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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) November 23, 2005
GP Strategies Corporation
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(Exact Name of Registrant as Specified in Its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
1-7234 13-1926739
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(Commission File Number) (IRS Employer Identification No.)
777 Westchester Avenue, White Plains, NY 10604
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(Address of Principal Executive Offices) (Zip Code)
(914) 249-9700
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(Registrant's Telephone Number, Including Area Code)
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(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 40.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
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On November 23, 2005, GP Strategies Corporation (the "Company") entered
into a stipulation of settlement among the Company, the Company's wholly-owned
subsidiary, General Physics Corporation, and Electronic Data Systems
Corporation, as successor to the Systemhouse subsidiaries of MCI Communications
Corporation ("EDS"), to settle the Company's remaining claims against EDS
arising out of the Company's 1998 acquisition of Learning Technologies. Pursuant
to the settlement, EDS will make a cash payment of $9 million to the Company by
December 14, 2005 and the parties will exchange general releases.
In connection with the spin-off of National Patent Development
Corporation by the Company, which occurred on November 24, 2004, the Company
agreed to make an additional capital contribution to National Patent Development
in an amount equal to the first $5 million of any proceeds (net of litigation
expenses and taxes incurred, if any), and 50% of any proceeds (net of litigation
expenses and taxes incurred, if any) in excess of $15 million, received with
respect to the foregoing litigation claims and a related arbitration claim.
After payment of legal fees related to the litigation, the proceeds
received by the Company from the settlement will be approximately $7 million.
The Company had previously incurred approximately $1 million of expenses with
respect to the litigation and will incur approximately $2.4 million of taxes
relating to the receipt of the litigation proceeds, so the net proceeds with
respect to the litigation claim for purposes of the agreement with National
Patent Development are approximately $3.6 million. The net proceeds with respect
to the related arbitration award for purposes of the agreement with National
Patent Development were approximately $13.9 million, for total net proceeds of
approximately $17.5 million.
Pursuant to the agreement with National Patent Development, the Company
made a $5 million additional capital contribution to National Patent Development
out of the proceeds of the arbitration award and will make an additional capital
contribution of approximately $1.25 million to National Patent Development out
of the proceeds of the litigation settlement.
A copy of the press release issued by the Company with respect to the
settlement is attached hereto as Exhibit 99.1 and is incorporated herein by
reference.
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Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
See Item 1.01.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
99.1 Press release of GP Strategies Corporation dated November
29, 2005
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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.
GP Strategies Corporation
Date: November 30, 2005 Andrea D. Kantor
Executive Vice President and
and General Counsel
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EXHIBIT INDEX
Exhibit No. Description
99.1 Press release of GP Strategies Corporation dated November 29, 2005
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