Attached files
| file | filename |
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| EX-99.1 - PRESS RELEASE - Rekor Systems, Inc. | rekr_ex991.htm |
| EX-10.2 - SECOND AMENDMENT TO NOTE PURCHASE AGREEMENT - Rekor Systems, Inc. | rekr_ex102.htm |
| EX-10.1 - SUBORDINATED PROMISSORY NOTE - Rekor Systems, Inc. | rekr_ex101.htm |
| EX-2.1 - STOCK PURCHASE AGREEMENT - Rekor Systems, Inc. | rekr_ex21.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): April 2,
2020
____________________
REKOR SYSTEMS, INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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001-38338
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81-5266334
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(State
or Other Jurisdiction of Incorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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7172 Columbia Gateway Drive, Suite 400, Columbia, MD
21046
(Address
of Principal Executive Offices)
Registrant's
Telephone Number, Including Area Code: (410)
762-0800
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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Common
Stock, $0.0001 par value per share
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REKR
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The
Nasdaq Stock Market
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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.
AOC Key Solutions Transaction
On
April 2, 2020, Rekor Systems, Inc. (the “Company”)
entered into a Stock Purchase Agreement (the “Purchase
Agreement”) by and among the Company, AOC Key Solutions,
Inc., a Delaware corporation and wholly owned subsidiary of the
Company (“AOC”), and PurpleReign, LLC, a Virginia
limited liability company owned by the members of AOC’s
management (the “Buyer”), pursuant to which the Company
agreed to sell AOC, which specializes in proposal management and
writing, capture management, and market assessment services for
government contractors (the “Business”), to Buyer. B.
Riley FBR, Inc. provided the Company’s Board of Directors
with its opinion that, as of March 31, 2020, the consideration
received by the Company in the Transaction (as defined below) is
fair to the Company’s public stockholders, other than the
stockholder who owns the Buyer, from a financial point of
view.
Subject
to the terms and conditions of the Purchase Agreement, the Buyer
agreed to purchase all of the outstanding equity interests of AOC
for a purchase price of $4,000,000, comprising (i) $3,400,000 in
cash, and (ii) a subordinated promissory note (the
“Subordinated Note”) in the initial principal amount of
$600,000 (the “Transaction”). The Transaction closed
concurrently with execution of the Purchase Agreement.
The
Purchase Agreement contains customary representations, warranties
and covenants related to the Business and the Transaction. For a
period of two years, the Company has agreed not to engage
activities that compete with the Business, nor solicit customers of
the Business, among other covenants with respect to the Business as
set forth more fully in the Purchase Agreement. Both the Company
and the Buyer have agreed to indemnify the other party for losses
arising from certain breaches of covenants contained in the
Purchase Agreement and other liabilities, subject to certain
limitations.
The
Purchase Agreement also contains customary representations and
warranties that the Company and the Buyer made to each other as of
the date of the Purchase Agreement. The assertions embodied in
those representations and warranties were made solely for purposes
of the contract between the Company and the Buyer, and may be
subject to important qualifications and limitations agreed to by
the parties in connection with negotiating its terms. Moreover, the
representations and warranties are subject to a contractual
standard of materiality that may be different from what may be
viewed as material to stockholders of the Company, and the
representations and warranties may have been used to allocate risk
between the Company and the Buyer rather than establishing matters
as facts.
The
foregoing descriptions of the Purchase Agreement and the
Subordinated Note do not purport to be complete and are qualified
in their entirety by reference to the complete text of the Purchase
Agreement and Subordinated Note, respectively. A copy of the
Purchase Agreement is filed as Exhibit 2.1, and a copy of the
Subordinated Note is filed as Exhibit 10.1 to this Current Report
on Form 8-K and are incorporated by reference herein.
Second Amendment to Note Purchase Agreement
As
previously disclosed on the Company’s Current Report on Form
8-K, as filed with the Securities and Exchange Commission (the
“SEC”) on March 18, 2019, the Company entered into that
certain Note Purchase Agreement (the “Note Purchase
Agreement”), by and among the Company, the Company’s
guarantors from time to time party thereto (together with the
Company, the “Credit Parties”), the purchasers from
time to time party thereto (the “Purchasers”) and U.S.
Bank National Association as paying agent and collateral agent (in
such capacity, the “Agent”).
As previously disclosed on the Company’s Current Report on
Form 8-K as filed with the SEC on March 26, 2020, the Company
entered into a First Amendment to Note Purchase Agreement (the
“First Note Amendment”), by and among the Credit
Parties, the Purchasers and the Agent. Pursuant to the terms of the
First Note Amendment, the maturity date for the notes issued under
the First Note Purchase Agreement has been extended from March 11,
2021 to June 12, 2021, unless earlier accelerated pursuant to the
terms of the Note Purchase Agreement, as amended.
On April 2, 2020, the Company entered into a Partial Release and
Second Amendment to Note Purchase Agreement (the “Second
Amendment”), by and among the Credit Parties, the Purchasers
and the Agent. Pursuant to the terms of the Second Amendment, AOC
is released as a Credit Party and the assets related to AOC are
released as collateral, and the Asset Disposition Proceeds terms of
the Note Purchase Agreement were amended to reflect the
Transaction.
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Item 2.01
Completion of Acquisition or Disposition of Assets.
The disclosure set forth above in Item 1.01 regarding the
Transaction is incorporated by reference herein.
Item
7.01 Regulation FD Disclosure.
On April 6, 2020, the Company issued a press release announcing the
Transaction. A copy of this press release is furnished as Exhibit
99.1 hereto and is incorporated by reference herein.
The information furnished in Item 7.01 and Exhibit 99.1 are not
deemed “filed” for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”), is not subject to the liabilities of that section and
is not deemed incorporated by reference in any filing under the
Securities Act of 1933, as amended, or the Exchange
Act.
Item
9.01. Financial Statements and Exhibits
(d)
Exhibits.
The following exhibits are filed herewith:
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Exhibit Number
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Description
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2.1†
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Stock Purchase
Agreement, dated April 2, 2020, by and among Rekor Systems, Inc.,
AOC Key Solutions, Inc. and PurpleReign, LLC.
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10.1*
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Subordinated
Promissory Note dated April 2, 2020.
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Second Amendment
to Note Purchase Agreement,
dated April 2, 2020, by and among the Company, the Purchasers from
time to time party thereto and the
Agent.
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First Amendment to Note Purchase Agreement, dated March 26, 2020,
by and among the Company, the Purchasers from time to time party
thereto and the Agent (incorporated by reference to Exhibit 10.1 to
the Current Report on Form 8-K as filed with the Securities and
Exchange Commission on March 26, 2020.).
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Note Purchase
Agreement, dated as of March 13, 2019, by and among the Credit
Parties, the Purchasers from time to time party thereto and the
Agent (incorporated by reference to Exhibit 4.3 to the Current
Report on Form 8-K as filed with the Securities and Exchange
Commission on March 18, 2019).
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Press Release
issued on April 6, 2020
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†
Schedules
and similar attachments to this Exhibit have been omitted pursuant
to Item 601(a)(5) of Regulation S-K. The Company agrees to furnish
supplementally a copy of such omitted materials to the SEC upon
request.
*
Certain portions
of this Exhibit have been redacted pursuant to Item 601(b)(10) of
Regulation S-K. The Company agrees to furnish supplementally an
unredacted copy of this Exhibit to the SEC upon
request.
3
SIGNATURE
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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REKOR SYSTEMS, INC.
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Date:
April 6, 2020
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/s/
Robert A. Berman
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Name:
Robert A. Berman
Title:
President and Chief Executive Officer
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