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SUBSEQUENT EVENTS (Notes)
3 Months Ended
Sep. 30, 2014
Subsequent Events [Abstract]  
Subsequent Events [Text Block]
SUBSEQUENT EVENTS
Note Payable - Related Party
On October 13, 2014, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with FBC Holdings S.à r.l. (the “Lender”), the majority shareholder of the Company and an affiliate of Cyrus Capital Partners, L.P. Pursuant to the Loan Agreement, the Lender loaned to the Company $7.5 million (the “Loan”). The Loan is scheduled to mature on the second anniversary of the funding date of the Loan; provided, however, that if the closing of the proposed merger between the Company and Sphere SD does not occur prior to January 12, 2015, the Company shall be required to pay the Loan in full on such date, together with all accrued and unpaid interest thereon. Outstanding principal under the Loan will bear interest at 8.0% simple interest per annum, payable semi-annually in arrears on the last day of June and December of each year.
On October 14, 2014, the Company paid $2.5 million of the Company’s outstanding note payable to Sphere 3D.
Amendment to Merger Agreement
On October 13, 2014, the Company entered into an Amendment to Agreement and Plan of Merger (the “Amendment to the Merger Agreement”) with Sphere 3D. Pursuant to the Amendment to the Merger Agreement, Sphere 3D consented to the entry by the Company into the Loan Agreement with the Lender and the completion of the transactions contemplated thereby. Sphere 3D additionally agreed to guaranty $2.5 million in principal amount of the Loan as described above and to permit the Company to transfer 25,000 shares of common stock of Sphere 3D to the holders of the existing convertible notes issued by the Company (all of which are affiliates of the Lender) as a fee for waiving the debt and lien restrictions under such convertible notes.
In exchange for the consent of Sphere 3D to the entry by the Company into the Loan Agreement and the issuance of shares of common stock by Sphere pursuant to the Conversion and the Waiver Issuance, the Company agreed in the Amendment to the Merger Agreement to reduce the Exchange Ratio from 0.510594 to 0.46385, subject to adjustment in certain circumstances.