sec document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) August 2, 2005
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SL INDUSTRIES, INC.
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(Exact name of registrant as specified in charter)
NEW JERSEY 1-4987 21-0682685
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
520 Fellowship Road, Suite A114, Mount Laurel, New Jersey 08054
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (856) 727-1500
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N/A
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(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 (see General Instruction A.2. below):
|_| 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.
Revolving Credit Facility
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On August 3, 2005, the registrant and certain of its subsidiaries
entered into a revolving credit facility with Bank of America, N.A. (the
"Revolving Credit Facility") to replace the existing the financing arrangement
among the registrant, certain of its subsidiaries and LaSalle Business Credit,
LLC, as set forth in the Loan and Security Agreement dated January 6, 2003
("LaSalle Facility"). See Item 1.02 below for a complete discussion of the
termination of the LaSalle Facility on August 2, 2005. The Revolving Credit
Facility, with a standby and commercial letter of credit sub-limit of
$5,000,000, provides for borrowings of $25,000,000, and under certain
circumstances for maximum borrowings of $30,000,000. The Revolving Credit
Facility expires on June 30, 2008. Borrowings under the Revolving Credit
Facility bear interest, at the registrant's option, at the London interbank
offering rate ("LIBOR") plus 0.90% to 1.9%, or a base rate, plus a margin rate
ranging from 0% to 0.5%, which is the higher of (i) the Federal Funds rate plus
0.5% or (ii) Bank of America, N.A.'s publicly announced prime rate. The margin
rates are based on certain leverage ratios, as provided in the loan documents.
The registrant is subject to compliance with certain financial covenants set
forth in the Revolving Credit Facility, including a maximum ratio to total
funded debt to EBITDA, minimum levels of interest coverage and net worth and
limitation on capital expenditures, as defined.
Grant of Option
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On August 4, 2005, the registrant announced the appointment of
Eugene J. Ruddy as President of its wholly owned subsidiary, Condor D.C. Power
Supplies, Inc. As part of Mr. Ruddy's compensation, the registrant granted him
options to purchase 25,000 shares of the registrant's common stock, par value
$.20 per share, at an exercise price of $17.01 per share (the "Options"). The
Options vest 25% on August 1, 2005 and 25% on each of the next three
anniversaries of August 1, 2005. The Options expire on August 4, 2009.
For additional information, reference is made to the press release
attached hereto as EXHIBIT 99.01, which is incorporated herein by reference.
ITEM 1.02 TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT.
On August 2, 2005, the LaSalle Facility was terminated. The LaSalle
Facility provided for a revolving loan and two term loans, up to a total maximum
indebtedness of $20,000,000. The revolving loan of up to $16,810,000 was based
upon eligible receivables and inventory, as well as an overadvance amount of
$1,500,000. The overadvance amount was fully paid down on April 7, 2004. The two
term loans of $2,350,000 and $840,000 were being paid down over the three-year
term. The registrant was subject to an early termination charge of $184,981.30.
The total amount that the registrant paid in connection with the termination of
the LaSalle Facility was $2,520,231.39.
ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN
OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
See Item 1.01-Entry into Material Definitive Agreement, discussing
the Revolving Credit Agreement, by and among the registrant, certain
subsidiaries of the registrant and Bank of America, N.A., dated August 3, 2005.
ITEM 8.01 OTHER EVENTS
On August 4, 2005 the registrant issued a press release announcing
the appointment of Eugene J. Reddy as President of Condor and the issuance of
the Options in connection with his appointment. The registrant also announced
the appointment of Salvatore V. Ronchetti, the former President of Condor, as
Executive Vice President of the registrant's Power Electronics Group.
For additional information, reference is made to the press release
attached hereto as EXHIBIT 99.01 and incorporated herein by reference.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
Exhibit No. Description
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99.01 Press release of SL Industries, Inc. dated August
4, 2005.
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.
SL INDUSTRIES, INC.
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(Registrant)
Date: August 8, 2005
By: /s/ David R. Nuzzo
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Name: David R. Nuzzo
Title: Vice President and Chief
Financial Officer