Attached files
| file | filename |
|---|---|
| EX-10.2 - EXHIBIT 10.2 - PepperBall Technologies, Inc. | pball_8k-ex10x2.htm |
| EX-10.3 - EXHIBIT 10.3 - PepperBall Technologies, Inc. | pball_8k-ex10x3.htm |
| EX-10.1 - EXHIBIT 10.1 - PepperBall Technologies, Inc. | pball_8k-ex10x1.htm |
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): December 10, 2009
PepperBall
Technologies, Inc.
(Exact
name of registrant as specified in its charter)
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Colorado
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001-32566
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20-1978398
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(State
or other jurisdiction
of
incorporation)
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(Commission
File Number)
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(IRS
Employer
Identification
No.)
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6142
Nancy Ridge Drive, Suite 101
San
Diego, CA 92121
(Address
of principal executive offices) (Zip Code)
Registrant’s
telephone number, including area code: (858) 638-0236
None
(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:
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
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Item
1.01 Entry into a Material Definitive Agreement
On
December 10, 2009, PepperBall Technologies – CA, Inc., a Delaware corporation
(“PTI-CA”) and a wholly owned subsidiary of PepperBall Technologies, Inc., a
Colorado corporation (the “Company”), entered into an Eighth Amendment to Loan
Agreement (the “Amendment”) with Agility Capital, LLC
(“Agility”). The Amendment amends the Loan Agreement dated November
18, 2005, as previously amended on April 12, 2006, September 8, 2006, April 20,
2007, October 19, 2007, April 25, 2008, November 26, 2008 and December 12, 2008
(the “Loan Agreement”).
Pursuant
to the Amendment, PTI-CA may immediately request advances under the Loan
Agreement of up to $160,000 (bringing the total amount outstanding under the
Loan Agreement to $250,000). In addition, upon the closing by PTI-CA
of a minimum of $500,000 in additional equity or subordinated debt financing (a
“Financing”), up to an additional $250,000 may be borrowed by PTI-CA under the
Loan Agreement (bringing the total amount outstanding under the Loan Agreement
to $500,000). However, no advances shall be available after May 10,
2010, and the Amendment provides that it shall be an event of default if PTI-CA
does not close a Financing prior to April 30, 2010. As security for
PTI-CA’s obligations under the Loan Agreement, PTI-CA, the Company and the
Company’s wholly owned subsidiaries Vizer Group, Inc. (“Vizer”) and Veritas
Tactical, Inc. (“Veritas”) have granted Agility a security interest in all of
their respective assets.
Amounts
outstanding under the Loan Agreement will be interest-only through January 10,
2010, and monthly payments of principle (in addition to monthly interest
payments at 12% per annum) will be made thereafter pursuant to an amortization
schedule set forth in the Amendment. All amounts outstanding under
the Loan Agreement are due on December 10, 2010 (the “Maturity
Date”). PTI-CA also agreed to pay Agility’s expenses in connection
with the Amendment (approximately $5,000), to pay Agility a facility origination
fee of $12,500 (of which $5,000 was paid on the date of the Amendment and $7,500
will be paid in February 2010) and to pay Agility a monthly loan management fee
of $850. In addition, PTI-CA will pay Agility a loan fee of $50,000
associated with the amendment to the Loan Agreement entered in December 2008
(such loan fee to be paid in installments of $10,000 per month beginning in
March 2010 and ending in July 2010).
Upon an
event of default under the Loan Agreement, the Amendment provides that the
interest rate increases to 18% until the default is cured, and a default fee of
$10,000 will be charged.
The
Company, Vizer and Veritas have guaranteed the performance of PTI-CA’s
obligations under the Loan Agreement. In addition, John Stiska, the
Company’s Chief Executive Officer, has personally guaranteed the payment of all
amounts outstanding under the Loan Agreement.
The
foregoing description of the Amendment and the related unconditional guaranty is
qualified by reference to the Amendment and the unconditional guaranty, which
are attached hereto as Exhibits 10.1 and 10.2, respectively, and incorporated
herein by reference.
In
connection with the execution of the Amendment, the Company issued to Agility a
warrant (the “Warrant”) to purchase up to $150,000 of the Company’s common
stock. The warrant has a term of seven years and carries an exercise
price per share equal to the lesser of (i) $0.10 or (ii) the price per share at
which the Company sells or issues its common stock in a Financing (as a result,
the Warrant is exercisable to purchase a minimum of up to 1,500,000 shares of
the Company’s common stock). The Warrant provides that the exercise
price will be adjusted pursuant to a weighted-average formula in the event the
Company issues additional common shares during the term of the Warrant at a
price per share that is less than the then-effective exercise
price. In addition, upon the occurrence of an event of default under
the Loan Agreement, Agility may acquire a warrant to purchase an additional
50,000 shares of the Company’s common stock for the first 30 days the default
remains uncured and may acquire warrants to purchase an additional 75,000 shares
of the Company’s common stock for each subsequent 30 day period during which the
default remains uncured.
The
Warrants and the securities issuable upon exercise of the Warrants have not been
and will not be registered under the Securities Act of 1933, as amended (the
“Securities Act”) in reliance upon an exemption from registration provided by
Section 4(2) of the Securities Act and/or Regulation D promulgated
thereunder. Such securities may not be offered or sold in the United
States absent registration or an applicable exemption from registration
requirements.
The
foregoing description of the Warrant is qualified by reference to the Warrant,
which is attached hereto as Exhibit 10.3 and incorporated herein by
reference.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation
under an Off-Balance Sheet Arrangement of a Registrant
The information set forth above under
Item 1.01, Entry into a
Material Definitive Agreement, is hereby incorporated by reference into
this Item 2.03.
Item
3.02 Unregistered Sales of Equity Securities
The information set forth above under
Item 1.01, Entry into a
Material Definitive Agreement, is hereby incorporated by reference into
this Item 3.02.
Item
9.01 Financial Statements and Exhibits.
(d) Exhibits.
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10.1
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Eighth
Amendment to Loan Agreement dated December 10, 2009 by and between Agility
Capital, LLC and PepperBall Technologies – CA, Inc., a Delaware
corporation.
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10.2
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Unconditional
Guaranty dated December 10, 2009.
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10.3
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Warrant
to Purchase Common Stock issued on December 10, 2009 by PepperBall
Technologies, Inc., a Colorado corporation, to Agility Capital,
LLC.
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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.
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PepperBall
Technologies, Inc.
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Date:
December 15, 2009
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/s/
Jeffrey G. McGonegal
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Jeffrey
G. McGonegal
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Chief
Financial Officer
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