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 15, 2000 (February 7, 2000)
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AIRPORT SYSTEMS INTERNATIONAL, INC.
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(Exact name of registrant as specified in its charter)
KANSAS 0-22760 48-1099142
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
11300 West 89th Street, Overland Park, Kansas 66214
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including (913)-495-2614
area code
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Not applicable
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(Former name or former address, if changed since last report)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On February 7, 2000, Airport Systems International, Inc., a Kansas
corporation ("ASII"), acquired all of the issued and outstanding shares of
common stock, $1.00 par value per share, and certain intangible assets
relating to DCI, Inc., a Kansas corporation ("DCI"), from its stockholders,
Chris I. Hammond, Larry C. Klusman and William D. Cook (the "Sellers"). DCI
is an electrical contract manufacturing company. ASII intends to continue
the operations of DCI.
ASII paid $1,234,000 in cash, issued 150,000 shares of its common stock
and delivered a four-year promissory note in the amount of $1,248,000 in
consideration for the common stock and intangible assets acquired from Sellers.
The total consideration for the acquisition from the Sellers was $2,819,500,
plus the assumption of certain debt owed by DCI.
Immediately following the acquisition of the common stock and intangible
assets of DCI, DCI acquired certain assets of KHC of Lenexa, L.L.C., a Kansas
limited liability company ("KHC"). KHC was owned by the Sellers and had a
leasehold interest in certain real property that was the subject of City of
Lenexa, Kansas Variable Rate Demand Industrial Development Revenue Bonds (DCI
Project) Series 1998 totaling $2,570,000 and other related documents (the "IRB
Documents"). DCI paid $1,290,000 in cash as consideration for the assets
acquired from KHC. DCI also assumed certain liabilities and obligations related
to the IRB Documents.
The asset and stock acquisitions were financed through a Loan and Security
Agreement entered into by and among ASII, DCI and Bank of America, N.A. ("BOA")
as of February 7, 2000, providing, among other things, a revolving loan in the
amount of $8,000,000, term loans from BOA in the amount of $1,178,000 and an
irrevocable direct-pay letter of credit facility in the amount of $2,599,572.60.
On February 7, 2000, ASII also entered into a financing arrangement with
KCEP Ventures II, L.P., a Kansas limited partnership ("KCEP"). In connection
with this arrangement, ASII sold and issued to KCEP 198,413 shares of ASII
common stock for $500,000 ($2.52 per share), a convertible subordinated
debenture in an amount of $500,000 with a conversion price of $3.00 per share,
and a warrant granting KCEP the right to purchase 45,635 shares of ASII common
stock for $150,595.50 ($3.30 per share). ASII plans to use the proceeds from the
sale of the securities for general working capital purposes and to fund
potential future acquisitions in the electrical contract manufacturing business.
The Stock Purchase Agreement with Sellers, the Asset Purchase Agreement
with KHC, the Investment Agreement with KCEP, the Loan and Security Agreement
with BOA and the press release issued by ASII in connection with the acquisition
and financing are filed as exhibits to this report and are incorporated herein
by reference. The description of the acquisition and financing set forth herein
does not purport to be complete and is qualified by the provisions of the
agreements noted above and attached hereto.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) FINANCIAL STATEMENTS. Financial statements and pro forma
financial information will be filed by amendment within the required
reporting period.
(c) EXHIBIT. The following exhibits are filed herewith:
10.1 Asset Purchase Agreement, dated as of January 10, 2000, by
and among Airport Systems International, Inc., KHC of
Lenexa, L.L.C., Chris I. Hammond, Larry C. Klusman and
William D. Cook.
10.2 Stock Purchase Agreement, dated as of January 10, 2000, by
and among Airport Systems International, Inc., DCI, Inc.,
Chris I. Hammond, Larry C. Klusman and William D. Cook.
10.3 Investment Agreement, dated February 7, 2000, by and
between KCEP Ventures II, L.P. and Airport Systems
International, Inc.
10.4 Loan and Security Agreement, dated February 7, 2000, by and
among Airport Systems International, Inc., DCI, Inc. and
Bank of America, N.A.
10.5 Registration Rights Agreement, dated February 7, 2000, by and
among Airport Systems International, Inc., Chris I. Hammond,
Larry C. Klusman and William D. Cook.
10.6 Investor's Rights Agreement, dated February 7, 2000, by and
among Airport Systems International, Inc. and KCEP
Ventures II, L.P.
10.7 10% Convertible Subordinated Debenture, due February 7, 2005,
dated February 7, 2000.
10.8 Warrant
10.9 Letter of Credit, Loan and Security Agreement, dated
February 7, 2000, by and among Airport Systems International,
Inc., DCI, Inc. and Bank of America, N.A.
99.1 Press Release dated February 8, 2000.
SIGNATURE
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.
Date: February 15, 2000
AIRPORT SYSTEMS INTERNATIONAL, INC.
By:/s/ Thomas C. Cargin
Thomas C. Cargin, Vice President
of Finance and Administration,
Secretary and Principal
Accounting Officer