-----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, DgfBMTFRVbdrSwRgEHmkgXYQR/+3XsezXly1GzqeFuhj8kkUv/RJknR/7CHnfN5B TtqJyPm+uQS1EGz4ALuqaA== 0001157523-04-008221.txt : 20040901 0001157523-04-008221.hdr.sgml : 20040901 20040901133532 ACCESSION NUMBER: 0001157523-04-008221 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040901 ITEM INFORMATION: Termination of a Material Definitive Agreement ITEM INFORMATION: Completion of Acquisition or Disposition of Assets ITEM INFORMATION: Cost Associated with Exit or Disposal Activities ITEM INFORMATION: Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20040901 DATE AS OF CHANGE: 20040901 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DPAC TECHNOLOGIES CORP CENTRAL INDEX KEY: 0000784770 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 330033759 STATE OF INCORPORATION: CA FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-14843 FILM NUMBER: 041010515 BUSINESS ADDRESS: STREET 1: 7321 LINCOLN WAY CITY: GARDEN GROVE STATE: CA ZIP: 92641 BUSINESS PHONE: 7148980007 MAIL ADDRESS: STREET 1: 7321 LINCOLN WAY CITY: GARDEN GROVE STATE: CA ZIP: 92641 FORMER COMPANY: FORMER CONFORMED NAME: DENSE PAC MICROSYSTEMS INC DATE OF NAME CHANGE: 19920703 8-K 1 a4711778.txt DPAC TECHNOLOGIES 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): September 1, 2004 ------------------------------------------------------ DPAC TECHNOLOGIES CORP. ----------------------- (Exact name of registrant as specified in its charter) - -------------------------------------------------------------------------------- California 0-14843 33-0033759 - ---------------------------- ------------- ---------------------- (State or other jurisdiction (Commission I.R.S. Employer of incorporation) File Number) Identification Number - -------------------------------------------------------------------------------- 7321 Lincoln Way, Garden Grove, California 92841 ------------------------------------------------ (Address of principal executive offices) (Zip Code) 714/898-0007 ------------ 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 (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)) Section 1 - Registrant's Business and Operations Item 1.02 Termination of Material Definitive Agreement William M. Stowell's employment with the Registrant terminated on August 31, 2004. According to his employment agreement, as amended, following termination by the Registrant without cause, Mr. Stowell will continue to receive the following benefits through December 7, 2006: (1) his current salary of $170,000 per year; (2) his current benefits including an automobile allowance, health and disability insurance and other benefits at a cost estimated by us to be approximately $1,500 per month currently, and (3) accelerated, immediate vesting and continued exercisability of his previously granted stock options for their life according to their terms as if no termination had taken place on account of his departure. Mr. Stowell holds options to acquire 344,000 shares of our common stock at exercise prices between $1.00 and $6.00, with the weighted average being approximately $2.10. The Company will also provide Mr. Stowell with executive-level out-placement services at the out-placement provider of his reasonable choice. It is hard to estimate this cost at this time. Mr. Stowell's employment agreement and amendment, which contain a more complete description of the Registrant's obligations, are filed as Exhibits 10.8 and10.8.1 to this report and are incorporated by reference herein. Section 2 - Financial Information Item 2.01 Completion of Acquisition or Disposition of Assets Pursuant to authorization of the Registrant's Board of Directors, the Registrant entered into a commitment on June 8, 2004 to sell to Staktek, Inc. all of DPAC's intellectual property related to stacking technology. Under the agreement, the Registrant was to also cease the sale and manufacture of LP memory-stacking products within 60 days after the closing date. Accordingly, the Registrant has completed the final production orders for memory stacking products and closed its manufacturing facility. The consideration received by the Registrant was $670,000 in cash. The Terms of Sale Agreement between DPAC Technologies Corp. and Staktek Group L.P. dated June 8, 2004 was filed by the Registrant on June 16, 2004 as Exhibit 10.14 to the Registrant's Form 8-K and is incorporated herein by this reference. The related press release is filed herewith as Exhibit 99.1 and is incorporated herein by reference. Item 2.05 Costs Associated with Exit or Disposal Activities As a result of the Registrant's closure of its manufacturing line for LP memory stacking, the Registrant expects to incur charges of approximately $588,000 for severance related expenses as the result of a reduction in personnel. The charges do not reflect the $670,000 received for the sale of the stacking patents. Section 5 - Corporate Governance and Management Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers. (b) On August 31, 2004, Registrant issued a press release announcing the departure of William M. Stowell as Chief Financial Officer of Registrant and the appointment of Stephen J. Vukadinovich as Chief Financial Officer of Registrant. As of August 31, 2004, William M. Stowell's employment as the Chief Financial Officer of the Registrant has terminated. Until that time, Mr. Stowell had served as the Registrant's principal accounting officer and principal financial officer. The related press release is filed herewith as Exhibit 99.1 and is incorporated herein by reference. (c) Mr. Vukadinovich will serve in the capacity as Chief Financial Officer and therefore as the Registrant's principal accounting officer and principal financial officer. The Registrant does not have a formal employment agreement with Mr. Vukadinovich, although the Registrant pays him a salary at a rate of $135,000 per year. Mr. Vukadinovich receives employment benefits and is subject to employment policies applicable to regular full-time exempt employees of the Registrant. Such employment is terminable at any time by either party without notice and without penalty. Mr. Vukadinovich had served as Registrant's Controller since May 8, 2000. Prior to joining DPAC, Mr. Vukadinovich was Controller with EPS Solutions Corp., a company engaged in providing cost recovery services. The related press release is filed herewith as Exhibit 99.1 and is incorporated herein by reference. Section 9 Financial Statements and Exhibits Item 9.01 - Financial Statements and Exhibits (c) Exhibits -------- 10.8 Employment Agreement dated June 7, 2001 between Registrant and William M. Stowell*(1) 10.8.1 Employment Agreement Amendment dated September 27, 2002 between Registrant and William M. Stowell.*(2) 10.14 Terms of Sales Agreement Between DPAC Technologies Corp. and Staktek Group L.P. 99.1 Press Release of Registrant dated September 1, 2004 - ---------------------------- (1) Incorporated by reference to Exhibit 10.11A to the Registrant's Quarterly Report on Form 10-Q filed July 13, 2001. (2) Incorporated by reference to the like-numbered exhibit to the Registrant's Annual Report on Form 10-K filed June 1, 2004. (3) Incorporated by reference to the like-numbered exhibit to the Registrant's Current Report on Form 8-K filed on June 16, 2004. 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. DPAC Technologies Corp. ------------------------------------------- (Registrant) Date: September 1, 2004 ------------------------------------------- /s/ Creighton K. Early ------------------------------------------- (Signature) Creighton K. Early, Chief Executive Officer ------------------------------------------- (Name and Title) EX-99.1 2 a4711778ex991.txt PRESS RELEASE EXHIBIT 99.1 DPAC Technologies Completes Closure of Previously Announced Sale of Memory Stacking Product Line GARDEN GROVE, Calif.--(BUSINESS WIRE)--Sept. 1, 2004--DPAC Technologies (NASDAQ:DPAC) -- DPAC focused exclusively on Airborne(TM) Wireless products -- Completes production of close-out orders for LP Stacking technology -- Reduces work force by 13, including CFO William M. Stowell -- Steve Vukadinovich, DPAC's Controller for the past four years, is appointed CFO -- DPAC places excess manufacturing space up for sub-lease consideration as well as placing memory stacking equipment for sale DPAC Technologies (NASDAQ:DPAC) announced today that DPAC is now exclusively focused on its Airborne(TM) wireless connectivity business for OEMs. The intellectual property related to memory stacking was sold to Staktek, Inc. in June of this year. The company has been producing and shipping final close-out orders from its historical customers for these products as provided under the intellectual property sale agreement with Staktek related to DPAC's LP Memory Stacking product line. DPAC has now completed the final production orders. With the closure of the manufacturing operation, DPAC reduced its work force by 13 people. The reduction in force includes William Stowell, DPAC's Chief Financial Officer. Bill will be replaced as CFO by Steve Vukadinovich, DPAC's Controller for the past four years. "We thank Bill for seventeen years of dedicated and effective leadership to DPAC as the CFO and we wish him the very best of luck in his future endeavors," said Kim Early, DPAC's CEO. In connection with the closedown of its memory stacking operations, DPAC expects to incur a one-time charge totaling approximately $588,000 that will affect the results of operations for its second fiscal quarter ending August 31, 2004. The charges reflect costs for severance expense related to the reduction in personnel. This charge will be offset by the sale of the stacking patents to Staktek for $670,000. "The completion of this action marks a significant milestone in the transformation of DPAC from a shrinking provider of memory stacking services into a participant in the rapidly growing market for wireless communications for OEMs in the machine-to-machine world. Over the past twelve months we have wound up the stacking business, recruited a motivated and talented wireless team, developed a solid flow of OEM customers, and hopefully put ourselves in position to benefit from the potential of a large and fast growing market," said Early. "We will be focused on supporting our customers in the completion of their designs, transitioning those customers to production volumes and demonstrating our ability to build a growing profitable business for our shareholders." About DPAC Technologies Located in Garden Grove, California, DPAC Technologies provides embedded wireless networking and connectivity products for machine-to-machine communication applications. DPAC's wireless products are used by major OEMs in the transportation, instrumentation and industrial control, homeland security, medical diagnostics and logistics markets to provide remote data collection and control. The Company's web site address is http://www.dpactech.com. Forward-Looking Statements This press release includes forward-looking statements, including statements regarding technology development and business plans, all of which are subject to material change, uncertainties and risks. Every statement herein that is not historic in nature is a forward-looking statement for purposes of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties, and therefore actual results may differ materially from those set forth in or underlying these statements. Factors that may materially affect DPAC's business include, but are not limited to, competition from similar technologies and products, rapid changes in competing technology standards, the uncertainties related to obtaining patents pursuant to our current and future patent applications, challenges in identifying and capitalizing on business opportunities, difficulties protecting technology or proprietary rights, risks of litigation, risks related to potential de-listing from the Nasdaq Small Cap Market, and risks and uncertainties due to general market and economic conditions. Please refer to the additional information about the risks and challenges faced by DPAC Technologies Corp. as contained in the Securities and Exchange Commission filings made by the DPAC Technologies Corp. on Form 10-K, 10-Q and 8-K. DPAC Technologies Corp. specifically disclaims any obligation to update or revise any forward-looking statements whether as a result of new information, future developments or otherwise. CONTACT: DPAC Technologies Kim Early, 714-898-0007 Kim.Early@dpactech.com or Steve Vukadinovich, 714-898-0007 Stephen.vukadinovich@dpactech.com www.dpactech.com -----END PRIVACY-ENHANCED MESSAGE-----