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): January 14,
2011
LAZARE KAPLAN INTERNATIONAL
INC.
(Exact
name of registrant as specified in its charter)
Delaware
|
7848
|
13-2728690
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(State
or other jurisdiction of
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(Commission
|
(IRS
Employer
|
incorporation
or organization)
|
File
Number)
|
Identification
No.)
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19 West 44th Street, New York, New York
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10036
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Registrant's
telephone number, including area code (212)
972-9700
Not
Applicable
(Former
name, former address and former fiscal year, 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):
o Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
2.02
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Results
of Operations and Financial
Condition.
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The
information set forth under “Results of Operations” in Item 8.01 in this Form
8-K is incorporated herein by reference.
Item 8.01
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Other
Events.
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Notification of Late Filing
On
January 14, 2011, Lazare Kaplan International Inc. (the “Company”) filed with
the Securities and Exchange Commission a Notification of Late Filing on Form
12b-25 pertaining to its Quarterly Report on Form 10-Q for the quarter ended
November 30, 2010 (“Q2 2011”).
As stated
in the Form 12b-25, the Company has been unable to resolve a material
uncertainty concerning (a) the collectability and recovery of certain assets,
and (b) the Company’s potential obligations under certain lines of credit and a
guaranty (all of which, the “Material Uncertainties”).
As more
fully described in the Company’s filing on Form 8-K dated October 28,
2010, during Q2 2011, the Company and certain of its affiliates entered into a
Settlement Agreement with certain banks pursuant to which:
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·
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Obligations
(including certain guaranties) of the Company and/or the
affiliates totaling approximately $64 million were deemed
satisfied in full.
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·
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The
Company received 2,151,103 shares of its common stock held by one of the
banks.
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|
·
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The
Company was assigned one of the bank’s rights with respect to certain
amounts that may be receivable by such bank pursuant to certain insurance
policies previously obtained by the
Company.
|
|
·
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The
Company paid to the banks, collectively, $14
million.
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As a
result of the settlement, the Company resolved certain aspects of the Material
Uncertainties that have prevented the Company from finalizing its financial
statements. The Company is continuing to pursue final resolution of the
remaining Material Uncertainties, of which it can give no assurance of
success.
As the
Company is unable to assess the potential effect the ultimate resolution of the
remaining Material Uncertainties will have on the financial position and results
of operation of the Company, the Company remains unable to finalize its
financial statements for Q2 2011 or file its Form 10-Q
for that period. Additionally, the Company has
been unable to finalize its
audited financial statements for the fiscal
years ended May 31, 2009 and May 31, 2010, and
its financial statements for the fiscal quarters ended August 31, 2009,
November 30, 2009, February 28, 2010, and
August 31, 2010.
The
Company is aggressively working to resolve the remaining Material Uncertainties
and believes that once they are resolved, it will be in a position to finalize
its financial statements for each of the above referenced fiscal periods and
file all applicable Forms 10-K and Forms 10-Q with the Securities and Exchange
Commission.
Results
of Operations
As described above, at this time, the
Company is unable to resolve the remaining Material Uncertainties. As such, the
Company cannot report its results of operations for Q2 2011, except as set forth
below.
The Company anticipates that its
reported results of operations for Q2 2011 will reflect significant changes from
the corresponding period of the last fiscal year. However, the Company, at this
time, can only give a reasonable estimate of its anticipated net sales for Q2
2011, which is subject to the completion of the Company’s audits for its fiscal
year ended May 31, 2009 and fiscal year ending May 31, 2010.
The Company anticipates net sales for
the three and six months ended November 30, 2010 of approximately $28.9 million
and $62.0 million as compared to net sales of $23.0 million and $97.2
million,
respectively, for the
corresponding periods of the last fiscal year. The increase in net
sales for the three months ended November 30, 2010 reflects increases in both
polished diamond sales and rough diamond trading. The decrease in net sales for
the six months ended November 30, 2010 reflects increased sales of polished
diamonds offset by a decrease in rough trading volume.
Although there are continuing signs of
improving trends, current uncertain economic conditions continue to impact the
sectors of the diamond and jewelry industry in which the Company operates.
In addition, the inability
of the Company to timely resolve all of the Material Uncertainties has adversely
impacted the Company's ability to transact business in the ordinary course to
the same extent and in the same manner as it did previously. This includes,
without limitation, the ability of the Company to maintain and/or expand its
operations.
During Q2 2011, the Company
continued to focus its efforts on cash flow and cost reduction. Gross
margins remained under significant pressure as a result of price competition and
overhead absorption.
The Company is not, at this time, in a
position to give a reasonable estimate as to the Company’s gross margin and
income before income taxes, among other results of
operations.
Forward-Looking
Statements
The
information provided in this Form 8-K includes forward-looking statements,
including, without limitation, statements regarding financial information, the
estimated timing for the completion of the Company’s financial statements and
the filing of the Company’s Q2 2011 Form 10-Q
and other annual and quarterly reports.
Statements
that are not historical facts, including statements about the Company’s beliefs
and expectations, are forward-looking statements. These statements are based on
beliefs and assumptions by the Company’s management, and on information
currently available to management. Forward-looking statements speak only as of
the date they are made, and the Company undertakes no obligation to update any
of them publicly in light of new information or future events. A number of
important factors could cause actual result to differ materially from those
contained in any forward-looking statements.
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.
LAZARE
KAPLAN INTERNATIONAL INC.
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|||
Date:
January 14, 2011
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By:
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/s/ William H. Moryto, | |
William H. Moryto, | |||
Vice President and Chief Financial Officer |