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SPIR > SEC Filings for SPIR > Form 8-K on 24-Sep-2013All Recent SEC Filings

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Form 8-K for SPIRE CORP


24-Sep-2013

Entry into a Material Definitive Agreement, Completion of Acquisition or Disposition o


Item 1.01 Entry into a Material Definitive Agreement.

On September 18, 2013, Spire Corporation (the "Company"), Spire Biomedical, Inc. (the "Subsidiary" and together with the Company, "Spire") entered into an Asset Purchase Agreement (the "Purchase Agreement") with N2 Biomedical LLC ("N2") pursuant to which N2 agreed to (i) acquire substantially all of the assets of Spire's biomedical business (the "Business") and (ii) assume and pay certain liabilities related to the purchased assets as set forth in the Purchase Agreement (collectively, the "Transaction"). The Transaction closed on September 18, 2013.

The purchase price for the Business was $10.5 million plus the assumption of liabilities of approximately $0.1 million, with $6.0 million paid in cash at closing, a $2.4 million subordinated convertible promissory note, and 310,549 Series A Preferred Units of N2 valued at approximately $2.1 million ($6.72 per share). The parties determined the purchase price through negotiation, as well as the parties' determination of fair market value of, and solicitation of third party bids on, the Business. The board of directors, including all of the disinterested directors, unanimously approved the Transaction after full disclosure of all material facts of the Transaction and each director's interest in the Transaction.

The subordinated promissory note (i) bears interest at 9% per annum until paid in full, (ii) is convertible, at Spire's option, into Common Units of N2 at a conversion price of $6.72 per share, (iii) has a seven year term, (iv) is unsecured and (v) is subordinate in right of payment to all senior bank indebtedness of N2.

The Series A Preferred Units (i) represent an equity ownership interest of 19.9% in N2, (ii) are governed by the terms of the Amended and Restated Limited Liability Company Agreement of N2 dated September 18, 2013, (iii) rank senior to the Common Units on liquidation, dissolution and winding up, and (iv) vote together with the Common Units on an as-converted basis. Spire has the right to appoint one director to the Board of Directors of N2. N2 is subject to certain affirmative and negative operating covenants in favor of the holder of Series A Preferred Units.

On September 18, 2013, the Company and N2 entered into a Shared Services Agreement whereby the Company will provide N2 certain services (the "Shared Services") for a period of three years. It is the intent of the parties that the aggregate fees for the Shared Services shall equal approximately $500,000 during the first year. Following the first anniversary, N2 may terminate any specific Shared Service with 20 days' written notice to the Company.

On September 18, 2013, the lease agreement between SPI-Trust and the Company for the premises in Bedford, Massachusetts where the Business is located was amended, by reducing the Company's leased space and annual base rent by approximately 19%. All other material terms and conditions related to the lease remain unchanged as of such date.

The Purchase Agreement includes a five-year commitment of (i) Spire not to compete with the Business and (ii) N2 not to compete with the consumer electronic products business of Spire. Both Spire and N2 agreed not to solicit the officers or employees of the other party for a one-year period. The Purchase Agreement also contains customary representations and warranties, post-closing covenants and mutual indemnification obligations for, among other things, inaccuracy or breach of any representation or warranty and any breach or non-fulfillment of any covenant. A copy of the Purchase Agreement is filed herewith as Exhibit 2.1, and is incorporated herein by reference. The foregoing summary of the Agreement is qualified in its entirety by reference to the form of Agreement filed herewith

Mark C. Little was the Chief Executive Officer of the Subsidiary, is a director of the Company and is the Chief Executive Officer of N2. Mark C. Little is the son of Roger G. Little, Chief Executive Officer of the Company.



Item 2.01 Completion of Acquisition or Disposition of Assets.

The information contained in Item 1.01 above is incorporated herein by reference.



Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.      Exhibit Description
          *2.1   Asset Purchase Agreement, dated September 18, 2013 by and among
                 Spire Corporation, Spire Biomedical, Inc. and N2 Biomedical LLC.


* The schedules and exhibits to the Asset Purchase Agreement are not being filed herewith. The Asset Purchase Agreement contains a list briefly identifying the contents of the schedules and exhibits to such document. The Registrant undertakes to furnish supplementally a copy of any omitted schedule and exhibit to the Securities and Exchange Commission upon request.


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