-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VhVQMrMl2X36dvbkK7WmjKRVOKNH1mdw4l/qTbDGysRo0rv/JZPH5ltnGUqGbrQX r4y3nZvn7S3TxAWzJWWtUw== 0001172665-08-000003.txt : 20080107 0001172665-08-000003.hdr.sgml : 20080107 20080107165629 ACCESSION NUMBER: 0001172665-08-000003 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20071231 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Unregistered Sales of Equity Securities ITEM INFORMATION: Changes in Control of Registrant ITEM INFORMATION: Other Events FILED AS OF DATE: 20080107 DATE AS OF CHANGE: 20080107 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KRONOS ADVANCED TECHNOLOGIES INC CENTRAL INDEX KEY: 0001108248 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL & COMMERCIAL FANS & BLOWERS & AIR PURIFYING EQUIP [3564] IRS NUMBER: 870440410 STATE OF INCORPORATION: NV FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-30191 FILM NUMBER: 08515706 BUSINESS ADDRESS: STREET 1: 333 S STATE ST STREET 2: PMB111 CITY: LAKE OSWEGO STATE: OR ZIP: 97034 BUSINESS PHONE: 5035981900 MAIL ADDRESS: STREET 1: 333 S STATE ST STREET 2: PMB 111 CITY: LAKE OSWEGO STATE: OR ZIP: 97034 FORMER COMPANY: FORMER CONFORMED NAME: TSET INC DATE OF NAME CHANGE: 20000301 8-K 1 form8k.txt ITEMS 1.01, 3.02, 5.01 AND 8.01 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): December 31, 2007 Kronos Advanced Technologies, Inc. (Exact name of registrant as specified in its charter) Nevada 000-30191 87-0440410 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 464 Common Street, Suite 301, Belmont, Massachusetts 02478 (Address of principal executive offices) (Zip code) (617) 364-5089 (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)) Item 1.01 Entry into a Material Definitive Agreement On December 31, 2007, Kronos Advanced Technologies, Inc. (the "Company") entered into Amendment No. 1 to Kronos Advanced Technologies, Inc. Secured Promissory Note (the "Note Amendment") with Sands Brothers Venture Capital LLC, a New York limited liability company ("Sands I"), Sands Brothers Venture Capital II LLC, a New York limited liability company ("Sands II"), Sands Brothers Venture Capital III LLC, a New York limited liability company ("Sands III"), Sands Brothers Venture Capital IV LLC, a New York limited liability company ("Sands IV") and Critical Capital Growth Fund, L.P., a Delaware limited partnership and a debenture licensed U.S. Small Business Investment Company ("CCGF" and together with Sands I, Sands II, Sands III and Sands IV, the "Holder"). Pursuant to the Note Amendment, the maturity date of Secured Convertible Promissory Note dated June 19, 2007 in the principal amount of up to $859,000 (the "CCGF Note") was extended to February 29, 2008 from December 31, 2007 and a correction was made to the Conversion Price (as defined in the Note) to equal $0.0030, subject to adjustment from time to time as specified in the CCGF Note. In addition, pursuant to the Note Amendment, the Company agreed to pay the holder an amendment fee comprised of (a) either a $25,000 cash payment or 1,470,588 shares of the Company's common stock and (b) an additional 1,470,588 shares of the Company's common stock. This description of the Note Amendment does not purport to be complete and is qualified in its entirety by reference to the Note Amendment, a copy of which is attached as Exhibit 10.1 hereto and is incorporated herein by reference. Item 3.02 Unregistered Sales of Equity Securities The disclosure contained in Item 5.01 is hereby incorporated by reference. Item 5.01 Changes in Control of Registrant Effective December 31, 2007, (1) AirWorks Funding LLLP ("AirWorks") elected to convert $438,864.12 of the principal amount of its Secured Convertible Promissory Note due June 19, 2010 (the "AirWorks Note") into 146,288,040 shares of the Company's common stock in accordance with the terms of the AirWorks Note and (2) Hilltop Holding Company, LP ("Hilltop") elected to convert $292,576.08 of the principal amount of its Secured Convertible Promissory Note due June 19, 2010 (the "Hilltop Note") into 97,525,360 shares of the Company's common stock in accordance with the terms of the Hilltop Note. The Hilltop Note was transferred to Hilltop from RS Properties I LLC on August 8, 2007. The issuance of the shares of the Company's common stock to AirWorks and Hilltop is being made in reliance on the registration exemption provided by Section 4(2) of the Securities Exchange Act of 1933, as amended. As a result of the conversion of the AirWorks Note and Hilltop Note described above, there has been a change in control of the Company. The 146,288,040 shares of the Company's common stock issued as a result of the conversion of the AirWorks Note constitute approximately 30% of the total outstanding shares of the Company's common stock. The 97,525,360 shares of the Company's common stock issued as a result of the conversion of the Hilltop constitute approximately 20% of the total outstanding shares of the Company's common stock. Following the conversion of the AirWorks Note and the Hilltop Note, AirWorks and Hilltop have approved certain corporate actions of the Company which are described in Item 8.01 below. In addition, the Company expects AirWorks and Hilltop to exercise their right, pursuant to certain agreements entered into in connection with the initial issuance of the AirWorks Note and the Hilltop Note, to designate a majority of the members of the Company's Board of Directors. Item 8.01 Other Events On December 14, 2007, the Company's Board of Directors approved a reincorporation/recapitalization of the Company which will include (1) the Company being reincorporated in the State of Delaware via a reincorporation merger with a newly created subsidiary of the Company, (2) increasing the authorized share capital of the Company to 500,000,000,000 shares of common stock and 100,000,000 shares of preferred stock and (3) making certain other changes to the organizational documents of the Company. Effective December 31, 2007, and following the conversion of the AirWorks Note and Hilltop Note described in Item 5.01, a majority of the stockholders of the Company approved the reincorporation/recapitalization by written consent. Prior to the effectiveness of the reincorporation/recapitalization, the Company will be distributing an information statement to its stockholders in accordance with Schedule 14C of the Securities and Exchange Act of 1934, as amended. Such information statement will include additional details regarding the reincorporation/recapitalization. A copy of the Company's press release regarding the matters described above is attached hereto as Exhibit 99.1 and is hereby incorporated by reference. Item 9.01 Financial Statements, Pro Forma Financial Information and Exhibits. (d) Exhibits. 10.1 Amendment No. 1 to Kronos Advanced Technologies, Inc. Secured Promissory Note dated December 31, 2007. 99.1 Company News Release dated January 8, 2008. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: January 8, 2008 KRONOS ADVANCED TECHNOLOGIES, INC. By: /s/ Daniel R. Dwight --------------------------- Name: Daniel R. Dwight Title: Chief Executive Officer and President EX-10.01 2 ex101.txt AMENDMENT TO DECEMBER 31, 2007 SECURED PROMISSORY NOTE AMENDMENT NO. 1 TO KRONOS ADVANCED TECHNOLOGIES, INC. SECURED CONVERTIBLE PROMISSORY NOTE This Amendment No. 1 to the Kronos Advanced Technologies, Inc. (the "Maker") Secured Convertible Promissory Note is entered into as of December 31, 2007 ("Amendment No. 1") by and between the Maker and Sands Brothers Venture Capital LLC, a New York limited liability company ("Sands I"), Sands Brothers Venture Capital II LLC, a New York limited liability company ("Sands II"), Sands Brothers Venture Capital III LLC, a New York limited liability company ("Sands III"), Sands Brothers Venture Capital IV LLC, a New York limited liability company ("Sands IV") and Critical Capital Growth Fund, L.P., a Delaware limited partnership and a debenture licensed U.S. Small Business Investment Company ("CCGF") (Sands I, Sands II, Sands III, Sands IV, and CCGF, together with their respective successors, representatives, and permitted assigns, are collectively referred to as, the "Holder"). RECITALS A. Maker issued the Holder a Secured Convertible Promissory Note dated June 19, 2007 in the principal amount of up to Eight Hundred Fifty-Nine Thousand Dollars ($859,000.00) with an initial Maturity Date of December 31, 2007 (the "Note"). Capitalized terms used herein but not otherwise defined shall have the meanings given them in the Note. B. Maker and Holder desire to amend the terms of the Note to extend the Maturity Date to February 29, 2008 and correct the Conversion Price (as defined in the Note). NOW, THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: 1. Extension of Maturity Date. The Maturity Date of the Note is hereby extended to February 29, 2008 (the "New Maturity Date"). All references in the Note to December 31, 2007 or Maturity Date shall be deemed to be a reference to the New Maturity Date. 2. Correction of Conversion Price. Section 3.2 of the Note is amended in its entirety as follows: "The Term "Conversion Price" shall mean $0.0030, subject to adjustment under Section 3.4 hereof." 3. Amendment Fee. In addition to any fees or other amounts payable by Maker to the Holder under the terms of Note, Maker agrees to pay to the Holder an amendment fee comprised of (a) at the option of the Holder, pursuant to written notice delivered to Maker at least three business days prior to the New Maturity Date, (i) a $25,000 cash payment or (ii) the issuance to the Holder of 1,470,588 shares of the Maker's common stock, par value $0.001 per share (the "Common Stock") and (b) the issuance to the Holder of 1,470,588 shares of the Maker's Common Stock, in each case, due and payable on the New Maturity Date. 4. Miscellaneous. Except as specifically set forth in this Amendment No. 1, all of the terms and conditions of the Note shall remain in full force and effect. This Amendment No. 1 shall be governed by and construed in accordance with the internal laws of the State of New York, without giving effect to any of the conflicts of law principles which would result in the application of the substantive law of another jurisdiction. This Amendment No. 1 may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. [Signatures on following page] IN WITNESS WHEREOF, Maker and Holder have each executed and delivered this Amendment No. 1 as of the day and year first above written. MAKER: Kronos Advanced Technologies, Inc. By: /s/ Daniel R. Dwight --------------------------------------- Name: Daniel R. Dwight Title: Chief Executive Officer and President HOLDER: Sands Brothers Venture Capital LLC By: /s/ Scott Baily --------------------------------------- Name: Scott Baily Title: Chief Administration Officer Sands Brothers Venture Capital II LLC By: /s/ Scott Baily --------------------------------------- Name: Scott Baily Title: Chief Administration Officer Sands Brothers Venture Capital III LLC By: /s/ Scott Baily --------------------------------------- Name: Scott Baily Title: Chief Administration Officer Sands Brothers Venture Capital IV LLC By: /s/ Scott Baily --------------------------------------- Name: Scott Baily Title: Chief Administration Officer Critical Capital Growth Fund, L.P. By: Critical Capital, L.P., its general partner By: Critical Capital Corporation, its general partner By: /s/ Charles Robinson ---------------------------------- Name: Charles Robinson Title: President By: /s/ Steven Sands ---------------------------------- Name: Steven Sands Title: Chairman EX-99.1 3 ex991.txt NEWS RELEASE KRONOS ANNOUNCES CONVERSION OF AIRWORKS AND HILLTOP DEBT RESULTING IN A CHANGE OF CONTROL BELMONT, Mass., Jan 8, 2008 -- Kronos Advanced Technologies, Inc. (OTC BB: KNOS) President and Chief Executive Officer of Kronos Advanced Technologies, Inc. ("Kronos"), Daniel R. Dwight, reported certain significant events which are described below. Change in Control of Kronos Effective December 31, 2007, the two largest investors in Kronos, AirWorks Funding LLLP ("Airworks") and Hilltop Holding Company, LP ("Hilltop"), each converted a portion of their secured convertible promissory notes due June 19, 2010 (the "Notes") to common stock of Kronos, which resulted in a change in control of Kronos. Specifically, effective December 31, 2007, AirWorks and Hilltop elected to convert an aggregate of $731,440 of the principal amount of their Notes into an aggregate of 243,813,400 shares of the Company's common stock, in accordance with the terms of their respective notes. The 146,288,040 shares of common stock issued as a result of the conversion of the AirWorks Note constitute approximately 30% of the total outstanding shares of the Kronos' common stock. The 97,525,360 shares of common stock issued as a result of the conversion of the Hilltop Note constitute approximately 20% of the total outstanding shares of the Kronos' common stock. Kronos expects AirWorks and Hilltop to exercise their right, pursuant to agreements entered into in connection with the initial issuance of the Notes, to designate a majority of the members of the Company's Board of Directors. Sands and Critical Capital Debt Extension Effective December 31, 2007, Kronos entered into an amendment to the secured convertible promissory note dated June 19, 2007 in the principal amount of up to $859,000 with the Sands Brothers Venture Capital entities named therein and Critical Capital Growth Fund, L.P., which extended the maturity date of the note to February 29, 2008 from December 31, 2007. Pursuant to the amendment, Kronos agreed to pay the note holders an amendment fee comprised of (a) either a $25,000 cash payment or 1,470,588 shares of Kronos' common stock and (b) an additional 1,470,588 shares of Kronos' common stock. Other Events On December 14, 2007, the Kronos' Board of Directors approved a reincorporation/recapitalization of Kronos which will include (1) Kronos being reincorporated in the State of Delaware via a reincorporation merger with a newly created subsidiary of Kronos, (2) increasing the authorized share capital of Kronos to 500,000,000,000 shares of common stock and 100,000,000 shares of preferred stock and (3) making certain other changes to the organizational documents of Kronos. Effective December 31, 2007, and following the conversion of the AirWorks and Hilltop Notes, a majority of Kronos' stockholders approved the reincorporation/recapitalization by written consent. Prior to the effectiveness of the reincorporation/recapitalization, Kronos will be distributing an information statement to its stockholders in accordance with Schedule 14C of the Securities and Exchange Act of 1934, as amended. This information statement will include additional details regarding the reincorporation/recapitalization. About Kronos Advanced Technologies, Inc. Through its wholly-owned subsidiary, Kronos Air Technologies, Inc., Kronos Advanced Technologies has developed a new, proprietary air movement and purification system that utilizes state-of-the-art high voltage electronics and electrodes to silently move and clean air without any moving parts. Kronos is actively commercializing its technology for standalone and embedded products across multiple residential, commercial, and industrial markets. Kronos' technology is versatile, energy- and cost-efficient and exhibits multiple design attributes, creating a broad range of applications. Kronos' business strategy includes a combination of building internal capabilities, establishing strategic alliances and structuring licensing arrangements. Kronos Advanced Technologies is located in Belmont, MA. More information about Kronos Advanced Technologies is available at www.kronosati.com. Safe Harbor Provision This news release contains forward-looking statements made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, Kronos' views on future financial performance, market growth, capital requirements, new product introductions and acquisitions, and are generally identified by phrases such as ``thinks,'' ``anticipates,'' ``believes,'' ``estimates,'' ``expects,'' ``intends,'' ``plans,'' and similar words. Forward-looking statements are not guarantees of future performance and are inherently subject to uncertainties and other factors which could cause actual results to differ materially from the forward-looking statement. These statements are based upon, among other things, assumptions made by, and information currently available to, managements, including management's own knowledge and assessment of Kronos' industry, R&D initiatives, competition and capital requirements. Other factors and uncertainties that could affect Kronos' forward-looking statements include, among other things, the following: identification of feasible new product initiatives, management of R&D efforts and the resulting successful development of new products and product platforms; acceptance by customers of Kronos' products; substantial expansion of international sales; reliance on key suppliers; the potential need for changes in long-term strategy in response to future developments; competitive factors, including pricing pressures and the introduction by others of new products with similar or better functionality than our products, and ability to obtain additional financing necessary to continue operations . These and other risks are more fully described in Kronos' filings with the Securities and Exchange Commission, including Kronos' Annual Report on Form 10-KSB for the year ended June 30, 2007. Kronos undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. -----END PRIVACY-ENHANCED MESSAGE-----