company’s 2008 Stock Incentive Plan (as described in the Company’s Annual Report on Form 10-K filed with the SEC on December 24, 2008), which options (i) have an exercise price equal to the closing price of the Company’s stock on August 10, 2009, or seven dollars and thirty-one cents ($7.31), (ii) shall vest in three equal installments on the first three anniversaries of the date of grant and (iii) have a term of ten (10) years. Mr. Casner will be eligible to receive an annual cash incentive bonus for fiscal year 2009 at the discretion of the Board. If the Board determines that Mr. Casner should receive such a bonus, the amount will be determined by the Board at a later date. In fiscal year 2010, Mr. Casner will participate in the Integral Systems, Inc. Incentive Compensation Plan as established by the Compensation Committee of the Board (as described in the Company’s definitive proxy statement filed with the SEC on January 22, 2009). Mr. Casner is also eligible to participate in benefit plans that are generally available to the Company’s employees, such as the 401(k) plan, disability and life insurance, and vacation, sick and holiday time off.


This excerpt taken from the ISYS 8-K filed Aug 11, 2009.

(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))

 

 

 


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

Resignation of Chief Executive Officer, President and Director.

On August 5, 2009, John B. Higginbotham informed the Board of Directors of Integral Systems, Inc. (the “Company”) of his resignation as Chief Executive Officer, President and Director of the Company, effective immediately.

On August 10, 2009, the Company entered into an Agreement and Release (the “Release”) with Mr. Higginbotham. Under the terms of the Release, the Company agreed to continue to pay Mr. Higginbotham his current base salary (at the annual rate of $390,000), in installments on the Company’s regular payroll schedule, and healthcare premiums under the Consolidated Omnibus Budget Reconciliation Act for Mr. Higginbotham and his dependents, for twelve (12) months. In addition, the Release provides for a one-time payment of $100,000 within fifteen (15) days of execution of the Release and a payment equal to the cash value of Mr. Higginbotham’s accrued vacation, sick leave and personal days promptly following execution of the Release. The Release also provides for the vesting of 100,000 stock options granted to Mr. Higginbotham on May 9, 2009 (the “Options”) and permits Mr. Higginbotham to exercise such Options until August 5, 2014. All other stock options granted to Mr. Higginbotham are forfeited, effective immediately. Finally, the Company will pay Mr. Higginbotham a bonus with respect to fiscal year 2009, such bonus to be determined in the same manner as the annual bonus for fiscal year 2009 is determined for the remaining executive officers of the Company, and will pay Mr. Higginbotham a change of control bonus, if such a bonus becomes payable before January 9, 2011 pursuant to the terms of the Employment Agreement between the Company and Mr. Higginbotham, dated July 9, 2008 and as amended August 7, 2008 and February 20, 2009 (the “Employment Agreement”); provided that, in the event that the change of control bonus becomes payable, Mr. Higginbotham must elect prior to the applicable change of control whether to receive such change of control bonus or to exercise the Options. In the event that Mr. Higginbotham elects to receive such change of control bonus, the amount payable to Mr. Higginbotham shall be reduced by the amount of any proceeds received by Mr. Higginbotham in connection with the sale of stock acquired pursuant to the exercise of the Options prior to the change of control. If Mr. Higginbotham elects to receive the change of control bonus, any remaining Options as of such date shall be forfeited, effective immediately. The Employment Agreement was filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission (the “SEC”) on July 11, 2008. The First Amendment to the Employment Agreement was filed as Exhibit 10.1 to the Company’s Report on Form 8-K, filed with the SEC on August 8, 2008, and the Second Amendment to the Employment Agreement was filed as Exhibit 10.1 to the Company’s Report on Form 8-K, filed with the SEC on February 20, 2009. The foregoing summary of the Release is qualified in its entirety by reference to the full text of the Release, which is filed as Exhibit 10.1 to this report.

The Release also contains a mutual release of claims and Mr. Higginbotham’s agreement to comply with the confidentiality, non-competition and non-solicitation covenants contained in the Employment Agreement, as well as the covenants in his Confidentiality Agreement with the Company, dated July 11, 2008. The Release otherwise supersedes the Employment Agreement.


Appointment of Interim Chief Executive Officer and President.

On August 5, 2009, the Board of Directors appointed Paul G. Casner, Jr., 71, a current member of the Board of Directors, to the office of Interim Chief Executive Officer and President, effective immediately. Mr. Casner will continue to serve as a director of the Company, but is resigning his membership on the Audit, Compensation, Nominating, Strategic Growth and Special Committees of the Board of Directors, effective concurrent with his appointment. William F. Leimkuhler, an independent member of the Board of Directors, will take over the chairmanship of the Compensation Committee.

Mr. Casner did not participate in the deliberations and voting of the Board of Directors relating to his appointment.

Mr. Casner joined the Board of Directors on December 18, 2006. On April 30, 2005, Mr. Casner retired from DRS Technologies, Inc., a supplier of integrated products, services and support to military forces, intelligence agencies and prime contractors worldwide, as Executive Vice President of Operations and Chief Operating Officer. Mr. Casner had served at DRS Technologies as Executive Vice President of Operations since 1998 and Chief Operating Officer since 2000. Mr. Casner previously formed Technical Applications and Service Company (TAS) in 1991, which purchased the assets of the Norden Service Company and merged into DRS Technologies in 1993. Following the merger, Mr. Casner became President of DRS Electronic Systems, a position he held until 1994. Previously, Mr. Casner served as President and Chief Executive Officer of the Norden Service Company, a company he joined in 1984 as Vice President in Charge of Maryland Operations, eventually advancing to the role of Senior Vice President of Engineering for all Norden Systems. In 1979, Mr. Casner co-founded American Computer and Electronics Corporation, where he grew the military segment of the company and led the effort to develop a Console Emulation Capability, which was used by the U.S. Navy for combat training. After graduating from Drexel University, Mr. Casner joined the staff of The Johns Hopkins Applied Physics Laboratory (APL) and advanced to the status of Principal Staff. Mr. Casner earned a Bachelor of Science degree in Electrical Engineering from Drexel University and a Master of Science degree in Management Science from The Johns Hopkins University. He is a member of the Naval Reserve Association and is a Commodore of the Navy League of the United States, in addition to other professional affiliations. Mr. Casner has more than 40 years of defense industry experience, which includes several senior positions in business management, technical management, strategic planning and business development. In addition, Mr. Casner serves on the Board of Directors of Mikros Systems Corporation, Atair Aerospace, Inc. and Aurora Flight Sciences Corporation.

There are no family relationships between Mr. Casner and any executive officer or other director of the Company, nor are there any arrangements or understandings between Mr. Casner and any other persons pursuant to which Mr. Casner was selected as Interim Chief Executive Officer and President of the Company. Neither Mr. Casner, nor any member of his immediate family, has been, or currently is, a party, directly or indirectly, to any transaction or currently proposed transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.


The terms of Mr. Casner’s compensation for his service as Interim Chief Executive Officer and President are being considered by the Board’s Compensation Committee and will be disclosed in a report on Form 8-K once finalized. Mr. Casner will no longer receive compensation for his services as a director.

The Company issued a press release regarding Mr. Higginbotham’s resignation and the appointment of Mr. Casner, a copy of which is attached as Exhibit 99.1.


Item 9.01 Financial Statements and Exhibits.

 

  (d) Exhibits

 

Exhibit
Number

  

Description

10.1    Agreement and Release between John B. Higginbotham and Integral Systems, Inc., dated August 10, 2009.
99.1    Press Release, dated August 5, 2009.


This excerpt taken from the ISYS 8-K filed Aug 7, 2009.

(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))

 

 

 


Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year

On August 5, 2009, the Board of Directors of Integral Systems, Inc. (“Integral” or the “Company”) adopted an amendment (the “Amendment”) to the Amended and Restated By-laws of the Company, as previously amended (the “By-laws”), effective immediately, amending (i) the provision of the By-laws relating to the Company’s fiscal year and (ii) the provision of the By-laws relating to changes to the By-laws. The Amendment provides that the Company’s fiscal year ends on the last Friday in September of each year. Under the By-laws prior to the adoption of the Amendment, the Company’s fiscal year ended on September 30th of each year. In addition, the Amendment clarifies that the vote required for the Board of Directors to change the By-laws is a majority vote of the Board of Directors. The By-laws previously provided that action of the whole Board of Directors was required to make changes to the By-laws.

The Amendment is set forth in Amendment No. 5 to the By-laws, which is filed, together with the By-laws, as Exhibit 3.1 to this Current Report on Form 8-K.

 

Item 9.01 Financial Statements and Exhibits.

 

  (d) Exhibits

 

Exhibit
Number

 

Description

3.1   Amended and Restated By-laws of Integral Systems, Inc., as amended by Amendments No. 1, 2, 3, 4 and 5 to the Amended and Restated By-laws of Integral Systems, Inc.


This excerpt taken from the ISYS 8-K filed Jul 31, 2009.

(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))

 

 

 


Item 7.01 Regulation FD Disclosure.

On July 30, 2009, Integral Systems, Inc. (“Integral” or the “Company”) issued a press release announcing a final settlement with the Securities and Exchange Commission regarding an investigation by the Securities and Exchange Commission that has been ongoing since March 2007. The investigation is described in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30. 2008. A copy of the press release is furnished as Exhibit 99.1 hereto.

The information reported in this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.

 

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

The following materials are attached as exhibits to this Current Report on Form 8-K:

 

Exhibit
Number

 

Description

99.1   Press release dated July 30, 2009.


This excerpt taken from the ISYS 8-K filed Jul 29, 2009.

(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))

 

 

 


This excerpt taken from the ISYS 8-K filed Jun 30, 2009.

(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))

 

 

 


This excerpt taken from the ISYS 8-K filed May 14, 2009.

(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))

 

 

 


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

New Director.

On May 8, 2009, the Board of Directors of Integral Systems, Inc. (the “Company”) increased the size of the Board of Directors (the “Board”) from seven directors to eight directors and appointed Mr. Bruce L. Lev to the Board.

Mr. Lev is a Managing Director of Loeb Partners Corp., an investment firm based in New York City, a position he has held since 2003. Mr. Lev also is Of Counsel at the law firm Lev & Berlin, P.C. Previously, Mr. Lev was Vice Chairman and Director of USCO Logistics, a service provider of supply chain management, from 2000 to 2003. From 1995 through 2000, Mr. Lev served as Executive Vice President of Corporate and Legal Affairs of Micro Warehouse Inc., a $2.5 billion direct marketer of brand name personal computers and accessories to commercial and consumer markets. Mr. Lev is a graduate of Wesleyan University and the University of Virginia School of Law and is a member of the Connecticut, Virginia and Supreme Court bars.

In connection with Mr. Lev’s appointment to the Board, on May 8, 2009, the Compensation Committee awarded him 15,000 stock options under the 2008 Stock Incentive Plan, with an exercise price of $8.32 per share based on the fair market value of the Company’s common stock on that date.

Amendment to Employment Agreement.

On May 8, 2009, the Company also entered into the Second Amendment (the “Second Amendment”) to the employment agreement by and between the Company and William M. Bambarger, Jr., the Company’s Chief Financial Officer and Treasurer, as previously amended (the “Agreement”). The Second Amendment adds a new Section 4.7 to the Agreement, which provides that all of Mr. Bambarger’s unvested stock options and other equity awards will immediately vest (i) following any change in control (as defined in the Company’s standard form of award agreement for options granted the under the 2008 Stock Incentive Plan), to the extent such options or awards are not assumed by the acquiror or successor entity in connection with such change in control or (ii) if the stock options and other equity awards are assumed by the acquiror or successor entity in connection with such change in control and Mr. Bambarger’s employment with the Company is terminated by the Company without Cause or by Mr. Bambarger for Good Reason (as such terms are defined in the Agreement) within twelve months following the change in control.

The foregoing summary of the Second Amendment is not a complete description of all of the terms and conditions of the Second Amendment and is qualified in its entirety by reference to the text of the Second Amendment, a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K.


Bonus Awards.

Also on May 8, 2009, the Compensation Committee of the Board recommended to the Board, and the Board approved, discretionary cash bonus awards of $55,000 to John B. Higginbotham, the Company’s Chief Executive Officer and President, and $25,000 to William M. Bambarger, Jr., the Company’s Chief Financial Officer and Treasurer, in recognition of their outstanding contributions to the Company.

Approval of Stock Option Grants.

On May 8, 2009, the Compensation Committee of the Board also awarded the following stock options under the 2008 Stock Incentive Plan, with an exercise price of $8.32 per share based on the fair market value of the Company’s common stock on that date:

 

   

John B. Higginbotham, Chief Executive Officer, President and Director – 100,000 options;

 

   

William M. Bambarger, Jr., Chief Financial Officer and Treasurer – 50,000 options;

 

   

R. Miller Adams, Executive Vice President and General Counsel – 50,000 options;

 

   

Stuart C. Daughtridge, Executive Vice President, Commercial Division – 30,000 options;

 

   

James Kramer, Senior Vice President, Commercial Systems – 30,000 options;

 

   

James Frelk, Senior Vice President, Corporate Development – 30,000 options;

 

   

John M. Albertine, Chairman of the Board of Directors – 25,000 options;

 

   

James Armor, Director – 15,000 options;

 

   

Paul G. Casner, Jr., Director and Compensation Committee Chair – 20,000 options;

 

   

William F. Leimkuhler, Director and Audit Committee Chair – 20,000 options; and

 

   

R. Doss McComas, Director and Special Committee Chair – 15,000 options.

One-third of the stock options granted will vest on each of the first three anniversaries of the grant date, and the stock options will expire on the tenth anniversary of the grant date.


Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

The following material is attached as an exhibit to this Current Report on Form 8-K.

 

Exhibit
Number

  

Description

10.1    Second Amendment to Employment Agreement by and between Integral Systems, Inc. and William M. Bambarger, Jr.


This excerpt taken from the ISYS 8-K filed May 5, 2009.

(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))

 

 

 


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