0001162893-12-000011.txt : 20121212
0001162893-12-000011.hdr.sgml : 20121212
20121212132730
ACCESSION NUMBER: 0001162893-12-000011
CONFORMED SUBMISSION TYPE: SC 13D/A
PUBLIC DOCUMENT COUNT: 2
FILED AS OF DATE: 20121212
DATE AS OF CHANGE: 20121212
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: 121258547
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
slgd13d5.txt
SLGD FORM 13D AMENDMENT NUMBER 3
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(AMENDMENT NO. 3)
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)
DECEMBER 11, 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 764,227
Shares ____________________________________________
Beneficially (8) Shared Voting Power 0
Owned by ____________________________________________
Each (9) Sole Dispositive Power 764,227
Reporting ____________________________________________
Person With (10) Shared Dispositive Power 0
--------------------------------------------------------------------------------
11. Aggregate Amount Beneficially Owned 764,227
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) 7.0%
--------------------------------------------------------------------------------
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 $174,039 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
continues to believe he is the largest unaffiliated shareholder of Scott's
Liquid Gold.
The reporting person submitted a letter to the board of directors, dated
December 11, 2012 (see Exhibit #1). In the letter, the reporting person
chastises the board for fabricating a far flung assortment of phantasmagoric
allegations against the reporting person, in a degraded "bought attorney
letter." (See the company's 8-K filing dated December 3, 2012.) The
reporting person believes that a truly independently-governed, and
self-respecting board would communicate DIRECTLY with its largest outside
shareholder, rather than hiring a 3rd party "mercenary" to engage in
destructive and demeaning threats, bluster, and brinksmanship. The reporting
person further alleges that, besides countenancing charges that the board
knows are patently false, even more troublingly, the board has brazenly
attempted to coerce and stifle the reporting person, in the legitimate
exercise of his First Amendment rights.
The reporting person believes that the board's disproportionate and
exceedingly antagonistic response, to his mere request for a MEETING with the
board, evidences that the company's Chairman and CEO, Mark Goldstein,
continues to have his yoke fully placed upon the board, maintaining it in a
position of being fully subservient, subjugated, and docile to Mr. Goldstein's
wishes...with the board's primary imperative being the maintenance of Mr.
Goldstein's astonishing 22 year record of self-entrenchment as CEO.
The reporting person repeats his demand that the board show appropriate
accountability, and meet with major outside shareholders, no later than
immediately after the closing of the real estate transaction described in the
company's Form 8-K dated November 21, 2012, to discuss the appropriate use of
the proceeds from said transaction.
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 December 11, 2012, the reporting person has
sole voting and dispositive power over 764,227 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 7.0% of the company's common stock.
Transactions effected by the reporting person, since November 21, 2012, were
performed in ordinary brokerage transactions, and are indicated as follows:
11/30/12 sold 10,000 shares @ $.3995
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 December 11, 2012 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 12/12/12
Signature Timothy J. Stabosz
Name/Title Timothy J. Stabosz, Private Investor
EX-1
2
slgdltr5.txt
LETTER TO THE SLGD BOARD DATED 12/11/12
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
December 11, 2012
Members of the Scott's Liquid Gold ("SLGD") Board:
One truly has to wonder, with utmost awe and astonishment, what exactly it
is about a letter from your largest outside shareholder, merely requesting a
meeting with the SLGD board to discuss the intended use of proceeds from a
pending real estate transaction, that would cause the board to go into a
frenzy of conniptions, attacks, threats, and brinksmanship. Surely, you
must realize, in its wild disproportion, how absurd your 8-K filing and
attorney letter make the board look.
Instead of engaging in this grotesque act of corporate waste, frittering
away shareholder monies on an outside "hack job," why didn't you just pick
up the telephone and CALL me, to listen to what my thoughts and ideas were,
and where I was coming from? Why didn't you remotely consider THAT as the
honorable, responsible, measured, and preferred course? I think the answer
is clear.
The disingenuous intent of the board is plainly evident: Procure a hired
gun to "trump up" a host of baseless charges, and throw them against the
wall to see how many "stick," in order to INTIMIDATE, MANIPULATE, AND
SILENCE a shareholder, who (my legal counsel assures me) has every right to
voice his opinion about Scott's Liquid Gold's failed corporate governance,
failed executive oversight, and wanton destruction of shareholder value, at
the hands of an incompetent CEO, who has been self-entrenched for 22 tragic
years.
In order to set the record straight, and defend my integrity, you have
forced me to take the time to respond and rebut the false, misleading, and
mendacious charges in the board's "purchased attack letter." I will have
you know that I am none too pleased...and I reserve all rights to hold you
accountable, as a civil matter, for soliciting an outside attorney to
muckrake such utterly inane allegations that 1) were and are wrong, 2) you
knew were wrong, and 3) that you made in reckless disregard of the truth. To
wit:
1) Stabosz's public communications "give rise to an actionable claim...for
interference with a prospective business opportunity."
This is clearly a figment of your outside legal counsel's imagination. My
counsel has made it clear to me that my PUBLIC SUPPORT of the real estate
transaction makes this charge baseless, vexatious, and fraudulent in its
essence. Furthermore, merely because the company is in the process of
selling a piece of real estate, the notion that that precludes shareholders
from voicing public opinions about the use of the proceeds, governance of
the company, or any other matters, is an absolute canard, and represents a
coercive attempt by the SLGD board to stifle a shareholder in the legitimate
exercise of his 1st Amendment rights.
2) Stabosz's 13D "contains materially misleading statements, in violation
of applicable securities laws."
This claim is patently FALSE, and shows a reckless disregard for the truth
on the part of the board. (See below items.)
3) "You have made omissions in the Schedule 13D regarding the shareholder
group you claim to represent."
I did not "claim" to represent anyone other than myself, nor could it, by
any reasonable standard, be argued that I am part of a 13D group. I
mentioned two other shareholders, in my filing, simply because I MET them at
the 2011 annual meeting (a public venue)...and I happened to witness, at
that meeting, that they contributed sustantially, in their own right, to the
discussion about how Scott's Liquid Gold could best cure its dysfunctional
governance. Since I didn't believe it appropriate to limit the input in my
proposed private meeting with the board to myself, in my most recent board
letter, I asked the board to consider including those two other major
shareholders, AND OTHER LARGE SHAREHOLDERS. No self-respecting observer
could claim that that somehow "morphs" me into a "group," and my counsel
assures me that there is no legal precedent suggesting otherwise.
4) "You made...misstatements regarding the anticipated net proceeds" of the
transaction.
My definition of "net proceeds" apparently differs from the company's. My
reference to "net proceeds" is accurate in the context I presented it (sale
price of real estate, less estimated commission, less pay off of mortgage
debt).
5) "You also suggest that the sale/leaseback transaction...would allow the
company to pay a 50 cent dividend. This suggestion is materially inaccurate
and dangerous..."
There is nothing "dangerous" about it. What I DID say is that the
sale/leaseback transaction, AS PART OF A MULTI-STEP PROCESS TO MAXIMIZE
SHAREHOLDER VALUE, would, IN MY ESTIMATION (depending on how exactly the
company chooses to restructure its balance sheet, management, operations,
etc.), allow the company to pay a 50 cent dividend. I am still convinced
that that is true.
6) "For years, the company's management and board has endured with
patience your ongoing verbal assaults and character assasinations."
The claim is false. My first public filing taking the board to task was not
"years" ago...it was in March of 2011. Prior to that, I had tried to, in
vain, discreetly and in the background, get Mr. Goldstein to confront his
inherently conflicted position, vis a vis the company and "his" board. But
it became increasingly clear to me that this was not something Goldstein, or
the board, were interested in facing, without public pressure and
accountability...since Goldstein's primary consideration, this whole time,
has been the maintenance of his personal sinecure (i.e. his $400,000+ a year
compensation package), as well as his spouse's employment, in what has been
treated as a "family owned" company...in stark defiance of Goldstein's and
the board's fiduciary responsibility to outside shareholders.
7) "Your inflammatory remarks have added to the difficulty of navigating
what has been one of the most challenging markets, particularly for this
company's industry, that this country has ever experienced."
It has nothing to do with "this country" or "this company's industry"; it
has to do with Scott's Liquid Gold! The power to FIX the company LIES
WITHIN. It does NOT LIE IN EXCUSE-MAKING...or feeling sorry for Mr.
Goldstein, and sticking one's head in the sand. The statement shows that
the board remains firmly ensconced in a world of denial and evasion, and,
reflecting a staggering moral default, continues to allow Mr. Goldstein to
live in a similarly illusory world, by pretending as if Scott's Liquid
Gold's problems the last 15 or more years are because of "challenging
markets," as opposed to facing the patently obvious truth...which is that
the company has a MANAGERIAL PROBLEM at the top.
8) "Not only have you attacked management, you have also made baseless
claims about the independence, judgement, and integrity of the outside
directors of the board."
The board has self-evidently been STACKED by Mark Goldstein, and, despite my
ongoing demands that this nonsense stop, it still consists of 4 out of 6
members that are either employees, former employees, or otherwise beholden
to the Goldstein family. It doesn't matter if the other 2 directors MIGHT
be "nominally independent." They have engaged in a pattern of witnessing,
countenancing, and enabling a board whose majority is collectively tethered
to, exists exclusively as a rubber stamp for, and continues to do the
bidding of the CEO, in a most unabashed and impudent of fashions.
9) "Despite your alleged grave concerns about the company's management and
oversight...you have continued to acquire stock in the company."
This claim is totally irrelevant. I have the right to buy or sell stock at
any time for any reason. By buying MORE stock, in a company that needs
"fixing," I can be more effective in my efforts to bring about necessary
change, and draw more attention to the importance of my cause.
10) "The company demands that you refrain from any further tortious
activity..."
The company can fabricate "tortious activity" all it wants...but it is the
TRUTH that will finally set Scott's Liquid Gold's outside shareholders free.
And I fully intend to continue to tell that truth, with the exclusive goal
of protecting, and enhancing, shareholder value. (Would that the derelict
SLGD board had been been focused on the same thing, these last 22 years.)
I wish to again emphasize that I fully support the pending real estate
transaction, and believe it is a necessary step in the process of unlocking
the value that remains, for ALL of Scott's Liquid Gold's shareholders. But
I also reiterate my request that the board seek a meeting with its larger
outside shareholders, sooner rather than later, so that said shareholders
may give input as to the appropriate use of the proceeds from the
transaction. (The fact that you suggested in your December 3, 2012 8-K
filing that such input can wait until the shareholder meeting in May, is a
grave affront, and clearly evidences that the board plans to continue
remaining utterly passive, indulging the CEO's every whim and desire.)
In my view, as we move forward from this point, it will be most intriguing
to see just how far "out on a limb" this board is willing to go, in standing
by Mr. Goldstein, and continuing to fulfill its longstanding role of
providing a sinecure, and a "safe world," for the SLGD scion to exist in.
In the case of Messrs. Johnson, Hinkle, and Field, I don't think anyone is
surprised that they are incapable of making ANY kind of independent
judgments. The case of bonafide outsiders Bud Laber and Philip Neri becomes
much more interesting, and is going to be the true test. Should
opportunities to "unlock value" present themselves, will Messrs. Laber and
Neri stand up to be heard, and finally speak on behalf of the "rest of
us"...or will they risk their professional reputations, and perversely fall
on their swords, to "secure and bless" more of the same nonsense at Scott's
Liquid Gold, that we've been seeing for years on end? If the latter, for
what moral purpose, and to what fiduciary end?
Surely, the Scott's Liquid Gold board, as unaccountable as it is, can be
compelled to face this one stark reality: The sale of the real estate
represents the LAST CHANCE for outside shareholders to salvage significant
value, with their investment in this company. Passively sitting by, and
allowing the board to just "hand over" the proceeds to a failed CEO, to be
frittered away at will, while he collects another $400,000 a year for the
privilege of doing it, is the height of insanity. It is not something your
outside shareholders can afford, financially or morally, to tolerate. I
certainly know I'm not going to...without fully calling you to task, holding
you individually responsible, and otherwise providing a moral witness to
this continued travesty.
Large shareholders...all shareholders, in fact...deserve to be treated
with respect, and it is long since time the board have the rectitude to
place our rights and concerns on an equal footing to those of the
inestimable Mr. Goldstein.
I again request a private meeting with you to discuss my thoughts and ideas
on the appropriate uses of the proceeds from the pending real estate
transaction.
With solemnity and resolve,
Timothy J. Stabosz