UNITED STATES
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): AUGUST 4, 2005
THE A CONSULTING TEAM, INC.
(Exact name of registrant as specified in its charter)
NEW YORK 0-22945 13-3169913
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
200 PARK AVENUE SOUTH, NEW YORK, NEW YORK 10003
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (212) 979-8228
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 1.02. TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT.
On August 4, 2005, The A Consulting Team, Inc. ("TACT") terminated each
of the following agreements pursuant to their terms, each of which was
terminable if not consummated prior to or at July 31, 2005:
(a) the Share Exchange Agreement, dated as of January 21, 2005 among
TACT, Vanguard Info-Solutions Corporation, a New Jersey corporation formerly
known as B2B Solutions, Inc. ("Vanguard"), the stockholders of Vanguard named
therein (the "Vanguard Stockholders"), the authorized representative named
therein and TACT (the "Share Exchange Agreement"). Pursuant to the Share
Exchange Agreement, TACT agreed to a transaction (the "Exchange Transaction") in
which TACT would acquire all of the issued and outstanding shares of capital
stock of Vanguard in exchange for an aggregate of 7,312,796 shares of common
stock of TACT, $.01 par value per share ("Common Shares"). 6,312,796 Common
Shares would be issued to the Vanguard Stockholders upon consummation of the
transactions contemplated by the Share Exchange Agreement. 1,000,000 Common
Shares would be delivered by TACT into escrow for a period of one year to secure
indemnification obligations of certain of the Vanguard Stockholders. The
consummation of the Exchange Transaction required the approval of the holders of
TACT capital stock and was subject to customary conditions to closing, as well
as the consummation of the Company Stock Purchase Transaction and the Selling
Shareholder Stock Purchase Transaction, each as defined below.
(b) the Stock Purchase Agreement, dated as of January 21, 2005, between
TACT and Oak Finance Investments Limited ("Oak"), a British Virgin Islands
company (the "Company Stock Purchase Agreement"). Pursuant to the Company Stock
Purchase Agreement, TACT agreed to sell, and Oak agreed to purchase, 625,000
Common Shares at a purchase price of $8.00 per Common Share (the "Company Stock
Purchase Transaction"). TACT also granted to Oak, or an assignee of Oak, an
option to purchase an additional 625,000 Common Shares at a purchase price of
$8.00 per Common Share within 120 days of the consummation of the transactions
contemplated by the Company Stock Purchase Agreement. The consummation of the
transactions contemplated by the Company Stock Purchase Agreement required the
approval of the holders of TACT capital stock and was subject to customary
conditions to closing, as well as the consummation of the Exchange Transaction
and the Selling Shareholder Stock Purchase Transaction.
Notice of the termination of the Share Exchange Agreement and the
Company Stock Purchase Agreement was sent by TACT on August 4, 2005 as required
by such agreements.
On August 4, 2005 Shmuel BenTov, the Chairman of the Board of Directors
of TACT and its Chief Executive Officer (the "Selling Shareholder"), terminated
the Stock Purchase Agreement (the "Shareholder Stock Purchase Agreement"), dated
as of January 21, 2005, between the Selling Shareholder and Oak. Pursuant to the
Shareholder Stock Purchase Agreement, the Selling Shareholder agreed to sell,
and Oak agreed to purchase, 1,024,697 Common Shares beneficially owned by the
Selling Shareholder at a purchase price of $10.25 per Common Share (the "Selling
Shareholder Stock Purchase Transaction"), provided, that if TACT did not pay a
dividend on the Common Shares of $0.75 per Common Share on or prior to the date
that the transactions contemplated by the Shareholder Stock Purchase Agreement
were consummated, then the price per Common Share payable to the Selling
Shareholder would be increased by the amount of the difference between $0.75 and
the amount of any dividend
actually paid. Prior to the consummation of the Selling Shareholder Stock
Purchase Transaction, the Selling Shareholder was required to convert all shares
of preferred stock of TACT owned by him into Common Shares. The Selling
Shareholder and Oak entered into a Principal Shareholder's Agreement (the
"Voting Agreement") in connection with their execution and delivery of the
Shareholder Stock Purchase Agreement. Pursuant to the Voting Agreement, the
Selling Shareholder agreed to, among other things, vote all Common Shares
beneficially owned by him (excluding 3,750 Common Shares beneficially owned by
the Selling Shareholder that are held of record by Ronit BenTov, the spouse of
the Selling Shareholder) in favor of the Exchange Transaction and the Company
Stock Purchase Transaction at any meeting of the holders of any class or classes
of capital stock of TACT called to approve such transactions (or any written
consents distributed in lieu of a meeting). The Selling Shareholder also granted
Oak an irrevocable proxy to, among other things, vote all Common Shares
beneficially owned by him (excluding 3,750 Common Shares beneficially owned by
the Selling Shareholder that are held of record by Ronit BenTov, the spouse of
the Selling Shareholder) in favor of the Exchange Transaction and the Company
Stock Purchase Transaction at any meeting of the holders of any class or classes
of capital stock of TACT. The consummation of the transactions contemplated by
the Shareholder Stock Purchase Agreement was subject to customary conditions to
closing, as well as the consummation of the Exchange Transaction and the Company
Stock Purchase Transaction and TACT and the Selling Shareholder entering into an
amendment to the Selling Shareholder's existing employment agreement.
Notice of the termination of the Shareholder Stock Purchase Agreement
was sent by the Selling Shareholder on August 4, 2005 as required by such
agreement.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
Exhibit No. Description
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99.1 Press release dated August 4, 2005 regarding the circumstances
discussed in this report.
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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 hereunto duly authorized.
THE A CONSULTING TEAM, INC.
DATE: August 5, 2005 By: /s/ Shmuel BenTov
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Shmuel BenTov, Chairman
Chief Executive Officer and President
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
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99.1 Press release dated August 4, 2005