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 - July 9, 2001
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(Date of earliest event reported)
QUAD SYSTEMS CORPORATION
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(Exact name of Registrant as specified in its charter)
Delaware 0-21504 23-2180139
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(State of incorporation) (Commission (IRS Employer
File Number) Identification No.)
2405 Maryland Road, Willow Grove, Pennsylvania 19090
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (215) 657-6202
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Item 5. Other Events
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On July 9, 2001, Quad Systems Corporation ("Quad") completed the sale of
its business and substantially all of its U.S. assets other than accounts
receivable, including the Quad name, to Tyco Electronics Corporation, a
Pennsylvania corporation and a subsidiary of Tyco International Ltd., ("Tyco")
on the terms described below. In connection with the sale, Quad will now be
known as Epigenesis, Inc., until the completion of its expected liquidation. On
July 11, 2001, Quad also completed the sale of the business and assets of Quad's
U.K. subsidiary to an affiliate of Tyco.
Until the sale, Quad had been operating its business as a debtor and a
debtor-in-possession in Chapter 11 bankruptcy proceedings pending before the
United States Bankruptcy Court for the Eastern District of Pennsylvania (the
"Bankruptcy Court"). Quad entered into the Agreement of Sale and consummated the
transaction with Tyco with the prior approval of the Bankruptcy Court. Following
the closing, Tyco will continue to operate the assets that formerly comprised
Quad's business.
The total purchase price for the sale of the U.S. assets was approximately
$5.2 million, subject to post-closing adjustment in certain circumstances based
on the post-closing value of the assets transferred, plus the assumption of
certain liabilities. The purchase price was paid in cash at closing, net of a
hold-back of $1,250,000 to secure any such post-closing adjustment and certain
continuing warranty obligations of Quad in connection with the sale of Quad's
assets and its U.K. subsidiary. The Quad U.K. subsidiary was sold for
approximately (U.S.) $550,000, plus the assumption of certain liabilities. After
payment of secured indebtedness aggregating approximately $1,140,000, Quad
currently expects that net proceeds from the U.S. sale of approximately $2.8
million will be available to pay priority and general unsecured claimants in
Quad's bankruptcy proceedings under a plan of reorganization/liquidation that
Quad expects to file with and have approved by the Bankruptcy Court. The
proceeds of Quad's retained accounts receivable, and any portion of the
$1,250,000 holdback ultimately paid over to Quad will also be available to pay
claimants in the bankruptcy proceedings. It is not anticipated that any
distribution will be made to any of Quad's equity securityholders, in connection
with its bankruptcy proceedings or otherwise. Quad expects that Tyco will retain
some portion of the $1,250,000 holdback upon completion of the post-closing
adjustment.
Item 7. Financial Statements and Exhibits.
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(c) Exhibits
99 Press Release, dated July 12, 2001
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 thereunto duly authorized.
QUAD SYSTEMS CORPORATION
Dated: July 12, 2001 By /s/ Anthony R. Drury
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Anthony R. Drury
Senior Vice President, Finance
and Chief Financial Officer
(Principal Accounting Officer
and duly authorized officer)
QUAD SYSTEMS CORPORATION
CURRENT REPORT ON FORM 8-K
EXHIBIT INDEX
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Exhibit
No. Exhibit
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99 Press Release, dated July 12, 2001