0001144204-14-047676.txt : 20140807 0001144204-14-047676.hdr.sgml : 20140807 20140807150749 ACCESSION NUMBER: 0001144204-14-047676 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20140807 DATE AS OF CHANGE: 20140807 GROUP MEMBERS: CEDAR CREEK PARTNERS LLC SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: SOLITRON DEVICES INC CENTRAL INDEX KEY: 0000091668 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 221684144 STATE OF INCORPORATION: DE FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-08686 FILM NUMBER: 141023447 BUSINESS ADDRESS: STREET 1: 3301 ELECTRONICS WAY CITY: WEST PALM BEACH STATE: FL ZIP: 33407 BUSINESS PHONE: 4078484311 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: ERIKSEN CAPITAL MANAGEMENT LLC CENTRAL INDEX KEY: 0001616134 IRS NUMBER: 203729203 STATE OF INCORPORATION: WA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 567 WILDROSE CIR CITY: LYNDEN STATE: WA ZIP: 98264 BUSINESS PHONE: 3603933019 MAIL ADDRESS: STREET 1: 567 WILDROSE CIR CITY: LYNDEN STATE: WA ZIP: 98264 SC 13D 1 v123456_sc13d.htm SC 13D

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

SCHEDULE 13D

 

Under the Securities Exchange Act of 1934
(Amendment No. _)*

 

Solitron Devices, Inc.

(Name of Issuer)

 

Common Stock, par value $.001 Per Share

(Title of Class of Securities)

 

834256208

(CUSIP Number)

 

Tim Eriksen

Eriksen Capital Management LLC

567 Wildrose Circle

Lynden, WA 98264

(360) 393-3019

 

  

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

 

July 31, 2014

(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 that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ¨

 

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

 

 

* The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

 

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. 83425620813DPage 2 of 7 Pages

   

         
1.   NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

ERIKSEN CAPITAL MANAGEMENT LLC
   
2.   CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(see instructions)
(a)    ¨
(b)    ¨
   
3.   SEC USE ONLY
 
   
4.   SOURCE OF FUNDS (see instructions)
 
WC
   
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 SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH   7.   SOLE VOTING POWER
 
112,202
  8.   SHARED VOTING POWER
 
0
  9.   SOLE DISPOSITIVE POWER
 
112,202
  10.   SHARED DISPOSITIVE POWER
 
0

         
11.   AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

112,202
   
12.   CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(see instructions)    ¨
   
13.   PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

5.13%
   
14.   TYPE OF REPORTING PERSON (see instructions)

IA
   

 

 
CUSIP No. 83425620813DPage 3 of 7 Pages

  

         
1.   NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

CEDAR CREEK PARTNERS LLC
   
2.   CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(see instructions)
(a)    ¨
(b)    ¨
   
3.   SEC USE ONLY
 
   
4.   SOURCE OF FUNDS (see instructions)
 
WC
   
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 SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH   7.   SOLE VOTING POWER
 
104,902
  8.   SHARED VOTING POWER
 
0
  9.   SOLE DISPOSITIVE POWER
 
104,902
  10.   SHARED DISPOSITIVE POWER
 
0

         
11.   AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

104,902
   
12.   CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(see instructions)    ¨
   
13.   PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

4.80%
   
14.   TYPE OF REPORTING PERSON (see instructions)

PN
   

 

 
CUSIP No. 83425620813DPage 4 of 7 Pages

  

 

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

 

Item 1. Security and Issuer

 

This Schedule 13D relates to shares of the Common Stock, par value $.01 per share (the “Common Stock”), of Solitron Devices, Inc. (the “Issuer” or “Solitron Devices”).  The address of the issuer is 3301 Electronics Way, West Palm Beach, Florida, 33407.

 

Item 2. Identity and Background

 

(a)    This Statement is filed by Tim Eriksen on behalf of Eriksen Capital Management LLC (“ECM”), a registered investment adviser with the State of Washington. ECM is the managing member of Cedar Creek Partners, LLC (“CCP”), a private investment partnership, and investment advisor to separately managed accounts. Each of the foregoing is referred to as a “Reporting Person” and collectively as the “Reporting Persons.” By virtue of his position with ECM, Mr. Eriksen has the sole power to vote and dispose of the Issuer’s Shares owned by CCP.  

 

(b)    The principal business address of Mr. Eriksen, ECM and CCP is 567 Wildrose Circle, Lynden, WA 98264.

 

(c)     The principal business of CCP is acquiring, holding and disposing of investments in various companies. The principal business of ECM is serving as the investment manager of CCP and separately managed accounts. The principal occupation of Mr. Eriksen is serving as the sole manager of ECM.

 

(d) No Reporting Person described herein has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

 

(e) None of the Reporting Parties described herein has, during the last five years, been party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violations with respect to such laws.

 

(f) Mr. Eriksen is a citizen of the United States.

 

Item 3. Source and Amount of Funds or Other Consideration

 

The Common Stock of the Issuer was acquired in open market purchases with working capital of CCP and the uncommitted cash of separately managed accounts (“SMA”). The amount of funds expended, excluding commissions, to acquire the shares held by CCP is $432,989, and for the SMAs is $30,287.

 

 
CUSIP No. 83425620813DPage 5 of 7 Pages

 

 

Item 4. Purpose of Transaction

 

ECM acquired shares of Solitron Devices because they believed and continue to believe that the Common Stock is significantly undervalued.  While we believe Solitron's leadership has done a good job managing the Company from an operational perspective, including, but not limited to, cash flow generation and resolving historical liabilities, we also believe Solitron needs to improve its capital allocation, make better use of its NOL’s, and substantially strengthen its board of directors.  For this reason, we intend to encourage the board’s nominating committee to recruit additional directors from its shareholder base.  

 

On August 6, 2014, CCP, the private partnership managed by ECM, wrote to the nominating committee of Solitron Devices to encourage them to reach out to large shareholders in order to nominate directors who can be approved by shareholders. In the letter, Tim Eriksen, the President and Managing Member of ECM, indicated his willingness to serve on the board. A copy of the letter to the board is attached as Exhibit 1 to this Schedule 13D.

 

No Reporting Person has any present plan or proposal which would relate to or result in any of the matters set forth in subparagraphs (a) - (j) of Item 4 of Schedule 13D except as set forth in this Schedule 13D or such as would occur upon completion of any of the actions discussed above. Each of the Reporting Persons intends to review its investment in the Issuer on a continuing basis and engage in discussions with management and the Board of the Issuer concerning the business, operations and future plans of the Issuer. Depending on various factors including, without limitation, the Issuer’s financial position and investment strategy, the price levels of the Shares, conditions in the securities markets and general economic and industry conditions, each of the Reporting Persons may in the future take such actions with respect to its investment in the Issuer as it deems appropriate including, without limitation, making other proposals to the Issuer concerning changes to the capitalization, ownership structure or operations of the Issuer, purchasing additional Shares, selling some or all of its Shares, engaging in short selling of or any hedging or similar transaction with respect to the Shares or changing its intention with respect to any and all matters referred to in Item 4.

 

Item 5. Interest in Securities of the Issuer

 

The following list sets forth the aggregate number and percentage (based on 2,185,832 shares of Common Stock outstanding on July 1, 2014 as reported in the Issuer’s Form 10-Q, for the period ended May 31, 2014) of outstanding shares of Common Stock owned beneficially by Eriksen Capital Management LLC (“ECM”).

 

         
Name  No. Of Shares   Percent of Class 
         
Cedar Creek Partners LLC (1)   104,902    4.80%
Separately Managed Accounts (2)   7,300    0.33%
Total   112,202    5.13%

 

 
CUSIP No. 83425620813DPage 6 of 7 Pages

 

(1) These Shares are owned by Cedar Creek Partners LLC, an investment partnership, for which ECM is Managing Member, and acts as the discretionary portfolio manager.

 

(2) These Shares are owned by investment clients of ECM, who are also responsible to vote the shares. ECM does not own these shares directly, but by virtue of ECM’s Investment Advisory Agreement with the clients of ECM, each may be deemed to beneficially own Shares by reason of their power to dispose of such Shares. ECM disclaims beneficial ownership of such Shares.

 

“Relevant Transactions in Shares” in the past 60 days. All were open market purchases.

 

Separately Managed Accounts  
Date Buy/Sell Quantity Price
7/9/2014 Buy             800 4.19
7/11/2014 Buy          2,000 4.15
7/11/2014 Buy             500 4.17
7/14/2014 Buy             500 4.12
7/25/2014 Buy          3,000 4.13
             6,800  
       
Cedar Creek Partners LLC  
Date Buy/Sell Quantity Price
6/20/2014 Buy            7,600 4.00
6/24/2014 Buy            1,286 4.10
6/25/2014 Buy            3,703 4.10
6/27/2014 Buy            1,011 4.10
6/30/2014 Buy                300 4.04
7/1/2014 Buy            5,400 4.12
7/7/2014 Buy          14,102 4.16
7/10/2014 Buy                898 4.16
7/11/2014 Buy            2,892 4.15
7/14/2014 Buy                200 4.15
7/14/2014 Buy                800 4.05
7/18/2014 Buy            2,300 4.10
7/21/2014 Buy                500 4.10
7/22/2014 Buy                500 4.10
7/23/2014 Buy            2,000 4.10
7/29/2014 Buy          33,500 4.10
7/31/2014 Buy            9,000 4.10
8/5/2014 Buy            1,900 4.05
             87,892  

 

Prices exclude commissions

 

 
CUSIP No. 83425620813DPage 7 of 7 Pages

 

 

Item 6. Contracts, Arrangements, Understanding or Relationships with Respect to Securities of the Issuer.

 

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

 

Item 7. Material to be Filed as Exhibits

 

Exhibit 1: Letter from Cedar Creek Partners to the Nominating Committee for the Board of Directors of the Issuer dated August 6, 2014.

 

 

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.

 

Dated:

August 6, 2014      

ERIKSEN CAPITAL MANAGEMENT LLC

 

By:/s/ Tim Eriksen

Tim Eriksen

Managing Member

  

 

EX-99.1 2 v123456_ex99-1.htm EXHIBIT 1

Exhibit 1

Description: cedarcreek_logo

Managing Member – Tim Eriksen Eriksen Capital Management, LLC

 

 

Solitron Devices, Inc.

Board of Directors – Nominating Committee
3301 Electronics Way
West Palm Beach, FL 33407

 

 

August 6, 2014

 

 

Reference: CCP-14-011 – Solitron Director Openings

 

 

Dear Nominating Committee:

 

It was a pleasure to meet you at the 2014 annual meeting of Solitron Devices. The board’s willingness to interact with, and be responsive to, shareholders is a positive step for the company. While I was not in attendance at the 2013 annual meeting, it seems clear that relations between management (including the board) and shareholders are moving in the right direction. Hopefully that progress will continue.

 

Shareholders rejection of two of the board’s four nominees in 2013, and the board’s sole nominee in 2014, who was one of the two nominees approved the prior year, shows that the board and shareholders (i.e., the owners of the company) are not on the same page. This is not ideal for the company or its shareholders, as it diverts attention away from operations, and often results in unnecessary legal and administrative costs. It is our opinion that the board needs to reach out to its larger shareholders to solicit candidates for the board in order to enhance both the quality of the board and overall results for the company.

 

We believe there are a number of people who are qualified and willing to serve within Solitron’s shareholder base. Ancora Advisors mentioned the same idea in its March 2013 13-D filing, and we think it is truer today. In addition, we think it benefits the company when its directors own a meaningful stake.

 

Thus we want to encourage the board to reach out to its major shareholders and solicit nominees for the board. We would encourage the board to add two new directors from its shareholder base and have them be subject to confirmation at the next annual meeting, regardless of whether they stand as Class I, II, or III directors.

 

While West Palm Beach is quite far from our location, I would be willing to serve on the board. For the past eight and a half years I have managed a small hedge fund focused on micro and small cap companies. I have a particular expertise in unlisted stocks such as Solitron. Over the eight and a half years the fund has generated average annual returns, net of fees and expenses, in excess of 18% per year. Gross of fees, returns have averaged nearly 24% per year. Thus we understand the risks and opportunities that public unlisted micro cap companies face, including financing and acquisitions.

 

 
 

 

Prior to starting my own investment advisory business, I spent a few years working for Walker’s Manual, a publisher of manuals covering unlisted, micro-cap, and community bank stocks. From 1999 to 2004 I was employed by Peter Kiewit Sons as an administrative engineer. From 2002 to 2004 I worked on the Benicia-Martinez Bridge, which due to changes became largely a $700 million cost plus project. My primary role was to track costs and to properly submit to the California Department of Transportation (CalTrans) for payment, thus I am familiar with some of the issues Solitron faces with its government contracts.

 

In terms of my educational background, I have an MBA from Texas A&M University, earned in 1997, and bachelor’s degrees in History and Political Studies from The Master’s College, earned in 1991.

 

Most importantly, we would point out that our interests are aligned with that of other shareholders. As of today Cedar Creek Partners owns 104,902 shares and separately managed accounts of Eriksen Capital Management own an additional 7,300 shares. As a 5% shareholder we appreciate what management has accomplished operationally so far, and look forward to working with management to create a prosperous future for both shareholders and employees of Solitron.

 

If you would like to discuss the issue further, I would be more than happy to do so. I can be reached at 360-393-3019.

 

Sincerely,

Tim Eriksen

Managing Member

Cedar Creek Partners

 

 

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