Filing Details

 

 

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CUSIP NO. 280358102

 

 

CUSIP NO. 280358102

 

 

 

 

 

CUSIP NO. 280358102

 

 

 

 

 

CUSIP NO. 280358102

 

 

 

 

 

CUSIP NO. 280358102

 

 

 

 

The following constitutes the Schedule 13D filed by the undersigned (the "Schedule 13D").

 

The Shares purchased by Lone Star Value Investors and Lone Star Value Co-Invest I, LP ("Lone Star Value Co-Invest I") and held in the Separately Managed Account were purchased with working capital (which may, at any given time, include margin loans made by brokerage firms in the ordinary course of business) in open market purchases, except as otherwise noted, as set forth in Schedule A, which is incorporated by reference herein.  The aggregate purchase price of the 689,927 Shares beneficially owned by Lone Star Value Investors is approximately $5,019,733, including brokerage commissions. The aggregate purchase price of the 60,000 Shares beneficially owned by Lone Star Value Co-Invest I is approximately $426,320, including brokerage commissions. The aggregate purchase price of the 50,000 Shares held in the Separately Managed Account is approximately $375,826, including brokerage commissions.

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.

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, and as described in Item 6 below, or such as would occur upon or in connection with completion of, or following, any of the actions discussed herein.  The Reporting Persons intend to review their investment in the Issuer on a continuing basis.  Depending on various factors including, without limitation, the Issuer's financial position and investment strategy, the price levels of the Shares, conditions in the securities markets and general economic and industry conditions, the Reporting Persons may in the future take such actions with respect to their investment in the Issuer as they deem appropriate including, without limitation, engaging in communications with management and the Board of the Issuer, engaging in discussions with stockholders of the Issuer and others about the Issuer and the Reporting Persons' investment, making proposals to the Issuer concerning changes to the capitalization, ownership structure, board structure (including Board composition) or operations of the Issuer, purchasing additional Shares, selling some or all of their Shares, engaging in short selling of or any hedging or similar transaction with respect to the Shares, or changing their intention with respect to any and all matters referred to in Item 4.

 

 

Item 5.

Interest in Securities of the Issuer.

The aggregate percentage of Shares reported owned by each person named herein is based upon 12,880,356 Shares outstanding as of January 9, 2017, which is the total number of Shares reported outstanding in the Issuer's most recently filed Schedule 14A, filed with the Securities and Exchange Commission on January 9, 2017.

A.	Lone Star Value Investors

(a)

As of the close of business on February 3, 2017, Lone Star Value Investors beneficially owned 689,927 Shares.

Percentage: Approximately 5.4%

(b)

1. Sole power to vote or direct vote: 689,927 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 689,927 4. Shared power to dispose or direct the disposition: 0

(c)

The transactions in the Shares by Lone Star Value Investors during the last 60 days are set forth in Schedule A and are incorporated herein by reference.

B.	Lone Star Value Co-Invest I

(a)

As of the close of business on February 3, 2017, Lone Star Value Co-Invest I beneficially owned 60,000 Shares.

Percentage: Less than 1%

(b)

1. Sole power to vote or direct vote: 60,000 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 60,000 4. Shared power to dispose or direct the disposition: 0

(c)

The transactions in the Shares by Lone Star Value Co-Invest I during the last 60 days are set forth in Schedule A and are incorporated herein by reference.

C.	Lone Star Value GP

(a)

Lone Star Value GP, as the general partner of Lone Star Value Investors and Lone Star Value Co-Invest I, may be deemed the beneficial owner of the (i) 689,927 Shares owned by Lone Star Value Investors and (ii) 60,000 Shares owned by Lone Star Value Co-Invest I.

Percentage: Approximately 5.8%

 

 

(b)

1. Sole power to vote or direct vote: 749,927 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 749,927 4. Shared power to dispose or direct the disposition: 0

(c)

Lone Star Value GP has not entered into any transactions in the Shares during the last 60 days.  The transactions in the Shares on behalf of Lone Star Value Investors and Lone Star Value Co-Invest I within the last 60 days are set forth in Schedule A and are incorporated herein by reference.

D.	Lone Star Value Management

(a)

As of the close of business on February 3, 2017, 50,000 Shares were held in the Separately Managed Account. Lone Star Value Management, as the investment manager of Lone Star Value Investors, Lone Star Value Co-Invest I and the Separately Managed Account, may be deemed the beneficial owner of the (i) 689,927 Shares owned by Lone Star Value Investors, (ii) 60,000 Shares owned by Lone Star Value Co-Invest, and (iii) 50,000 Shares held in the Separately Managed Account.

Percentage: Approximately 6.2%

(b)

1. Sole power to vote or direct vote: 799,927 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 799,927 4. Shared power to dispose or direct the disposition: 0

(c)

Lone Star Value Management has not entered into any transactions in the Shares during the last 60 days. The transactions in the Shares on behalf of Lone Star Value Investors and Lone Star Value Co-Invest I during the last 60 days are set forth in Schedule A and are incorporated herein by reference.

E.	Mr. Eberwein

(a)

Mr. Eberwein, as the manager of Lone Star Value GP and sole member of Lone Star Value Management, may be deemed the beneficial owner of the (i) 689,927 Shares owned by Lone Star Value Investors, (ii) 60,000 Shares owned by Lone Star Value Co-Invest and (ii) 50,000 Shares held in the Separately Managed Account.

Percentage: Approximately 6.2%

(b)

1. Sole power to vote or direct vote: 799,927 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 799,927 4. Shared power to dispose or direct the disposition: 0

 

 

 

 

(c)

Mr. Eberwein has not entered into any transactions in the Shares during the last 60 days.  The transactions in the Shares on behalf of Lone Star Value Investors and Lone Star Value Co-Invest I during the last 60 days are set forth in Schedule A and are incorporated herein by reference.

(d)

No person other than the Reporting Persons is known to have the current right to receive, or the power to direct the receipt of dividends from, or proceeds from the sale of, the Shares.

Item 6.

Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

On March 24, 2016, as reported within the Issuers Form 8-K filed on March 25, 2016 some of the Reporting Persons entered into an agreement ("Agreement") with the Issuer in connection with the expansion of the Board of Directors of the Issuer (the "Board") and the addition of two new independent directors, who as of the date hereof currently serve on the Board. The Agreement further provides that Lone Star Value is subject to certain standstill provisions, such as provisions that restrict the Reporting Persons ability to engage in proxy solicitations, make certain stockholder proposals, call meetings of stockholders, and similar other provisions. Such provisions generally remain in effect until the date that is 30 days prior to the expiration of the Issuer's advance notice period for the nomination of directors at the Issuer's 2017 Annual Meeting of Stockholders.

On February 1, 2017, the Reporting Persons entered into a Joint Filing Agreement in which the Reporting Persons agreed to the joint filing on behalf of each of them of statements on Schedule 13D with respect to securities of the Issuer, to the extent required by applicable law.  A copy of this agreement is attached as exhibit 99.1 hereto and is incorporated herein by reference.

 

Other than as described herein, there are no contracts, arrangements, understandings or relationships among the Reporting Persons, or between the Reporting Persons and any other person, with respect to the securities of the Issuer.

99.1 Joint Filing Agreement by and among Lone Star Value Investors, LP; Lone Star Value Co-Invest I, LP; Lone Star Value Investors GP, LLC; Lone Star Value Management, LLC; and Jeffrey E. Eberwein, dated February 1, 2017.

 

 

 

 

After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated:  February 2, 2017

 

 

 

 

 

^* Purchased in private transaction from counterparty.

 

 

 

 

 

 

 

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