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 21, 2006
KEY TECHNOLOGY, INC.
(Exact name of registrant as specified in its charter)
OREGON 0-21820 93-0822509
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
150 Avery Street
Walla Walla, Washington 99362
(Address of principal executive offices) (Zip Code)
(509) 529-2161
(Registrant's telephone number, including area code)
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 2.05 Costs Associated with Exit or Disposal Activities
On September 21, 2006, the Company announced that, as part of the Company's
plan to maximize its resources and achieve greater overall cost-effectiveness,
the Freshline Machines manufacturing and engineering operations in Sydney,
Australia will be closed effective September 30, 2006 and integrated into
existing operations in Walla Walla, Washington. The Company will maintain its
sales and service offices in Sydney and Melbourne, Australia for the full line
of the Company's products in that market.
The Company estimates that the total costs incurred in association with the
closing of the Freshline Machines business will be approximately $275,000, with
severance and other employee-related costs comprising approximately $44,000 and
non-employee exit costs accounting for approximately $231,000. The charge that
will result in future cash expenditures is estimated to be $86,000.
In addition, the Company's engineering facilities at Medford, Oregon will
be consolidated into the Company's facilities in Walla Walla, Washington. The
move will begin immediately and is expected to be completed early in 2007. A
small number of aftermarket and service personnel will remain in Medford,
Oregon.
The Company estimates that the total costs incurred in association with the
consolidation of the Medford facilities will be approximately $500,000, all of
which the Company estimates will be severance and employee related. The Company
estimates future cash expenditures to be approximately $433,000.
The press release announcing the above actions is attached as an exhibit to
this Current Report on Form 8-K and is incorporated herein by reference.
Item 8.01 Other Events
The Company has agreed in principle to sell its 50% interest in InspX LLC
("InspX"), a jointly owned manufacturer of x-ray inspection systems formed in
2004, to that entity. Under the terms of the agreement, Key will receive $1.5
million in a combination of cash and secured notes, plus rights to a contingent
payment based upon future performance of the business. The transaction, expected
to close early in the first quarter of fiscal 2007, is expected to result in a
nominal gain that will not materially impact fiscal 2007 results.
The press release announcing the InspX transaction is attached as an
exhibit to this Current Report on Form 8-K and is incorporated herein by
reference.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
The following exhibit is furnished with this Current Report on Form 8-K:
Exhibit No. Description
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99.1 Press Release dated September 21, 2006 titled
"Key Technology Announces Cost Reduction Measures"
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 thereunto duly authorized.
KEY TECHNOLOGY, INC.
By: Ronald W. Burgess
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Ronald W. Burgess
Senior Vice President and Chief Financial Officer
Dated: September 21, 2006
EXHIBIT INDEX
Exhibit No. Description
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99.1 Press Release dated September 21, 2006 titled
"Key Technology Announces Cost Reduction Measures"