8-K

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): June 2, 2008

ZAREBA SYSTEMS, INC.

(Exact Name of Registrant as Specified in its Charter)

Minnesota
(State or Other Jurisdiction of Incorporation)

0-1388
(Commission File Number) 41-0832194
(IRS Employer
Identification No.)

13705 26th Ave. N., Suite 102
Minneapolis, Minnesota 55441
(Address of Principal Executive Offices) (Zip Code)

(763) 551-1125
(Registrant’s Telephone Number, Including Area Code)

N/A
(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:

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))

TABLE OF CONTENTS

EX-99.1

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

Item 3.01(b)

On June 3, 2008, Zareba Systems, Inc. (the “Company”) issued a press release announcing that Dale A. Nordquist, a director of the Company, was appointed as the Company’s President and Chief Executive Officer and that Jerry W. Grabowski resigned as the Company’s President and Chief Executive Officer and from the Company’s Board of Directors. The Company provided this press release to Nasdaq. In connection with Mr. Nordquist’s appointment as President and Chief Executive Officer, he will continue to serve as a director, but he will resign from the Company’s Audit Committee, Compensation Committee and Nominating Committee. As a result of his appointment as an executive officer of the Company and his resignation from the Audit Committee, the Company will no longer meet the independent director requirements for continued listing on the Nasdaq Capital Market under Marketplace Rule 4350. Rule 4350 requires the Company to maintain a majority of independent directors on its Board of Directors and an Audit Committee of three independent directors. The Company will promptly commence a search to select an additional independent director who is also qualified to serve on the Audit Committee. The full text of the press release is set forth in Exhibit 99.1 attached hereto and is incorporated in this Report as if fully set forth herein.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Items 5.02(b), (c) and (e)

Appointment of Dale A. Nordquist as President and Chief Executive Officer

On June 2, 2008, the Board of Directors of the Company approved the appointment of Dale A. Nordquist to serve as the Company’s President and Chief Executive Officer. It is expected that Mr. Nordquist, 53, will assume this position on or before July 1, 2008. Mr. Nordquist has been a director of the Company since 2004 and will continue to serve in such capacity, but he will resign from the Company’s Audit Committee, Compensation Committee and Nominating Committee. Information required by Items 401(b), (d), (e) and Item 404(a) of Regulation S-K with respect to Mr. Nordquist’s business experience and other matters is set forth in Item 10 of Part III under the caption “Directors” and in Item 13 of Part III, each of the Company’s Annual Report on Form 10-K for its fiscal year ended September 30, 2007, which information is incorporated herein by reference.

In connection with this appointment, the Company entered into an employment agreement with Mr. Nordquist. Under the employment agreement, Mr. Nordquist will serve as an at will employee until his employment is terminated in accordance with the terms of the agreement or he resigns. The Company will pay Mr. Nordquist an initial annual base salary of $190,000, and Mr. Nordquist will be eligible to participate in any Company executive management incentive programs approved by the Board from time to time, with the maximum payout in any year to be 50% of his then current annual base salary. For the Company’s fiscal year ending June 30, 2009, Mr. Nordquist shall be entitled to a minimum incentive compensation award of $20,000. Mr. Nordquist will be also entitled to participate in all employee benefit plans of the Company. From time to time, the Board may grant to Mr. Nordquist stock options, restricted stock or other

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equity-based awards. Pursuant to the employment agreement, the Company granted Mr. Nordquist an initial option to purchase 40,000 shares of common stock, which grant will vest in four equal increments on each of the first four anniversaries of the date of grant, subject to the terms of the Company’s equity compensation plan and a stock option agreement entered into between the Company and Mr. Nordquist. If the Company terminates Mr. Nordquist’s employment without cause, he will continue to receive his base salary for a period of 12 months following termination, subject to a lump sum payment if the termination occurs before December 31, 2008 and subject to a capped amount based upon provisions of the Internal Revenue Code if the termination occurs after December 31, 2008. Mr. Nordquist has agreed to a covenant not to compete and a non-solicitation covenant following termination of the agreement.

Resignation of Jerry W. Grabowski

On June 2, 2008, Jerry W. Grabowski resigned as the Company’s President and Chief Executive Officer and from the Company’s Board of Directors. In connection with this resignation, the Company and Mr. Grabowski entered into a Resignation Agreement and Release (the “Resignation Agreement”). Pursuant to the Resignation Agreement, and in full satisfaction of the Company’s obligations under its Employment Agreement with Mr. Grabowski dated July 1, 1995 (the “Employment Agreement”), the Company has agreed to pay to or on behalf of Mr. Grabowski (i) his base salary in effect on June 2, 2008 over the course of one year in 26 installments, (ii) the costs of all existing health/medical and other benefit plans in which Mr. Grabowski was a participant on June 2, 2008, or provide substantially the same benefits, for a period of 12 months, (iii) his accrued but unused vacation as of June 2, 2008, and (iv) continued automobile lease payments and insurance through the end of the current lease term, but in no event after December 31, 2008. The parties agreed that Mr. Grabowski would not receive any incentive compensation for fiscal 2008. The payments to Mr. Grabowski represent substantially the same amounts that would have otherwise been payable to Mr. Grabowski under the Employment Agreement in the event of his termination by the Company. The Resignation Agreement also includes a release by Mr. Grabowski of any claims that he may have against the Company. Mr. Grabowski is entitled by law to rescind the Resignation Agreement at any time within 15 days of June 2, 2008.

The full text of the press release announcing the appointment of Mr. Nordquist and the resignation of Mr. Grabowski is set forth in Exhibit 99.1 attached hereto and incorporated in this Report as if fully set forth herein.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits.

99.1 Press Release dated June 2, 2008.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: June 5, 2008
	ZAREBA SYSTEMS, INC.
	By:
		Jeffrey S. Mathiesen, Vice President and
		Chief Financial Officer

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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

EXHIBIT INDEX
to
FORM 8-K

ZAREBA SYSTEMS, INC.

Date of Report:	Commission File No.:
June 2, 2008	0-1388

Exhibit No.	Item
99.1	Press Release dated June 2, 2008.

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EX-99.1

Exhibit 99.1

NEWS RELEASE

 June 3, 2008 FOR IMMEDIATE RELEASE

ZAREBA SYSTEMS ANNOUNCES APPOINTMENT OF NEW CHIEF EXECUTIVE OFFICER

Minneapolis — Zareba Systems, Inc. (NASDAQ:ZRBA) today announced that its board of directors appointed Dale A. Nordquist to serve as the Company’s President and Chief Executive Officer. Mr. Nordquist will transition out of his current position as Senior Vice President of Sales and Marketing of Winland Electronics, Inc. It is expected he will assume his position at the Company on or before July 1, 2008. Mr. Nordquist, who has been a member of the Company’s board of directors since 2004, succeeds Jerry Grabowski, who has served as the Company’s President and Chief Executive Officer since 1993. Mr. Grabowski resigned as President and Chief Executive Officer and from the Company’s board of directors effective June 2, 2008. In the interim, William J. Frederick, the Company’s Executive Vice President, Sales and Business Development, will oversee the management of the Company’s business.

Mr. Nordquist, 53, has held his current position at Winland Electronics, a provider of design, engineering and electronic manufacturing services to original equipment manufacturing (OEM) companies, since December 2002. From October 2001 to December 2002, he was the Vice President of Sales for Winland Electronics. From May 1999 to October 2001, Mr. Nordquist served as Vice President of Sales and Marketing for Quickdraw Conveyor Systems, Inc. From 1981 to May 1999, he served as Vice President of Sales and Marketing for HEI, Inc., a Minnesota-based designer and manufacturer of ultra-miniature electronic devices and high technology products incorporating these devices.

William R. Franta, chairman of the Company’s board of directors stated, “We thank Jerry for his efforts over the past years.” Mr. Franta added, “The board of Zareba Systems is committed to making the adjustments necessary to achieve growth and profitability. We believe Dale has the skills and is the right person to lead Zareba Systems at this crucial juncture.”

In connection with Mr. Nordquist’s appointment as President and Chief Executive Officer, he will continue to serve as a director, but he will resign from the audit committee, compensation committee and nominating committee of the Company’s board of directors. As a result of his appointment as an executive officer of the Company, and his resignation from the audit committee, the Company will no longer meet the independent director requirements for continued listing on the Nasdaq Capital Market under Marketplace Rule 4350. Rule 4350 requires the Company to maintain a majority of independent directors on its board of directors and an audit committee of three independent directors. The Company will promptly commence a search to select an additional independent director who is also qualified to serve on the audit committee. The Company expects to submit a plan and timetable to Nasdaq outlining how it intends to achieve compliance with the rules within fifteen days of notice from Nasdaq regarding the Company’s non-compliance.

About Zareba Systems, Inc.

Zareba Systems, Inc., a Minnesota corporation, is the world’s leading manufacturer of electronic perimeter fence and security systems for animal and access control. The Company’s corporate headquarters is located in Minneapolis, with manufacturing facilities in Ellendale, Minn. Its Zareba Systems Europe subsidiary owns Rutland Electric Fencing Co., the largest manufacturer of electric fencing products in the United Kingdom. The corporate web site is located at www.ZarebaSystemsInc.com.

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NEWS RELEASE

This release includes certain “forward-looking statements” as defined under Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those stated in such statements. Such risks and uncertainties include the timing of the transition of Mr. Nordquist’s duties at his current employer and commencement of his employment with the Company, our ability to identify a qualified director candidate to join the board of directors and audit committee in order to maintain compliance with the Nasdaq listing requirements, and our ability to successfully explore growth opportunities and achieve profitability. Certain of these factors are described in more detail in our reports filed with the Securities and Exchange Commission.

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Contact:
Jeff Mathiesen
763-551-1125