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): January 11, 2013
CHANCELLOR GROUP, INC.
(Exact name of registrant as specified in its charter)
NEVADA 000-30219 87-0438647
(State or other jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
500 TAYLOR STREET, PLAZA TWO - SUITE 200
AMARILLO, TX 79101
(Address of principal executive offices)
(806) 322-2731
(Registrant's telephone number, including area code)
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 January 11, 2013, Chancellor Group, Inc., a Nevada corporation
("Chancellor"), entered into a binding term sheet (subject to closing
conditions) regarding the establishment of a 61% Chancellor-owned Delaware
company ("Pimovi") recently formed by Chancellor whose main proposed business
will be information technology.
Under the agreement, Chancellor agreed to provide finance of $250,000 over a
period of approximately eight months in Pimovi, Inc., a newly-formed Delaware
corporation, in consideration for the receipt of 61% of the equity of Pimovi in
the form of Series A Preferred Stock. The other party to the term sheet is
Kasian Franks (the "Co-Founder"), who is to become Chief Scientific Officer of
Pimovi and contribute certain intellectual property related to its business in
consideration for receipt of the remaining equity in Pimovi in the form of
common stock. The Co-Founder will also receive one million shares of
Chancellor's common stock at closing and be eligible to receive an additional
one million shares of Chancellor's common stock subject to the achievement of
certain milestones to be determined.
The proposed business of Pimovi relates largely to the technology and mobile
applications fields.
Pursuant to the term sheet, Chancellor will receive various investor rights with
respect to its investment in Pimovi, which provisions shall be contained in the
amended certificate of incorporation of Pimovi and certain shareholder
agreements, including but not limited to a liquidation preference in the amount
of its investment, the right to select a majority of Pimovi's board of
directors, and a right of first refusal to invest in future equity issuances of
Pimovi.
The term sheet is binding by its terms but is subject to certain conditions to
closing, including completion of further legal due diligence and entering into
definitive agreements with the Co-Investor and Pimovi's employees and
consultants.
2
SIGNATURE
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.
CHANCELLOR GROUP, INC.
Date: January 15, 2013 By: /s/ Maxwell Grant
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Maxwell Grant
Chief Executive Officer
