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 (Date of earliest event reported): November 30, 2005
ZOLTEK COMPANIES, INC.
(Exact name of registrant as specified in its charter)
MISSOURI 0-20600 43-1311101
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
organization) Number)
3101 MCKELVEY ROAD
ST. LOUIS, MISSOURI 63044
(Address of principal executive offices) (Zip Code)
(314) 291-5110
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name or former address if changed since last report)
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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:
[ ] 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))
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ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On December 1, 2005, Zoltek Companies, Inc. (the
"Registrant") announced that it had completed the private placement of $15
million aggregate principal amount of 7.5% Senior Convertible Notes (the
"Notes") pursuant to the terms of its previously announced Loan and Warrant
Agreement, dated as of September 29, 2005 (the "Loan Agreement"), among the
Registrant, the lenders parties thereto ("Lenders"). As previously reported
by the Registrant in its Current Report dated September 29, 2005, under the
Loan Agreement the Registrant may issue up to $50 million principal amount
of senior convertible notes in up to four tranches, with the first tranche
being for $5 million principal amount of Notes, the second tranche for up to
$15 million principal amount of Notes, the third tranche for up to $20
million principal amount of Notes, and the fourth tranche for up to $10
million principal amount of Notes. The closing of the funding of the first
tranche was completed on September 30, 2005 and the closing of the second
tranche was completed on November 30, 2005. A copy of the Loan Agreement is
incorporated by reference in this report as Exhibit 4.1.
The Notes, the form of which is incorporated by reference
in this report as Exhibit 4.2, are convertible into shares of Common Stock.
The initial conversion price of the Notes is $12.50 (subject to adjustment).
The Notes bear interest at the rate of 7.5% per annum, payable quarterly,
and are due and payable upon the expiration of their 42-month term. The
interest on the Notes may be paid in cash or, at the Registrant's option, in
Common Stock if certain conditions are satisfied as set forth in the Notes.
If the Company chooses to pay the interest in Common Stock, the price will
be based on 90% of the average of the daily volume weighted average price
for the 20 days prior to the interest payment date. The Notes will be
secured by a pledge of certain real property and fixed assets associated
with the operations of Zoltek Rt., the Registrant's Hungarian subsidiary.
Pursuant to the Loan Agreement, the Company agreed to
issue to the Lenders warrants to purchase 420,000 additional shares of
Common Stock, representing 35% of the number of shares into which the Notes
are convertible (the "Warrants"). The Warrants, the form of which are
incorporated by reference in this report as Exhibit 4.3, have five-year
terms. The exercise price of the Warrants issued in the second tranche is
$14.50 (subject to adjustment).
The conversion prices of the Notes and the exercise prices
of the Warrants are both subject to adjustment under certain circumstances,
as set forth in the Notes and the Warrants. The number of shares of Common
Stock issuable under the Notes and the Warrants are subject to the
occurrences of certain events described therein such as the declaration by
the Registrant of a stock dividend, a subdivision or combination of its
outstanding shares of Common Stock, a reclassification of the outstanding
securities of the Registrant (including due to reorganization of the
Registrant itself) or the issuance of common equity securities at a price
less than the applicable conversion or exercise price.
All of the Lenders are "accredited investors," as defined
in Rule 501 of Regulation D under the Securities Act of 1933, as amended
(the "Securities Act"), and the securities offered and sold in the private
placement have not been registered under the Securities Act and were sold
without registration in reliance upon the exemption from securities
registration under both Rule 506 of Regulation D and Section 4(2) of the
Securities Act. The Registrant has entered into a Registration Rights
Agreement with the Lenders, a copy of which is incorporated by reference in
this report as Exhibit 4.4 ("Registration Rights Agreement"), pursuant to
which the Lenders shall have the right to demand registration of the Common
Stock and to participate in certain subsequent offerings of securities by
the Registrant or other shareholders.
The foregoing summary is qualified in its entirety by the
Loan Agreement, Notes, Warrants, and the Registration Rights Agreement, and
should be read in conjunction with, the copies of such documents
incorporated by reference in this report as exhibits.
On December 1, 2005, the Registrant issued a press release
announcing that it had completed the funding of the second tranche under the
Loan Agreement in the amount of $15.0 million. The text of this press
release is attached hereto as Exhibit 99.1.
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ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION
UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
See Item 1.01 which is incorporated herein by reference.
ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES.
See Item 1.01 which is incorporated herein by reference.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial statements of businesses acquired. Not
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applicable.
(b) Pro forma financial information. Not applicable.
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(c) Exhibits. See Exhibit Index.
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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 thereunto duly authorized.
Dated: December 2, 2005
ZOLTEK COMPANIES, INC.
By /s/ Kevin Schott
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Kevin Schott
Chief Financial Officer
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EXHIBIT INDEX
Exhibit
Number Description
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4.1 Loan and Warrant Agreement, as of September 29, 2005, among the
Registrant, the Lenders and the Agent, filed as Exhibit 4.1 to the
Registrant's Current Report on Form 8-K dated September 29, 2005 and
incorporated herein by reference.
4.2 Form of Note, filed as Exhibit 4.2 to the Registrant's Current Report
on Form 8-K dated September 29, 2005 and incorporated herein by
reference.
4.3 Form of Warrant, filed as Exhibit 4.3 to the Registrant's Current
Report on Form 8-K dated September 29, 2005 and incorporated herein by
reference.
4.4 Registration Rights Agreement, dated as of September 30, 2005, by and
among the Registrant and the Lenders parties thereto, filed as Exhibit
4.4 to the Registrant's Current Report on Form 8-K dated September 29,
2005 and incorporated herein by reference.
99.1 Press Release, dated December 1, 2005.
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