The Reporting Persons purchased the securities of the Issuer reported herein based on their belief that the securities were undervalued and represented an attractive investment opportunity. The Reporting Persons were previously members of a "group" (within the meaning of Section 13(d)(3) of the Exchange Act) with the Moab Parties. Effective as of August 10, 2016, such group has been terminated and the Reporting Persons specifically disclaim group status with the Moab Parties. On August 9, 2016, the Reporting Persons entered into a Standstill Agreement (the "Standstill Agreement") with the Issuer whereby William C. Taylor, James A. Ratigan and John F. Bryant (collectively, the "New Directors") were appointed to the Issuer's Board of Directors. The New Directors fill vacancies left by the resignations of Kenneth R. Dabrowski and Philip J. DeCocco and the expansion of the Issuer's Board of Directors from six to seven members. The Issuer has agreed to nominate, recommend and support the New Directors at the 2016 Annual Meeting of the Shareholders of the Issuer. The Standstill Agreement requires that the Reporting Persons vote all Shares of the Issuer that they beneficially own for each of the Issuer's nominees for election to the Issuer's Board of Directors, in favor of the Issuer's "say-on-pay" proposals, for the ratification of the appointment of independent auditors and, in other matters, in accordance with the recommendation of the Issuer's Board of Directors. Pursuant to the Standstill agreement, the Reporting Persons have also agreed to certain customary standstill and voting provisions. The Standstill Agreement generally terminates on the date that is thirty days prior to the deadline for a shareholder to submit nominations at the 2017 Annual Meeting of the Shareholders of the Issuer. On August 9, 2016, Mr. Bryant executed (i) a Non-Disclosure Agreement in the form attached as Exhibit A to the Standstill Agreement (the "Non-Disclosure Agreement") and (ii) a Joinder Agreement in the form attached as Exhibit A to the Non-Disclosure Agreement pursuant to which Mr. Bryant became a party to the Standstill Agreement. The foregoing description is qualified in its entirety by reference to the Standstill Agreement, Non-Disclosure Agreement, and the Joinder Agreement, which are incorporated by reference to Exhibits 10.1, 10.5, and 10.8, respectively to the Form 8-K filed by the Issuer with the Securities and Exchange Commission on August 10, 2016. The Reporting Persons have had conversations with the Issuer's management regarding possible ways to enhance shareholder value. Consistent with the Standstill Agreement, the Reporting Persons intend to have additional conversations with the Issuer's management and Board of Directors. These conversations have covered and are expected to continue to cover a range of issues, including those relating to the business of the Issuer; board composition; management; operations; capital allocation; asset allocation; capitalization; dividend policy; financial condition; mergers and acquisitions strategy; overall business strategy; executive compensation; and corporate governance. The Reporting Persons have also had similar conversations with other stockholders of the Issuer and other interested parties, such as industry analysts, existing or potential strategic partners or competitors, investment professionals, and other investors. Consistent with the Standstill Agreement, the Reporting Persons may at any time reconsider and change their intentions relating to the foregoing. |