| Item 1.01 | Entry into a Material Definitive Agreement |
As previously disclosed in the press release of Revolution Lighting Technologies, Inc. (the “Company”) issued on October 19, 2018 and in its amended Current Report on Form8-K/A filed on November 13, 2018 (the “November 13th Form8-K”), Robert V. LaPenta, Sr., the Company’s Chairman and CEO, has funded and has informed the Company that he intends to continue to fund the Company through continued periodic loans to the extent consistent with what he believes to be the best interests of the Company and its stockholders.
On November 15, 2018, the Company entered into a promissory note with Mr. LaPenta (the “Note”), pursuant to which he lent the Company an additional $1 million. The Note was part of the $2.5 million in expected additional loans from Mr. LaPenta disclosed in the November 13th Form8-K.
The Audit Committee of the Company’s Board of Directors approved the terms of the Note on November 14, 2018. Subject to specified exceptions, amounts outstanding under the Note bear interest from the date of advance at a rate per annum equal toone-month LIBOR plus 3.75%, calculated on the basis of a360-day year and the actual number of days elapsed. The principal and interest are payable upon maturity. The Note matures on July 20, 2020. If Mr. LaPenta makes additional short-term advances to the Company that are not repaid within 90 days, the Note may be amended in the Company’s discretion to include the amount of any such advances.
The Note contains customary events of default, including nonpayment of principal or interest when due; assignment without consent of the lender; or the occurrence of certain bankruptcy, insolvency or liquidation-related events. Upon the occurrence of an event of default, any outstanding amounts under the Note may be accelerated; provided, however, that upon the occurrence of certain bankruptcy, insolvency or liquidation-related events of default, all amounts payable under the Note will automatically become immediately due and payable. The Note does not contain financial or restrictive covenants.
As previously disclosed in the November 13th Form8-K, the Company continues to work with its existing bank lender to restructure its debt.
The foregoing description of the Note is not complete and is qualified in its entirety by reference to the full text of the Note, which is attached to this Form8-K as Exhibit 99.1 and is incorporated herein by reference.
| Item 3.01. | Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing. |
On November 15, 2018, the Company received a notification from the Nasdaq Stock Market (“Nasdaq”) informing the Company that since it has not yet filed its Quarterly Report on Form10-Q for the fiscal quarter ended September 30, 2018 (the “Quarterly Report”), the Company is not in compliance with Nasdaq Listing Rule 5250(c)(1) (the “Listing Rule”). The Listing Rule requires listed companies to timely file all required periodic financial reports with the Securities and Exchange Commission (“SEC”). The Nasdaq notification letter specifies that the Company has 60 calendar days, or until January 14, 2019, to submit a plan to regain compliance with the Listing Rule. If Nasdaq accepts a plan from the Company, Nasdaq can grant an exception of up to 180 calendar days from the Quarterly Report’s due date, or until May 8, 2019, to regain compliance. The Company’s common stock will continue to trade on the Nasdaq Capital Market pending Nasdaq’s review of the Company’s plan to regain compliance.
