“Question 17 — Criminal ProceedingsDuring the past ten years, have you been convicted in a criminal proceeding or are you a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses)?
- Yes x No"
- “The case you note is not a theft charge. Sham was charged, years after the fact, with making an alleged unauthorized payment to a third party in connection with an employment during his college years.
- These charges are not the type of charges, and are not within the timeframes, that are addressed by SEC, OTC or stock market questionnaires and disclosures.
- The other charge relates to Sham checking the incorrect box on his driver’s license application, stemming from his uncertain and unknown immigration status that resulted from the application of technical immigration laws when Sham was a child.
- …(criminal court documents are short and conclusory in nature) and we don’t have any to provide. ”
- The case is one for “Theft by Taking”, a fact acknowledged by Mr. Gad’s own immigration attorney. It involved the theft by Mr. Gad of monies from both his employer’s account and the account of Keep Athens-Clarke County Beautiful, a non-profit entity of which Mr. Gad served as Treasurer. On six separate occasions over nearly a year and half Mr. Gad transferred monies to his own bank account or the account of an association controlled by him. In his guilty plea, Mr. Gad explicitly acknowledged the details of the felony crimes.
- Felony charges are exactly the type of charges addressed by the SEC’s rules and the time period during which disclosure is required runs for 10 years from the date of conviction (in Mr. Gad’s case 5/8/2008).
- The charge “False Statements/writings/Concealment of Facts” is not as innocuous and trivial as Mr. Bork suggests. It relates to Mr. Gad’s falsely claiming to be a citizen of the United States.
- The documents are not short and conclusory – Mr. Gad’s guilty plea alone runs 12 pages (before certification) and the motion papers filed by Mr. Gad for a new trial or to withdraw his guilty plea run another 12 pages before numerous affidavits which we have been unable to obtain and which Mr. Gad and his counsel refuse to disclose to the Company. Additionally, Mr. Bork’s claim that he does not have any [documents] seems at variance with his claimed detailed knowledge of these papers and, alternatively, his refusal to obtain any documents from Mr. Gad’s criminal defense counsel, as we suggested.
Despite these incidents and history, we remain committed to properly vetting both Messrs. Gad and Weisser for inclusion on your Board of Directors. The Board’s nominating committee will be contacting both of them in the coming weeks to schedule interviews as part of the vetting process. Since this process began we have also been contacted by other large shareholders to informally nominate director candidates. All of these suggestions will be handled properly and according to the highest standards of corporate governance.I hope you find the above information helpful and informative. The Board of Directors remains committed to faithfully representing the interests of all shareholders and welcome dialogue with all of our shareholders to that end. Please contact me directly to discuss any concerns you may have about this or any other matter related to SED. Very truly yours, Samuel A. KidstonChairman