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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
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|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
|_| Definitive Proxy Statement
|_| Definitive Additional Materials
|X| Soliciting Material under Rule 14a-12
Forgent Networks, Inc.
108 Wild Basin Road, Austin, Texas 78746
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
The Red Oak Fund, LP, a Delaware limited partnership;
Pinnacle Fund, LLLP, a Colorado limited liability limited partnership;
Bear Market Opportunity Fund, L.P., a Delaware limited partnership;
Pinnacle Partners, LLC, a Colorado limited liability company;
Red Oak Partners, LLC, a New York limited liability company;
David Sandberg.
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and state how it was
determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
|_| Fee paid previously with preliminary materials.
|_| Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1. Amount Previously Paid:
2. Form, Schedule or Registration Statement No.:
3. Filing Party:
4. Date Filed:
On May 18, 2009 Red Oak filed an amended Schedule 13D which included
Exhibits 99.A and 99.B. These Exhibits are hereby filed separately as Exhibits
99.A and 99.B to the extent they are deemed to be soliciting material.
PINNACLE FUND, LLLP
654 Broadway, Suite 5 | New York, New York 10012
Telephone (212) 614-8952 | Facsimile (646) 390-6784
May 18, 2009
VIA OVERNIGHT DELIVERY AND FACSIMILE
Management and Board of Directors
Forgent Networks, Inc.
108 Wild Basin Road
Austin, TX 78746
Re: Response to Statements from your May 12 Letter
Dear Management and the Board of Directors:
I am writing to respond to certain statements in your May 12 letter. You
mischaracterize Pinnacle's positions and your letter is one more attempt to
ignore the serious disagreement which many Asure ("ASUR") stockholders have
with your attempt to take the company private and continue excessive spending
on management compensation and other matters. Pinnacle's and Red Oak's views
are spelled out in our 13D filing and our preliminary proxy statement which we
hope we will soon be able to deliver to stockholders so they can judge our
arguments for themselves.
In the meantime, please note that we have never characterized ASUR as an
"asset play" and if we regarded it as such would not have recommended to you
several important cost-saving measures. While we have correctly pointed out
that the company was trading at a severe discount to its cash on hand, as we
told Jay Peterson in November, we viewed the company as attractive in part
because of its public forecasts of positive EBITDA and cash flow. We wish
those forecasts had proved to be correct but hope that under a new board of
directors and a slimmed down management team these goals can be achieved. As
our proxy filing will reveal, we believe that a new board, not controlled by
Pinnacle or Red Oak, but responsive to stockholders, should seek to cut costs
and return the company to profitable operations.
You are correct when you say we have tried many times to speak with you but
mistaken when you try to characterize this as inappropriate. Why should
management not be willing to hear suggestions from significant holders? In
fact the first time your CEO agreed to speak with us was for 15 minutes by
telephone on March 5 and he finally met in person on April 27. You keep
trying to cast our information requests as an "asset play," which you seem to
view as sinister. This is egregious because you know from our face-to-face
meeting that we are seeking cost reductions and believe operations can
improve. You also conveniently omit to point out that major cost savings
would result from things you could do without depriving holders of publicly
available information. You can reduce the cost of the $360,000/year D&O
insurance when the policy comes up for renewal in July, you can retain less
expensive advisors (instead of having Winstead charge you $150,000+ per year
for public filings per your CFO's statements during our meeting in Dallas on
April 27), and you can eliminate excess senior management by not having both
a CEO and a COO. During our April meeting your CEO told me and others that he
planned to leave in six months anyway and have the COO take over a dual
CEO/COO role. We believe this departure should occur immediately and without
severance (based on the aggregate losses generated under his tenure) as there
is simply no need for Asure's shareholders to pay six additional months of his
salary given he has already indicated his intent to leave. We think it is
inappropriate that you have not explained that these savings can occur
without going private.
Your comments about our requests to hold an annual meeting make us think you
do not trust your stockholders. You have ignored our requests for a
stockholder vote to elect directors, either in connection with or before the
meeting to vote on going private. With a fiscal year that ended last July,
there would seem to have been ample time to hold an annual meeting by now and
you could have saved a lot of costs by combining the two meetings. We are
sorry you regard our complaints about missed forecasts, excess overhead, and
an inability in our meeting to reconcile inconsistent statements as personal
or professional attacks. It did seem to us that your management was
unprepared to answer questions and was unable to answer several questions. You
have still not provided answers despite the statement during our April 27
meeting in Dallas by your director Mr. Miles that the request to explain
apparent discrepancies would be addressed.
Finally, we remain of the view that the price to be paid in the going private
transaction is excessive and we believe that if Southwest had based its
opinion on actual operating results instead of missed forecasts it would not
have recommended that price. You own letter admits that current stock prices
do not support paying such a price and we believe that current operating
results do not support that price either.
We remain opposed to what we regard as a wasteful transaction which has
generated large fees to advisors and which we believe has distracted the board
from taking immediate steps to reduce costs and improve operations. We are
confident that these proposals will be rejected.
Sincerely,
PINNACLE FUND, LLLP
By: PINNACLE PARTNERS, LLC,
its general partner
By: RED OAK PARTNERS, L.P.,
its general partner
By: ______________________________
David Sandberg, Managing Member
cc: Corporate Secretary
Red Oak Partners and Pinnacle Fund Respond to Statements in Asure Software's
May 12 Letter and File Preliminary Proxy Statement to Oppose Vote to
Go-Private.
New York, New York, May 18, 2009. Pinnacle Fund (controlled by Pinnacle
Partners, LLC which is partly controlled by Red Oak Partners, LLC) announced
that on Wednesday, May 13th it filed a preliminary proxy statement with the
Securities and Exchange Commission ("SEC") to oppose Asure Software's
("ASUR's") go-private proposals and also attached the statement to its amended
filing on Schedule 13D. Additionally, Pinnacle issued a letter today in
response to Asure's May 12th letter, which Asure filed with the SEC in its May
14th DEFA14A filing. Pinnacle's response letter is attached as an exhibit to
an amendment being filed today to Red Oak's Schedule 13D.
"I encourage shareholders to read our definitive proxy statement when it
becomes available before making any voting decisions, as well as both our
preliminary proxy filed on May 13th and our letter attached as an exhibit to
today's 13D filing," said David Sandberg, Portfolio Manager of the Pinnacle
Fund, LLLP. "Asure's letter attempts to ignore continued excessive spending on
management compensation, a continued omission or delay in announcing an annual
meeting date, and conveniently omits to point out that major cost savings would
result from things Asure can do without depriving holders of publicly available
information. We continue to oppose this go-private transaction and are
confident that these proposals will be rejected." Information about Red Oak,
Pinnacle, and its affiliates who are participating in Pinnacle's opposition to
Asure's go-private proposals can be found in Red Oak's preliminary proxy
materials and its Schedule 13D filing. Red Oak's filings can be found at
www.sec.gov by selecting "Search" at the top right and then typing "forgent"
into the box asking for the Company Name. Red Oak's filings which are
referenced in this press release are dated May 13th and May 18th, 2009.
Contact:
Red Oak Partners, LLC
David Sandberg, 212-614-8952
dsandberg@redoakpartners.com