0001162893-12-000010.txt : 20121126 0001162893-12-000010.hdr.sgml : 20121126 20121126092129 ACCESSION NUMBER: 0001162893-12-000010 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20121126 DATE AS OF CHANGE: 20121126 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: STABOSZ TIMOTHY J CENTRAL INDEX KEY: 0001162893 FILING VALUES: FORM TYPE: SC 13D/A MAIL ADDRESS: STREET 1: 1307 MONROE STREET CITY: LA PORTE STATE: IN ZIP: 46350 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: SCOTTS LIQUID GOLD INC CENTRAL INDEX KEY: 0000088000 STANDARD INDUSTRIAL CLASSIFICATION: PERFUMES, COSMETICS & OTHER TOILET PREPARATIONS [2844] IRS NUMBER: 840920811 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-10347 FILM NUMBER: 121223272 BUSINESS ADDRESS: STREET 1: 4880 HAVANA ST CITY: DENVER STATE: CO ZIP: 80239 BUSINESS PHONE: 3033734860 MAIL ADDRESS: STREET 1: PO BOX 39S CITY: DENVER STATE: CO ZIP: 80219-0019 SC 13D/A 1 slgd13d4.txt FORM 13D AMENDMENT NUMBER 2 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D (AMENDMENT NO. 2) Under the Securities Exchange Act of 1934 SCOTT'S LIQUID GOLD, INC. ------------------------------------------------------------------------------- (Name of issuer) COMMON STOCK ------------------------------------------------------------------------------- (Title of class of securities) 810-202101 -------------------------------------------------------- (CUSIP number) TIMOTHY J. STABOSZ, 1307 MONROE STREET, LAPORTE, IN 46350 (219) 324-5087 ------------------------------------------------------------------------------- (Name, address and telephone number of person authorized to receive notices and communications) NOVEMBER 1, 2012 -------------------------------------------------------- (Date of event which requires filing of this statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. [_] The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). CUSIP No. 810-202101 -------------------------------------------------------------------------------- 1. Name of Reporting Person TIMOTHY JOHN STABOSZ -------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [_] NOT APPLICABLE (b) [_] -------------------------------------------------------------------------------- 3. SEC Use Only -------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) PF -------------------------------------------------------------------------------- 5. Check Box If Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6. Citizenship or Place of Organization UNITED STATES -------------------------------------------------------------------------------- Number of (7) Sole Voting Power 774,227 Shares ____________________________________________ Beneficially (8) Shared Voting Power 0 Owned by ____________________________________________ Each (9) Sole Dispositive Power 774,227 Reporting ____________________________________________ Person With (10) Shared Dispositive Power 0 -------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned 774,227 by each Reporting Person -------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes [_] Certain Shares -------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 7.1% -------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) IN -------------------------------------------------------------------------------- ITEM 1. Security and Issuer Common stock of Scott's Liquid Gold, Inc. ("the company"), 4880 Havana Street, Denver, CO 80239. ITEM 2. Identity and Background The reporting person, Timothy J. Stabosz, 1307 Monroe Street, LaPorte, IN 46350, a natural person and United States citizen, is engaged as a private investor. He has not been convicted in a criminal proceeding (excluding traffic violations or other similar misdemeanors) in the last 5 years, and has not been a party to any proceedings, or subject to any judgements, enjoinments, decrees, et al., related to violations of state or federal securities laws, in his lifetime. ITEM 3. Source and Amount of Funds or Other Consideration Personal funds in the aggregate amount of $175,438.18 have been used to effect the purchases. No part of the purchase price represents borrowed funds. ITEM 4. Purpose of Transaction The reporting person has acquired the shares for investment purposes. He believes he is the largest unaffiliated shareholder of the company. The reporting person submitted a letter to the board of directors (see Exhibit #1), dated November 24, 2012, expressing support for the pending transaction to sell the company's Denver real estate for $9.5 million. (See the company's November 21, 2012 Form 8-K filing.) However, he also indicated in the letter that it is imperative, considering how CEO Mark Goldstein has caused the company to suffer a net loss for 14 out of the last 15 years, that the company provide an opportunity for those shareholders who want to "move on" from their investment in the company, to be given that opportunity, as a result of the "liquidity event" of the real estate sale. More specifically, in the letter, the reporting person seeks a meeting with the board to discuss specific uses for the cash generated from the pending real estate sale. Among other options, he asks the board to consider a large one time dividend, a "going private" transaction or sale of the entire company, or, his preferred alternative, a self-tender for 3 million common shares or more, at a price of not less than 50 cents, that would allow for each shareholder to decide for himself whether he wants to "stay" or "go." The reporting person intends to review his investment in the company on a continual basis and engage in discussions with management and the Board of Directors concerning the governance, business, operations, and future plans of the company. Depending on various factors, including, without limitation, the company's financial position and investment strategy, the price levels of the common stock, conditions in the securities markets, and general economic and industry conditions, the reporting person may, in the future, take such actions with respect to his investment in the company as he deems appropriate including, without limitation, communicating with other stockholders, seeking Board representation, making proposals to the company concerning the capitalization and operations of the issuer, purchasing additional shares of common stock or selling some or all of his shares, or changing his intention with respect to any and all matters referred to in Item 4. Other than as indicated in this (including the letter attached hereto) and previous 13D filings, the reporting person has no plans or proposals which relate to, or could result in, any matters referred to in subsections (a) through (j) of Item 4 of Schedule 13D. ITEM 5. Interest in Securities of the Issuer As of the close of business on November 23, 2012, the reporting person has sole voting and dispositive power over 774,227 shares of Scott's Liquid Gold, Inc.'s common stock. According to the company's 3rd quarter 2012 Form 10-Q, as of November 9, 2012 there were 10,937,000 common shares outstanding. The reporting person is therefore deemed to own 7.1% of the company's common stock. Transactions effected by the reporting person, in the 60 days prior to the November 1st "trigger" date, through November 21, 2012, were performed in ordinary brokerage transactions, and are indicated as follows: 10/17/12 bought 10,000 shares @ $.121 11/01/12 bought 150,000 shares @ $.130 11/12/12 bought 25,000 shares @ $.144 11/14/12 bought 13,900 shares @ $.144 11/21/12 sold 10,000 shares @ $.21 ITEM 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer None ITEM 7. Material to be Filed as Exhibits Exhibit #1: Letter dated 11/24/12 to the SLGD Board of Directors SIGNATURES After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Date 11/26/12 Signature Timothy J. Stabosz Name/Title Timothy J. Stabosz, Private Investor EX-1 2 slgdltr3.txt LETTER TO SLGD BOARD DATED NOVEMBER 24, 2012 Timothy J. Stabosz 1307 Monroe Street LaPorte, IN 46350 PH: (219) 324-5087 Board of Directors Scotts Liquid Gold-Inc. 4880 Havana Street Denver, CO 80239 Mark E. Goldstein Jeffrey R. Hinkle Dennis H. Field Jeffry B. Johnson Gerald J. Laber Philip Neri November 24, 2012 Members of the Scott's Liquid Gold Board: As Scott's Liquid Gold's largest outside shareholder, with a 7.1% ownership stake, I note with great interest the November 21, 2012 8-K filing indicating the pending sale of company real estate for $9.5 million. While I fully support the transaction, I have grave concerns about the intentions the board has for the use of the approximately $5.5 million in net cash that would result. It is imperative that you realize, as a board, and that Mr. Goldstein realize, that many or most of your outside shareholders are NOT interested in participating in the continuation of this company, and having this board, and a CEO with a record of long-term failure, "invest" the proceeds. I want to make it clear to you that I personally view the closing of this transaction as an appropriate time for you, the board, TO PROVIDE AN ENDGAME FOR THOSE WHO WANT OUT OF SCOTT'S LIQUID GOLD...and who want OUT of Mr. Goldstein's abysmal record of net losses for what will be, in 2012, 14 out of the last 15 years, with both revenues and shareholders' equity down 70% or more, over those same 15 years. Therefore, I am, at this time, respectfully requesting an in person meeting with the entire board, in December, to discuss options the company would intend to pursue with the liquidity that would be generated from this transaction. I would also request that you solicit your other large outside shareholders to be invited to such a meeting. I want to emphasize to you, in no uncertain terms, that those of us who have been around this company long enough view this board's toleration of the value destruction under Mr. Goldstein as an outrageous dereliction...and view the cash that will be generated from this transaction as OURS, and not Mr. Goldstein's to do with as he pleases. If you are not willing to reach out to me, and all of the outside shareholders, at this time, to discuss what the appropriate uses for that cash may be, I would see that as nothing less than a "declaration of war," by the board, against its entire outside shareholder base. I also hasten to remind you that, at the last annual meeting, in May 2012, the election would have resulted in EVERY SINGLE ONE OF THE BOARD MEMBERS BEING WITHHELD, if you exclude shares that Mr. Goldstein controls from the calculation. Considering there was no organized proxy contest or withhold campaign, the election results represent a WHOLESALE REJECTION of the entire board...and a stinging rebuke of your longstanding support of the current CEO. One would hope you will take that vote as the sobering message it is...that most of the outside shareholders are tired of being "taken along for the ride," as the company, under Mr. Goldstein, continually erodes in value. With all of this in mind, there are a number of ways to deploy the cash that would result from closing the real estate deal. A large cash dividend or stock buyback...or even a "going private" transaction or a sale of the entire company should be considered. By my estimation, an effort to "maximize shareholder value," starting with a 50 cent per share dividend, would likely result in a per share value somewhere in the range of $.75-1.00 or more, which would respresent a multiple of anywhere from FIVE TO SEVEN TIMES the 15 cent price the common stock was trading at, before you filed the 8-K announcing the pending sale of real estate. Such a return to shareholders would be astronomical...and is not to be ignored! Another alternative, that would be quite fair to all parties, would be to facilitate those who want to "get out" to do just that, while allowing those who want to "stay" to stay...by conducting a self tender for 3 million (or more) shares, at a price of not less than 50 cents per share. After speaking tonight with Director Bub Laber, I want you to know that I have chosen to be infinitely more measured in the tone of this 13D filing, compared to the scathing narrative I originally wrote. I hope you will appreciate that. It is also my hope that you will seek to reestablish trust that has been pretty much destroyed, by reaching out directly to myself, and to other engaged outside shareholders, such as Richard Barone, Michael Deutsch, etc., regarding their view of appropriate uses of the cash that is generated from the proposed transaction. I want to again emphasize that the time to do that outreach is NOW, well before the deal closes. Considering how much grave offense and insult has been taken (certainly by myself), with the board's unacceptable ignoring of the critical problem areas I and others have sought to bring to your attention, one hopes that the board will now take it upon itself to rebuild bridges that it has previously burned. With the ability to "unlock" so much value now before us, it is important that the board look at ALL options, as your fudiciary duty requires. Please have Mr. Laber or Mr. Goldstein follow up with me promptly, on your plans to solicit input, and to explore the possibility of coming to formal understandings, about what the company will do with the cash, so that all shareholders will have an equal ability to participate in the rewards of this transaction...but most importantly, that those who want to "unhook themselves from this train" and be provided the ability to remove our capital from this company, will be provided the opportunity to do so, if we no longer want to participate, with Mr. Goldstein at the helm. Respectfully, Timothy J. Stabosz