SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported) October 6, 1995
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MANAGEMENT TECHNOLOGIES, INC.
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Exact name of Registrant as specified in its Charter)
NEW YORK
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(State or other jurisdiction of incorporation)
0-17206 13-3029797
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Commission File No. I.R.S. Employer Identification
630 Third Avenue, New York, NY 10017
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Address of principal Zip Code
executive offices
(212) 983-5620
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Registrant's telephone number,
including area code
ITEM 6. RESIGNATIONS OF REGISTRANT'S DIRECTORS
On September 11, 1995, Mr. Dan Sladden, a Director of the Registrant
("the Company") advised the Chairman of the Board of the Company that he
elected to resign from the Company. Thereafter, the Company accepted Mr.
Sladden's resignation. Mr. Sladden did not have any disagreement with the
Company on any matter relating to its operations, policies, or practices.
Annexed hereto and marked Exhibit 17.03 is a copy of Mr. Sladden's resignation.
The Company, on September 27, 1995, accepted the resignation of Keith
Williams, Chief Operating Officer, President, and a Director of the Company.
Mr. Williams informed the Board that he was in disagreement with the Board's
2
policies and practices concerning the management of the Company. The Board
accepted Mr. Williams' resignation, and it is the Board of Directors' position
that Mr. Williams, as President and Chief Operating Officer of the Company, was
in charge of all business operations of the Company, and that the Board was
dissatisfied with Mr. Williams' job performance as President and Chief Operating
Officer of the Company. Mr. Williams claimed that the Board has not acted in
the best interests of shareholders and submitted to the Board a copy of an
unsigned draft memorandum by Mr. Guazzoni, a Director of the Company, as part of
the reason for his resignation. Mr. Guazzoni has informed the Board that his
draft memorandum dated July 26, 1995 was circulated for comments only; it was
never signed nor issued. Additionally, Mr. Williams disagreed with the Board's
proposed appointment of Mr. Peter Morris as a Director of the Company and as
Managing Director for Trading Systems, Ltd., a subsidiary of the Company. He
claimed that the appointment of Mr. Morris was not in the best interests of
shareholders; however, this has been rejected by the Board. Mr. Morris has been
Manager of the Trading Systems Division of the Company for the past five years,
and in the Board's view is qualified for the position of Managing Director of
Trading Systems, and is further qualified to serve on the Board if he accepts
the appointment.
As Mr. Williams voluntarily resigned, it is the Company's position
that he is not entitled to a bonus and/or other payments under his agreement
with the Company other than accrued vacation and verified expenses to which he
may be entitled, upon Mr. Williams' verification of those items. The Company
anticipates that it may be in litigation with Mr. Williams with respect to his
Employment Agreement. Annexed hereto and made a part hereof, and marked Exhibit
17.04, is a copy of Mr. Williams' letter of resignation and attachment.
On September 27, 1995, the Company received and accepted the
resignation of Nigel Cole as Chief Financial Officer. Annexed hereto and made a
3
part hereof and marked Exhibit 99.01 is a copy of Mr. Cole's resignation. Mr.
Cole worked directly with Mr. Williams and his statement that the Company's
subsidiaries are trading in England without reasonable certainty that there are
funds required to meet the payments of creditors was not accepted by the Board,
in that the Company is in the process of raising working capital for the
Company. It is the Board's view that Mr. Cole resigned as a result of his
association and long-standing relationship with Mr. Williams. Mr. Cole has
advised the Company that he would remain for a period of three months or until
the Company finds a replacement for his position.
The Company appointed Mr. Peter Svennilson, its Chairman, as temporary
Chief Executive Officer for a short time period following Mr. William's
resignation, and on October 2, 1995, appointed Mr. Paul Ekon as a Director and
Chief Executive Officer of the Company. Mr. Ekon is a businessman and has been
engaged in the manufacturing and marketing business, and as a principal of other
business operations in South Africa since 1990. He represents a number of
shareholders of the Company. Mr. Svennilson will continue as Chairman of the
Board of the Company.
ITEM 7: EXHIBITS
17.03. Resignation letter of Dan Sladden.
17.04. Resignation letter of Keith Williams.
99.01. Resignation letter of Nigel Cole.
SIGNATURES
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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.
Dated: New York, New York
October 6, 1995
MANAGEMENT TECHNOLOGIES, INC.
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(Registrant)
/s/ Paul Ekon
PAUL EKON
Chief Executive Officer
12 Old Bond Street
London W1X 3DB
Peter Svennilson, Esq.
Chairman of the Board
Management Technologies, Inc.
c/o Irongate
12 Old Bond Street
London W1X 3DB
11 September 1995
Dear Peter:
Re: Management Technologies, Inc.
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I hereby resign formally as a non-executive Director of
Management Technologies, Inc. for personal reasons.
I have enjoyed serving as a non-executive Director of MTi and
wish you, the Board and the Company ever success in the future.
Yours sincerely,
/s/ Daniel Sladden Received
Daniel Sladden /s/ Peter Svennilson
11 Sept -95
18 Broomfield Ride
Oxshott
Surrey
KT22 0LW
PRIVATE AND CONFIDENTIAL
The Board of Directors 3rd October 1995
October 1995
Management Technologies Inc.
335 Madison Avenue
New York
NY 10017 BY FAX
Gentlemen
I am writing to confirm my resignation from the Board of
Management Technologies Incorporated (``MTi') as its President
with effect from Tuesday 25th September 1995. I also give
notice of my resignation from office and subsidiaries of MTI.
Please confirm that these resignations are accepted and that
appropriate notifications have been made. I confirm that I was
forced to resign by reason of the conduct of the Board of
Directors and actions of the Board incompatible with my
membership of it and its fiduciary duties to shareholders. I do
not consider that the Board has acted collectively in accordance
with its fiduciary responsibilities to shareholders and others.
By was of example, I would remind you of the memorandum from
Claudio Guazzoni to the Board on 26th July 1995, a copy of which
is enclosed. Mr. Guazzoni had apparently obtained emergency
funding in the sum of US$300,000.00 for MTI from one source and
meetings had been arranged with three other separate funding
sources. Mr. Guazzoni complains that Mr. Svennilson, Mr. Sladden
and other directors were unavailable for that Board meeting which
put the proposed investment in jeopardy. Mr. Guazzoni alleged
that Mr. Svennilson, Mr. Sladden and other directors had
purposely not acted in the best interests of shareholders by
violating their fiduciary obligations to shareholders. The Board
has taken no action as a result of this memorandum from Mr.
Guazzoni notwithstanding a number of requests by me. The funding
which Mr. Svennilson has undertaken to provide has not
materialised. Given the present financial circumstances of the
Company, I find it inexplicable that no action has been taken.
A second example relates to the proposed appointment of Mr.
Morris as a director of MTI. Mr. Morris has sought to mount a
management but-out of MTI Trading Systems Limited, the company of
which he is Managing Director, at a price which does not
represent the value of that business. The management buy-out
offer was unsolicited and, in my judgment, the appointment of Mr.
Morris to the Board would give rise to a clear conflict of
interest on his part. I find it impossible to believe that such
appointment was and was believed to be in the interest of
shareholders.
I expect outstanding sums due to me under my contract to be met.
These are as follows:
1. a bonus outstanding amounting to 21,000 British pounds in
respect of Winter Partners' performance for the period
ending 30th September 1995;
2. a payment of US$100,000 admitted to be true and acknowledged
to be so in Form 10k file with the SEC;
3. payment in respect of the outstanding 43 days' holiday;
4. payment in respect of the outstanding period of my contract
from 26th September 1995 until 31st May 1997 at the rate
of 155,000 British pounds per annum, i.e. 258,333 British
pounds;
5. Car allowance at the rate of 1200 British pounds per month
for the period until 31st May 1997, i.e. 24,000
British pounds.
Kindly confirm that these payments will be made to me within 14
days of the date of this letter, failing which I shall take
whatever action is appropriate to recover the same.
Yours faithfully
/s/ Keith Williams
KEITH WILLIAMS
Zanett Capital Inc. 1339 COOPER STATION, N EW
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YORK, NY 10279
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TELEPHONE: 212-343-
2000
FACSIMILE: 212-
343-2121
CLAUDIO GUAZZONI
PRESIDENT
TO: BOARD OF DIRECTORS OF MTI
AS A MATTER OF RECORD
OF 25 JULY 1995
1. As a Director, I requested an emergency meeting for
Wednesday, July 28, 1995 at 8:00 a.m. based upon obtaining
approval for the terms of emergency funding in the sum of
$300,000 for the Company from one source.
2. Furthermore, on the agenda there was to be discussion of
meetings to be held with three separate funding sources,
each of whom can supply the full $3 million we so
desperately need. We have been presented with a Consulting
Agreement from Mr. Belwal, a gatekeeper to a number of
funding sources. We, as a Board, need to approve Mr.
Belwal's non-exclusive Consulting Agreement in order to
proceed with the meetings. If we do not like the terms of
the funding obtained by Mr. Belwal, we need not accept his
money. He gets paid only if and only when we accept his
funding.
3. Mr. Williams authorised the signing of the Notice of today's
meting and was aware of the time and urgency of the meeting.
4. Mr. Cataldo and myself, as Directors, separately contacted
Mr. Svennilson and advised him of the meeting with ample
time. Mr. Svennilson said he was raising funding himself,
and that he absolutely did not approve of management's
signing the contract with Mr. Belwal, thereby excluding
other sources of funding besides himself.
5. Both myself, Mr. Cataldo, and corporate counsel were
available for the meeting which was not held as a result of
not having a quorum and the apparent unavailability of Mr.
Svennilson, Mr. Sladden, and other Directors.
6. As there are material matters of great urgency facing the
Company and a result of the delay in having the meeting, the
$300,000 Investment is already in Jeopardy. It is my
position Mr. Svennilson, Mr. Sladden, and other Directors
have purposefully not acted in the best interests of all
shareholders, violating their fiduciary obligation to
shareholders.
7. In the event the funding is not raised on favorable terms, I
intend to hold Mr. Svennilson, Mr. Sladden and other
Directors personally responsible for any loss to
shareholders of the Company.
8. I had meetings scheduled with two fund managers on Tuesday,
July 25th. Because Mr. Svennilson refused to approve the
signature of the Consulting Agreement, Mr. Belwal postponed
the meetings until today. Upon further stubbornness and
greed from Mr. Svennilson to hoard the financing all to
himself, even today's meetings were canceled.
9. I await your immediate response, at the meeting scheduled
for tomorrow should be productive meeting in the interest
of shareholders and the Company, and not a disruptive non-
productive meeting which will further damage shareholders.
10. Mr. Svennilson has done this Company and its shareholders a
great disservice in trying to hoard the financing and the
associated fees and discounts all to himself.
11. Mr. Svennilson, as Chairman, has not acted in the best
interest of all shareholders and I demand, as a Director, a
full accounting from him.
115 Mount Grace Road
Potters Bar
Herts EN6 1QY
The Board of Directors
Management Technologies, Inc.
630 Third Avenue
New York
NY 10017
United States of America
By fax and by mail.
for the attention of Mr. Peter Svennilson
Chairman
Gentlemen,
It is my best belief that, the latest planned investment by the
Richbell Group having become materially less likely to take
place, the MTi subsidiaries in the UK are trading without
reasonable certainty that there will be funds available to meet
their obligations as they fall due. I understand that the Board
was so advised last night by Keith Williams and Stefan Weber. My
understanding is that these circumstances constitute wrongful
trading under UK law.
I am convinced that the Group cannot survive without immediate
substantial injections of working capital and I have no
confidence that such sums will be forthcoming. Despite the terms
of Mr. Svennilson's recent letter to me, I have received no
information from the Board as to the progress of funding
initiatives.
I have to assume that the Board does not wish me to have such
information and under those circumstances, my position as Chief
Financial Officer and as manager of the Company becomes
untenable.
This letter is therefore my immediate formal resignation from all
positions I hold with Management Technologies, Inc. and all its
subsidiaries. Under the terms of my contract with the Company I
have to give three months notice of termination of my contract.
This letter constitutes such notice.
Yours faithfully,
/s/ Nigel Cole
