Current Report — Form 8-K Filing Table of Contents
Document/ExhibitDescriptionPagesSize 1: 8-K Acquisition of Fastech HTML 19K
3: EX-1.01 Letter of Intent, by and Between Prescient Applied HTML 19K
Intelligence, Inc. and Fastech
Integrated Solutions, LLC, Dated May 8,
2: EX-99.01 Press Release, Dated May 8, 2007 HTML 11K
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Information to be included in the report
Item 1.01. Entry into a Material Definitive Agreement
On May 8, 2007, Prescient Applied Intelligence, Inc. (the "Registrant") and Fastech Integrated Solutions, LLC ("Fastech") entered into a letter of intent ("LOI") for the purchase by Registrant of all of the assets of Fastech (the "Asset Purchase"). Under the terms of the LOI, the Registrant will issue to Fastech that number of shares of common stock of the Registrant so that Fastech will own 35% of the currently issued and outstanding common stock of the Registrant after the Asset Purchase, and 35% of a newly issued series of preferred stock ("New Preferred"). In connection with the issuance of the New Preferred, the
Registrant's currently issued and outstanding shares of preferred stock are proposed to be restructured into the New Preferred. As a result, upon consummation of the Asset Purchase, Fastech will own approximately 35% of the Registrant's equity securities, on a fully diluted basis. The transaction is subject to, among other things, the receipt of a fairness opinion regarding the terms and conditions set forth in the LOI, and customary closing conditions.
The LOI requires the payment to Fastech of a nonrefundable cash fee of $200,000 in the event the Registrant fails to proceed in good faith and with due diligence to negotiate a definitive asset purchase agreement upon substantially the terms and conditions set forth in the LOI.
On August 4, 2006,
the Registrant entered into a services agreement with Fastech for hardware relocation/migration services and on demand hosting services. The services agreement remains in effect for a period of 36 months and renews each term for a consecutive 36-month period until terminated by either party. Under the terms of the services agreement, Fastech is paid approximately $40,000 per month. $76,160 was paid to Fastech under the terms of the services agreement during 2006. Jane Hoffer, the President and Chief Executive Officer of the Registrant, is a member of the Board of Directors of Fastech. In addition, Michael DiPiano, a director of the Registrant,
is affiliated with NewSpring Mezzanine Capital ("NewSpring"). NewSpring is the holder of a promissory note of Fastech in the amount of approximately $2.25 million (the "NewSpring Note"). The LOI requires that the Newspring Note be restructured prior to closing of the Asset Purchase.