Filing Details
- Accession Number:
- 0001193125-19-192394
- Form Type:
- 13D Filing
- Publication Date:
- 2019-07-11 16:01:58
- Filed By:
- Lateral Investment Management, Llc
- Company:
- Fte Networks Inc. (NYSE:FTNW)
- Filing Date:
- 2019-07-11
- SEC Url:
- 13D Filing
Please notice the below summary table is generated without human intervention and may contain errors. Please refer to the complete filing displayed below for exact figures.
Name | Sole Voting Power | Shared Voting Power | Sole Dispositive Power | Shared Dispositive Power | Aggregate Amount Owned Power | Percent of Class |
---|---|---|---|---|---|---|
Lateral Investment Management | 0 | 7,121,042 | 0 | 7,121,042 | 7,121,042 | 29.2% |
Lateral FTE Feeder | 0 | 350,539 | 0 | 350,539 | 350,539 | 1.4% |
Lateral U.S. Credit Opportunities Fund | 0 | 3,908,440 | 0 | 3,908,440 | 3,908,440 | 16.0% |
Niagara Nominee | 0 | 2,166,085 | 0 | 2,166,085 | 2,166,085 | 8.9% |
Lateral Credit Opportunities | 0 | 3,908,440 | 0 | 3,908,440 | 3,908,440 | 16.0% |
Dhamitha Richard de Silva | 0 | 7,121,042 | 0 | 7,121,042 | 7,121,042 | 29.2% |
Patrick Feeney | 0 | 7,121,042 | 0 | 7,121,042 | 7,121,042 | 29.2% |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 5)*
FTE NETWORKS, INC.
(Name of Issuer)
Common Stock, par value $0.001 per share
(Title of Class of Securities)
30283R402
(CUSIP Number)
Dhamitha Richard de Silva, Managing Partner
Lateral Investment Management, LLC
400 South El Camino Real, Suite 1100,
San Mateo, CA 94402
650-396-2200
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)
July 2, 2019
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ☐
Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7(b) for other parties to whom copies are to be sent.
* | The remainder of this cover page shall be filled out for a reporting persons initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. |
The information required on the remainder of this cover page shall not be deemed to be filed for the purpose of Section 18 of the Securities Exchange Act of 1934 (Act) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
CUSIP No. 30283R402 | 13D | Page 2 of 12 Pages |
1 | NAME OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Lateral Investment Management, LLC | |||||
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) ☐ (b) ☒
| |||||
3 | SEC USE ONLY
| |||||
4 | SOURCE OF FUNDS (SEE INSTRUCTIONS)
OO (Shares were issued pursuant to the Credit Agreement, as further described in Item 3.) | |||||
5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ | |||||
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH | 7 | SOLE VOTING POWER
0 | ||||
8 | SHARED VOTING POWER
7,121,042* | |||||
9 | SOLE DISPOSITIVE POWER
0 | |||||
10 | SHARED DISPOSITIVE POWER
7,121,042* |
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,121,042* | |||||
12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ | |||||
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
29.2%** | |||||
14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IA |
* | Each share of Common Stock is presented on this amended Form 13D after giving effect to the 25-for-1 reverse stock split (the Reverse StockSplit) of the Issuer that became effective on November 6, 2017, as disclosed in the Issuers Form 8-K filed on the same date. |
** | Based on an aggregate total of 24,390,743 shares of Common Stock outstanding, comprised of 20,455,262 shares of Common Stock issued and outstanding as of July 2, 2019, as confirmed by the Issuer on July 9, 2019, plus 3,935,481 shares of Common Stock underlying warrants held by the Reporting Persons (all on a post-Reverse Stock Split basis). |
CUSIP No. 30283R402 | 13D | Page 3 of 12 Pages |
1 | NAME OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Lateral FTE Feeder LLC | |||||
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) ☐ (b) ☒
| |||||
3 | SEC USE ONLY
| |||||
4 | SOURCE OF FUNDS (SEE INSTRUCTIONS)
OO (Shares were issued pursuant to the Credit Agreement, as further described in Item 3.) | |||||
5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ | |||||
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH | 7 | SOLE VOTING POWER
0 | ||||
8 | SHARED VOTING POWER
350,539* | |||||
9 | SOLE DISPOSITIVE POWER
0 | |||||
10 | SHARED DISPOSITIVE POWER
350,539* |
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
350,539* | |||||
12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ | |||||
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.4%** | |||||
14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
OO |
* | See prior note above. |
** | See prior note above. |
CUSIP No. 30283R402 | 13D | Page 4 of 12 Pages |
1 | NAME OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Lateral U.S. Credit Opportunities Fund, L.P. | |||||
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) ☐ (b) ☒
| |||||
3 | SEC USE ONLY
| |||||
4 | SOURCE OF FUNDS (SEE INSTRUCTIONS)
OO (Shares were issued pursuant to the Credit Agreement, as further described in Item 3.) | |||||
5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ | |||||
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH | 7 | SOLE VOTING POWER
0 | ||||
8 | SHARED VOTING POWER
3,908,440* | |||||
9 | SOLE DISPOSITIVE POWER
0 | |||||
10 | SHARED DISPOSITIVE POWER
3,908,440* |
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,908,440* | |||||
12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ | |||||
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
16.0%** | |||||
14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
PN |
* | See prior note above. |
** | See prior note above. |
CUSIP No. 30283R402 | 13D | Page 5 of 12 Pages |
1 | NAME OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Niagara Nominee, LP | |||||
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) ☐ (b) ☒
| |||||
3 | SEC USE ONLY
| |||||
4 | SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC | |||||
5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ | |||||
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH | 7 | SOLE VOTING POWER
0 | ||||
8 | SHARED VOTING POWER
2,166,085* | |||||
9 | SOLE DISPOSITIVE POWER
0 | |||||
10 | SHARED DISPOSITIVE POWER
2,166,085* |
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,166,085* | |||||
12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ | |||||
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.9%* | |||||
14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
PN |
* | See prior note above. |
** | See prior note above. |
CUSIP No. 30283R402 | 13D | Page 6 of 12 Pages |
1 | NAME OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Lateral Credit Opportunities, LLC | |||||
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) ☐ (b) ☒
| |||||
3 | SEC USE ONLY
| |||||
4 | SOURCE OF FUNDS (SEE INSTRUCTIONS)
OO (Shares were issued pursuant to the Credit Agreement, as further described in Item 3.) | |||||
5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ | |||||
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH | 7 | SOLE VOTING POWER
0 | ||||
8 | SHARED VOTING POWER
3,908,440* | |||||
9 | SOLE DISPOSITIVE POWER
0 | |||||
10 | SHARED DISPOSITIVE POWER
3,908,440* |
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,908,440* | |||||
12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ | |||||
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
16.0%** | |||||
14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
OO |
* | See prior note above. |
** | See prior note above. |
CUSIP No. 30283R402 | 13D | Page 7 of 12 Pages |
1 | NAME OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Dhamitha Richard de Silva | |||||
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) ☐ (b) ☐
| |||||
3 | SEC USE ONLY
| |||||
4 | SOURCE OF FUNDS (SEE INSTRUCTIONS)
OO (Shares were issued pursuant to the Credit Agreement, as further described in Item 3.) | |||||
5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ | |||||
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
USA |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH | 7 | SOLE VOTING POWER
0 | ||||
8 | SHARED VOTING POWER
7,121,042* | |||||
9 | SOLE DISPOSITIVE POWER
0 | |||||
10 | SHARED DISPOSITIVE POWER
7,121,042* |
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,121,042* | |||||
12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ | |||||
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
29.2%** | |||||
14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN |
* | See prior note above. |
** | See prior note above. |
CUSIP No. 30283R402 | 13D | Page 8 of 12 Pages |
1 | NAME OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Patrick Feeney | |||||
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) ☐ (b) ☐
| |||||
3 | SEC USE ONLY
| |||||
4 | SOURCE OF FUNDS (SEE INSTRUCTIONS)
OO (Shares were issued pursuant to the Credit Agreement, as further described in Item 3.) | |||||
5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ | |||||
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
USA |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH | 7 | SOLE VOTING POWER
0 | ||||
8 | SHARED VOTING POWER
7,121,042* | |||||
9 | SOLE DISPOSITIVE POWER
0 | |||||
10 | SHARED DISPOSITIVE POWER
7,121,042* |
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,121,042* | |||||
12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ | |||||
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
29.2%** | |||||
14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN |
* | See prior note above. |
** | See prior note above. |
CUSIP No. 30283R402 | 13D | Page 9 of 12 Pages |
Introduction
This Amendment No. 5 (Amendment No. 5) amends and supplements the statement on Schedule 13D initially filed on May 15, 2017 (the Original 13D) as subsequently amended on November 14, 2017, December 12, 2017, December 18, 2018, and February 12, 2019. This Amendment No. 5 relates to shares of Common Stock, par value $0.001 per share (Common Stock), of FTE Networks, Inc., a Nevada corporation (the Issuer). Each Item below amends and supplements the information disclosed under the corresponding Item of the Original 13D. Except as specifically provided herein, this Amendment No. 5 does not modify any of the information previously reported in the Original 13D. Unless otherwise indicated herein, capitalized terms used but not defined in this Amendment No. 5 shall have the same meanings herein as are ascribed to such terms in the Original 13D.
Item 2. Identity and Background.
Item 2 is amended and restated in its entirety as follows:
This Schedule 13D is being filed by Lateral Investment Management, LLC, a Delaware limited liability company (LateralManagement), Lateral FTE Feeder LLC, a Delaware limited liability company (LateralFTE), Lateral U.S. Credit Opportunities Fund, L.P., a Delaware limited partnership (LateralFund), Niagara Nominee, LP, a Delaware limited partnership (Niagara), Lateral Credit Opportunities, LLC, a Delaware limited liability company (LateralGP), Dhamitha Richard de Silva, an individual (DeSilva), and Patrick Feeney, an individual (Feeney). Lateral Management, Lateral FTE, Lateral Fund, Niagara, Lateral GP, De Silva and Feeney are together referred to herein as ReportingPersons, and each of them are individually referred to herein as a ReportingPerson. Lateral Management is the sole manager of Lateral FTE and has a management agreement with Lateral Fund. Lateral GP is the sole general partner of Lateral Fund. De Silva and Feeney are the sole managers of Lateral Management and Lateral GP. Niagara and the other Reporting Persons have agreed to act in concert with respect to the Common Stock and agree to be treated as a group for Schedule 13D filing purposes.
Lateral FTE owns 350,539 shares of the Issuers Common Stock and does not own any shares of the Issuers Common Stock underlying warrants. Lateral Fund owns 3,146,690 shares of the Issuers Common Stock and an additional 2,470,220 shares of the Issuers Common Stock underlying warrants with an exercise price of $3.00 per share (subject to adjustment as described below), and an additional 761,750 shares of the Issuers Common Stock underlying warrants which are out of the money; Niagara owns 2,166,085 shares of the Issuers Common Stock and does not own any shares of the Issuers Common Stock underlying warrants. Other funds managed by Lateral Management own 695,978 shares of the Issuers common stock and an additional 703,510 shares of the Issuers Common Stock underlying warrants with an exercise price of $3.00 per share (subject to adjustment as described below).
Due to its relationship with Lateral FTE and Lateral Fund, Lateral Management may be deemed to have shared voting and investment power with respect to the shares owned by Lateral FTE and Lateral Fund. Lateral Management, however, disclaims beneficial ownership of such shares.
Due to its relationship with Lateral Fund, Lateral GP may be deemed to have shared voting and investment power with respect to the shares owned by Lateral Fund. Lateral GP, however, disclaims beneficial ownership of such shares.
Due to their relationships with Lateral Management and Lateral GP, De Silva and Feeney may be deemed to have shared voting and investment power with respect to the shares owned by Lateral Fund and Lateral FTE. De Silva and Feeney, however, disclaim beneficial ownership of such shares.
Due to the group status agreed to between the parties, Lateral Management, Lateral FTE, Lateral Fund, Lateral GP, De Silva and Feeney may be deemed to have beneficial ownership of the shares owned by Niagara, however each party disclaims beneficial ownership of such shares.
The percentages used herein are based on an aggregate total of 24,390,743 shares of Common Stock outstanding, comprised of 20,455,262 shares of Common Stock issued and outstanding as of July 2, 2019, as confirmed by the Issuer on July 9, 2019, plus 3,935,481 shares of Common Stock underlying warrants held by the Reporting Persons (all on a post-Reverse Stock Split basis).
Each Reporting Person that is an entity is organized under the state of Delaware. Each Reporting Person that is an individual is a U.S. citizen. The principal business of each Reporting Person is to engage in the business of investing in securities and other investment opportunities. The principal business address of each Reporting Person is 400 South El Camino Real, Suite 1100, San Mateo, CA 94402.
During the period beginning five years prior to the Event Date, none of the Reporting Persons or any of the natural persons described in this Item 2 has been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and, as a result of such proceeding, is or was subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
CUSIP No. 30283R402 | 13D | Page 10 of 12 Pages |
Item 3. Source and Amount of Funds or Other Consideration.
Item 3 is amended by adding the following at the end thereof:
On July 2, 2019, Lateral Fund received 1,049,285 shares of Common Stock from the Issuer and an additional 2,470,220 shares of the Issuers Common Stock underlying warrants with an exercise price of $3.00 per share (subject to adjustment as described below); other funds managed by Lateral Management received 450,715 shares of Common Stock from the Issuer and an additional 703,510 shares of the Issuers Common Stock underlying warrants with an exercise price of $3.00 per share (subject to adjustment as described below); and Niagara received 505,724 shares of Common Stock from the Issuer; in each case, in connection with the extension of additional credit under the Credit Agreement, as described below.
Item 5. Interest in Securities of the Issuer.
Item 5 is amended and restated in its entirety as follows:
(a)
As of July 2, 2019, the Reporting Persons beneficially own in the aggregate 7,121,042 shares of Common Stock, representing approximately 29.2% of the outstanding shares of Common Stock (based on an aggregate total of 24,390,743 shares of Common Stock outstanding, comprised of 20,455,262 shares of Common Stock issued and outstanding as of July 2, 2019, as confirmed by the Issuer on July 9, 2019, plus 3,935,481 shares of Common Stock underlying warrants held by the Reporting Persons (all on a post-Reverse Stock Split basis).
Lateral Fund is the record owner of a portion of the shares of Common Stock referred to above. Lateral GP is the sole general partner of Lateral Fund. Due to its relationship with Lateral Fund, Lateral GP may be deemed to have shared voting and investment power with respect to the Common Stock owned by Lateral Fund. Lateral GP, however, disclaims beneficial ownership of such shares. Lateral Management has a management agreement with Lateral Fund. Due to its relationship with Lateral Fund, Lateral Management may be deemed to have shared voting and investment power with respect to the Common Stock owned by Lateral Fund. Lateral Management, however, disclaims beneficial ownership of such shares. De Silva and Feeney are the sole managers of Lateral Management and Lateral GP. Due to their relationships with Lateral Management and Lateral GP, De Silva and Feeney may be deemed to have shared voting and investment power with respect to the Common Stock owned by Lateral Fund. De Silva and Feeney, however, disclaim beneficial ownership of such shares.
Niagara and the other Reporting Persons have agreed to act in concert with respect to the Common Stock and agree to be treated as a group for Schedule 13D filing purposes. Due to the group status agreed to between the parties, Lateral Management, Lateral FTE, Lateral Fund, Lateral GP, De Silva and Feeney may be deemed to have beneficial ownership of the shares owned by Niagara, however each party disclaims beneficial ownership of such shares.
Lateral FTE is the record owner of a portion of shares of the Common Stock referred to above. Lateral Management is the sole manager of Lateral FTE. Due to its relationship with Lateral FTE, Lateral Management may be deemed to have shared voting and investment power with respect to the Common Stock owned by Lateral FTE. Lateral Management, however, disclaims beneficial ownership of such shares. De Silva and Feeney are the sole managers of Lateral Management. Due to their relationships with Lateral Management, De Silva and Feeney may be deemed to have shared voting and investment power with respect to the Common Stock owned by Lateral FTE. De Silva and Feeney, however, disclaim beneficial ownership of such shares.
(b)
Reporting Persons | Number of Shares with Shared Dispositive Power | Number of Shares with Shared Voting Power | Aggregate Number of Shares Beneficially Owned | Percentage of Class Beneficially Owned* | ||||||||||||
Lateral Investment Management, LLC | 7,121,042 | 7,121,042 | 7,121,042 | 29.2 | % | |||||||||||
Lateral FTE Feeder, LLC | 350,539 | 350,539 | 350,539 | 1.4 | % | |||||||||||
Lateral U.S. Credit Opportunities Fund, L.P. | 3,908,440 | 3,908,440 | 3,908,440 | 16.0 | % | |||||||||||
Niagara Nominee, LP | 2,166,085 | 2,166,085 | 2,166,085 | 8.9 | % | |||||||||||
Lateral Credit Opportunities, LLC | 3,908,440 | 3,908,440 | 3,908,440 | 16.0 | % | |||||||||||
Dhamitha Richard de Silva | 7,121,042 | 7,121,042 | 7,121,042 | 29.2 | % | |||||||||||
Patrick Feeney | 7,121,042 | 7,121,042 | 7,121,042 | 29.2 | % |
* | Based on an aggregate total of 24,390,743 shares of Common Stock outstanding, comprised of 20,455,262 shares of Common Stock issued and outstanding as of July 2, 2019, as confirmed by the Issuer on July 9, 2019, plus 3,935,481 shares of Common Stock underlying warrants held by the Reporting Persons (all on a post-Reverse Stock Split basis). |
Except as described in Item 3, no transactions in shares of Common Stock or preferred shares convertible into shares of Common Stock have been effected during the past 60 days by the Reporting Persons.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Undertakings or Relationships with Respect to Securities of the Issuer.
Item 6 is amended by adding the following at the end thereof:
On July 2, 2019, the Issuer completed its previously announced debt restructuring by entering into an amended and restated Credit Agreement (the Credit Agreement Amendment) by and among the Issuer and its subsidiaries, Lateral Juscom, and the Reporting Persons, and by amending and restating its Series A convertible notes (the Series A Notes) and Series B promissory notes (the Series B Notes) issued to Fred Sacramone and Brian McMahon (together, the Benchmark Sellers) and a super-senior bridge loan note (the Bridge Note, and together with the Series A Notes and the Series B Notes, the Notes) issued to Mr. Sacramone.
Credit Agreement Amendment Summary
Pursuant to the Credit Agreement Amendment, terms of the $12.9 million super-senior bridge loan (the Lateral Bridge Loan) were amended to extend the maturity to September 30, 2020, to amend the interest rate to 12% per annum payable in cash, to add a 4% extension fee to the principal amount (subject to reduction) and to provide for monthly amortization payments based on available cash flow. In addition, the terms of the $37.9 million senior debt were amended to extend the maturity to April 30, 2021, amend the interest rate to 12% per annum payable in cash, to add a 4% extension fee to the principal amount thereof (subject to reduction) and to include monthly amortization payments based on available cash flow.
As consideration for the Credit Agreement Amendment, the Reporting Entities received 1,500,000 shares of the Issuers Common Stock and warrants exercisable to purchase 3,173,731 shares of the Companys common stock (collectively, the Lender Securities) with an initial exercise price of $3.00 per share. Pursuant to the terms of the warrants, in the event the Lateral Bridge Loan has not been paid by the Issuer by October 31, 2019, the exercise per share of half of the warrants shall be automatically reset to $0.01 and in the event the Lateral Bridge Loan has not been paid by the Issuer by December 31, 2019, the exercise per share of the other half of the warrants shall be automatically reset to $0.01. The Issuer also agreed that on December 31, 2019, the aggregate number of shares of the Issuers common stock issuable upon exercise of the warrants will be automatically adjusted on December 31, 2019 such that that the Reporting Persons will beneficially own, in the aggregate, inclusive of all shares of common stock previously issued, 25% of the outstanding shares of the Issuers common stock on a fully-diluted basis, subject to certain exceptions.
Registration Rights Agreement
As additional consideration for the Credit Agreement Amendment, the Reporting Persons entered into a registration rights agreement with the Issuer (the Registration Rights Agreement) whereby the Issuer agreed to customary terms for the registration of the common stock issued to the Reporting Persons.
Investor Rights Agreement
The Reporting Persons and the Issuer also entered into an investor rights agreement (the Investor Rights Agreement) whereby the Issuer agreed that within sixty days of its execution, the Issuer shall set the number of directors on its Board of Directors at seven and the Reporting Persons shall be entitled to nominate one of such seven directors.
The foregoing descriptions of the Credit Agreement Amendment, form of Warrant, Registration Rights Agreement and Investor Rights Agreement does not purport to be complete and are qualified in its entirety by reference to the full text of the same, copies of which are filed herewith as Exhibits 99.1, 99.2, 99.3 and 99.4, respectively.
Exhibit | Description | |
99.1 | Form of Warrant (incorporated by reference to Exhibit 4.1 to the Issuers Form 8-K filed by the Issuer with the Securities and Exchange Commission on July 2, 2019) | |
99.2 | Credit Agreement Amendment (incorporated by reference to Exhibit 10.1 to the Issuers Form 8-K filed by the Issuer with the Securities and Exchange Commission on July 2, 2019) | |
99.3 | Registration Rights Agreement (incorporated by reference to Exhibit 10.2 to the Issuers Form 8-K filed by the Issuer with the Securities and Exchange Commission on July 2, 2019) | |
99.4 | Investor Rights Agreement(incorporated by reference to Exhibit 10.3 to the Issuers Form 8-K filed by the Issuer with the Securities and Exchange Commission on July 2, 2019) |
CUSIP No. 30283R402 | 13D | Page 11 of 12 Pages |
SIGNATURES
After reasonable inquiry and to the best of their knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.
Dated: July 11, 2019 | ||
Lateral Investment Management, LLC | ||
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager | |
Lateral FTE Feeder, LLC | ||
By: | Lateral Investment Management, LLC | |
Its: | Manager | |
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager | |
Lateral U.S. Credit Opportunities Fund, L.P. | ||
By: | Lateral Credit Opportunities, LLC | |
Its: | General Partner | |
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager | |
Lateral Credit Opportunities, LLC | ||
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager | |
Niagara Nominee, LP | ||
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager |
Dhamitha Richard de Silva |
/s/ Dhamitha Richard de Silva |
Dhamitha Richard de Silva |
Patrick Feeney |
/s/ Patrick Feeney |
Patrick Feeney |
JOINT ACQUISITION STATEMENT
PURSUANT TO RULE 13D-1(k)(1)
The undersigned acknowledge and agree that the foregoing statement on Schedule 13D is filed on behalf of each of the undersigned and that all subsequent amendments to this statement on Schedule 13D shall be filed on behalf of each of the undersigned without the necessity of filing additional joint acquisition statements. The undersigned acknowledge that each shall be responsible for the timely filing of such amendments, and for the completeness and accuracy of the information concerning him, her or it contained herein, but shall not be responsible for the completeness and accuracy of the information concerning the other entities or persons, except to the extent that he, she or it knows or has reason to believe that such information is accurate.
Dated: July 11, 2019 | ||
Lateral Investment Management, LLC | ||
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager | |
Lateral FTE Feeder, LLC | ||
By: | Lateral Investment Management, LLC | |
Its: | Manager | |
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager | |
Lateral U.S. Credit Opportunities Fund, L.P. | ||
By: | Lateral Credit Opportunities, LLC | |
Its: | General Partner | |
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager | |
Lateral Credit Opportunities, LLC | ||
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager | |
Niagara Nominee, LP | ||
By: | /s/ Dhamitha Richard de Silva | |
Name: | Dhamitha Richard de Silva | |
Title: | Manager |
Dhamitha Richard de Silva |
/s/ Dhamitha Richard de Silva |
Dhamitha Richard de Silva |
Patrick Feeney |
/s/ Patrick Feeney |
Patrick Feeney |