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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): December 26, 2000
The Translation Group, Ltd.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 000-21725 23-3382869
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(State of Incorporation) (Commission File Number) (IRS Employer
Identification Number)
30 Washington Avenue, Haddonfield, NJ 08033
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(Address of Principal Executive Offices) (Zip Code)
(856) 795-8669
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(Registrant's Telephone Number, Including Area Code)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
As of December 26, 2000, the Translation Group, Ltd. (the "Company"),
announced an executory agreement ("Executory Agreement") to acquire all of the
outstanding shares of Applied Knowledge Systems International, Ltd. ("AKSI").
AKSI, through a wholly owned subsidiary, owns the Gedanken System (TM), a
patented translation technology.
The Gedanken System utilizes a series of libraries that dissect,
understand, and store knowledge in a given language, for a given topic. A
particular library may, for example, contain knowledge of financial information,
medical information, or how a specific company communicates its way of doing
business and expressing itself. The Gedanken System is designed to use these
knowledge libraries to transform information in one language to another language
while absolutely preserving the original meaning, message, and style in the new
language. It is intended to do this at a fraction of the time and cost required
to achieve similar results using human or machine translation resources. The
Company is accepting the Gedanken System on an "as-is" basis, based upon its
collaborative efforts with AKSI over several years under a 1997 licensing
agreement ("1997 Agreement").
The purchase price for the AKSI shares will be a number of shares of
the Company's common stock, par value $.001 per share, equal to the issued and
outstanding shares of the Company (approximately 4.9 million) at the time of the
closing of the Executory Agreement ("Closing"). In addition, the Company is
obligated to grant AKSI shareholders the right to purchase additional shares of
the Company's common stock in an amount equal to the number of public warrants
exercised by the holders thereof, if any, at a price equal to the exercise price
for the public warrants. The Company is also obligated to provide working
capital to AKSI in the amount of $100,000 per month until the Closing, up to
$600,000, for the continued commercialization, engineering, documentation,
service and marketing of the Gedanken System. Finally, upon the Closing the 1997
Agreement will be superseded.
There are two principal conditions precedent under the Executory
Agreement that the Company must satisfy prior to the Closing. Each condition
precedent must be satisfied or waived within six months from the execution of
the Executory Agreement. First, the Company is obligated to provide or secure
funding, to provide working capital for the Gedanken System, in the amount of
$4,000,000, which may be obtained, at the Company's discretion, from the sale of
assets or the sale of shares of the Company. AKSI shareholders have
anti-dilution rights to the extent that any of the $4,000,000 is raised by the
sale of Company shares. Second, the Company is obligated to sell or otherwise
dispose of any of the Company's subsidiaries that are not profitable for the
three consecutive months commencing on January 1, 2001. If the Company fails to
satisfy either of the aforesaid conditions precedent, the Closing will not occur
and the Company and AKSI will revert to their respective positions under the
1997 Agreement.
Simultaneous with the Closing the Board of Directors of the Company
will be reconstituted to consist of seven Directors, four of whom shall be named
by AKSI shareholders.
The terms of the transaction were determined by arms' length
negotiation between the parties. A founder and former shareholder of AKSI, Dr.
Julius Cherny, was a Director of the Company from May 1996 to November 1998 and
employed as an executive officer at a subsidiary of the Company from September
1997 to November 1998. However, in 1998 Dr. Cherny resigned from the Board of
the Company, and since 1998 has worked with AKSI developing the Gedanken System.
Dr. Cherny's spouse is the single largest holder of AKSI shares.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements of Business Acquired
As of the date of this Report, it is impractical to file the financial
statements required by Form 8-K. Such financial statements shall be
filed by amendment within sixty (60) days of the date of this Report.
(b) Pro Forma Financial Information
As of the date of this Report, it is impractical to file the pro forma
financial information Required by Form 8-K. Such pro forma financial
information shall be filed by amendment within sixty (60) days of the
date of this Report.
(c) Exhibits
None
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereto duly authorized.
Date: January 10, 2001
The Translation Group, Ltd.
By: /s/Randy G. Morris
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Randy G. Morris
President and CEO
