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): SEPTEMBER 29, 2005
TECHTEAM GLOBAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-16284 38-2774613
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File No.) Identification No.)
27335 West 11 Mile Road
Southfield, Michigan 48034
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (248) 357-2866
__________________________________________________________________
(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))
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On September 29, 2005, Ford Motor Company ("Ford") issued new
Purchase Orders to extend TechTeam Global, Inc.'s ("TechTeam" or the
"Company") Ford Motor Company Global SPOC Contract from September 30,
2005 through November 30, 2005. The Purchase Orders amend the Purchase
Orders issued on July 27, 2005, as reported in the Company's Current
Report on Form 8-K dated July 28, 2005, and read:
2ND AMENDMENT: TO ADD FUNDS AND FOR 2ND 2 MONTH EXTENSION TO TERM
BRINGING THE EXPIRATION DATE TO 11/30/2005.
The July 27, 2005 Purchaser Orders stated:
THIS EXTENSION IS FROM AUGUST 1, 2005 THRU SEPTEMBER 30, 2005.
THIS AMENDMENT IS TO SAFEGUARD THE AGREEMENT FROM UNAUTHORIZED
COMMITMENT. ALL CONTRACT TERMS AND PRICING WILL REMAIN THE SAME.
IF THE NEW AGREEMENT AND PURCHASE ORDERS ARE ISSUED BEFORE JULY
31, 2005, THEN THIS AMENDMENT WILL BE VOID AND THE REQUISITIONER
WILL IMMEDIATELY PUT IN A REQUEST TO DELETE THIS AMENDMENT. IF
THE NEW AGREEMENT AND PURCHASE ORDERS ARE ISSUED BETWEEN AUGUST
1, 2005 AND SEPTEMBER 30, 2005, THEN THIS AMENDMENT WILL BE VOID
AND THE REQUISTIONER WILL CLOSE OUT ALL REMAINING FUNDS AFTER
RECEIVING THE FINAL INVOICE.
On September 29, 2005, TechTeam issued a Press Release reporting
this extension. A copy of the Press Release is attached as Exhibit
99.1.
On September 29, 2005, the Company entered into an employment
contract with Robert W. Gumber, Vice President of Operations EMEA. A
copy of the contract is attached as Exhibit 10.1. The contract
provides that, from October 1, 2005 through December 31, 2006, Mr.
Gumber will be employed as an expatriate in Belgium in the role of
Vice President of Operations EMEA. Mr. Gumber will earn a base salary
of $225,000. He will also participate in the Company's Annual
Incentive Plan. As an expatriate, the Company will also pay additional
compensation $5,000 per month for his expatriate services, as well as
other benefits standard with expatriate service, including a housing
allowance, not to exceed 4,000 euros per month. Until December 31,
2006, Mr. Gumber can be terminated only for cause as defined in the
agreement.
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ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS
On October 3, 2005, TechTeam Global, Inc. (the "Company"), together
with its subsidiary TechTeam Global NV/SA, completed the acquisition
of all of the outstanding equity in Akela Informatique SRL ("Akela")
from Akela's shareholders, Lucian I. Butnaru, Peter A. Ungureanu,
Sabin Girlea, Philippe Bozier, Alain Kremeur, and George Tudor
("Selling Shareholders"). As set forth in the Press Release, dated
October 3, 2005 and attached hereto as Exhibit 99.2, Akela provides
application development, migration, implementation, and maintenance
support services to clients in Romania, France, the United Kingdom,
Switzerland, Belgium, Italy, Sweden and the United States.
As set forth in the Share Purchase Agreement ("SPA"), attached as
Exhibit 2.01, the initial consideration paid by the Company was
euro2,700,000, which was comprised of euro2,450,000 in cash and
euro250,000 of Company's common stock. Of the initial cash
consideration, euro2,180,000 was paid to the Selling Shareholders, and
the remaining euro270,000 was placed into a holdback escrow for a
working capital true-up (euro135,000), and a representation and
warranties holdback (euro135,000). The number of shares issued will be
determined by converting euros into US dollars and dividing the sum by
the average stock price of the Company's common stock for the three
days prior to and after the transaction. The stock issued will be
restricted from sale for two years, and it will be held in escrow as
part of the representation and warranties holdback. The final purchase
price is subject to a working capital adjustment based upon the change
in Akela's net working capital position from December 31, 2004 through
October 3, 2005.
During calendar years 2006 and 2007, the Selling Shareholders may be
paid an additional amount based upon Akela's gross profit. If Akela's
gross profit exceeds euro1,330,000 in 2006, the Company will pay the
Selling Shareholders additional purchase price consideration of
euro100,000. If Akela's gross profit exceeds euro2,100,000 in 2007,
the Company will pay the Selling Shareholders additional purchase
price consideration of euro200,000. If Akela's aggregate gross profit
for 2006 and 2007 exceeds euro4,100,000, the Company will pay the
Selling Shareholders additional purchase price consideration of
euro50,000, and certain key employees of Akela will share in
additional compensation of euro100,000.
The funds used to consummate the acquisition were primarily from
available credit under the Loan Agreement detailed in the Company's
Current Report on Form 8-K dated January 5, 2005.
The statements contained in this press release that are not purely
historical, including statements regarding the Company's expectations,
hopes, beliefs, intentions, or strategies regarding the future, are
forward-looking statements
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within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Forward-looking statements include statements regarding,
among other things, the potential impact of this acquisition on the
Company's revenue and earnings performance going forward.
Forward-looking statements may be identified by words including, but
not limited to, "anticipates," "believes," "intends," "estimates,"
"promises," "expects," "should," "conditioned upon," and similar
expressions. Prospective investors are cautioned that any such
forward-looking statements are not guarantees of future performance
and involve risks and uncertainties, and that actual results may
differ materially from those projected in the forward-looking
statements as a result of various factors. Specifically, there are
significant risks associated with acquisitions, including the
Company's ability to successfully integrate this acquisition on a
timely basis, the retention of key employees, and the retention of key
customers. Further, there can be no assurance that it will have the
impact on the Company's financial condition and results of operations
contemplated in this release. The factors that could affect the
anticipated impact include but are not limited to the inability to
retain business or key employees of the acquired company. Prospective
investors are cautioned that any such forward-looking statements are
not guarantees that TechTeam will successfully renew the Global SPOC
Services Contract, or renew the specific terms on a basis as favorable
as the current contract. The forward-looking statements included in
this document are based on information available to the Company on the
date hereof, and the Company assumes no obligation to update any such
forward-looking statement. Prospective investors should also consult
the risks described from time to time in the Company's Reports on
Forms 8-K, 10-Q, and 10-K filed with the United States Securities and
Exchange Commission
ITEM 9.01 Financial Statements and Exhibits
(C) THE FOLLOWING EXHIBITS ARE INCLUDED WITH THE REPORT
EXHIBIT 2.01 Share Purchase Agreement between TechTeam Global, Inc., TechTeam
Global NV/SA and Akela Informatique SRL, Lucian I. Butnaru, Peter
A. Ungureanu, Sabin Girlea, Philippe Bozier, Alain Kremeur, and
George Tudor, dated October 3, 2005.
EXHIBIT 10.1 Employment and Non-competition Agreement between TechTeam Global,
Inc. and Robert W. Gumber, dated September 29, 2005.
EXHIBIT 99.1 Press Release of TechTeam Global, Inc. dated September 29, 2005.
EXHIBIT 99.2 Press Release of TechTeam Global, Inc. dated October 3, 2005.
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SIGNATURE
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 thereunto duly authorized.
TECHTEAM GLOBAL, INC.
By /s/ Michael A. Sosin
-------------------------------------
Michael A. Sosin
Vice President, General Counsel and
Secretary
Date: October 5, 2005
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EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
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2.01 Share Purchase Agreement between TechTeam Global, Inc., TechTeam
Global NV/SA and Akela Informatique SRL, Lucian I. Butnaru, Peter
A. Ungureanu, Sabin Girlea, Philippe Bozier, Alain Kremeur, and
George Tudor, dated October 3, 2005.
10.1 Employment and Non-competition Agreement between TechTeam Gloabl,
Inc. and Robert W. Gumber,dated September 29, 2005.
99.1 Press Release of TechTeam Global, Inc. dated September 29, 2005
99.2 Press Release of TechTeam Global, Inc. dated October 3, 2005