KRMN 8-K
Karman Holdings Inc. (KRMN)
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
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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:
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01 Entry into a Material Definitive Agreement.
On May 27, 2025, Karman Holdings Inc. (the “Company”) entered into that certain First Amendment to Credit Agreement (the “Credit Agreement Amendment”) which amends that certain Credit Agreement, dated as of April 1, 2025, (as amended by the Credit Agreement Amendment, the “Credit Agreement”) by and among the Company, Citibank, N.A. (“Citibank”), and the other parties thereto. The Credit Agreement Amendment provides for an incremental term loan in the aggregate original principal amount of $75,000,000 (the “Incremental Term Loan”). The Company anticipates using the proceeds of the Incremental Term Loan to repay outstanding revolving credit loans under the Credit Agreement, for working capital and other general corporate purposes (including, without limitation, investments) and for the payment of any fees, commissions and expenses associated therewith.
The foregoing description of the Credit Agreement Amendment does not purport to be complete and is subject to, and qualified in its entirety by, reference to the Credit Agreement Amendment, a copy of which is attached hereto and filed as Exhibit 10.1 and incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
Please see Item 1.01 above, which information is incorporated by reference into this Item 2.03.
Item 7.01 Regulation FD Disclosure.
On May 29, 2025, the Company issued a press release announcing its entry into the transaction described below in Item 8.01 of this Current Report on Form 8-K. A copy of the press release is furnished as Exhibit 99.1 hereto and is incorporated by reference herein. The information in this Item 7.01 and Exhibit 99.1 attached hereto shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise be subject to liability under that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as expressly set forth therein.
Item 8.01 Other Events.
On May 28, 2025, the Company announced that it had entered into a Securities Purchase Agreement (the “Agreement”) under which a wholly-owned subsidiary of the Company has agreed to purchase Industrial Solid Propulsion (“ISP”) and related real estate of ISP, for $50,000,000 in cash and 147,842 shares of common stock of the Company, subject to the satisfaction or waiver of certain customary closing adjustments. The Agreement contains customary representations, warranties and covenants of the parties.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit Number |
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Description |
10.1 |
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99.1 |
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104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL document). |
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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.
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Karman Holdings Inc. |
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Date: |
June 2, 2025 |
By: |
/s/Mike Willis |
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Name: Title: |
Mike Willis |
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Exhibit 10.1
FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is entered into as of May 27, 2025 by and among Karman Holding Inc., a Delaware corporation (“Borrower”), the other Loan Parties party hereto, the First Amendment Incremental Term Lenders (as defined below) and CITIBANK, N.A., as Administrative Agent and Collateral Agent (in such capacities, the “Administrative Agent”).
W I T N E S S E T H:
WHEREAS, Borrower, the existing Lenders party thereto prior to the effectiveness of this Amendment, and Administrative Agent are parties to that certain Credit Agreement, dated as of April 1, 2025 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time prior to the First Amendment Effective Date (as defined below), the “Credit Agreement”, and as amended by this Amendment, the “Amended Credit Agreement”);
WHEREAS, the Borrower has requested an Incremental Term Loan in an aggregate principal amount equal to $75,000,000 (the “First Amendment Incremental Term Loans”) in accordance with Section 2.14 of the Credit Agreement;
WHEREAS, subject to the terms and conditions set forth herein, the First Amendment Incremental Term Lenders (as defined below) have agreed on the terms and conditions set forth herein, to provide the First Amendment Incremental Term Loans to the Borrower;
NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained herein and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows:
“First Amendment Effective Date” has the meaning set forth in Section 3 of the First Amendment to Credit Agreement, dated as of May 27, 2025, by and among the Borrower, Lenders party thereto and the Administrative Agent, which date is May 27, 2025.
Date |
Amount |
The last Business Day of each fiscal quarter ending prior to the Maturity Date for the Initial Term Loans starting with the fiscal quarter ending on September 30, 2025 |
0.25% of the aggregate principal amount of the aggregate initial principal amount of the Initial Term Loans on the First Amendment Effective Date. |
Maturity Date for the Initial Term Loans |
All unpaid aggregate principal amounts of any outstanding Initial Term Loans |
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[Remainder of Page Left Intentionally Blank]
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IN WITNESS WHEREOF, each of the undersigned has executed this Amendment as of the date set forth above.
KARMAN HOLDING INC.,
as the Borrower
By: /s/Mike Willis______________________________
Name: Mike Willis
Title:Chief Financial Officer
[Signature Page to First Amendment to Credit Agreement]
OTHER LOAN PARTIES, SOLELY FOR PURPOSES OF SECTION 8 OF THE AMENDMENT:
KARMAN PARENT LLC
By:/s/Mike Willis_____________________
Name: Mike Willis
Title:Chief Financial Officer
KARMAN SPACE & DEFENSE LLC
By:/s/Mike Willis____________________
Name: Mike Willis
Title:Chief Financial Officer
AEROSPACE ENGINEERING, LLC
By:/s/Mike Willis______________________
Name:Mike Willis
Title:Chief Financial Officer
WOLCOTT DESIGN SERVICES LLC
By:/s/Mike Willis_______________________
Name: Mike Willis
Title:Chief Financial Officer
AMRO FABRIDATING CORPORATION
By:/s/Mike Willis_______________________
Name: Mike Willis
Title:Chief Financial Officer
[Signature Page to First Amendment to Credit Agreement]
AMERICAN AUTOMATED ENGINEERING, INC.
By:/s/Mike Willis______________________
Name: Mike Willis
Title:Chief Financial Officer
SYSTIMA TECHNOLOGIES, INC.
By:/s/Mike Willis_________________________
Name: Mike Willis
Title:Chief Financial Officer
[Signature Page to First Amendment to Credit Agreement]
CITIBANK, N.A.,
as Administrative Agent
By:/s/Carlos Bolanos ____________________________
Name: Carlos Bolanos
Title: Senior Vice President
[Signature Page to First Amendment to Credit Agreement]
CITIBANK, N.A.,
as a First Amendment Incremental Term Lender
By:/s/Carlos Bolanos
Name: Carlos Bolanos
Title: Senior Vice President
[Signature Page to First Amendment to Credit Agreement]
Schedule A
First Amendment Incremental Term Loan Commitments
First Amendment Incremental Term Lenders |
First Amendment Incremental Term Loan Commitments |
CITIBANK, N.A. |
$75,000,000.00 |
TOTAL |
$75,000,000.00 |
Exhibit 99.1
Karman Space & Defense Acquires Industrial Solid Propulsion (“ISP”), a Leading Supplier of Energetic Propulsion Technologies for Next-Generation UAS, UAS Intercept and Rocket-Assisted Takeoff Systems
HUNTINGTON BEACH, Calif., May 29, 2025 – Karman Space & Defense (“Karman”, “Karman Holdings, Inc.” or “the Company”) (NYSE: KRMN), a leader in the rapid design, development and production of critical, next-generation system solutions for launch vehicle, satellite, spacecraft, missile defense, hypersonic and UAS customers today announced it has acquired ISP, a leader in specialty energetic propulsion technologies including small boost motors and solid propellant gas generators for the rapidly growing UAS, UAS intercept and rocket-assisted takeoff systems markets. The transaction closed on May 28, 2025.
Founded in 1983 and based in Cedar City, Utah, ISP has developed a proprietary portfolio of propellant formulations and tactical motor configurations, with proven flight heritage across a number of high-priority U.S. Department of Defense (“DOD”) programs. ISP designs, tests, qualifies and manufactures small-diameter energetic and propulsion systems to meet mission requirements for distance, total impulse, peak thrust and burn time. With the required engineering and manufacturing capabilities to take a product from concept-to-production, ISP is a proven partner to prime customers in delivering integrated energetic and propulsion systems, with more than 40 years of flight heritage.
“We have been working collaboratively with ISP on a number of exciting opportunities for many months and believe that ISP is a natural, strategic fit within the Karman portfolio,” said Tony Koblinski, Karman Chief Executive Officer. “This acquisition strengthens our core competency in energetics, expands our offering in small-diameter solid propellant technologies and will allow us to serve our customers even better. ISP’s proprietary portfolio of propellant formulations and unique manufacturing capabilities furthers Karman’s mission of leveraging advanced technologies to drive agile solutions for customers across the space and defense market. We welcome the talented ISP team to Karman and look forward to working together to deliver even more value to our customers.”
ISP leverages its leading IP portfolio and full suite of in-house, small batch manufacturing capabilities to rapidly qualify and deliver efficient, technically optimal energetic systems. ISP’s full-service capabilities include propellant and cartridge design, grain formulation, mixing, machining, cartridge loading and hot-fire testing, ISP’s propulsion expertise in small-diameter systems and cartridges and its programmatic positions are well aligned with current and future funding priorities, specifically in deployment and launch systems for one-way loitering munitions, counter-UAS and intercept systems.
Additionally, ISP has a long history of supporting STEM-based educational curricula for schools, camps, clubs and youth organizations. Empowering the next generation of energetics and propulsion engineers with tools to help them experiment, learn and launch their careers is central to ISP and highly aligned with Karman’s approach to supporting local communities and identifying top talent.
On May 27, 2025, Karman successfully closed an offering to increase the size of its existing $300 million Term Loan B by $75 million. The majority of the proceeds from this offering were used to fund the acquisition of ISP, which consisted of $50 million in cash, approximately $5 million in Karman common shares and $5 million in potential earnout payments.
For more information on ISP, please visit www.specificimpulse.com.
Advisors
Citi served as exclusive financial advisor and Willkie Farr & Gallagher LLP served as legal advisor to Karman in connection with the transaction. KAL Capital served as financial advisor to ISP.
ABOUT KARMAN SPACE & DEFENSE
We specialize in the rapid design, development, and production of next-generation technologies to combat near-peer nation state threats, focused on critical, integrated systems for the hypersonic, missile defense, UAV and space sectors. Our core technology offerings include propulsion, deployable shrouds, launchers, and energetic subsystems. Customers choose our advanced solutions to deliver mission success across a diverse set of existing and emerging programs supporting high-priority defense and commercial space sector initiatives. For more information, visit Karman-SD.com.
Forward-Looking Statements
This announcement may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We intend all forward-looking statements to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally can be identified by the fact that they do not relate strictly to historical or current facts and by the use of forward-looking words such as “expect,” “expectation,” “believe,” “anticipate,” “may,” “could,” “intend,” “belief,” “plan,” “estimate,” “target,” “predict,” “likely,” “seek,” “project,” “model,” “ongoing,” “will,” “should,” “forecast,” “outlook” or similar terminology. These statements are based on and reflect our current expectations, estimates, assumptions and/ or projections, our perception of historical trends and current conditions, as well as other factors that we believe are appropriate and reasonable under the circumstances. Forward-looking statements are neither predictions nor guarantees of future events, circumstances or performance and are inherently subject to known and unknown risks, uncertainties and assumptions that could cause our actual results to differ materially from those indicated by those statements. There can be no assurance that our expectations, estimates, assumptions and/or projections, including with respect to the future earnings and performance or capital structure of Karman, will prove to be correct or that any of our expectations, estimates or projections will be achieved.
Numerous factors could cause our actual results and events to differ materially from those expressed or implied by forward-looking statements, including the factors described in the filings we make with the SEC from time to time and, without limitation, that a significant portion of our revenue is generated from contracts with the United States military and U.S. military spending is dependent upon the U.S. defense budget; U.S. government contracts are subject to a competitive bidding process that can consume significant resources without generating any revenue; our business and operations expose us to numerous legal and regulatory requirements, and any violation of these requirements could materially adversely affect our business, results of operations, prospects and financial condition; our inability to adequately enforce and protect our intellectual property or defend against assertions of infringement could prevent or restrict our ability to compete; and we have in the past consummated acquisitions and intend to continue to pursue acquisitions, and our business may be adversely affected if we cannot consummate acquisitions on satisfactory terms, or if we cannot effectively integrate acquired operations. Readers are directed to the risk factors identified in the filings we make with the SEC from time to time, copies of which are available free of charge at the SEC’s website at www.sec.gov under Karman Holdings Inc.
The forward-looking statements included in this announcement are only made as of the date of this announcement. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by any applicable law.
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