sec document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): September 30, 2005
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LYNCH CORPORATION
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(Exact Name of Registrant as specified in Charter)
Indiana 1-106 38-1799862
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
140 Greenwich Avenue, 4Th Floor, Greenwich, CT 06830
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (203) 622-1150
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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 MATERIAL DEFINITIVE AGREEMENT.
LOAN AGREEMENT WITH RBC CENTURA BANK.
On September 30, 2005, M-tron Industries, Inc.,("M-tron"), and Piezo
Technology,Inc.,("PTI"), each wholly-owned subsidiaries of Lynch Corporation(the
"Registrant"), entered into a loan agreement(the "Loan Agreement")with RBC
Centura Bank("RBC"), which is filed as Exhibit 10.1 to this Current Report on
Form 8-K. The Loan Agreement provides for a loan in the amount of $3,040,000
(the "Term Loan"), the proceeds of this loan were used to payoff the $3,000,000
bridge loan with First National Bank of Omaha. The Term Loan bears interest at
LIBOR Base Rate plus 2.75% and is to be repaid in monthly installments based on
a twenty year amortization, with the then remaining principal balance to be paid
on the fifth anniversary of the Term Loan. The Term Loan is secured by a
mortgage on PTI's premises. In connection with this Term Loan, PTI entered into
a five-year interest rate swap from which it will receive periodic payments at
the LIBOR Base Rate and make periodic payments at a fixed rate of 7.51% with
monthly settlement and rate reset dates.
The Loan Agreement contains a variety of affirmative and negative covenants
of types customary in an asset-based lending facility, including those relating
to reporting requirements, maintenance of records, properties and corporate
existence, compliance with laws, incurrence of other indebtedness and liens,
restrictions on certain payments and transactions and extraordinary corporate
events. The Loan Agreement also contains financial covenants relating to
maintenance of levels of minimal tangible net worth, total liabilities to
tangible net worth ratio and fixed charge coverage ratio. In addition, the Loan
Agreement provides that the following will constitute events of default
thereunder, subject to certain grace periods: (i)payment defaults; (ii) failure
to meet reporting requirements; (iii) breach of other obligations under the Loan
Agreement; (iv) default with respect to other material indebtedness; (v) final
judgment for a material amount not discharged or stayed; and (vi) bankruptcy or
insolvency.
Pursuant to an Unconditional Guaranty for Payment, filed as Exhibit 10.2 to
this Current Report on Form 8-K, the Registrant guaranteed to RBC the payment of
its subsidiaries' obligations under the Loan Agreement and ancillary agreements
and instruments.
Item 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
EXHIBITS
Number Exhibit
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10.1 Loan Agreement, by and among M-tron, PTI and RBC, dated
September 30, 2005.
10.2 Unconditional Guaranty for Payment with RBC, dated
September 30, 2005
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Current Report on Form 8-K to be signed on its
behalf by the undersigned hereunto duly authorized.
LYNCH CORPORATION
By: /s/ Eugene Hynes
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Eugene Hynes
Vice President
October 04, 2005