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): FEBRUARY 7, 2007
L-1 IDENTITY SOLUTIONS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 000-21559 04-3320515
(State or other jurisdiction of (Commission (I.R.S. employer
incorporation) file number) identification no.)
177 BROAD STREET, STAMFORD, CONNECTICUT 06901
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (203) 504-1100
NOT APPLICABLE
(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:
[ ] 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 A MATERIAL DEFINITIVE AGREEMENT.
As disclosed in the Current Report on Form 8-K filed on November 16,
2006 by L-1 Identity Solutions, Inc. (the "Company"), on November 15, 2006, the
Company and 6653375 Canada Inc., a corporation incorporated under the Canada
Business Corporations Act (the "CBCA") and a wholly owned subsidiary of the
Company ("Merger Sub"), entered into an Arrangement Agreement (the "Arrangement
Agreement") with ComnetiX Inc., a corporation incorporated under the CBCA
("ComnetiX"), to acquire all of the outstanding capital stock of ComnetiX for US
$0.82 per share, for a total purchase price of approximately US $12.5 million in
cash. The acquisition (the "Arrangement") is structured as an arrangement under
the CBCA with ComnetiX surviving as a wholly-owned subsidiary of the Company. As
discussed in the Current Reports on Form 8-K filed January 11, 2007 and January
29, 2007 by the Company, the Company and Merger Sub entered into two successive
amendments to the Arrangement Agreement with ComnetiX, whereby the Company
increased the total purchase price offered to the shareholders of ComnetiX.
On February 7, 2007, the Company and Merger Sub entered into Amendment
No. 3 to the Arrangement Agreement (the "Third Amendment"), whereby the Company
increased to US $1.17 per share the amount that the Company will pay to the
shareholders of ComnetiX for all of the issued and outstanding shares of
ComnetiX, for a total purchase price of approximately US $17.8 million. The
shareholders and warrant holders of ComnetiX approved the Company's acquisition
of ComnetiX pursuant to the Arrangement Agreement, as amended, at a special
meeting held on February 8, 2007. Under the terms of the Third Amendment,
ComnetiX agreed that it would apply to the Ontario Superior Court for a final
order approving the Arrangement (the "Final Order") no later than February 16,
2007, and that it will use its reasonable best efforts to obtain the Final Order
no later than February 16, 2007. ComnetiX also agreed that it would file the
required articles of arrangement as soon as practicable after obtaining the
Final Order and in any case within two business days of obtaining the Final
Order.
The foregoing description of the Arrangement and the amendments to the
Arrangement Agreement are qualified by reference to the Arrangement Agreement,
and the amendments to the Arrangement Agreement. Copies of the Arrangement
Agreement, the First Amendment and the Second Amendment were each attached as
Exhibit 2.1 to the Current Reports on Form 8-K filed by the Company on November
16, 2006, January 9, 2007 and January 29, 2007, respectively, and are
incorporated herein by reference. A copy of the Third Amendment is attached
hereto as Exhibit 2.1 and is incorporated herein by reference.
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On February 9, 2007, the Company issued a press release announcing its financial
results for the fourth fiscal quarter and year ended December 31, 2006, and
conducted a conference call to discuss its operating results. A copy of the
press release is furnished herewith as Exhibit 99.2. A transcript of the
conference call is furnished herewith as Exhibit 99.3.
2
The information furnished pursuant to Items 2.02 and 7.01 of this Current Report
on Form 8-K, including the related exhibits hereto, shall be deemed to be
"filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as
amended, or otherwise subject to the liabilities of that section of Sections 11
and 12(a)(2) of the Securities Act of 1933, as amended. The information
contained herein and in the accompanying Exhibits 99.1, 99.2 and 99.3 shall not
be incorporated by reference into any registration statement or other document
filed with the Securities and Exchange Commission by the Company, whether made
before or after the date hereof, regardless of any general incorporation
language in such filing, except as shall be expressly set forth by specific
reference in such filing.
The information furnished in the press release attached as Exhibit 99.2 and the
conference call transcribed in Exhibit 99.3 makes reference to certain non-GAAP
financial measures, including adjusted EBITDA and unlevered free cash flow. The
Company considers adjusted EBITDA to be an important indicator of the Company's
operational strength and a useful measure of the Company's historical operating
trends. The Company believes unlevered free cash flow is a useful measure for
assuming the Company's liquidity, ability to meet its debt service requirements
and make acquisitions. However, this additional non-GAAP financial information
is not meant to be considered in isolation or as a substitute for, in the case
of adjusted EBITDA, operating profit, operating margin, net income, diluted
earnings per share, or cash and cash equivalents or, in the case of unlevered
free cash flow, cash flows from operating activities, in each case prepared in
accordance with GAAP. Reconciliations of adjusted EBITDA to GAAP net income and
unlevered free cash flow to cash flow from operating activities contained in the
attached press release.
ITEM 7.01. REGULATION FD DISCLOSURE.
On February 9, 2007, the Company issued a press release announcing the approval
by ComnetiX's shareholders and warrant holders of the acquisition of ComnetiX by
the Company pursuant to the Arrangement Agreement, as amended, as described in
Item 1.01 above. A copy of the press release is furnished as Exhibit 99.1.
On February 9, 2007, the Company also issued a press release announcing its
financial results for the fourth fiscal quarter and year ended December 31,
2006, and conducted a conference call to discuss its operating results. A copy
of the press release announcing financial results and a transcript of the
conference call are furnished as Exhibits 99.2 and 99.3, respectively.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits.
Exhibit 2.1 Amendment No. 3 to Arrangement Agreement, dated February 7,
2007, among L-1 Identity Solutions, Inc., 6653375 Canada
Inc. and Comnetix Inc.
Exhibit 99.1 Press Release issued February 9, 2007 titled "ComnetiX
Shareholders Approve Purchase by L-1 Solutions"
Exhibit 99.2 Press Release issued February 9, 2007 titled "L-1 Identity
Solutions Achieves Solid Fourth Quarter and Full Year
Financial Results for 2006".
Exhibit 99.3 Transcript of conference call conducted by the Company on
February 9, 2007.
3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: February 12, 2007
L-1 IDENTITY SOLUTIONS, INC.
By: /s/ Robert V. LaPenta
-------------------------------------
Robert V. LaPenta
Chairman of the Board, President &
Chief Executive Officer
5
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
Exhibit 2.1 Amendment No. 3 to Arrangement Agreement, dated February 7,
2007, among L-1 Identity Solutions, Inc., 6653375 Canada
Inc. and Comnetix Inc.
Exhibit 99.1 Press Release issued February 9, 2007 titled "ComnetiX
Shareholders Approve Purchase by L-1 Solutions"
Exhibit 99.2 Press Release issued February 9, 2007 titled "L-1
Identity Solutions Achieves Solid Fourth Quarter and Full
Year Financial Results for 2006".
Exhibit 99.3 Transcript of conference call conducted by the Company on
February 9, 2007.
6