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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
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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): August 23, 2000
ADVANCED TECHNOLOGY INDUSTRIES, INC.
(Exact name of registrant as specified in charter)
DELAWARE 0-23761 33-0751685
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) file number) Identification No.)
Taubenstrasse 20, D-10117, Berlin, Germany 10117
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: 011 49 30 201 7780
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Kurchatov Research Holdings, Ltd.
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(Former name or former address, if changed since last report)
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Item 2. Acquisition or Disposition of Assets
Transactions Reported
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This Current Report reports two transactions entered into by Advanced
Technologies Industries, Inc. ("ATI" or "Company") to wit: (i) a transaction
entered into between ATI and Nurescell, Inc. involving the formation of a
company named Nurescell AG to be jointly owned by them and the entering into of
certain agreements between Nurescell, Inc. and Nurescell AG, and (ii) an
agreement entered into between shareholders of Nurescell, Inc. and ATI whereby
ATI is to acquire 3,500,000 shares of the $.0001 par value stock of Nurescell,
Inc. from said shareholders. On August 25, 2000 ATI issued a press release
relating to these transactions which is attached as Exhibit 99.1 to this Current
Report on Form 8-K.
Formation of Nurescell AG
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On August 23, 2000 ATI and Nurescell, Inc. entered into a transaction
involving the formation of a German company named Nurescell AG which is to be
owned 51% by Nurescell, Inc. and 49% by ATI.
As part of the transaction Nurescell AG entered into an Investment
Agreement with Nurescell, Inc. which reflects the percentage ownership interest
of Nurescell, Inc. and ATI in Nurescell AG and further provides that Nurescell
AG with ATI's assistance will use its best efforts to raise DM 20 Million
(approximately $9.1 Million) in capital for Nurescell AG. This capital will be
raised by the issuance of stock by Nurescell AG provided, however, that the
additional shares cannot exceed 34% of the outstanding stock of Nurescell AG,
and, further provided, that the dilution in ownership shall apply equally to
Nurescell Inc. and ATI.
The Investment Agreement further provides that for a period of five
years Nurescell AG has the right to acquire up to $4 Million of the stock of
Nurescell, Inc. from it. ATI is informed that Nurescell, Inc. has agreed to
increase said sum to $10 Million. Nurescell AG and Nurescell, Inc. have agreed
that the price for the stock will be 80% of the bid price of Nurescell Inc.
determined at specified times. Nurescell, Inc. is traded on the OTC Bulletin
Board. In addition, Nurescell AG has been granted the right to have the shares
registered at the expense of Nurescell, Inc. if the registration is incident to
the registration of other stock by Nurescell, Inc., or at the expense of
Nurescell AG if it demands registration of the stock other than incident to the
registration of other stock by Nurescell, Inc.
The Investment Agreement also provides for the immediate resignation of
Mr. William A. Wilson as President of Nurescell, Inc. and the election of Mr.
James Samuelson, a Vice-President and Chief Financial Officer of ATI, as
President of Nurescell, Inc. The agreement also provides for the appointment of
one director of Nurescell, Inc. by Mr. Samuelson.
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In addition, Nurescell AG and Nurescell, Inc. executed a License
Agreement whereby Nurescell, Inc. granted an exclusive license to Nurescell AG
in the countries of the former Soviet Union, the Continent of Europe, and the
British Isles to manufacture and market a proprietary technology owned by
Nurescell Inc. The license term is until August 15, 2020 or when certain patents
expire which have been applied for by Nurescell, Inc., whichever later occurs.
The technology being licensed is defined in the License Agreement by
Nurescell, Inc. as a novel material for shielding and internment of radioactive
materials and radioactive waste as well as providing attenuation of x-ray
energy. The License Agreement further states that the material demonstrates
shielding and physical properties superior to commonly used shielding materials
such as concrete, steel or, in some cases, lead.
The License Agreement provides for the payment of a license fee of
$1,000,000 to Nurescell, Inc. which sum is to be paid in four installments of
$250,000 each commencing upon the execution of the agreement and continuing each
quarter thereafter provided, however, that the entire $1,000,000 will be due at
the time that a minimum of $4,000,000 in capital is raised by Nurescell AG. ATI
has agreed to advance the $1,000,000 to Nurescell AG as the payments come due in
consideration for its 49% interest therein. ATI is entitled under the agreement
to obtain credit against the $1,000,000 for certain sums advanced by it for the
formation of Nurescell AG. ATI has advanced the initial payment of $250,000
which has been paid to Nurescell, Inc . The source of these funds was the
working capital of ATI.
The 51% interest of Nurescell, Inc. in Nurescell AG was acquired by it
as additional consideration for the granting of the license to Nurescell AG.
The license fee was arrived at between Nurescell, Inc. and ATI as a
result of negotiations between those parties. ATI investigated the application
of this technology in the Russian and European markets and determined that there
was a viable market for this technology and the payment of the $1,000,000 was
reasonable for the acquisition of a 49% interest in Nurescell AG.
For a complete description of the terms of the transactions described
above, reference is made to the Investment Agreement including the Registration
Rights Agreement attached as Exhibit B thereto and the License Agreement between
Nurescell, Inc. and Nurescell AG which are attached as exhibits to this Current
Report on Form 8-K.
Agreement To Purchase Nurescell Stock
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On August 23, 2000 ATI entered into an Agreement For Purchase Of Stock
("Agreement") with Adrian Joseph and his wife Dianna Joseph (the "Josephs") to
purchase 3,500,000 shares of the $.0001 par value common stock of Nurescell,
Inc. owned by them in consideration for the issuance to the Josephs of 3,500,000
shares of the $.0001 par value common stock of ATI. In addition, the Agreement
provides that the Josephs may receive up to an additional 2,000,000 shares of
the common stock of ATI in the event that Nurescell AG achieves certain gross
revenue numbers over a period of five years. Adrian Joseph is the Chief
Executive Officer of Nurescell, Inc.
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The shares of Nurescell, Inc. to be received by ATI constitute
approximately 22.9% of the outstanding shares of Nurescell, Inc.
The shares to be received by the Josephs are restricted shares. In
addition, the Agreement prohibits the Josephs from selling or otherwise
transferring in excess of 600,000 shares per year. However, the Agreement
provides for the execution of a Registration Rights Agreement giving the Josephs
the right to have up to 600,000 shares per year registered over a five year
period. The parties have agreed to extend this period to six years. The Josephs
have the right to demand registration of their shares each year at their
expense, or, if ATI is filing a registration statement to register other shares
during that time, to require that their shares be registered at the expense of
ATI. In lieu of registering the shares ATI has the right to purchase the shares
at 80% of the average bid price at determined times.
The Agreement also provides for the execution of a Voting Trust
Agreement by the Josephs which would give ATI the right to vote any of the
shares received by the Josephs under the Agreement for a period of five years.
When the Agreement was executed a letter agreement was executed by the parties
that waived the requirement of a voting trust agreement on the condition that
the Josephs would grant an irrevocable proxy to Mr. Kurt Seifman. Mr Seifman
presently owns 4,184,940 shares of the outstanding $.0001 par value common stock
of ATI which constitutes approximately 27.4% of the outstanding shares of ATI.
However, the parties are presently renegotiating this aspect of the transaction
and although they agree that there will be voting rights granted by the Josephs
to ATI or some other party for a period of five years from the date of the
Agreement, this agreement may take the form of a voting trust agreement, an
irrevocable proxy, or some other form of agreement.
In addition, the parties are in the process of revising both the
Agreement and the Registration Rights Agreement included therein although it is
not anticipated that these documents will change materially. The Parties have
not yet agreed upon a closing date for the transaction.
This transaction was negotiated between ATI and Mr. Joseph
independently of the negotiations between ATI and Nurescell, Inc. concerning the
formation of Nurescell AG. Those negotiations were conducted by Mr. William A.
Wilson the Chairman of the Board and then President of Nurescell, Inc. However,
the management of ATI believed that it would be beneficial and in ATI's best
interest to acquire a significant stock position in Nurescell, Inc. in view of
the entering into of the agreements between Nurescell, Inc. and ATI concerning
the formation of Nurescell AG and the granting of the License to Nurescell AG by
Nurescell, Inc. In determining the amount of ATI shares to be exchanged for the
Nurescell, Inc. shares the management of ATI took into consideration, among
other things, the relative market prices of the respective stocks, the
restriction on voting rights of the ATI shares, the restrictions on the ability
of Joseph to sell the ATI shares, the percentage that said shares constituted of
the outstanding stock of Nurescell, Inc., the benefits of acquiring an ownership
position in Nurescell, Inc. in view of the formation of Nurescell AG, and the
future business prospects of Nurescell, Inc.
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For information concerning the business and financial condition of
Nurescell, Inc. reference is made to the Form 10-KSB filed by Nurescell Inc.
with the Securities and Exchange Commission on July 12, 2000 for the fiscal year
ended March 31, 2000.
For a complete description of the terms of the transactions described
above, reference is made to the Agreement For Purchase Of Stock including the
Registration Rights Agreement attached as Exhibit A thereto which is attached as
an exhibit to this Current Report on Form 8-K. The Voting Trust Agreement
referred to therein is attached as Exhibit B to the Agreement For Purchase Of
Stock. However, as stated above this requirement was modified to provide for an
irrevocable proxy to be executed by the Josephs in place thereof which is the
subject of continuing negotiations. The letter agreement executed by the parties
substituting the irrevocable proxy for the Voting Trust Agreement is included as
part of the exhibit.
Forward- Looking Statements
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This Current Report may contain certain statements that are
"Forward-Looking Statements" 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. The Company notes that statements in this Current Report which look
forward in time, which includes everything other than historical information or
a summary of agreements actually entered into, involve risks and uncertainties
that may affect the Company's actual results of operation. Although ATI believes
that the expectations reflected in Forward-Looking Statements are reasonable,
management can give no assurance that such expectations will prove to have been
correct.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
(c) Exhibits.
10.11. Investment Agreement between Nurescell, Inc. and
Nurescell AG.
10.12. License Agreement between Nurescell, Inc. and
Nurescell AG.
10.13. Agreement For Purchase Of Stock of Nurescell, Inc. by
Company.
99.1 Press Release dated August 25, 2000.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: September 6, 2000 ADVANCED TECHNOLOGY INDUSTRIES, INC.
By: /S/ Hans Joachim Skrobanek
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Hans Joachim Skrobanek, President and Chief
Executive Officer
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