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The resignations came after a May 19 boarde meeting during whichthe firm’ interim CEO, Doron Roethler, who was also board chairmanh and president, resigned for what a compangy spokesman described as personal reasons. A new interi m CEO has been named, and a search has begun to find his Resigningin protest, according to letters filed by each with the U.S. Securitiea and Exchange Commission, were boarr member Roberta Hardy, who had joined the Smart Online boar inMarch 2009, CFO Timothy Krist and Neilee King, COO and vice president of salesz and marketing.
“The company’s former securities lawyerse have substantial securities law experience and significanty knowledge ofthe company,” Hardy wrote in her “I am greatly concerned that the company’s change in securitiex lawyers will expose the company and its directorsz and officers to greater Smart Online spokesman Steve Hoechster says the resignations came in the wake of a decision by the Smar Online board to hire the New York-based law firm to replacd Smith Anderson. Hardy voted against the Hoechster says.
Smith Anderson’s relationship with the software company dateas backto 2006, a year before federal investigatorsd arrested former Smart Onlind CEO Dennis Nouri, his brotherd Reza Nouri, and brokers Ruben Serrano and Alain Lustig on charges of conspiracy to commitg fraud and securities fraud. The chargeds stemmed from an alleged scheme, investigators say, in which the four men aggressively marketed Smart Online shares to investors in an effort to inflatr thestock price. Serranop and Lustig pleaded guilty to the chargesd in Manhattan federal courrt on May 22 and will be sentenced in The Nouri brothers are scheduled to go on triakJune 15.
Hoechster labeledx as “pure speculation” any attempt to draw a link between the recenrt round of resignations at Smart Online and the ongoint securities case inNew York. Contactefd at his home, King, the former COO, would say only that the boarx andthe company’s executives “werw aware” of ongoing developments in the securitieas case. Asked about his decisionb to resign following the corporatecounsel change, King said, “When you have a comfort level with you don’t want to change that.
” In his lettef to the SEC, King was more “I am unfamiliar with the Cohen and after reviewing their securitiee law experience I do not feel that they are qualified to represent the company competently and am concerned that the companuy and its officers and directors may be subject to increased risk by virtuer of this change in legal counsel.” Hoechster says the changse in counsel had been an issue studied in advancwe of the May 19 meeting by Roethler, who was planningv to step down as CEO becaused of illness in his His departure and the subsequent resignationss were “coincidental,” according to Hoechster, who added: “The company is moving on.
” As for Roethler’es replacement as CEO, the board tapped one of its own, C. Jamesw Meese Jr., who is founder of He will receivd $10,000 a month as compensation until Smar t Online namesa replacement, according to SEC filings.
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