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) March 17, 2010
ClearPoint
Business Resources, Inc.
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(Exact
name of registrant as specified in its
charter)
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(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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1600
Manor Drive, Suite 110, Chalfont, PA 18914
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(Address
of principal executive offices) (Zip
Code)
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Registrant’s
telephone number, including area code (215)
997-7710
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(Former
name or former address, if changed since last
report)
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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):
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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))
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Item
2.04
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Triggering
Events That Accelerate or Increase a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet
Arrangement.
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ClearPoint
Business Resources, Inc. (the “Company”) has previously disclosed in its reports
filed with the Securities and Exchange Commission that the Company entered into
a Loan Modification and Restructure Agreement dated June 20, 2008 (the
“Restructure Agreement”) with Manufacturers and Traders Trust Company
(“M&T”), pursuant to which the parties agreed to consolidate certain amounts
owed by the Company to M&T and to permit the Company to repay such amounts
(the “Deferred Obligations”) on a deferred basis. The Deferred
Obligations were initially $3 million.
In
addition to repayment of the Deferred Obligations, the Restructure Agreement
provides that the Company must pay M&T cash proceeds arising out of certain
of its and its subsidiaries’ accounts receivable (the “Accounts”) in an amount
not less than $3 million prior the earlier of the Company’s full satisfaction of
its obligations owed to ComVest Capital, LLC (“ComVest”) or January 1,
2011. In the event M&T receives less than $3 million of proceeds
arising out of the Accounts, the shortfall will be added to and deemed part of
the Deferred Obligations. The terms of the Restructure Agreement
provide that upon the occurrence of a default in the due observance or
performance of any covenant, condition or agreement which, if capable of being
cured, is not fully cured within thirty days after the occurrence thereof, and
at all times thereafter during the continuance thereof, all Deferred Obligations
shall be accelerated and become immediately due and payable. As of
March 17, 2010, the Deferred Obligations were approximately $3.1 million, with
approximately $1.5 million due to M & T in connection with proceeds arising
out of the Accounts.
On March
17, 2010, the Company received a letter from M&T (the “M&T Letter”) in
connection with the Restructure Agreement. The M&T Letter states
that it serves as a notice of existence of events of default under the
Restructure Agreement, including the Company’s failure to comply with its
covenant to collect the Accounts, the Company’s failure to deliver certain
financial information to M&T and the existence of events of default under
the Company’s Amended and Restated Loan Agreement (the “Loan Agreement”) with
ComVest. In addition, M&T requested an explanation of the
Company’s efforts to collect the Accounts, evidence that remittances from the
Accounts were applied in accordance with the Restructure Agreement and copies of
all information furnished to ComVest pursuant to the Loan
Agreement. The M&T Letter further provides that all of its
rights, benefits and security against the Company in connection with such
alleged defaults, including the right to accelerate the Deferred Obligations,
are reserved.
An event
of default under the Restructure Agreement would trigger a cross-default
provision pursuant to the Loan Agreement with ComVest, unless such default is
waived in writing by ComVest. If the cross-default provision is
triggered, ComVest may, among other things, declare all outstanding obligations
under the Loan Agreement to be immediately due and payable. As of
March 17, 2010, the Company’s outstanding obligations under the Loan Agreement
with ComVest were approximately $10.4 million, in addition to interest fees
of approximately $1.1 million.
The
Company’s obligations to M&T are subordinated to its obligations to ComVest
pursuant to a Subordination and Intercreditor Agreement dated June 20, 2008
between ComVest and M&T. The Company is currently discussing the
M&T Letter with M&T.
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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CLEARPOINT
BUSINESS RESOURCES, INC.
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By:
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/s/
John G. Phillips
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Name:
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John
G. Phillips
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Title:
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Chief
Financial Officer
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Date: March
23, 2010