UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 13D

(RULE 13D-101)

 

Information to be Included in Statements Filed
Pursuant to Rule 13d-1(a) and Amendments Thereto
Filed Pursuant to Rule 13d-2(a)

 

(Amendment No. 14)

 

 

Telos Corporation 

(Name of Issuer)

 

 

12% Cumulative Exchangeable Redeemable Preferred Stock,
Par Value $0.01 Per Share 

(Title of Class of Securities)

  

87969B200 

(CUSIP Number of Class of Securities)

 

 

Wynnefield Partners Small Cap Value, L.P.

450 Seventh Avenue, Suite 509

New York, New York 10123

Attention: Mr. Nelson Obus 

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

 

 

Copy to:

 

Frank S. Jones, Jr., Esquire,

Whiteford, Taylor & Preston L.L.P.

Seven Saint Paul Street

Baltimore, Maryland 21202

(410) 347-8700

 

 

April 30, 2014

(Date of Event Which Requires Filing of this Statement)

 

 

If the filing person has previously filed a Statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this Schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box ¨

 

(continued on following pages)

 

 

CUSIP No. 87969B200

13D/A

Page 2 of 14 pages

 

1.		NAME OF REPORTING PERSON:   Wynnefield Partners Small Cap Value, L.P. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 13-3688497
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) x Reporting Person is affiliated with other persons
3.		SEC USE ONLY
4.		SOURCE OF FUNDS   WC (SEE ITEM 3)
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   120,569 shares (See Item 5)
			8.	SHARED VOTING POWER   -0- (See Item 5)
			9.	SOLE DISPOSITIVE POWER   120,569 shares (See Item 5)
			10.	SHARED DISPOSITIVE POWER   -0- (See Item 5)
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   120,569 (See Item 5)
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES   ¨
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   3.8% (See Item 5)
14.	TYPE OF REPORTING PERSON   PN

 

 

CUSIP No. 87969B200

13D/A

Page 3 of 14 pages

 

1.		NAME OF REPORTING PERSON:   Wynnefield Small Cap Value Offshore Fund, Ltd. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: Not Applicable
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) x Reporting Person is affiliated with other persons
3.		SEC USE ONLY
4.		SOURCE OF FUNDS   WC (SEE ITEM 3)
5.		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): ¨
6.		CITIZENSHIP OR PLACE OF ORGANIZATION   CAYMAN ISLANDS
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH			7.	SOLE VOTING POWER   91,647 shares (See Item 5)
			8.	SHARED VOTING POWER   -0- (See Item 5)
			9.	SOLE DISPOSITIVE POWER   91,647 shares (See Item 5)
			10.	SHARED DISPOSITIVE POWER   -0- (See Item 5)
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   91,647 shares (See Item 5)
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES   ¨
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   2.9% (See Item 5)
14.	TYPE OF REPORTING PERSON   CO

 

 

CUSIP No. 87969B200

13D/A

Page 4 of 14 pages

 

1.		NAME OF REPORTING PERSON:   Wynnefield Partners Small Cap Value, L.P. I S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 13-3953291
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) x Reporting Person is affiliated with other persons
3.		SEC USE ONLY
4.		SOURCE OF FUNDS   WC (SEE ITEM 3)
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   188,456 shares (See Item 5)
			8.	SHARED VOTING POWER   -0- (See Item 5)
			9.	SOLE DISPOSITIVE POWER   188,456 shares (See Item 5)
			10.	SHARED DISPOSITIVE POWER   -0- (See Item 5)
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   188,456 shares (See Item 5)
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES   ¨
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   5.9% (See Item 5)
14.	TYPE OF REPORTING PERSON   PN

 

 

CUSIP No. 87969B200

13D/A

Page 5 of 14 pages

 

1.		NAME OF REPORTING PERSON:   Channel Partnership II, L.P. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 22-3215653
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) x Reporting Person is affiliated with other persons
3.		SEC USE ONLY
4.		SOURCE OF FUNDS   WC (SEE ITEM 3)
5.		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): ¨
6.		CITIZENSHIP OR PLACE OF ORGANIZATION   NEW YORK
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH			7.	SOLE VOTING POWER   -0- shares (See Item 5)
			8.	SHARED VOTING POWER   -0- (See Item 5)
			9.	SOLE DISPOSITIVE POWER   -0- shares (See Item 5)
			10.	SHARED DISPOSITIVE POWER   -0- shares (See Item 5)
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   -0- shares (See Item 5)
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES   ¨
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   0.0 % (See Item 5)
14.	TYPE OF REPORTING PERSON   PN

 

 

CUSIP No. 87969B200

13D/A

Page 6 of 14 pages

 

1.		NAME OF REPORTING PERSON:   Nelson Obus S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON:
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) x Reporting Person is affiliated with other persons
3.		SEC USE ONLY
4.		SOURCE OF FUNDS   AF (SEE ITEM 3)
5.		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): ¨
6.		CITIZENSHIP OR PLACE OF ORGANIZATION   UNITED STATES OF AMERICA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH			7.	SOLE VOTING POWER   -0- shares (See Item 5) (1)
			8.	SHARED VOTING POWER   400,672 (See Item 5) (1)
			9.	SOLE DISPOSITIVE POWER   -0- shares (See Item 5)(1)
			10.	SHARED DISPOSITIVE POWER   400,672 (See Item 5) (1)
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   400,672 shares (See Item 5)(1)
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES   ¨
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   12.6% (See Item 5)(1)
14.	TYPE OF REPORTING PERSON   IN

(1)

Mr. Obus may be deemed to have an indirect beneficial ownership in such shares through his positions as a co-managing member of Wynnefield Capital Management, LLC, a principal executive officer of Wynnefield Capital, Inc., and general partner of Channel Partnership II, L.P. Wynnefield Capital Management, LLC holds an indirect beneficial ownership interest in 309,025 shares which are directly owned by Wynnefield Partners Small Cap Value, L.P. and Wynnefield Partners Small Cap Value, L.P. I. Wynnefield Capital, Inc. holds an indirect beneficial ownership interest in 91,647 shares which are directly beneficially owned by Wynnefield Small Cap Value Offshore Fund, Ltd. As Mr. Joshua H. Landes is a co-managing member of Wynnefield Capital Management, LLC and an executive officer of Wynnefield Capital, Inc., Mr. Obus shares voting and dispositive power with Mr. Landes with regard to any shares beneficially owned by Wynnefield Capital Management, LLC and Wynnefield Capital, Inc.

 

 

CUSIP No. 87969B200

13D/A

Page 7 of 14 pages

 

1.		NAME OF REPORTING PERSON:   Joshua H. Landes S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON:
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) x Reporting Person is affiliated with other persons
3.		SEC USE ONLY
4.		SOURCE OF FUNDS   AF (SEE ITEM 3)
5.		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): ¨
6.		CITIZENSHIP OR PLACE OF ORGANIZATION   UNITED STATES OF AMERICA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH			7.	SOLE VOTING POWER   -0- shares (See Item 5) (1)
			8.	SHARED VOTING POWER   400,672 (See Item 5) (1)
			9.	SOLE DISPOSITIVE POWER   -0- shares (See Item 5)(1)
			10.	SHARED DISPOSITIVE POWER   400,672 (See Item 5) (1)
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   400,672 shares (See Item 5) (1)
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES   ¨
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   12.6% (See Item 5) (1)
14.	TYPE OF REPORTING PERSON   IN

(1)

Mr. Landes may be deemed to have an indirect beneficial ownership in such shares through his positions as a managing member of Wynnefield Capital Management, LLC and an executive officer of Wynnefield Capital, Inc. Wynnefield Capital Management, LLC holds an indirect beneficial ownership interest in 309,025 shares which are directly owned by Wynnefield Partners Small Cap Value, L.P. and Wynnefield Partners Small Cap Value, L.P. I. Wynnefield Capital, Inc. holds an indirect beneficial ownership interest in 91,647 shares which are directly beneficially owned by Wynnefield Small Cap Value Offshore Fund, Ltd. As Mr. Obus is a co-managing member of Wynnefield Capital Management, LLC and a principal executive officer of Wynnefield Capital, Inc., Mr. Landes shares voting and dispositive power with Mr. Obus with regard to any shares beneficially owned by Wynnefield Capital Management, LLC and Wynnefield Capital, Inc.

 

 

CUSIP No. 87969B200

13D/A

Page 8 of 14 pages

 

1.		NAME OF REPORTING PERSON:   Wynnefield Capital Management LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 13-4018186
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) x Reporting Person is affiliated with other persons
3.		SEC USE ONLY
4.		SOURCE OF FUNDS   AF (SEE ITEM 3)
5.		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): ¨
6.		CITIZENSHIP OR PLACE OF ORGANIZATION   NEW YORK
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH			7.	SOLE VOTING POWER   309,025 shares (See Item 5) (1)
			8.	SHARED VOTING POWER   -0- (See Item 5)
			9.	SOLE DISPOSITIVE POWER   309,025 shares (See Item 5) (1)
			10.	SHARED DISPOSITIVE POWER   -0- (See Item 5)
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   309,025 shares (See Item 5) (1)
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES   ¨
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   9.8% (See Item 5) (1)
14.	TYPE OF REPORTING PERSON   OO (Limited Liability Company)

(1)

Wynnefield Capital Management, LLC, as the general partner of Wynnefield Partners Small Cap Value, L.P. and Wynnefield Partners Small Cap Value, L.P. I, holds an indirect beneficial interest in these shares which are directly beneficially owned by Wynnefield Partners Small Cap Value, L.P. and Wynnefield Partners Small Cap Value, L.P. I.

 

 

CUSIP No. 87969B200

13D/A

Page 9 of 14 pages

 

1.		NAME OF REPORTING PERSON:   Wynnefield Capital, Inc. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: N/A
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) x Reporting Person is affiliated with other persons
3.		SEC USE ONLY
4.		SOURCE OF FUNDS   AF (SEE ITEM 3)
5.		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): ¨
6.		CITIZENSHIP OR PLACE OF ORGANIZATION   CAYMAN ISLANDS
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH			7.	SOLE VOTING POWER   91,647 shares (See Item 5)(1)
			8.	SHARED VOTING POWER   -0- (See Item 5)
			9.	SOLE DISPOSITIVE POWER   91,647 shares (See Item 5)(1)
			10.	SHARED DISPOSITIVE POWER   -0- (See Item 5)
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   91,647 shares (See Item 5)(1)
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES   ¨
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   2.9% (See Item 5)(1)
14.	TYPE OF REPORTING PERSON   CO

(1)

Wynnefield Capital, Inc. as the sole investment manager of Wynnefield Small Cap Value Offshore Fund, Ltd., holds an indirect beneficial interest in these shares which are directly beneficially owned by Wynnefield Small Cap Value Offshore Fund, Ltd.

 

 

CUSIP No. 87969B200

13D/A

Page 10 of 14 pages

 

This Amendment No. 14 (the "Amendment") amends the Statement of Beneficial Ownership on Schedule 13D, originally filed with the Securities and Exchange Commission (the "Commission") on June 24, 1997, and amended by Amendment No. 1 filed on June 22, 1998; as further amended by Amendment No. 2 filed on December 18, 2003; as further amended by Amendment No. 3 filed on April 21, 2004; as further amended by Amendment No. 4 filed on April 1, 2005; as further amended by Amendment No. 5 filed on May 9, 2005; as further amended by Amendment No. 6 filed on February 9, 2006; as further amended by Amendment No. 7 filed on June 5, 2006; as further amended by Amendment No. 8 filed on February 12, 2007; as further amended by Amendment No. 9 filed on February 21, 2007; as further amended by Amendment No. 10 filed on February 27, 2007; as further amended by Amendment No. 11 filed on August 15, 2013; as further amended by Amendment No. 12 filed on October 30, 2013 and as further amended by Amendment No. 13 filed on November 27, 2013 (the "Wynnefield Schedule 13D"), filed by Wynnefield Partners Small Cap Value, L.P. (the "Partnership"), Wynnefield Small Cap Value Offshore Fund, Ltd. (the "Fund"), Wynnefield Partners Small Cap Value, L.P. I (the "Partnership-I"), Wynnefield Capital Management, LLC ("WCM"), Wynnefield Capital, Inc. ("WCI"), Nelson Obus ("Mr. Obus"), Joshua Landes ("Mr. Landes") and Channel Partnership II, L.P. ("Channel" and, collectively with the Partnership, the Fund, the Partnership-I, WCM, WCI, Mr. Obus, and Mr. Landes, the "Wynnefield Reporting Persons"), with respect to the shares of 12% Cumulative Exchangeable Redeemable Preferred Stock, par value $0.01 per share (the "Preferred Shares" or “Preferred Stock”), of Telos Corporation, a Maryland corporation with its principal executive offices located at 19886 Ashburn Road, Ashburn, Virginia 20147-2358 (“Telos” or the "Issuer"). All defined terms refer to terms defined herein or in the Wynnefield Schedule 13D. The information contained in this Amendment is as of the date hereof, unless otherwise expressly provided herein.

 

ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.

 

“Item 3. Source and Amount of Funds or other Consideration.” appearing in the Wynnefield Schedule 13D is supplemented by adding the following disclosure to the end of such item:

 

On April 30, 2014, the following Wynnefield Reporting Person entities made the following purchases of Preferred Stock, for the consideration shown in the following table:

 

		Date of		Type of						Consideration Paid
Name		Transaction		Transaction		Number of Shares				or Received
Partnership*		April 30, 2014		Purchase			30			$	452
Partnership-*		May 1, 2014		Purchase			89			$	1,340
Partnership-I*		April 30, 2014		Purchase			50			$	753
Partnership-I*		May 1, 2014		Purchase			150			$	2258
Fund**		April 30, 2014		Purchase			20			$	301
Fund**		May 1, 2014		Purchase			61			$	918

 

* WCM has an indirect beneficial ownership interest in these shares of Preferred Stock.

** WCI has an indirect beneficial ownership interest in these shares of Preferred Stock.

 

Such shares of Preferred Stock were paid for from the working capital of the named Wynnefield Reporting Person. Each entity in the Wynnefield Reporting Persons maintains a separate investment fund, consisting of capital contributions from their respective partners and investors and capital appreciation derived therefrom for the principal purpose of buying and selling securities (including financial and money market instruments) and interests in domestic and foreign securities, including, without limitation, convertible securities, stock index futures contracts, options, puts and calls on stock and warrants.

 

ITEM 4. PURPOSE OF TRANSACTION.

 

"Item 4. Purpose of Transaction." appearing in the Wynnefield Schedule 13D is supplemented by adding the following disclosure from Wynnefield Capital Inc.'s press release to the end of such item:

 

 

CUSIP No. 87969B200

13D/A

Page 11 of 14 pages

 

“WYNNEFIELD CAPITAL CONGRATULATES TELOS ON CONTRACT AWARD; RENEWS CALLS FOR TELOS TO DISCHARGE ITS DECADES-LONG FINANCIAL LIABILITY TO TLSRP HOLDERS; Questions management bonus payments for 2013

 

NEW YORK – May12, 2014 - Wynnefield Capital, Inc. today congratulated Telos Corp. (OTCBB: TLSRP) on a recent contract award and renewed its calls for Telos to settle at the earliest possible time the principal and arrearages owed to the holders of its 12% Cumulative Exchangeable Redeemable Preferred Stock (“TLSRP”), including all payment-in-kind (“PIK”) dividend payments declared by the Telos Board of Directors for the period 1992 through June 1995. Wynnefield is a 20-year holder of approximately 12% percent of Telos’ TLSRP. If redeemed in full, the ‎ holders of the TLSRPs would receive a cash payment significantly in excess of two times the current trading price of the security.

 

“Wynnefield congratulates Telos on being one of the small businesses recently awarded a contract by the NETCENTS-2 Program Office, which provides the U.S. Air Force with a primary source of netcentric and IT products, services, and solutions. While the contract is of the indefinite delivery/indefinite quantity variety, it carries a tasty $5.8 billion program award ceiling,” said Nelson Obus, President of Wynnefield Capital. “Wynnefield additionally notes that Telos was one of the recipients of a contract for the 2004 original NETCENTS Program,” continued Mr. Obus. “Wynnefield now has renewed confidence that Telos will resolve the over 20-year liability due its holders of the TLSRPs by paying them out what they are owed -- a net amount that totals 100 cents on the dollar,” Mr. Obus added.

 

Wynnefield noted with concern that the Telos Management Development and Compensation Committee approved a total of $925,000 in short-term incentive bonuses to the Telos CEO and four other executives for fiscal 2013, despite the fact that 2013 EBITDA came in at only 38% of the target, thus falling well short of the requisite 60% EBITDA target to trigger a proportional payout under the relevant management incentive bonus plan. The $400,000 bonus paid to the CEO was in addition to his 2013 salary of $600,000 and other compensation. “In the current ‘pay for performance’ corporate management compensation world, Wynnefield believes that the short-term incentive bonuses need to be assessed more critically each and every year. Employees and representatives of Wynnefield serve on, or chair, numerous compensation committees for other issuers and we find the current compensation and governance practices extremely distressing. We are not aware of any case where bonuses were granted in years when management delivered less than 60% of plan,” Mr. Obus continued. “In our opinion, the Telos independent directors -- many who have distinguished military backgrounds -- need to attend a boot camp focusing on current appropriate compensation and governance practices. We believe that such internal largess should stiffen the resolve of the holders of TLSRPs to insist on being repaid all principal and arrearages owed them by Telos, including all Board-declared PIK payments,” Mr. Obus concluded.

 

ABOUT WYNNEFIELD CAPITAL, INC.

 

Wynnefield Capital is a 20-year holder of approximately 12% percent of Telos’ TLSRP. Established in 1992, Wynnefield Capital, Inc. is a value investor specializing in U.S. small cap situations that have company- or industry-specific catalysts.

 

CONTACT:

For Wynnefield Capital, Inc.

Kekst and Company

Eric Berman, 212-521-4894

Donald Cutler, 415-852-3903”

  

The Wynnefield Reporting Persons purchased additional Preferred Shares of Telos in April and May of 2014 because of their continuing belief in the inherent value of the Preferred Shares. The Wynnefield Reporting Persons intend to continue their efforts to have the value of the Preferred Shares realized through the redemption of their principal and accrued dividend arrearages, and may contact Telos as part of these efforts. Although the Wynnefield Reporting Persons have heard nothing recently from the Issuer’s management regarding the Issuer’s liabilities owed to the holders of Preferred Shares, the Wynnefield Reporting Persons remain open to engaging in a serious redemption discussion.

 

As of the date of this Amendment and except as set forth above, none of the Wynnefield Reporting Persons has any present plans or intentions which would result in or relate to any of the transactions described in subparagraphs (a) through (j) of Item 4 of the instructions to Schedule 13D.

 

The Wynnefield Reporting Persons reserve the right to change their plans and intentions at any time as they deem appropriate. In particular, the Wynnefield Reporting Persons may purchase Preferred Shares, or may sell or otherwise dispose of all or a portion of the Preferred Shares, in public and private transactions and/or may enter into negotiated derivative transactions to hedge the market risk of some or all positions in, or to obtain greater exposure to, the Preferred Shares.

 

Any such transactions may be effected at any time or from time to time, subject to any applicable limitations imposed on the sale of shares of the Preferred Stock by the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and applicable state securities or “blue sky” laws.

 

ITEM 5. INTERESTS IN SECURITIES OF THE ISSUER.

 

"Item 5. Interests in Securities of the Issuer." appearing in the Wynnefield Schedule 13D is supplemented by adding the following disclosure to the end of such item:

 

(A) - (C) As of May 1, 2014, the Wynnefield Reporting Persons beneficially owned in the aggregate 400,672 shares of Preferred Stock, constituting approximately 12.6% of the outstanding shares of Preferred Stock (the percentage of shares owned being based upon 3,185,586 shares outstanding on December 31, 2013, as set forth in the Issuer's most recent report on Form 10-K for the year ended December 31, 2013 filed with the Commission on March 31, 2014). The following table sets forth certain information with respect to shares of Preferred Stock directly beneficially owned by the Wynnefield Reporting Persons members listed:

 

NAME		NUMBER OF SHARES				APPROXIMATE PERCENTAGE OF OUTSTANDING SHARES
Partnership*			120,569				3.8	%
Partnership-I*			188,456				5.9	%
Fund**			91,647				2.9	%

 

* WCM has an indirect beneficial ownership interest in these shares of Preferred Stock.

 

** WCI has an indirect beneficial ownership interest in these shares of Preferred Stock.

 

WCM is the sole general partner of the Partnership and Partnership-I and, accordingly, may be deemed to be the indirect beneficial owner (as that term is defined under Rule 13d-3 under the Exchange Act) of the shares of Preferred Stock that the Partnership and Partnership-I beneficially own. WCM, as the sole general partner of the Partnership and Partnership-I, has the sole power to direct the voting and disposition of the shares of Preferred Stock that the Partnership and Partnership-I beneficially own.

 

 

CUSIP No. 87969B200

13D/A

Page 12 of 14 pages

 

Messrs. Obus and Landes are the co-managing members of WCM and, accordingly, each of Messrs. Obus and Landes may be deemed to be the indirect beneficial owner (as that term is defined under Rule 13d-3 under the Exchange Act) of the shares of Preferred Stock that WCM may be deemed to beneficially own. Each of Messrs. Obus and Landes, as a co-managing member of WCM, shares with the other the power to direct the voting and disposition of the shares of Preferred Stock that WCM may be deemed to beneficially own.

 

WCI is the sole investment manager of the Fund and, accordingly, may be deemed to be the indirect beneficial owner (as that term is defined under Rule 13d-3 under the Exchange Act) of the shares of Preferred Stock that the Fund beneficially owns. WCI, as the sole investment manager of the Fund, has the sole power to direct the voting and disposition of the shares of Preferred Stock that the Fund beneficially owns. Messrs. Obus and Landes are the principal executive officers of WCI and, accordingly, each of Messrs. Obus and Landes may be deemed to be the indirect beneficial owner (as that term is defined under Rule 13d-3 under the Exchange Act) of the shares of Preferred Stock that WCI may be deemed to beneficially own. Each of Messrs. Obus and Landes, as a principal executive officer of WCI, shares with the other the power to direct the voting and disposition of the shares of Preferred Stock that WCI may be deemed to beneficially own.

 

Beneficial ownership of shares of Preferred Stock shown on the cover pages of and set forth elsewhere in this Amendment for each of the Wynnefield Reporting Persons assumes that they have not formed a group for purposes of Section 13(d)(3) under the Exchange Act, and Rule 13d-5(b)(1) promulgated thereunder. If the members of the Wynnefield Reporting Persons were deemed to have formed a group for purposes of Section 13(d)(3) and Rule 13d-5(b)(1), the group would be deemed to own beneficially (and may be deemed to have shared voting and dispositive power over) 400,672 shares of Preferred Stock, constituting approximately 12.6% of the outstanding shares of Preferred Stock (the percentage of shares owned being based upon 3,185,586 shares outstanding on December 31, 2013, as set forth in the Issuer's most recent report on Form 10-K for the year ended December 31, 2013, filed with the Commission on

March 31, 2014).

 

The filing of this Amendment and any future amendment by the Wynnefield Reporting Persons, and the inclusion of information herein and therein with respect to Messrs. Obus and Landes, shall not be considered an admission that any of such persons, for the purpose of Section 13(d) of the Exchange Act, are the beneficial owners of any shares in which such persons do not have a pecuniary interest.

 

To the best knowledge of the Wynnefield Reporting Persons, except as described in this Amendment, none of the Wynnefield Reporting Persons, any person in control (ultimately or otherwise) of the Wynnefield Reporting Persons, any general partner, executive officer or director thereof, as applicable, beneficially owns any shares of Preferred Stock, and except as set forth in the table below, there have been no transactions in shares of Preferred Stock affected during the past 60 days, by the Wynnefield Reporting Persons, any person in control of the Wynnefield Reporting Persons (ultimately or otherwise), or any general partner, executive officer or director thereof, as applicable; provided, however, certain investment banking affiliates of the Wynnefield Reporting Persons may beneficially own shares of Preferred Stock, including shares that may be held in discretionary or advisory accounts with the Wynnefield Reporting Persons; and the Wynnefield Reporting Persons, directly or in connection with such discretionary or advisory accounts, may acquire, hold, vote or dispose of Preferred Stock, including transactions that may have occurred during the past 60 days.

 

 

CUSIP No. 87969B200

13D/A

Page 13 of 14 pages

 

The Wynnefield Reporting Persons listed below have made open market purchases of shares of Preferred Stock during the past 60 days, as follows:

 

Name		Date of Transaction		Number of Shares				Price* Per Share				Type of Transaction
Partnership		April 30, 2014			30			$	15.05			Purchase
Partnership		May 1, 2014			89			$	15.05			Purchase
Partnership-I		April 30, 2014			50			$	15.05			Purchase
Partnership-I		May 1, 2014			150			$	15.05			Purchase
Fund		April 30, 2014			20			$	15.05			Purchase
Fund		May 1, 2014			61			$	15.05			Purchase

 

*Net of broker commissions

 

(D) No person, other than each of the Wynnefield Reporting Persons referred to as the direct beneficial owner of the shares of Preferred Stock set forth in this response to Item 5, has the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, such shares of Preferred Stock.

 

(E) Not applicable.

 

 

CUSIP No. 87969B200

13D/A

Page 14 of 14 pages

 

SIGNATURE

 

After reasonable inquiry and to the best of their knowledge and belief, the undersigned certify that the information set forth in this Amendment is true, complete and correct.

 

Dated: May 12, 2014

 

WYNNEFIELD PARTNERS SMALL CAP VALUE, L.P.

 

By: Wynnefield Capital Management, LLC,

its General Partner

 

By: /s/ Nelson Obus                                         

Nelson Obus, Co-Managing Member

 

WYNNEFIELD PARTNERS SMALL CAP VALUE, L.P. I

 

By: Wynnefield Capital Management, LLC,

its General Partner

 

By: /s/ Nelson Obus                                         

Nelson Obus, Co-Managing Member

 

WYNNEFIELD SMALL CAP VALUE OFFSHORE FUND, LTD.

 

By: Wynnefield Capital, Inc.,

its Investment Manager

 

By: /s/ Nelson Obus                                         

Nelson Obus, President

 

WYNNEFIELD CAPITAL MANAGEMENT, LLC

 

By: /s/ Nelson Obus                                         

Nelson Obus, Co-Managing Member

 

WYNNEFIELD CAPITAL, INC.

 

By: /s/ Nelson Obus                                         

Nelson Obus, President

 

CHANNEL PARTNERSHIP II, L.P.

 

By: /s/ Nelson Obus                                         

Nelson Obus, General Partner

 

/s/ Nelson Obus                                         

Nelson Obus, Individually

 

/s/ Joshua H. Landes                                 

Joshua H. Landes, Individually