ATRM Holdings, Inc. (OTCMKTS:ATRM) Files An 8-K Entry into a Material Definitive AgreementItem 1.01
On January 12, 2018, ATRM Holdings, Inc. (the “Company”) issued to Lone Star Value Co-Invest I, LP (“LSV Co-Invest I”) an unsecured promissory note in the principal amount of $500,000.00 in exchange for the same amount in cash (the “Note”). The Note was issued to a securities purchase agreement by and between the Company and LSV Co-Invest I dated as of the same date. The Note bears interest at 10.0% per annum, with interest payable semiannually; provided, however, LSV Co-Invest I may elect to receive any interest payment in-kind (“PIK Interest”) at an annual rate of 12.0%, so long as any such interest payment is made either (x) entirely in PIK Interest or (y) 50% cash and 50% PIK Interest. Any unpaid principal and interest under the Note is due on January 12, 2020. The Company may prepay the Note at any time after a specified amount of advance notice to LSV Co-Invest I (subject to certain restrictions under the Company’s existing loan agreements). The Note provides for customary events of default, the occurrence of any of which may result in the principal and unpaid interest then outstanding becoming immediately due and payable.
As of January 12, 2018, in addition to the Note, LSV Co-Invest I held 342,776 shares of the Company’s 10.00% Series B Cumulative Preferred Stock (the “Series B Stock”), and Lone Star Value Investors, LP (“LSVI”), an affiliate of LSV Co-Invest I, held 1,067,885 shares of the Company’s common stock, or approximately 44.6% of its outstanding shares, and 203,689 shares of the Series B Stock. Additionally, 10,000 shares of the Company’s common stock are held in an account managed by Lone Star Value Management, LLC (“LSVM”), an affiliate of LSVI and LSV Co-Invest I. Jeffrey E. Eberwein, Chairman of the Company’s Board of Directors, is the manager of Lone Star Value Investors GP, LLC, the general partner of LSVI and LSV Co-Invest I, and sole member of LSVM, the investment manager of LSVI. The Company’s sale of the Note to LSV Co-Invest I was approved by the independent members of the Company’s Board of Directors.
| 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 in Item 1.01 is incorporated by reference into this Item 2.03.
| Item 9.01 | Financial Statements and Exhibits. |
| Exhibit No. | Description |
| 4.1 | Promissory Note, dated January 12, 2018, made by ATRM Holdings, Inc. for the benefit of Lone Star Value Co-Invest I, LP. |
| 10.1 | Securities Purchase Agreement, dated as of January 12, 2018, by and between ATRM Holdings, Inc. and Lone Star Value Co-Invest I, LP. |
ATRM Holdings, Inc. ExhibitEX-4.1 2 ex4-1.htm Exhibit 4.1 THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,…To view the full exhibit click here