Attached files
| file | filename |
|---|---|
| EX-31.2 - EXHIBIT - SPECTRUM GROUP INTERNATIONAL, INC. | ex312spgz063013a.htm |
| EX-31.1 - EXHIBIT - SPECTRUM GROUP INTERNATIONAL, INC. | ex311spgz063013a.htm |
| EX-32.2 - EXHIBIT - SPECTRUM GROUP INTERNATIONAL, INC. | ex322spgz063013a.htm |
| EX-32.1 - EXHIBIT - SPECTRUM GROUP INTERNATIONAL, INC. | ex321spgz063013a.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
Or
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the transition period from to
Commission File Number: 1-11988
SPECTRUM GROUP INTERNATIONAL, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware (State of Incorporation) | 22-2365834 (IRS Employer I.D. No.) | |
Irvine, CA 92614
(Address of Principal Executive Offices) (Zip Code)
(949) 748-4800
__________________________________________________
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act: Common Stock, par value $0.01 per share
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No þ
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes o No þ
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes. þ No. o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes. þ No. o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (section 229.405 of this chapter) is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:
Large accelerated filer o | Accelerated filer o | Non-accelerated filer o (Do not check if a smaller reporting company) | Smaller reporting company þ |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ
As of December 31, 2012, the aggregate market value of the registrant's common stock held by non-affiliates of the registrant was approximately $23.4 million, based on the closing price of the registrant's common stock of $2.14 per share on December 31, 2012.
As of September 17, 2013, the registrant had 31,113,401 shares of Common Stock outstanding, par value $0.01 per share.
DOCUMENTS INCORPORATED BY REFERENCE
None.
CAUTIONARY STATEMENT PURSUANT TO THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This Annual Report on Form 10-K contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by the use of forward-looking terminology such as “believe,” “expect,” “may,” “will,” “should,” “seek,” “on-track,” “plan,” “project,” “forecast,” “intend” or “anticipate,” or the negative thereof or comparable terminology, or by discussions of vision, strategy or outlook. You are cautioned that our business and operations are subject to a variety of risks and uncertainties, many of which are beyond our control, and, consequently, our actual results may differ materially from those projected by any forward-looking statements. Factors that could cause our actual results to differ materially from those projected include, but are not limited to, those discussed under the heading captioned “Risk Factors,” and elsewhere in this Annual Report on Form 10-K. We make no commitment to revise or update any forward-looking statements in order to reflect events or circumstances after the date any such statement is made.
SPECTRUM GROUP INTERNATIONAL, INC.
FORM 10-K/A ANNUAL REPORT
For the Fiscal Year Ended June 30, 2013
Table of Contents
Page | |||
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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Set forth below is information regarding the directors and executive officers of the Company as of September 13, 2013.
Name | Age | Position(s) |
Jeffrey D. Benjamin | 52 | Chairman of the Board and Director |
Gregory N. Roberts | 51 | Chief Executive Officer, President and Director |
Paul Soth | 55 | Chief Financial Officer and Executive Vice President |
Carol Meltzer | 54 | Executive Vice President, General Counsel and Corporate Secretary |
Arthur Hamilton | 42 | Executive Vice President, Chief Accounting Officer |
Antonio Arenas | 58 | Director |
Jess M. Ravich | 56 | Director |
Joel R. Anderson | 69 | Director |
John U. Moorhead | 61 | Director |
Ellis Landau | 69 | Director |
William Montgomery | 53 | Director |
Jeffrey D. Benjamin, a director since May 2009 and Chairman of the Board (in a non-executive capacity) since September 27, 2012, has been a Senior Advisor to Cyrus Capital Partners, L.P. since 2008, where he assists with distressed investments. Mr. Benjamin also serves as a consultant to Apollo Management, L.P., a private investment fund, and from September 2002 to June 2008, Mr. Benjamin served as a senior advisor to Apollo Management, where he was responsible for a variety of investments in private equity, high yield and distressed securities. Mr. Benjamin is also a member of the Boards of Directors of Harrah's Entertainment, Inc., Exco Resources, Inc. and Virgin Media Inc., and is a trustee of the American Numismatic Society.
Gregory N. Roberts, a director since February 2000, has served as our President and Chief Executive Officer since March 2008. Mr. Roberts previously served as the President of the Company's North American coin division, which includes Spectrum Numismatics and A-Mark Precious Metals; Mr. Roberts had been President of Spectrum Numismatics since the early 1990s. He is also a lifetime member of the American Numismatics Association.
Paul Soth has served as our Chief Financial Officer and Executive Vice President since April 2010. Prior to that, Mr. Soth served as Director of Income Tax Processes and Systems for Harrah's Entertainment, Inc. from August 2009 until April 2010, and as Corporate Controller and Tax Manager for Fontainebleau Resorts from August 2006 to May 2009. Mr. Soth also served as Tax Manager of Mandalay Resort Group from August 1999 to April 2005. Mr. Soth graduated from California State University, San Marcos, with a B.S. in Business Administration - Accounting, and holds a M.S. in Accountancy from the University of Phoenix.
Carol Meltzer has served as our Chief Administrative Officer since March 2008, our Executive Vice President since May 2006, and our General Counsel since 2004, and has provided legal services to the Company since 1995. She previously practiced law at Stroock & Stroock & Lavan LLP and Kramer Levin Naftalis & Frankel LLP.
Arthur Hamilton has served as our Chief Accounting Officer and Executive Vice President since December 2010. Prior to joining the Company in May 2010, Mr. Hamilton served as Senior Manager, Internal Audit, for Franklin Templeton Investments from 2009 to May 2010, and as Internal Audit Manager from 2003 to 2006. Mr. Hamilton also served as Director of Internal Audit for MGM Resorts International from 2006 to 2008, and as Director of Compliance and Treasury for Fontainebleau Resorts, LLC. during 2008 and 2009. Mr. Hamilton received his B.S. in Accounting from the University of Baltimore and his M.B.A. from Northwestern University, Kellogg School of Management.
Antonio Arenas, a director since 2006, has served as our Executive Chairman from October 2007 to September 27, 2012. Mr. Arenas has been a Managing Director and the Chief Executive Officer of COALCA, S.A., a company involved in the sale and distribution of consumer and pharmaceutical products, and land development in the Canary Islands and mainland Spain, since 1994.
Jess M. Ravich, a director since December 2009, Mr. Ravich is group managing director and head of alternative products for The TCW Group, Inc., an international asset-management firm, which he joined in 2012. Prior to joining The TCW Group, Mr. Ravich served as a managing director and head of capital markets of Houlihan, Lokey, Howard & Zukin, Inc., an international investment bank. From 1991 through November 2009, Mr. Ravich founded and served as Chief Executive Officer of Libra Securities LLC, an investment banking firm serving the middle market. Prior to founding Libra, Mr. Ravich was an Executive Vice President of the fixed income department at Jefferies & Company, a Los Angeles based brokerage firm. Prior to Jefferies, Mr. Ravich was a Senior Vice President at Drexel Burnham Lambert, where he was also a member of the executive committee of the high-yield group. Mr. Ravich is a graduate of the Wharton School at the University of Pennsylvania, summa cum laude, and Harvard Law School, magna cum laude and editor of Law Review. Mr. Ravich serves on the Board of Directors of The Cherokee Group, Inc. (NASDAQ: CHKE).
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Joel R. Anderson, a director since October 2012, is the Chairman and Director of Anderson Media Corporation, the country’s largest distributor and merchandiser of pre-recorded music and a major distributor of books, and is also the Chairman and Director of various affiliated companies, including TNT Fireworks, the country’s largest importer and distributor of consumer fireworks; Anderson Press, a major publisher of children’s books and associated children’s product; and Whitman Publishing Company, the leading publisher of books and related products for coin collections. Mr. Anderson has served as Chairman and in other positions with Anderson Media Corporation for more than five years. Mr. Anderson has been a member of the Board of Trustees of the American Numismatic Society since 2006 and serves on its Nominating and Governance Committee. He is also a lifetime member of the American Numismatic Association. He is a principal of Stack’s LLC, the Company’s joint venture partner in Stack’s Bowers Galleries, its rare coin and currency coin auction house.
John (“Jay”) U. Moorhead, a director since June 2007, has been Managing Director of Ewing Bemiss & Co., an investment banking firm, since 2009. Prior to joining Ewing Bemiss, Mr. Moorhead was a managing director at Westwood Capital from 2005 until 2009 and MillRock Partners from 2003 until 2005, boutique investment banking firms serving private middle market and public growth companies. From 2001 to 2003, Mr. Moorhead was a corporate finance partner at C.E. Unterberg, Towbin.
Ellis Landau, a director since October 2012, is President, Treasurer and Director of ALST Casino Holdco, LLC, the holding company of Aliante Gaming, LLC, which owns and operates Aliante Station Casino + Hotel in Las Vegas, Nevada. From 2007 to 2011, Mr. Landau was a member of the Board of Directors of Pinnacle Entertainment, Inc. (NYSE:PNK), a leading gaming company. He served as Chairman of the Audit Committee and as a member of its Nominating and Governance Committee and its Compliance Committee. In 2006, Mr. Landau retired as Executive Vice President and Chief Financial Officer of Boyd Gaming Corporation (NYSE: BYD), a position he held since he joined the company in 1990. Mr. Landau previously worked for Ramada Inc., later known as Aztar Corporation, where he served as Vice President and Treasurer, as well as U-Haul International in Phoenix and the Securities and Exchange Commission in Washington, D.C. Mr. Landau received his Bachelor of Arts in economics from Brandeis University in 1965 and his M.B.A. in finance from Columbia University Business School in 1967.
William Montgomery has been a director since December 2012. He is a private investor with a focus on equities and real estate. Previously, he was Executive Vice President in charge of principal investments for Libra Securities from 1999-2000. Prior thereto, he was a Managing Director at Salomon Brothers Inc. At Salomon, he was a member of the fixed income arbitrage group from 1993 to 1998 and was responsible for proprietary investments in high yield securities. He was previously a member of the Investment Banking department (1986 – 1991) and a distressed debt trader (1991 -1992). He is a graduate of the University of Virginia (1982) and the Columbia University School of Law (1986).
There are no family relationships among any of the Company's directors or executive officers.
The Nominating and Corporate Governance Committee works with the Board to determine the appropriate characteristics, skills, and experiences for the Board as a whole and its individual members. The Board believes that its members must possess certain basic personal and professional qualities in order to properly discharge their fiduciary duties to stockholders, provide effective oversight of the management of the Company and monitor the Company's adherence to principles of sound corporate governance. In addition, in assessing the qualifications of each of the current Board members, the Board looks at such person's past commitment to the responsibilities as a director and his performance in discharging those responsibilities.
The specific credentials, experience and other qualifications of each of our directors to serve on our Board are as follows:
Mr. Benjamin's extensive financial background, demonstrated business acumen, service as a director for several well-known public companies, long-standing personal interest in coin collecting and role as trustee of the American Numismatic Society greatly benefits the Board as it addresses various corporate finance matters, governance concerns, business development and other policy-making issues. Mr. Benjamin, who holds an M.B.A, serves as Chairman of the Board.
Mr. Roberts is the Company's President and Chief Executive Officer and, through his day-to-day involvement in all aspects of the Company's operations, provides a vital link between junior and senior management personnel and the general oversight and policy-setting responsibilities of the Board. Mr. Roberts has substantial management and business experience in the area of collectibles and trading, having served as an officer of Spectrum Numismatics since the early 1990s and as President of A-Mark Precious Metals since 2005. Mr. Roberts has been a collector since the age of 12, and his expertise and knowledge of the industry is invaluable to the Board.
Mr. Arenas has a strong business leadership, financial management and strategic planning background, which has been a valuable asset to the Company as we have developed and implemented new global corporate and business strategies. Mr. Arenas, who is also a lawyer, was recommended for nomination to the Board by our majority shareholder, Afinsa Bienes Tangibles, S.A. En Liquidacion.
With his extensive background in investment banking and his degrees in business and law, Mr. Ravich frequently takes a central role in the Board's consideration of various strategic and business initiatives, including potential business combinations, as part of the planned growth and development of the Company. Mr. Ravich's contributions to the Board are both direct, through his knowledge, skills and policy-making abilities, and indirect, through his reputation in the industry.
Mr. Anderson’s extensive business experience with a family-owned national media conglomerate, coupled with his long-standing interest and expertise in numismatics, make him uniquely qualified to serve on our Board. Mr. Anderson provides critical insight and perspective as we develop strategies for growth, both internally and through acquisitions.
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As an investment banker, Mr. Moorhead brings valuable skills to bear on a variety of issues facing the Board, including corporate finance matters, competition in a global economy and other issues confronting public growth companies. Mr. Moorhead also has specialized knowledge and experience in the area of executive compensation, and serves as Chairman of our Compensation Committee.
Mr. Landau, who holds an M.B.A., has substantial finance and accounting experience, including serving as the Chief Financial Officer and as Chairman of the Audit Committee of two NYSE-listed companies. Mr. Landau serves as the Chairman of the Audit Committee, and qualifies as a “financial expert” for purposes of his service on that Committee. Mr. Landau's experience in the area of corporate governance is of value to the Board.
Mr. Montgomery brings to the Board expertise in investments, finance and capital markets, which the Company believes is particularly important as it seeks to establish a market presence following the distribution.
During the fiscal year ended June 30, 2013, George Lumby and Christopher W. Nolan, Sr. served on our Board of Directors. Mr. Lumby resigned from our Board of Directors in September 2012; Mr. Nolan declined to stand for re-election to the Board at the 2012 annual meeting of stockholders.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company's directors and executive officers, and persons owning more than 10% of a registered class of the Company's equity securities, to file with the SEC reports of their ownership of, and transactions in, the Company's common stock or other Company equity securities. To the Company's knowledge, based solely on a review of copies of such reports furnished to the Company and representations of directors and executive officers, with respect to the fiscal year ended June 30, 2013, all of such persons were in compliance with the applicable Section 16(a) reporting requirements other than two inadvertent late filings.
Code of Ethics
The Audit Committee of the Company's Board of Directors has adopted a Code of Ethics for Senior Financial and Other Officers (the “Code of Ethics”), which applies to the Company's Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, Controller and heads of major divisions, together with such other officers as the Audit Committee may from time to time designate. A copy of the Code of Ethics is filed as Exhibit 14 to this Form 10-K. The Company also has adopted a Code of Business Conduct and Ethics, which applies to directors, officers and employees generally, and a Code of Business Conduct and Ethics for the Board of Directors. To view these and other Spectrum corporate governance documents (including the Charters for the Audit Committee, the Nominating and Governance Committee, and the Compensation Committee, the Corporate Governance Guidelines, and the Procedures for Identifying and Evaluating Candidates for Director), you may also go to our Internet website located at www.spectrumgi.com and click on “Investor Relations” and then “Governance Policies.” You may also obtain a printed copy of the Code of Ethics, free of charge, by contacting us at the following address:
Spectrum Group International, Inc.
1063 McGaw
Irvine, California 92614
Telephone: (949) 748-4800
Audit Committee
The Company has a separately-designated standing Audit Committee established in accordance with section 3(a)(58)(A) of the Exchange Act. The Audit Committee comprises four members: Ellis Landau (Chairman), John U. Moorhead, Jess M. Ravich and William Montgomery. The Company's Board of Directors has determined that each member of the Audit Committee is “independent” (as that term is currently defined in Rule 5605(c)(2) of the NASDAQ listing standards) and that Mr. Landau qualifies as an “audit committee financial expert,” as defined in accordance with applicable SEC rules.
Information regarding the Nominating and Governance Committee and the Compensation Committee appears in Item 13 below.
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ITEM 11. EXECUTIVE COMPENSATION
The table below sets forth the compensation of the Company's named executive officers for both fiscal 2013 and fiscal 2012. “Named executive officers” includes our President and Chief Executive Officer, Mr. Roberts, our Chief Financial Officer, Mr. Soth, our Chief Accounting Officer, Mr. Hamilton. During 2012 the Company's named executive officers included Mr. Arenas, who served as Executive Chairman during those periods. He was no longer a named executive officer for fiscal 2013.
Summary Compensation Table - Fiscal 2013 and 2012
Name and Principal Position | Year | Salary ($) | Bonus ($)(1) | Stock Awards($)(2) | Non-Equity Incentive Plan Compensation ($)(3) | All Other Compensation ($)(4) | Total ($) | |||||||||||||
(a) | (b) | (d) | (e) | (e) | (f) | (h) | (i) | |||||||||||||
Gregory Roberts | 2013 | $ | 525,000 | $ | 335,500 | $ | 535,684 | $ | 837,240 | $ | 37,244 | $ | 2,270,668 | |||||||
Chief Executive Officer | 2012 | $ | 525,000 | $ | — | $ | — | $ | 950,000 | $ | 38,372 | $ | 1,513,372 | |||||||
President and Director | ||||||||||||||||||||
Paul Soth | 2013 | $ | 212,500 | $ | 160,500 | $ | 21,525 | $ | — | $ | 12,649 | $ | 407,174 | |||||||
Chief Financial Officer | 2012 | $ | 200,000 | $ | 125,000 | $ | — | $ | — | $ | 10,906 | $ | 335,906 | |||||||
Executive Vice President | ||||||||||||||||||||
Arthur Hamilton | ||||||||||||||||||||
Chief Accounting Officer | 2013 | $ | 229,990 | $ | 35,500 | $ | — | $ | — | $ | 8,655 | $ | 274,145 | |||||||
Executive Vice President | 2012 | $ | 210,000 | $ | 25,000 | $ | — | $ | — | $ | 87,594 | $ | 322,594 | |||||||
(1) | For named executive officers other than Mr. Roberts, bonuses for fiscal 2013 primarily were discretionary bonuses awarded by the Compensation Committee or Board of Directors based on its year-end assessment of the level of achievement of Company-wide and individual goals and performance. For fiscal 2013, each of the named executive officers also received a $500 holiday bonus paid to employees. For Mr. Roberts, the fiscal 2013 bonus amount shown in this column included $275,000 awarded upon his signing of a renewal of his employment agreement with the Company and $60,000 awarded by the Compensation Committee as a discretionary year-end bonus. |
(2) | The stock-based compensation amounts reported in the “Option Awards” column represent the aggregate grant-date fair value of the options granted by us and computed in accordance with FASB ASC Topic 718 (but with no adjustment for the effect of estimated forfeitures based on service-based vesting conditions). Assumptions used in the calculation of these amounts are discussed in Note 16 to our consolidated audited financial statements for the fiscal year ended June 30, 2013, contained in the original filing of this Form 10-K. We granted to Mr. Roberts options to purchase 300,000 shares of SGI common stock on February 15, 2013, exercisable at the following exercise prices: 100,000 options exercisable at $2.50 per share; 100,000 options exercisable at $3.00 per share; and 100,000 options exercisable at $3.50 per share. The options were vested upon grant, and have a stated term of ten years, subject to accelerated vesting and early expiration of the term in specified circumstances. |
(3) | Mr. Roberts was granted an award opportunity for fiscal 2013 which constitutes a non-equity incentive compensation plan award. The amount shown in this column is the amount paid out as the annual incentive award. Bonus and equity incentive plan compensation for the named executive officers, including the definition of “pre-tax profits” for purposes of Mr. Roberts’ annual incentive award, are described in greater detail below under the caption “Employment Agreements and Employment Terms.” |
(4) | Amounts in this column, for fiscal 2013, are as follows: |
◦ | Mr. Roberts received $9,000 as a car allowance, $6,728 as a 401(k) matching contribution, and $21,517 as a cash payment in lieu of vacation time. |
◦ | Mr. Soth received $2,013 as a 401(k) matching contribution and $10,637 as a cash payment in lieu of vacation time. |
◦ | Mr. Hamilton received $8,655 as a cash payment in lieu of vacation time. |
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Employment Agreements and Employment Terms
Compensation for our Chief Executive Officer for fiscal 2013 was governed by an employment agreement, but our other named executive officers did not have employment agreements in effect for fiscal 2013.
The principal terms of the employment of our named executive officers were as follows:
Greg Roberts: Mr. Roberts is employed as our Chief Executive Officer and President under his employment agreement. The agreement, originally entered into in December 2007, was amended during fiscal 2013 to extend the term until June 30, 2016. The employment agreement provides that Mr. Roberts will be nominated to serve as a director during its term.
The employment agreement as in effect for fiscal 2013 provided for a base salary of $525,000 per year. The employment agreement also provides to Mr. Roberts an opportunity to earn a performance bonus in each fiscal year. As in effect in fiscal 2013 (and providing for the same terms for fiscal 2014), the performance bonus was based on pre-specified percentages of our pre-tax profits. For this purpose, pre-tax profits is defined as the Company's net income (as determined under Generally Accepted Accounting Principles or GAAP) for the given fiscal year, adjusted as follows:
• | The positive or negative effects of income taxes (in accordance with GAAP) are eliminated from net income in determining pre-tax profits. |
• | The positive or negative effects of foreign currency exchange are eliminated. |
• | Expenses incurred in connection with specified litigation relating to Afinsa are eliminated. |
If pre-tax profits are at least $5 million, then the annual incentive will equal:
• | 12% of pre-tax profits up to $8 million of pre-tax profits; plus |
• | 15% of pre-tax profits in excess of $8 million, up to $10 million of pre-tax profits; plus |
• | 18% of pre-tax profits in excess of $10 million of pre-tax profits. |
The payout amount for this performance bonus for fiscal 2013 was calculated as $837,240, reflected in the Summary Compensation Table above in the column captioned “Non-Equity Incentive Plan Compensation.” In addition to the performance bonus, the Company may pay a discretionary bonus per the terms of the employment agreement. For fiscal 2013, the Compensation Committee awarded a discretionary bonus of $60,000 to Mr. Roberts.
The employment agreement provides for indemnification of Mr. Roberts for liabilities arising out of his employment, and provides a motor vehicle allowance of $750 per month.
In connection with the amendment to Mr. Roberts’ employment agreement in fiscal 2013, we paid a signing bonus of $275,000 and granted stock options to Mr. Roberts. The options, which were granted February 15, 2013, are exercisable for the following numbers of shares at the following exercise prices: 100,000 options exercisable at $2.50 per share; 100,000 options exercisable at $3.00 per share; and 100,000 options exercisable at $3.50 per share. At the date of grant, the closing market price of our common stock was $2.18 per share, so the exercise prices of the options represented a premium over the market price at the grant date. The options were vested upon grant, and have a stated term of ten years, subject to accelerated vesting and early expiration of the term in specified circumstances. The grant date fair value of the options is reflected in the Summary Compensation Table in the “Options” column for fiscal 2013.
Under Mr. Roberts' amended employment agreement, if Mr. Roberts' employment is terminated by us without cause or by him for “Good Reason,” or if his employment terminates due to death or disability, we will be obligated to continue to pay to him (i) a pro rata portion (based on the number of days during the year of termination that Mr. Roberts was employed) of his annual incentive for that year, based on actual performance achieved for the full year, and (ii) a lump sum severance payment equal to the greater of $1,500,000 or 75% of defined “annualized pay.” For this purpose, “annualized pay” is calculated as one-third of the sum of the salary payments during the 36 months preceding termination plus annual incentives earned for the preceding three completed fiscal years. In the case of death or disability, the severance payment will be reduced by the amount of any proceeds paid to Mr. Roberts or his estate, as the case may be, from any disability or life insurance policy maintained by us for the benefit of Mr. Roberts. “Good Reason” would arise if we decrease or fail to pay salary or bonus required under the agreement, or if Mr. Roberts ceased to be President and CEO of Spectrum or his duties were materially diminished, or his place of employment were relocated by more than 30 miles, provided that Mr. Roberts must give notice that Good Reason has arisen and we have an opportunity to cure the circumstances that gave rise to Good Reason.
The employment agreement obligates Mr. Roberts not to solicit employees or customers of the Company in ways harmful to our business during the period in which severance is payable or for one year following a termination for cause. The employment agreement also provides for certain benefits, including medical insurance, vacation, reimbursement of business expenses and payment of previously earned compensation upon any termination of employment.
Paul Soth: Mr. Soth commenced employment as our Chief Financial Officer and Executive Vice President on April 8, 2010. At the time he commenced employment, we agreed that Mr. Soth will receive a base salary of $200,000 per annum, plus a $25,000 non-accountable expense
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allowance to cover moving expenses. We also agreed that he would be eligible for discretionary bonuses awarded by the Compensation Committee or Board of Directors based on its year-end assessment of the level of achievement of Company-wide and individual goals. At April 8, 2010, we granted 30,000 restricted stock units to Mr. Soth, vesting 50% on May 1, 2011 and 50% on May 1, 2012. On July 1, 2013 (during fiscal 2014), we granted 75,000 restricted stock units to Mr. Soth, vesting 100% on June 30, 2015, subject to accelerated vesting in specified circumstances.
For fiscal 2013, we granted a bonus of $160,000 to Mr. Soth. This bonus was discretionary, based on the Compensation Committee's subjective evaluation of Mr. Soth's performance in fiscal 2013. The Company expects that any bonus payable for fiscal 2014 performance likewise would be a discretionary bonus based on the Committee's year-end review of Company results and Mr. Soth's performance.
Arthur Hamilton: Mr. Hamilton commenced employment in May 2010 and became Chief Accounting Officer and Executive Vice President during December 2010. At the time he commenced employment, we agreed that Mr. Hamilton will receive a salary of $165,000 per year plus a $35,000 non-accountable expense allowance to cover moving expenses. We also agreed that he would be eligible for discretionary bonuses awarded by the Compensation Committee or Board of Directors based on its year-end assessment of the level of achievement of Company-wide and individual goals and performance.
For fiscal 2013, we granted a bonus of $35,000 to Mr. Hamilton. This bonus was discretionary, based on the Compensation Committee’s subjective evaluation of Mr. Hamilton’s performance in fiscal 2013. The Company expects that any bonus payable for fiscal 2014 likewise would be a discretionary bonus based on the Committee’s year-end review of Company results and Mr. Hamilton’s performance.
Retirement Plans: The only retirement plan in which the named executive officers participate is our 401(k) plan, open to all employees. Employees are permitted to elect to contribute up to $17,000 (or, in certain cases, $22,500) of their compensation. We provide a 30% matching contribution under the plan without any limit for each employee. Matching contributions to our named executive officers for fiscal 2013 are reflected in the “All Other Compensation” column of the Summary Compensation Table above.
The following table sets forth information regarding stock awards, stock options and similar equity compensation outstanding at June 30, 2013:
Outstanding Equity Awards At Fiscal Year-End - Fiscal 2013 | ||||||||||||||||||
Options Awards | Stock Awards | |||||||||||||||||
Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested (1) (#) | ||||||||||||
(a) | (b) | (c) | (e) | (f) | (g) | (h) | ||||||||||||
Gregory Roberts | 22,500 | — | $14.22 | 3/31/2014 | — | — | ||||||||||||
Chief Executive Officer | 22,500 | — | $2.80 | 7/31/2013 | — | — | ||||||||||||
President and Director | 100,000 | — | $2.50 | 2/15/2023 | — | — | ||||||||||||
100,000 | — | $3.00 | 2/15/2023 | — | ||||||||||||||
100,000 | — | $3.50 | 2/15/2023 | — | ||||||||||||||
Paul Soth | — | — | — | — | — | — | ||||||||||||
Chief Financial Officer | ||||||||||||||||||
Executive Vice President | ||||||||||||||||||
Arthur Hamilton | — | — | — | — | — | — | ||||||||||||
Chief Accounting Officer | ||||||||||||||||||
Executive Vice President | ||||||||||||||||||
(1) Values are based on based on the June 30, 2013 closing price of our common stock in the over-the-counter market, $2.25 per share.
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Directors' Compensation
Under our Outside Directors' Compensation Policy as in effect for fiscal 2013, each director who was not an executive officer or employee or other service provider to the Company (an “outside director”) was entitled to receive the following compensation for the fiscal year:
• | A cash retainer of $31,000; |
• | An awards of restricted stock units having a grant-date fair value of $38,000; |
• | A cash retainer of $5,000 for serving on a committee of the Board; |
• | A cash retainer of $15,000 for serving on the special committee of the Board overseeing negotiations with Afinsa. Additional compensation may be paid quarterly as warranted based on an evaluation of time spent (excluding travel time), activity level and results achieved; |
• | A cash retainer of $5,000 for serving as chairman of a regular Board committee or the special committee; |
• | No meeting fees for the first six Board meetings occurring during the year, but a meeting fee of $1,000 in cash for any additional Board meeting attended and for each committee meeting attended (reduced to $500 in the case of a telephonic meeting lasting one hour or less; excludes meetings of the special committee). |
Directors are also entitled to the protection of certain indemnification provisions in our certificate of incorporation and bylaws.
During fiscal 2013, the Board, upon the recommendation of its Compensation Committee and after consultation with the Committee’s independent compensation consulting firm, revised the compensation policy so that, beginning in fiscal 2014, annual compensation of each non-executive director will be as follows:
• | Cash retainer -- $60,000 |
• | Cash retainer for service as Chairman of Audit Committee or Chairman of Compensation Committee -- $10,000 |
• | Cash retainer for service as Chairman of Nominating and Governance Committee -- $5,000 |
• | Cash retainer for service as member (other than Chairman) of Audit Committee or Compensation Committee -- $5,000 |
No meeting fees will be paid. Service as a member of a committee other than the Audit Committee or Compensation Committee will not result in additional compensation. The Company’s policy regarding reimbursement of a director’s reasonable travel expenses for attending meetings remains in effect.
No equity awards are authorized as regular annual non-executive director compensation. The Chairman of the Board receives no additional cash compensation under this policy (however, the cash retainer payable to each non-employee director remains payable). To compensate the Chairman of the Board for service in that capacity, he was granted a stock option on October 25, 2012, covering 500,000 shares exercisable at the closing price of our common stock on the grant date, vesting in equal annual installments over five years, and expiring after ten years, subject to accelerated vesting and earlier expiration in specified circumstances.
This new policy became effective July 1, 2013 (except with regard to the stock option grant to the Chairman), at which time the Policy replaced our previous Outside Director Compensation Policy. The Board of Directors retains authority to pay compensation in place of or in addition to compensation items authorized under the new policy, and to amend, suspend or terminate the policy at any time.
In fiscal 2010, the Board adopted director ownership guidelines requiring outside directors to hold stock worth three times the annual cash retainer amount by the later of three years after the policy implementation date (May 2009) or three years after his or her initial election to the Board, and five times the annual cash retainer within five years after the later of the policy implementation date or his or her initial election to the Board. In fiscal 2013, the Board determined that a fixed policy regarding committee chairmanship rotation, implemented in fiscal 2010, placed an unnecessary restriction on its ability to appoint committee members, and therefore the Board determined to discontinue that policy.
The following table sets forth information regarding compensation earned by outside directors of the Company during fiscal 2013, as well as by George Lumby. Mr. Lumby was a member of our Board of Directors during the year until his resignation on September 25, 2012. However, he received compensation for services rendered to the Company as co-administrator of the Company's Spanish subsidiary CdC rather than directly for service as a director. The table shows the compensation to Mr. Lumby in all capacities. Mr. Arenas served as our Executive Chair during the year until September 27, 2012, and thereafter remained a director. Mr. Nolan served as a director during fiscal 2013 through December 13, 2012, the date of our annual meeting of stockholders.
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Name | Fees Earned or Paid in Cash ($) | Stock Awards ($) (1) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | Nonqualified Deferred Compensation Earnings | All Other Compensation ($)(2)(4) | Total ($) | ||||||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | ||||||||||||||
Jeffrey D. Benjamin | $ | 55,500 | $ | 38,001 | $ | 802,417 | $ | — | $ | — | $ | — | $ | 895,918 | |||||||
John Moorhead | $ | 65,250 | $ | 38,001 | $ | — | $ | — | $ | — | $ | — | $ | 103,251 | |||||||
Ellis Landau | $ | 33,250 | $ | 28,501 | $ | — | $ | — | $ | — | $ | — | $ | 61,751 | |||||||
Christopher W. Nolan, Sr. | $ | 52,500 | $ | 38,001 | $ | — | $ | — | $ | — | $ | — | $ | 90,501 | |||||||
Jess M. Ravich | $ | 55,750 | $ | 38,001 | $ | — | $ | — | $ | — | $ | — | $ | 93,751 | |||||||
Joel Anderson | $ | 27,750 | $ | 28,501 | $ | — | $ | — | $ | — | $ | — | $ | 56,251 | |||||||
William Montgomery | $ | 24,500 | $ | 20,583 | $ | — | $ | — | $ | — | $ | — | $ | 45,083 | |||||||
Antonio Arenas | $ | — | $ | 105,502 | $ | 105,502 | |||||||||||||||
George Lumby | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 20,157 | $ | 20,157 | |||||||
(1) | The stock-based compensation amounts reported in the “Stock Awards” column represent the aggregate grant-date fair value of the awards granted in fiscal 2012 and computed in accordance with FASB ASC Topic 718. Fair value of a stock award denominated in shares at the grant date is the number of such shares or units times the closing price of a share on the date of grant (excluding the effect of estimated forfeitures based on service-based vesting conditions). On August 16, 2012, Messrs. Benjamin, Moorhead, Nolan and Ravich each received a grant of 19,792 restricted stock units. On December 13, 2013, Messrs. Anderson and Landau each received a grant of 16,102 restricted stock units, and Mr. Montgomery received a grant of 11,629 restricted stock units. All of these restricted stock units became vested and non-forfeitable on June 30, 2013. |
(2) | The stock-based compensation amount reported in the “Option Awards” column represents the aggregate grant-date fair value of the options granted by the Company and computed in accordance with FASB ASC Topic 718 (but with no adjustment for the effect of estimated forfeitures based on service-based vesting conditions). Assumptions used in the calculation of these amounts are discussed in Note 16 to our consolidated audited financial statements for the fiscal year ended June 30, 2013, contained in the original filing of this Form 10-K. We granted to Mr. Benjamin options to purchase 500,000 shares of our common stock on October 25, 2012, exercisable at $2.00 per share. The options will vest 20% per year on the anniversary of the grant date, and have a stated term of ten years, subject to accelerated vesting and early expiration of the term in specified circumstances. |
(3) | Mr. Arenas served as our Executive Chairman through September 25, 2013, and continued thereafter as a director. For fiscal 2013, he also served as co-administrator of the Company's Spanish subsidiary Central de Compras Coleccionables, S.L. (“CdC”). We paid compensation for Mr. Arenas' services in fiscal 2013 to a corporation he controls, in the form of cash fees totaling $105,502. The Compensation Committee and Board retained discretion to award an annual bonus to Mr. Arenas, but no bonus was paid for fiscal year 2013. Mr. Arenas' service was not a full-time commitment, but he was required to account for his hours of service. |
(4) | We paid Mr. Lumby an annual fee equal to 150,000 euros for his services on behalf of the Company's Spanish subsidiary, CdC, subject to adjustment depending on hours worked. Mr. Lumby's fee for the portion of fiscal 2013 worked was 26,083 euros. For purposes of the table, Mr. Lumby’s compensation was converted into U.S. dollars at the rate of 1.294 U.S. dollars to the euro, the average exchange rate for the year. Mr. Lumby's service was not a full-time commitment. He was not separately compensated for his service on the Board of Directors. Mr. Lumby resigned from our Board of Directors on September 25, 2012. |
The listing below shows total ownership of the Company's common stock by each of the Company's non-executive directors as of June 30, 2013, in each case including shares issuable in settlement of the restricted stock units that became vested at June 30, 2013 but excluding shares underlying then outstanding options:
Jeffrey D. Benjamin owned 2,965,556 shares as of June 30, 2013
John Moorhead owned 73,119 shares as of June 30, 2013
Jess M. Ravich owned 1,028,906 shares as of June 30, 2013
William Montgomery owned 994,650 shares as of June 30, 2013
Ellis Landau owned 716,102 shares as of June 30, 2013
Joel Anderson owned 1,218,214 shares as of June 30, 2013
At June 30, 2013, each non-executive director met the applicable stock ownership guideline, as described above.
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Principal Stockholders of the Company
The table below shows certain information regarding the “beneficial ownership” of shares of our common stock by any person who reported being a beneficial owner of more than 5% of the outstanding class of common stock as of September 17, 2013. Persons and groups that beneficially own in excess of 5% of our common stock are required to file certain reports with the Company and with the Securities and Exchange Commission regarding such beneficial ownership.
For purposes of the table below and the table set forth under “Beneficial Stock Ownership of Management,” a person is deemed to be the beneficial owner of any shares of common stock (1) over which the person has or shares, directly or indirectly, voting or investment power, or (2) of which the person has a right to acquire beneficial ownership at September 17, 2013 or at any time within 60 days thereafter. “Voting Power” is the power to vote or direct the voting of shares and “investment power” includes the power to dispose or direct the disposition of shares. We obtained the information provided in the following table from filings with the SEC and from representations made by the persons listed below. The number of shares beneficially owned as shown in the tables below may have been reported as of a date earlier than September 17, 2013, in which case the date of such information is provided in a footnote (all percentage calculations are as of September 17, 2013).
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percent of Common Stock (1) | ||||
William Richardson (2) | 4,050,918 | 13.0% | ||||
Gregory N. Roberts (3) | 3,938,080 | 12.7% | ||||
Jeffrey D. Benjamin (4) | 3,465,556 | 11.1% | ||||
Afinsa Bienes Tangibles, S.A (5) | 3,032,271 | 9.7% | ||||
Joel R. Anderson (6) Charles C. Anderson, Harold Anderson | 2,908,068 | 9.3% | ||||
(1) | This percentage has been calculated based upon 31,113,401 shares of the Company's common stock outstanding as of September 17, 2013, and such calculations were made in accordance with Rule 13d-3(d)(1)(i) under the Exchange Act. |
(2) | Beneficial ownership of William A. Richardson is based on his amended Schedule 13D filed with the SEC reporting beneficial ownership of our common stock at December 28, 2012. His beneficial ownership of our common stock totaled 4,050,918 shares at September 17, 2013, including 3,115,755 shares owned directly by Silver Bow Ventures LLC (10.0% of the outstanding class) as to which Mr. Richardson shares voting and dispositive power with Gregory N. Roberts. The address of Mr. Richardson and Silver Bow Ventures LLC is 1063 McGaw Avenue, Irvine, CA 92614. |
(3) | Beneficial ownership of Gregory N. Roberts is based on his advice to the Company regarding his beneficial ownership of our common stock. His beneficial ownership of our common stock totaled 3,938,080 shares at September 17, 2013, including 499,825 shares as to which Mr. Roberts shares voting and dispositive power with his wife; 3,115,755 shares owned directly by Silver Bow Ventures LLC (10.0-% of the outstanding class) as to which Mr. Roberts shares voting and dispositive power with William Richardson; and 322,500 shares issuable to Mr. Roberts upon exercise of currently exercisable options, as to which Mr. Roberts has sole voting and sole dispositive power. The address of Mr. Roberts is 1063 McGaw Avenue, Irvine, CA 92614. |
(4) | Beneficial ownership of Jeffrey D. Benjamin is based on his Schedule 13D filed with the SEC reporting beneficial ownership of shares of our common stock at September 17, 2012 and additional advice provided to the Company. His beneficial ownership of our common stock totals 3,065,556 shares, including 100,000 shares underlying options that will become exercisable October 25, 2013. Such beneficial ownership as shown in this table includes 1,000,000 shares held in a family trust as to which Mr. Benjamin neither has nor shares voting or dispositive power, as to which shares he disclaims beneficial ownership. Such beneficial ownership excludes 400,000 shares underlying options that are not currently exercisable and will not become exercisable within 60 days. The address of Mr. Benjamin is 1063 McGaw Avenue, Irvine, CA 92614. |
(5) | Beneficial ownership of Afinsa Bienes Tangibles, S.A. en Liquidacion (“Afinsa”) is based on its amended Schedule 13D filed with the SEC reporting beneficial ownership of Company common stock September 25, 2012. Afinsa reported beneficial ownership of 3,032,270 shares of our common stock, including 44,164 shares held directly and 2,988,106 shares (9.6% of the outstanding class) held through its wholly owned subsidiary, Auctentia, S.L. (“Auctentia”). Auctentia's address is Lagasca 88, 28001 Madrid, Spain. Based on Afinsa and Auctentia’s Schedule 13D, as amended, Afinsa had sole voting power and sole dispositive power over 44,164 shares of our common stock, and Afinsa and Auctentia had shared voting power and shared dispositive power over 2,988,106 shares of our common stock. |
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(6) | Beneficial ownership of Joel R. Anderson, Charles C. Anderson and Harold Anderson is based on their Schedule 13D filed with the SEC reporting their beneficial ownership, as a group, at September 25, 2012 and additional advice provided to the Company by Joel R. Anderson. Based on such information, the group’s beneficial ownership of our common stock totaled 2,908,068 shares at September 17, 2013, of which Joel R. Anderson had beneficial ownership of 1,218,214 shares, Charles C. Anderson had beneficial ownership of 1,465,354 shares and Harold Anderson had beneficial ownership of 224,500 shares. The address of Joel R. and Charles C. Anderson is 202 North Court Street, Florence, Alabama 35630, and the address of Harold Anderson is 3101 Clairmont Road, Suite C, Atlanta, GA 30329. |
Beneficial Stock Ownership of Management
The following table shows the number of shares of common stock beneficially owned as of September 17, 2013, by each director then serving in office, nominee for director (none at that date) and executive officer named in the Summary Compensation Table, and by the current directors and executive officers of the Company as a group.
Name of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percentage of Common Stock (1) | |||
Gregory N. Roberts (2) | 3,938,080 | 12.7% | |||
Jeffrey D. Benjamin (3) | 3,465,556 | 11.1% | |||
Joel R. Anderson, Charles C. Anderson, Harold Anderson (4) | 2,908,068 | 9.3% | |||
Jess M. Ravich (6) | 1,028,906 | 3.3% | |||
William Montgomery (5) | 994,650 | 3.2% | |||
Ellis Landau | 716,102 | 2.3% | |||
John U. Moorhead | 73,119 | * | |||
Paul Soth | 23,564 | * | |||
Arthur Hamilton | — | * | |||
Carol Meltzer | — | * | |||
All Executive Officers and Directors, as a group (6) | 13,148,045 | 42.3% | |||
*Less than one percent
(1) | The percentages have been calculated based upon 31,113,401 shares of the Company's common stock outstanding as of September 17, 2013, and such calculations were made in accordance with Rule 13d-3(d)(1)(i) under the Exchange Act. |
(2) | See footnote (3) to the table under the caption “Beneficial Ownership of Principal Stockholders of the Company” above. |
(3) | See footnote (4) to the table under the caption “Beneficial Ownership of Principal Stockholders of the Company” above. |
(4) | See footnote (6) to the table under the caption “Beneficial Ownership of Principal Stockholders of the Company” above. |
(5) | Includes 710,980 shares held in a trust as to which Mr. Montgomery has no voting power and limited dispositive power, and as to which shares Mr. Montgomery disclaims beneficial ownership. |
(6) | Includes 475,000 shares underlying options that are currently exercisable or become exercisable within 60 days, but excludes 430,000 shares underlying options that are not currently exercisable and will not become exercisable within 60 days and excludes 75,000 shares underlying RSUs that will not vest and be settled within 60 days. |
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The Company’s Board of Directors has determined that the following members of the Board of Directors qualify as “independent” as that term is currently defined in Rule 5605(a)(2) of the Nasdaq listing standards: Mr. Benjamin, Mr. Landau, Mr. Montgomery, Mr. Moorhead and Mr. Ravich,
Information regarding the Audit Committee and the independence of its members is incorporated into this item by reference to such information set forth in Item 10 above. The Board also has a Compensation Committee and a Nominating and Corporate Governance Committee. Messrs. Moorhead, Landau and Ravich serve on the Compensation Committee. Messrs. Ravich, Montgomery and Moorhead serve on the Nominating and Governance Committee.
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Transactions with Directors and Officers
From time to time certain of the Company's officers and directors may purchase from or consign collectibles to the Company. Each purchase
and consignment is made under substantially the same conditions that are applicable to third parties. During the years ended June 30, 2013 and 2012, the Company's officers and directors purchased from and sold to the Company bullion and numismatic products totaling $2.9 million and $1.4 million respectively.
Securities Purchase Agreement
On September 25, 2012, the Company purchased from Afinsa and Auctentia a total of 15,609,796 shares of common stock, as a result of which the combined holdings of Afinsa and Auctentia was reduced from 57% to 9.9% of the Company's common stock outstanding. In addition, the Company purchased from Auctentia 20% of the shares of the Company's subsidiary Spectrum PMI, Inc., which is the holding company for the Company's A-Mark Precious Metals, Inc. trading subsidiary. As a result, Spectrum PMI is now wholly owned by the Company. The purchase of the securities was pursuant to a Securities Purchase Agreement, dated March 5, 2012, as amended, among the Company, Afinsa and Auctentia, and the aggregate purchase price, including interest and other charges, was $51.18 million. The purchase price was funded through the proceeds of a rights offering and private placement of shares of common stock, which also closed on September 25, 2012, as well as the Company's cash on hand, resulting in a net impact to working capital of $25.6 million in cash and cash equivalents. The Company sold 12,004,387 shares in the rights offering at a price of $1.90 per share, for aggregate proceeds of $22.31 million, and 1,426,315 shares in the private placement at a price of $1.90 per share, for aggregate proceeds of $2.70 million. In connection with the purchase of the securities from Afinsa and Auctentia, and in accordance with the terms of the Securities Purchase Agreement, George Lumby, a representative of Afinsa, resigned from the Company's board of directors. Antonio Arenas, Afinsa's other representative on the board, resigned his position as executive chairman, but remains a director of the Company. As provided in the Securities Purchase Agreement, Mr. Arenas will resign from the board when Afinsa and Auctentia collectively cease to hold at least 5% of the Company's common stock. The Company agreed in the Securities Purchase Agreement agreed to use its reasonable commercial efforts to assist Afinsa and Auctentia to sell their remaining shares of common stock in an orderly manner that will be non-disruptive to the public market for the common stock and that is intended to facilitate a sale at prices acceptable to Afinsa and Auctentia.
As of June 30, 2013, there are outstanding 30.9 million shares of common stock, of which 3.0 million shares are owned by Afinsa and Auctentia. Accordingly, Afinsa and Auctentia may be deemed to no longer control the Company.
Other Transactions with Afinsa
On June 27, 2011, the Company and Afinsa entered into a consignment agreement to auction philatelic materials owned by Afinsa. Under the
terms of the consignment agreement, Heinrich Köhler Auktionshaus GmbH and Heinrick Köhler Briefmarkenhandel acted as the auctioneer for the sale of the philatelic materials owned by Afinsa. During the year ended June 30, 2012, Heinrich Köhler Auktionshaus GmbH and Heinrich Köhler Briefmarkenhandel earned $130,000 in related auction commissions.
During the year ended June 30, 2012, Afinsa consigned to Stack's-Bowers numismatic materials, which were sold at auction for $2.7 million.
The Company earned $0.3 million in related auction commission.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Fees | 2013 | 2012 | ||||||
Audit (1) | $ | 675,000 | $ | — | ||||
(1) | Audit fees consisted of services rendered by the principal accountant for the audit and reviews of our annual and quarterly consolidated financial statements. Amounts disclosed only include the fees of KPMG LLP, our principal accountant for the current fiscal year ending June 30, 2013. |
In accordance with the Sarbanes-Oxley Act of 2002, the Audit Committee established policies and procedures under which all audit and non-audit services performed by the Company's principal accountants must be approved in advance by the Audit Committee. As provided in the Sarbanes-Oxley Act, all audit and non-audit services must be pre-approved by the Audit Committee in accordance with these policies and procedures. KPMG, LLP did not provide any non-audit services during the fiscal year 2013.
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PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS SCHEDULES
(a) | The following documents are filed as part of this report: |
1. | Financial Statements |
The information called for by this item is incorporated herein by reference to pages F-1 through F-46 of this report.
2. | Financial Statements Schedules |
None
3. | Exhibits required to be filed by Item 601 of Regulation S-K |
The information called for by this item is incorporated herein by reference to the Exhibit Index in this report.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Date: | October 28, 2013 | SPECTRUM GROUP INTERNATIONAL, INC. | |||
By: | /s/ Gregory N. Roberts | ||||
Name: | Gregory N. Roberts | ||||
Title: | President and Chief Executive Officer | ||||
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Signatures | Title(s) | Date |
/s/ Jeffrey D. Benjamin | Chairman of the Board | October 28, 2013 |
Jeffrey D. Benjamin | ||
/s/ Gregory N. Roberts | President, Chief Executive Officer and Director | October 28, 2013 |
Gregory N. Roberts | (Principal Executive Officer) | |
/s/ Paul Soth | Chief Financial Officer and Executive Vice President | October 28, 2013 |
Paul Soth | (Principal Financial Officer) | |
/s/ Antonio Arenas | Director | October 28, 2013 |
Antonio Arenas | ||
/s/ Jess M. Ravich | Director | October 28, 2013 |
Jess M. Ravich | ||
/s/ Joel R. Anderson | Director | October 28, 2013 |
Joel R. Anderson | ||
/s/ John U. Moorhead | Director | October 28, 2013 |
John U. Moorhead | ||
/s/ Ellis Landau | Director | October 28, 2013 |
Ellis Landau | ||
/s/ William Montgomery | Director | October 28, 2013 |
William Montgomery | ||
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EXHIBIT INDEX
Regulation S-K Exhibit Table Item No. | Description of Exhibit |
31.1 | Certification by the Chief Executive Officer. Filed herewith. |
31.2 | Certification by the Chief Financial Officer. Filed herewith. |
32.1 | Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith. |
32.2 | Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith. |
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