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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) |
May 20, 2024 |
Transcat,
Inc. |
(Exact name of registrant as specified in its charter) |
Ohio |
000-03905 |
16-0874418 |
(State or other jurisdiction |
(Commission |
(IRS Employer |
of incorporation) |
File Number) |
Identification No.) |
35 Vantage Point Drive, Rochester, New York |
14624 |
(Address of principal executive offices) |
(Zip Code) |
Registrant's telephone number, including area code |
(585) 352-7777 |
|
(Former name or former address, if changed since last report) |
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:
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
|
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
|
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
|
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Common Stock, $0.50 par value |
TRNS |
Nasdaq Global Market |
Indicate by check mark whether the registrant is an emerging growth company
as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of
1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ |
Item 1.01 |
Entry into a Material Definitive Agreement. |
On May 20, 2024, Transcat, Inc.
(the “Company”) entered into an amendment (the “Second Amendment”) to a Share Purchase Agreement dated August
31, 2021 (the “Purchase Agreement”) with John Cummins and Ross Lane (the “Sellers”) as amended on September 11,
2023 (the “First Amendment”), associated with the Company’s purchase of all of
the outstanding capital stock of Cal OpEx Limited (d/b/a NEXA Enterprise Asset Management), a private Irish company which owns all of
the issued and outstanding capital stock of its U.S.-based subsidiary, Cal OpEx Inc., a Delaware corporation (collectively, “NEXA”).
The
Second Amendment amends the Purchase Agreement to remove the Sellers’ entitlement to potential earn-out payments (as defined
in the Purchase Agreement). Pursuant to the Second Amendment, no earn-out payment will be due for earn-out year 1, an earn-out
payment of $527,627 will be made for earn-out year 2, and no earn-out payment will be due for any future earn-out year (each as
defined in the Purchase Agreement). In connection with the Second Amendment, the Company terminated its employment agreement with
Mr. Cummins, Vice President of NEXA, and entered into an employment offer letter with Mr. Cummins whereby he will serve as
NEXA’s Vice President of Global Strategic Partnerships.
Except
as set forth above, the terms of the Purchase Agreement and the First Amendment remain unchanged.
The
foregoing summary of the Second Amendment does not purport to be complete and is qualified in its entirety by reference to the full text
of the Second Amendment filed herewith as Exhibit 10.1 to this Current Report on Form 8-K.
Item 9.01 |
Financial Statements and Exhibits. |
(d) Exhibits.
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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TRANSCAT, INC. |
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|
|
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Dated: May 20, 2024 |
|
By: |
/s/ Thomas L. Barbato |
|
|
Name: |
Thomas L. Barbato |
|
|
Title: |
Senior Vice President of Finance and Chief Financial Officer |
Exhibit 10.1
SECOND AMENDMENT TO
SHARE PURCHASE AGREEMENT
This Second Amendment to Share Purchase Agreement (this
“Amendment”) is made and effective as of May 20, 2024 (the “Amendment Effective Date”), by and between
TRANSCAT, INC., an Ohio corporation (“Buyer”), and JOHN CUMMINS and ROSS LANE (each, a “Seller”
and, collectively, “Sellers”). Buyer and Sellers are referred to herein, individually, as a “Party”
and together as the “Parties”.
Recitals
A.
The
Parties entered into a Share Purchase Agreement dated August 31, 2021, as amended by a First Amendment to Share Purchase Agreement dated
as of September 11, 2023 (collectively, the “Agreement”).
B.
Pursuant
to Section 8.5 of the Agreement, the Parties desire to further amend the Agreement to reflect the removal of the Earn-Out Payments, as
set forth herein.
NOW, THEREFORE, in consideration of the foregoing and
of the mutual promises and conditions hereinafter set forth, the Parties agree as follows:
1.
Definitions.
Capitalized terms used and not defined in this Amendment have the respective meanings assigned to them in the Agreement.
2.
Purchase
Price. Section 1.2(a) of the Agreement is amended and restated in its entirety to read as follows:
“(a) Purchase
Price. Subject to the provisions of this Agreement (including, without limitation, the adjustments set forth in Section 1.3), the
total purchase price (the “Purchase Price”) for the Company Shares shall be an amount equal to (i) $22,500,000 (the
“Closing Consideration”) plus (ii) the Closing Cash, as calculated and adjusted pursuant to Section 1.3. The Purchase
Price (including the Closing Consideration and any portion of the Escrow Amount released to Sellers pursuant to Section 1.5 and the Escrow
Agreement) shall be allocated between Sellers pro rata based on their respective ownership of the Company Shares. Subject to adjustment
as provided in this Agreement including, without limitation, Section 1.3, Section 1.4 and Section 1.5, the Closing Consideration shall
be payable to Sellers in accordance with the provisions of Section 1.2(b).”
3.
Removal
Earn-Out Provision. Section 1.6 of the Agreement is deleted in its entirety, and replaced with the following:
“1.6. Intentionally Omitted.
4.
Amendment
to Section 2.2(a)(v). Section 2.2(a)(v) of the Agreement is amended to delete the words “or as Earn-Out Payment, if applicable”.
5.
Amendment
to Section 3.27. The second sentence of Section 3.27 of the Agreement is amended to delete the words “, as payment of such Earn-Out
Payment,”.
6.
Amendment
to Section 4.9. The last sentence of Section 4.9 of the Agreement is amended to delete the words “, as payment of such Earn-Out
Payment,”.
7.
Amendment
to Section 7.8. The first sentence of Section 7.8 of the Agreement is amended to delete the words “including, without limitation,
the Earn-Out Payments”.
8.
Amendment
to Section 9.1. Section 9.1 of the Agreement is amended to delete the definitions of “Change of Control”, “Consolidated
EBITDA”, “Earn-Out Due Date”, “Earn-Out Year”, and “EBITDA”.
9.
Amendment
to Section 9.2. Section 9.2 of the Agreement is amended to delete the following definitions from the table set forth therein: “Accelerated
Years” and “Change of Control Payment”.
10.
Deletion
of Schedule B. Schedule B to the Agreement is hereby deleted in its entirety.
11.
Deletion
of Schedule C. Schedule C to the Agreement is hereby deleted in its entirety.
12.
Acknowledgment.
The Parties agree that (i) Buyer shall pay to Sellers, in accordance with
the terms of the Agreement, an Earn-Out Payment in the aggregate amount of $527,627 for Earn-Out Year 2 (2023), in full satisfaction of
Buyer’s obligation to pay any Earn-Out Payment for such Earn-Out Year; (ii) no Earn-Out Payment was or will be due, pursuant to
the terms of the Agreement, for Earn-Out Year 1 (2022); and (iii) no Earn-Out Payment will be due, pursuant to the terms of the Agreement,
for any Earn-Out Year ending after the Amendment Effective Date.
13.
Effect
on Agreement. Except as set forth in this Amendment, the Agreement shall continue in full force and effect in accordance with its
terms.
14.
Counterparts.
This Amendment may be executed in one or more counterparts, each of which together shall constitute one and the same Amendment. For purposes
of executing this Amendment, a PDF image delivered via email or a facsimile copy of this Amendment, including the signature pages, will
be deemed an original.
[signature page follows]
IN WITNESS WHEREOF, the Parties
have caused this Amendment to be executed by their duly authorized officers, effective as of the Amendment Effective Date.
|
TRANSCAT, INC. |
|
|
|
|
|
By: |
/s/ Lee D.
Rudow |
|
|
Name: Lee D. Rudow |
|
|
Title: President and CEO |
|
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SELLERS: |
|
|
|
|
|
/s/
John Cummins |
|
|
John Cummins |
|
|
|
|
|
/s/ Ross
Lane |
|
|
Ross Lane |
|
[signature page to Second Amendment to Share Purchase
Agreement]
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