Velocity Asset Management Inc (Other) (8-K)
September 27 2007 - 5:25PM
Edgar (US Regulatory)
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) September 27, 2007
(September 26, 2007)
VELOCITY ASSET MANAGEMENT, INC.
(Exact name of registrant as specified in Charter)
DELAWARE 000-61570 65-0008442
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(State of other Jurisdiction (Commission file no.) (IRS employer
of incorporation) identification no.)
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1800 ROUTE 34 NORTH, BUILDING 4, SUITE 404B WALL, NJ 07719
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (201-760-6306)
N/A
(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. below:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On September 26, 2007, Velocity Asset Management, Inc. (the "Company")
consummated an initial closing (the "Closing") of its private placement offering
(the "Offering") of shares of common stock (the "Shares") and warrants to
purchase shares of common stock (the "Warrants", together with the Shares, the
"Securities") to accredited investors ("Investors"). The Securities are being
offered and sold pursuant to an exemption from registration under Section 4(2)
of the Securities Act of 1933, as amended (the "Securities Act"). In connection
with the Offering, the Company issued the Securities and also entered into a
Securities Purchase Agreement and a Registration Rights Agreement with the
investors in the Offering (the "Investors"). The Registrant sold an aggregate of
675,000 Shares at a purchase price of $2.00 per Share and delivered Warrants to
purchase an aggregate of 135,000 shares of the Company's common stock. Net
proceeds from the financing are to be used primarily for working capital
purposes including, but not limited to, the purchase of distressed consumer
receivable portfolios.
The Warrants entitle the holders to purchase shares of the Company's
common stock reserved for issuance thereunder (the "Warrant Shares") for a
period of three years from the date which is six months after the date of
issuance at an exercise price of $2.50 per share. The Warrants contain certain
anti-dilution rights on terms specified in the Warrants. In addition, pursuant
to the Securities Purchase Agreement, the Investors will be entitled to
additional shares of common stock if, during the six month period after the
Closing, the Company sells or issues additional shares of Common Stock, or
securities (debt and/or equity) convertible into common stock, with a purchase,
exercise or conversion price of less than the $2.00.
Pursuant to the Registration Rights Agreement, the Company agreed to file
with the Securities and Exchange Commission a registration statement on
appropriate form providing for the resale by the investors of the Shares and the
Warrant Shares. The Company agreed to file the registration statement within 45
days of Closing. If such Registration Statement is not filed within the required
timeframe, or does not become effective within the required timeframe, or does
not remain effective for any thirty (30) consecutive days, the Company has
agreed to pay to the investors in the Offering liquidated damages for each
thirty (30) day period in which the Registrant fails to comply with such
requirements, all as more specifically provided in the Securities Purchase
Agreement.
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, AND ARE BEING
OFFERED AND SOLD ONLY IN THE UNITED STATES TO "ACCREDITED INVESTORS" (AS DEFINED
IN RULE 501(a) OF THE SECURITIES ACT) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER SECTION 4(2) OF THE SECURITIES ACT. NEITHER THE SECURITIES AND EXCHANGE
COMMISSION (THE "SEC") NOR ANY STATE SECURITIES COMMISSION OR REGULATORY BODY
HAS APPROVED OR DISAPPROVED THE SECURITIES. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
ITEM 3.02. UNREGISTERED SALES OF EQUITY SECURITIES
See Item 1.01 of this Current Report on Form 8-K, which Item is incorporated
herein by this reference, for a description of the terms of the financing
transaction that included the issuance of the Securities.
The Company received net proceeds of $ 1,244,000 from the placement, after
payment of offering expenses of approximately $25,000 and commissions of
approximately $60,000. The Company retained a registered FINRA broker dealer to
act as placement agent. In addition, the placement agent is entitled to receive
year warrants to acquire 30,000 shares of the Company's common stock.
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ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits.
Exhibit No. Description
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4.1 Form of Warrant
10.1 Form of Registration Rights Agreement
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This Current Report on Form 8-K may contain, among other things, certain
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995, including, without limitation, (i) statements
with respect to the Company's plans, objectives, expectations and intentions;
and (ii) other statements identified by words such as "may", "could", "would",
"should", "believes", "expects", "anticipates", "estimates", "intends", "plans"
or similar expressions. These statements are based upon the current beliefs and
expectations of the Company's management and are subject to significant risks
and uncertainties. Actual results may differ from those set forth in the
forward-looking statements. These forward-looking statements involve certain
risks and uncertainties that are subject to change based on various factors
(many of which are beyond the Company's control).
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.
VELOCITY ASSET MANAGEMENT, INC.
/s/ James Mastriani
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James Mastriani
Chief Financial Officer
DATED: SEPTEMBER 27, 2007
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