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): February 4, 2005
Science Dynamics Corporation
(Exact name of registrant as specified in its charter)
Delaware 000-10690 22-2011859
- --------------------------------------------------------------------------------
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
7150 N. Park Drive, Suite 500
Pennsauken, NJ 08109
(Address of principal executive offices and Zip Code)
Registrant's telephone number, including area code: (856) 910-1166
Copies to:
Gregory Sichenzia, Esq.
Sichenzia Ross Friedman Ference LLP
1065 Avenue of the Americas
New York, New York 10018
Phone: (212) 930-9700
Fax: (212) 930-9725
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
On February 4, 2005, the Company entered into an Employment Agreement
with SMEI and Eric D. Zelsdorf. Under the agreement, Mr. Zelsdorf will be
employed as SMEI's Chief Technology Officer until December 31, 2007. For his
services, SMEI agreed to pay Mr. Zelsdorf a base salary of $160,000 per year.
Mr. Zelsdorf also may be paid an incentive bonus based on a percentage of his
base salary. Upon completion of the Company's acquisition of SMEI, the Company
agreed that it would grant Mr. Zelsdorf stock options in accordance with the
Company's employee stock option program. The exercise price of the stock options
are to be set at the Company's stock price at the close of the acquisition of
SMEI by the Company. The agreement will terminate upon the following events and
conditions: (a) upon expiration of its terms; (b) for cause by SMEI immediately
upon written notice; (c) For cause by Mr. Zelsdorf immediately upon written
notice; (d) without cause by either party upon written notice; or (e) in the
event Mr. Zelsdorf is unable to perform services required under the agreement by
reason of incapacity or disablement for more than six months. Cause by SMEI is
defined in the agreement as: a material breach by Mr. Zelsdorf, a felony
conviction or any willful act or omission of dishonesty which causes harm to
SMEI. Resignation of Mr. Zelsdorf with cause is defined to include, but not
limited to: a reduction in position and/or responsibilities, a material change
in Mr. Zelsdorf's reporting structure, or relocation beyond 30 miles of SMEI's
principal office. If the agreement is terminated by SMEI without cause or if Mr.
Zelsdorf resigns with cause, Mr. Zelsdorf will be entitled to all compensation
and benefits otherwise remaining unpaid under the remaining term of the
agreement and all stock options which have been granted under the agreement will
become immediately vested and exercisable. In the event Mr. Zelsdorf is
terminated for cause or resigns voluntarily, no compensation will be due to him
other than what was earned through the date of termination.
On February 4, 2005, the Company entered into a Consulting Agreement
with SMEI and Herbert B. Quinn, Jr., which is effective as of the date the
Company completes the acquisition of SMEI. Under the agreement, Mr. Quinn will
perform strategic analytical and advisory services as reasonably requested by
SMEI's Chief Executive Officer. For his services, the Company agreed to pay Mr.
Quinn $150,000 per year. Mr. Quinn also is eligible to receive options under the
Company's stock option plan or any similar plan that is in effect. The term of
the agreement is for one year and will automatically renew for one additional
year unless either party gives at least 30 days prior written notice of their
intent not to extend the agreement. The agreement does not contain any
termination provisions.
Item 9.01 Financial Statements and Exhibits.
(a) Financial statements of business acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits.
Exhibit Number Description
- --------------------------------------------------------------------------------
10.1 Employment Agreement dated January 1, 2005 between Science
Dynamics Corporation, Systems Management Engineering, Inc. and
Eric D. Zelsdorf
10.2 Consulting Agreement dated January 1, 2005 between Science
Dynamics Corporation, Systems Management Engineering, Inc. and
Herbert B. Quinn, Jr.
2
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.
Science Dynamics Corporation
Date: February 25, 2005 /s/ Alan C. Bashforth
---------------------
Alan C. Bashforth
Acting Chief Financial Officer and Secretary