0001214659-18-004874.txt : 20180717 0001214659-18-004874.hdr.sgml : 20180717 20180717161522 ACCESSION NUMBER: 0001214659-18-004874 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20180716 ITEM INFORMATION: Completion of Acquisition or Disposition of Assets ITEM INFORMATION: Submission of Matters to a Vote of Security Holders ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20180717 DATE AS OF CHANGE: 20180717 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Wright Investors Service Holdings, Inc. CENTRAL INDEX KEY: 0001279715 STANDARD INDUSTRIAL CLASSIFICATION: INVESTMENT ADVICE [6282] IRS NUMBER: 134005439 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-50587 FILM NUMBER: 18956652 BUSINESS ADDRESS: STREET 1: 100 SOUTH BEDFORD ROAD, SUITE 2R CITY: MOUNT KISCO STATE: NY ZIP: 10549 BUSINESS PHONE: (914) 242-5700 MAIL ADDRESS: STREET 1: 100 SOUTH BEDFORD ROAD, SUITE 2R CITY: MOUNT KISCO STATE: NY ZIP: 10549 FORMER COMPANY: FORMER CONFORMED NAME: NATIONAL PATENT DEVELOPMENT CORP DATE OF NAME CHANGE: 20040211 8-K 1 r7121808k.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
 
FORM 8‑K
 
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): 
July 16, 2018

WRIGHT INVESTORS’ SERVICE HOLDINGS, INC.
(Exact Name of Registrant as Specified in Its Charter)

Delaware
(State or Other Jurisdiction of Incorporation)

000-50587          
 13-4005439
(Commission File Number)          
 (IRS Employer Identification No.)

 
177 West Putnam Avenue, Greenwich CT          
 06830
(Address of Principal Executive Offices)          
 (Zip Code)

(914) 242-5700
(Registrant’s Telephone Number, Including Area Code)

 
(Former Name or Former Address, if Changed Since Last Report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 40.13e-4(c))
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
   
 
 
Item 2.01. Completion of Acquisition or Disposition of Assets.
 
As previously disclosed, on April 11, 2018, Wright Investors’ Service Holdings, Inc., a Delaware corporation (the “Company”), Khandwala Capital Management, Inc., a Connecticut corporation (“Purchaser”), and Amit S. Khandwala (“ASK”) entered into a Stock Purchase Agreement (the “Agreement”).  Pursuant to the Agreement, upon the terms and subject to the satisfaction or waiver of the conditions therein, the Company agreed to sell, and Purchaser agreed to purchase for cash (the “Sale”), all of the issued and outstanding stock of the Company’s wholly-owned subsidiary, The Winthrop Corporation (“Winthrop”).  The purchase price (the “Purchase Price”) for the stock is $6.0 million. The Sale was subject to the approval of the stockholders of the Company, which was received on July 16, 2018 at the annual meeting of stockholders of the Company.  On July 17, 2018 the Company completed the Sale.
 
This Current Report on Form 8-K is being filed to provide unaudited pro forma financial information for the Company giving effect to the Sale. Specifically, this pro forma financial information gives effect to (i) events that are directly attributable to the sale and factually supportable, regardless of whether they have a continuing impact or are nonrecurring. The pro forma statements of income are prepared based on the Company’s historical statements and adjusted as if the sale occurred on the first day of each period presented and include adjustments which give effect to the events that are (i) directly attributable to the Sale, (ii) expected to have a continuing impact on the Company, and (iii) factually supportable.
 
The unaudited pro forma financial information is presented for informational purposes only, is based upon estimates by the Company’s management and is not intended to be indicative of actual results of operations or financial position that would have been achieved had the transaction been consummated as of the beginning of each period indicated above or as of March 31, 2018, nor does it purport to indicate results which may be attained in the future.
 
The foregoing description of the Agreement and the transactions contemplated thereby does not purport to be complete and is qualified in its entirety by reference to the full text of the Agreement, which was filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K dated April 11, 2018 and is incorporated herein by reference.
 
Item 5.07.  Submission of Matters to a Vote of Security Holders
 
The Company’s annual meeting of stockholders was held on July 16, 2018. The stockholders approved the sale of Winthrop, elected four directors to the board of directors, approved, on an advisory basis, a resolution approving the Company’s named executive officer compensation, approved, on an advisory basis, the frequency of one year for the vote on executive compensation, and ratified the appointment of EisenAmper LLP as independent auditors for fiscal 2018. For the annual meeting there were 19,476,070 shares outstanding and eligible to votes of which 19,080,690 were present at the meeting in person or by proxy. The tabulation for each matter voted upon at the meeting was as follows:
 
 
Approve the sale of The Winthrop Corporation:
 
For
 13,444,188
Against
 255,594
Abstain
 801
Broker Non-Votes
 5,380,107

 
Election of Directors:
            
   
For
  
Withheld
  
Broker Non-Votes
Harvey P. Eisen
   13,529,550   171,033   5,380,107
Marshall S. Geller
   13,520,154   180,429   5,380,107
Richard C. Pfenniger
   13,530,784   169,799   5,380,107
Lawrence G. Schafran
   13,343,068   357,515   5,380,107


Advisory vote on executive compensation:
  
   
For
 12,888,356
Against
 611,103
Abstain
 201,124
Broker Non-Votes
 5,380,107

 
Advisory vote on the frequency of Executive Compensation:
 
1 year
 12,874,607
2 years
 73,891
3 years
 7,517
Abstain
 744,568

 
Proposal to ratify the appointment of EisnerAmper LLP as independent auditors for 2018:
 
For
 17,359,951
Against
 1,368,912
Abstain
 351,827
 
 
Item 9.01. Financial Statements and Exhibits.
 
(b) Pro Forma Financial Information
 
The following pro forma financial information for the Company with respect to the transaction is filed as Exhibit 99.2 hereto and is incorporated into this item by reference:
 
·
Pro Forma Condensed Consolidated Statement of Operations for the three months ended March 31, 2018
 
·
Pro Forma Condensed Consolidated Statement of Operations for the three months ended March 31, 2017
 
·
Pro Forma Condensed Consolidated Statement of Operations for the year ended December 31, 2017
 
·
Pro Forma Condensed Consolidated Statement of Operations for the year ended December 31, 2016
 
·
Pro Forma Condensed Consolidated Balance Sheet as of March 31, 2018
 
(d) Exhibits.
 
Exhibit No.
Description
   
2.1
   
99.1
 Press release of Wright Investors' Service Holdings, Inc.
   
99.2
 
 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
  WRIGHT INVESTORS’ SERVICE HOLDINGS, INC.
     
     
Date:  July 17, 2018
By:   
/s/ Ira J. Sobotko
   
Name: Ira J. Sobotko
   
Title:   Vice President & Chief Financial Officer
 
 
 
 EX-99.1 2 ex99_1.htm EXHIBIT 99.1
Exhibit 99.1

For Immediate Release
Wright Investors’ Service Holdings, Inc. Completes Sale of The Winthrop Corporation

 
Greenwich, CT, July 17, 2018 -- Wright Investors’ Service Holdings, Inc.  (OTC Pink Sheets: WISH) announced the completion today of the sale of 100% of the issued and outstanding common stock of The Winthrop Corporation (Winthrop), a wholly owned subsidiary of WISH, to Khandwala Capital Management, Inc., a company principally owned and controlled by Amit S. Khandwala, the current Co-Chief Executive Officer and Chief Investment Officer of Winthrop. Winthrop, through its wholly owned subsidiary Wright Investors' Service, Inc., is an investment management and financial advisory firm. 
 
WISH received $6,000,000 in cash upon the closing of the sale. The sale was approved by the WISH stockholders on July 16, 2018 at the annual stockholders meeting.
 
Please refer to WISH's filing on Form 8-K with the Securities and Exchange Commission for further information relating to the transaction.
 
 
 
Contact:
Wright Investors’ Service Holdings, Inc.
Ira J. Sobotko
Vice President and Chief Financial Officer
914-242-5778

 
 EX-99.2 3 ex99_2.htm EXHIBIT 99.2
Exhibit 99.2
 

UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION

On April 11, 2018, Wright Investors’ Service Holdings, Inc., a Delaware corporation (the “Company”), Khandwala Capital Management, Inc., a Connecticut corporation (“Purchaser”), and Amit S. Khandwala (“ASK”) entered into a Stock Purchase Agreement (the “Agreement”).  Pursuant to the Agreement, upon the terms and subject to the satisfaction or waiver of the conditions therein, the Company agreed to sell, and Purchaser agreed to purchase for cash (the “Sale”), all of the issued and outstanding stock of the Company’s wholly-owned subsidiary, The Winthrop Corporation (“Winthrop”).  The purchase price (the “Purchase Price”) for the Stock is $6.0 million. The Sale was subject to the approval of the stockholders of the Company, which was received on July 16, 2018 at the annual meeting of stockholders of the Company.  On July 17, 2018 the Company completed the Sale of Winthrop.

The following unaudited pro forma financial information should be read in conjunction with the related notes and with the Company’s historical consolidated financial statements for the years ended December 31, 2017 and December 31, 2016, and for the three months ended March 31, 2018 and 2017, included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017 and the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2018.

The unaudited pro forma financial information is derived from the Company’s historical financial statements, adjusted to reflect the Sale as if it had occurred at the end of the most recent period for which the balance sheet is presented, March 31, 2018, and includes adjustments which give effect to (i) events that are directly attributable to the Sale and factually supportable, regardless of whether they have a continuing impact or are nonrecurring. The pro forma statements of income are prepared based on the Company’s historical statements and adjusted as if the Sale occurred on the first day of each period presented and include adjustments which give effect to the events that are (i) directly attributable to the Sale, (ii) expected to have a continuing impact on the Company, and (iii) factually supportable.

The unaudited pro forma financial information is presented for informational purposes only, is based upon estimates by the Company’s management and is not intended to be indicative of actual results of operations or financial position that would have been achieved had the transaction been consummated as of the beginning of each period indicated above or as of March 31, 2018, nor does it purport to indicate results which may be attained in the future.
 
 
WRIGHT INVESTORS' SERVICE HOLDINGS INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
For the three months ended March 31, 2018
(unaudited)
(in thousands, except per share amounts)
 
        
Winthrop
    
Pro Forma
    
Pro Forma
  
 
  
Historical
    
adjustment
    
adjustment
    
Statement
  
 
  
Consolidated
    
inc / (dec)
    
inc / (dec)
    
of Operations
  
Revenues
                        
Investment management services
  
$
570
    
$
(570
)
  
$
-
    
$
-
  
Other investment advisory services
    
603
      
(603
)
    
-
      
-
  
Financial research and related data
    
216
      
(216
)
    
-
      
-
  
 
    
1,389
      
(1,389
)
    
-
      
-
  
Expenses
                                
Compensation and benefits
    
859
      
(681
)
            
178
  
Other operating
    
782
      
(487
)
    
44
 (i)
    
339
  
Transaction costs
    
132
      
-
      
-
      
132
  
 
    
1,773
      
(1,168
)
    
44
      
649
  
 
                                
Operating loss
    
(384
)
    
(221
)
    
(44
)
    
(649
)
Interest expense and other loss,  net
    
(20
)
    
23
              
3
  
Loss before income taxes
    
(404
)
    
(198
)
    
(44
)
    
(646
)
Income tax expense
    
(13
)
    
-
      
-
      
(13
)
Net loss
  
$
(417
)
  
$
(198
)
          
$
(659
)
Basic and diluted net loss per share
  
$
(0.02
)
                  
$
(0.03
)
 
                                
Weighted average common shares outstanding:
                                
 
                                
Basic and diluted
    
19,378
                      
19,378
  
 
Pro forma adjustments include:
 
(i)          Add back to Other operating expenses for the portion of rent and facility costs currently incurred by Winthrop
 
2
 
WRIGHT INVESTORS' SERVICE HOLDINGS INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
For the three months ended March 31, 2017
(unaudited)
(in thousands, except per share amounts)
 
        
Winthrop
    
Pro Forma
    
Pro Forma
  
 
  
Historical
    
adjustment
    
adjustment
    
Statement
  
 
  
Consolidated
    
inc / (dec)
    
inc / (dec)
    
of Operations
  
Revenues
                        
Investment management services
  
$
492
    
$
(492
)
  
$
-
    
$
-
  
Other investment advisory services
    
669
      
(669
)
    
-
      
-
  
Financial research and related data
    
183
      
(183
)
    
-
      
-
  
 
    
1,344
      
(1,344
)
    
-
      
-
  
Expenses
                                
Compensation and benefits
    
917
      
(802
)
    
-
      
115
  
Other operating
    
791
      
(472
)
    
44
 (i)
    
363
  
 
    
1,708
      
(1,274
)
    
44
      
478
  
 
                                
Operating loss
    
(364
)
    
(70
)
    
(44
)
    
(478
)
Interest expense and other income (loss),  net
    
(26
)
    
27
      
-
      
1
  
Loss before income taxes
    
(390
)
    
(43
)
    
(44
)
    
(477
)
Income tax expense
    
(12
)
    
-
      
-
      
(12
)
Net loss
  
$
(402
)
  
$
(43
)
          
$
(489
)
Basic and diluted net loss per share
  
$
(0.02
)
                  
$
(0.03
)
 
                                
Weighted average common shares outstanding:
                                
 
                                
Basic and diluted
    
19,137
                      
19,137
  
 
Pro forma adjustments include:
 
(i)          Add back to Other operating expenses for the portion of rent and facility costs currently incurred by Winthrop
 
3
 
WRIGHT INVESTORS' SERVICE HOLDINGS INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2017
(unaudited)
(in thousands, except per share amounts)
 
        
Winthrop
    
Pro Forma
    
Pro Forma
  
 
  
Historical
    
adjustment
    
adjustment
    
Statement
  
 
  
Consolidated
    
inc / (dec)
    
inc / (dec)
    
of Operations
  
Revenues
                        
Investment management services
  
$
2,213
    
$
(2,213
)
  
$
-
    
$
-
  
Other investment advisory services
    
2,387
      
(2,387
)
    
-
      
-
  
Financial research and related data
    
812
      
(812
)
    
-
      
-
  
 
    
5,412
      
(5,412
)
    
-
      
-
  
Expenses
                                
Compensation and benefits
    
3,364
      
(2,896
)
    
-
      
468
  
Other operating
    
3,338
      
(2,032
)
    
177
 (i)
    
1,483
  
 
    
6,702
      
(4,928
)
    
177
      
1,951
  
 
                                
Operating income
    
(1,290
)
    
(484
)
    
(177
)
    
(1,951
)
Interest expense and other income (loss),  net
    
(96
)
    
105
      
-
      
9
  
Loss before income taxes
    
(1,386
)
    
(379
)
    
(177
)
    
(1,942
)
Income tax benefit
    
96
      
-
      
-
      
96
  
Net loss
  
$
(1,290
)
  
$
(379
)
          
$
(1,846
)
Basic and diluted net loss per share
  
$
(0.07
)
                  
$
(0.10
)
 
                                
Weighted average common shares outstanding:
                                
 
                                
Basic and diluted
    
19,216
                      
19,216
  
 
Pro forma adjustments include:
 
(i)          Add back to Other operating expenses for the portion of rent and facility costs currently incurred by Winthrop
 
4
 
WRIGHT INVESTORS' SERVICE HOLDINGS INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2016
(unaudited)
(in thousands, except per share amounts)
 
 
        
Winthrop
    
Pro Forma
    
Pro Forma
  
 
  
Historical
    
adjustment
    
adjustment
    
Statement
  
 
  
Consolidated
    
inc / (dec)
    
inc / (dec)
    
of Operations
  
Revenues
                        
Investment management services
  
$
2,240
    
$
(2,240
)
  
$
-
    
$
-
  
Other investment advisory services
    
2,765
      
(2,765
)
    
-
      
-
  
Financial research and related data
    
706
      
(706
)
    
-
      
-
  
 
    
5,711
      
(5,711
)
    
-
      
-
  
Expenses
                                
Compensation and benefits
    
3,745
      
(3,322
)
    
-
      
423
  
Other operating
    
3,650
      
(2,341
)
    
177
 (i)
    
1,486
  
 
    
7,395
      
(5,663
)
    
177
      
1,909
  
 
                                
Operating income
    
(1,684
)
    
(48
)
    
(177
)
    
(1,909
)
Share of loss from Investment in LLC
    
(294
)
                    
(294
)
Interest expense and other income (loss),  net
    
(100
)
    
81
      
-
      
(19
)
Income (loss) before income taxes
    
(2,078
)
    
33
      
(177
)
    
(2,222
)
Income tax expense
    
(54
)
    
-
      
-
      
(54
)
Net income (loss)
  
$
(2,132
)
  
$
33
            
$
(2,276
)
Basic and diluted net loss per share
  
$
(0.11
)
                  
$
(0.12
)
 
                                
Weighted average common shares outstanding:
                                
 
                                
Basic and diluted
    
19,085
                      
19,085
  
 
Pro forma adjustments include:
 
(i)          Add back to Other operating expenses for the portion of rent and facility costs currently incurred by Winthrop
 
5
 
WRIGHT INVESTORS' SERVICE HOLDINGS INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS
For the three months ended March 31, 2018
(unaudited)
(in thousands)

 
        
Winthrop
    
Pro Forma
    
Pro Forma
  
 
  
Historical
    
adjustment
    
adjustment
    
Balance
  
 
  
Consolidated
    
inc / (dec)
    
inc / (dec)
    
Sheet
  
Assets
                        
Current assets
                        
Cash and cash equivalents
  
$
5,681
    
$
(638
)
  
$
6,000
 (i)
  
$
11,184
  
 
                    
141
 (ii)
        
Accounts receivable
    
161
      
(161
)
    
-
      
-
  
Income tax receivable
    
148
      
-
      
-
      
148
  
Prepaid expenses and other current assets
    
363
      
(287
)
    
-
      
76
  
Total current assets
    
6,353
      
(1,086
)
    
6,141
      
11,408
  
Property and equipment, net
    
87
      
(87
)
    
-
      
-
  
Intangible assets, net
    
1,519
      
(1,519
)
    
-
      
-
  
Goodwill
    
3,364
      
(3,364
)
    
-
      
-
  
Investment in undeveloped land
    
355
      
-
      
-
      
355
  
Other assets
    
108
      
(50
)
    
-
      
58
  
Total assets
  
$
11,786
    
$
(6,106
)
  
$
6,141
    
$
11,821
  
 
                                
Liabilities and stockholders’ equity
                                
Current liabilities
                                
Accounts payable and accrued expenses
  
$
628
    
$
(493
)
  
$
-
    
$
135
  
Deferred revenue
    
10
      
(10
)
    
-
      
-
  
Income taxes payable
    
43
      
(12
)
    
-
      
31
  
Due to parent
    
-
      
(141
)
    
141
 (ii)
    
-
  
Current portion of officers retirement bonus liability
    
165
      
(165
)
    
-
      
-
  
Total current liabilities
    
846
      
(821
)
    
141
      
166
  
 
                                
Officers retirement bonus liability, net of current portion
    
447
      
(447
)
    
-
      
-
  
Total liabilities
    
1,293
      
(1,268
)
    
141
      
166
  
 
                                
Stockholders’ equity
    
10,493
      
(4,838
)
    
6,000
 (iii)
    
11,655
  
 
                                
Total liabilities and stockholders’ equity
  
$
11,786
    
$
(6,106
)
  
$
6,141
    
$
11,821
  
 
Pro forma adjustments include:
 
(i)
Stock purchase price of $6 million
(ii)
Estimated amount owed by Winthrop to the Company, required to paid at closing
(iii)
Represents the increase in equity as a result of the sale of Winthrop
 
 
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