8-K

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): April 17, 2017

Cartesian, Inc.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation) 001-34006  (Commission File Number) 48-1129619 (I.R.S. Employer Identification No.)

7300 College Boulevard, Suite 302

Overland Park, Kansas 66210

(Address of principal executive office)(Zip Code)

(913) 345-9315

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended

transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 1.01. Entry into a Material Definitive Agreement.

On April 17, 2017, Cartesian, Inc. (the “Company”) entered into a letter agreement (the “Letter Agreement”) with Andrew Jim Kelley Glasspool, Stephen Mark Upton, Mobiflux, Gary Marshall, Lionel Tranchard and Jean-Marc Racine (collectively, the “Sellers”). The Letter Agreement relates to the prior acquisition by the Company of Farncombe France SARL and Farncombe Technology Limited (collectively, the “Farncombe Entities”) from the Sellers pursuant to the Share Purchase Agreement dated July 22, 2015 (the “Purchase Agreement”) among the Company and the Sellers. The letter agreement is effective as of April 4, 2017.

Under the Purchase Agreement, the purchase consideration for the capital stock of the Farncombe Entities included, in addition to consideration payable at Closing, cash payable after Closing upon determination of the net working capital of the Farncombe Entities (the “Deferred Consideration”) and the contingent right of Sellers to receive additional cash and shares of Company common stock pursuant to an earn-out (the “Earn-Out”) based upon the performance of the Farncombe Entities after Closing. The aggregate amount potentially payable pursuant to the Earn-Out consisted of cash in an amount up to £719,483 pounds sterling (approximately US$0.9 million based on an exchange rate of £1.000 = US$1.255 as of April 17, 2017) and up to 461,055 shares of Company common stock.

In the Letter Agreement, the parties agreed to a final determination of the Deferred Consideration, pursuant to which the Company agreed to pay to Sellers an additional amount equal to any amount received by the Company following the date of the Letter Agreement in respect of repayment of a loan of €50,000 (approximately US$53,000 based on an exchange rate of €1.000 = US$1.063 as of April 17, 2017) made to a third party by Farncombe Technology Limited prior to the closing under the Purchase Agreement. The parties also agreed that the Earn-Out target was expected to be achieved, and that the Company would pay 100% of the Earn-Out consideration described above to the Sellers no later than July 31, 2017. The Company also agreed in separate agreements that performance-based awards granted to two of the Sellers as employees of the Company based upon achievement of the Earn-Out would be paid in full.

The foregoing description of the Letter Agreement, which is attached hereto as Exhibit 2.1 and incorporated by reference herein, does not purport to be complete and is qualified in its entirety by reference to the Letter Agreement.

Item 3.02. Unregistered Sales of Equity Securities.

The information contained in Item 1.01 is hereby incorporated by reference into this Item 3.02.

The shares of Company common stock to be issued pursuant to the Earn-Out have not been registered under the Securities Act of 1933, as amended (“Securities Act”), in reliance on the exemption in Regulation S promulgated under the Securities Act and on the private offering exemption of Section 4(a)(2) of the Securities Act. The Company is issuing the shares of its common stock in a private offering to a limited number of Sellers who the Company believes are sophisticated, are located outside of the United States and are not "U.S. Persons." The Sellers agreed in the Purchase Agreement to customary restrictions on resale under applicable securities laws and additional resale restrictions specified in the Purchase Agreement.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description
2.1	Letter Agreement, effective April 4, 2017, among Cartesian, Inc. and the Sellers referenced therein.
99.1	Press Release dated April 19, 2017.

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.

CARTESIAN, INC.
By:	/s/ Peter H. Woodward
	Peter H. Woodward Chief Executive Officer

Date: April 19, 2017

EXHIBIT INDEX

Exhibit No.	Description
2.1	Letter Agreement, effective April 4, 2017, among Cartesian, Inc. and the Sellers referenced therein.
99.1	Press Release dated April 19, 2017.

EX-2.1

Exhibit 2.1

To:

(1) Andrew Glasspool of Headley Lodge, Ockford Road, Godalming, Surrey GU7 1QP;

(2) Stephen Upton of Manor Farm, East Dean, Salisbury SP5 1HB;

(3) Mobiflux whose registered office is 8 avenue Villemain, 75014 Paris, France;

(4) Gary Marshall of 57 Penn Lea Road, Bath, BA1 3RB;

(5) Jean-Marc Racine of 8 avenue Villemain, 75014 Paris, France; and

(6) Lionel Tranchard of 7 impasse Ambroise Paré, 78800 Houilles, France.

4 April 2017

Dear Sirs

Farncombe Acquisition

We refer to the share purchase agreement dated 22 July 2015 (“SPA”) made between the above-named persons (together the “Sellers” or “you”) and Cartesian Inc. (the “Buyer” or “us”). Terms defined in the SPA shall, unless the context requires otherwise, have the same meaning when used in this deed.

Clause 3.1(c) of the SPA provides that certain Deferred Consideration may be payable to the Sellers, subject to adjustment in accordance with clause 5.2 of the SPA. The Completion Statements having been agreed by the Sellers and the Buyer, and aggregate payments of £1,677,636.00 made to the Sellers (as set out in Schedule One to this deed), the parties have now agreed the remaining amounts to be payable to the Sellers in respect of such Deferred Consideration.

Clause 3.1(d) of the SPA provides that certain Earn-Out Consideration may be payable to the Sellers to be calculated and paid in accordance with Schedule 8 of the agreement. In anticipation that the Earn-out Target will be achieved, the Buyer has agreed that 100% of the Earn-out Consideration shall be paid to the Sellers on the terms set out herein.

Following negotiation, in order to avoid incurring unnecessary professional costs and expenses, each of the Sellers and the Buyer hereby agrees and confirms that:-

Earn-out Consideration

1. The aggregate sum of £719,484.87 shall be paid in cash to the Sellers no later than 31 July 2017, to such accounts as they may nominate in writing to the Buyer, apportioned as set out in Part 1 of Schedule Two to this deed.

2. A total of 461,055 Consideration Shares shall be issued to the Sellers in accordance with the SPA, no later than 31 July 2017, apportioned as set out in Part 2 of Schedule Two to this deed.

The Consideration Shares shall not be deemed to be transferred to the Sellers or outstanding until the delivery of the Consideration Shares to the Sellers. The Sellers shall only be entitled to receive any dividend or distribution in respect of the Consideration Shares if the record date for such dividend or distribution is after such delivery date.

The number of Consideration Shares and the form of such consideration payable under this paragraph shall be subject to adjustment as determined in good faith by the Board of Directors of the Buyer to reflect appropriately any stock split, reverse stock split, stock dividend, merger, consolidation, conversion, reorganization, reclassification, exchange of shares or other like change with respect to shares of common stock of the Buyer (including any conversion of such shares into cash, property or securities in connection with any such transaction) occurring or having a record date prior to the date of transfer of such Consideration Shares to the Sellers. No such adjustment shall be made with respect to any issuance or sale of securities by the Buyer, any repurchase of

securities by the Buyer or any dividends or distributions (other than stock dividends) declared or paid on the common stock of the Buyer.

Deferred Consideration

3. A cash payment equal to any amount received by a member of the Buyer’s Group following the date of this deed in respect of repayment of the loan of €50,000 made to Competitive Market Analysis Group by Farncombe UK prior to Completion shall be made to the Sellers within 5 Business Days of the date of receipt thereof, less all reasonable costs, charges and expenses incurred by the Buyer and the Buyer’s Group in recovering the repayment. Any such payment shall be apportioned as set out in Part 3 of Schedule Two to this deed.

General

4. If the Buyer fails to pay any sum due to the Sellers under this deed by the relevant due date then the Buyer shall pay interest on the overdue sum from the relevant due date until the date upon which payment of that sum is made (whether before or after judgment) at the rate of 4% a year above the Bank of England’s base rate from time to time.

5. This deed is entered into in full and final settlement of any claims, rights or actions the Sellers or any of them may have to or in respect of the Deferred Consideration and the Earn-out Consideration under the SPA and each Seller hereby waives in full any such claims, rights or actions with effect from the date of this deed (without prejudice to the Sellers’ rights to enforce the provisions set out herein). In particular, the provisions of Schedule 8 of the SPA (including the Earn-out Protections in paragraph 7 of Schedule 8) shall cease to be of further force or effect from the date of this deed. Save as set out herein, no Seller shall be entitled to any further consideration in respect of the Sale Shares under the SPA, whether in respect of Deferred Consideration, Earn-out Consideration or otherwise. In all other respects, the SPA shall remain in full force and effect, provided that the Buyer may transfer or relinquish Control of Farncombe France, or dispose of all or substantially all of the business and assets of Farncombe France, without such transfer, relinquishment or disposal triggering early payment of the Earn-Out Consideration under clause 3.3 of the SPA.

6. This deed shall be without prejudice to the rights of the Buyer under the SPA (including, without limitation, subject always to the terms of the SPA, in respect of any Relevant Claim) or which it would otherwise be entitled to bring against all or any of the Sellers. Such rights shall remain in full force and effect.

7. Each of the Sellers and the Buyer shall keep the fact and terms of this deed confidential and hereby severally undertake not to disclose them to any third party (other than their professional advisers, including auditors), save where otherwise required by operation of law or any regulatory body or with the written consent of Stephen Upton on behalf of all the Sellers and any director on behalf of the Buyer. Each of the Sellers hereby acknowledges and agrees that the Buyer will be required to file and make publicly available a copy of this agreement under the SEC rules.

8. This deed may be executed in any number of counterparts, each of which when executed shall constitute a duplicate original, but all the counterparts shall together constitute the one deed.

9. This deed and any disputes or claims (including non-contractual disputes or claims) arising out of or in connection with it or its subject matter or formation shall be governed by and construed in accordance with the law of England and Wales. Each of the Sellers and the Buyer agrees that the courts of England and Wales shall have exclusive jurisdiction to settle any dispute or claim (including non-contractual disputes and claims) arising out of or in connection with this deed or its subject matter or formation.

This letter has been executed and delivered as a deed on the date stated above.

EXECUTED and DELIVERED as a DEED)

by Peter Woodward for and on behalf) /s/ Peter Woodward

of CARTESIAN INC.)

in the presence of:

Signature of witness: /s/ Carolyn Hughes

Name of witness: Carolyn Hughes

Address of Witness:

We, the Sellers, acknowledge receipt of and agree to the terms of the above letter on the date stated above.

EXECUTED and DELIVERED as a DEED)

by ANDREW JIM KELLEY GLASSPOOL) /s/ Andrew Jim Kelley Glasspool

in the presence of:

Signature of witness: /s/ Diana Carmona

Name of witness: Diana Carmona

Address of Witness:

EXECUTED and DELIVERED as a DEED)

by STEPHEN MARK UPTON) /s/ Stephen Mark Upton

in the presence of:

Signature of witness: /s/ Paul Rusby

Name of witness: Paul Rusby

Address of Witness:

EXECUTED and DELIVERED as a DEED)

by JEAN-MARC RACINE for and on behalf)

of MOBIFLUX) /s/ Jean-Marc Racine

in the presence of:

Signature of witness: /s/ Ducray Nathalie

Name of witness: Ducray Nathalie

Address of Witness:

EXECUTED and DELIVERED as a DEED)

by JEAN-MARC RACINE) /s/ Jean-Marc Racine

in the presence of:

Signature of witness: /s/ Ducray Nathalie

Name of witness: Ducray Nathalie

Address of Witness:

EXECUTED and DELIVERED as a DEED)

by GARY MARSHALL) /s/ Gary Marshall

in the presence of:

Signature of witness: /s/ Martin Banham

Name of witness: Martin Banham

Address of Witness:

EXECUTED and DELIVERED as a DEED)

by LIONEL TRANCHARD) /s/ Lionel Tranchard

in the presence of:

Signature of witness: /s/ Virginie Rodari

Name of witness: Virginie Rodari

Address of Witness:

List of Schedules Omitted from Letter Agreement

Schedule One - Deferred Consideration

Schedule Two - Apportionment among Sellers

Upon request, the registrant agrees to furnish supplementally to the Securities and Exchange Commission a copy of any omitted schedule to the Letter Agreement; provided, however, that the registrant may request confidential treatment of omitted items prior to any public disclosure.

EX-99.1

Exhibit 99.1

Cartesian Enters Letter Agreement to Conclude the Farncombe Deferred Consideration and Earn-Out Payments

Overland Park, KS- April 19, 2017- Cartesian™ (NASDAQ: CRTN), a leading provider of consulting services and managed solutions to the global communications, technology and digital media industries, has entered into a letter agreement with the sellers of Farncombe agreeing to a final determination of the remaining consideration payable to the sellers.

Under the Share Purchase Agreement entered into on July 22, 2015, the purchase consideration for the capital stock of Farncombe included, in addition to consideration payable at closing, deferred consideration payable in cash after closing upon determination of the net working capital of Farncombe and the contingent right of the sellers to receive additional cash and shares of Cartesian stock pursuant to a two-year earn-out based upon the performance of Farncombe after closing.

In the letter agreement, Cartesian and Farncombe have agreed to a final determination of the deferred consideration. The parties have also agreed that the earn-out target is expected to be achieved, and that Cartesian will pay to the sellers of Farncombe the full amount of the earn-out in cash and shares of Cartesian stock by no later than July 31, 2017. The earn-out amount, including the value of the stock component, was set at the time of the acquisition of Farncombe by Cartesian.

“After two years of strong performance from Farncombe, we are pleased to finally bring this consideration process to a close and officially consolidate the two corporate entities,” said Cartesian CEO, Peter Woodward. “Farncombe’s ability to achieve its full earn-out target is a testament to not only its impeccable reputation in the video delivery space, but also to the managerial strength of the unit’s principals who have collectively guided the company towards continued growth and success. Looking ahead, we will continue to leverage Farncombe’s expertise in OTT and other video services and the network competencies to drive additional cross-selling opportunities.”

About Cartesian, Inc.

Cartesian, Inc. (NASDAQ: CRTN) is a specialist provider of consulting services and managed solutions to leaders in the global communications, technology and digital media industries. Cartesian provides strategic advice, management consulting, and managed solutions to clients worldwide. The company has offices in Boston, Kansas City, London, New York, Philadelphia and Washington. For more information, visit www.cartesian.com.

Investor Contact:

Matt Glover or Najim Mostamand

Liolios Group, Inc.

949-574-3860

CRTN@liolios.com