Abbe, Silverman and stockholders resist NHLD’s dilution Proposal.
NHLD’s Investor Directors (Abbe and Silverman) have been excluded from NHLD compensation committee membership since they joined NHLD’s Board of Directors over a year ago. This has been very frustrating for them.
On the recommendation of NHLD’s Compensation Committee, its full Board of Directors tried to further dilute NHLD’s existing stockholders, even though Abbe and Silverman voted in the minority against the recommended dilution Proposal.
This Proposal (Proposal 2) and three other Proposals were voted on by stockholders at NHLD’s 2015 Annual Shareholders Meeting on August 18, 2015. Proposal 2, which would have authorized an additional 350,000 shares of dilution for management compensation, was voted down by the shareholders.
In May 2015, Abbe and Silverman had been aggravated when NHLD’s Compensation Committee recommended Glenn Worman’s 180,000 employee stock option package to NHLD’s full Board of Directors. The stock option package passed the full Board with Abbe and Silverman relegated to the minority vote against it.
The “no vote” on Proposal 2 represents a minor victory for Abbe and Silverman, as well as NHLD’s other existing stockholders. The Chairman and CEO of NHLD as well as most of its Board of Directors are clearly out of touch with its stockholders, but this “no vote” on Proposal 2 should send a firm message to NHLD’s Chairman and CEO, Fagenson. He should to listen closely to Abbe and Silverman or leave the Company. The stockholders do not want Fagenson to use cash from NHLD’s new stock repurchase plan to offset new dilution cause by management issuing stock options to themselves.
