INSEEGO CORP. (NASDAQ:INSG) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01.
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Entry into a Material Definitive Agreement.
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Credit Agreement
On May 8, 2017, Inseego Corp., a Delaware corporation (the
Company), and certain of its direct and indirect subsidiaries
(the Guarantors) entered into a Credit Agreement (the Credit
Agreement) with Lakestar Semi Inc., a private investment fund
managed by Soros Fund Management LLC (the Lender). to the Credit
Agreement, the Lender provided the Company with a single term
loan in the principal amount of $20.0 million (the Loan) with a
maturity date of May 8, 2018 (the Maturity Date). The Credit
Agreement requires that any proceeds from the pending sale of the
Companys mobile broadband business, which includes its MiFi
branded hotspots and USB modem product lines, be used to repay
the Loan. The Loan is secured by a first priority lien on
substantially all of the assets of the Company, including its
equity interests in certain of its direct and indirect
subsidiaries, subject to certain exceptions and permitted liens.
The Credit Agreement includes customary representations and
warranties, as well as customary reporting and financial
covenants. The Company also paid a $2.0 million commitment fee in
conjunction with the closing of the Loan.
Company), and certain of its direct and indirect subsidiaries
(the Guarantors) entered into a Credit Agreement (the Credit
Agreement) with Lakestar Semi Inc., a private investment fund
managed by Soros Fund Management LLC (the Lender). to the Credit
Agreement, the Lender provided the Company with a single term
loan in the principal amount of $20.0 million (the Loan) with a
maturity date of May 8, 2018 (the Maturity Date). The Credit
Agreement requires that any proceeds from the pending sale of the
Companys mobile broadband business, which includes its MiFi
branded hotspots and USB modem product lines, be used to repay
the Loan. The Loan is secured by a first priority lien on
substantially all of the assets of the Company, including its
equity interests in certain of its direct and indirect
subsidiaries, subject to certain exceptions and permitted liens.
The Credit Agreement includes customary representations and
warranties, as well as customary reporting and financial
covenants. The Company also paid a $2.0 million commitment fee in
conjunction with the closing of the Loan.
Interest on the Loan will be payable on the last business day of
each calendar month and on the Maturity Date. The Loan will bear
interest at a rate per annum equal to the London Interbank
Offered Rate (LIBOR) for Dollar deposits with a term equivalent
to the applicable three-month interest period, but in no event
less than one percent (1.00%), plus ten percent (10.00%). If an
event of default occurs, the Lender may convert the Loan into a
Base Rate Loan, in which case, the Loan will bear interest at a
fluctuating rate of interest per annum equal to the higher of (a)
the Federal Funds Rate plus one-half of one percent (0.50%) and
(b) the rate last quoted by The Wall Street Journal (or another
national publication selected by the Lender) as the U.S. Prime
Rate, but in no event less than two percent (2.00%), plus nine
percent (9.00%).
each calendar month and on the Maturity Date. The Loan will bear
interest at a rate per annum equal to the London Interbank
Offered Rate (LIBOR) for Dollar deposits with a term equivalent
to the applicable three-month interest period, but in no event
less than one percent (1.00%), plus ten percent (10.00%). If an
event of default occurs, the Lender may convert the Loan into a
Base Rate Loan, in which case, the Loan will bear interest at a
fluctuating rate of interest per annum equal to the higher of (a)
the Federal Funds Rate plus one-half of one percent (0.50%) and
(b) the rate last quoted by The Wall Street Journal (or another
national publication selected by the Lender) as the U.S. Prime
Rate, but in no event less than two percent (2.00%), plus nine
percent (9.00%).
If there is an event of default on or prior to the Maturity Date,
the Loan will incur default interest at a rate per annum equal to
five percent (5%) in excess of the interest rate otherwise
applicable to such obligation. If there is an event of default
after the Maturity Date, the Loan will incur default interest at
a rate per annum equal to ten percent (10%) in excess of the
interest rate otherwise applicable to such obligation. Upon the
occurrence and during the continuation of an event of default,
which includes, among other things, the failure of the Company or
any Guarantor to pay when due and payable all or any portion of
the obligations under the Credit Agreement, the Lender may
declare such obligations immediately due and payable.
the Loan will incur default interest at a rate per annum equal to
five percent (5%) in excess of the interest rate otherwise
applicable to such obligation. If there is an event of default
after the Maturity Date, the Loan will incur default interest at
a rate per annum equal to ten percent (10%) in excess of the
interest rate otherwise applicable to such obligation. Upon the
occurrence and during the continuation of an event of default,
which includes, among other things, the failure of the Company or
any Guarantor to pay when due and payable all or any portion of
the obligations under the Credit Agreement, the Lender may
declare such obligations immediately due and payable.
The foregoing description of the Credit Agreement does not
purport to be complete and is subject to, and qualified in its
entirety by, the full text of the Credit Agreement, a copy of
which will be filed as an exhibit to the Companys Quarterly
Report on Form 10-Q for the period ending June 30, 2017.
purport to be complete and is subject to, and qualified in its
entirety by, the full text of the Credit Agreement, a copy of
which will be filed as an exhibit to the Companys Quarterly
Report on Form 10-Q for the period ending June 30, 2017.
Security and Pledge Agreement
On May 8, 2017, the Company and the Guarantors entered into a
Security and Pledge Agreement (the Security Agreement) with the
Lender to which the Company and the Guarantors pledged certain of
their assets, including the equity interests of certain of their
direct and indirect subsidiaries, as collateral to secure the
Loan.
Security and Pledge Agreement (the Security Agreement) with the
Lender to which the Company and the Guarantors pledged certain of
their assets, including the equity interests of certain of their
direct and indirect subsidiaries, as collateral to secure the
Loan.
The foregoing description of the Security Agreement does not
purport to be complete and is subject to, and qualified in its
entirety by, the full text of the Security Agreement, a copy of
which will be filed as an exhibit to the Companys Quarterly
Report on Form 10-Q for the period ending June 30, 2017.
purport to be complete and is subject to, and qualified in its
entirety by, the full text of the Security Agreement, a copy of
which will be filed as an exhibit to the Companys Quarterly
Report on Form 10-Q for the period ending June 30, 2017.
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Item 1.02.
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Termination of a Material Agreement.
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On May 8, 2017, upon entering into the Credit Agreement described
above, the Company terminated that certain Credit and Security
Agreement among the Company, Novatel Wireless, Inc., Enfora,
Inc., Feeney Wireless, LLC, R.E.R. Enterprises, Inc., Feeney
Wireless IC-DISC, Inc. and Wells Fargo Bank, National
Association, dated as of October 31, 2014 (as amended, modified
and supplemented from time to time, the Prior Credit Agreement).
The Prior Credit Agreement provided for a $10.0 million secured
revolving credit facility. The Company paid a $240,000 early
termination fee in connection with the termination of the Prior
Credit Agreement.
above, the Company terminated that certain Credit and Security
Agreement among the Company, Novatel Wireless, Inc., Enfora,
Inc., Feeney Wireless, LLC, R.E.R. Enterprises, Inc., Feeney
Wireless IC-DISC, Inc. and Wells Fargo Bank, National
Association, dated as of October 31, 2014 (as amended, modified
and supplemented from time to time, the Prior Credit Agreement).
The Prior Credit Agreement provided for a $10.0 million secured
revolving credit facility. The Company paid a $240,000 early
termination fee in connection with the termination of the Prior
Credit Agreement.
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Item 2.02.
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Results of Operations and Financial Condition.
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The information in Item 2.02 Results of Operations and Financial
Condition of this Current Report on Form 8-K and in Exhibit 99.2,
attached hereto, is furnished and shall not be deemed filed for
purposes of Section 18 of the Securities Exchange Act of 1934, as
amended (the Exchange Act), or otherwise subject to the
liabilities of that section. It may be
Condition of this Current Report on Form 8-K and in Exhibit 99.2,
attached hereto, is furnished and shall not be deemed filed for
purposes of Section 18 of the Securities Exchange Act of 1934, as
amended (the Exchange Act), or otherwise subject to the
liabilities of that section. It may be
incorporated by reference in a filing under the Exchange Act or
the Securities Act of 1933, as amended, only if such subsequent
filing specifically references such disclosure in this Form 8-K.
the Securities Act of 1933, as amended, only if such subsequent
filing specifically references such disclosure in this Form 8-K.
On May 10, 2017, Inseego Corp. issued a press release containing
preliminary financial results for the first>quarter ended
March 31, 2017.
preliminary financial results for the first>quarter ended
March 31, 2017.
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Item 2.03.
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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 of this Current Report on
Form 8-K is incorporated by reference into this Item 2.03 in its
entirety.
Form 8-K is incorporated by reference into this Item 2.03 in its
entirety.
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Item 5.02.
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Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On May 9, 2017, the Companys Chief Financial Officer, Michael
Newman, notified the Company that he has decided to resign from
his position effective May 15, 2017 due to family and personal
reasons. He will serve in an advisory role to assist in the
conclusion of the Companys sale of its MiFi mobile broadband
business and the transition to a new permanent Chief Financial
Officer.
Newman, notified the Company that he has decided to resign from
his position effective May 15, 2017 due to family and personal
reasons. He will serve in an advisory role to assist in the
conclusion of the Companys sale of its MiFi mobile broadband
business and the transition to a new permanent Chief Financial
Officer.
On May 9, 2017, the Company appointed Tom Allen, age 64, to serve
as Chief Financial Officer, effective May 16, 2017, on an interim
basis until the Companys executive search is able to identify and
hire a permanent Chief Financial Officer. The Companys Board of
Directors has not yet finalized the compensation and other terms
of Mr. Allens employment following his appointment as the
Companys Chief Financial Officer.
as Chief Financial Officer, effective May 16, 2017, on an interim
basis until the Companys executive search is able to identify and
hire a permanent Chief Financial Officer. The Companys Board of
Directors has not yet finalized the compensation and other terms
of Mr. Allens employment following his appointment as the
Companys Chief Financial Officer.
Mr. Allen previously served as the interim Chief Financial
Officer for the Companys predecessor company, Novatel Wireless,
Inc., from June 2014 to September 2014, when Mr. Allen
transitioned the Chief Financial Officer role to Mr. Newman.
Prior to joining the Company, Mr. Allen served as Executive Vice
President and Chief Operating and Chief Financial Officer for
Outdoor Channel Holdings, Inc. a publicly traded national cable
television network and production services company from July 2010
through September 2013 when the company was acquired by Kroenke
Sports and Entertainment. Since September 2013, Mr. Allen has
served as an independent business consultant, providing services
in the areas of finance, tax and accounting. Throughout his
career, Mr. Allen has held executive positions at major
broadcasting and entertainment firms, including Virgin
Interactive Entertainment and Fox Broadcasting Company. He has
also served on the board of directors of public and private
companies. Mr. Allen attended the University of Southern
California and is a certified public accountant.
Officer for the Companys predecessor company, Novatel Wireless,
Inc., from June 2014 to September 2014, when Mr. Allen
transitioned the Chief Financial Officer role to Mr. Newman.
Prior to joining the Company, Mr. Allen served as Executive Vice
President and Chief Operating and Chief Financial Officer for
Outdoor Channel Holdings, Inc. a publicly traded national cable
television network and production services company from July 2010
through September 2013 when the company was acquired by Kroenke
Sports and Entertainment. Since September 2013, Mr. Allen has
served as an independent business consultant, providing services
in the areas of finance, tax and accounting. Throughout his
career, Mr. Allen has held executive positions at major
broadcasting and entertainment firms, including Virgin
Interactive Entertainment and Fox Broadcasting Company. He has
also served on the board of directors of public and private
companies. Mr. Allen attended the University of Southern
California and is a certified public accountant.
There are no arrangements or understandings between Mr. Allen and
any other persons to which he was selected as the Companys Chief
Financial Officer. There are also no family relationships between
Mr. Allen and any director or executive officer of the Company,
and he has no direct or indirect material interest in any
transaction required to be disclosed to Item 404(a) of Regulation
S-K.
any other persons to which he was selected as the Companys Chief
Financial Officer. There are also no family relationships between
Mr. Allen and any director or executive officer of the Company,
and he has no direct or indirect material interest in any
transaction required to be disclosed to Item 404(a) of Regulation
S-K.
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Item 8.01.
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Other Events.
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On May 10, 2017, the Company issued a press release announcing
that it had entered into the Credit Agreement and the Security
Agreement and terminated the Prior Credit Agreement. A copy of
the press release is attached as Exhibit 99.1 to this Current
Report on Form 8-K and is incorporated herein by reference.
that it had entered into the Credit Agreement and the Security
Agreement and terminated the Prior Credit Agreement. A copy of
the press release is attached as Exhibit 99.1 to this Current
Report on Form 8-K and is incorporated herein by reference.
Also on May 10, 2017, the Company issued a press release
announcing Mr. Newmans decision to resign from his position
effective May 15, 2017 and Mr. Allens appointment as Chief
Financial Officer. A copy of the press release is attached as
Exhibit 99.3 to this Current Report on Form 8-K and is
incorporated herein by reference.
announcing Mr. Newmans decision to resign from his position
effective May 15, 2017 and Mr. Allens appointment as Chief
Financial Officer. A copy of the press release is attached as
Exhibit 99.3 to this Current Report on Form 8-K and is
incorporated herein by reference.
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Item 9.01.
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Financial Statements and Exhibits.
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(d) Exhibits.
99.1 Press release, dated May 10, 2017.
99.2 Press release, dated May 10, 2017, containing Inseego Corp.
preliminary financial results for the first>quarter ended
March 31, 2017.
preliminary financial results for the first>quarter ended
March 31, 2017.
99.3 Press release, dated May 10, 2017.
About INSEEGO CORP. (NASDAQ:INSG)
Inseego Corp, formerly Novatel Wireless, Inc., is a provider of software-as-a-service (SaaS) and solutions for the Internet of Things (IoT). The Company offers a range of products, including mobile hotspots, universal serial bus (USB) modems, embedded modules, integrated asset-management and mobile tracking machine-to-machine (M2M) devices, communications and applications software and cloud services. The Company sells its telematics solutions under the Ctrack brand, including its fleet management, asset tracking and monitoring, stolen vehicle recovery, and usage-based insurance platforms. It operates in the wireless communications industry in two product categories: M2M Products and Solutions, and Mobile Computing Solutions. It sells business connectivity solutions and device management services through its subsidiaries. Its products operate on cellular wireless technology platform. It serves over 590,000 global subscribers, including 182,000 fleet management subscribers. INSEEGO CORP. (NASDAQ:INSG) Recent Trading Information
INSEEGO CORP. (NASDAQ:INSG) closed its last trading session down -0.01 at 1.83 with 146,655 shares trading hands.
