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): June 18, 2008
TALON INTERNATIONAL, INC.
(Exact Name of Registrant as Specified in Charter)
DELAWARE 1-13669 95-4654481
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
21900 BURBANK BLVD., SUITE 270
WOODLAND HILLS, CALIFORNIA 91367
(Address of Principal Executive Offices) (Zip Code)
(818) 444-4100
(Registrant's Telephone Number, Including Area Code)
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.
LONNIE SCHNELL EMPLOYMENT AGREEMENT
On June 18, 2008, Talon International, Inc. entered into an Executive
Employment Agreement with Lonnie D. Schnell, pursuant to which Mr. Schnell will
serve as our Chief Executive Officer. This employment agreement has a term
continuing though December 31, 2010, which may be extended to December 31, 2011.
Pursuant to this agreement, Mr. Schnell will receive an annual base salary of
$275,000 for 2008, $300,000 for 2009, and $325,000 for each subsequent year of
the term and will be entitled to receive an annual incentive bonus, which for
2008 will be based upon our earnings before interest, taxes, depreciation and
amortization. Mr. Schnell is entitled to an auto allowance of $1,000 per month,
and reimbursement of up to $10,000 for legal fees incurred in connection with
the negotiation of his employment agreement. In the event that prior to the end
of the term, Mr. Schnell's employment is terminated by us "without cause" (as
defined in the agreement), by Mr. Schnell for "good reason" (as defined in the
agreement) or due to Mr. Schnell's death or disability, then conditional upon
his execution of a release of claims, Mr. Schnell or his estate will be entitled
to receive, in addition to all accrued salary, (i) severance payments equal to
Mr. Schnell's base salary for the remaining term of the agreement or, in the
case of death or disability, through December 31, 2010, (ii) a pro rated portion
of the annual incentive bonus for the year in which the termination occurred,
(iii) full acceleration of vesting of the options issued to Mr. Schnell pursuant
to the agreement and all other options held by him, and (iv) continued medical
coverage for Mr. Schnell and his dependents for the remaining term of the
agreement. In connection with the employment agreement, Mr. Schnell will be
granted an option to purchase 900,000 shares of our common stock, which vests in
full on December 31, 2010, subject to earlier vesting if Mr. Schnell meets
performance criteria established by the Board for fiscal 2008 and 2009. Mr.
Schnell's options will vest in full upon a change of control of our company or
upon termination of Mr. Schnell's employment without cause, for good reason or
due to his death or disability.
LARRY DYNE EMPLOYMENT AGREEMENT
On June 18, 2008, we entered into an Executive Employment Agreement
with Larry Dyne, pursuant to which Mr. Dyne will serve as our Executive Vice
President of Global Sales. This employment agreement has a term continuing
though December 31, 2010, which may be extended to December 31, 2011. Pursuant
to this agreement, Mr. Dyne will receive an annual base salary of $250,000 for
2008, $275,000 for 2009, and $300,000 for each subsequent year of the term and
will be entitled to receive an annual incentive bonus, which for 2008 will be
based upon our earnings before interest, taxes, depreciation and amortization.
Mr. Dyne is entitled to an auto allowance of $950 per month, and reimbursement
of up to $10,000 for legal fees incurred in connection with the negotiation of
his employment agreement. In the event that prior to the end of the term, Mr.
Dyne's employment is terminated by us "without cause" (as defined in the
agreement), by Mr. Dyne for "good reason" (as defined in the agreement) or due
to Mr. Dyne's death or disability, then conditional upon his execution of a
release of claims, Mr. Dyne or his estate will be entitled to receive, in
addition to all accrued salary, (i) severance payments equal to Mr. Dyne's base
salary for the remaining term of the agreement or, in the case of death or
disability, through December 31, 2010, (ii) a pro rated portion of the annual
incentive bonus for the year in which the termination occurred, (iii) full
acceleration of vesting of the options issued to Mr. Dyne pursuant to the
agreement and all other options held by him, and (iv) continued medical coverage
for Mr. Dyne and his dependents for the remaining term of the agreement. In
connection with the employment agreement, Mr. Dyne will be granted an option to
purchase 700,000 shares of our common stock, which vests in full on December 31,
2010, subject to earlier vesting if Mr. Dyne meets performance criteria
established by the Board for fiscal 2008 and 2009. Mr. Dyne's options will vest
in full upon a change of control of our company or upon termination of Mr.
Dyne's employment without cause, for good reason or due to his death or
disability.
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ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits.
The following exhibits are filed herewith:
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
10.1 Executive Employment Agreement, dated June 18, 2008, between Talon
International, Inc. and Lonnie Schnell.
10.2 Executive Employment Agreement, dated June 18, 2008, between Talon
International, Inc. and Larry Dyne.
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SIGNATURE
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.
TALON INTERNATIONAL, INC.
Date: June 23, 2008 By: /S/ LONNIE D. SCHNELL
---------------------------------------------
Lonnie D. Schnell, Chief Executive Officer
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