1
|
NAME OF REPORTING PERSON
Richmond Brothers, Inc.
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
OO
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
MICHIGAN
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
5,183,152
|
|
8
|
SHARED VOTING POWER
- 0 -
|
||
9
|
SOLE DISPOSITIVE POWER
5,183,152
|
||
10
|
SHARED DISPOSITIVE POWER
- 0 -
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,183,152
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.1%
|
||
14
|
TYPE OF REPORTING PERSON
IA, CO
|
1
|
NAME OF REPORTING PERSON
RBI Private Investment I, LLC
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
WC
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
164,841
|
|
8
|
SHARED VOTING POWER
- 0 -
|
||
9
|
SOLE DISPOSITIVE POWER
164,841
|
||
10
|
SHARED DISPOSITIVE POWER
- 0 -
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
164,841
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
|
||
14
|
TYPE OF REPORTING PERSON
OO
|
1
|
NAME OF REPORTING PERSON
RBI PI Manager, LLC
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
AF
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
164,841
|
|
8
|
SHARED VOTING POWER
- 0 -
|
||
9
|
SOLE DISPOSITIVE POWER
164,841
|
||
10
|
SHARED DISPOSITIVE POWER
- 0 -
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
164,841
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
|
||
14
|
TYPE OF REPORTING PERSON
OO
|
1
|
NAME OF REPORTING PERSON
Richmond Brothers 401(k) Profit Sharing Plan
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
WC
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
MICHIGAN
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
34,087
|
|
8
|
SHARED VOTING POWER
- 0 -
|
||
9
|
SOLE DISPOSITIVE POWER
34,087
|
||
10
|
SHARED DISPOSITIVE POWER
- 0 -
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
34,087
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
|
||
14
|
TYPE OF REPORTING PERSON
EP
|
1
|
NAME OF REPORTING PERSON
David S. Richmond
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
OO, PF
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
USA
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
341,253
|
|
8
|
SHARED VOTING POWER
5,245,489
|
||
9
|
SOLE DISPOSITIVE POWER
341,253
|
||
10
|
SHARED DISPOSITIVE POWER
5,245,489
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,586,742
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.8%
|
||
14
|
TYPE OF REPORTING PERSON
IN
|
1
|
NAME OF REPORTING PERSON
Matthew J. Curfman
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
OO, PF
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
USA
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
40,684
|
|
8
|
SHARED VOTING POWER
5,251,624
|
||
9
|
SOLE DISPOSITIVE POWER
40,684
|
||
10
|
SHARED DISPOSITIVE POWER
5,251,624
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,292,308
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.3%
|
||
14
|
TYPE OF REPORTING PERSON
IN
|
1
|
NAME OF REPORTING PERSON
Norman J. Ravich Irrevocable Trust
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
WC
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
MINNESOTA
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
44,400
|
|
8
|
SHARED VOTING POWER
-0-
|
||
9
|
SOLE DISPOSITIVE POWER
44,400
|
||
10
|
SHARED DISPOSITIVE POWER
-0-
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
44,400
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
|
||
14
|
TYPE OF REPORTING PERSON
OO
|
1
|
NAME OF REPORTING PERSON
Norman and Sally Ravich Family Trust
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
WC
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
MINNESOTA
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
18,500*
|
|
8
|
SHARED VOTING POWER
-0-
|
||
9
|
SOLE DISPOSITIVE POWER
18,500*
|
||
10
|
SHARED DISPOSITIVE POWER
-0-
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
18,500*
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
|
||
14
|
TYPE OF REPORTING PERSON
OO
|
1
|
NAME OF REPORTING PERSON
Alexander Coleman Ravich 1991 Irrevocable Trust
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
WC
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
MINNESOTA
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
25,000
|
|
8
|
SHARED VOTING POWER
- 0 -
|
||
9
|
SOLE DISPOSITIVE POWER
25,000
|
||
10
|
SHARED DISPOSITIVE POWER
- 0 -
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
25,000
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
|
||
14
|
TYPE OF REPORTING PERSON
OO
|
1
|
NAME OF REPORTING PERSON
Alyssa Danielle Ravich 1991 Irrevocable Trust
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
WC
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
MINNESOTA
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
25,000
|
|
8
|
SHARED VOTING POWER
- 0 -
|
||
9
|
SOLE DISPOSITIVE POWER
25,000
|
||
10
|
SHARED DISPOSITIVE POWER
- 0 -
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
25,000
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
|
||
14
|
TYPE OF REPORTING PERSON
OO
|
1
|
NAME OF REPORTING PERSON
Mark H. Ravich
|
||
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a) x
(b) o
|
|
3
|
SEC USE ONLY
|
||
4
|
SOURCE OF FUNDS
PF, AF
|
||
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
|
¨
|
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
USA
|
||
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE VOTING POWER
467,650*
|
|
8
|
SHARED VOTING POWER
- 0 -
|
||
9
|
SOLE DISPOSITIVE POWER
467,650*
|
||
10
|
SHARED DISPOSITIVE POWER
- 0 -
|
||
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
467,650*
|
||
12
|
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
o
|
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%*
|
||
14
|
TYPE OF REPORTING PERSON
IN
|
Item 4.
|
Purpose of Transaction.
|
Item 7.
|
Material to be Filed as Exhibits.
|
|
99.1
|
Press Release, dated March 2, 2017.
|
Richmond Brothers, Inc.
|
|||
By:
|
/s/ David S. Richmond
|
||
Name:
|
David S. Richmond
|
||
Title:
|
Chairman
|
RBI Private Investment I, LLC
|
|||
By:
|
RBI PI Manager, LLC
|
||
Manager
|
|||
By:
|
/s/ David S. Richmond
|
||
Name:
|
David S. Richmond
|
||
Title:
|
Manager
|
By:
|
RBI PI Manager, LLC
|
||
By:
|
/s/ David S. Richmond
|
||
Name:
|
David S. Richmond
|
||
Title:
|
Manager
|
By:
|
Richmond Brothers 401(k) Profit Sharing Plan
|
||
By:
|
/s/ David S. Richmond
|
||
Name:
|
David S. Richmond
|
||
Title:
|
Trustee
|
/s/ David S. Richmond
|
|
David S. Richmond
|
/s/ Matthew J. Curfman
|
|
Matthew J. Curfman
|
Norman J. Ravich Irrevocable Trust
|
|||
By:
|
/s/ Mark H. Ravich
|
||
Name:
|
Mark H. Ravich
|
||
Title:
|
Trustee
|
Alexander Coleman Ravich 1991 Irrevocable Trust
|
|||
By:
|
/s/ Mark H. Ravich
|
||
Name:
|
Mark H. Ravich
|
||
Title:
|
Trustee
|
Alyssa Danielle Ravich 1991 Irrevocable Trust
|
|||
By:
|
/s/ Mark H. Ravich
|
||
Name:
|
Mark H. Ravich
|
||
Title:
|
Trustee
|
Norman and Sally Ravich Family Trust
|
|||
By:
|
/s/ Mark H. Ravich
|
||
Name:
|
Mark H. Ravich
|
||
Title:
|
Trustee
|
/s/ Mark H. Ravich
|
|
Mark H. Ravich
|
|
·
|
The Company has failed to monetize its promising drug candidates. It has now been over two years since the approval of Triferic and more than three years since the approval of Calcitriol, the Company’s vitamin D drug, and Rockwell has failed to generate revenue from either. We believe this clearly calls into question management’s strategy and competency to successfully build shareholder value.
|
|
o
|
In the most recent example of this, in February 2017 the Company announced that once again it had failed to get FDA approval to manufacture Calcitriol (a drug that has already been approved) and would have to start that process over, which will cause a delay of at least four to six months.
|
|
o
|
Furthermore, the Company has not aggressively developed opportunities for licensing Triferic throughout the world or been sufficiently proactive in developing Triferic for other indications.
|
|
·
|
Management has continually left investors in the dark. Rockwell’s management has been running the Company in an opaque manner that makes it extremely difficult to recognize the Company’s true potential. They have never publicly defined the size of the markets of other indications for which Triferic can be used. Additionally, they have failed to put forth a plan and timeline for achieving success in these markets.
|
|
·
|
Rockwell has repeatedly disappointed investors with its performance. Management has consistently disappointed its investor and analyst base through lack of performance, poor guidance and a lack of effective communications with its shareholders. A good example of this was the Q4 2015 earnings conference call during which the Company announced without any advance modification to its guidance that it effectively priced Triferic out of the market in order to seek higher reimbursement. Many analysts dropped their coverage of the Company at that time.
|
|
·
|
The Company has been characterized by dismal corporate governance. Leading proxy advisory firm ISS has assigned Rockwell a QualityScore of 10, the worst possible score on a scale of 1 to 10, indicating the highest governance risks. Some of the ways in which the incumbent directors have utilized the Company’s corporate machinery to insulate themselves from stockholders include the classified structure of the Board, requiring action by written consent to be unanimous unless the proposed action is pre-approved by the Board and permitting shareholders to call special meetings only upon the request of a majority of the outstanding shares. The Board’s apparent attempt to insulate itself appears to be working given that out of the Company’s five directors, three have been on the Board for 17 years and a fourth has been a member for more than 11 years. Meanwhile, ISS takes the position that tenure of more than nine years is considered to potentially compromise a director’s independence. These, and other governance shortcomings at Rockwell, have caused ISS to recommend a WITHHOLD vote with respect to Rockwell’s directors standing for reelection at its past two annual meetings.
|
|
·
|
The Company suffers from poor compensation practices. Chairman and CEO Robert Chioini’s compensation is significantly above industry standards and he has been granted excessive short-dated stock options – taking advantage of the low stock price we believe he helped create – despite his poor performance. While public shareholders were significantly diluted by the Company’s botched financing in 2013, Mr. Chioini has managed to more than make up for this dilution via his excessive option grants. Shareholders rightfully defeated the Company’s compensation plan at the 2016 Annual Meeting – given that it lacked any merit-based structure and essentially rewarded management simply for occupying their positions – and the Company has operated without a compensation plan since May 2016.
|
|
·
|
Mark H. Ravich – Mr. Ravich currently serves as President of Tri-Star Management, Inc., a commercial real estate management and syndication company that he co-founded in 1998. He is also a director of Orchids Paper Products Company, (NYSEMKT:TIS), a national supplier of high quality consumer tissue products, where he serves as Chairman of its Governance Committee and a member of its Audit Committee. Previously, from 1990 until its sale in 1998, Mr. Ravich served as the Chief Executive Officer and a director of Universal International, Inc., a wholesale retail company, where he also led its IPO. Mr. Ravich’s additional Board experience includes serving as a director on the boards of MR Instruments, Inc., and Dilon Technologies Inc., as well as a Board advisor to Scidera Inc. From 1978 to 1990, Mr. Ravich was a developer of commercial real estate where he was involved with all aspects of development, finance, construction, marketing, leasing and management of various commercial, industrial, office and multi-family real estate projects, and he currently serves as the chief manager of various real estate entities. Mr. Ravich graduated Magna Cum Laude from the Wharton School of the University of Pennsylvania with a BSE and an MBA degree with a major in finance. We believe that Mr. Ravich’s prior board experience coupled with his financial expertise will make him a valuable addition to the Board.
|
|
·
|
David S. Richmond – Mr. Richmond currently serves as the Chairman of Richmond Brothers, Inc., an SEC registered investment advisor and wealth management firm that he co-founded in 1994. At Richmond Brothers, where Mr. Richmond also previously served as President, he handles strategic planning and is responsible for client investment planning, research, investment recommendations, allocations and implementation. Mr. Richmond also served as a registered representative at various independent firms from 1992 to 2011. He is a Chartered Financial Consultant (ChFC) and a Chartered Advisor in Philanthropy (CAP), and currently serves as a director of The Lingap Children’s Foundation, a 501(c)(3) organization focused on charitable efforts to help children in the Philippines. Mr. Richmond earned his Master of Science in Financial Services (MSFS) from American College and graduated with a BBA from Michigan State University. We believe that Mr. Richmond’s financial expertise and business acumen, along with his firm’s position as the largest shareholder of Rockwell Medical will make him a valuable addition to the Board and a true representative of shareholders’ best interests.”
|