Attached files
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| EX-99.1 - PRESS RELEASE - NOBLE ROMANS INC | nrom_ex991.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): February 7, 2020
NOBLE ROMAN’S, INC.
(Exact
name of Registrant as specified in its charter)
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Indiana
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0-11104
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35-1281154
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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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6612
E. 75th Street, Suite 450
Indianapolis,
Indiana
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46250
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(Address of
principal executive offices)
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(Zip
Code)
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(317)
634-3377
(Company's
telephone number, including area code)
Not applicable
(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:
[ ]
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))
Securities
registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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N/A
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N/A
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N/A
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Indicate by check
mark whether the registrant is an emerging growth company as
defined in Rule 405 of the Securities Act of 1933 (§230.405 of
this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934
(§240.12b-2 of this chapter)
Emerging Growth
Company ☐
If an
emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 – Entry into a Material Definitive
Agreement.
On
February 7, 2020, Noble Roman’s, Inc. (the
“Company”) entered into a Senior Secured Promissory
Note and Warrant Purchase Agreement (the “Agreement”)
with Corbel Capital Partners SBIC, L.P. (the
“Purchaser”). Pursuant to the Agreement, the Company
issued to the Purchaser a senior secured promissory note (the
“Note”) in the initial principal amount of $8 million.
The Company has used or will use the net proceeds of the Agreement
as follows: (i) $4.2 million was used to repay in their entirety
the Company’s existing bank loans which were in the original
amount of $6.1 million; (ii) $1,275,000 was used to repay the
portion of the Company’s existing subordinated convertible
debt the maturity date of which had not previously been extended to
January 2023; and (iii) the remaining net proceeds will be used for
working capital or other general corporate purposes, including
development of new Company-owned Craft Pizza & Pub
locations.
The
Note bears cash interest of LIBOR, as defined in the Agreement,
plus 7.75%. In addition, the Note requires payment-in-kind interest
(“PIK Interest”) of 3% per annum, which will be added
to the principal amount of the Note. Interest is payable in arrears
on the last calendar day of each month. The Note matures on
February 7, 2025. The Note does not require any fixed principal
payments until February 28, 2023, at which time required monthly
payments of principal in the amount of $33,333 begin and continue
until maturity. The Note requires the Company to make additional
payments on the principal balance of the Note based on its
consolidated excess cash flow, as defined in the
Agreement.
The
repayment of the $1,275,000 in subordinated debt from the proceeds
of the Note eliminated the potential future dilution from the
possible issuance of an aggregate of 3,825,000 shares of common
stock, no par value, of the Company (the “Common
Stock”) into which the convertible notes were convertible and
for which the warrants attached to such notes were exercisable,
likely without consideration to the Company. In conjunction with
the Note, the Company issued to the Purchaser a warrant (the
“Warrant”) to purchase up to 2,250,000 shares of Common
Stock. The Warrant entitles the Purchaser to purchase from the
Company, at any time or from time to time: (i) 1,200,000 shares of
Common Stock at an exercise price of $0.57 per share
(“Tranche 1”), (ii) 900,000 shares of Common Stock at
an exercise price of $0.72 per share (“Tranche 2”), and
(iii) 150,000 shares of Common Stock at an exercise price of $0.97
per share (“Tranche 3”). The Purchaser is required to
exercise the Warrant with respect to Tranche 1 if the Common Stock
is trading at $1.40 per share or higher for a specified period, and
is further required to exercise the Warrant with respect to Tranche
2 if the Common Stock is trading at $1.50 per share or higher for a
specified period. Cashless exercise of the Warrant is only
permitted with respect to Tranche 3. The Purchaser has the right,
within six months after the issuance of any shares under the
Warrant, to require the Company to repurchase such shares for cash
or for Put Notes, at the Company's discretion. The Warrant expires
on the sixth anniversary of the date of its issuance. The sale and
issuance of the Warrant to the Purchaser is exempt from
registration under the Securities Act of 1933, as amended, by
virtue of the exemptions provided in Section 4(a)(2) thereof and
Regulation D of the rules and regulations promulgated
thereunder.
The
Agreement contains customary affirmative and negative covenants,
including, among other things, covenants requiring the Company to
maintain certain financial ratios. The Company’s obligations
under the Agreement are secured by first priority liens on all of
the Company’s and its subsidiaries’
assets.
The
foregoing description of the Agreement, the Note and the Warrant
does not purport to be complete and is qualified in its entirety by
reference to the full text of the Agreement, the Note and the
Warrant, copies of which will be filed as exhibits to the
Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2019.
On
February 10, 2020, the Company issued a news bulletin announcing
the Agreement, the Note and the Warrant, a copy of which is
furnished as Exhibit 99.1 hereto.
Item 1.02 – Termination of a Material Definitive
Agreement.
The
information set forth in Item 1.01 of this Current Report on Form
8-K is incorporated herein by reference.
Item 2.03 – Creation of a Direct Financial Obligation or an
Obligation of 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 herein by reference.
Item 3.02 – Unregistered Sales of Equity
Securities.
The
information set forth in Item 1.01 of this Current Report on Form
8-K is incorporated herein by reference.
Item 9.01 – Financial Statements and Exhibits.
(d)
The following
exhibits are filed as part of this report:
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Exhibit
Number
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Description
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News
Bulletin Issued February 10, 2020
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* *
*
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.
Dated: February 12,
2020
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NOBLE
ROMAN’S, INC.
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By:
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/s/ Paul W.
Mobley
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Paul W.
Mobley
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Executive Chairman
and
Chief Financial
Officer
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