Unassociated Document
UNITED
STATES
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) January
23, 2008
Interpharm
Holdings, Inc.
(Exact
name of Registrant as specified in charter)
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Delaware
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0-22710
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13-3673965
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(State
or other jurisdic-
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(Commission
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(IRS
Employer
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tion
of incorporation)
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File
Number)
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Identification
No.)
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75
Adams Avenue, Hauppauge, New York
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11788
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant's
telephone number, including area code: (631)
952 0214
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:
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 CFR240.14d-2(b))
o
Pre-commencement communications pursuant to Rule
13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item
2.04
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Triggering
Events that Accelerate or Increase a Direct Financial Obligation
or an
Obligation under an Off-Balance Sheet Arrangement
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As
disclosed in Interpharm Holdings, Inc.’s (“Holdings”) Current Report on Form 8-K
filed with the SEC on February 15, 2006 (the “February 8-K”), Interpharm, Inc.
(the "Company"), a wholly owned subsidiary of Holdings entered into a credit
agreement (the "Wells Fargo Credit Agreement") with Wells Fargo Bank, National
Association, acting through its Wells Fargo Business Credit operating division
("Wells Fargo"). Under the Wells Fargo Credit Agreement, the Company obtained
a
$41,500,000 credit facility from Wells Fargo. Copies of the Wells Fargo Credit
Agreement and related documents are annexed to the February 8-K.
On
October 26, 2007, the Company, Holdings and Wells Fargo Business Credit entered
into a Forbearance Agreement, which was subsequently amended on November 12,
2007. As of June 30, 2007, the Company had defaulted under the Senior Credit
Agreement with respect to (i) financial reporting obligations, including the
submission of its annual audited financial statements for the fiscal year ending
June 30, 2007, and (ii) financial covenants related to minimum net cash flow,
maximum allowable leverage ratio, maximum allowable total capital expenditures
and unfinanced capital expenditures for the fiscal year ended June 30, 2007
(collectively, the “Existing Defaults”). Pursuant to the Forbearance Agreement,
WFBC agreed to waive the Existing Defaults based upon the Borrower’s
consummation and receipt of $8,000,000. On November 7 and 14, 2007, Holdings
and
the Company received a total of $8,000,000 in gross proceeds from the issuance
and sale of subordinated debt. In addition, the Forbearance Agreement served
as
an amendment to the Wells Fargo Credit Agreement with respect to certain
financial covenants, including, but not limited to, the Company’s required Net
Income Before Tax and Net Cash Flow.
As
reported in Holdings Current Report on Form 8-K filed with the SEC on January
11, 2008, on January 10, 2007, Holdings and the Company received notice (the
“Notice”) from Wells Fargo that they had defaulted under the Forbearance
Agreement with respect to: (i) financial covenants relating to Required Income
Before Tax for the months ending October 31, 2007 and November 30, 2007, (ii)
financial covenants relating to required Net Cash Flow for the months ending
October 31, 2007 and November 30, 2007 and (iii) an obligation to have a
designated financial advisor provide an opinion as to Holdings and the Company’s
ability to meeting their fiscal year 2008 projections.
As
of the
date of this Current Report, Wells Fargo is in the process of assessing the
Company’s eligible collateral under the Wells Fargo Credit Agreement and is
providing limited credit availability for ongoing operations pending the outcome
of that review. The Company and Holdings are currently seeking other means
of
financing their business.
As
of the
date of this Current Report, Wells Fargo has not demanded repayment of the
outstanding amount under the Wells Fargo Credit Agreement, but has reserved
the
right to do so as set forth in the Notice.
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.
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INTERPHARM
HOLDINGS, INC.
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January
23, 2008
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By:
/s/ Peter
Giallorenzo
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Peter Giallorenzo
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Chief Financial Officer and
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Chief Operating Officer
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