Page 7 of 9 – SEC Filing
(f) Bandera
Master Fund is organized under the laws of the Cayman Islands. Bandera Partners is organized under the laws of the State of Delaware.
Each of Messrs. Bylinsky and Gramm are citizens of the United States of America.
| Item 3. | Source and Amount of Funds or Other Consideration. |
The Shares purchased
by Bandera Master Fund were purchased with working capital (which may, at any given time, include margin loans made by brokerage
firms in the ordinary course of business). The aggregate purchase price of the 258,256 Shares owned directly by Bandera Master
Fund is approximately $1,963,900, including brokerage commissions.
| Item 4. | Purpose of Transaction. |
The Reporting Persons
purchased the Shares based on the Reporting Persons’ belief that the Shares, when purchased, were undervalued and represented
an attractive investment opportunity. Depending upon overall market conditions, other investment opportunities available to the
Reporting Persons, and the availability of Shares at prices that would make the purchase or sale of Shares desirable, the Reporting
Persons may endeavor to increase or decrease their position in the Issuer through, among other things, the purchase or sale of
Shares on the open market or in private transactions or otherwise, on such terms and at such times as the Reporting Persons may
deem advisable.
In connection with
a Stock Purchase Agreement, dated November 16, 2017 (the “Stock Purchase Agreement”), pursuant to which Bandera Master
Fund purchased an aggregate of 221,784 Shares from Cross Atlantic Technology Fund II, L.P. and The Co-Investment 2000 Fund, L.P.
(together, “Cross Atlantic”), the Reporting Persons entered into a Stockholders Agreement, dated November 16, 2017
(the “Agreement”), with the Issuer. Pursuant to the Agreement, Jefferson Gramm was immediately appointed to the Issuer’s
Board of Directors (the “Board”) as a Class III director with a term expiring at the Issuer’s 2019 annual meeting
of stockholders (the “2019 Annual Meeting”). In the event that Mr. Gramm is unable to serve as a director, resigns
as a director or is removed as a director without cause prior to the 2019 Annual Meeting, the Reporting Persons shall have the
ability to recommend a substitute person for appointment or election to the Board, subject to Board approval.
Pursuant to the Agreement,
until the Termination Date (as defined below), the Reporting Persons agreed to appear at each stockholder meeting of the Issuer
and to vote all of their Shares in accordance with the Board’s recommendation with respect to each proposal to come before
the meeting. In addition, the Reporting Persons agreed (i) to certain customary standstill restrictions through the date that is
the earlier of (x) the third anniversary of the date of the Agreement and (y) five business days after Timothy Brog is no longer
the Company’s Chief Executive Officer (the “Termination Date”) and (ii) not to acquire any additional voting
securities of the Issuer until November 16, 2018 (provided that any securities of the Issuer granted or awarded to Mr. Gramm in
his capacity as a director of the Issuer shall not be subject to such restriction). Further, if the Reporting Persons’ beneficial
ownership is reduced to less than 5% of the outstanding Shares, the Reporting Persons must provide written notice to the Board
and the Issuer may, in its sole discretion, request Mr. Gramm to resign from the Board, in which case Mr. Gramm shall resign.
The foregoing description
of the Agreement is qualified in its entirety by reference to the Agreement, which is attached as Exhibit 99.1 hereto and is incorporated
herein by reference.
Except in Mr. Gramm’s
capacity as a director of the Issuer, no Reporting Person has any present plan or proposal which would relate to or result in any
of the matters set forth in subparagraphs (a) – (j) of Item 4 of Schedule 13D except as set forth herein or such as would occur
upon or in connection with completion of, or following, any of the actions discussed herein. The Reporting Persons reserve the
right to change their intention with respect to any and all matters referred to in this Item 4.
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