UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )*
FLANDERS CORPORATION
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(Name of Issuer)
COMMON STOCK, $0.001 PAR VALUE
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(Title of Class of Securities)
338494 10 7
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(CUSIP Number)
STEVEN K. CLARK
903 PINELLA BAYWAY,
TIERRA VERDE, FLORIDA 33705
(TELEPHONE: 727-403-1177 )
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
OCTOBER 3, 2007
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(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. |X|
NOTE: Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. SEE Rule 13d-7 for
other parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of __ Pages)
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not
be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934, as amended (the "Act"), or otherwise subject to the liabilities of
that section of the Act but shall be subject to all other provisions of the Act
(however, see the Notes).
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CUSIP NO. 338494 10 7 SCHEDULE 13D PAGE 2 OF __ PAGES
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1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
STEVEN K. CLARK
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) (b)
NOT APPLICABLE
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3 SEC USE ONLY
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4 SOURCE OF FUNDS (See Instructions)
PF
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5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) OR 2(e)
NOT APPLICABLE
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
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7 SOLE VOTING POWER
NUMBER OF 2,000,000
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SHARES 8 SHARED VOTING POWER
BENEFICIALLY -0-
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OWNED BY EACH 9 SOLE DISPOSITIVE POWER
REPORTING 2,000,000
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PERSON WITH 10 SHARED DISPOSITIVE POWER
-0-
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,000,000(1)
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(See Instructions)
NOT APPLICABLE
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.03%
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14 TYPE OF REPORTING PERSON (See Instructions)
IN
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__________________
(1) Consists of options to acquire 2,000,000 shares which are exercisable
within the next 90 days.
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SCHEDULE 13D
ITEM 1. SECURITY AND ISSUER
This Schedule 13D relates to the common stock, $0.001 par value per
share (the "Common Stock"), of Flanders Corporation, a North Carolina
corporation (the "Issuer"). The address of the principal executive
offices of the Issuer is 2399 26th Avenue North, Saint Petersburg,
Florida 33713.
ITEM 2. IDENTITY AND BACKGROUND
(A) Steven K. Clark
(B) The address of Mr. Clark is 903 Pinella Bayway, Tierra Verde,
Florida, 33705.
(C) Mr. Clark was until August 13, 2007 the President, Chief
Executive Officer, Chief Financial Officer and temporary
Principal Accounting Officer of the Issuer. Following that
date, he no longer served as a management executive or officer
of the Issuer, but continued as a director of the Issuer until
October 4, 2007, and as an employee of the Issuer until
October 3, 2007. He is now a self-employed private investor.
(D) During the last five years, Mr. Clark has not been convicted
in a criminal proceeding, excluding traffic violations or
similar misdemeanors.
(E) During the last five years, Mr. Clark has not been a party to
a civil proceeding of a judicial or administrative body of
competent jurisdiction that resulted in his being subject to a
judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject to, federal
or state securities laws or finding any violation with respect
to such laws.
(F) Mr. Clark is a citizen of the United States of America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
As of October 3, 2007, prior to the settlement reported in Items 4 and
6, Mr. Clark beneficially owned 5,487,717 shares of Common Stock of the
Issuer, of which (a) 2,487,717 shares were owned of record by Mr. Clark
prior to October 3, 2007, (b) 1,000,000 were covered by an option
granted to Mr. Clark on December 22, 1999 with an exercise price of
$2.50 per share, which options were exercised on October 3, 2007 by
means of Mr. Clark surrendering to the Company a total of 543,478
shares to pay the exercise price, and (c) the remaining beneficial
ownership consisted of options not yet exercised by Mr. Clark covering
2,000,000 shares. The source and amount of funds used by Mr. Clark for
acquisition of the shares referred to in clause (a) above was a loan
from the Issuer which, as of October 3, 2007 reflected indebtedness of
$5,445,810.65 prior to consummation of the transactions provided for in
the Settlement Agreement (defined below). The source and amount of
consideration for exercise of the option referred to in clause (b)
above consisted of 543,478 shares of the Common Stock held of record by
Mr. Clark. The source of consideration for the remaining unexercised
options referred to in clause (c) above was his employment with the
Issuer and participation in its incentive plan.
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ITEM 4. PURPOSE OF TRANSACTION
Mr. Clark acquired his shares of Common Stock in the Issuer pursuant to
his compensation package during his tenure as an executive with the
Issuer for the purpose of investment.
Except as provided below in this Item 4 or otherwise in this Schedule
13D, Mr. Clark has no current plans or proposals that relate to or
would result in:
(A) The acquisition of additional securities of the Issuer, or the
disposition of securities of the Issuer;
(B) An extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of
its subsidiaries;
(C) A sale or transfer of a material amount of assets of the
Issuer or of any of its subsidiaries;
(D) Any change in the present board of directors or management of
the Issuer, including any plans or proposals to change the
number of term of directors or to fill any existing vacancies
on the board;
(E) Any material change in the present capitalization or dividend
policy of the Issuer;
(F) Any other material change in the Issuer's business or
corporate structure; or
(G) Changes in the Issuer's charter, bylaws or instruments
corresponding thereto or other actions which may impede the
acquisition of control of the Issuer by any person;
(H) Causing a class of securities of the Issuer to be delisted
from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of
a registered national securities association;
(I) A class of equity securities of the Issuer becoming eligible
for termination of registration; or
(J) Any action similar to any of those enumerated above.
On August 13, 2007, a dispute arose between Mr. Clark and the Issuer.
As of that date, Mr. Clark was removed as an officer of the Issuer and
since then Mr. Clark has not participated as a management executive or
officer of the Issuer, but continued as an employee of the Issuer on
administrative leave. Between August 13, 2007 and October 3, 2007, Mr.
Clark and the Issuer attempted to resolve their dispute. During that
time, Mr. Clark continued to hold the Common Stock for investment
purposes.
On October 3, 2007, Mr. Clark entered into a Settlement Agreement and
Mutual Release (the "Settlement Agreement")(included as Exhibit 99.8
hereto) with the Issuer, Robert R. Amerson ("Mr. Amerson"), Harry L.
Smith, Jr. ("Mr. Smith"), Wal-Pat, LLC, and Mercury Diecutting, LLC as
reported in Item 6. The Settlement Agreement provides for the
transactions described in Item 6. Except for his prospective
resignation as a Director, the effective date of which is deferred
until consummation of the transactions contemplated by the Settlement
Agreement, the transactions provided for in the Settlement Agreement
shall be effective as of September 30, 2007 unless Mr. Clark exercises
his unconditional right to revoke the Settlement Agreement on or before
October 10, 2007 (the "Revocation Right"). Pursuant to the Settlement
Agreement, Mr. Clark's resignation as a director is expected to become
effective on October 4, 2007 only if he does not exercise the
Revocation Right. Mr. Clark does not presently intend to exercise the
Revocation Right, but reserves the right to do so.
As a result of the transactions under the Settlement Agreement, unless
Mr. Clark exercises his Revocation Right on or before October 10, 2007,
he will be deemed as of October 3, 2007 to no longer hold of record any
shares in the Issuer. He retains three stock option grants (the
"Remaining Options") consisting of options to purchase an aggregate of
2,000,000 shares of the Common Stock as described in Item 6. Because
the current market price of the stock of the Issuer is lower than the
exercise prices of Mr. Clark's Remaining Options, he does not expect to
exercise the Remaining Options. Under the terms of the associated Stock
Option Agreements (see Exhibits 99.3 - 99.5), the expiration dates of
the Remaining Options have been accelerated as a result of the
termination of his employment with the Issuer, such that all of the
Remaining Options will expire within 90 days of the termination of his
employment. Unless the market price of the Issuer's stock increases to
a price that exceeds Mr. Clark's exercise prices (see Item 6 below),
which Mr. Clark does not expect to occur, Mr. Clark has no current
intention to exercise the Remaining Options prior to their expiration.
Therefore, Mr. Clark expects that at the end of such 90 days, he will
have no remaining beneficial ownership of Common Stock of the Issuer.
The above description of the Settlement Agreement is qualified in its
entirety by this reference to the attached copy of the Settlement
Agreement included as Exhibit 99.8 hereto.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(A) As a result of the transactions under the Settlement
Agreement, unless Mr. Clark exercises his Revocation Right on
or before October 10, 2007, the aggregate number of shares,
and percentage of the outstanding shares, of Common Stock
beneficially owned by Mr. Clark is 2,000,000 shares or 8.03%
of the issued and outstanding shares of Common Stock. If Mr.
Clark exercises his Revocation Right, the aggregate number of
shares, and percentage of the outstanding shares, of Common
Stock that would be beneficially owned by Mr. Clark is
5,487,717 shares or 20.61% of the issued and outstanding
shares of Common Stock. At the date hereof, Mr. Clark does not
presently intend to exercise the Revocation Right, but
reserves the right to do so.
(B) Mr. Clark has the sole power to vote or to direct the vote and
the sole power to dispose or to direct the disposition of all
shares of Common Stock identified pursuant to paragraph (A)
above.
(C) Not Applicable.
(D) Not applicable.
(E) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER
On December 15, 1995, Mr. Clark entered into an Employment Agreement
(the "Employment Agreement")(included as Exhibit 99.1 hereto) with
Elite Acquisitions, Inc. (predecessor of the Issuer) and Flanders
Filters, Inc (a subsidiary of the Issuer), which agreement will have
been terminated as of October 10, 2007 pursuant to the Settlement
Agreement unless Mr. Clark exercises his Revocation Right. The Issuer
granted to Mr. Clark options to purchase such shares of Common Stock
from the Issuer as follows:
(i) 1,000,000 shares which were subject to an option to
purchase at $2.50 per share (expiring in 2009), which
option Mr. Clark exercised in full pursuant to the
Settlement Agreement;
(ii) 1,000,000 shares subject to an option to purchase
such shares at $7.50 per share (expiring in 2011);
(iii) 500,000 shares subject to an option to purchase at
$8.60 per share (expiring in 2009); and
(iv) 500,000 shares subject to an option to purchase at
$11.10 per share (expiring in 2010).
In connection with such options, Mr. Clark entered into the following
agreements with the Issuer:
(a) Stock Option Agreement dated December 22, 1999
(attached as Exhibit 99.2 hereto) exercised in full
pursuant to the Settlement Agreement;
(b) Stock Option Agreement dated November 7, 2001
(attached as Exhibit 99.3 hereto);
(c) Stock Option Agreement dated August 24, 2004
(attached as Exhibit 99.4 hereto); and
(d) Stock Option Agreement dated December 7, 2005
(attached as Exhibit 99.5 hereto).
On October 3, 2007, Mr. Clark entered into the Settlement Agreement
(included as Exhibit 99.8 hereto) with the Issuer, Mr. Amerson, Mr.
Smith, Wal-Pat, LLC, and Mercury Diecutting, LLC. As part of the
settlement of various disputes regarding his removal as an officer, the
Settlement Agreement provided, among other things, for the disposition
of Mr. Clark's shares of Common Stock from the Issuer as follows:
(i) In satisfaction of debt owed to the Issuer, Mr. Clark
agreed to transfer 1,183,872 of his shares of the
Common Stock to the Issuer.
(ii) In satisfaction of his portion of the liability owed
with respect to a previous and unrelated settlement
agreement, Mr. Clark agreed to transfer 250,000 of
his shares of Common Stock to Mr. Amerson.
(iii) Mr. Amerson and Mr. Smith agreed to purchase all
remaining shares of Common Stock in the Issuer held
of record by Mr. Clark, including the shares acquired
pursuant to the exercise below in (iv), for a cash
price of $4.60 per share, resulting in Mr. Amerson
purchasing 755,183.5 of such shares and Mr. Smith
agreeing to purchase 755,183.5 of such shares.
(iv) Mr. Clark exercised in full his Option to purchase
1,000,000 shares pursuant to the Option Agreement
dated December 22, 1999 (Exhibit 99.2 hereto) at the
price of $2.50 per share pursuant to a cashless
exercise under which Mr. Clark surrendered 543,478
shares of the Common Stock held of record by him to
the Issuer in satisfaction of the $2,500,000 exercise
price. Pursuant to the Settlement Agreement Mr. Clark
then immediately disposed of such shares so acquired.
The above description of the Settlement Agreement is qualified in its
entirety by this reference to the attached copy of the Settlement
Agreement included as Exhibit 99.8 hereto.
Other than as described in this Item 6 and elsewhere, there are no
current contracts, arrangements, understandings of relationships (legal
or otherwise) among or between Mr. Clark and any other person with
respect to any securities of the Issuer.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit 99.1 - Employment Agreement between Elite Acquisitions, Inc.,
Flanders Filters, Inc., and Mr. Clark, entered into December 15, 1995
(Intentionally omitted and incorporated by reference to Form 10-K filed
by the Issuer with the SEC on December 31, 1995).
Exhibit 99.2 - Stock Option Agreement between Flanders Corporation and
Mr. Clark, entered into December 22, 1999 (included as Exhibit D to
Exhibit 99.8 to this Schedule 13D).
Exhibit 99.3 - Stock Option Agreement between Flanders Corporation and
Mr. Clark, entered into November 7, 2001 (Intentionally omitted and
incorporated by reference to Form 10-K filed by the Issuer with the SEC
on April 19, 2002).
Exhibit 99.4 - Stock Option Agreement between Flanders Corporation and
Mr. Clark, entered into August 24, 2004 (Intentionally omitted and
incorporated by reference to Form 10-K filed by the Issuer with the SEC
on February 18, 2005).
Exhibit 99.5 - Stock Option Agreement between Flanders Corporation and
Mr. Clark, entered into December 7, 2005 (Intentionally omitted and
incorporated by reference to Form 10-K filed by the Issuer with the SEC
on February 22, 2006).
Exhibit 99.6 - Promissory Note of Mr. Clark payable to Flanders
Corporation dated April 24, 1999 (Intentionally omitted and
incorporated by reference to Form 10-K filed by the Issuer with the SEC
on April 14, 2000).
Exhibit 99.7 - Indemnity Agreement entered into by and between Mr.
Clark and Flanders Corporation.
Exhibit 99.8 - Settlement Agreement between Mr. Clark, Flanders
Corporation, Robert R. Amerson, Harry L. Smith, Jr., Wal-Pat, LLC, and
Mercury Diecutting, LLC, dated October 3, 2007.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement on Schedule 13D is
true, complete and correct.
Date: October 3, 2007 /s/ Steven K. Clark
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Steven K. Clark
ATTENTION: Intentional misstatements or omissions of fact constitute
Federal criminal violations (SEE 18 U.S.C. 1001).
SCHEDULE 13D EXHIBIT INDEX
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EXHIBIT NO. DESCRIPTION OF EXHIBIT
99.1 Employment Agreement between Elite Acquisitions, Inc., Flanders
Filters, Inc., and Mr. Clark, entered into December 15, 1995
(Intentionally omitted and incorporated by reference to Form 10-K
filed by the Issuer with the SEC on December 31, 1995).
99.2 Stock Option Agreement between Flanders Corporation and Mr.
Clark, entered into December 22, 1999 (included as Exhibit D to
Exhibit 99.8 to this Schedule 13D).
99.3 Stock Option Agreement between Flanders Corporation and Mr.
Clark, entered into November 7, 2001 (Intentionally omitted and
incorporated by reference to Form 10-K filed by the Issuer with
the SEC on April 19, 2000).
99.4 Stock Option Agreement between Flanders Corporation and Mr.
Clark, entered into August 24, 2004 (Intentionally omitted and
incorporated by reference to Form 10-K filed by the Issuer with
the SEC on February 18, 2005).
99.5 Stock Option Agreement between Flanders Corporation and Mr.
Clark, entered into December 7, 2005 (Intentionally omitted and
incorporated by reference to Form 10-K filed by the Issuer with
the SEC on February 22, 2006).
99.6 Promissory Note of Mr. Clark payable to Flanders Corporation
dated April 24, 1999 (Intentionally omitted and incorporated by
reference to Form 10-K filed by the Issuer with the SEC on April
14, 2000).
99.7 Indemnity Agreement entered into by and between Mr. Clark and
Flanders Corporation.
99.8 Settlement Agreement between Mr. Clark, Flanders Corporation,
Robert R. Amerson, Harry L. Smith, Jr., Wal-Pat, LLC, and Mercury
Diecutting, LLC, dated October 3, 2007.