8-K

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): February 9, 2005

ISCO INTERNATIONAL, INC.

(Exact Name of Issuer as Specified in Charter)

DELAWARE	000-22302	36-3688459
(State or Other Jurisdiction of Incorporation or Organization)	(Commission File Number)	(I.R.S. Employer Identification Number)

1001 Cambridge Drive, Elk Grove Village, ILLINOIS 60007

(Address of Principal Executive Offices)

(847) 391-9400

(Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

Item 1.01 Entry into a Material Definitive Agreement.

On February 10, 2005, ISCO International, Inc. (the “Company”), Manchester Securities Corporation, Alexander Finance, L.P., Spectral Solutions, Inc. and Illinois Superconductor Canada Corporation amended the terms of their November 10, 2004 Third Amended and Restated Loan Agreement, to reflect (i) the extension of the termination and maturity dates for the notes evidencing the loans to April 1, 2006; (ii) that commencing on April 1, 2005, interest (other than default interest) will accrue on the notes evidencing the loans at the rate of the lesser of 9% per annum or the highest rate permitted by law; and (iii) corresponding amendments to the terms of the Third Amended and Restated Security Agreement and the Third Amended and Restated Guaranties, both of which were entered into by the parties on November 10, 2004.

No warrants or other inducements were issued as a result of the amendments to the financing.

A copy of the press release dated February 10, 2005, that included the announcement of the amendments to the financing is attached to this Current Report as Exhibit 99.1.

Item 5.02 Departure of Director or Principal officer, Election of Directors, Appointment of Principal Officers.

On February 9, 2005, the Board of Directors (the “Board”) of the Company voted to increase the size of the Board from seven (7) to eight (8) members. In addition, the Board appointed Mr. John S. Thode, the Company’s President and Chief Executive Officer, as a Director, to fill the newly created directorship. Mr. Thode will hold office until the next annual meeting of stockholders and until his successor is duly elected and qualified.

The Company previously disclosed the hiring of Mr. Thode as the Company’s President and Chief Executive Officer in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 12, 2005 (the “January 12 8-K”). Pursuant to the Letter Agreement (the “Employment Agreement”) between the Company and Mr. Thode, dated January 6, 2005, Mr. Thode’s annual base salary will be $225,000. In addition, Mr. Thode was also granted non-qualified options to purchase up to 1,550,000 shares of the Company’s common stock. The options were issued outside of the Company’s 2003 Equity Incentive Plan, but were nonetheless subject to terms substantially identical to the 2003 Equity Incentive Plan. The option will vest with respect to 62,500 shares on the last day of each of the 12 calendar months ending after the grant date (or, if sooner, upon a change in control of the Company), provided that Mr. Thode is still employed by the Company through the applicable vesting date. The option will vest with respect to 400,000 of the remaining 800,000 shares if the Company achieves certain quarterly and annual revenue objectives and 400,000 of the remaining 800,000 shares if the Company achieves certain quarterly and annual cash flow objectives during the 2005 fiscal year and Mr. Thode remains employed by the Company through the applicable vesting date. The option will have an exercise price equal to $0.43 per share, which was the closing price of the Company’s common stock on the date of grant, which was January 11, 2005. The option expires ten years from the date of grant, unless earlier terminated.

If Mr. Thode’s employment is terminated: (1) by Mr. Thode’s death or disability, Mr. Thode or his estate or personal representative will be entitled to exercise the option, the extent vested at the time of his termination, for up to a year after his death or termination due to disability; (2) by the Company for cause, any portion of the option not already exercised will be immediately and automatically forfeited; or (3) for any other reason, the option may be exercised, to the extent vested at the time of his termination, for up to 90 days following his termination.

The description of the Employment Agreement with Mr. Thode is qualified by reference to the complete letter agreement and non-qualified stock option award agreement attached to the January 12 8-K as Exhibit 10.2 and which are incorporated herein by reference.

A copy of the press release dated February 10, 2005, that included the announcement of Mr. Thode’s appointment to the Board is attached to this Current Report as Exhibit 99.1.

Item 9.01. Financial Statements and Exhibits.

(c)	Exhibit No.	Description
	10.1	Amendment to Loan Documents, dated February 10, 2005 by and among Manchester Securities Corporation, Alexander Finance, L.P., ISCO International, Inc., Spectral Solutions, Inc, and Illinois Superconductor Canada Corporation.*
	10.2	Letter Agreement dated January 6, 2005 between ISCO International, Inc. and John S. Thode (including Non-Qualified Stock Option Award Agreement).**
	99.1	Press Release of ISCO International, Inc. dated February 10, 2005*

* Filed herewith.

** Previously filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the securities and Exchange Commission on January 12, 2005 and incorporated herein by reference.

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.

	ISCO INTERNATIONAL, INC.
Date: February 15, 2005	By:	/s/ Frank Cesario
		Frank Cesario
		Chief Financial Officer

Index of Exhibits

Exhibit No.	Description
10.1	Amendment to Loan Documents, dated February 10, 2005 by and among Manchester Securities Corporation, Alexander Finance, L.P., ISCO International, Inc., Spectral Solutions, Inc, and Illinois Superconductor Canada Corporation.*
10.2	Letter Agreement dated January 6, 2005 between ISCO International, Inc. and John S. Thode (including Non-Qualified Stock Option Award Agreement).**
99.1	Press Release of ISCO International, Inc. dated February 10, 2005*

* Filed herewith.

** Previously filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the securities and Exchange Commission on January 12, 2005 and incorporated herein by reference.

EX-10.1

Exhibit 10.1

AMENDMENT TO

LOAN DOCUMENTS

AMENDMENT TO LOAN DOCUMENTS, dated as of February 10, 2005, by and among Manchester Securities Corporation, a New York corporation (“Manchester”), Alexander Finance, L.P. an Illinois limited partnership (“Alexander” and together with Manchester, the “Lenders”), ISCO International, Inc., a Delaware corporation (the “Company”), Spectral Solutions, Inc., a Colorado corporation (“Spectral”) and Illinois Superconductor, a Canada corporation, an Ontario corporation (“ISCO Canada” and together with Spectral, the “Guarantors”).

W I T N E S S E T H

WHEREAS, pursuant to a certain Third Amended and Restated Loan Agreement, dated as of November 10, 2004 (the “Loan Agreement”), by and among the Lenders and the Company, the Lenders have provided loan commitments to the Company in the aggregate principal amount of $8,500,000;

WHEREAS, to evidence borrowing made under the Loan Agreement (and its predecessor agreements), the Company has issued notes (the “Notes”) to the Lenders;

WHEREAS, the Notes and certain other obligations have been guaranteed by the Guarantors, who are subsidiaries of the Company, each such guaranty being made pursuant to separate Third Amended and Restated Guaranties dated as of November 10, 2004 (the “Guaranties”);

WHEREAS, the Notes and certain other obligations have been secured by the assets of the Company and the Guarantors pursuant to a certain Third Amended and Restated Security Agreement, dated as of November 10, 2004, by and among the Company, the Lenders and the Guarantors (the “Security Agreement”, and together with the Loan Agreement, the Notes, and the Guaranties, the “Loan Documents”); and

WHEREAS, the parties desire that the terms of the Loan Documents be modified.

NOW, THEREFORE, in consideration of the foregoing premises and the covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows (capitalized terms used and not defined herein shall have the meaning set forth in the Loan Agreement):

1. Repayment Dates; Maturity of Notes. The Termination Date and Maturity Dates (as defined in each of the Notes) for all the Notes shall be extended to April 1, 2006.

2. Interest on the Notes. Commencing on April 1, 2005, interest (other than default interest) shall accrue on each of the Notes at the rate of the lesser of 9% per annum or the highest rate permitted by law and shall otherwise be calculated as set forth in such Note.

3. Amendment to the Loan Agreement.

(a) The words “April 1, 2005” are hereby deleted from the first line of Section 1.4.

(b) The definition of “Permitted Liens” in Section 4.3 shall be amended to include liens granted under the Security Agreement, as amended by this Agreement.

4. Amendment of Security Agreement and Guaranties.

(a) The Security Agreement is hereby amended by modifying the term “Obligations,” as defined in Section 2 of the Security Agreement, to refer to the Loan Agreement, 2002 Notes, 2003 Notes, July 2004 Notes, November 2004 Notes and Restated Guaranties (all as defined therein) as modified by this Agreement.

(b) Each of the Guaranties is modified such that the definition of “Obligations” in Section 1(a) thereof, is hereby amended to include the Notes, the Loan Agreement and Security Agreement (as such terms are defined in the Guaranties) as amended by this Agreement.

5. Representations and Warranties. The Company hereby restates the representations in Section 2.1 of the Loan Agreement and Section 3 of the Security Agreement, as of the date hereof (other than the representation in Section 2.1(g) of the Loan Agreement, which is made as of the date of the Loan Agreement). The Guarantors hereby restate their respective representations in Section 3 of the Security Agreement and Section 8 of the Guaranties, as of the date hereof. The Lenders hereby restate their representations in Section 2.2 of the Loan Agreement, as of the date hereof.

6. Press Release. Concurrently with the execution of this Agreement, the Company shall issue the press release in the form of Exhibit A attached hereto.

7. Miscellaneous.

(a) As modified hereby, the Loan Documents shall remain in full force and effect.

(b) The Company shall, upon request of the Lenders, reimburse them for their legal expenses incurred in the preparation of this Agreement and for related transactions.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered by their respective officers thereunto duly authorized, as of the date first above written.

ISCO INTERNATIONAL, INC.
By:	/s/ John S. Thode
Name:	John Thode
Title:	Chief Executive Officer
SPECTRAL SOLUTIONS, INC.
By:	/s/ John S. Thode
Name:	John Thode
Title:	Chief Executive Officer
ILLINOIS SUPERCONDUCTOR CANADA CORPORATION
By:	/s/ John S. Thode
Name:	John Thode
Title:	Chief Executive Officer
MANCHESTER SECURITIES CORPORATION
By:	/s/ Elliot Greenberg
Name:	Elliot Greenberg
Title:	Vice President
ALEXANDER FINANCE, L.P.
By:	/s/ Bradford Whitmore
Name:	Bradford Whitmore
Title:	President, Bun Partners, Inc., its General Partner

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COLLATERAL AGENT

UNDER SECURITY AGREEMENT:

MANCHESTER SECURITIES CORPORATION
By:	/s/ Elliot Greenberg
Name:	Elliot Greenberg
Title:	Vice President

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EX-99.1

Exhibit 99.1

News Release CONTACT: Mr. Frank Cesario, PHONE: 847-391-9492 INTERNET: iscoir@iscointl.com

ISCO INTERNATIONAL REPORTS ELECTION OF JOHN THODE TO BOARD

OF DIRECTORS AND CREDIT LINE EXTENSION

Elk Grove Village, IL (February 10, 2005) – ISCO International, Inc. (AMEX: ISO), a leading global supplier of interference-control solutions for the wireless telecommunications industry, today reported the election of Mr. John Thode to the Company’s Board of Directors and the extension of its credit line to 2006.

During January, ISCO announced the addition of John Thode as President and Chief Executive Officer. On February 9^th, Mr. Thode was elected to the Company’s Board of Directors.

Additionally, ISCO and its lenders agreed to an extension of the existing credit line that was scheduled to be due April 1, 2005. The line has been extended for one year, to April 1, 2006. The rate of interest during the extension period will be 9%. No warrants or other inducements were issued as a result of this financing.

“Securing adequate working capital is critical to the execution of any business plan, ours included,” said Mr. Thode. “I’m pleased that we were successful in negotiating this extension with our lenders. I believe it reflects well on some of the significant strides that ISCO has made, and the potential of this company going forward.”

Safe Harbor Statement

Because the Company wants to provide investors with meaningful and useful information, this news release contains, and incorporates by reference, certain “forward-looking statements” that reflect the Company’s current expectations regarding the future results of operations, performance and achievements of the Company. The Company has tried, wherever possible, to identify these forward-looking statements by using words such as “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends” and similar expressions. These statements reflect the Company’s current beliefs and are based on information currently available to it. Accordingly, these statements are subject to certain risks, uncertainties and contingencies, which could cause the Company’s actual results, performance or achievements to differ materially from those expressed in, or implied by, such statements. These factors include, among others, the following: the Company’s ability to obtain current financing to sustain operations, market acceptance of the Company’s technology; the spending patterns of wireless network operators in connection with the build out of 2.5G and 3G wireless systems; the Company’s ability to obtain additional financing in the future; the Company’s history of net losses and the lack of assurance that the Company’s earnings will be sufficient to cover fixed charges in the future; uncertainty about the Company’s ability to compete effectively against better capitalized competitors and to withstand downturns in its business or the economy generally; continued downward pressure on the prices charged for the Company’s products due to the

competition of rival manufacturers of front-end systems for the wireless telecommunications market; the timing and receipt of customer orders; the Company’s ability to attract and retain key personnel; and the effects of legal proceedings. A more complete description of these risks, uncertainties and assumptions is included in the Company’s filings with the Securities and Exchange Commission, including those described under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K, as amended. You should not place undue reliance on any forward-looking statements. The Company undertakes no obligation to release publicly the results of any revisions to any such forward-looking statements that may be made to reflect events or circumstances after the date of this Report or to reflect the occurrence of unanticipated events.

Web site: http://www.iscointl.com