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): May 15, 2006
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))
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On May 15, 2006, Zoltek Companies, Inc. (the "Registrant")
announced that it had completed the private placement of $20 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, as amended by that certain
Amendment No. 1 to Loan and Warrant Agreement and Registration Rights
Agreement, dated as of April 28, 2006 (as amended, the "Amended Loan
Agreement"), among the Registrant and the lender parties thereto
("Lenders"). As previously reported by the Registrant, the Amended Loan
Agreement provides for the Registrant to issue up to $60 million aggregate
principal amount of senior convertible notes, along with warrants to
purchase its Common Stock. To date, the Registrant has issued an aggregate
of $50 million of senior convertible notes under the Amended Loan Agreement.
The closing of previous fundings under the Amended Loan Agreement were
completed on September 30, 2005, November 30, 2005, and February 6, 2006.
Copies of the original Loan and Warrant Agreement and the amendment thereto
are incorporated by reference as Exhibit 4.1 and Exhibit 4.2, respectively,
to this Report.
The Notes, the form of which is included as Exhibit 4.3 to
this Report (the "Notes"), are convertible into shares of the Registrant's
Common Stock at an intial conversion price of $25.51 per share (subject to
adjustment). The Notes mature 42 months from the closing date and bear
interest, payable quartely, at the rate of 7.5% per annum for 18 months, and
therafter at LIBOR plus four percent per annum. 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
Registrant 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 are secured by a
pledge of certain real property and fixed assets associated with the
operations of Zoltek Rt., the Registrant's Hungarian subsidiary
In connection with the issuance of the Notes, Registrant
issued to the Lenders warrants to purchase an aggregate of up to 274,406
shares of Common Stock at an initial exercise price of $28.06 per share, and
111,113 shares of Common Stock at an initial exercise price of $.01 per
share (collectively, the "Warrants"). The Warrants, the form of which are
incorporated by reference in this report as Exhibit 4.4 and Exhibit 4.5,
respectively, have five-year terms.
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 may be adjusted based upon
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 4.6 ("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 of is qualified in its entirety by
the Loan and Warrant Agreement and amendment thereto, the form of Notes, the
form of 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 May 15, 2006, the Registrant issued a press release
announcing that it had completed the funding of Notes under the Loan
Agreement in the amount of $20.0 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: May 16, 2006
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 Amendment No. 1 to Loan and Warrant Agreement and
Registration Rights Agreement among the Registrant and the
Lenders, filed as Exhibit 4.2 to the Registrant's Current
Report on Form 8-K dated May 1, 2006 and incorporated
herein by reference.
4.3 Form of Note, filed as Exhibit 4.3 to the Registrant's
Current Report on Form 8-K dated May 1, 2006 and
incorporated herein by reference.
4.4 Form of Warrant, filed as Exhibit 4.4 to the Registrant's
Current Report on Form 8-K dated May 1, 2006 and
incorporated herein by reference.
4.5 Form of Warrant, filed as Exhibit 4.5 to the Registrant's
Current Report on Form 8-K dated May 1, 2006 and
incorporated herein by reference.
4.6 Registration Rights Agreement, dated as of September 30,
2005, by and among the Registrant and the Lender 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 Press Release, dated May 15, 2006.
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