Attached files
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): October 15,
2009
__________
Z
TRIM HOLDINGS, INC.
(Exact
name of registrant as specified in its charter)
|
Illinois
|
001-32134
|
36-4197173
|
|
(State
or other jurisdiction of incorporation or organization)
|
(Commission
file number)
|
(I.R.S.
employer identification no.)
|
|
1011
Campus Drive
Mundelein,
IL 60060
(Address
of principal executive offices)
|
60060
(Zip
code)
|
Registrant’s
telephone number, including area code: (847) 549-6002
Not
Applicable
(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.
Item
3.02 Unregistered
Sales of Equity Securities.
On
October 15, 2009, we entered into a private placement subscription agreement
with Brightline Ventures I, LLC, a Delaware Limited Liability Company(the
“purchaser” or “Brightline”) pursuant to which we sold 185.25 units consisting
of convertible notes and warrants, for an aggregate offering price of
$1,852,500. Furthermore, since July 14, 2009, we had sold an
additional 75.3 units for an aggregate offering price of $753,000, including a
total of $660,000 sold to affiliates of Brightline. Each of the units
(individually, a “Unit” and collectively, the “Units”) consists of a $10,000
24-month senior secured promissory note (each a “Note” and collectively the
“Notes”) convertible at the rate of $1.00 per share into 10,000 shares of our
common stock, $.00005 par value (the “Common Stock”), bearing interest at the
rate of 8% per annum, which interest is accrued annually in Common Stock at the
rate of $1.00 per share. The Notes will be secured by a first lien on
all of our assets for so long as the Notes remain outstanding pursuant to the
form of Security Agreement filed as an exhibit to this report (the “Security
Agreement”). The Notes are convertible into a total of 2,605,500
shares of Common Stock. The interest is payable quarterly or upon
maturity of the Notes. The Investors also received one five-year
warrant for each Unit purchased, to purchase 15,000 shares of Common Stock per
unit with an exercise price of $1.50 per share (“Warrants”). The
total warrants issued to the purchaser and its affiliates were
3,768,750. The Company has agreed to pay a finder cash commissions
aggregating 8% of the gross proceeds of the offering sold to an investor
introduced by that finder up to a maximum of 250 Units purchased by such
investor and an equal amount of five year warrants at an exercise price of $1.50
per share (for example, if the finder’s fee equals $200,000, then the finder
will also receive 200,000 warrants with an exercise price of
$1.50). The Company has reserved the right to negotiate a lower
commission for any Units above the 250 purchased by such investor. The terms and
conditions of the Units are substantially identical to the terms and conditions
and constitute a part of the units previously sold by us in 2009 and reported on
a Form 8-K filed by us on April 21, 2009 (the “2009 Units”). The
amount of Units purchased by Brightline and its affiliates, represents at least
a majority of all of the Units and the 2009 Units taken as a whole, and,
consequently, under the terms of the Notes, the purchaser has the ability,
together with us to amend the Notes and Security Agreements comprising the Units
and the 2009 Units. In consideration of Brightline’s (and its
affiliates’) purchase of Note Units in the amount of $2,512,500 pursuant to the
terms of the Note Memorandum, the Company granted to Brightline, the right to
purchase additional Note Units and/or Preferred Stock Units, as available, up to
an additional aggregate amount of $2,487,500.
Pursuant
to the terms of the subscription agreement we agreed with the Purchaser to amend
the Units (the “Amended Units”) to reflect the terms and conditions of the Units
sold by us in 2008 (the “2008 Units”) as described in our Current Reports on
Form 8-K filed on June 24 and September 2, 2008 which include among other things
a full ratchet anti-dilution formulation with respect to the adjustments to the
conversion price of the Notes and the exercise price of the Warrants
instead of the weighted average anti-dilution formula contained in the Units and
the payment of interest on the Notes, at the option of the holder, quarterly or
at maturity rather than just at maturity. As a result of the
amendment, all of the Notes and the 2009 Notes and corresponding Security
Agreements will be amended to read as set forth in Exhibits 4.2 and 4.4 attached
hereto. The Warrants sold to the purchaser have also been
amended. We also agreed to offer to amend the warrants and
to offer a registration rights agreement to the noteholders under the 2009 Units
on terms identical to those granted to the purchaser. The Notes, the
Amended and Restated Notes (including the Notes issued as part of the 2009
Units) and Notes issued as part of the 2008 Units rank pari passu with each
other.
We also
entered into registration rights agreements substantially similar to the
registration rights agreement entered into with the purchasers of the 2008 Units
pursuant to which we have agreed to file with the Securities and Exchange
Commission a registration statement covering the resale of the Common Stock
underlying the Amended and Restated Notes and the Amended and Restated
Warrants.
Provided
certain conditions, as set forth in the Subscription Agreement, are met, we
agreed to use our reasonable best efforts to nominate a representative of the
purchaser for election to our Board of Directors and we also agreed subject to
certain conditions to permit an observer designated by the purchaser to attend
meetings of the Board.
The
descriptions herein are qualified in their entirety by reference to the copies
of the forms of the Subscription Agreement, the Amended and Restated Notes, the
Amended and Restated Warrant, the Amended and Restated Security Agreements and
the Registration Rights Agreement which are attached as exhibits
hereto.
We
determined that all of the securities sold and issued in the private placement
were exempt from registration under the Securities Act of 1933, as amended (the
“Act”) pursuant to Section 4(2) of the Act and Rule 506 of Regulation D
promulgated under the Act. We based this determination on the
non-public manner in which we offered the securities and on the representations
of the persons purchasing such securities, which included, in pertinent part,
that such persons were “accredited investors” within the meaning of Rule 501 of
Regulation D promulgated under the Act, and that such persons were acquiring
such securities for investment purposes for their own respective accounts and
not as nominees or agents, and not with a view to resale or distribution, and
that each such person understood such securities may not be sold or otherwise
disposed of without registration under the Act or an applicable exemption
therefrom.
The
description of the terms of sale of the securities described in this report is
qualified in its entirety by reference to the full text of the underlying
documents which have been filed as exhibits to this report.
Item
9.01. Financial Statements and Exhibits.
(d)
Exhibits.
|
No.
|
Description
|
|
4.1
|
Form
of Subscription Agreement
|
|
4.2
|
Form
of Amended and Restated Convertible Promissory Note
|
|
4.3
|
Form
of Amended and Restated Warrant to Purchase Common
Stock
|
|
4.4
|
Form
of Amended and Restated Security Agreement
|
| 4.5 | Form of Registration Rights Agreement |
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 thereunto
duly authorized.
|
Z
TRIM HOLDINGS, INC.
|
|||
|
Date: October
16, 2009
|
By:
|
/s/ Steve
Cohen
|
|
|
Name:
Steve Cohen
|
|||
|
Title: President
|
|||
INDEX TO
EXHIBITS
|
No.
|
Description
|
|
4.1
|
Form
of Subscription Agreement
|
|
4.2
|
Form
of Amended and Restated Convertible Promissory Note
|
|
4.3
|
Form
of Amended and Restated Warrant to Purchase Common
Stock
|
| 4.4 | Form of Amended and Restated Security Agreement |
| 4.5 | Form of Registration Rights Agreement |