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): July 9, 2003
MARKLAND TECHNOLOGIES, INC.
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(Exact Name of Registrant as Specified in its Charter)
Florida
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(State or Other Jurisdiction of Incorporation)
000-28863 84-1331134
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(Commission File Number) (IRS Employer Identification No.)
#207, 54 Danbury Road, Ridgefield, CT 06877
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(Address of Principal Executive Offices) (Zip Code)
(203) 894-9700
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former Name or Former Address, If Changed Since Last Report)
Item 1. Changes in Control of Registrant
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Syqwest, Inc., a Rhode Island corporation, formerly known as Ocean Data
Equipment Corporation ("Syqwest"), entered into an Exchange Agreement with the
Registrant dated July 9, 2003 pursuant to which it agreed to receive 45,000,000
shares, valued at $.01 per share, of the Registrant's common stock as the form
of payment for $450,000 which Registrant owed to Syqwest in connection with
services Syqwest rendered, as described below, to Registrant, which agreement
was amended and restated in an Amended and Restated Exchange Agreement dated
July 24, 2003 (the "Amended Exchange Agreement"). Pursuant to the Amended
Exchange Agreement, the Registrant has the option to repurchase from Syqwest
said 45,000,000 shares for $.01 per share. A copy of the Amended Exchange
Agreement is filed as Exhibit 10.1 to this Current Report on Form 8-K.
Management of the Registrant believes issuance of such shares resulted in a
change of control such that Eurotech Ltd., the former majority holder of the
Registrant's common stock, has become a minority holder.
The services rendered by Syqwest enabled the Registrant to conduct its
border security technology business that it entered in response to the U.S.
government's initiatives to increase homeland security.
The Registrant, upon purchase of government solutions provider ERGO
Systems Inc. of Falls Church, Virginia, did not directly employ the human
resources necessary to conduct border security activities. As a result, the
decision was made by the directors of the Registrant that those necessary human
resources, i.e., engineering, field technician, purchasing and program
management, would be, in the short term and for the purposes of minimizing
corporate fixed cost structures, conducted via exclusive subcontracted services.
Syqwest personnel have conducted field service and maintenance as well as
engineering design and procurement activities for ERGO Systems for the past
eight months for an aggregate cost of approximately $795,000. These services
include the successful design and test of the Vehicle Stopping System, which has
been covered in numerous national media events. Given that Registrant is
conserving its cash for planned future acquisitions it requested that Syqwest
take restricted shares in lieu of cash to offset $450,000 in service fees
payable. Robert Tarini, a director of the Registrant, is a minority shareholder,
Chief Executive Officer, and director of Syqwest.
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth certain information with respect to the
capital stock beneficially owned by the Registrant's directors, executive
officers and each person known to the Registrant who owns in excess of 5% of the
outstanding shares of capital stock and the directors and executive officers of
the Registrant as a group. The table assumes a total of 292,590,859 shares of
the Registrant's common stock outstanding as of the date hereof.
Each person listed below has personal and sole beneficial ownership of
the shares of common stock listed with their name. The address of each of the
persons named in the table below, unless otherwise indicated, is c/o Markland
Technologies, Inc., #207 - 54 Danbury Road, Ridgefield, Connecticut 06877.
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SHARES OF PERCENT OF
TITLE OF CLASS NAME AND ADDRESS CAPITAL STOCK (1) CLASS
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Common Eurotech, Ltd 139,927,344 47.82%
10306 Eaton Place, Suite 220
Fairfax, VA 22030
Common SyQwest 45,000,000 15.38% (2)
88 Royal Little Drive
Providence, RI 02904
ipPartners 29,990,917 10.25% (2)
P.O. Box 1490
Coventry, RI 02816
James, LLC 27,706,611 9.47%
PO Box 866
George Town Anderson Square Building
Shedden Road
Cayman Islands
ASI 17,000,000 5.81%
ASI Technology Corporation
980 American Pacific Drive, #111
Henderson, Nevada 89014
Del Kintner 2,712,801 0.93%
Ken Ducey, Jr. 2,712,801 0.93%
Robert Tarini 2,712,801 0.93% (2)
All Directors and Executive Officers
as a Group (3 persons)
Series C James, LLC 1,583 29.34% (3)
Cumulative PO Box 866
Convertible George Town Anderson Square Building
Preferred Shedden Road
Cayman Islands
Market, LLC 3,812 70.66% (3)
PO Box 866
George Town Anderson Square Building
Shedden Road
Cayman Islands
Series D Woodward LLC 16,000 96.56% (4)
Cumulative Cayman Islands
Convertible
Preferred
James, LLC 570 3.44% (4)
PO Box 866
George Town Anderson Square Building
Shedden Road
Cayman Islands
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(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission (the "SEC"). In computing the number of
shares owned by a person and the percentage ownership of that person, shares of
common stock subject to options and warrants held by that person that are
currently exercisable or exercisable within 60 days of the date hereof, are
deemed outstanding. Such shares, however, are not deemed outstanding for the
purposes of computing the percentage ownership of any other person. This table
has been prepared based on 292,590,859 shares of Common Stock, 5,395 shares of
Series C Preferred Stock and 16,570 shares of Series D Preferred Stock
outstanding as of the date hereof.
(2) Robert Tarini, Chairman of the Board of Directors of the Registrant is a
director and majority stock holder of ipPartners and a director and minority
stockholder of Syqwest.
(3) The Series C Cumulative Convertible Preferred Stock (the "Series C
Preferred") is convertible into Common Stock at the option of the holder at the
rate of 10% per month from June 9, 2003, at a conversion price ranging from 65%
to 80% of the Common Stock's market price at the time of conversion. Assuming an
average market price of $0.30 and a conversion rate equal to 80% of the market
price and taking into account accrued interest, the Series C Preferred would
convert into an aggregate of 22,817,000 shares of Common Stock. Pursuant to the
Registrant's Articles of Incorporation, as amended to date, however, the number
of shares of Common Stock that may be acquired upon conversion of the Series C
Preferred by any holder thereof shall be limited to the extent necessary to
ensure that such holder, along with its affiliates, does not beneficially own
more than 9.999% of the total number of issued and outstanding shares of Common
Stock following the conversion.
(4) This Series D Cumulative Convertible Preferred Stock (the "Series D
Preferred") is convertible into Common Stock of Common Stock at the option of
the holder at the at a conversion price ranging from 65% to 80% of the Common
Stock's market price at the time of conversion. Assuming an average market price
of $0.05 and a conversion rate equal to 80% of the market price, the Series D
Preferred would convert into an aggregate of 414,250,000 shares of Common Stock.
Pursuant to the Registrant's Articles of Incorporation, as amended to date,
however, the number of shares of Common Stock that may be acquired upon
conversion of the Series D Preferred by any holder thereof shall be limited to
the extent necessary to ensure that such holder, along with its affiliates, does
not beneficially own more than 9.999% of the total number of issued and
outstanding shares of Common Stock following the conversion.
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SIGNATURE
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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 thereunto duly authorized.
MARKLAND TECHNOLOGIES, INC.
(Registrant)
By: /s/ Kenneth Ducey
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Kenneth Ducey, President
Date: July 29, 2003
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Exhibit 10.1 Amended and Restated Exchange Agreement dated July 24, 2003
between Markland Technologies, Inc. and Syqwest, Inc.
Exhibit 99.1 Press Release dated July 10, 2003 issued in response to press
release of Eurotech Ltd. dated July 8, 2003.