UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of the Securities Exchange Act of 1934
(Amendment No. __ )
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Preliminary Information Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14c-5(d)(2))
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Definitive Information Statement
ENERGY COMPOSITES CORPORATION
(Name of Registrant as Specified In Its Charter)
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Form, Schedule or Registration Statement No.:______________________
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4400 Commerce Drive
Wisconsin Rapids, Wisconsin 54494
NOTICE OF 2010 ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of Energy Composites Corporation:
We cordially invite you to the 2010 Annual Meeting of Stockholders (“Annual Meeting”) of Energy Composites Corporation (“we,” “us,” or “our”). The meeting is at 10:00 a.m., Central Daylight Saving Time, on Tuesday, June 1, 2010, at the Hotel Mead & Conference Center located at 451 East Grand Avenue, Wisconsin Rapids, Wisconsin 54495.
At the Annual Meeting, you will be asked to vote on the following matters:
(1)
The election of the Board of Directors consisting of seven Directors to serve for one year and until the election and qualification of their successors;
(2)
Ratification of the appointment of Moquist Thorvilson Kaufmann Kennedy & Pieper LLC as our independent registered public accounting firm for 2010; and
(3)
Transaction of such other matters as may properly come before the Annual Meeting or any adjournments and postponements thereof.
Common stockholders of record at the close of business on April 2, 2010 are entitled to notice of, and to vote at, the Annual Meeting.
By Order of the Board of Directors,
/s/ Samuel W. Fairchild
Samuel W. Fairchild
Chief Executive Officer and Director
April 30, 2010
This Notice of 2010 Annual Meeting and the attached Information Statement dated April 30, 2010 should be read in combination with ECC’s annual report on Form 10-K for the fiscal year ended December 31, 2009. Collectively, these documents contain all of the information and disclosures required in connection with the 2010 Annual Meeting of Stockholders. Copies of all these materials can be found in http://energycomposites.investorroom.com.
4400 Commerce Drive
Wisconsin Rapids, Wisconsin 54494
INFORMATION STATEMENT
For the Annual Meeting of Stockholders to be held on
Tuesday, June 1, 2010, at 10:00 a.m., Central Daylight Saving Time,
at 451 East Grand Avenue, Wisconsin Rapids, Wisconsin 54495
WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US A PROXY
INTRODUCTION
This Information Statement is being furnished to the stockholders of Energy Composites Corporation, a Nevada corporation (“we,” “us,” “our,” or the “Company”) regarding our resolutions to elect directors for the coming year and to retain Moquist Thorvilson Kaufmann Kennedy & Pieper LLC as our independent registered public accounting firm for the coming year. These resolutions have been adopted by our Board of Directors in accordance with statutes governing Nevada corporations (the “Nevada Law”) and will be presented to an annual meeting of our stockholders to be held on June 1, 2010, as outlined in the Notice of 2010 Annual Meeting of Stockholders (the “Annual Meeting”) that accompanies this Information Statement.
The Company’s majority stockholders who own in excess of 55.4% of our outstanding voting securities (the “Majority Stockholders”), Jamie and Jennifer Mancl, who are officers and directors of the Company, have indicated that they will vote in favor of these resolutions. No other votes were required or necessary to elect directors for the coming year or to retain Moquist Thorvilson Kaufmann Kennedy & Pieper LLC as our independent registered public accounting firm for the coming year, and none are being solicited hereunder.
Important Notice of Internet Availability of Information Statement and Related Materials
As permitted by the federal securities laws, we are making this Information Statement and Annual Report on Form 10-K for the year ended December 31, 2009 available to our stockholders primarily via the Internet instead of mailing printed copies of these materials to each stockholder. On or about May 3, 2010, we intend to mail to our stockholders (other than those who previously requested electronic or paper delivery) a Notice of Internet Availability, or “Notice,” containing instructions on how to access these materials, including the Information Statement and Annual Report on Form 10-K for the year ended December 31, 2009. We intend to make this Information Statement available to our stockholders on or about May 3, 2010. This Information Statement and Annual Report on Form 10-K for the year ended December 31, 2009 are available for viewing on the Internet at: http://energycomposites.investorroom.com.
If you received a Notice by mail, you will not receive a printed copy of the Annual Meeting materials by mail unless you request printed materials. If you wish to receive printed materials, you should follow the instructions for requesting such materials contained in the Notice.
The election of directors and retention of Moquist Thorvilson Kaufmann Kennedy & Pieper LLC, as our independent registered public accounting firm are outlined below.
QUORUM AND VOTING REQUIREMENTS
Quorum Requirement
A majority of the voting power that is present, in person or by proxy, regardless of whether the proxy has authority to vote on all matters, shall constitute a quorum at a meeting of stockholders. If less than a quorum is represented at a meeting, a majority of the shares so represented may adjourn the meeting without further notice for a period not to exceed 60 days at any one adjournment. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. The stockholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of stockholders so that less than a quorum remains.
Vote Required
If a quorum is present, action by the stockholders on a matter other than the election of directors is approved if the number of votes cast in favor of the action exceeds the number of votes cast in opposition to the action. Each outstanding share, regardless of class, shall be entitled to one vote, and each fractional share shall be entitled to a corresponding fractional vote on each matter submitted to a vote at a meeting of stockholders, except as may be otherwise provided in the Articles of Incorporation or in the resolution providing for the issuance of the stock adopted by the Board of Directors pursuant to authority expressly vested in it by the provisions of the Articles of Incorporation. Cumulative voting shall not be allowed.
Directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. In determining the number of votes cast for or against a proposal, shares abstaining from voting on a matter (including elections) will not be treated as a vote for or against the proposal. A non-vote by a broker will be treated as if the broker never voted, but a non-vote by a stockholder will be counted as a vote “for” the management’s position.
BENEFICIAL OWNERSHIP
AND OTHER MATTERS
Record Date
The record date for determining the stockholders entitled to vote at the Annual Meeting was the close of business on April 2, 2010 (the “Record Date”), at which time we had issued and outstanding 42,132,486 shares of common stock, $0.001 par value (the “Common Stock”). The shares of Common Stock constitute the only outstanding voting securities of the Company entitled to be voted at the Annual Meeting.
Beneficial Ownership
The following table sets forth certain information regarding beneficial ownership of our common stock on April 2, 2010 by each person who is known by us to own beneficially more than 5% of the outstanding shares of common stock and our current directors and executive officers.
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Name and Address of Beneficial Owners (1)
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Amount and Nature of
Beneficial Ownership
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Percent of Class for Vote (2)
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Jennifer Lynn Mancl
4400 Commerce Drive
Wisconsin Rapids, Wisconsin 54494
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23,326,917 (3)
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55.4%
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Jamie Lee Mancl
4400 Commerce Drive
Wisconsin Rapids, Wisconsin 54494
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23,323,592 (3)
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55.4%
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Thomas J. Klismith
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487,877 (4)
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1.2%
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Samuel W. Fairchild
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337,596 (5)
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0.8%
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Daniel P. Wergin
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234,279 (6)
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0.6%
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James F. Miller
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90,000 (6)
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0.2%
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Name and Address of Beneficial Owners (1)
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Amount and Nature of
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Jeffrey S. Keuntjes
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52,500 (7)
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0.1%
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Kenneth A. Iwinski
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24,272
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0.1%
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Officers and directors as a group (7 persons)
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24,553,441 (8)
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57.8%
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(1)
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To our knowledge, except as set forth in the footnotes to this table and subject to applicable community property laws, it is anticipated that each person named in the table will have sole voting and investment power with respect to the shares set forth opposite such person’s name.
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(2)
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Based on 42,132,486 shares of common stock outstanding as of April 2, 2010.
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(3)
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Jamie Lee Mancl and Jennifer Lynn Mancl are married and share the voting and investment power associated with the 22,800,000 shares of common stock in their names and 523,592 shares owned of record by the Mancls as trustees of the Jamie L. and Jennifer L. Mancl Revocable Trust u/a/d January 24, 2007. In addition, Jennifer Mancl owns 3,325 shares of common stock.
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(4)
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Includes 153,181 shares of common stock held by Jay-Mar Road Professional Court LLC, 40,310 shares of common stock held by F&R Property, LLC, and 240,000 shares of common stock issuable upon exercise of warrants.
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Includes 40,000 shares of common stock held by Mr. Fairchild’s spouse and minor children and 33,400 shares of common stock issuable upon exercise of warrants.
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(6)
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Includes 40,000 shares of common stock issuable upon exercise of warrants.
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(7)
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Includes 10,000 shares of common stock issuable upon exercise of warrants.
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(8)
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Includes 363,400 shares of common stock issuable upon exercise of warrants.
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Changes in Control
There are no agreements known to management that may result in a change of control of the Company.
Interests of Directors and Officers in Matters to be Acted Upon
Other than the election of the nominated directors, no director or officer, or associate of any director or officer or any other person will receive extra or special benefit from the matters described herein which is not shared on a pro rata basis by all other holders of securities of the same class in accordance with their respective interests.
ITEM 1. ELECTION OF DIRECTORS
The first item to be acted upon at the Annual Meeting is the election of seven directors to our Board of Directors. Each of the persons elected will serve a term of one year and until the election and qualification of his or her successor. We are not aware of any material proceedings to which any of the nominee directors, or any associate of any such director, is a party adverse to us or has a material interest adverse to us or to any of our subsidiaries. Each nominee has consented to being named as a nominee and to serve if elected.
Director candidates were nominated by the Board of Directors. To date, it has not been necessary to engage a third party search firm to assist in identifying suitable candidates for directors. The Board of Directors believes that our existing Board members and executive management have sufficient networks of business contacts to form a suitable candidate pool from which nominees may be identified in the future.
If any Director nominee named in this information statement shall become unable or decline to serve (an event which the Board does not anticipate), a substitute may be nominated and elected.
Nominees for Director to be Elected
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Name
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Age
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Current Position with Company
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Samuel W. Fairchild
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55
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Chief Executive Officer and Director
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Jamie Lee Mancl
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37
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President and Director
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Jennifer Lynn Mancl
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35
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Vice President and Director
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Daniel P. Wergin
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68
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Director
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Thomas J. Klismith
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51
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Director
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James F. Miller
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54
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Director
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Timothy Sherlock
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57
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Director
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The nominees for election as directors have provided the following information about themselves:
Samuel W. Fairchild.
Mr. Fairchild has served as our director and Chief Executive Officer since October 2008. Mr. Fairchild has served as a director of Advanced Fiberglass Technologies, Inc. (“AFT”) since April 2008. Previously, he served as Chief Executive Officer and Director of Tower Tech Holdings (TWRT), the predecessor to Broadwind Energy (BWEN), from 2006 – 2007, where he led the growth in market capitalization from $40 million to nearly $1 billion through process restructuring, market repositioning, capital formation and responsive corporate governance. Mr. Fairchild has been the President of the Tadpole Group, an investment portfolio-holding company focused on harvesting value from transformation, since August 2004. He has also been Managing Director of Theseus Capital Partners, an investment advisory firm, since August 2004. Prior to founding Theseus in 2004, Mr. Fairchild co-led the Global Government, Transport & Infrastructure Group of PA Consulting Group, a role he assumed in 1999 as a result of PA’s acquisition of GKMG Consulting Services, a strategic consulting firm he founded in 1992. During that period, he also served as “shadow CEO” of Air New Zealand following the demise of its wholly-owned subsidiary, Ansett Airlines, where he led the Crown’s acquisition of most of the outstanding shares and the comprehensive turnaround of the airline. He has also served in the White House as senior advisor to President Reagan and Vice President Bush for transportation policy, and was George Bush’s Acting Assistant Secretary of Transportation for Policy and International Affairs. Following his government service, Mr. Fairchild was a member of the management group at the Carlyle Group, where he helped to establish BDM International’s transportation group before BDM was sold to TRW, Inc. Since May 1996, Mr. Fairchild has been the Chairman of the Board of Schiphol North America, the owner of JFK’s $1.4 billion Terminal Four and the international arm of Amsterdam Airport’s Schiphol Group. Mr. Fairchild brings to the Board substantial insight around growing a small manufacturing company, building an effective management team, implementing strong corporate governance, complying with regulatory requirements, and diversifying the Company’s business strategy to include the wind energy market.
Jamie Lee Mancl.
Mr. Mancl has served as our President and as a director since October 2008. Mr. Mancl has served as President and a director of AFT since its inception in January 2005. From 1995 to January 2005, he operated M&W Fiberglass, LLC (“M&W”), the predecessor company to AFT. Mr. Mancl is the sole owner of M&W. He is also the owner of Fiberglass Piping & Fitting Company (“FPF”), a firm he founded in 2006 which he continues operate. Mr. Mancl has an extensive background managing success in the composites industry. From 1989 to 1995, he served in various management positions at Industrial Fiberglass. Mr. Mancl has a successful track record managing the day-to-day operations of a growing composites fabricator, and is an industry-recognized expert in composites. Mr. Mancl brings to the Board extensive experience in the composites industry as well as broad insight into the Company’s legacy markets and production activities.
Jennifer Lynn Mancl.
Mrs. Mancl has been our Vice President and a director since October 2008. Mrs. Mancl has served as Vice President of AFT since its inception in January 2005 and as a director since April 2008, where she has been responsible for all administrative processes, marketing and external affairs. From 1998 to 2003, Mrs. Mancl worked for Stora Enso North Amerca, where she gained plant floor experience in the pulp and paper industry as well as considerable experience in purchasing and negotiations. In 2002, Mrs. Mancl earned a B.A. degree in Business Administration and Marketing from Lakeland College in Wisconsin. Mrs. Mancl provides the Board with substantial insight into the composites industry supply chain as well as a deep understanding of the Company’s administrative systems.
Daniel P. Wergin
. Mr. Wergin has served as our director since October 2008. He has also served as a director of AFT since April 2008, following his resignation from the Board of Broadwind Energy (BWEN). Mr. Wergin was a founder of Broadwind’s predecessor company, Tower Tech Holdings (TWRT), and that company’s first Chief Financial Officer. He has also been the President of Choice, Inc., a real estate investment and development company based in Manitowoc, Wisconsin, since 1970. Mr. Wergin has specialized in real estate development, leasing, and Internal Revenue Code §1031 exchanges. He has been a member of the National Association of Realtors and its Certified Commercial Investment Division since 1975. Mr. Wergin brings to the Board an extensive track record in growing and financing industrial business, complying with local and federal regulatory requirements as well as developing new facilities.
Thomas J. Klismith
. Mr. Klismith has served as our director since October 2008. He has also served as a director of AFT since April 2008. Mr. Klismith has been a Certified Public Accountant since 1984 and in 1988 he founded Klismith Accounting & Tax Group, which provides accounting, tax planning, software consulting and financial advisory services to individuals and businesses in central Wisconsin. Mr. Klismith has significant experience in tax planning and preparation, financial reporting, business budgeting and forecasting, financial, estate and retirement planning and business consulting. Mr. Klismith is a member of both the American and Wisconsin Institutes of Certified Public Accountants. Mr. Klismith provides the Board with strong accounting and executive compensation insights as well as a broad understanding of the local economy.
James F. Miller
. Mr. Miller has served as our director since September 2009. Since January 2005, Mr. Miller has been and is currently President and a member of the Board of Intervistas Consulting, LLC (formerly Innova Aviation Consulting, LLC), an international management consulting and transaction advisory firm with offices in the United States, Canada and the Netherlands. Prior to joining Intervistas, Mr. Miller was a Senior Partner and Member of the Management Committee of the PA Consulting Group from October 2000 to December 2004, an international management consulting firm based in London. Prior to joining PA, Mr. Miller was a Senior Vice President and Executive Officer of Hager Bailly (HBIX), Manager of Marketing and International Affairs for the Metropolitan Washington Airports Authority, Investment Principal at Minshall & Co., President of Aviation Advisors Inc., and he served in various positions with the City of Tulsa, Tulsa Airports Trust including Deputy Director of Aviation and Chief Financial Officer. Mr. Miller has served on the Board of the JFKIAT, LLC, the developer of a $1.2 billion redevelopment of T4 at JFK International Airport. Mr. Miller is a principal and Board member of Tadpole Group, LLC and manages its various investments in intellectual property and new emerging technologies. In addition, Mr. Miller serves on the board of directors of IPBB, Inc., an intellectual property company based in Canada. Mr. Miller has been the lead advisor to Amsterdam Airport Schiphol, American Express and T-Mobile. Mr. Miller received his Juris Doctorate from the University of Tulsa in 1983, his Masters in Economics from West Virginia University in 1979, and his Bachelors degree in Economics from West Virginia University in 1978. Mr. Miller brings to the Board extensive experience in financing business growth, developing financial management strategies, and participating in effective corporate governance.
Timothy Sherlock
. Mr. Sherlock has served as our director since September 2009. He has significant experience
implementing planning, accounting, and internal controls for public and private entrepreneurial growth-oriented technology companies. Since February 2009, Mr. Sherlock has served and continues to serve as Chief Financial Officer of GeoAnalytics, Inc., a provider of spatial analytics solutions in Madison, Wisconsin. From September 2007 to January 2009, he held the CFO position at On-Course Learning. From April 2001 to September 2007, Mr. Sherlock held various positions with ARI Network Services Inc., including CFO, Treasurer, and Vice President of Operations. Prior to 2001, Mr. Sherlock served as CFO for Catalyst International Inc. and Renaissance Learning, Inc. Mr. Sherlock has been a Certified Public Accountant since 1986. He graduated from the University of St. Thomas with a Bachelors degree in Business in 1980. Mr. Sherlock is a member of both the American Institute of Certified Public Accountants and of Financial Executives International. Mr. Sherlock provides the board with deep insights on financial management, regulatory compliance and public company audit responsibilities.
Jamie Lee Mancl is married to Jennifer Lynn Mancl. Other than the Mancls, there are no family relationships between any of our nominee directors. During the last five years, none of the nominee directors has (i) had any bankruptcy petition filed by or against any business of which such person was an officer; (ii) had any conviction in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (iii) been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court, permanently or temporarily enjoining, barring, suspending or otherwise limiting his or her
involvement in any type of business, securities or banking activities; or (iv) been found by a court of competent jurisdiction (in a civil action), the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law.
Board of Directors’ Responsibilities and Committees
Samuel W. Fairchild, our Chief Executive Officer, functions as the de facto chairman of the board. We believe that this leadership structure is appropriate, as we have a President, Jamie Lee Mancl, who functions as the chief operating officer of Advanced Fiberglass Technologies, Inc. (to be known as ECC Corrosion, Inc.), our primary operating subsidiary.
The Board of Directors’ primary responsibility is to seek to maximize long-term stockholder value. The Board of Directors selects our management, monitors management and Company performance, and provides advice and counsel to management. Among other things, the Board of Directors regularly reviews our business strategy and approves our budget. In fulfilling the Board of Directors’ responsibilities, non-employee directors have full access to our management, external auditors and outside advisers.
Our Board of Directors established an audit committee and a joint compensation and nominating committee in October 2009. Members of the audit committee are James F. Miller and Timothy Sherlock. Mr. Miller serves as audit committee chair. We have determined that Mr. Sherlock is our audit committee financial expert and is independent. The audit committee held two meetings in 2009.
Members of the joint compensation and nominating committee are Thomas J. Klismith and Daniel P. Wergin. Mr. Klismith serves as compensation and nominating committee chair. The joint compensation and nominating committee held one meeting in 2009. While a compensation committee charter has been adopted, a nominating committee charter has not yet been adopted.
The nominating committee has not yet developed its process for identifying and evaluating nominees for director or a policy with regard to the consideration of any director candidates recommended by stockholders. It will likely formulate a process and policy when it adopts a charter for the committee. The procedure for the nomination of directors by stockholders is described in this Information Statement under the heading “Additional Information – Stockholder Nominations of Directors.” All of the nominees named in this Information Statement are standing for re-election.
The Board committee charters are available on the Company’s web site: www.energycompositescorp.com.
Board Meetings and Annual Meeting Attendance
Since completing the acquisition of AFT, our Board of Directors typically meets at least once per month for regularly scheduled meetings, and special meetings are scheduled when required. The Board of Directors held 22 meetings in 2009. None of our directors attended fewer than 75% of the meetings of the Board and the committees of the Board on which he or she served. The Board of Directors has adopted a policy that all directors must attend at least 80% of all regularly scheduled Board of Directors’ meetings and at least 70% of all special Board of Directors’ meetings. Although we have no formal policy relating to directors’ attendance at the Annual Meeting, we encourage all our directors to attend the Annual Meeting and reimburse expenses associated with attendance.
Director Compensation
We adopted a director compensation package for 2009, pursuant to which each director receives an annual $30,000 restricted stock grant per year and $500 cash for each regularly scheduled in-person board meeting, special meeting and committee meeting attended. We also reimburse our directors for actual reasonable expenses incurred in attending each meeting. In addition, each chairperson of a committee receives a $15,000 restricted stock grant per year. All restricted stock will be paid to the directors in arrears for the previous year of service.
The following table sets forth information regarding the 2009 remuneration of our directors whose compensation does not appear elsewhere in this information statement. The compensation of our other directors is disclosed in the Summary Compensation Table under the heading “Executive Compensation.”
Director Compensation Table
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Name
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Fees Earned or Paid in Cash
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Stock Awards
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Option Awards
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All Other Compensation
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Total
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($)
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($)
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($)
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($)
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($)
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Jennifer Lynn Mancl
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41,500 (1)
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12,500 (2)
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-
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1,154 (1)
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54,654
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Daniel P. Wergin
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500
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12,500 (2)
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-
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-
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13,000
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Thomas J. Klismith
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2,000
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12,500 (2)
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-
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- (3)
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13,500
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James F. Miller
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500
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-
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-
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-
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-
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Timothy Sherlock
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500
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-
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-
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-
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-
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_________________
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(1)
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Jennifer Mancl serves as our Vice President and received $40,500 compensation in that capacity. Other compensation for Mrs. Mancl during 2009 consisted of $1,154 in 401(k) contributions.
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(2)
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Jennifer Mancl, Daniel P. Wergin and Thomas J. Klismith were each issued 3,325 restricted shares of common stock as compensation for services rendered during the period from January 1, 2009 through May 31, 2009.
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(3)
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Other compensation excludes $5,680 paid to Mr. Klismith’s firm, Klismith Accounting and Tax Group, for accounting and business consulting services rendered to our Company.
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Conflicts of Interest and Related Party Transactions
Our officers and directors are now and may in the future become stockholders, officers or directors of other companies that may be engaged in business activities similar to those conducted by us. Accordingly, direct conflicts of interest may arise in the future with respect to such individuals acting on our behalf or other entities. Moreover, additional conflicts of interest may arise with respect to opportunities which come to the attention of such individuals in the performance of their duties or otherwise. Although we do not currently have a right of first refusal pertaining to opportunities that come to management’s attention insofar as such opportunities may relate to our business operations, we have established a conflict of interest policy intended to ensure timely disclosure and avoidance of activities and relationships that conflict with the interests of the Company.
Our officers and directors are subject to the restriction that all opportunities contemplated by our business plan which come to their attention, either in the performance of their duties or in any other manner, will be considered opportunities of, and be made available to our Company. A breach of this requirement will be a breach of the fiduciary duties of the officer or director.
All future affiliated transactions will be made or entered into on terms that are no less favorable to us than those that can be obtained from any unaffiliated third party. A majority of the independent, disinterested members of our board of directors will approve future affiliated transactions.
Jamie L. and Jennifer L. Mancl.
Mr. Mancl owns 100% of M&W, which owned and leased our manufacturing plant to us in 2008. On December 31, 2008, we exercised our option to purchase the manufacturing facility we were leasing from M&W for a purchase price of $4,500,000. The purchase price for the facility was paid in the form of: (i) an assumption of the industrial revenue bonds and note related to the building and land; (ii) cash at closing in the amount of $500,000; and (iii) the balance ($1,045,328) in the form of a promissory note bearing interest at an annual fixed rate of 4.775% which was determined using the twelve-month LIBOR as of December 31, 2008 (2.025%) plus 2.75%, payable in quarterly installments of principal and interest amortized over not more than 15 years with the unpaid principal balance due not later than December 15, 2015. The assumed debt consisted of all obligations of M&W under the bond agreement and promissory notes related to the plant and its equipment. As of December 31, 2008, the amount of the assumed debt of the industrial revenue bonds was $2,879,672. For the year ended December 31, 2009, we paid interest expense to M&W on the building promissory note of $48,984.
In addition to the $4,500,000 purchase price paid on December 31, 2008, we paid total rent to M&W of $420,000 during 2008 pursuant to the lease of the manufacturing plant. After deductions for depreciation, interest and other expenses, M&W’s net profit from the lease during 2008 was $160,455.
Mr. Mancl also owns 100% of FPF, which is a distributor of imported fiberglass piping and fitting products. We purchase products from FPF from time to time for use in the manufacture of our products. During 2009 and 2008, we purchased products from FPF totaling $393,117 and $150,605 respectively. As of December 31, 2009 and 2008, we had an accounts payable balance of $188,356 and $89,372, respectively, owed to FPF. Our board of directors has reviewed the related party transactions with FPF and determined it is in its best interest to continue to purchase products from FPF given their high quality, the limited availability of such products from other suppliers at a competitive price and the costs to produce or import comparable products. On October 13, 2008, AFT entered into a Purchase and Supply Agreement with FPF pursuant to which AFT may purchase fiberglass piping and fitting products at FPF’s net direct cost. The Purchase and Supply Agreement was filed as an exhibit to our Current Report on Form 8-K filed October 17, 2008.
M&W Fiberglass, LLC.
Prior to the acquisition of the manufacturing facility on December 31, 2008, we were co-borrowers with M&W, Jamie Mancl and Jennifer Mancl under a Bond Agreement with the City of Wisconsin Rapids and Nekoosa Port Edwards State Bank (“Bank”) pursuant to which tax-exempt industrial revenue bonds in the amount of $4,000,000 were issued by the City (“IRB Debt”), $3,000,000 of which was used for the purpose of financing the construction of the manufacturing facility owned by M&W and leased to us and $1,000,000 of which was used for the purpose of financing the acquisition of equipment owned by us and installed at the facility. As part of the purchase of the manufacturing facility, we executed an assignment and assumption agreement whereby M&W and the Mancls are no longer obligated under the IRB Debt.
Fiberglass Piping & Fitting Company.
During 2008, FPF operated its business out of the same manufacturing facility that we leased from M&W (and now own). FPF occupied approximately 1,000 square feet of the facility on a rent free basis. The value of the space provided during 2008 based on the rental payments made by us to M&W was approximately $4,800. As of November 1, 2008, FPF has moved its operations to an offsite location.
During 2008, FPF obtained debt financing from the Bank to buy inventory that was secured, in part, by AFT guarantees and assets. As of October 9, 2008, AFT has been released by the Bank as guarantor and its assets no longer serve as collateral for FPF’s debts.
Klismith Accounting and Tax Group.
Thomas J. Klismith has provided tax, accounting, and business consulting services to us for several years. The following table sets forth payments made and amounts owed to Mr. Klismith’s firm during the years ended and as of December 31, 2009 and 2008:
|
|
|
December 31,
|
|
|
|
|
2009
|
|
|
2008
|
|
|
Payments made
|
|
$
|
5,680
|
|
|
$
|
45,795
|
|
|
Amounts owed
|
|
$
|
0
|
|
|
$
|
4,940
|
|
Convertible Debentures and Warrants.
During 2008, we conducted a private offering of units consisting of (i) a 3-year, 6% convertible debenture with a conversion price of $2.50 per share, and (ii) a number of warrants exercisable into shares of the Company’s common stock equal to the number of shares issuable upon conversion of the principal amount of the Debentures. Each Warrant is exercisable into shares of common stock for a term of 3 years at $5.00 per share. Samuel W. Fairchild, Thomas J. Klismith, Daniel P. Wergin, and Jeffrey S. Keuntjes all participated in our private placement of debentures and warrants. The following table details the participation in the private placement by these individuals:
|
Name
|
Debentures Purchased
|
Warrants Purchased
|
|
Samuel W. Fairchild (1)
|
$1,825,000
|
730,000
|
|
Thomas J. Klismith (2)
|
$600,000
|
240,000
|
|
Daniel P. Wergin
|
$100,000
|
40,000
|
|
James F. Miller (1)
|
$100,000
|
40,000
|
|
Jeffrey S. Keuntjes
|
$25,000
|
10,000
|
______________
|
(1)
|
All of the purchases were made through ECC Investment Partners LLC, a company controlled by Mr. Fairchild.
|
|
(2)
|
$375,000 was purchased by Jay-Mar Road Professional Court LLC, $100,000 was purchased by F&R Property, LLC, and $125,000 was purchased directly by Mr. Klismith. Mr. Klismith controls both Jay-Mar Road Professional Court LLC and F&R Property, LLC.
|
All of these officers and directors have converted their Debentures into shares of our common stock.
Director Independence
The Board of Directors has determined that the following members of the Board are independent directors as that term is defined by NASDAQ Marketplace Rule 5605(a)(2): Daniel P. Wergin, Thomas J. Klismith, James F. Miller and Timothy Sherlock. In assessing the independence of the directors, the Board considers any transactions, relationships and arrangements between our Company and our independent directors or their affiliated companies. This review is based primarily on responses of the directors to questions in a director and officer questionnaire regarding employment, business, familial, compensation and other relationships with our Company or our management. In reviewing Mr. Klismith’s independence, the Board of Directors considered services rendered to our Company by Mr. Klismith’s accounting firm, as described further under “Conflicts of Interest and Related Party Transactions” herein. There were no other transactions, relationships or arrangements between our Company and any of the independent directors or the independent directors’ affiliated companies that came to the attention of the Board during our review of the independence of directors that warranted additional review.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), requires our executive officers and directors to file with the Securities and Exchange Commission (“SEC”) initial reports of ownership and reports of changes in ownership of our common stock. Executive officers and directors are required to furnish us with copies of all Section 16(a) reports they file. Based solely on a review of the copies of such forms furnished to us, we believe that our executive officers and directors complied with all Section 16(a) filing requirements applicable to them during 2009, except for the following:
|
Reporting Person
|
Date Report Due
|
Date Report Filed
|
|
Samuel W. Fairchild
|
07/30/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
07/31/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
08/03/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
08/12/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
08/19/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
08/20/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
08/21/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
08/28/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
09/03/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
09/11/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
09/14/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
09/16/2009
|
11/17/2009
|
|
Samuel W. Fairchild
|
09/24/2009
|
11/17/2009
|
|
Jeffrey S. Keuntjes
|
04/07/2009
|
07/21/2009
|
|
Jeffrey S. Keuntjes
|
07/08/2009
|
07/21/2009
|
Director Indemnification
Under the corporate laws of the State of Nevada and our Articles of Incorporation, we have broad powers to indemnify our directors and officers against liabilities they may incur in such capacities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Our Bylaws also provide for mandatory indemnification of our directors and executive officers, and permissive indemnification of our employees and agents, to the fullest extent permissible under Nevada law. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling our Company pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
Stockholder Communications
Stockholders who wish to communicate directly with our Board of Directors should write to:
Energy Composites Corporation
4400 Commerce Drive,
Wisconsin Rapids, Wisconsin 54494
Attention: Board of Directors
Executive Officers
Information relating to our non-director executive officers is as follows:
|
Name
|
Age
|
Current Position with Company
|
|
Jeffrey S. Keuntjes
|
45
|
Vice President - Finance
|
|
Kenneth A. Iwinski
|
47
|
General Counsel and Secretary
|
The executive officers have provided the following information about themselves:
Jeffrey S. Keuntjes– Vice President - Finance.
Mr. Keuntjes has served as our Vice President - Finance since January 2009, and has been our Controller since October 2008. He has also served as the Chief Financial Officer of AFT since January 2009 and the Controller of AFT since June 2007. From 2001 to June 2007, he served as a Senior Business Analyst for Domtar Industries, a pulp and paper manufacturer in Wisconsin. Mr. Keuntjes’ background includes over 20 years of broad-based financial management experience with publicly-traded and privately-held companies including Domtar Industries, Renaissance Learning, Inland Steel and Trane Company. Mr. Keuntjes is a member of the Institute of Management Accountants, has earned CSOX certification from the Sarbanes-Oxley Institute and holds BA and MBA degrees from the University of Wisconsin, Madison.
Kenneth A. Iwinski – General Counsel and Secretary.
Mr. Iwinski has served as our General Counsel and Secretary since October 2008 and has been General Counsel and Secretary of AFT since April 2008. From May 2007 until April 2008, Mr. Iwinski was involved in the private practice of law. From September 2006 to May 2007, he served as Managing Member and Counsel for Sun Prairie Solutions Group, LLC, an early stage aseptic manufacturing business focused on providing national production and distribution of functional beverages through a joint venture with a global branded food company. From 1998 to September 2006, Mr. Iwinski served as Vice President - Legal and Secretary for Northland Cranberries, Inc., a publicly traded and vertically integrated food production, processing and sales business. From 1992 until he joined Northland, Mr. Iwinski was an attorney with the business law firm of Meissner Tierney Fisher & Nichols, S.C., in Milwaukee, Wisconsin. In addition to his comprehensive business law experience, Mr. Iwinski has significant experience in human resources, corporate governance, compliance and risk management.
The term of office of each officer ends at the next annual meeting of our board of directors, expected to take place immediately after the next annual meeting of stockholders, or when such officer’s successor is elected and qualified. The Board of Directors expects that it will elect the current officers (including those also currently serving as directors) to return to their positions as officers of our Company until the next annual meeting of stockholders.
We are not aware of any material proceedings to which any of the non-director executive officers, or any associate of any such officer, is a party adverse to us or has a material interest adverse to us or to any of our subsidiaries. There are no family relationships between any of our non-director executive officers. During the last five years, none of the non-director officers has (i) had any bankruptcy petition filed by or against any business of which such person was an officer; (ii) had any conviction in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (iii) been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or (iv) been found by a court of competent jurisdiction (in a civil action), the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law.
Executive Compensation
The following table sets forth information regarding the remuneration of our chief executive officer and our executive officers that earned in excess of $100,000 per annum during any part of the last two completed fiscal years:
Summary Compensation Table
|
Name and Principal Position
|
Fiscal Year
|
Salary
($)
|
Bonus
($)
|
Option Awards
($)
|
All Other Compensation
($)
|
Total
($)
|
|
Samuel Fairchild,
Chief Executive Officer and Director
|
2009
|
-
|
-
|
-
|
-
|
-
|
|
2008
|
-
|
-
|
-
|
-
|
-
|
|
Jamie Mancl,
President and Director
|
2009
|
97,376
|
-
|
-
|
11,609 (1)
|
108,985
|
|
2008
|
89,945
|
-
|
-
|
11,387 (2)
|
101,332
|
|
Jeffrey Keuntjes,
Vice President, Finance
|
2009
|
118,307
|
-
|
75,000 (3)
|
6,397 (4)
|
199,704
|
|
2008
|
74,837
|
462
|
-
|
5,534 (5)
|
80,833
|
|
Kenneth Iwinski,
General Counsel and Secretary
|
2009
|
100,000
|
-
|
75,000 (6)
|
11,685 (7)
|
186,685
|
|
2008
|
65,385
|
-
|
-
|
3,909 (8)
|
69,294
|
________________
|
(1)
|
Other compensation for Mr. Mancl during 2009 includes: (i) $8,300 paid for health insurance; (ii) $500 health savings account contribution; and (iii) 401(k) contribution of $2,809. Other compensation for 2009 excludes $442,101, which consists of: (i) $48,984 paid to M&W Fiberglass as interest on the loan extended to AFT for the purchase of the manufacturing facility in 2008 and (ii) $393,117 paid to FPF for the sale of fiberglass piping and fitting products to our company.
|
|
(2)
|
Other compensation for Mr. Mancl during 2008 includes: (i) $8,262 paid for health insurance; (ii) $500 health savings account contribution; and (iii) $2,625 Simple IRA contribution. Other income during 2008 excludes $1,512,043 consisting of: (i) $160,455 of net profit to M&W from the lease of the manufacturing facility to our Company; (ii) $24,153 of gross profit to FPF from the sale of fiberglass piping and fitting products to our Company; (iii) $4,800 representing the value of space within our manufacturing facility which was occupied by FPF on a rent free basis during 2008; and (iv) $1,322,634 gain from the sale of manufacturing plant to AFT.
|
|
(3)
|
Mr. Keuntjes was issued 25,000 shares on March 17, 2009. The value is based on the market price on that date.
|
|
(4)
|
Other compensation for Mr. Keuntjes during 2009 includes: (i) $2,440 paid for health insurance; (ii) $500 health savings account contribution; and (iii) 401(k) contribution of $3,457.
|
|
(5)
|
Other compensation for Mr. Keuntjes during 2008 includes: (i) $2,776 paid for health insurance; (ii) $500 health savings account contribution; and (iii) $2,258 Simple IRA contribution.
|
|
(6)
|
Mr. Iwinski receives a $75,000 stock grant annually, where the number of shares is based on the average of the closing trading price on the 15
th
of each month during the preceding twelve months, and where half of shares granted vest on the anniversary date and the remaining half vests one year later. Mr. Iwinski was issued a total of 24,272 shares on April 28, 2009.
|
|
(7)
|
Other compensation for Mr. Iwinski during 2009 includes: (i) $8,300 paid for health insurance; (ii) $500 health savings account contribution; and (iii) 401(k) contribution of $2,885.
|
|
(8)
|
Other compensation for Mr. Iwinski during 2008 includes: (i) $3,701 paid for health insurance; and (ii) $208 health savings account contribution.
|
Our offer letter to Kenneth Iwinski outlines an annual base salary of $175,000, of which $100,000 is to be paid in cash and $75,000 is to be paid in restricted common stock, held in escrow with a vesting schedule of 50% at the end of the first year and 50% at the end of the second year. The number of shares in the annual stock grant is calculated by averaging the closing trading price on the 15
th
of each month during the employment year.
Outstanding Equity Awards at Fiscal Year-End
|
Name
|
Stock Awards
|
|
Number of shares or units of stock that have not vested (#)
|
Market value of shares or units of stock that have not vested ($)
|
Equity incentive plan awards: Number of unearned shares, units or other rights that have not vested (#)
|
Equity incentive plan awards: market or payout value of unearned shares, units or other rights that have not vested ($)
|
|
Samuel Fairchild
|
-
|
-
|
-
|
-
|
|
Jamie Mancl
|
-
|
-
|
-
|
-
|
|
Jeffrey Keuntjes
|
-
|
-
|
-
|
-
|
|
Kenneth Iwinski
|
12,136 (1)
|
$48,665
|
-
|
-
|
_________________
|
(1)
|
These shares vested on April 28, 2010
|
ITEM 2. RATIFICATION OF INDEPENDENT AUDITORS
The second item to be acted upon at the Annual Meeting is the ratification of the Board of Directors’ selection of our independent registered public accounting firm.
The Board of Directors has appointed Moquist Thorvilson Kaufmann Kennedy & Pieper LLC (“Moquist Thorvilson”) as our independent registered public accounting firm to examine our financial statements for the current fiscal year ending December 31, 2010 and to perform other appropriate accounting services. Moquist Thorvilson has served as our independent registered public accounting firm since October 23, 2008, and has no relationship with us other than that arising from their employment as our independent registered public accounting firm.
On October 23, 2008, we dismissed Kyle L. Tingle, CPA, LLC (“Tingle”) as our independent registered public accounting firm, effective immediately.
Tingle’s audit reports on our financial statements as of and for the years ended December 31, 2007 and 2006 did not contain any adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles, except a separate paragraph stating:
“The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has limited operations and has no established source of revenue. This raises substantial doubt about its ability to continue as a going concern. Management’s plan in regard to these matters is also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.”
In connection with Tingle’s audits for the years ended December 31, 2007 and 2006, there have been no disagreements with Tingle on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which, if not resolved to Tingle’s satisfaction, would have caused Tingle to make reference in connection with their opinion to the subject matter of the disagreement, or “reportable events” as defined in Regulation S-K, Item 304(a)(1)(v).
On October 23, 2008, we engaged Moquist Thorvilson to audit our financial statements for the year ending December 31, 2008. During the two most recent years and through the date hereof, we have not consulted with
Moquist Thorvilson regarding either (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on our financial statements, and neither a written report nor oral advice was provided to us that Moquist Thorvilson concluded was an important factor considered by us in reaching a decision as to the accounting, auditing or financial reporting issue; or (ii) any matter that was the subject of either a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K or the related instructions thereto) or a reportable event.
While we are not required to do so, we are submitting the appointment of Moquist Thorvilson to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2010 for ratification in order to ascertain the views of our stockholders on this appointment. If the appointment is not ratified, the Board of Directors will reconsider its selection.
Fees paid to Moquist Thorvilson during 2009 and 2008 were as follows:
|
|
|
2009
|
|
|
2008
|
|
|
Audit Fees (1)
|
|
$
|
86,485
|
|
|
$
|
93,680
|
|
|
Audit-Related Fees (2)
|
|
|
8,693
|
|
|
|
57,446
|
|
|
Tax Fees
|
|
|
26,900
|
|
|
|
—
|
|
|
All Other Fees
|
|
|
—
|
|
|
|
—
|
|
|
Total Fees
|
|
$
|
122,078
|
|
|
$
|
151,126
|
|
|
(1)
|
The amount billed to us for professional services related to the audit of our annual financial statements as of December 31, 2009 and 2008 and included reviews of our quarterly reports on Form 10-Q.
|
|
(2)
|
This amount was billed to us for professional services provided as follows: 2009 – primarily for Sarbanes-Oxley 404 consulting and reviewing SEC comment letters; 2008 - primarily in connection with the Definitive Information Statement on Schedule 14C we filed in connection with the reverse acquisition of AFT in September 2008.
|
The Board of Directors has considered whether the provision of the non-audit services described above by an external auditor is compatible with maintaining the auditor’s independence, and determined that these non-audit services are compatible with the required independence. The Board of Directors pre-approves all services to be provided to our Company by the independent auditors. This includes the pre-approval of (i) all audit services, and (ii) any significant (i.e., not de minimis) non-audit services. Before granting any approval, the Board of Directors gives due consideration to whether approval of the proposed service will have a detrimental impact on the auditor’s independence. All services provided by and fees paid to our independent auditors in 2009 and 2008 were pre-approved by the Board of Directors.
Representatives of Moquist Thorvilson will be present at the Annual Meeting, will have an opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions from stockholders.
REPORT OF AUDIT COMMITTEE
The audit committee reviewed and discussed the audited financial statements with management, as discussed with the independent auditors the matters required to be discussed by the statement on Auditing Standards No. 61, as amended. The audit committee received the written disclosures and the letter from the independent accountant required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountant’s communications with the audit committee concerning independence, and has discussed with the independent accountant the independent accountant’s independence. Based on the review and discussions referred to above, the audit committee recommended to the Board of Directors that the audited financial statements be included in our annual report on Form 10-K.
James F. Miller
Timothy Sherlock
ADDITIONAL INFORMATION
Stockholder Proposals
The 2011 Annual Meeting of Stockholders is scheduled to be held on June 7, 2011. Pursuant to Rule 14a-8 under the Exchange Act, stockholders may present proper proposals for inclusion in our proxy statement and for consideration at the next annual meeting of stockholders by submitting their proposals to our Company Secretary in a timely manner. In order to be included in the proxy statement for the 2011 Annual Meeting of Stockholders, stockholder proposals must be received by our Company Secretary no later than December 31, 2010, and must otherwise comply with the requirements of our Bylaws and Rule 14a-8. No such stockholder proposals have been received for the 2010 Annual Meeting of Stockholders.
If a stockholder who has notified the Company Secretary of his intention to present a proposal at an annual meeting does not appear or send a qualified representative to present his proposal at such meeting, the proposal will not be presented for a vote at such meeting.
Stockholder Nominations of Directors
If a stockholder wishes to nominate an individual as a candidate for election to the Board of Directors, the stockholder must submit a proper and timely nomination to the Company Secretary. In order to nominate a director for the 2011 Annual Meeting of Stockholders, stockholder nominations must be received by our Company Secretary no later than December 31, 2010. No such stockholder nominations have been received for the 2010 Annual Meeting of Stockholders.
A proper stockholder nomination for director must include the following information:
|
a.
|
The name, age, business address and residence address of each nominee.
|
|
b.
|
The principal occupation or employment of each nominee.
|
|
c.
|
The class and number of Company shares which are beneficially owned by each nominee on the date of such stockholder’s notice.
|
|
d.
|
Any other information relating to each nominee that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act, or any successor statute thereto (including, without limitation, each nominee’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected).
|
|
2.
|
Nominating Stockholder Information:
|
|
a.
|
The name and address, as they appear on the Company’s books, of the nominating stockholder and any other stockholders known by such stockholder to be supporting each nominee.
|
|
b.
|
The class and number of Company shares which are beneficially owned by the nominating stockholder on the date of such stockholder’s notice.
|
|
c.
|
A representation that the stockholder is a holder of record of Company stock entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice.
|
|
3.
|
Related Agreements and Understandings:
|
|
a.
|
A description of all arrangements or understandings between the nominating stockholder and each nominee and other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the nominating stockholder.
|
If a stockholder who has notified the Company Secretary of his intention to make a nomination at an annual meeting does not appear or send a qualified representative to make his nomination at such meeting, the nominee will not be included on the ballot distributed at the meeting.
Annual Report to Stockholders
Our Annual Report on Form 10-K for the year ended December 31, 2009 accompanies this information statement and is also available for viewing on the Internet at www.vfnotice.com/energycomposites. The Annual Report contains financial statements audited by Moquist Thorvilson, our independent registered public accounting firm. The Annual Report is not to be considered as having been incorporated by reference. If requested, we will provide you copies of any exhibits to the Form 10-K upon the payment of a fee covering our reasonable expenses in furnishing the exhibits. You can request exhibits to the Form 10-K by writing to our Company Secretary at Energy Composites Corporation, 4400 Commerce Drive, Wisconsin Rapids, Wisconsin 54494.
Questions
If you have any questions or need more information about the annual meeting, write to:
Energy Composites Corporation
4400 Commerce Drive,
Wisconsin Rapids, Wisconsin 54494
Attention: Company Secretary
or call us at (800) 787-5439 or (715) 421-2060.
By Order of the Board of Directors,
/s/ Samuel W. Fairchild
Samuel W. Fairchild
Chief Executive Officer and Director
April 30, 2010
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