0000921895-16-004150.txt : 20160418 0000921895-16-004150.hdr.sgml : 20160418 20160418152442 ACCESSION NUMBER: 0000921895-16-004150 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20160418 DATE AS OF CHANGE: 20160418 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CROSSROADS SYSTEMS INC CENTRAL INDEX KEY: 0001093207 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 742846643 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-57603 FILM NUMBER: 161576815 BUSINESS ADDRESS: STREET 1: 11000 NORTH MOPAC EXPRESSWAY CITY: AUSTIN STATE: TX ZIP: 78759 BUSINESS PHONE: 5123490300 MAIL ADDRESS: STREET 1: 11000 NORTH MOPAC EXPRESSWAY STREET 2: . CITY: AUSTIN STATE: TX ZIP: 78759 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Lone Star Value Management LLC CENTRAL INDEX KEY: 0001589350 IRS NUMBER: 462567817 STATE OF INCORPORATION: CT FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 53 FOREST AVENUE, 1ST FLOOR CITY: OLD GREENWICH STATE: CT ZIP: 06870 BUSINESS PHONE: (203) 542-0235 MAIL ADDRESS: STREET 1: 53 FOREST AVENUE, 1ST FLOOR CITY: OLD GREENWICH STATE: CT ZIP: 06870 SC 13D/A 1 sc13da809482029_04182016.htm AMENDMENT NO. 8 TO THE SCHEDULE 13D sc13da809482029_04182016.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13D
(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
§ 240.13d-2(a)

(Amendment No. 8)1

Crossroads Systems, Inc.
(Name of Issuer)

Common Stock, par value $0.001 per share
(Title of Class of Securities)

22765D209
(CUSIP Number)
 
JEFFREY E. EBERWEIN
LONE STAR VALUE MANAGEMENT, LLC
53 Forest Avenue, 1st Floor
Old Greenwich, Connecticut 06870
(203) 489-9500
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

April 11, 2016
(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box ¨.

Note:  Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits.  See § 240.13d-7 for other parties to whom copies are to be sent.


_______________
1              The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
 
 
 
 
CUSIP NO. 22765D209
 
1
NAME OF REPORTING PERSON
 
LONE STAR VALUE INVESTORS, LP
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) x
3
SEC USE ONLY
 
4
SOURCE OF FUNDS
 
WC
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
 
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
 
DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
 
5,564,145*
8
SHARED VOTING POWER
 
- 0 -
9
SOLE DISPOSITIVE POWER
 
5,564,145*
10
SHARED DISPOSITIVE POWER
 
- 0 -
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
5,564,145*
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
 
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
19.99%*
14
TYPE OF REPORTING PERSON
 
PN
____________________
* Includes 984,567 Shares underlying currently exercisable Warrants; however, the Warrants are subject to a 19.99% blocking provision, meaning that they can be exercised only to the extent that such exercise would not cause the holder’s beneficial ownership of Shares to exceed 19.99%.
 
 
2
 
CUSIP NO. 22765D209
 
1
NAME OF REPORTING PERSON
 
LONE STAR VALUE INVESTORS GP, LLC
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) x
3
SEC USE ONLY
 
4
SOURCE OF FUNDS
 
AF
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
 
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
 
DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
 
5,564,145*
8
SHARED VOTING POWER
 
- 0 -
9
SOLE DISPOSITIVE POWER
 
5,564,145*
10
SHARED DISPOSITIVE POWER
 
- 0 -
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
5,564,145*
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
 
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
19.99%*
14
TYPE OF REPORTING PERSON
 
OO
____________________
* Includes 984,567 Shares underlying currently exercisable Warrants; however, the Warrants are subject to a 19.99% blocking provision, meaning that they can be exercised only to the extent that such exercise would not cause the holder’s beneficial ownership of Shares to exceed 19.99%.
 
 
3
 
CUSIP NO. 22765D209
 
1
NAME OF REPORTING PERSON
 
LONE STAR VALUE MANAGEMENT, LLC
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) x
3
SEC USE ONLY
 
4
SOURCE OF FUNDS
 
AF, OO
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
 
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
 
CONNECTICUT
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
 
5,764,145*
8
SHARED VOTING POWER
 
- 0 -
9
SOLE DISPOSITIVE POWER
 
5,764,145*
10
SHARED DISPOSITIVE POWER
 
- 0 -
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
5,764,145*
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
 
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
19.99%*
14
TYPE OF REPORTING PERSON
 
OO
____________________
* Includes 984,567 Shares underlying currently exercisable Warrants; however, the Warrants are subject to a 19.99% blocking provision, meaning that they can be exercised only to the extent that such exercise would not cause the holder’s beneficial ownership of Shares to exceed 19.99%.
 
 
4
 
CUSIP NO. 22765D209
 
1
NAME OF REPORTING PERSON
 
JEFFREY E. EBERWEIN
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) x
3
SEC USE ONLY
 
4
SOURCE OF FUNDS
 
AF, PF
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
 
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
 
USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
 
5,827,909#*
8
SHARED VOTING POWER
 
-0-
9
SOLE DISPOSITIVE POWER
 
5,827,909#*
10
SHARED DISPOSITIVE POWER
 
-0-
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
5,827,909#*
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
 
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
19.99%#*
14
TYPE OF REPORTING PERSON
 
IN
 
____________________
# Includes 63,764 Shares beneficially owned directly by Mr. Eberwein, including 29,620 Shares underlying certain call options exercisable within 60 days of the date hereof.
 
* Includes 984,567 Shares underlying currently exercisable Warrants; however, the Warrants are subject to a 19.99% blocking provision, meaning that they can be exercised only to the extent that such exercise would not cause the holder’s beneficial ownership of Shares to exceed 19.99%.
 
 
5
 
CUSIP NO. 22765D209
 
The following constitutes Amendment No. 8 to the Schedule 13D filed by the undersigned (“Amendment No. 8”).  This Amendment No. 8 amends the Schedule 13D as specifically set forth herein.
 
Item 3.
Source and Amount of Funds or Other Consideration.
 
Item 3 is hereby amended and restated to read as follows:
 
The Shares and Warrants purchased by Lone Star Value Investors  and held in a certain account managed by Lone Star Value Management (the “Lone Star Value Account”) were purchased with working capital (which may, at any given time, include margin loans made by brokerage firms in the ordinary course of business) in open market purchases, except as otherwise noted. The aggregate purchase price of the 4,579,578 Shares directly owned by Lone Star Value Investors is approximately $7,786,754, including brokerage commissions, of which of 1,526,526 Shares were acquired pursuant to the Issuer’s Rights Offering and 1,288,352 Shares that were purchased in a private placement by the Issuer on March 31, 2014 (the “Private Placement”). In addition, 644,176 of the Warrants exercisable into 984,567 Shares beneficially owned by Lone Star Value Investors were acquired in the Private Placement, and the remaining 175,000 were acquired in the Issuer's secondary offering in January 2015, and the remaining 165,391 warrants were issued by the Company in consideration of the Common Stock outstanding increasing by 3,933,879 to 23,418,989. The aggregate purchase price of the 200,000 Shares held in the Lone Star Value Account is approximately $274,903, including brokerage commissions.
 
The Shares purchased by Mr. Eberwein were acquired with personal funds. The aggregate purchase price of the 34,144 Shares directly owned by Mr. Eberwein is approximately $51,781, excluding brokerage commissions, of which 22,763 Shares were acquired pursuant to the exercise of options granted to Mr. Eberwein for his service as the Chairman of the Issuer’s Board of Directors (the “Board”) and 11,381 Shares were acquired in the Rights Offering. In addition, Mr. Eberwein beneficially owns 29,620 Shares underlying certain call options that were granted to him in connection with his service as Chairman of the Board.

Item 4.
Purpose of Transaction.
 
Item 4 is hereby amended to add the following:

On April 11, 2016, the Issuer announced that Mr. Eberwein, the Chairman of the Board of the Issuer, has determined not to stand for re-election at the Issuer’s 2016 annual meeting of stockholders (the “Annual Meeting”); however, Mr. Eberwein will continue his involvement with the Issuer and has been granted observer status with the Board following the Annual Meeting. The Issuer also announced that Hannah M. Bible, the director of operations and in-house counsel of Lone Star Value Management, has been nominated by the Board for election as a director at the Annual Meeting to fill the resulting vacancy.
 
Item 5.
Interest in Securities of the Issuer.
 
Items 5(a)-(c) are hereby amended and restated to read as follows:
 
The aggregate percentage of Shares reported owned by each person named herein is based upon 24,509,435 Shares outstanding as reported in the Issuer’s preliminary proxy statement on Schedule 14A filed with the Securities and Exchange Commission on April 11, 2016.
 
A.
Lone Star Value Investors
 
 
(a)
As of the close of business on April 15, 2016, Lone Star Value Investors beneficially owned 5,564,145 Shares, including 984,567 Shares underlying currently exercisable Warrants; however, the Warrants can only be exercised to the extent that such exercise would not cause Lone Star Value Investors’ beneficial ownership of Shares to exceed 19.99% due to blocker provisions.
 
Percentage: Approximately 19.99%
 
 
6
 
CUSIP NO. 22765D209
 
 
(b)
1. Sole power to vote or direct vote: 5,564,145
 
2. Shared power to vote or direct vote: 0
 
3. Sole power to dispose or direct the disposition: 5,564,145
 
4. Shared power to dispose or direct the disposition: 0

 
(c)
Lone Star Value Investors has not entered into any transactions in the Shares during the past sixty days.
 
B.
Lone Star Value GP
 
 
(a)
Lone Star Value GP, as the general partner of Lone Star Value Investors, may be deemed the beneficial owner of the 5,564,145 Shares beneficially owned by Lone Star Value Investors.
 
Percentage: Approximately 19.99%
 
 
(b)
1. Sole power to vote or direct vote: 5,564,145
 
2. Shared power to vote or direct vote: 0
 
3. Sole power to dispose or direct the disposition: 5,564,145
 
4. Shared power to dispose or direct the disposition: 0

 
(c)
Lone Star Value GP has not entered into any transactions in the Shares during the past sixty days.
 
C.
Lone Star Value Management
 
 
(a)
As of the close of business on April 15, 2016, 200,000 Shares were held in the Lone Star Value Account. Lone Star Value Management, as the investment manager of Lone Star Value Investors and the Lone Star Value Account, may be deemed the beneficial owner of the (i) 5,564,145 Shares beneficially owned by Lone Star Value Investors and (ii) 200,000 Shares held in the Lone Star Value Account.
 
Percentage: Approximately 19.99%
 
 
(b)
1. Sole power to vote or direct vote: 5,764,145
 
2. Shared power to vote or direct vote: 0
 
3. Sole power to dispose or direct the disposition: 5,764,145
 
4. Shared power to dispose or direct the disposition: 0

 
(c)
Lone Star Value Management has not entered into any transactions in the Shares during the past sixty days.  
 
D.
Mr. Eberwein
 
 
(a)
As of the close of business on April 15, 2016, Mr. Eberwein beneficially owned directly 63,764 Shares, including 29,620 Shares underlying certain call options exercisable within 60 days of the date hereof. Mr. Eberwein, as the manager of Lone Star Value GP and sole member of Lone Star Value Management, may be deemed the beneficial owner of the (i) 5,564,145 Shares beneficially owned by Lone Star Value Investors and (ii) 200,000 Shares held in the Lone Star Value Account.
 
Percentage: Approximately 19.99%
 
 
(b)
1. Sole power to vote or direct vote: 5,827,909
 
2. Shared power to vote or direct vote: 0
 
3. Sole power to dispose or direct the disposition: 5,827,909
 
4. Shared power to dispose or direct the disposition: 0

 
(c)
Mr. Eberwein has not entered into any transactions in the Shares during the past sixty days.
 
 
7
 
CUSIP NO. 22765D209
 
In the event that the Warrants did not include the 19.99% blocker provision, (i) Lone Star Value Investors and Lone Star Value GP would beneficially own approximately 21.8% of the outstanding Shares, (ii) Lone Star Value Management would beneficially own approximately 22.6% of the outstanding Shares and (iii) Mr. Eberwein would beneficially own approximately 22.8% of the outstanding Shares.
 
The Reporting Persons, as members of a “group” for the purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, may be deemed the beneficial owner of the Shares directly owned by the other Reporting Person.  Each Reporting Person disclaims beneficial ownership of such Shares except to the extent of his or its pecuniary interest therein.
 
 
8
 
CUSIP NO. 22765D209
 
SIGNATURES
 
After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.
 
Dated:  April 18, 2016
 
 
Lone Star Value Investors, LP
   
 
By:
Lone Star Value Investors GP, LLC
General Partner
     
     
 
By:
/s/ Jeffrey E. Eberwein
   
Name:
Jeffrey E. Eberwein
   
Title:
Manager


 
Lone Star Value Investors GP, LLC
   
   
 
By:
/s/ Jeffrey E. Eberwein
   
Name:
Jeffrey E. Eberwein
   
Title:
Manager


 
Lone Star Value Management, LLC
   
   
 
By:
/s/ Jeffrey E. Eberwein
   
Name:
Jeffrey E. Eberwein
   
Title:
Sole Member


 
/s/ Jeffrey E. Eberwein
 
JEFFREY E. EBERWEIN
 
 
 
9