Attached files
file | filename |
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EX-10.4 - EXHIBIT 10.4 - GTSI CORP | c07489exv10w4.htm |
EX-10.3 - EXHIBIT 10.3 - GTSI CORP | c07489exv10w3.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
(Amendment No. 1)
(Amendment No. 1)
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 19, 2010
GTSI Corp.
(Exact name of registrant as specified in its charter)
Incorporated in Delaware | 1-34871 | 54-1248422 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
2553 Dulles View Drive, #100 Herndon, Virginia |
20171-5219 |
|
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code: (703) 502-2000
(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:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Explanatory Note
This Amendment No. 1 to Form 8-K is being filed to amend information in Items 1.01, 2.03 (by
incorporation by reference), 5.02 and 9.01 of GTSIs original Form 8-K filed on October 25, 2010.
In particular, this Amendment No. 1 revises the description under Amended and Restated Credit
Agreement of Item 1.01 to include GTSIs restriction with respect to repurchasing GTSIs common
stock. In addition, this Amendment No. 1 revises the disclosure under Resignation of Chief
Executive Officer/Director and Senior Vice President/General Counsel of Item 5.02 to include a
description of the separation agreements with Scott W. Friedlander and Charles E. DeLeon. Item
9.01 was also amended to add the separation agreements with Mr. Friedlander and Mr. DeLeon as
exhibits.
Item 1.01 Entry into a Material Definitive Agreement.
Administrative Agreement
GTSI Corp. (GTSI) entered into an administrative agreement with the U.S. Small Business
Administration (the SBA) on October 19, 2010 (the Agreement). Pursuant to the Agreement, the
SBA lifted the temporary federal contract suspension it imposed on GTSI on October 1, 2010. As a
result, GTSI may, subject to the Agreement, resume full business with most of its existing clients
and pursue new contracts with the federal government.
Pursuant to the Agreement, GTSI agreed that it will not obtain or attempt to obtain any new
federal governmental contracts, subcontracts or any business, which in any capacity, whether
directly or indirectly is intended to benefit small businesses, including task orders and options
on existing contracts. This includes benefits in circumstances involving small businesses serving
as prime contractors and joint ventures with small businesses. GTSI will also discontinue
participating in the SBAs mentor-protégé program. GTSI further agreed to retain an SBA-approved
monitor to regularly report to the SBA on GTSIs compliance with the Agreement and applicable
government contracting laws and regulations (the Monitor). The term of the Agreement commenced on
October 19, 2010 and will terminate on the earlier of a) October 19, 2013, b) the 90th
day after the SBAs Office of Inspector Generals notification of the completion of its continuing
investigation of GTSI, or c) the notification date of any proposed debarment of GTSI by the SBA.
In connection with the Agreement, GTSI accepted the voluntary resignations of Scott
Friedlander as Chief Executive Officer, President and Director, and Charles DeLeon as a Senior Vice
President and General Counsel, both effective as of October 26, 2010. GTSI also agreed to suspend
three other employees for the term of the Agreement. GTSI committed to adopt, implement and
maintain a self-governance program that includes a business ethics program that covers all
employees. As part of the business ethics program, GTSI will create a position and designate an
employee as GTSIs Ethics Officer, who will be responsible for managing all aspects of the business
ethics program. At least once each calendar year, GTSI will conduct an internal audit of its
business practices, procedures, policies and internal controls for compliance with the Agreement,
GTSIs Code of Business Ethics and the special requirements regarding government contracting and
report the results of such audit to the SBA and the Monitor.
The foregoing description of the Agreement does not purport to be complete and is qualified in
its entirety by reference to the full text of the Agreement, a copy of which is filed herewith as
Exhibit 10.1.
GTSI issued a press release announcing that the SBA has lifted the temporary suspension. A
copy of the press release, dated October 19, 2010, is attached hereto as Exhibit 99.1.
Amended and Restated Credit Agreement
GTSI Corp. entered into an Amended and Restated Credit Agreement, dated as of October 19,
2010, with Castle Pines Capital LLC (CPC) and Wells Fargo Capital Finance, LLC, formerly known as
Wells Fargo Foothill, LLC (the Amended and Restated Agreement).
The Amended and Restated Agreement amends and restates the Companys Credit Agreement,
effective as of May 27, 2009 (the Original Credit Agreement), as amended, by and among GTSI, CPC
and Wells Fargo Foothill, LLC. For a discussion of the Original Credit Agreement and the First
Amendment to the Original Credit Agreement, also effective as of May 27, 2009, see GTSIs Form 8-K
filed with the Securities and Exchange Commission (the SEC) on June 2, 2009, which report is
hereby incorporated by reference into this Item 1.01. For a discussion of the Second and Third
Amendments to the Original Credit Agreement, see GTSIs Form 8-K filed with the SEC on
September 21, 2010, which report is also hereby incorporated by reference into this Item 1.01.
The Amended and Restated Agreement incorporates the First, Second and Third Amendments to the
Original Credit Agreement. The Amended and Restated Agreement also reduced the total facility limit
from an aggregate principal amount of $135 million to an aggregate principal amount of $100
million. Further, the Amended and Restated Agreement reduced the aggregate revolving loan facility
limit from $60 million to $45 million. In addition, the Amended and Restated Agreement no longer
allows GTSI to repurchase any of its common stock. Other than as noted above, there were no other
material changes made to the Original Credit Agreement, as amended.
The foregoing description of the Amended and Restated Agreement does not purport to be
complete and is qualified in its entirety by reference to the full text of the Amended and Restated
Agreement, a copy of which is filed herewith as Exhibit 10.2.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant.
The information above under Amended and Restated Credit Agreement in Item 1.01 is hereby
incorporated by reference into this Item 2.03.
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/Director and Senior Vice President/General Counsel
Effective October 26, 2010 (the Effective Date), Scott W. Friedlander voluntarily resigned
as Chief Executive Officer, President and a Director of GTSI and Charles E. DeLeon voluntarily
resigned as a Senior Vice President and General Counsel of GTSI.
GTSI entered into a separation agreement with Mr. Friedlander providing for his resignation as
Chief Executive Officer, President and a Director. The separation agreement between GTSI and Mr.
Friedlander provides that 1) GTSI will pay Mr. Friedlander on a bi-weekly basis his ending salary
rate of $400,000 per year for a period of twelve months beginning as of the Effective Date, subject
to acceleration upon a change of control, 2) GTSI will pay Mr. Friedlander a one-time severance
payment of $450,000, 3) for a period of up to 18 months following the Effective Date, GTSI will
reimburse Mr. Friedlander for COBRA expenses, 4) for a period of up to 12 months following the
Effective Date, GTSI will continue to provide Mr. Friedlander with continued participation in
GTSIs long term care plan, and 5) the exercise period of Mr. Friedlanders unexercised options to
purchase GTSI common stock as of the Effective Date shall be extended to the maximum exercise
period permitted by GTSIs applicable equity compensation plan(s).
Mr. Friedlander has provided GTSI and GTSIs affiliates with a general release of all claims
he has or may have against GTSI and GTSIs affiliates arising out of or relating to Mr.
Friedlanders business and/or employment relationship with GTSI. GTSI has also provided Mr.
Friedlander with a reciprocal general release and continued indemnification. The separation
agreement also prohibits Mr. Friedlander from 1) disclosing or using any confidential information,
2) soliciting GTSI employees for a period of 12 months following the Effective Date, and 3)
competing with GTSI for a period of 12 months following the Effective Date.
GTSI also entered into a separation agreement with Mr. DeLeon providing for his resignation as
a Senior Vice President and General Counsel. The separation agreement between GTSI and Mr. DeLeon
provides that 1) GTSI will pay Mr. DeLeon on a bi-weekly basis his ending six-month salary rate of
$130,000 for a period of six months beginning as of the Effective Date, subject to acceleration
upon a change of control, 2) GTSI will pay Mr. DeLeon a one-time severance payment of $130,000, 3)
for a period of up to 18 months following the Effective Date, GTSI will reimburse Mr. DeLeon for
COBRA expenses, 4) for a period of up to 12 months following the Effective Date, GTSI will continue
to provide Mr. DeLeon with continued participation in GTSIs long term care plan, and 5) the
exercise period of Mr. DeLeons unexercised options to purchase GTSI common stock as of the
Effective Date shall be extended to the maximum exercise period permitted by GTSIs applicable
equity compensation plan(s).
Mr. DeLeon has provided GTSI and GTSIs affiliates with a general release of all claims he has
or may have against GTSI and GTSIs affiliates arising out of or relating to Mr. DeLeons business
and/or employment relationship with GTSI. GTSI has also provided Mr. DeLeon with a reciprocal
general release and continued indemnification. The separation agreement also prohibits Mr. DeLeon
from 1) disclosing or using any confidential information, 2) soliciting GTSI employees for a period
of 12 months following the Effective Date, and 3) competing with GTSI for a period of 12 months
following the Effective Date.
The foregoing descriptions of the separation agreements do not purport to be complete and are
qualified in their entirety by reference to the full texts of the separation agreements, copies of
which are filed herewith as Exhibits 10.3 and 10.4.
Appointment of Acting Co-Chief Executive Officers
In connection with Mr. Friedlanders voluntary resignation, GTSIs Board of Directors (the
Board) appointed Sandra Gillespie, age 49, and Peter Whitfield, age 51, to serve on an interim
basis as acting Co-Chief Executive Officers, effective October 26, 2010. Ms. Gillespie is a Senior
Vice President of GTSI and Peter Whitfield is a Senior Vice President and Chief Financial Officer
of GTSI, both of whom continue to hold these positions. Ms. Gillespie and Mr. Whitfield will serve
as acting Co-Chief Executive Officers until a permanent replacement for Mr. Friedlander has been
appointed. The Board does not currently intend to modify the employment contracts or compensation
elements for the interim Co-Chief Executive Officers. The Board anticipates that it will conduct a
search for a new Chief Executive Officer in the coming weeks.
Mr. Whitfield joined the Company in March of 2007 as Division Vice President, Internal Audit
and Process. He was promoted to Vice President, Financial Planning, Analysis and Internal Audit in
June of 2008. In September of 2008, he was appointed Vice President and Interim Chief Financial
Officer and in October of 2008, he was promoted to Senior Vice President and Chief Financial
Officer. From October 2003 to June 2004, he served as a consultant for Worldcom, Inc. From June to
September 2004, he served as Senior Director of Procurement for Inphonic, Inc., then from
September 2004 until May 2005, he served as Vice President of Fulfillment and from May 2005 until
July 2006, he served as Sr. Vice President of Operations. From August 2006 until March 2007, he
served as a Financial Consultant for GTSI.
Ms. Gillespie joined GTSI as Vice President and General Manager for Professional Services and
Business Capture in October 2009 and was promoted to Senior Vice President, with all revenue and
sales operations added to her portfolio in April 2010. Ms. Gillespie held various executive
leadership positions at Raytheon, Lockheed Martin and DynCorp, where she was responsible for
leading change, identifying opportunities, building organizations and delivering results in the
information technology, logistics, mission system integration and professional services industry.
Before joining GTSI, Ms. Gillespie held the title of Vice President & General Manger Mission
Systems and Homeland Security Solutions at Raytheon Technical Services from October 2008 until
October 2009. Prior to this position she served as the Vice President of Product Support Solutions
for Raytheon from June 2007 as well as ultimately the Vice President Enterprise and Applications
Solutions Information and Knowledge Solutions with Lockheed Martin joining in June 2001. Ms.
Gillespie holds a BS in computer science as well as a Master of Business Administration from
Jacksonville State University, Jacksonville, AL.
Ms. Gillespie has no familial relationship with any director, executive officer, or person
nominated or chosen by GTSI to become a director or executive officer. In addition, there are no
known related party transactions involving Ms. Gillespie and GTSI, or any other related party.
Item 9.01
Financial Statements and Exhibits.
(d) Exhibits.
10.1 | Administrative Agreement between GTSI and the SBA dated as of October 19, 2010* |
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10.2 | Amended and Restated Credit Agreement dated as of October 19, 2010 among GTSI Corp., Castle
Pines Capital LLC and Wells Fargo Capital Finance, LLC* |
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10.3 | Separation Agreement and General Release between GTSI and Scott Friedlander dated as of
October 26, 2010 |
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10.4 | Separation Agreement and General Release between GTSI and Charles DeLeon dated as of October
26, 2010 |
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99.1 | Press release dated October 19, 2010* |
* | Previously filed as an exhibit to GTSIs Form 8-K filed with the SEC on October 25, 2010. |
SIGNATURES
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 thereunto duly authorized.
GTSI Corp. |
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By: | /s/ Peter Whitfield | |||
Peter Whitfield, | ||||
Acting Co-CEO, Sr. Vice President & CFO |
Date: October 29, 2010