Attached files
| file | filename |
|---|---|
| EX-10.3 - Cyalume Technologies Holdings, Inc. | v192170_ex10-3.htm |
| EX-10.5 - Cyalume Technologies Holdings, Inc. | v192170_ex10-5.htm |
| EX-10.2 - Cyalume Technologies Holdings, Inc. | v192170_ex10-2.htm |
| EX-10.1 - Cyalume Technologies Holdings, Inc. | v192170_ex10-1.htm |
| EX-10.8 - Cyalume Technologies Holdings, Inc. | v192170_ex10-8.htm |
| EX-10.9 - Cyalume Technologies Holdings, Inc. | v192170_ex10-9.htm |
| EX-10.7 - Cyalume Technologies Holdings, Inc. | v192170_ex10-7.htm |
| EX-10.6 - Cyalume Technologies Holdings, Inc. | v192170_ex10-6.htm |
| EX-10.4 - Cyalume Technologies Holdings, Inc. | v192170_ex10-4.htm |
| EX-99.1 - Cyalume Technologies Holdings, Inc. | v192170_ex99-1.htm |
| EX-10.10 - Cyalume Technologies Holdings, Inc. | v192170_ex10-10.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): July 29, 2010
CYALUME TECHNOLOGIES
HOLDINGS, INC.
(Exact
Name of Registrant as Specified in Charter)
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Delaware
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000-52247
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20-3200738
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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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96
Windsor Street, West Springfield MA
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01089
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(Address
of Principal Executive Offices)
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(Zip
Code)
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(413)
858-2500
Registrant’s
telephone number, including area code
Not
Applicable
(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 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(b) under the Exchange Act (17 CFR
240.14a-12(b))
¨ 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))
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Item
1.01
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Entry
into a Material Definitive
Agreement.
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Senior and Subordinated
Loans.
As
previously disclosed by Cyalume Technologies Holdings, Inc. (“CTHI”), the
corporate parent of Cyalume Technologies, Inc. (the “Borrower”), in CTHI’s
Current Reports on Form 8-K filed with the Securities and Exchange Commission on
December 23, 2008, December 18, 2009, April 30, 2010 and July 8, 2010, the
Borrower is a party to a Revolving Credit and Term Loan Agreement with TD Bank,
N.A. (“TD Bank”), dated as of December 19, 2008 as amended by that certain First
Amendment to Credit Agreement and Limited Waiver dated as of September 1, 2009
as further amended by the Second Amendment to Credit Agreement and Limited
Waiver effective December 17, 2009 (the “Second Loan Amendment”), and as
otherwise modified or supplemented from time to time) (as so amended, modified
or supplemented, the “TD Loan Agreement”). The Second Loan Amendment,
among other things, required the Borrower to receive at least $3.0 million in
new subordinated debt or from an equity offering before April 30, 2010 and to
use the net proceeds from that subordinated debt or equity offering to reduce
the outstanding principal balance on the Borrower’s notes payable with TD Bank,
which agreed to extend the deadline from April 30, 2010 to July 31,
2010.
On July
29, 2010, the Borrower fulfilled its obligation to obtain new subordinated debt
by entering into a Subordinated Loan Agreement (the "Subordinated Loan
Agreement") with CTHI, Patriot Capital II, L.P. ("PCII"), Granite Creek Flexcap
I, L.P. ("GCFI"), the other financial institutions or entities from time to time
party thereto as lenders (collectively with PCII and GCFI, the "Subordinated
Lenders"), and Granite Creek Partners Agent, LLC as agent for the Subordinated
Lenders (the "Subordinated Agent").
In
connection with the Borrower and CTHI entering into the Subordinated Loan
Agreement, the Borrower and CTHI amended and restated the TD Loan Agreement in
its entirety by entering into an Amended and Restated Revolving Credit and Term
Loan Agreement dated as of July 29, 2010 (the "Senior Loan Agreement") with TD
Bank as a lender and as agent for itself and the other lenders from time to time
party thereto.
Pursuant
to the terms of the Subordinated Loan Agreement, the Borrower received an
$8,500,000 convertible term loan (the “Subordinated Loan”) from the Subordinated
Lenders. Each Subordinated Lender may at any time, on a single occasion, convert
the entire unpaid principal balance of the portion of the Subordinated Loan held
by such Lender into common stock of CTHI at a conversion price of $3.19 per
share (as may be adjusted by stock dividends and stock splits). The
Subordinated Loan matures on March 19, 2014.
The
application of the net proceeds of such loan is as follows: (a) $7,200,000 to be
applied on August 1, 2010 to the payment of the Term Loan (as defined in the
Senior Loan Agreement) to reduce the amount of the Term Loan to $12,435,000, (b)
$500,000 to be applied on July 29, 2010 to the payment of Revolving Credit Loans
(as defined in the Senior Loan Agreement), (c) $50,000 to be applied on July 29,
2010 to the payment to TD Bank of the Amendment Fee (as defined in the Senior
Loan Agreement) and (d) the remainder to remain with the Borrower.
Interest
on the Subordinated Loan accrues at 11% per annum, payable
monthly. The default interest rate is 15% per annum. The
Borrower paid a $255,000 closing fee to the Subordinated Lenders upon execution
of the Subordinated Loan Agreement. A copy of the Subordinated Loan Agreement is
attached as Exhibit 10.1 hereto and is incorporated herein by
reference.
Pursuant
to a Subordinated Security and Pledge Agreement dated as of July 29, 2009 (the
“Subordinated Security Agreement”), the Borrower granted a second lien on all of
its assets to the Subordinated Agent for the ratable benefit of the Subordinated
Lenders to secure the Borrower's obligations under the Subordinated Loan
Agreement. A copy of the Subordinated Security Agreement is attached
as Exhibit 10.2 hereto and is incorporated herein by reference.
CTHI
entered into a Subordinated Guaranty Agreement dated as of July 29, 2010 whereby
it guaranteed the obligations of the Borrower under the Subordinated Loan
Agreement. A copy of the Subordinated Guaranty Agreement is attached
as Exhibit 10.3 hereto and is incorporated herein by
reference. Pursuant to a Subordinated Stock Pledge Agreement dated as
of July 29, 2010, CTHI granted to the Subordinated Agent for the ratable benefit
of the Subordinated Lenders a second lien in all of its shares of stock in the
Borrower. A copy of the Subordinated Stock Pledge Agreement is
attached as Exhibit 10.4 hereto and is incorporated herein by
reference.
The
Senior Loan Agreement is substantially the same as the TD Loan Agreement that it
amends and restates. Among the terms that changed include that the
amount of the term loan (formerly the Term Loan A under the TD Agreement) was
permanently reduced to $12,435,000 in the Senior Loan Agreement and the amount
of the real estate loan (formerly the Term Loan B under the TD Loan Agreement)
was permanently reduced to $2,105,703.35. The maximum revolving loan
limit under the Senior Loan Agreement is $5,000,000. Under the Senior
Loan Agreement, the Term Loan and the real estate loan each mature on December
19, 2013, while the revolving loan matures on December 19, 2012.
Outstanding
principal under the Senior Loan Agreement bears interest at a rate per annum
equal to either (a) the greater of the prime rate or 3% per annum plus the
Applicable Margin for base rate loans or (b) Reserve Adjusted LIBOR plus the
Applicable Margin for the LIBOR rate loans, each as defined in the Senior Loan
Agreement. The Reserve Adjusted LIBOR portion of 60% of the principal
amount of the Term Loan and 100% of the principal amount of the real estate loan
are subject to interest rate swaps. Such portion of the Term Loan has
been swapped into a fixed rate of 2.53% and the real estate loan has been
swapped with a rate of 2.42%.
The
default interest rate under the Senior Loan Agreement is the then highest
applicable interest rate plus 2% or, the option of the lenders, the Borrower
could instead be made to pay a late fee of 5% of the amount which is
overdue.
The
Borrower shall pay a commitment fee quarterly in arrears under the Senior Loan
Agreement in the amount calculated by multiplying (i) one half of one
percent per annum and (ii) the average daily amount during each calendar
quarter by which the revolving credit loan commitment exceeds the outstanding
amount of revolving credit loans during such calendar quarter or portion
thereof.
The
Senior Loan Agreement contains covenants relating to a fixed charge coverage
ratio, a total debt coverage ratio, a leverage ratio, a current ratio, and a
minimum quarterly EBITDA.
The
Subordinated Loan Agreement contains the same financial covenants listed above
but with additional cushions for the Borrower and CTHI, as
applicable.
Both the
Subordinated Loan Agreement and the Senior Loan Agreement require that the
Borrower will not make, nor permit any of its subsidiaries to make, any capital
expenditures in any fiscal year that exceed $2,000,000 for any fiscal
year.
Both the
Subordinated Loan Agreement and the Senior Loan Agreement contain customary
representations, warranties and covenants, including but not limited to
covenants restricting the Borrower’s ability to incur other indebtedness and to
grant other liens.
Both the
Subordinated Loan Agreement and the Senior Loan Agreement contain optional and
mandatory prepayment provisions, including the requirement that commencing with
a payment on June 1, 2012 and on each June 1 of each year thereafter, the
Borrower must apply an amount equal to 60% of its excess cash flow for the
immediately preceding fiscal year of the Borrower to the prepayment of the
loans.
A copy of
the Senior Loan Agreement is attached as Exhibit 10.5 hereto and is incorporated
herein by reference.
Warrants.
On July
29, 2010, in connection with the above-described transactions, CTHI issued to
(i) CGFI a five-year warrant to purchase up to 94,118 shares of CTHI’s common
stock at price of $2.00 per share and (ii) PCII a five year warrant to purchase
up to 65,882 shares of CTHI’s common stock at price of $2.00 per share. Each
warrant contains provisions for cashless exercise and antidilution protection
upon a distribution of dividends or a reclassification of CTHI’s common stock in
connection with the issuance of the warrants. CTHI entered into a registration
rights agreement with each of GCFI and PCII, pursuant to which each such lender
was granted “piggy-back” registration rights on the shares of CTHI common stock
underlying the Warrants. Copies of the warrants and a form of registration
rights agreement are attached as Exhibits 10.6, 10.7 and 10.8 to this Current
Report on Form 8-K
Amendment to Management
Agreement with Selway Capital, LLC.
On July
29, 2010 CTHI amended its management agreement (the “Amended Management
Agreement”) with Selway Capital, LLC (“Selway”). The original
management agreement was entered into between the parties on October 1, 2009,
and is filed as an exhibit to CTHI’s Form 10-Q filed with the Securities and
Exchange Commission on November 23, 2009. Pursuant to the Amended
Management Agreement, CTHI will (i) reduce the monthly compensation payable to
Selway to $11,666.67 and (ii) issue to Selway 45,000 shares of its common stock.
A copy of the Amended Management Agreement is attached as Exhibit 10.9 to this
Current Report on Form 8-K.
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Item
2.03
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Creation
of a Direct Financial Obligation.
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Reference
is made to the disclosure set forth under Item 1.01 of this Current Report on
Form 8-K, which disclosure is incorporated herein by reference.
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Item
3.02
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Unregistered
Sales of Equity Securities
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Reference
is made to the disclosure set forth under Item 2.01 of this Current Report on
Form 8-K, which disclosure is incorporated herein by reference. The
warrants were issued pursuant to the exemption from registration contained in
Section 4(2) of the Securities Act of 1933, as amended, and the regulations
promulgated thereunder (“Section 4(2)”), because the warrants were issued to
accredited investors in a private transaction. The shares of common stock issued
to Selway were issued to an accredited investor pursuant to Section 4(2) in a
private transaction.
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Item
8.01
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Other
Events.
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On July
29, 2010, CTHI issued a press release announcing the closing of the transactions
described in Item 1.01 of this Current Report on Form 8-K. A copy of
the press release is attached as Exhibit 99.1 to this Current Report on Form
8-K.
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Item
9.01
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Exhibits.
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(d)
Exhibits.
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Exhibit
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Description
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10.1
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Subordinated
Loan Agreement dated as of July 29, 2010 among Cyalume Technologies, Inc.,
Cyalume Technologies Holdings, Inc., the Lenders and other financial
institutions or other entities from time to time parties thereto and
Granite Creek Partners Agent, LLC as Agent
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10.2
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Subordinated
Security and Pledge Agreement dated as of July 29, 2010 between Cyalume
Technologies, Inc. and Granite Creek Partners Agent,
LLC
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10.3
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Subordinated
Guaranty Agreement dated as of July 29, 2010 entered into by Cyalume
Technologies Holdings, Inc. for the benefit of Granite Creek Partners
Agent, LLC
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10.4
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Subordinated
Stock Pledge Agreement dated as of July 29, 2010 entered into by Cyalume
Technologies Holdings, Inc.
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10.5
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Amended
and Restated Revolving Credit and Term Loan Agreement dated as of July 29,
2010 among Cyalume Technologies, Inc., Cyalume Technologies Holdings,
Inc., the Lenders and the other financial institutions or other entities
from time to time parties thereto and TD Bank, N.A., a national banking
association, as Agent and as Lender
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10.6
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Form
of Warrant issued to Granite Creek FlexCap I, L.P.
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10.7
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Form
of Warrant issued to Patriot Capital II, LP
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10.8
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Registration Rights Agreement
between CTHI and Granite Creek FlexCap I,
L.P.
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10.9
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Registration Rights Agreement
between CTHI and Patriot Capital II, LP.
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10.10
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Amended Management Agreement with
Selway Capital, LLC
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99.1
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Press
release dated July 29,
2010
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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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Dated: July
30, 2010
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CYALUME
TECHNOLOGIES HOLDINGS, INC.
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By:
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/s/
Michael Bielonko
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Michael
Bielonko, Chief Financial
Officer
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