Northwest Pipe Co. President Brian Dunham resigned from the company Tuesday, more than six months after he stepped down as chief executive. The company is embroiled in corporate accounting problems and has become the subject of an investigation by the U.S. Securities and Exchange Commission.
The Vancouver-based maker of steel pipes announced Dunham’s departure Friday in a filing with the SEC. Richard Roman, CEO since April, will now also be president.
Friday’s news was the latest rumbling for a company that has seen challenges mount since November, when it announced it had delayed its third-quarter earnings report until it could resolve an internal investigation of accounting matters.
Since then, Northwest Pipe has been hit with a class-action lawsuit alleging the company issued “materially false and misleading financial statements,” and it has received multiple delisting warnings from the Nasdaq stock exchange. In July, the company disclosed in an SEC filing that it overstated profits by $37 million to $47 million over the course of a number of years. Northwest Pipe said it was developing restatements of past financial reports.
The first changes in the company’s leadership became public in April, when the company said Dunham had resigned his position as CEO, though he remained as president and a board member. Roman, a member of the company’s board since 2003, was named new CEO.
Roman served as president of Columbia Ventures Corporation — a private investment company — and previously was a partner at the accounting firm Coopers & Lybrand. He has served on the Northwest Pipe board’s audit committee, which is investigating accounting issues.
Under the terms of Dunham’s severance agreement, Northwest Pipe will pay him $570,000 — an amount equal to his base salary — over the next 12 months, according to Friday’s SEC filing. During that period, Dunham will serve as a consultant to the company, and it will pay the premiums to continue his health insurance.
Dunham has agreed to repay “all amounts he received as severance” if he is found by a court to have “engaged in intentional or reckless illegal activity” involving “accounting practice, policy, procedures or disclosures” related to the investigation into accounting matters by the audit committee of the company’s board, according to the company’s SEC filing.
Northwest Pipe moved its headquarters from Portland to Vancouver in March 2008. The company, which manufactures welded steel pipe and other products, has operations in the U.S., Mexico and Indonesia. Its large-diameter pipes serve the water transmission market. Its smaller-diameter tubular products serve industrial, energy, construction and other markets.
