Unassociated Document
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): October 22, 2007
_____________
CASTLE
BRANDS INC.
(Exact
name of registrant as specified in its charter)
Delaware
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001-32849
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41-2103550
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(State
or Other Jurisdiction of Incorporation)
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(Commission
File Number)
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(I.R.S.
Employer Identification No.)
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570
Lexington Avenue, 29th
Floor
New
York, New York 10022
(Address
of principal executive offices)
(646)
356-0200
(Registrant's
telephone number,
including
area code)
____________________________________________
(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 (see General Instruction A.2. below):
o
Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule
14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant
to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant
to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item
2.03
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Creation
of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a of a
Registrant
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On
October 22, 2007, Castle Brands Inc. (the "Company") entered into a credit
agreement (the “Credit Agreement”) with Frost Nevada Investments Trust (the
“Lender”), which is controlled by Dr. Phillip Frost, a former director of the
Company, pursuant to which the Company may borrow up to $5,000,000 (the “Credit
Facility”). Amounts borrowed pursuant to the Credit Facility are evidenced by a
grid note, dated as of October 22, 2007, issued by the Company to the Lender
(the “Note”). The Company does not presently anticipate borrowing any advances
under the Credit Facility. Any amounts outstanding under the Credit Facility
bear interest at a rate of 10% per annum. Interest is payable quarterly. The
maturity date of any amounts outstanding is the earlier of (i) one business
day
after the closing of financing transactions which results in aggregate gross
proceeds to the Company of at least $10,000,000 and (ii) February 28,
2009.
The
Company may prepay amounts outstanding under the Credit Facility at any time
at
its sole discretion. An event of default under the Credit Facility occurs if
the
Company (a) fails to make payment of principal or interest on the maturity
date,
(b) fails to make payment of any fees or quarterly interest payments when due
and after 10 business days of prior written notice to the Company by the Lender
of the failure to pay, (c) breaches the affirmative covenants contained in
the
Credit Agreement and fails to cure the breach generally within 30 days of the
breach or (d) becomes insolvent or begins an insolvency proceeding or one is
begun against the Company and is not dismissed or stayed within 90 days. If
an
event of default occurs, the Lender may declare all principal and interest
immediately due and payable and the interest rate will increase by 200 basis
points above the current interest rate.
Upon
entering into the Credit Agreement, the Company paid the Lender a facility
fee
of $175,000. If the Company draws down any amount under the Credit Facility,
upon the Company receiving its first advance, the Company would have to pay
the
Lender an additional facility fee of $200,000. As additional consideration
for
entering into the Credit Facility, the Company issued to the Lender a warrant
to
purchase 50,000 shares of Common Stock, par value $0.01 per share, at an
exercise price of $4.00 per share (the “Warrant”).
The
descriptions of the terms and conditions of the Credit Agreement, Note and
Warrant set forth herein do not purport to be complete and are qualified in
their entirety by reference to the full text of the Credit Agreement, Note
and
Warrant attached hereto as Exhibits 10.74, 10.75 and 10.76, respectively, and
incorporated herein by this reference.
Item
9.01
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Financial
Statements and Exhibits.
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Exhibit No.
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Description
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|
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10.74
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Credit
Agreement, dated as of October 22, 2007, by and among Castle Brands
Inc.
and Frost Nevada Investments Trust.
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|
|
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10.75
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Promissory
Note, dated October 22, 2007, made by Castle Brands Inc. in favor
of Frost
Nevada Investments Trust.
|
|
|
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10.76
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Warrant issued
by Castle Brands Inc. to Frost Nevada Investments Trust on October
22,
2007.
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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.
Date: October
26, 2007
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CASTLE
BRANDS INC.
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By: |
/s/ Mark
Andrews |
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Name:
Mark Andrews
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Title:
CEO and Chairman
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EXHIBIT
INDEX
Exhibit No.
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Description
|
|
|
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10.74
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Credit
Agreement, dated as of October 22, 2007, by and among Castle Brands
Inc.
and Frost Nevada Investments Trust.
|
|
|
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10.75
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Promissory
Note, dated October 22, 2007, made by Castle Brands Inc. in favor
of Frost
Nevada Investments Trust.
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|
|
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10.76
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|
Warrant issued
by Castle Brands Inc. to Frost Nevada Investments Trust on October
22,
2007.
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