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, 2013
DIALOGIC INC.
(Exact name of registrant as specified in its charter)
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Delaware |
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001-33391 |
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94-3409691 |
(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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1504 McCarthy Boulevard
Milpitas, California |
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95035 |
(Address of principal executive offices) |
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(Zip Code) |
Registrants telephone number, including area code: (408) 750-9400
(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:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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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.
Amendment of Existing Debt Arrangements
On February 7, 2013, Dialogic Corporation, a wholly owned subsidiary of Dialogic Inc. (the Company), entered into a Third Amendment (the Third Amendment) to the Third Amended
and Restated Credit Agreement (the Term Loan Agreement) with Obsidian, LLC, as agent and collateral agent, and Special Value Expansion Fund, LLC, Special Value Opportunities Fund, LLC and Tennenbaum Opportunities Partners V, LP,
as lenders (collectively, the Term Lenders). On February 7, 2013, Dialogic Corporation also entered into a Waiver and Twentieth Amendment ( the Twentieth Amendment) to the Credit Agreement dated as of March 5, 2008,
as amended (the Revolving Credit Agreement), with Wells Fargo Foothill Canada ULC, as administrative agent, and certain lenders (the Revolving Credit Lenders).
Pursuant to the Third Amendment, the Company and the Term Lenders have agreed to provide for additional borrowing of up to $4,000,000
under the Term Loan Agreement. In consideration of this additional borrowing, the Company agreed to issue an amount of common stock to the Term Lenders equal to the market value of 10.0% of the outstanding shares of the common stock of the Company
based on the closing price of the Companys common stock immediately prior to such issuance pursuant to a Subscription Agreement further described below.
Additionally, pursuant to the Third Amendment, the minimum EBITDA financial covenant was amended and its application was postponed until the fiscal quarter ending March 31, 2014. Previously, the
minimum EBITDA financial covenant would have commenced in the fiscal quarter ending June 30, 2013. Pursuant to the Third Amendment, the other financial covenants, including the minimum liquidity covenant, are no longer applicable under the Term
Loan Agreement.
Lastly, the definition of Maturity Date in the Term Loan Agreement was amended to provide that it shall be
extended to March 31, 2016 upon the earlier to occur of (i) the receipt by the Company of Net Equity Proceeds (as defined in the Term Loan Agreement) in an aggregate amount of at least $5,000,000 or (ii) a Change in Control (as
defined in the Term Loan Agreement).
Pursuant to the Twentieth Amendment, the Revolving Credit Agreement was also amended to
postpone the application of the minimum EBITDA financial covenant until the fiscal quarter ending March 31, 2014. Previously, the minimum EBITDA financial covenant would have commenced in the fiscal quarter ending June 30, 2013.
Additionally, pursuant to the Twentieth Amendment, a definition of Availability Block was added to the Credit Agreement in the amount of $500,000, which amount shall increase by an additional $100,000 on July 1, 2013 and on the
first day of each fiscal quarter thereafter. The Revolving Credit Agreement was also amended to reduce the Borrowing Base by the Availability Block at all times.
Other Agreements
In connection with the Third Amendment, the Company
entered into a Subscription Agreement with the Term Lenders dated February 7, 2013 (the Subscription Agreement) whereby the Company agreed to issue to the Term Lenders an amount of common stock equal to the market value of 10.0% of
the outstanding shares of the Company based on the closing bid price immediately prior to such issuance as set out in the Subscription Agreement. On February 7, 2013, a total of 1,442,172 shares of common stock were issued to the Term Lenders
under the terms of the Subscription Agreement.
The Company and the Term Loan Lenders also entered into a Registration Rights
Agreement with the Term Loan Lenders dated February 7, 2013 (the Rights Agreement) pursuant to which the Company agreed to file one or more registration statements registering for resale the shares of common stock issued under the
Subscription Agreement within 90 days of such issuance.
The foregoing descriptions of the Third Amendment, the Twentieth
Amendment, the Subscription Agreement and the Rights Agreement are summaries of the material terms of such agreements, do not purport to be complete and are qualified in their entirety by reference to the Third Amendment, the Twentieth Amendment,
the Subscription Agreement and the Rights Agreement, which are filed as Exhibits 10.2, 10.3, 10.1 and 4.1, respectively, to this current report on Form 8-K and are incorporated by reference herein.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth above and referenced in Item 1.01 that relates to the creation of a direct financial obligation of Dialogic
Corporation under the Third Amendment is incorporated by reference into this Item 2.03.
Item 3.02. Unregistered Sales of Equity Securities.
The information set forth above and referenced under Item 1.01 that relates to the issuance of the sale of common stock hereby
incorporated by reference into this Item 3.02.
The shares of common stock sold pursuant to the Subscription Agreement
were offered and sold to accredited investors, including certain related parties, without registration under the Securities Act of 1933, as amended (the Securities Act), or state securities laws, in reliance on the exemptions provided by
Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit
No. |
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Description |
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4.1 |
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Registration Rights Agreement, dated February 7, 2013, by and among Dialogic Inc. and the buyers signatory thereto. |
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10.1 |
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Subscription Agreement, dated February 7, 2013, by and among Dialogic Inc. and the purchasers identified on the Schedule of Purchasers thereto. |
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10.2 |
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Third Amendment to Third Amended and Restated Credit Agreement, dated February 7, 2013, by and among Dialogic Inc., Dialogic Corporation, Obsidian LLC and the lenders signatory
thereto. |
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10.3 |
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Waiver and Twentieth Amendment to Credit Agreement, dated February 7, 2013, by and among Dialogic Inc., Dialogic Corporation, Wells Fargo Foothill Canada ULC and the lenders
signatory thereto. |
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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DIALOGIC INC. |
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Dated: February 11, 2013 |
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By: |
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/s/ Anthony Housefather |
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Anthony Housefather |
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EVP Corporate Affairs and General Counsel |
EXHIBIT INDEX
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Exhibit
No. |
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Description |
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4.1 |
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Registration Rights Agreement, dated February 7, 2013, by and among Dialogic Inc. and the buyers signatory thereto. |
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10.1 |
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Subscription Agreement, dated February 7, 2013, by and among Dialogic Inc. and the purchasers identified on the Schedule of Purchasers thereto. |
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10.2 |
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Third Amendment to Third Amended and Restated Credit Agreement, dated February 7, 2013, by and among Dialogic Inc., Dialogic Corporation, Obsidian LLC and the lenders signatory
thereto. |
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10.3 |
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Waiver and Twentieth Amendment to Credit Agreement, dated February 7, 2013, by and among Dialogic Inc., Dialogic Corporation, Wells Fargo Foothill Canada ULC and the lenders
signatory thereto. |
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