UNITED STATES
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): April 30, 2009
SPARTON CORPORATION
(Exact Name of Registrant as Specified in its Charter)
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Ohio
(State or other jurisdiction
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1-1000
(Commission File Number)
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38-1054690
(IRS Employer |
| of incorporation)
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Identification No.) |
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| 2400 East Ganson Street |
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| Jackson, Michigan
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49202 |
| (Address of Principal Executive Offices)
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(Zip Code) |
Registrant’s telephone number, including area code: (517) 787-8600
N/A
(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:
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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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TABLE OF CONTENTS
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| Item 1.01 |
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Entry into a Material Definitive Agreement |
On April 30, 2009 and effective as of May 1, 2009, Sparton Corporation (the “Company” or “Sparton”)
entered into a Promissory Note Modification Agreement (the “Amendment”) with National City Bank, a
national banking association (the “Lender”), which amends the terms of the existing Promissory Note
dated January 22, 2008 between the Company and the Lender (the “Promissory Note”) and the related
documents. The Promissory Note relates to an $18 million revolving line of credit facility (the
“Line of Credit Loan”) that supports the Company’s working capital needs and other general
corporate purposes. The Line of Credit Loan is secured by substantially all assets of the Company.
The Line of Credit Loan is evidenced by, among other documents, the Promissory Note, as amended by
the Master Amendment to Loan Documents, dated as of April 21, 2008 and effective as of March 31,
2008, by the Second Master Amendment to Loan Documents, dated as of July 31, 2008 and effective as
of June 30, 2008, by the Third Master Amendment to Loan Documents, dated as of November 12, 2008,
and by the Fourth Master Amendment to Loan Documents, dated as of January 20, 2009 (collectively,
the “Line of Credit Loan Documents”).
Pursuant to the Amendment, the terms of the Line of Credit Loan Documents were amended to extend
the maturity date of the Promissory Note from May 1, 2009 to June 15, 2009. The Company also
ratified and confirmed its obligations and liability to the Lender under the Line of Credit Loan
Documents pursuant to the Amendment.
The Line of Credit Loan Documents include representations, covenants and events of default that are
customary for financing transactions of this nature. The Company’s obligations under the Line of
Credit Loan Documents are guaranteed by each of the Company’s subsidiaries, and each guarantee is
secured by all assets of the respective subsidiary.
The foregoing does not constitute a complete summary of the terms of the Amendment and reference is
made to the complete form of the Amendment and the press release that are attached as Exhibit 10.1
and Exhibit 99.1, respectively, to this report and are hereby incorporated by reference.
Sparton entered into a Proposal Letter and Preliminary Term Sheet (the “Term Sheet”) with a
prospective lender (the “Potential Lender”) on April 15,
2009 relating to a potential financing that, if consummated
by the Company and the Potential Lender, would replace the Line of Credit Loan and provide for the
ongoing working capital needs of Sparton. The Term Sheet is non-binding and subject to customary
contingencies, including, but not limited to, the following: (i) completion of satisfactory due
diligence on Sparton; (ii) the negotiation of definitive terms of a commitment letter and credit
agreement; and (iii) no material adverse change in the condition, financial or otherwise, of the
Company’s operations, properties, assets or prospects. There are no assurances that the Potential
Lender will offer a binding commitment letter to Sparton or that the Potential Lender and Sparton
will consummate the prospective financing.