Attached files
| file | filename |
|---|---|
| EX-4.1 - ZANETT INC | v180357_ex4-1.htm |
| EX-10.3 - ZANETT INC | v180357_ex10-3.htm |
| EX-10.1 - ZANETT INC | v180357_ex10-1.htm |
| EX-10.2 - ZANETT INC | v180357_ex10-2.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
report (Date of earliest event reported) March 31,
2010
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Zanett,
Inc.
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(Exact
name of registrant as specified in its
charter)
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Delaware
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001-32589
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56-4389547
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(State
or other jurisdiction
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(Commission
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(IRS
Employer
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|
of
incorporation)
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File
Number)
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Identification
No.)
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10022
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|
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code: (212)
583-0300
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(Former
name or former address, if changed since last
report)
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Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General
Instruction A.2. below):
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Explanatory
Note
On April 6, 2010, Zanett, Inc. filed a
Current Report on Form 8-K (the "Original Filing") announcing,
among other things, the Company's consummation of a financing transaction with
Rockport Investments Ltd., including the issuance of a promissory note
convertible into common stock of the Company, par value $0.001 per
share. This amendment corrects an error in the initial conversion
price applicable to such convertible note in the third and fourth paragraphs of
Item 1.01 and makes corresponding corrections in Exhibit 4.1 to the Original
Filing. For the sake of convenience, this Current Report on Form
8-K/A amends and restates the Original Filing in its entirety.
Item
1.01. Entry into a Material Definitive
Agreement.
On March 31, 2010, Zanett, Inc. (the
"Company") entered into
a Term Debt – Convertible Debt Exchange Agreement (the "Exchange Agreement") with
Rockport Investments Ltd. (the "Investor"), pursuant to which
the Company issued to the Investor a promissory note, convertible into common
stock of the Company, par value $0.001 per share (the "Common Stock"), in the
aggregate principal amount of $7,131,983 (the "Convertible
Note"). The Company issued issue the Convertible Note in
exchange for two promissory notes aggregating $5,325,000 issued by the Company's
wholly-owned subsidiary, Zanett Commercial Solutions, Inc. (the "Promissory Notes"), and a line
of credit to extend to the Company up to $3,000,000 (the "Line of Credit"), all
currently held by the Investor and which matured on March 31, 2010 (extended
from March 15, 2010 pursuant to the terms of the Exchange
Agreement). The Convertible Note was issued pursuant to the private
placement exemption under Section 4(2) of the Securities Act of 1933, as
amended. The Company did not receive any proceeds from the issuance
of the Convertible Note.
The Convertible Note bears interest at
7.95% per annum, payable quarterly in arrears on March 31, June 30, September 30
and December 30 of each year, beginning on June 30, 2010. The
Convertible Note matures on March 31, 2015. The Convertible Note is
convertible into shares of Common Stock at the option of the Investor at any
time from and after approval by the Company's stockholders of the terms of the
Convertible Note, expected to occur at the Company's 2010 Annual Meeting of
Stockholders. Such approval is required by Nasdaq rules, as the
conversion may result in the issuance of greater than 19.99% of the Company's
Common Stock outstanding immediately prior to the transaction and may also
constitute a change of control because of voting rights granted to the
Investor. The Company's Chairman and Chief Executive Officer (and the
owner of approximately 24.1% of the Company's Common Stock outstanding
immediately prior to the issuance of the Convertible Note), Claudio Guazzoni,
the Company's largest stockholder and uncle of Claudio Guazzoni, Bruno Guazzoni,
the Company's President and Chief Financial Officer, Dennis Harkins, and the
President of the Company's wholly-owned subsidiary, Zanett Commercial Solutions,
Inc., Charles Deskins, all entered into an agreement with the Company on March
31, 2010 to vote in favor of such proposal. The aggregate voting
power of the foregoing stockholders of the Company is approximately
53.9%.
The initial conversion price of the
principal and any accrued but unpaid interest on the Convertible Note is $1.99
per share (representing the closing bid price of the Common Stock immediately
preceding the issuance of the Convertible Note), but the Investor, may, at its
option, reset the conversion price once per calendar year to the greater of (a)
the average of the closing sales price of the Common Stock during the preceding
20 consecutive trading day period and (b) $0.10. The conversion price
is also subject to adjustment in the event of dilutive issuances by the Company
or the Company's issuance of options, warrants or other rights to purchase
Common Stock or convertible securities (subject to certain exceptions, including
the grant of options to purchase Common Stock to employees, officers, directors
or consultants of the Company).
In addition, the Investor will have the
right to vote on all matters submitted to a vote of stockholders of the Company
on an as-converted basis (calculated using the initial conversion price of
$1.99), although this voting right will not become effective until the Company's
stockholders approve the terms of the Convertible Note that (1) provide for the
potential issuance of more than 19.99% of the Common Stock (on a pre-transaction
basis) upon conversion of the Convertible Note by the Investor and (2) grant
this voting power to the Investor. Pursuant to the terms of the
Convertible Note, effective upon such stockholder approval, the Investor would
have the right to vote approximately 28% of the Company's Common Stock; however,
the Investor has entered into a voting agreement with the Company's Chairman and
Chief Executive Officer (and owner of approximately 24.1% of the Company's
Common Stock outstanding immediately prior to the issuance of the Convertible
Note), Claudio Guazzoni, pursuant to which it has appointed Mr. Guazzoni as its
proxy to exercise such voting rights in his discretion at all meetings of
stockholders of the Company beginning upon such stockholder approval and
continuing so long as any amount remains outstanding under the Convertible
Note. Therefore, taking Mr. Guazzoni's stock holdings together with
those shares over which he will act as proxy upon stockholder approval, Mr.
Guazzoni will have the ability to control the vote in all matters put to a vote
of stockholders of the Company so long as the Convertible Note is
outstanding. Due to Mr. Guazzoni's interest in the transaction, the
Company's Board of Directors excluding Mr. Guazzoni reviewed and approved the
transaction.
Payment at maturity of the Convertible
Note on March 31, 2015 will be made solely in cash or solely in Common Stock, at
the option of the Investor. The Company may prepay the Convertible
Note at any time, subject to a prepayment premium. The Company may
request that the Investor accept any prepayments of principal and/or any
scheduled payments of interest in shares of Common Stock, but the Investor is
not required to accommodate the Company's request. If the Company
were to make all payments of principal and interest in Common Stock, the maximum
number of shares that could be issued would be 99,699,463 shares (calculated
using the threshold conversion price of $0.10 per share).
In addition to payment at maturity, the
Investor may, by notice in writing to the Company upon the occurrence and during
the continuation of an "Event of Default" (as defined below), declare the
principal of the Convertible Note then outstanding to be due and payable
immediately. "Event of Default" means the occurrence of any of the
following: (i) a default in the payment of principal or interest on
the Convertible Note that continues uncured for 15 business days, (ii) failure
by the Company to deliver the required number of shares of Common Stock upon
surrender of the Convertible Note for conversion in accordance with its terms,
(iii) breach by the Company of any other covenant in the Convertible Note that
remains uncured for 30 days, or (iv) bankruptcy or insolvency of the
Company.
Item
2.03. Creation of a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet Arrangement of a
Registrant.
The
information included in Item 1.01 above regarding the Convertible Note is
incorporated by reference into this Item 2.03.
Item
3.02. Unregistered Sales of Equity
Securities.
The
information included in Item 1.01 above regarding the Convertible Note is
incorporated by reference into this Item 3.02.
Item
5.02. Departure of Directors or Certain
Officers; Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
On April 1, 2010, William H. Church
notified the Company that he is declining to stand for re-election as a director
of the Company. Mr. Church's one-year term will expire at the
Company's 2010 Annual Meeting of Stockholders.
Item
9.01. Financial Statements and
Exhibits.
(d)
Exhibits.
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Exhibit No.
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Description
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4.1
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7.95%
Convertible Note due March 31, 2015
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10.1
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Term
Debt-Convertible Debt Exchange Agreement between Zanett, Inc. and Rockport
Investments Ltd. dated as of March 31, 2010
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10.2
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Voting
Agreement among Zanett, Inc., Claudio M. Guazzoni and Rockport Investments
Ltd. dated as of March 31, 2010
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10.3
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Transaction
Approval Agreement among Zanett, Inc., Claudio M. Guazzoni, Bruno
Guazzoni, Dennis Harkins and Charles
Deskins
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SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
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ZANETT,
INC.
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Date: April
7, 2010
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By:
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/s/
Dennis Harkins
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Dennis
Harkins
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Chief
Financial Officer
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EXHIBIT
INDEX
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Exhibit No.
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Description
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4.1
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7.95%
Convertible Note due March 31, 2015
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10.1
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Term
Debt-Convertible Debt Exchange Agreement between Zanett, Inc. and Rockport
Investments Ltd. dated as of March 31, 2010
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10.2
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Voting
Agreement among Zanett, Inc., Claudio M. Guazzoni and Rockport Investments
Ltd. dated as of March 31, 2010
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10.3
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Transaction
Approval Agreement among Zanett, Inc., Claudio M. Guazzoni, Bruno
Guazzoni, Dennis Harkins and Charles
Deskins
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