Form DEFA14A Destination Maternity
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): September 28, 2017
DESTINATION MATERNITY CORPORATION
(Exact name of Registrant as specified in Charter)
| Delaware | 0-21196 | 13-3045573 | ||
| (State or Other Jurisdiction of Incorporation or Organization) |
Commission File number |
(I.R.S. Employer Identification Number) |
232 Strawbridge Drive
Moorestown, NJ 08057
(Address of Principal Executive Offices)
(856) 291-9700
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act |
| ☒ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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 8.01 | Other Events. |
On September 28, 2017, Destination Maternity Corporation (the “Company”) received a letter (the “Demand Letter”) from a law firm on behalf of a stockholder. The Demand Letter identified purchases and sales in Company common stock by Orchestra-Prémaman S.A. (“Orchestra”) and Yeled Invest S.à.r.l. (“Yeled”) that occurred within a six-month period and that the law firm claimed may have triggered a requirement that Orchestra and Yeled disgorge all profits to the Company resulting from those transactions pursuant to Section 16(b) of the Securities Exchange Act of 1934 (“Section 16(b)”).
On October 3, 2017, the Company sent a copy of the Demand Letter to Orchestra and Yeled and we requested that Orchestra and Yeled provide the Company with their analysis of whether the purchases and sales that occurred within a six-month period triggered a profit that is required to be disgorged under Section 16(b), and if so, we requested a calculation of the amount of such profit as well as immediate payment of such profit to the Company as required under Section 16(b).
A copy of the Demand Letter and our subsequent request letter are filed as exhibits to this Form 8-K as Exhibits 99.1 and 99.2, respectively.
Important Additional Information
Destination Maternity, its directors and certain of its executive officers may be deemed to be participants in the solicitation of proxies from Destination Maternity stockholders in connection with the matters to be considered at Destination Maternity’s 2017 Annual Meeting to be held on October 19, 2017. On September 21, 2017, Destination Maternity filed a definitive proxy statement (the “Proxy Statement”) with the U.S. Securities and Exchange Commission (the “SEC”) in connection with any such solicitation of proxies from Destination Maternity stockholders. INVESTORS AND STOCKHOLDERS ARE STRONGLY ENCOURAGED TO READ THE PROXY STATEMENT AND ACCOMPANYING WHITE PROXY CARD WITH RESPECT TO THE 2017 ANNUAL MEETING, AND OTHER DOCUMENTS FILED WITH THE SEC, CAREFULLY AND IN THEIR ENTIRETY AS THEY CONTAIN IMPORTANT INFORMATION. Detailed information regarding the identity of potential participants, and their direct or indirect interests, by security holdings or otherwise, is set forth in the Proxy Statement and other materials to be filed with the SEC in connection with Destination Maternity’s 2017 Annual Meeting. Stockholders may obtain the Proxy Statement, any amendments or supplements to the Proxy Statement and other documents filed by Destination Maternity with the SEC for no charge at the SEC’s website at www.sec.gov. Copies will also be available at no charge at the Investor Relations section of our corporate website at http://investor.destinationmaternity.com.
| ITEM 9.01. | Financial Statements and Exhibits. |
(d) Exhibits
SIGNATURE
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 duly authorized.
| Date: October 4, 2017 | DESTINATION MATERNITY CORPORATION | |||||
| By: | /s/ David Stern | |||||
| David Stern | ||||||
| Executive Vice President & Chief Financial Officer | ||||||
Exhibit 99.1
|
Attorneys at Law | |||
| hunterkmiec.com | James A Hunter 255 West 94th Street, No. 10M New York, New York 10025 t 646 666 0122 f 646 462 3356 admitted in new york only |
Keenan D Kmiec 14020 Old Harbor Lane, No. 107 Marina Del Rey, California 90292 t 917 859 7970 f 646 462 3356 admitted in california and dc only |
September 28, 2017
The Board of Directors
Destination Maternity Corporation
232 Strawbridge Drive
Moorestown, New Jersey 08057
Fax: (856) 291-9918
E-Mail: [email protected]
BY FAX, E-MAIL, AND FIRST-CLASS MAIL
Ladies and Gentlemen:
Our firm represents Donna Ann Gabriele Chechele, a stockholder of Destination Maternity Corporation (the “Company”) as of the date hereof. We have been engaged by Ms. Chechele to investigate possible “short-swing” trading the Company’s common stock under Section 16(b) of the Securities Exchange Act of 1934, as amended (the “Act”), 15 U.S.C. § 78p(b).
Based on our investigation, we believe that Orchestra-Premaman S.A. (the “Insider”) may be liable to the Company under Section 16(b) of the Act for the profit realized from the transactions in the Company’s common stock set forth on Exhibit A hereto. We hereby request that the Company seek an accounting and disgorgement of all profit recoverable from the Insider under the Act as a result of all such transactions. Based solely on our investigation and the information available to us as of the date hereof, we currently estimate the total profit recoverable from the Insider at not less than $200,462.
The transactions set forth on Exhibit A hereto were not reported under Section 16(a) of the Act. Although the Insider disclosed those transactions in statements filed under Section 13(d) of the Act, it is possible that additional transactions remain undisclosed. Accordingly, we hereby further request that the Company conduct a thorough investigation of the trading activities of the Insider during all periods not barred by the statute of limitations.
* * *
The Board of Directors
Destination Maternity Corporation
September 28, 2017
Page 2
Please be advised that, unless the requests herein are satisfactorily addressed within 60 days of the date hereof, we are authorized to pursue all remedies provided under the Act. Kindly contact me if you would like to discuss this matter further.
Very truly yours,
/s/ James A. Hunter
James A. Hunter
Exhibit A
Transactions by Orchestra-Premaman S.A.
in the Common Stock of Destination Maternity Corporation
| Date of Transaction |
Transaction |
Number of Shares |
Price per Share (USD) |
|||||||
| 12/09/2015 | Purchase of Common Stock |
559,311 | (1) | $ | 8.2541 | (2) | ||||
| 12/10/2015 | Purchase of Common Stock |
87,353 | $ | 8.2233 | (2) | |||||
| 12/11/2015 | Purchase of Common Stock |
155,422 | $ | 8.8835 | (2) | |||||
| 12/14/2015 | Purchase of Common Stock |
78,889 | $ | 9.2610 | (2) | |||||
| 05/02/2016 | Sale of Common Stock |
1,921,820 | $ | 9.4200 | ||||||
| (1) | This purchase is matchable with the Insider’s sale on May 2, 2016 to the extent of any shares acquired after the Insider became a beneficial owner of more than 10% of the Company’s common stock. We reserve the right to disaggregate the reported transaction and treat it as separate purchases to the maximum extend permitted by law. |
| (2) | Average price per share. |
Exhibit 99.2
DESTINATION
MATERNITY
CORPORATION
232 Strawbridge Dr., Moorestown, NJ 08057 ◆ 856.291.9700 ◆ destinationmaternitycorp.com
Ronald J. Masciantonio
direct dial: (856) 291-9900
October 3, 2017
BY FEDERAL EXPRESS
| Pierre Mestre, Chairman Orchestra-Prémaman S.A. ZAC Saint-Antoine 200 avenue des Tamaris 34130 SAINT AUNES France |
Fons Mangen, Director Carine Reuter-Bonert, Director Yeled Invest S.à r.l. 318 Rue de Neudorf L-2222, Luxembourg |
| Re: | Claim under Section 16(b) of the U.S. Securities Exchange Act of 1934 |
Ladies and Gentlemen:
Enclosed please find a copy of a letter (the “Demand Letter”), dated September 28, 2017, from the law firm of Hunter & Kmiec to the Board of Directors of Destination Maternity Corporation (the “Company”). The Demand Letter identifies purchases and sales in Company common stock by Orchestra-Prémaman S.A. (“Orchestra”) and Yeled Invest S.à.r.l. (“Yeled”) that occurred within a six-month period and that appear to have triggered a requirement that Orchestra and Yeled disgorge all profits to the Company resulting from those transactions pursuant to Section 16(b) of the U.S. Securities Exchange Act of 1934 (“Section 16(b)”).
Upon a review of the disclosures in the Schedule 13D and amendments thereto filed by Orchestra and Yeled with the Securities and Exchange Commission (the “SEC”), the assertions in the letter appear to be valid, and it would thus appear that Orchestra and Yeled have engaged in short-swing trading resulting in profits that are required to be disgorged and paid over to the Company pursuant to Section 16(b). In addition, it appears that Orchestra and Yeled have failed to file any Form 3 or Forms 4 with the SEC reporting the acquisition of greater than 10% of the Company’s common stock and all subsequent transactions in Company equity securities, as required by Section 16(a) of the U.S. Securities Exchange Act of 1934.
We request that Orchestra and Yeled report to us details of all acquisitions and dispositions of Company equity securities, commencing with the transaction that resulted in either Orchestra or Yeled acquiring beneficial ownership (within the meaning of Rule 16a-1(a)(1)) in excess of 10% of the Company’s common stock. Based on your Schedule 13D filings, this date appears to be no later than December 9, 2015. For ordinary brokerage
| Philadelphia | Boston | Washington, D.C. | Los Angeles | New York | Pittsburgh | |||||||||
| Detroit | Berwyn | Harrisburg | Orange County | Princeton | Silicon Valley | Wilmington | ||||||||
www.pepperlaw.com
Orchestra-Prémaman S.A.
Yeled Invest S.à.r.l
Page 2
October 3, 2017
transactions and the sale from Orchestra to Yeled that was completed on May 2, 2016, the requested details include the date, the number of shares acquired or disposed of, and the per share price paid or received.
We note that in the Schedule 13D amendment filed by Orchestra with the SEC on May 2, 2016, a Share Transfer Agreement is attached which reflects the sale of shares by Orchestra to Yeled, as well as the grant of an option by Yeled to Orchestra to reacquire the shares within a 24-month period. We request an explanation of the details of the underlying sale and option transaction between Orchestra and Yeled.
We further request your analysis of whether the purchases and sales that occurred within a six-month period triggered a profit that is required to be disgorged under Section 16(b), and if so, we request a calculation of the amount of such profit as well as immediate payment of such profit to the Company as required under Section 16(b). The Company will take your analysis into account but will not be bound by your analysis, and any payment made by you will not foreclose the right of the Company to demand additional amounts if our analysis of the transactions engaged in by Orchestra and Yeled in Company equity securities yields a higher calculation of disgorgeable profit.
| Sincerely, |
| /s/ Ronald J. Masciantonio |
| Ronald J. Masciantonio |
| Executive Vice President & Chief Administrative Officer |