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 3,
2009
MRU
Holdings, Inc.
(Exact
Name of Registrant as Specified in its Charter)
Delaware
(State
or Other Jurisdiction of Incorporation)
|
001-33073
|
33-0954381
|
|
(Commission
File Number)
|
(I.R.S.
Employer Identification No.)
|
|
|
|
|
590
Madison Avenue, 13
th
Floor
New
York, New York
|
10022
|
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
(212)
398-1780
(Registrant’s
Telephone Number, Including Area Code)
Not
Applicable
(Former
Name or Former Address, if Changed Since Last Report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (
see
General Instruction A.2.):
o
Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
Item
1.02
|
Termination
of a Material Definitive Agreement
|
The information set forth below under
Item 5.02 of this Current Report on Form 8-K is incorporated herein by
reference.
|
Item
1.03
|
Bankruptcy
or Receivership
|
On February 6, 2009, MRU Holdings, Inc.
(the “Company”) filed a voluntary petition in the United States Bankruptcy Court
for the Southern District of New York (the “Court”) (Case Number 09-10530),
seeking relief under Chapter 7 of Title 11 of the United States
Code. As a result of this bankruptcy filing, the Company has
suspended business operations. The Company expects that the Court
will promptly appoint a bankruptcy trustee.
In accordance with no-action letters
issued by the Securities and Exchange Commission (see,
Paiute Oil and Mining Corp
.,
Securities and Exchange Commission No-Action Letter, January 22, 1987), the
Company expects that it will cease to file reports under the Securities Exchange
Act of 1934, as amended.
|
Item
2.04
|
Triggering
Events That Accelerate or Increase a Direct Financial Obligation or
anObligation under and Off-Balance Sheet
Arrangement
|
On February 3, 2009, the Company, and
each of the following subsidiaries of the Company: Goto College Holdings Inc.,
Embark Corp., Embark Online, Inc., iempower, Inc., MRU Originations, Inc., MRU
Universal Guaranty Agency, Inc. (collectively, the “Subsidiaries”), received a
written acceleration notice (the “Notice”) from Longview Marquis Master Fund,
L.P. with respect to all amounts payable, to be due and payable immediately
under the 12% senior secured notes issued by the Company on October 19, 2007 in
a private placement transaction, in an aggregate original principal amount of
$11,200,000 (the “Senior Secured Notes”). The Senior Secured Notes
were sold to Longview Marquis (including as successor to The Longview Fund,
L.P., under the Purchase Agreement (as defined below), “Buyer”) pursuant to the
terms of a securities purchase agreement, dated as of October 19, 2007, by and
among the Company and the Buyer (the “Purchase Agreement”).
As previously disclosed, on January 9,
2009,
the
Company
entered into a
Fourth Amendment agreement (the “Fourth Amendment”) with respect to
its
Senior
Secured
Notes.
The Fourth Amendment was
made by and among the Company, the
Subsidiaries, the Buyer
and
Viking Asset Management, LLC (“Viking”), a California limited liability company,
in its capacity as collateral agent for the benefit of Buyer (in such capacity,
the “Collateral Agent”).
Among other things, the
Fourth Amendment amended certain provisions of the Purchase Agreement
including the covenant with respect to the amount of the Company’s indebtedness
as it relates to payables. The covenant was amended to extend the
date by wh
ich the Company’s
receivables were required to
decrease to $5,000,000 until January
21, 2009 (“Accounts Payable Decrease Date”
).
On January 21, 2009, the parties agreed
to extend the Accounts Payable Decrease Date until January 22, 2009 and, on
January 23, 2008 the parties further agreed to extend the Accounts Payable
Decrease Date until January 28, 2009, in each case subject to all the other same
terms and conditions as set forth in the Fourth Amendment.
The Company did not decrease its
receivables to $5,000,000 by January 28, 2009. The Notice stated that
this failure to decrease the payables had resulted in both a breach of Section
5(g) of the Purchase Agreement and an event of default under Section 8(a)(ix) of
each Senior Secured Note. Pursuant to Section 8(b) of each Senior
Secured Note, all unpaid amounts (an aggregate of $11,317,830.14 as of February
6, 2009) will bear interest at 17% per annum. The interest that is
due for each day such amounts remain unpaid is $5,271.32.
The Subsidiaries also received written
notice from the Buyer of its current intention to not exercise any of its
respective rights, powers and remedies against the Subsidiaries under the
guaranty given to Viking, as collateral agent for the benefit of the Buyer, in
connection with the Purchase Agreement by each of the
Subsidiaries. However, the Notice states that the Buyer reserves its
rights, powers and remedies with respect to future actions.
Under
each of the eleven (11) subordinated promissory notes issued by the Company in
July 2008 to eleven non-affiliated investors (collectively, the “Subordinated
Debt”), the non-payment of the principal of the Senior Secured Notes due to the
acceleration on February 3, 2009 described above constitutes an event of default
under Section 5(a) of each of the subordinated promissory notes that constitute
the Subordinated Debt. As a result of the events of default under the
Subordinated Debt, the entire outstanding principal amounts and all accrued
unpaid interest on the Subordinated Debt accelerate automatically, becoming due
and payable immediately, and each holder to the Subordinated Debt may take any
action available to it at law or in equity to collect and otherwise enforce such
rights. The aggregate amount due (as of February 6, 2009) as a result
of the acceleration of the Subordinated Debt (including for each subordinated
promissory note both outstanding principal and accrued interest payable) is
$22,475,939.46.
The bankruptcy petition filed by the
Company resulted in an event of default under Section 7.01(g) of the Amended and
Restated Master Loan Agreement, dated as of February 1, 2007, as amended (the
“Loan Agreement”), by and between MRU Funding SPV Inc. (“MRUF”), a subsidiary of
the Company, and Merrill Lynch Bank USA (“MLBU”). Pursuant to Section
8(a) of the Loan Agreement, the principal amount of the loans outstanding under
the related note become immediately due and payable along with all interest,
fees and expenses which have accrued under the Loan Agreement. As of
February 6, 2009, the aggregate amount outstanding is $
34,170,636.82,
plus accrued interest thereon
. In addition, as a result of the
event of default under the Loan Agreement, MLBU may exercise certain additional
rights, including amongst others, the right of MLBU to obtain
physical possession of all files of MRUF relating to the collateral, the right
to payment of all reasonable legal or other expenses, damages or any other
losses resulting from the event of default and the exercise of all rights
available to MLBU under any other agreement or applicable law.
|
Item
5.02
|
Departure
of Directors or Certain Officers; Election of Directors; Appointment
ofCertain Officers; Compensatory Arrangements of Certain
Officers
|
(b) Effective February 6, 2009, Edwin
J. McGuinn, Michael M. Brown, Andrew Mathieson, Raza Khan and Vishal Garg
resigned from their respective positions as members of the Board of Directors of
MRU Holdings, Inc. In addition, effective February 6, 2009, Edwin J.
McGuinn, Chairman and Chief Executive Officer, Raza Khan, Co-President, Vishal
Garg, Co-President, John P. Derham, its Chief Marketing Officer, and Jonathan
Coblentz, its Chief Financial Officer and Treasurer, resigned from their
respective positions as officers of the Company.
(e) As a result of the voluntary
bankruptcy petition under Chapter 7 of Title 11 of the United States Code filed
by the Company on February 6, 2009, the Company terminated the employment of all
of its employees, including Edwin J. McGuinn, Raza Khan, and Vishal
Garg. Such termination were without “cause” as defined in the
employment agreement of each of Messrs. McGuinn, Khan and
Garg. Pursuant to Mr. McGuinn’s employment agreement with the
Company, dated September 27, 2007, as amended, if Mr. McGuinn’s employment is
terminated without cause he becomes entitled to his base salary (including
guaranteed annual ten percent increases), guaranteed annual bonus, continued
health and benefits coverage and the value of unused vacation days accrued from
January 1, 2009 until the expiration date of his employment agreement, plus one
year of severance pay, in addition to any earned but unpaid base salary, unpaid
pro rata annual bonus. The aggregate amount Mr. McGuinn is entitled
to based on the termination of his employment without cause is
$545,383.70. Pursuant to each of Mr. Khan’s and Mr. Garg’s employment
agreements with the Company, dated April 1, 2004, as amended, if Mr. Khan’s or
Mr. Garg’s employment are terminated without cause each will be entitled to any
earned but unpaid base salary, unpaid pro rata annual bonus and the value of
unused vacation days accrued from December 11, 2008 through their last day of
employment with the Company, their base salary (including guaranteed annual ten
percent increases), guaranteed annual bonus, continued health and benefits
coverage, plus one year of severance pay.
Mr. Khan and Mr. Garg are
each entitled to an aggregate amount of $319,965.14 based on the termination of
their employment without cause.
|
Item
9.01
|
Financial
Statements and Exhibits
|
|
|
99.1
|
Press release dated February 6,
2009
|
SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, as amended, the Registrant has duly caused this
report to be signed on its behalf by the undersigned hereunto duly
authorized.
|
|
MRU
HOLDINGS, INC.
|
|
|
|
|
|
|
|
|
By:
|
/s/ Jonathan
Coblentz
|
|
|
|
|
Name:
Jonathan Coblentz
|
|
|
|
|
Title:
Chief Financial Officer and Treasurer
|
|
|
|
|
|
|
Mru Holdings (MM) (NASDAQ:UNCL)
Historical Stock Chart
From Jan 2025 to Feb 2025
Mru Holdings (MM) (NASDAQ:UNCL)
Historical Stock Chart
From Feb 2024 to Feb 2025
