Unassociated Document
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 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) June
30,
2008
iCAD,
INC.
|
(Exact
Name of Registrant as Specified in Its
Charter)
|
Delaware
|
(State
or Other Jurisdiction of
Incorporation)
|
1-9341
|
|
02-0377419
|
(Commission
File Number)
|
|
(IRS
Employer Identification No.)
|
98
Split Brook Road, Suite 100, Nashua, New Hampshire
|
|
03062
|
(Address
of Principal Executive Offices)
|
|
(Zip
Code)
|
(603)
882-5200
|
(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):
|
¨ |
Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
|
|
¨ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
|
¨
|
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))
|
Item
1.01 |
Entry
into a Material Definitive
Agreement.
|
Item
2.03 |
Creation
of a Direct Financial Obligation or an Obligation Under an Off-Balance
Sheet Arrangement of a
Registrant.
|
On
June
30, 2008, iCAD, Inc. (the “Registrant”) entered into a Loan and Security
Agreement (the “Loan Agreement”) with RBS Citizens, N.A. (“RBS”). The Loan
Agreement replaces the Prior Loan Agreement (as defined and described in Item
1.02 below). The Loan Agreement established a secured revolving credit facility
with a line of credit of up to $5,000,000. Unless earlier repaid, all amounts
due and owing under the Loan Agreement are required to be repaid on June 30,
2009, the stated termination date of the Loan Agreement.
The
Loan
Agreement contains certain financial and non-financial covenants relating to
the
Registrant. The Loan Agreement also contains certain events of default,
including, without limitation, payment defaults, breaches of representations
and
warranties, covenant defaults, cross-defaults to any material indebtedness,
events of bankruptcy and insolvency, certain ERISA events, judgments in excess
of specified amounts, and a failure of the Registrant’s Chief Executive Office
(“CEO”) or Chief Financial Officer (“CFO”) to continue serving as such without a
replacement reasonably satisfactory to RBS being retained within 120 days of
either the CEO or CFO ceasing to serve as such. Amounts due under the Loan
Agreement and the related Revolving Note (the “Note”) dated June 30, 2008 made
by the Registrant in favor of RBS, may be prepaid at any time, in whole or
in
part, at the option of the Registrant, provided, however, that for any portion
of the loan accruing interest as a “LIBOR Rate Loan” (as defined the in the Loan
Agreement), Registrant is responsible to pay any LIBOR Breakage Fee as defined
and further described in the Note. All amounts outstanding under the Loan
Agreement and the associated Note will bear interest, at the Registrant’s
option, at a fluctuating per annum rate of interest equal to (i) Prime Rate
(as
defined in the Note) plus one-half of one percent (0.05%) or (ii) the Adjusted
LIBOR Rate (as defined in the Note) plus the LIBOR Rate Margin (as defined
in
the Note).
In
connection with the Loan Agreement and the Note, the Registrant has entered
into
a Negative Pledge Agreement dated June 30, 3008 and made in favor of RBS.
Pursuant to the Negative Pledge Agreement, the Registrant agreed, among other
things, (i) not to incur any liens, other than as permitted under the Loan
Agreement, with respect to the Registrant’s intellectual property and (ii) not
to sell or assign, other than for fair consideration in the ordinary course
of
business, the Registrant’s intellectual property.
The
descriptions of the Loan Agreement, Note and Negative Pledge Agreement do not
purport to be complete and are qualified in their entirety by reference to
the
full text of the applicable agreements, each of which is filed as an exhibit
to
this Report. The Loan Agreement, Note and Negative Pledge Agreement have been
included to provide investors and security holders with information regarding
their respective terms. These agreements are not intended to provide any other
factual information about the Registrant or the other parties thereto. Each
of
the Loan Agreement, Note and Negative Pledge Agreement contains representations
and warranties the parties thereto made to, and solely for the benefit of,
the
other parties thereto. Accordingly, investors and security holders should not
rely on the representations and warranties as characterizations of the actual
state of facts, since they were only made as of the date of such agreements.
In
addition, each of the Loan Agreement, Note and Negative Pledge Agreement is
modified by the underlying disclosure schedules, if any. Moreover, information
concerning the subject matter of the representations and warranties may change
after the date of each of the Loan Agreement, Note and Negative Pledge
Agreement, which subsequent information may or may not be fully reflected in
the
Registrant's public disclosures.
Item
1.02 |
Termination
of a Material Definitive
Agreement.
|
Item
3.02 |
Unregistered
Sales of Equity
Securities.
|
As
a
condition to, and simultaneously with, the execution by RBS of the Loan
Agreement, the unpaid principal amount and accrued interest on the Registrant’s
debt incurred under the Revolving Loan and Security Agreement and related
Convertible Revolving Credit Promissory Note dated October 26, 1987, as amended,
between the Registrant and Robert Howard, the former Chairman of the Board
and a
current principal stockholder of the Registrant (the “Prior Loan Agreement”),
was extinguished as follows: (1) a total of $2,000,000 principal amount under
the Prior Loan Agreement, together with approximately $351,917 of accrued and
unpaid interest on such principal amount, was converted by Mr. Howard into
1,622,012 shares of the Registrant’s common stock at $1.45 per share and (2) the
remaining principal balance under the Prior Loan Agreement of
approximately $258,906, together with accrued and unpaid interest of
approximately $55,598 on such principal amount, was paid in cash to Mr. Howard.
The Prior Loan Agreement has, therefore, been fully repaid and satisfied and
was
terminated as of June 30, 2008.
Item
9.01 |
Financial
Statements and Exhibits.
|
(d)
Exhibits.
Exhibit No.
|
|
Description of Exhibit
|
|
|
|
10.1*
|
|
Loan
and Security Agreement dated as of June 30, 2008 by and between the
Registrant and RBS Citizens, N.A.
|
|
|
|
10.2
|
|
Revolving
Note dated as of June 30, 2008 made by the Registrant in favor of
RBS
Citizens, N.A.
|
|
|
|
10.3
|
|
Negative
Pledge Agreement dated June 30, 2008 by the Registrant as accepted
by RBS
Citizens, N.A.
|
*
The
Registrant has omitted certain schedules and exhibits pursuant to Item 601(b)(2)
of Regulation S-K and shall furnish supplementally to the SEC copies any of
the
omitted schedules and exhibits upon request by the SEC.
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 thereunto
duly authorized.
iCAD,
INC. |
(Registrant) |
|
|
By:
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/s/ Darlene Deptula-Hicks
|
|
Darlene Deptula-Hicks
|
|
Executive Vice President of Finance and
Chief Financial Officer
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EXHIBIT
INDEX
Exhibit No.
|
|
Description of Exhibit
|
|
|
|
10.1*
|
|
Loan
and Security Agreement dated as of June 30, 2008 by and between the
Registrant and RBS Citizens, N.A.
|
|
|
|
10.2
|
|
Revolving
Note dated as of June 30, 2008 made by the Registrant in favor of
RBS
Citizens, N.A.
|
|
|
|
10.3
|
|
Negative
Pledge Agreement dated June 30, 2008 by the Registrant as accepted
by RBS
Citizens, N.A.
|
*
The
Registrant has omitted certain schedules and exhibits pursuant to Item 601(b)(2)
of Regulation S-K and shall furnish supplementally to the SEC copies any of
the
omitted schedules and exhibits upon request by the SEC.