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| Inside look DesignLine USA troubles: lawsuits, stock market, borrow $, debt, etc... (197917) | |||
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Inside look DesignLine USA troubles: lawsuits, stock market, borrow $, debt, etc... |
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Posted by Gold_12th on Thu Jun 10 04:03:40 2010 I been researching a lot from the local news in DesignLine plant in NC. So heres some thing to share.....Board of directors: DesignLine International Corp.’s board of directors includes several big names, both local and national. Among them: •Former N.C. Gov. James Martin. •Business consultant Linda Combs, a five-time presidential appointee under Ronald Reagan, George H.W. Bush and George W. Bush. •Joseph Cox, an attorney with Dallas-based law firm Patton Boggs and a former Texas district judge. •Retired U.S. Air Force Lt. Gen. Buster Glosson, chief executive and chairman of private-investment company Eagle Ltd., and father of DesignLine CEO Brad Glosson. •Edward Weisiger, chairman of Charlotte-based Carolina Tractor and Equipment Co. The company also made headlines just before Christmas, when it hired Charlotte Mayor Anthony Foxx. He previously was an attorney with the local office of law firm Hunton & Williams but has joined DesignLine’s corporate legal department. And DesignLine’s board members in Charlotte previously included Hugh McColl III and the late Skipper Beck, a longtime auto dealer here. Correction: An earlier version of this story incorrectly stated that banker Hugh McColl Jr. was previously a member of DesignLine International Corp.'s board. Source: http://www.bizjournals.com/charlotte/stories/2010/01/18/story9.html ======================================================= Past 6 months of headlines in their corporations: #1. Friday, January 15, 2010 DesignLine goes public, faces deadline on debt Hybrid bus producer’s loans with Wachovia due today, filings show Charlotte-based DesignLine International Corp. has become a public company through a reverse merger with a Nevada company. The hybrid electric bus maker’s shares are now listed with the Securities and Exchange Commission, trading over the counter with the ticker symbol DSLI. But just weeks after going public, DesignLine is facing a major financial hurdle: Today is the maturity date for two big loans. DesignLine Chief Executive Brad Glosson couldn’t be reached for comment this week. But company filings with the SEC and a recent lawsuit against the bus maker provide details on the debt. The company has a $7 million revolving credit facility and an $800,000 term loan with Wachovia Bank, now owned by Wells Fargo & Co. On Oct. 16, Wachovia filed suit against DesignLine in Mecklenburg Superior Court alleging the company had defaulted on both. DesignLine owed the bank more than $6.5 million, plus interest, on the credit line and more than $827,200 on an interest-free loan that came due in May. Wachovia gave the company an interest break on the term loan because DesignLine funded construction of a pair of hybrid buses the bank used for promotional purposes, filings state. In its suit, Wachovia also sought to seize personal property from DesignLine to cover the debt. But less than two weeks after filing the suit, Wachovia dropped its claim and dismissed the complaint without prejudice, meaning the bank can refile the case if it decides to pursue the default. DesignLine had negotiated an extension of the loan agreements, first to Dec. 1, then to today. What happens regarding the loans after today isn’t clear. DesignLine could negotiate another extension or pay off the debt. In a Dec. 19 filing with the SEC, Glosson stated: “We intend to repay the facilities in full by means of a replacement facility and/or with additional capital we raise in the future, although we can offer no assurances in that regard.” The bank and its legal representatives didn’t respond to requests for comment. In its SEC filings, DesignLine says the revolving credit line at Wachovia is “secured by substantially all of our U.S. assets.” The $800,000 loan is secured by the two hybrid transit vehicles. The company also has three letters of credit issued for $4.2 million, $500,000 and $448,000 that are secured by $4.2 million in cash on deposit with the bank. Last month, DesignLine raised $2 million from its investors and used half that money to pay part of the balance on the revolving credit facility. A Dec. 17 regulatory filing states that Glosson and another director paid Wachovia a combined $1.65 million to satisfy the terms of their guarantees. While the other director is not named, Wachovia’s lawsuit lists Glosson as well as his father, retired U.S. Air Force Lt. Gen. Buster Glosson, and Wesley Jones Sr. as the guarantors. Those payments reduced the outstanding balance on the credit facility to about $4.7 million as of Dec. 16, a company filing states. The three guarantors are members of a group of investors who bought the company in 2006 and moved its headquarters here from New Zealand. The investment group’s intent was to expand DesignLine’s business globally. DesignLine became a public company through a “reverse triangular merger” with Nevada-based Jasper Ventures. The deal began in early October and was completed Nov. 9. According to regulatory filings, DesignLine’s assets totaled $50.36 million as of Oct. 3, with its property, plant and equipment valued at $5.8 million. Its two main contracts for selling hybrid buses are a $50.38 million deal with New York City Transit Authority and a $12.2 million agreement with the city of Baltimore. DesignLine also has a contract with Modern Arabian Business Co., which acquired the rights to sell the bus maker’s technology and designs in the Middle East and North Africa. Source: http://charlotte.bizjournals.com/charlotte/stories/2010/01/18/story8.html ____________________________________________________________________________________________________ #2. Thursday, January 28, 2010, 12:16pm EST | Modified: Thursday, January 28, 2010, 1:34pm DesignLine files to delist Charlotte-based DesignLine International Corp. has decided it doesn’t want to be a public company after all. The hybrid electric bus maker announced today that it has filed to deregister its common stock with the Securities and Exchange Commission. It’s been less than three months since DesignLine completed a complicated “reverse triangular merger” with Nevada-based Jasper Ventures to go public. The company, which had briefly traded over the counter under the ticker symbol DSLI, says it also filed to immediately suspend its reporting obligations. The board made the decision to deregister “after careful consideration of the advantages and disadvantages of being a public company,” the filing states. The reasons included the cost of remaining public, the size of the company's shareholder base, its trading history, access to subordinated debt financing, and demands on management's time to comply with SEC rules and requirements under the Sarbanes-Oxley Act. DesignLine recently obtained an extension on two outstanding debts. Source: http://www.bizjournals.com/charlotte/blog/going_green/2010/01/designline_files_to_delist.html ____________________________________________________________________________________________________ #3. Friday, February 19, 2010 | Modified: Wednesday, February 24, 2010 DesignLine battle with a supplier headed to court Charlotte-based hybrid busmaker DesignLine International and its former supplier of batteries are set to battle it out in a trial set for this summer. Last year, Reno, Nev.-based Altairnano sued DesignLine, alleging it was owed $353,538 for a battery order. The company also is asking for 18% interest on the unpaid balance (claimed due since Jan. 22, 2009) plus $88,384 for legal fees. DesignLine filed a counterclaim last month. The companies had negotiated a contract for battery components in early 2008, according to court filings. DesignLine prepaid $40,000 to Altairnano, which then sent a shipment of battery components in October 2008. According to DesignLine, that’s when things went wrong. The company’s Jan. 15 court filing says the batteries it received suffered from “thermal leakage, water leakage, internal short circuits, and leakage of electrical current into the frame of the bus.” The parts were “unusable due to the potential safety hazards, potential human harm, and the likelihood of overall battery failure.” DesignLine says it incurred extensive costs to redesign the battery packs. And it contends Altairnano caused the busmaker to lose sales because of the problems. DesignLine is asking for damages in excess of $10,000. Attorneys Michael Adams and Todd Sprinkle of Parker Poe in Charlotte represent DesignLine in the dispute. Altairnano will be represented by attorneys Robert Marcus, Jonathan Heyl and Evan Sauda of Charlotte law firm Smith Moore Leatherwood. Altairnano Inc. vs. Designline International Holdings LLC goes before a Mecklenburg Superior Court judge on Aug. 23. A group of investors bought DesignLine in 2006 and moved its headquarters here from New Zealand. The investment group’s intent is to expand DesignLine’s business globally. Its two main contracts for selling hybrid buses are a $50.38 million deal with the New York City Transit Authority and a $12.2 million agreement with the city of Baltimore. DesignLine also has a contract with Modern Arabian Business Co., which acquired the rights to sell the company’s technology and designs in the Middle East and North Africa. Darren Jamison — chief executive of DesignLine supplier Capstone Turbine Corp. of California — noted in an earnings call on Feb. 9: “We are amazed by the opportunities for our U.S. hybrid transit bus customer DesignLine, who has over 500 buses in backlog from New York, Baltimore, Charlotte and several California transit properties.” Last month, DesignLine reversed its decision to become a public company. The company, which briefly traded over the counter under the ticker symbol DSLI, told the Securities and Exchange Commission on Jan. 28 that it was immediately suspending its reporting obligations. Source: http://baltimore.bizjournals.com/charlotte/stories/2010/02/22/story15.html?q=DesignLine ___________________________________________________________________________________________________ #4. Friday, May 14, 2010 DesignLine faces another suit from former vendor A Texas company is suing Charlotte hybrid electric busmaker DesignLine International for failing to pay for parts that sat in a warehouse for 11 months. Fort Worth-based Allied Electronics Inc. claims DesignLine owes $44,929.06 for parts and equipment, according to a suit filed last month in Mecklenburg Superior Court. The complaint says DesignLine had sent orders since February 2009 for the custom products. The total bill was $60,017.58. Court documents note DesignLine sent payment of $15,088.52 in March. The amount owed on goods that were shipped to Charlotte totaled $29,395.20. Allied says it was holding specially manufactured goods in stock for DesignLine that are valued at $30,622.38, according to court documents. DesignLine counters that it reached an agreement with its former supplier months ago. “Allied apparently pre-ordered a large number of parts ostensibly based on a misunderstanding between our companies. These parts are still used on our vehicles, albeit now supplied by another vendor,” says Jennifer Matthews, DesignLine spokeswoman. Attorney Court Young of Poyner Spruill in Charlotte is representing Allied. Allied isn’t the only vendor embroiled in a legal dispute with DesignLine. In April, the court assigned Wayne Huckel of Charlotte to mediate a case between the busmaker and its former battery supplier. Last year, Reno, Nev.-based Altairnano sued DesignLine claiming it was owed $353,538. The company also is asking for 18% interest on the unpaid balance, plus $88,384 for legal fees. DesignLine fired back with a counterclaim that the batteries it received suffered from “thermal leakage, water leakage, internal short circuits, and leakage of electrical current into the frame of the bus.” Matthews says Altairnano never provided a single battery that met DesignLine specifications. The batteries failed repeatedly and represented a safety hazard, she says. Attorneys Michael Adams and Todd Sprinkle of Parker Poe in Charlotte represent DesignLine in that case. Altairnano will be represented by attorneys Robert Marcus, Jonathan Heyl and Evan Sauda of Charlotte law firm Smith Moore Leatherwood. A trial has been scheduled for Oct. 4 in Mecklenburg Superior Court. Source: http://www.bizjournals.com/portland/othercities/charlotte/stories/2010/05/17/story12.html?b=1274068800^3351151&s=industry&i=manufacturing |
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