UPDATE: USA Truck Expands Board of Directors for Largest Shareholders

USA Truck Inc. of Van Buren (NASDAQ: USAK) expanded its board of directors to make room for representatives from its largest shareholders.

Stone House Capital of New York City and Baker Street Capital of Los Angeles formed United Shareholders for the Benefit of USAK on May 6. Stone House owns 1,550,000 shares (14.7 percent) and Baker Street 1.4 million (13.3 percent) so the United group controls nearly 3 million shares (28 percent).

Arkansas Business first reported of the joining of the two groups May 7.

On Friday, USA Truck announced it would add former company executive Thomas Glaser and Vadim Perelman, the managing partner and chief investment officer of Baker Street Capital. USA Truck’s board of directors voted to expand its membership from seven to nine, which was allowed by the company’s corporate bylaws.

The United group formed too late to formerly submit representatives for election to the board of directors. USA Truck held its annual shareholders meeting Friday in Van Buren and reelected two directors, William Hanna and James Simpson, to three-year terms.

Bob Peiser, the chairman of USA Truck’s board, said officials have been in talks with United executives since the group formed. Peiser said he spoke with executives who had served on other boards with Perelman to ascertain his ability to work well with others.

“We’ve had discussions with them about their constructive nature of the board,” Peiser said. “We have a good board. We don’t want to change the character of the board. I spent a fair amount of time talking to Mr. Perelman about whether he is going to be disruptive or constructive on the board. I’m convinced he is a constructive guy.

“They deserve some voice in the room,” he said. “It’s easier to work with anybody if they are informed. I think they can really help us if they knew more.”

USA Truck CEO John Simone said the company had been planning to add a trucking expert to its board for some time, and Glaser fits that bill. Glaser worked for USA Truck as a consultant in 2012 and served as its interim chief operating officer.

“We’re looking forward to their input to help us accelerate our product,” Simone said. “The objectives are aligned in terms of enhancing shareholder value. They share those same views.”

Peiser said the two united companies had ideas how to speed along USA Truck’s turnaround and those ideas weren’t necessarily based on accurate information, information the executives will now have access to as board members.

“We are always looking for smart people to help us,” Peiser said. “[Perelman] is a very useful addition for because it will allow us to take advantage of his knowledge and talents with an informed view rather than an uninformed view. Tom obviously knows the company well.”

Perelman and Glaser released a joint statement after the agreement added them to the board.

“We are pleased to join USA Truck’s Board of Directors,” Perelman and Glaser said in a joint statement. “We look forward to working with management and the board to improve operational and financial performance. 

USA Truck has reported five consecutive years of annual net loss but reported narrowed losses and improved revenue in the first quarter of 2014. The company’s stock price has also increased from $6.46 in September 2013 to a Thursday closing price of $15.47.

The runup in stock price came after Knight Transportation of Phoenix announced a takeover bid in September. USA Truck later filed a breach of contract suit against Knight that was settled out of court in February.

Knight’s takeover attempt was held off in part because of USA Truck’s shareholders rights plan, which had a “poison pill” that kicked in if one individual or group acquired 15 percent of the company stock. USA Truck’s board decided to end the poison pill plan April 11.