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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
Date of Report (Date of earliest event reported) February 25, 1998
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First Pacific Networks, Inc.
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(Exact name of registrant as specified in charter)
Delaware 0-20238 77-074188
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
871 Fox Lane, San Jose, California 95131
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (408) 943-7600
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(Former name or former address, if changed since last report)
1.
This Current Report, including exhibits, contains 4 pages.
The Exhibit Index is located on page 4.
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ITEM 5.
On February 10, 1997, the Company voluntarily filed for relief under
Chapter 11 of the United States Bankruptcy Code (the "Bankruptcy Code"). The
petition was filed in the United States Bankruptcy Court for the Northern
District of California - the San Jose Division (the "Court") and was
assigned case number 97-5-1077. The Company is operating as
debtor-in-possession under the Bankruptcy Code. The Company has limited
capital available for reorganization and is seeking a strategic relationship
or capital infusion for such purpose. Any trading of the Company's stock at
this time should be considered highly speculative.
On January 15, 1998, the Company entered into a Loan and Security
Agreement (the "Agreement") with Asset Recovery Group, LLC, a Colorado
limited liability company ("ARG") pursuant to which the Company may borrow
in increments up to $600,000. Amounts borrowed under the Agreement will bear
interest at a rate of 10% per annum and will have a super priority status and
will be secured by all of the assets of the Company once the Company has
borrowed the entire $600,000. The Court had previously approved the borrowing
of $158,000 of funds under the Agreement as an interim bridge loan and on
February 25, 1998 the Court signed an order granting final approval of the
entire $600,000 borrowing and related Agreement. Mr. Donald G. Marquart a
former co-founder, officer and director and current shareholder of the
Company is a co-manager of ARG and an investor in ARG. The funds will be
utilized to fund limited operations until a Plan of Reorganization jointly
developed with the lender can be prepared, funded and confirmed. There can
be no assurance that that adequate funding will be obtained from ARG to fund
the entire Agreement or to adequately fund a Plan of Reorganization. The
Company will pay a 10% finder's fee on the amounts borrowed under the
Agreement.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statement of Business Acquired.
Not Applicable.
(b) Pro Forma Financial Information.
Not Applicable.
(c) Exhibits
None.
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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 hereunto duly authorized.
FIRST PACIFIC NETWORKS, INC.
Date: March 12, 1998 By: /s/ Kenneth W. Schneider
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Kenneth W. Schneider
Chief Financial Officer
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EXHIBIT INDEX
Exhibit No. Description
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Not Applicable
