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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
Commission File No. 0-28223
Date of Report (Date of earliest event reported): June 16, 2000
MERIDIAN USA HOLDINGS, INC.
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Exact Name of Registrant as Specified in Its Charter)
Florida 65-0510294
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
3350 N.W. 2nd Avenue, Suite A28, Boca Raton, FL 33431
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(Address of Principal Executive Offices)
(561)-417-6800
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(Issuer's Telephone Number, Including Area Code)
NOT APPLICABLE
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(Former name or former address, if changed since last report)
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Item 5. Other Events
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On June 16, 2000, Meridian entered into a Securities Purchase
Agreement and related agreements with U.S. Bancorp Libra, a Division of U.S.
Bancorp Investments, Inc., pursuant to which U.S. Bancorp Libra purchased
Meridian's Series A Convertible 5% Note due 2010 ("Convertible Note") for $8
million.
The proceeds from the issuance of the Convertible Note will be used
by Meridian for marketing, product development, working capital and other
corporate uses. The bridge loan from U.S. Bancorp Libra dated May 11, 2000 in
the amount of $500,000 was repaid from the proceeds of the Convertible Note.
The Convertible Note, upon satisfaction of certain conditions, is
convertible into Series II Preferred Stock, which in turn is convertible into
shares of Common Stock at an exercise price of $1.70 per share. Assuming full
conversion of the Convertible Note on the date of issuance, U.S. Bancorp Libra
would receive approximately 4,700,000 shares of Meridian's Common Stock.
The Convertible Note is required to be converted to Series II
Preferred Stock upon the earlier of (i) one (1) year from the date of issuance,
or (ii) at the option of Meridian or the Noteholders, upon U.S. Bancorp Libra's
compliance with 1843(k)(H) of the Bank Holding Company Act of 1956, as amended.
Series II Preferred Stock is convertible into the number of shares of Common
Stock determined by dividing $8 million plus interest accrued at 5% compounded
quarterly, by a conversion price of $1.70 (subject to adjustment for
recapitalization, stock splits, stock dividends, etc.). The Series II Preferred
Stock also carries a mandatory redemption feature, which obligates Meridian to
redeem the Series II Preferred Stock ten (10) years after the date of issuance,
to the extent not previously converted into Common Shares, at principal plus
five (5%) percent interest compounded quarterly.
Pursuant to a Registration Rights Agreement, Meridian is required to
use its best efforts to complete, on or before December 31, 2000, a Shelf
Registration pursuant to Rule 415 under the Securities Act of 1933 with respect
to the shares of Common Stock underlying the Series II Preferred Stock.
Meridian is required to maintain the effectiveness of the Shelf Registration
until all shares of Common Stock underlying the Series II Preferred Stock have
been sold into the market.
Pursuant to the terms of the Convertible Note and the Series II
Preferred Stock, Meridian has agreed that certain corporate actions, including
mergers, acquisitions, sales of all or substantially all its assets, issuance of
debt or equity securities or transactions between Meridian and its affiliates,
will be subject to the approval of a majority of the Noteholders or Series II
Preferred Stockholders, as the case may be. The Noteholders and the Series II
Preferred Stockholders have the right to designate one nominee for election to
the Board of Meridian and Meridian's principal shareholders have agreed to vote
for such nominee. Series II Preferred Stockholders have the right to vote,
together with the Common Stockholders, on all matters coming before the
stockholders of Meridian on an "as converted" basis and have agreed to vote
their shares in favor of the nominees for director proposed by Meridian through
and including Meridian's 2001 Annual Meeting of Shareholders.
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In consideration for financial advisory services provided by U.S.
Bancorp Libra related to this transaction, Meridian has paid U.S. Bancorp Libra
an investment advisory fee of 7% of the principal amount of the Convertible Note
and issued warrants to U.S. Bancorp Libra and its designees to purchase an
aggregate of 5% of the fully diluted equity of Meridian at an exercise price of
$1.75 per share. The warrant has a seven (7) year term and contains certain
anti-dilution and registration rights.
Item 7. Financial Statements and Exhibits
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(C) EXHIBITS
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3.1 Articles of Amendment to Articles of Incorporation Designating
the Series II Convertible Preferred Stock.
4.1 Series A Convertible 5% Note due 2010 of Meridian USA Holdings,
Inc.
4.2 Form of Common Stock Purchase Warrant expiring June 16, 2007,
issued to U.S. Bancorp Libra and its designees, aggregating 698,948 Warrants.
10.1 Securities Purchase Agreement dated June 16, 2000 between
Meridian USA Holdings, Inc. and U.S. Bancorp Investments, Inc.
10.2 Registration Rights Agreement dated June 16, 2000 between
Meridian USA Holdings, Inc. and U.S. Bancorp Investments, Inc.
10.3 Investor Rights Agreement dated June 16, 2000 between Meridian
USA Holdings, Inc. and U.S. Bancorp Investments, Inc.
10.4 Securityholders Agreement dated June 16, 2000 among Meridian USA
Holdings, Inc., Alan Posner, Mark Streisfeld, Paul Galant, Joel Flig, Ronald
Shapss and U.S. Bancorp Investments, Inc.
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SIGNATURES
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 thereunto duly authorized.
Meridian USA Holdings, Inc.
By: /s/ Mark Streisfeld
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Name: Mark Streisfeld
Title: President
Date: June 20, 2000
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