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): November 9, 2009
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Mercari
Communications Group, Ltd.
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(Exact
name of registrant as specified in its
charter)
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Colorado
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000-17284
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84-1085935
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(State or other jurisdiction of incorporation)
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(Commission
File Number)
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IRS
Employer Identification Number
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135
Fifth Avenue
10th
Floor,
New
York, New York 10010
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(Address
of principal executive offices)
(Zip
Code)
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Registrant's
telephone number, including area code: (212)
739-7700
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2525
East Cedar Avenue
Denver,
Colorado 80209
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(Former
name or former address if changed since last
report)
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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:
o Written
communications pursuant to Rule 425 under Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-14(c) under the Exchange Act (17 CFR
240.13e-4(c))
CURRENT
REPORT ON FORM 8-K
MERCARI
COMMUNICATIONS GROUP, LTD.
TABLE OF CONTENTS
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2
Section 1. Registrant’s Business and
Operations
Item
1.01. Entry into a Material Definitive Agreement
On November 9, 2009, Mercari
Communications Group, Ltd. (the “Company,” “Mercari,” “we,” “us” and “our”)
entered into and closed a Stock Purchase Agreement (the “Stock Purchase
Agreement”) with Diversified Private Equity Corporation, a privately-held
Delaware corporation (“DPEC”), and Kanouff, LLC (“KLLC”) and Underwood Family
Partners, Ltd. (“Partnership”), the two entities which, immediately prior to
closing, were the majority shareholders of the Company and which are controlled
by the officers and directors of the Company, which resulted in a change in
control of the Company (the “Stock Purchase”). In connection with the
Stock Purchase, DPEC purchased, and the Company sold, an aggregate of 43,822,001
shares of Common Stock for a purchase price of $43,822, or $0.001 per
share. In addition, DPEC purchased 200 shares of Common Stock from
KLLC and 200 shares of Common Stock from Partnership for a purchase price of
$180,000 payable to each selling shareholder, of which $105,000 was paid at
closing and $75,000 was previously paid in connection with a letter of intent
and related amendments.
The Stock Purchase Agreement contains
post-closing covenants whereby Mercari and DPEC agree to utilize their
commercially reasonable efforts to cause Mercari to (i) remain a Section 12(g)
reporting company in compliance with and current in its reporting requirements
under the Exchange Act; and (ii) cause all of the assets and business or equity
interest of DPEC, its subsidiaries and affiliated companies to be transferred to
Mercari and, in connection with such transactions, cause Mercari’s stock to be
distributed by DPEC to DPEC’s stockholders and the holders of equity interests
in the affiliated companies (“Reorganization Transaction”). In
connection with and contemporaneously with the Reorganization Transaction, it is
anticipated that Mercari and/or DPEC will seek to obtain at least
$10 million in gross proceeds from a financing (the
“Financing”). If the gross proceeds from the Financing exceed
$15 million at the time of the last closing of such financing, Mercari will
issue additional shares of Common Stock to DPEC at a purchase price of $.001 per
share as follows: (i) 18,164,560 additional shares if the amount
of the Financing is at least $15 million and less than $20 million; or
(ii) 34,058,550 additional shares if the amount of the Financing is
$20 million or more. After consummation of the Financing,
Mercari will seek to register for resale all of the shares issued in the
Financing and shares of Common Stock issued by Mercari from and after December
1, 2001 and prior to the date of the Stock Purchase
Agreement. Mercari will use its commercially reasonable efforts to
file the registration statement within 60 days after consummation of the
Reorganization Transaction (“Filing Date”) and to have the registration
statement become effective within 180 days after the Filing Date. If
the SEC requires Mercari to reduce the number of shares included under such
registration statement, any such reduction will first be made from the shares
issued in the Financing. The post-closing obligations of DPEC and
Mercari discussed herein are contingent upon DPEC’s good faith determination
that, after taking commercially reasonable efforts, the transactions are
feasible. Such determination shall take into account all relevant
material factors, including without limitation, then-current economic, financial
and market conditions.
Upon closing of the Stock Purchase,
Mercari experienced a change in control and a change in all the members of the
Board of Directors and executive officers as set forth below in Item 5.01 and
5.02 of this report.
The foregoing description of the Stock
Purchase Agreement does not purport to be complete and is qualified in its
entirety by reference to the Stock Purchase Agreement which is included as
Exhibit 10.1 and is incorporated herein by reference.
THIS
REPORT ON FORM 8-K IS NOT AN OFFER OF SECURITIES FOR SALE. ANY
SECURITIES ISSUED IN THE FINANCING DESCRIBED HEREIN WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED OR SOLD IN THE
UNITED STATES UNLESS REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
PURSUANT TO AN EXEMPTION FROM SUCH REGISTRATION.
Section 3. Securities and Trading Markets
Item
3.02 Unregistered Sales of Equity Securities
On November 9, 2009, pursuant to the
Stock Purchase Agreement described above, Mercari offered and sold 43,822,001
shares of its common stock to DPEC. Additionally, DPEC acquired 200
shares from KLLC and 200 shares from Partnership. As set forth above,
DPEC purchased the shares from the Company for a purchase price of $0.001 per
share, or $43,822, and purchased 200 shares each from KLLC and Partnership for
$180,000
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payable
to each selling shareholder. With respect to the purchase price paid
to each selling shareholder, DPEC paid $105,000 to each at closing and applied
$75,000 that had previously been paid to each selling shareholder in connection
with a letter of intent and related amendments, against the purchase price for
the shares. DPEC used its working capital to make the acquisition of
the shares. As set forth in Item 1.01 of this report, the Stock
Purchase Agreement contains post-closing covenants that provide for the future
issuance of additional shares of Common Stock to DPEC in connection with a
contemplated reorganization transaction, and contemporaneous financing, that may
occur in the future.
The offer and sale by the Company of
the common stock to DPEC was exempt from registration under the Securities Act
of 1933, as amended (the “Securities Act”), pursuant to Section 4(2)
thereof. The Company made this determination based on the
representations of DPEC which included, in pertinent part, that DPEC was an
“accredited investor” within the meaning of Rule 501 of Regulation D promulgated
under the Securities Act, that DPEC was acquiring the common stock for
investment purposes for its own account and not as nominee or agent, and not
with a view to the resale or distribution thereof, and that DPEC understood that
the common stock may not be sold or otherwise disposed of without registration
under the Securities Act or an applicable exemption therefrom.
Section 5. Corporate Governance and
Management
Item
5.01 Changes in Control of Registrant
Reference
is made to the disclosure set forth under Items 1.01, 3.02 and 5.02 of this
report, which disclosure is incorporated herein by reference.
The authorized capital stock of the
Company consists of 950,000,000 shares of common stock, par value $0.00001 per
share and 20,000,000 shares of preferred stock, par value $0.001 per
share. As of November 9, 2009, there were 1,589,399 shares of common
stock issued and outstanding and no shares of preferred stock issued and
outstanding. Immediately following the closing of the Stock Purchase
Agreement, there were 45,411,400 shares of common stock issued and
outstanding. Immediately following the closing of the Stock Purchase
Agreement, DPEC owned an aggregate of 43,822,401 shares of the Company’s common
stock out of the total of 45,411,400 shares of common stock issued and
outstanding at the closing, or approximately 96.5% of the Company’s issued and
outstanding shares.
Pursuant to the Stock Purchase
Agreement, we made the following changes to our Board of Directors and executive
officers:
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Immediately
prior to the consummation of the Stock Purchase, we increased the size of
our Board of Directors from two to five, and L. Michael Underwood and John
P. Kanouff, our current directors, appointed Scott L. Mathis, Julian Beale
and Peter Lawrence, as directors of the Company, effective at the
closing. After such new directors were appointed, Messrs.
Underwood and Kanouff resigned as members of our Board of
Directors.
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Mr.
Underwood resigned as President and Mr. Kanouff resigned as Secretary and
Treasurer, and our Board of Directors appointed Scott L. Mathis as Chief
Executive Officer and President, Ronald S. Robbins as Executive Vice
President and Chief Operating Officer, and Tim Holderbaum as Executive
Vice President, Chief Financial Officer, Treasurer and
Secretary.
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Information required by Item 5.01(a)(8)
of Form 8-K was previously reported in the Company’s Annual Report on Form 10-K
for the fiscal year ended May 31, 2009 and Quarterly Report on Form 10-Q for the
fiscal quarter ended August 31, 2009, and is incorporated herein by
reference.
Item 5.02 Departure of Directors or Certain Officers;
Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers
Reference is made to the disclosure set
forth under Items 1.01, 3.02 and 5.01 of this report, which disclosure is
incorporated herein by reference.
Effective as of the closing of the
Stock Purchase Agreement, Messrs. Kanouff and Underwood, the existing officers
and directors of the Company, resigned, and the following officers and directors
were appointed:
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Name
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Age
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Position
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Scott
L. Mathis
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47
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Chief
Executive Officer, President and Chairman of the Board
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Ronald
S. Robbins
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Executive
Vice President and Chief Operating Officer
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Tim
Holderbaum
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Executive
Vice President, Chief Financial Officer, Treasurer and
Secretary
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Julian
Beale
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Director
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Peter
Lawrence
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75
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Director
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Scott L.
Mathis. Mr. Mathis is currently the Chief Executive Officer,
President, Treasurer, Secretary and Chairman of the Board of
DPEC. Immediately before launching DPEC in 1999, Mr. Mathis worked as
a registered representative for National Securities Corporation from July 1998
to June 2000, and before that The Boston Group, L.P. from August 1995 to July
1998. Mr. Mathis’ prior experience in investments and management is
extensive. He has been a partner at Oppenheimer and Company and a
Senior Vice President and member of the Directors Council at Lehman
Brothers. Mr. Mathis also worked with Alex. Brown & Sons and was
responsible for the management of the Palm Beach, Florida office of Gruntal and
Company, Inc. He began his career as a financial consultant and
broker with Merrill Lynch. Mr. Mathis received a Bachelor of Science
degree in Business Management from Mississippi State University. Mr.
Mathis also serves on the Boards of Directors of The Vaccine Company and
AmpliMed Corp.
Ronald S.
Robbins. Mr. Robbins currently serves as Executive Vice
President and Chief Operating Officer of DPEC and has been with the firm since
2001. From June 1999 to April 2001, he served as Senior Managing
Director of Josephthal & Co., Inc. From June 1995 to August 2001,
he was a partner in the firm Redeker, Robbins & Webber. Prior to
that, his 39 years in the financial services industry included: Chairman and
CEO, Liberty Securities Corporation; President, Liberty Financial Bank Group;
President, SunAmerica Capital Services; Executive Vice President, SunAmerica
Asset Management; and Senior Vice President, Monarch Financial
Services. He has also served in consulting relationships with various
major firms. Mr. Robbins received a Bachelor of Science in
Journalism/Communications from Temple University.
Tim
Holderbaum. Mr. Holderbaum currently serves as Executive Vice
President and Chief Financial Officer of DPEC and has been with DPEC since July
2001. He is responsible for the operational and financial aspects of
DPEC and InvestBio, including day-to-day operations, filings, accounting and
auditing, and the operational management and structuring of InvestBio’s
investment partnerships. He also presently serves as the Financial
and Operations Principal of DPEC Capital, Inc. and Managing Director and
Co-founder of InvestProperty Group, LLC. Prior to joining DPEC, Mr.
Holderbaum was the Director of International Affairs for Impact Media, Ltd.
where he coordinated and managed several focused special-advertising sections
for various international markets. His career began at Burmah Oil in
Hamburg, Germany where his responsibilities involved the forecasting and
budgeting for 13 Central and Eastern European countries. Mr.
Holderbaum attended Northwood University where he received a Bachelor of
Business Administration degree.
Julian
Beale. Since 1996, Mr. Beale has managed his own investments,
which include listed “blue chip” shares, numerous speculative stocks, and real
estate. After 14 years in engineering and after forming a plastics
processing company that he built to employ more than 200 people, Mr. Beale has
since the early 1970’s been involved in consulting and investing. In
1977, he was part of a consortium that purchased what became the Moonie Oil
Company, a resources corporation that had interests in petroleum
production. In 1984, he entered Federal Parliament (Australia).
During 11 years in politics, he held many Shadow Minister portfolios (i.e.,
cabinet level position with minority party). He has a B.E. degree
from Sydney University, Australia and an MBA from Harvard
University.
Peter
Lawrence. Mr. Lawrence served as the Chairman of Associated
British Industries plc, a company that manufactured car engine and aviation
jointing and sealants for both, original equipment manufacturers and
after-markets, specialty waxes and anti-corrosion coatings for the automotive
tire and plastics industries. The company was acquired for £40
million by AlliedSignal Corp in 1995. Mr. Lawrence has also serves as
a director of the Close Beacon Fund OEIC since its founding in
1994. Beacon invests in small and recently floated companies on the
Alternative Investment Market of the London Stock Exchange. Over the
last several years, Mr. Lawrence has participated in numerous start-up and
entrepreneurial ventures, both as an investor and as a member of
the
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companies’
Board of Directors or Board of Advisors. Mr. Lawrence received a B.A.
in Modern History from Oxford University where he graduated with
honors.
There
are no family relationships among any of our newly appointed officers and
directors and, otherwise than in connection with the Stock Purchase Agreement
and related transactions, such individuals have no material relationships or
reportable transactions with Mercari under Item 404(a) of Regulation
S-K.
As
of the date of this report, Mercari does not compensate any of its officers and
directors for their service and has not entered into any compensatory
arrangements in connection with the Stock Purchase Agreement or the appointment
of the new officers and directors.
Section 9. Financial Statements and Exhibits
Item
9.01 Financial Statements and Exhibits
(d) Exhibits
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Exhibit
No.
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Description
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10.1
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Stock
Purchase Agreement by and among Diversified Private Equity Corporation and
Mercari Communications Group, Ltd. and Kanouff, LLC and Underwood Family
Partners, Ltd., dated November 9,
2009.
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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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MERCARI
COMMUNICATIONS GROUP, LTD.
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Dated: November
10, 2009
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By:
/s/ Scott L.
Mathis
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Scott
L. Mathis
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Chief
Executive Officer, President and Chairman of the
Board
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MERCARI
COMMUNICATIONS GROUP, LTD.
EXHIBIT
INDEX
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Exhibit
No.
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Description
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10.1
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Stock
Purchase Agreement by and among Diversified Private Equity Corporation and
Mercari Communications Group, Ltd. and Kanouff, LLC and Underwood Family
Partners, Ltd., dated November 9,
2009.
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