Form 8-K - Current report

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.

	Exhibit No.		Description

	10.1		Amendment to Share Purchase Agreement dated August 31, 2021 by and among Transcat, Inc., John Cummins and Ross Lane, dated May 20, 2024
	104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

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.

		TRANSCAT, INC.

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

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”).

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:

Definitions. Capitalized terms used and not defined in this Amendment have the respective meanings assigned to them in the Agreement.

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).”

Removal Earn-Out Provision. Section 1.6 of the Agreement is deleted in its entirety, and replaced with the following:

“1.6. Intentionally Omitted.

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”.

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,”.

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,”.

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”.

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”.

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

	SELLERS:

	/s/ John Cummins
	John Cummins

	/s/ Ross Lane
	Ross Lane

[signature page to Second Amendment to Share Purchase Agreement]

Cover	May 20, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	May 20, 2024
Entity File Number	000-03905
Entity Registrant Name	Transcat, Inc.
Entity Central Index Key	0000099302
Entity Tax Identification Number	16-0874418
Entity Incorporation, State or Country Code	OH
Entity Address, Address Line One	35 Vantage Point Drive
Entity Address, City or Town	Rochester
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	14624
City Area Code	585
Local Phone Number	352-7777
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.50 par value
Trading Symbol	TRNS
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false