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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">UNITED STATES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Washington, D.C. 20549</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FORM 8-K</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>CURRENT REPORT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>PURSUANT TO SECTION 13 OR 15(d) OF </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>THE SECURITIES EXCHANGE ACT OF 1934</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Date of Report (Date of earliest event reported): <U>August
30, 2012 </U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>LAZARE KAPLAN INTERNATIONAL INC.</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Exact name of registrant as specified in
its charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 35%; border-bottom: windowtext 1pt solid; padding-left: 0.36in; text-align: left; text-indent: -0.36in">Delaware</TD>
    <TD STYLE="width: 30%; border-bottom: windowtext 1pt solid; text-align: center">1-7848</TD>
    <TD STYLE="width: 35%; border-bottom: windowtext 1pt solid; text-align: right">13-2728690</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>(State or other jurisdiction of</TD>
    <TD STYLE="text-align: center">(Commission</TD>
    <TD STYLE="text-align: right">(IRS Employer</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>incorporation or organization)</TD>
    <TD STYLE="text-align: center">File Number)</TD>
    <TD STYLE="text-align: right">Identification No.)</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 85%; border-bottom: windowtext 1pt solid">19 West 44<SUP>th</SUP> Street, New York, New York </TD>
    <TD STYLE="width: 15%; border-bottom: windowtext 1pt solid; text-align: right">10036</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: left; padding-left: 0.48in; text-indent: -0.48in">(Address of principal executive offices)</TD>
    <TD STYLE="text-align: right">(Zip Code)</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD NOWRAP STYLE="width: 34%">Registrant's telephone number, including area code</TD>
    <TD NOWRAP STYLE="width: 20%; border-bottom: windowtext 1pt solid; text-align: center">(212) 972-9700</TD>
    <TD NOWRAP STYLE="width: 46%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; border-bottom: windowtext 1pt solid; text-align: center; text-indent: 0in; text-decoration: none">Not Applicable</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(Former name, former address and former fiscal year, if changed since last report)</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Check the appropriate box below if the Form 8&minus;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):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Wingdings">&uml;</FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Wingdings">&uml;</FONT><FONT STYLE="font-family: Times New Roman, Times, Serif">
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Wingdings">&uml;</FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Wingdings">&uml;</FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

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<TD STYLE="width: 0in"></TD><TD STYLE="width: 1in; text-align: left"><B>Item 2.02</B></TD><TD STYLE="text-align: justify"><B>Results of Operations and Financial Condition.</B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The information set
forth under &ldquo;Results of Operations&rdquo; in Item 8.01 in this Form 8-K is incorporated herein by reference.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

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<TD STYLE="width: 0in"></TD><TD STYLE="width: 1in; text-align: left"><B>Item 8.01</B></TD><TD STYLE="text-align: justify"><B>Other Events.</B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Notification of Late Filing</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On August 30, 2012,
Lazare Kaplan International Inc. (the &ldquo;Company&rdquo;) filed with the Securities and Exchange Commission a Notification of
Late Filing on Form 12b-25 pertaining to its Annual Report on Form 10-K for the fiscal year ended May 31, 2012 (&ldquo;2012 Fiscal
Year&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">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&rsquo;s potential obligations under certain lines of credit and a guaranty (all of which, the &ldquo;Material
Uncertainties&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Accordingly, the Company
is currently unable to finalize its financial statements for the 2012 Fiscal Year or file its Form 10-K for that period. Additionally,
the Company remains unable to finalize its financial statements or file the corresponding (i) Form 10-K for each of its fiscal
years ended May 31, 2009, 2010 or 2011, and (ii) Form 10-Q for each of its fiscal quarters ended February 29, 2012, November 30,
2011, August 31, 2011, February 28, 2011, November 30, 2010, August 31, 2010, February 28, 2010, November 30, 2009 or August 31,
2009.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company intends
to as promptly as practicable finalize and file its Forms 10-K and Forms 10-Q for the periods referenced above with the Securities
and Exchange Commission, upon the earlier to occur of (a) the successful resolution of the remaining aspects of the Material Uncertainties
or (b) the Company concluding (together with its Independent Public Accountants) that the remaining Material Uncertainties have
been resolved to such an extent that it can finalize its financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Please refer to the
Forms 8-K filed by the Company on September 1, 2009, September 16, 2009, October 21, 2009, January 15, 2010, April 14, 2010, August
31, 2010, October 15, 2010, January 14, 2011, April 14, 2011, and July 6, 2011, August 30, 2011, October 18, 2011, December 29,
2011,  January 18, 2012 and April 16, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In an effort to resolve the Material Uncertainties,
the Company, among other things:</P>

<P STYLE="font: 10pt Symbol; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">entered into discussions with various
financial institutions related to these matters regarding resolution of the Company&rsquo;s potential claims and repayment of amounts
which were asserted as being owed by the Company to these institutions;</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Symbol; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">filed claims for indemnification under
two sets of &ldquo;All Risks&rdquo; insurance policies, one governed by the laws of the United States of America and the other
by the laws of the United Kingdom (respectively, the &ldquo;U.S. Polices&rdquo; and the &ldquo;U.K. Policies&rdquo;).</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

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<P STYLE="font: 10pt Symbol; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">pursued recovery of its assets through
a series of actions, including litigation in the courts of Belgium, the United Kingdom and the United States of America.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In furtherance of the
foregoing, the Company has taken the following steps and the following events have occurred.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><U>Insurance</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Effective December
2009, the Company entered into an interim payment agreement with the underwriters of the U.S. Policies (the &ldquo;U.S. Underwriters&rdquo;),
pursuant to which the Company received a non-refundable payment of $28 million (the &ldquo;Interim Payment&rdquo;), and the U.S.
Underwriters agreed to reimburse certain costs incurred by the Company in connection with the investigation of its claims. In addition,
the U.S. Underwriters agreed to provide the Company with a coverage opinion regarding all claims made under the U.S. Policies by
May 3, 2010.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On April 30, 2010 and
May 3, 2010, the underwriters of the U.K. Policies (the &ldquo;U.K. Underwriters&rdquo;) and the U.S. Underwriters, respectively,
notified the Company that they were denying coverage of the Company&rsquo;s claims. The U.K. Underwriters further advised the Company
that they had initiated litigation in the courts of England for a declaratory judgment confirming that the Company&rsquo;s losses
were not covered under the U.K. Policies. The Company answered by asserting various counter claims and asking that coverage for
the Company&rsquo;s claimed losses be confirmed by the court.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On May 17, 2010, the
Company filed suit in the Federal District Court of New York asserting claims for, among other things, the non-payment of covered
losses under the U.S. Policies, unpaid sue and labor costs and consequential damages.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On July 1, 2011, the
Company and certain of its affiliates entered into a U.S. Release and Settlement Agreement with the U.S. Underwriters (the &ldquo;U.S.
Settlement Agreement&rdquo;), and a U.K. Release and Settlement Agreement with the U.K. Underwriters (the &ldquo;U.K. Settlement
Agreement&rdquo; and, with the U.S. Settlement Agreement, the &ldquo;Release and Settlement Agreements&rdquo;). Pursuant to the
Release and Settlement Agreements, the Company was paid a total of $32,000,000. Furthermore, in the context of the Release and
Settlement Agreements, the parties dismissed all pending litigation and executed mutual releases. The Company retained all of its
rights to pursue recovery of its assets against third parties.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><U>Settlement With Certain Financial Institutions</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On October 26, 2010,
the Company and its affiliates, Lazare Kaplan Japan Inc. (&ldquo;LK Japan&rdquo;), Lazare Kaplan Europe Inc. (&ldquo;LK Europe&rdquo;)
and Lazare Kaplan Africa Inc. (&ldquo;LK Africa&rdquo; and, collectively with LK Japan and LK Europe, the &ldquo;Affiliates&rdquo;)
entered into a Settlement Agreement (the &ldquo;2010 Settlement Agreement&rdquo;) with ABN AMRO Bank N.V. (&ldquo;ABN&rdquo;) and
The Royal Bank of Scotland PLC (&ldquo;RBS&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant to the 2010
Settlement Agreement:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

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<P STYLE="font: 10pt Symbol; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">Obligations of the Company and/or its
Affiliates totaling approximately $64 million were deemed by ABN and RBS to be satisfied in full. The &ldquo;Obligations&rdquo;
consisted of:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(a)</TD><TD STYLE="text-align: justify">asserted unpaid principal, interest and expenses under the Facility Letter dated as of February
27, 2009 (the &ldquo;Facility Letter&rdquo;) and the Amended and Restated Credit Agreement dated as of February 27, 2009 (the &ldquo;ABN
Credit Agreement&rdquo;), each between the Company and ABN;</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(b)</TD><TD STYLE="text-align: justify">two guaranties, each dated February 27, 2009, pursuant to which the Affiliates guaranteed the obligations
of the Company to ABN under the Facility Letter and the ABN Credit Agreement;</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(c)</TD><TD STYLE="text-align: justify">asserted unpaid principal, interest and expenses under the Amended and Restated Credit Facility
Agreement dated as of February 28, 2009 between LK Japan and RBS (the &ldquo;Japan Credit Agreement&rdquo;);</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(d)</TD><TD STYLE="text-align: justify">a guarantee dated April 13, 2009, pursuant to which the Company guaranteed the obligations of LK
Japan to RBS under the Japan Credit Agreement; and</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(e)</TD><TD STYLE="text-align: justify">a guaranty dated September 1, 2007 pursuant to which the Company guaranteed up to fifty percent
of certain obligations of Gulfdiam DMCC, an affiliate of the Company, to ABN.</TD></TR></TABLE>

<P STYLE="font: 10pt Symbol; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">ABN agreed to transfer to the Company
all of ABN&rsquo;s legal and equitable right, title and interest in and to an aggregate of 2,151,103 shares of the Company&rsquo;s
common stock.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Symbol; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">ABN assigned to the Company ABN&rsquo;s
right, title and interest under the U.K. Policies, as well as ABN&rsquo;s right, title and interest to receive proceeds paid or
payable under the U.K. Policies. ABN&rsquo;s assignment to the Company of such right, title and interest included ABN&rsquo;s right,
title and interest in any amounts that the Company received with respect to any settlement reached or judgment rendered in certain
lawsuits.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Symbol; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">ABN and RBS each released the Company
and the Affiliates from any and all of the Obligations and claims relating thereto. In return, the Company and the Affiliates each
released ABN and RBS from certain claims asserted by the Company relating to the Obligations as well as other claims asserted by
the Company relating to its relationship and business dealings with each of ABN and RBS.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Symbol; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">The Company paid to ABN and RBS, collectively,
$14 million.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><U>Litigation with KBC Bank N.V. and Antwerp
Diamond Bank N.V.</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On February 19, 2008,
Lazare Kaplan Belgium N.V., a subsidiary of the Company (the &ldquo;Subsidiary&rdquo;), and Antwerp Diamond Bank N.V. (&ldquo;ADB&rdquo;)
entered into a Credit Confirmation Letter (the &ldquo;Credit Letter&rdquo;), pursuant to which ADB granted to the Subsidiary an
uncommitted US$25 million credit facility (the &ldquo;$25M Facility&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On February 20, 2008,
the Company and ADB entered into a Credit Confirmation Agreement (the &ldquo;Credit Agreement&rdquo;), pursuant to which ADB granted
to the Company an unsecured, uncommitted US$45 million New York credit facility (the &ldquo;$45M Facility&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Commencing in early
2009, the Company entered into discussions with the Executive Committee and senior management of ADB concerning, among other matters,
its knowledge with respect to the loss or theft of the Company&rsquo;s assets and the possible obligations of ADB to the Company
and the Subsidiary resulting from its actions and the actions of certain of its senior personnel.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On December 29, 2009,
ADB delivered a notice to the Subsidiary, stating that under the terms of the Credit Letter, it was terminating the $25M Facility
as of January 28, 2010. There were no amounts outstanding under the $25M Facility at the time of termination.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On December 30, 2009,
ADB delivered a notice to the Company, stating that under the terms of the Credit Agreement, it was terminating the $45M Facility
on March 1, 2010. Pursuant to such notice, ADB claimed that the balance allegedly outstanding under the $45M Facility plus accrued
and unpaid interest, costs, charges and fees (including attorneys&rsquo; fees) would be due and payable on such termination date.
At the time of termination approximately $43 million was alleged by ADB to be outstanding under the $45M Facility.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In early 2010 the Company
contacted executive management of KBC Bank N.V. (&ldquo;KBC&rdquo;), the parent company of ADB, concerning the loss or theft of
the assets of the Company and the Subsidiary and the Company&rsquo;s understanding of the potential involvement of ADB and senior
members of ADB&rsquo;s management with respect thereto.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In March 2010, ADB
commenced litigation against the Company in the Antwerp Court of Commerce seeking payment of amounts alleged to be due and owing
under the $45M Facility.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company denies
that any amounts are currently due or owing to ADB under the $45M Facility and further denies that any action under the $45M Facility
may be brought by ADB in the courts of Belgium. Belgian proceedings, originally scheduled to be heard on October 7, 2011 and rescheduled
for September 28, 2012, are currently scheduled, subject to final approval of the Belgian court, to begin on March 22, 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On December 23, 2011
the Company filed suit against ADB and KBC &ndash; under the Racketeer Influenced and Corrupt Organizations Act (&ldquo;RICO&rdquo;)
and state law. The Company is seeking, among other things, in excess of $500 million in damages that could be trebled under RICO.
The lawsuit alleges that the banks engaged in money laundering and other illegal activity that includes the theft of over $135
million from the sales of diamonds belonging to the Company and its affiliates. Both banks have offices in New York and conduct
licensed banking operations in the United States. The Company filed the RICO lawsuit against ADB and KBC in an effort to resolve
the remaining Material Uncertainties.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On April 6, 2012, KBC
and ADB filed motions to dismiss the Company&rsquo;s complaint. The Company has submitted papers in opposition to such motions.
The motions are fully briefed and the Company expects the Court to soon issue a decision on the motions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company believes
that the continued existence of this litigation and the remaining Material Uncertainties have a significant detrimental effect
on the Company&rsquo;s ability to transact business in the ordinary course.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Other Matters:</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company was informed
of the death of Director Lucien Burstein, who passed away on August 12, 2012. Everyone at the Company extends heartfelt condolences
to his family. Mr. Burstein joined the Company&rsquo;s Board of Directors in 1984 and has served on the Audit and Compensation
Committees of the Board, as well as serving as the Company&rsquo;s Secretary. As a Senior Partner of Warshaw Burstein Cohen Schlesinger
&amp; Kuh, LLP, he served as corporate counsel to the Company for many years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company is grateful
for his leadership as he guided the Company, shaping a corporate culture of honesty and integrity. The Company is extremely fortunate
to have had his counsel and direction for so many years. All at the Company are saddened by his loss and our thoughts are with
his family and friends during this difficult time.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Results of Operations</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">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 the 2012 Fiscal Year, except as set forth below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company anticipates
that its reported results of operations for Fiscal 2012 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 the 2012
Fiscal Year, which is subject to the completion of the Company&rsquo;s audits for its fiscal years ended May 31, 2009, May 31,
2010, May 31, 2011, and May 31, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company anticipates
net sales of approximately $105.7 million for the 2012 Fiscal Year as compared to net sales of $137.8 million for the fiscal year
ended May 31, 2011. The decrease in net sales primarily reflects a decrease in rough trading volume.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Current uncertain economic
conditions continue to impact the sectors of the diamond and jewelry industry in which the Company operates. In addition, the continued
existence of its litigation with ADB and KBC and the inability of the Company to timely resolve the remainder 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Forward-Looking Statements</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">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&rsquo;s financial statements, the filing of the Company&rsquo;s Form 10-K
for the 2012 Fiscal Year and other annual and quarterly reports, and expectations regarding the Company&rsquo;s legal proceedings.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Statements that are
not historical facts, including statements about the Company&rsquo;s beliefs and expectations, are forward-looking statements.
These statements are based on beliefs and assumptions by the Company&rsquo;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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left; text-indent: 0.5in">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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3">LAZARE KAPLAN INTERNATIONAL INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48%">&nbsp;</TD>
    <TD STYLE="width: 4%">&nbsp;</TD>
    <TD STYLE="width: 4%">&nbsp;</TD>
    <TD STYLE="width: 44%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Date: August 30, 2012</TD>
    <TD>&nbsp;</TD>
    <TD>By:</TD>
    <TD STYLE="border-bottom: Black 1pt solid"> /s/ William H. Moryto</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">William H. Moryto,</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">Vice President and Chief Financial Officer</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>



<P STYLE="margin: 0"></P>

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{"company-data": {"conformed-name": "LAZARE KAPLAN INTERNATIONAL INC", "cik": "0000202375", "assigned-sic": "5094", "irs-number": "132728690", "state-of-incorporation": "DE", "fiscal-year-end": "0531"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-07848", "film-number": "121065251"}, "business-address": {"street1": "529 FIFTH AVE", "city": "NEW YORK", "state": "NY", "zip": "10017", "phone": "2129729700"}, "mail-address": {"street1": "529 FIFTH AVE", "street2": "529 FIFTH AVE", "city": "NEW YORK", "state": "NY", "zip": "10017"}}
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):
August
30, 2012
LAZARE KAPLAN INTERNATIONAL INC.
(Exact name of registrant as specified in
its charter)
Delaware
1-7848
13-2728690
(State or other jurisdiction of
(Commission
(IRS Employer
incorporation or organization)
File Number)
Identification No.)
19 West 44
th
Street, New York, New York
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):
¨
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 2.02
Results of Operations and Financial Condition.
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
Other Events.
Notification of Late Filing
On August 30, 2012,
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 Annual Report on Form 10-K for the fiscal year ended May 31, 2012 ("2012 Fiscal
Year").
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").
Accordingly, the Company
is currently unable to finalize its financial statements for the 2012 Fiscal Year or file its Form 10-K for that period. Additionally,
the Company remains unable to finalize its financial statements or file the corresponding (i) Form 10-K for each of its fiscal
years ended May 31, 2009, 2010 or 2011, and (ii) Form 10-Q for each of its fiscal quarters ended February 29, 2012, November 30,
2011, August 31, 2011, February 28, 2011, November 30, 2010, August 31, 2010, February 28, 2010, November 30, 2009 or August 31,
2009.
The Company intends
to as promptly as practicable finalize and file its Forms 10-K and Forms 10-Q for the periods referenced above with the Securities
and Exchange Commission, upon the earlier to occur of (a) the successful resolution of the remaining aspects of the Material Uncertainties
or (b) the Company concluding (together with its Independent Public Accountants) that the remaining Material Uncertainties have
been resolved to such an extent that it can finalize its financial statements.
Please refer to the
Forms 8-K filed by the Company on September 1, 2009, September 16, 2009, October 21, 2009, January 15, 2010, April 14, 2010, August
31, 2010, October 15, 2010, January 14, 2011, April 14, 2011, and July 6, 2011, August 30, 2011, October 18, 2011, December 29,
2011,  January 18, 2012 and April 16, 2012.
In an effort to resolve the Material Uncertainties,
the Company, among other things:
·
entered into discussions with various
financial institutions related to these matters regarding resolution of the Company's potential claims and repayment of amounts
which were asserted as being owed by the Company to these institutions;
·
filed claims for indemnification under
two sets of "All Risks" insurance policies, one governed by the laws of the United States of America and the other
by the laws of the United Kingdom (respectively, the "U.S. Polices" and the "U.K. Policies").
·
pursued recovery of its assets through
a series of actions, including litigation in the courts of Belgium, the United Kingdom and the United States of America.
In furtherance of the
foregoing, the Company has taken the following steps and the following events have occurred.
Insurance
Effective December
2009, the Company entered into an interim payment agreement with the underwriters of the U.S. Policies (the "U.S. Underwriters"),
pursuant to which the Company received a non-refundable payment of $28 million (the "Interim Payment"), and the U.S.
Underwriters agreed to reimburse certain costs incurred by the Company in connection with the investigation of its claims. In addition,
the U.S. Underwriters agreed to provide the Company with a coverage opinion regarding all claims made under the U.S. Policies by
May 3, 2010.
On April 30, 2010 and
May 3, 2010, the underwriters of the U.K. Policies (the "U.K. Underwriters") and the U.S. Underwriters, respectively,
notified the Company that they were denying coverage of the Company's claims. The U.K. Underwriters further advised the Company
that they had initiated litigation in the courts of England for a declaratory judgment confirming that the Company's losses
were not covered under the U.K. Policies. The Company answered by asserting various counter claims and asking that coverage for
the Company's claimed losses be confirmed by the court.
On May 17, 2010, the
Company filed suit in the Federal District Court of New York asserting claims for, among other things, the non-payment of covered
losses under the U.S. Policies, unpaid sue and labor costs and consequential damages.
On July 1, 2011, the
Company and certain of its affiliates entered into a U.S. Release and Settlement Agreement with the U.S. Underwriters (the "U.S.
Settlement Agreement"), and a U.K. Release and Settlement Agreement with the U.K. Underwriters (the "U.K. Settlement
Agreement" and, with the U.S. Settlement Agreement, the "Release and Settlement Agreements"). Pursuant to the
Release and Settlement Agreements, the Company was paid a total of $32,000,000. Furthermore, in the context of the Release and
Settlement Agreements, the parties dismissed all pending litigation and executed mutual releases. The Company retained all of its
rights to pursue recovery of its assets against third parties.
Settlement With Certain Financial Institutions
On October 26, 2010,
the Company and its affiliates, Lazare Kaplan Japan Inc. ("LK Japan"), Lazare Kaplan Europe Inc. ("LK Europe")
and Lazare Kaplan Africa Inc. ("LK Africa" and, collectively with LK Japan and LK Europe, the "Affiliates")
entered into a Settlement Agreement (the "2010 Settlement Agreement") with ABN AMRO Bank N.V. ("ABN") and
The Royal Bank of Scotland PLC ("RBS").
Pursuant to the 2010
Settlement Agreement:
·
Obligations of the Company and/or its
Affiliates totaling approximately $64 million were deemed by ABN and RBS to be satisfied in full. The "Obligations"
consisted of:
(a)
asserted unpaid principal, interest and expenses under the Facility Letter dated as of February
27, 2009 (the "Facility Letter") and the Amended and Restated Credit Agreement dated as of February 27, 2009 (the "ABN
Credit Agreement"), each between the Company and ABN;
(b)
two guaranties, each dated February 27, 2009, pursuant to which the Affiliates guaranteed the obligations
of the Company to ABN under the Facility Letter and the ABN Credit Agreement;
(c)
asserted unpaid principal, interest and expenses under the Amended and Restated Credit Facility
Agreement dated as of February 28, 2009 between LK Japan and RBS (the "Japan Credit Agreement");
(d)
a guarantee dated April 13, 2009, pursuant to which the Company guaranteed the obligations of LK
Japan to RBS under the Japan Credit Agreement; and
(e)
a guaranty dated September 1, 2007 pursuant to which the Company guaranteed up to fifty percent
of certain obligations of Gulfdiam DMCC, an affiliate of the Company, to ABN.
·
ABN agreed to transfer to the Company
all of ABN's legal and equitable right, title and interest in and to an aggregate of 2,151,103 shares of the Company's
common stock.
·
ABN assigned to the Company ABN's
right, title and interest under the U.K. Policies, as well as ABN's right, title and interest to receive proceeds paid or
payable under the U.K. Policies. ABN's assignment to the Company of such right, title and interest included ABN's right,
title and interest in any amounts that the Company received with respect to any settlement reached or judgment rendered in certain
lawsuits.
·
ABN and RBS each released the Company
and the Affiliates from any and all of the Obligations and claims relating thereto. In return, the Company and the Affiliates each
released ABN and RBS from certain claims asserted by the Company relating to the Obligations as well as other claims asserted by
the Company relating to its relationship and business dealings with each of ABN and RBS.
·
The Company paid to ABN and RBS, collectively,
$14 million.
Litigation with KBC Bank N.V. and Antwerp
Diamond Bank N.V.
On February 19, 2008,
Lazare Kaplan Belgium N.V., a subsidiary of the Company (the "Subsidiary"), and Antwerp Diamond Bank N.V. ("ADB")
entered into a Credit Confirmation Letter (the "Credit Letter"), pursuant to which ADB granted to the Subsidiary an
uncommitted US$25 million credit facility (the "$25M Facility").
On February 20, 2008,
the Company and ADB entered into a Credit Confirmation Agreement (the "Credit Agreement"), pursuant to which ADB granted
to the Company an unsecured, uncommitted US$45 million New York credit facility (the "$45M Facility").
Commencing in early
2009, the Company entered into discussions with the Executive Committee and senior management of ADB concerning, among other matters,
its knowledge with respect to the loss or theft of the Company's assets and the possible obligations of ADB to the Company
and the Subsidiary resulting from its actions and the actions of certain of its senior personnel.
On December 29, 2009,
ADB delivered a notice to the Subsidiary, stating that under the terms of the Credit Letter, it was terminating the $25M Facility
as of January 28, 2010. There were no amounts outstanding under the $25M Facility at the time of termination.
On December 30, 2009,
ADB delivered a notice to the Company, stating that under the terms of the Credit Agreement, it was terminating the $45M Facility
on March 1, 2010. Pursuant to such notice, ADB claimed that the balance allegedly outstanding under the $45M Facility plus accrued
and unpaid interest, costs, charges and fees (including attorneys' fees) would be due and payable on such termination date.
At the time of termination approximately $43 million was alleged by ADB to be outstanding under the $45M Facility.
In early 2010 the Company
contacted executive management of KBC Bank N.V. ("KBC"), the parent company of ADB, concerning the loss or theft of
the assets of the Company and the Subsidiary and the Company's understanding of the potential involvement of ADB and senior
members of ADB's management with respect thereto.
In March 2010, ADB
commenced litigation against the Company in the Antwerp Court of Commerce seeking payment of amounts alleged to be due and owing
under the $45M Facility.
The Company denies
that any amounts are currently due or owing to ADB under the $45M Facility and further denies that any action under the $45M Facility
may be brought by ADB in the courts of Belgium. Belgian proceedings, originally scheduled to be heard on October 7, 2011 and rescheduled
for September 28, 2012, are currently scheduled, subject to final approval of the Belgian court, to begin on March 22, 2013.
On December 23, 2011
the Company filed suit against ADB and KBC – under the Racketeer Influenced and Corrupt Organizations Act ("RICO")
and state law. The Company is seeking, among other things, in excess of $500 million in damages that could be trebled under RICO.
The lawsuit alleges that the banks engaged in money laundering and other illegal activity that includes the theft of over $135
million from the sales of diamonds belonging to the Company and its affiliates. Both banks have offices in New York and conduct
licensed banking operations in the United States. The Company filed the RICO lawsuit against ADB and KBC in an effort to resolve
the remaining Material Uncertainties.
On April 6, 2012, KBC
and ADB filed motions to dismiss the Company's complaint. The Company has submitted papers in opposition to such motions.
The motions are fully briefed and the Company expects the Court to soon issue a decision on the motions.
The Company believes
that the continued existence of this litigation and the remaining Material Uncertainties have a significant detrimental effect
on the Company's ability to transact business in the ordinary course.
Other Matters:
The Company was informed
of the death of Director Lucien Burstein, who passed away on August 12, 2012. Everyone at the Company extends heartfelt condolences
to his family. Mr. Burstein joined the Company's Board of Directors in 1984 and has served on the Audit and Compensation
Committees of the Board, as well as serving as the Company's Secretary. As a Senior Partner of Warshaw Burstein Cohen Schlesinger
& Kuh, LLP, he served as corporate counsel to the Company for many years.
The Company is grateful
for his leadership as he guided the Company, shaping a corporate culture of honesty and integrity. The Company is extremely fortunate
to have had his counsel and direction for so many years. All at the Company are saddened by his loss and our thoughts are with
his family and friends during this difficult time.
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 the 2012 Fiscal Year, except as set forth below.
The Company anticipates
that its reported results of operations for Fiscal 2012 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 the 2012
Fiscal Year, which is subject to the completion of the Company's audits for its fiscal years ended May 31, 2009, May 31,
2010, May 31, 2011, and May 31, 2012.
The Company anticipates
net sales of approximately $105.7 million for the 2012 Fiscal Year as compared to net sales of $137.8 million for the fiscal year
ended May 31, 2011. The decrease in net sales primarily reflects a decrease in rough trading volume.
Current uncertain economic
conditions continue to impact the sectors of the diamond and jewelry industry in which the Company operates. In addition, the continued
existence of its litigation with ADB and KBC and the inability of the Company to timely resolve the remainder 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.
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, the filing of the Company's Form 10-K
for the 2012 Fiscal Year and other annual and quarterly reports, and expectations regarding the Company's legal proceedings.
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.
Date: August 30, 2012
By:
/s/ William H. Moryto
William H. Moryto,
Vice President and Chief Financial Officer