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
October 13,
2008
Date of Report
[Date of Earliest Event Reported]
DIGITILITI, INC.
(Exact name of Registrant as specified in
its Charter)
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Delaware
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0001-53235
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26-1408538
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(State or Other Jurisdiction of
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(Commission File Number)
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(I.R.S. Employer Identification
No.)
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Incorporation)
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266 East 7
th
Street,
4
th
Floor
St. Paul, Minnesota 55101
(Address of Principal Executive
Offices)
(651) 925-3200
(Registrants Telephone Number, including
area code)
N/A
(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 (see general instruction A.2.
below):
[ ] Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant
to Rule 14-a-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 5.02 Departure of Directors or Principal
Officers; Election of Directors; Appointment of Principal Officers.
On October 13, 2008, Larry D. Ingwersen (Ingwersen)
tendered his resignation as a director and the President and CEO of the
Company, effective as of October 13, 2008; and Roderick D. Johnson
(Johnson) tendered his resignation as the Chief Operating Officer of the
Company, also effective October 13, 2008. The Company accepted these
resignations at a special meeting of the Board of Directors held on such
date.
5X Partners, LLC (5X), of which Messrs. Ingwersen
and Johnson are believed to each be 50% partners and owners, also
gave the 10 day termination notice terminating the 5X Corporate Development
Services Agreement with the Company dated August 20, 2007, and the two Addendums
thereto respectively dated November 15, 2007, and dated May 8, 2008, but
effective April 17, 2008, in the same communication (the 5X Agreements).
Additionally, in addition to
other business conducted at the special meeting of the Board of Directors held
October 13, 2008, the Board of Directors:
1. Agreed
to continue as a seven person Board.
2. Laura
Wenzel indicated her resignation from the Board, effective immediately.
This left three vacancies on the Board resulting from the resignations of Larry
D. Ingwersen and Laura Wenzel and the open board position.
3. The
Board elected Roy A. Bauer and Benno G. Sand as directors to fill two of the
vacancies, effective on October 13, 2008.
4. Daniel
J. Herbeck was elected as a director to fill the remaining vacancy, and was
elected as the President and CEO to fill the vacancies resulting from the
resignation of Mr. Ingwersen from these positions, effective October 13,
2008.
5. The
Board accordingly now consists of Brad Wenzel, Mark Savage, Jonathan S. Miner,
Pamela Miner, Roy A. Bauer, Daniel J. Herbeck and Benno G. Sand.
6. An
oversight committee consisting of Roy A. Bauer, Brad Wenzel and Jonathan S.
Miner was appointed to conduct a 30, 60 and 90 day evaluation of Mr. Herbecks
performance as President and CEO. It was agreed that Mr. Bauer also would
work with the Company to establish Mr. Herbecks job duties and expectations and
work out a compensation package.
7. Mr.
Bauer was granted an option to purchase 125,000 shares to vest over a three year
period at an exercise price per share to be determined.
8. It was
agreed that the position of Chief Operating Officer, which was left vacant by
the resignation of Roderick D. Johnson, would not be filled at this time.
Daniel J. Herbeck
Mr. Herbeck is 51 years of age. From 2002 to the
present, Mr. Herbeck has been the owner and President of Continental Technology
Solutions, LLC, a St. Paul, Minnesota, management consulting firm facilitating
specializing in strategic and operational development, technology
infrastructure, process control and M/A activity.
Roy A. Bauer
Mr. Bauer is 63 years of age. From January of 2007
to the present, Mr. Bauer has been the CEO of Key Teknowledgy, a management
consulting firm based in Wisconsin. This corporation specializes in
strategy, business transformation and quality improvement services for
international clients. From May of 2001 to January of 2007, Mr. Bauer
served as Vice President, General Manager, Rochester Pemstar Manufacturing Site;
Executive Vice President, Pemstar United States Operations; Executive Vice
President, WW Operations; Executive Vice President, Chief Operating Officer; and
President and Chief Operating Officer of Pemstar Corporation of Rochester,
Minnesota, an international manufacturer of electronic circuit boards, precision
electro-mechanical devices, optical devices and computer systems.
Benno G. Sand
Mr. Sand is 54 years of age. He has served as
Executive Vice President, Business Development and Investor Relations of FSI
International, Inc. (FSI) since January 2000. FSI is a global supplier
of surface conditioning equipment and technology to the worlds leading
integrated circuit (IC) and microelectronics manufacturers. He also
served as Executive Vice President of FSI since January 1992 and Secretary since
March 2002. Mr. Sand also served as Chief Administrative Officer of
FSI from January 1998 to December 1999, as Chief Financial Officer from October
1990 to January 1998, and as Vice President of Finance from October 1987 to
January 1992. Mr. Sand is a director of various FSI-owned United
States and foreign subsidiaries as well as mFSI LTD and MathStar, Inc.
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Item 7.01
Regulation FD Disclosure.
See Exhibit 99.6 Press Release dated October 16, 2008, a
copy of which is attached hereto and incorporated herein by reference.
Effective October 13, 2008, the Board of Directors accepted the
resignation of Larry D. Ingwersen as a Board member and as President and CEO of
the Company; and also accepted the resignation of Roderick D. Johnson as Chief
Operating Officer. Also effective October 13, 2008, Laura Wenzel tendered
her resignation as a member of the Board of Directors and Daniel J. Herbeck,
Benno G. Sand and Roy A. Bauer were elected to the Board of Directors to fill
the vacancies left by the resignations of Mr. Ingwersen and Ms. Wenzel as well
as the open Board position. Mr. Herbeck was also elected as Chief Executive
Officer and President of the Company.
Item 8.01 Other Events.
Effective October 13, 2008, the Board of Directors
approved the offer and sale to one (1) accredited investor only, of a
Convertible Note and Warrants described as follows:
A 12% Convertible Note in the amount of $250,000 with a
maturity date that is six (6) months from the date of issuance (the Convertible
Note) that comes within the definition of restricted securities in Rule 144
of the Securities and Exchange Commission and that is convertible into common
stock of the Company that also comes within such definition of restricted
securities (the Common Stock) at $0.50 per each share; together with 150,000
warrants (the Warrants), with a five year term and exercisable at $0.50 per
share of Common Stock, that are also restricted securities, including the
underlying Common Stock.
Jonathan S. Miner, a director of the Company, has agreed
to execute a Guaranty of payment of the $250,000 and a Confession of Judgment
pursuant to Minn. Stat. § 548.22 that allows the district court to enter
judgment without action. To do so, the person confessing judgment must
authorize the entry of judgment pursuant to a written confession that is
typically not filed with the court until a default occurs. The
Convertible Note provides for a 30 day grace period following any default of the
terms of the Convertible Note.
In connection with the Guaranty and Confession of
Judgment, Mr. Miner will also receive 100,000 warrants with a five year term
exercisable at $0.50 per share of Common Stock. These warrants and the
underlying Common Stock are also restricted securities.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No.
Exhibit Description
99.1
12% Convertible Note
99.2
Warrant (Elmer R. Salovich)
99.3
Guaranty
99.4
Confession of Judgment
99.5
Warrant (Jonathan S. Miner)
99.6
Press Release
SIGNATURES
Pursuant to the requirements of the
Securities and Exchange Act of 1934, the Registrant has duly caused this Current
Report to be signed on its behalf by the undersigned hereunto duly
authorized.
DIGITILITI, INC.
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Date:
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October 13, 2008
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By:
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/s/ Daniel J. Herbeck
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Daniel J. Herbeck
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President
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