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: August 23, 2002
(Date of earliest event reported: August 20, 2002)
DynTek, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 1-11568 95-4228470
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
18881 Von Karman Avenue, Suite 250, Irvine, CA 92612
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (949) 798-7200
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ITEM 5. OTHER EVENTS
On August 20, 2002, DynTek, Inc. ("DynTek") entered into a Stock Purchase and
Settlement Agreement with DynCorp (the "Settlement Agreement"), its principal
stockholder, pursuant to which each of DynTek and DynCorp agreed to settle all
disputes between them, including those resulting from DynTek's acquisition by
merger of DynCorp's former wholly-owned subisdiary, DynCorp Management
Resources, Inc., in December 2001 (the"Merger"). As part of the Settlement
Agreement, DynCorp agreed to sell to DynTek 8,000,000 shares of DynTek Class B
common stock at a price of $.625 per share, convert its remaining 10,336,663
shares of Class B common stock (constituting the balance of all outstanding
Class B common stock) to DynTek Class A common stock, advance to DynTek a total
of $5,000,000 to defray losses incurred by DynTek from its operations under the
terms of a contract with the Commonwealth of Virginia acquired by DynTek in
connection with the Merger, and provide a general release to DynTek and its
affiliates from any and all claims that it might have against such persons.
DynCorp also agreed to refrain from purchasing any additional DynTek securities,
except as permitted under the terms of the Settlement Agreement, for a period of
two years. Under the Settlement Agreement, DynTek agreed to pay for the Class B
common stock shares acquired from DynCorp with a $5,000,000 principal unsecured,
subordinated note maturing on January 2, 2007, bearing interest at 15%. DynTek
also agreed to cancel a non-compete agreement between DynCorp and DynTek that
had been negotiated as part of the Merger, institute certain changes in the way
that DynTek manages its performance under its contract with the Commonwealth of
Virginia, implement a restructuring of its executive compensation program, issue
to DynCorp warrants to acquire 7,500,000 shares of Class A common stock
exercisable for three years at $4.00 per share (the "Warrants"), grant demand
registration rights with respect to the Warrants and DynCorp's Class A common
stock shares (including those to be acquired upon Warrant exercise), and provide
a general release to DynCorp and its affiliates from any and all claims that it
might have against such persons.
Each party also agreed to refrain from commencing any litigation against the
other, except to enforce the Settlement Agreement and the ancillary agreements.
Effective August 20, 2002, the three Class B directors on DynTek's Board of
Directors, who had been designated by DynCorp, resigned from DynTek's Board of
Directors.
Item 7. Financial Statements, Pro Forma Financial sand Exhibits.
(c) Exhibits.
10.1 Stock Purchase and Settlement Agreement , dated 20, between
DynCorp and DynTek, Inc.
10.2 Promissory Note made by DynTek, Inc. in favor or DynCorp,
for $5,000,000 principal, dated August 20, 2002
10.3 Warrant, dated August 20, 2002, made in favor of DynCorp
for 7,500,000 shares of Class A Common Stock.
10.4 General Release, dated August 20, 2002, of DynTek, Inc. by
DynCorp.
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10.5 General Release, dated August 20, 2002, of DynCorp by
DynTek, Inc.
10.6 Amendment No. 14 and Waiver to Loan and Security Agreement,
dated August 20, 2002, by and among DynTek Services, Inc., DynTek, Inc. and
Foothill Capital Corporation.
99.1 Press Release announcing Stock Purchase and Settlement
Agreement closing, dated August 21, 2002.
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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.
Dated: August 20, 2002 DYNTEK, INC.
By /S/ JAMES LINESCH
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James Linesch, Chief Financial Officer