Attached files
| file | filename |
|---|---|
| EX-99.1 - MobileSmith, Inc. | v204561_ex99-1.htm |
| EX-10.2 - MobileSmith, Inc. | v204561_ex10-2.htm |
| EX-10.1 - MobileSmith, Inc. | v204561_ex10-1.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):
|
November
30, 2010
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Smart
Online, Inc.
(Exact
name of registrant as specified in its charter)
|
Delaware
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001-32634
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95-4439334
|
||
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(State
or other jurisdiction
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(Commission
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(I.R.S.
Employer
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||
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of
incorporation)
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File
Number)
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Identification
No.)
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||
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4505
Emperor Blvd., Suite 320,
Durham,
North Carolina
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27703
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|||
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code:
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919-765-5000
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Not
Applicable
|
|
Former
name or former address, if changed since last
report
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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:
¨ 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.
On December 6, 2010, Smart Online, Inc.
(the “Company”) entered into (i) a $6,500,000 Promissory Note (the “IDB
Note”), as borrower, and (ii) a Letter Agreement for the $6,500,000 Term Loan
Facility (the “Letter Agreement”), each with Israel Discount Bank of New York
(“IDB”) as lender.
Under the IDB Note and Letter
Agreement, IDB will make available to the Company one or more term loan advances
in the maximum aggregate principal amount of $6,500,000 (the “IDB Credit
Facility”). The IDB Credit Facility is secured by (i) an irrevocable standby
letter of credit issued by HSBC Switzerland in favor of IDB in the aggregate
amount of $2,500,000 and (ii) an irrevocable standby letter of credit issued by
UBS Switzerland in favor of IDB in the aggregate amount of $4,000,000 ((i) and
(ii), together, the “SBLC”), each issued with Atlas Capital S.A. (“Atlas”) as
account party. Atlas and the Company anticipate finalizing in the near future
the terms of the Company’s reimbursement of Atlas for any future drawdowns on
the SBLC. Any advances drawn on the IDB Credit Facility must be repaid on the
earlier of (a) May 31, 2012 or (b) 180 days prior to the expiration date of the
SBLC. Interest on each advance under the IDB Credit Facility accrues, at the
Company’s election, at either LIBOR plus 300 basis points or IDB’s prime rate
plus 100 basis points, provided that the rate of interest for each advance shall
never be less than four percent. Interest accrued on each advance is due
quarterly and payable in arrears on the last day of each February, May, August
and November commencing on the last day of February, 2010.
The IDB Credit Facility replaces the
Company’s revolving line of credit (the “Paragon Credit Facility”) with Paragon
Commercial Bank (“Paragon”), which was orally extended by Paragon beyond its
October 10, 2010 expiration date to November 30, 2010, at which time the Paragon
Credit Facility expired and Paragon drew upon the letter of credit securing the
Paragon Credit Facility as discussed below. The Company continues to maintain a
banking relationship with Paragon through the maintenance of certain operating
accounts.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement.
On November 30, 2010, Paragon drew down
the full amount of the irrevocable standby letter of credit securing the Paragon
Credit Facility (the “Paragon Letter of Credit”), satisfying all of the
obligations of the Company to Paragon, which Paragon Letter of Credit was issued
by HSBC Private Bank (Suisse) S.A. in the amount of $2.5 million, with Atlas as
account party. The Company will reimburse Atlas for Paragon’s draw
upon the Paragon Letter of Credit in cash out of the proceeds of the IDB Credit
Facility, as elected by Atlas pursuant to the Reimbursement Agreement, dated
November 10, 2006, between the Company and Atlas, as subsequently
amended.
Item 9.01 Exhibits.
The
following Exhibits are furnished with this Report:
|
Exhibit
10.1
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Promissory
Note dated December 6, 2010, made by Smart Online, Inc. for the benefit of
Israel Discount Bank of New York, as lender.
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|
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Exhibit
10.2
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Letter
Agreement for $6,500,000.00 Term Facility dated December 6, 2010, by
Israel Discount Bank of New York, and agreed and accepted by Smart Online,
Inc.
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Exhibit 99.1
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Notice
of election of Atlas Capital S.A., dated November 30, 2010, to be
reimbursed in cash for the drawdown on the Paragon Letter of Credit
pursuant to the Reimbursement Agreement, dated November 10, 2006, between
the Company and Atlas, as subsequently
amended.
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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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Smart
Online, Inc.
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|||
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December
6, 2010
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By:
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/s/ Dror
Zoreff
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Name:
Dror Zoreff
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|||
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Title:
Interim President and Chief Executive
Officer
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|||
Exhibit
Index
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Exhibit No.
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Description
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|
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Exhibit
10.1
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Promissory
Note dated December 6, 2010, made by Smart Online, Inc. for the benefit of
Israel Discount Bank of New York, as lender.
|
|
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Exhibit
10.2
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Letter
Agreement for $6,500,000.00 Term Facility dated December 6, 2010, by
Israel Discount Bank of New York, and agreed and accepted by Smart Online,
Inc.
|
|
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Exhibit 99.1
|
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Notice
of election of Atlas Capital S.A., dated November 30, 2010, to be
reimbursed in cash for the drawdown on the Paragon Letter of Credit
pursuant to the Reimbursement Agreement, dated November 10, 2006, between
the Company and Atlas, as subsequently
amended.
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