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
September 27, 2017
Date of
Report (Date of Earliest Event Reported)
NOVUME SOLUTIONS, INC.
(Exact
Name of Small Business Issuer as Specified in Its
Charter)
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Delaware
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000-55833
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81-56266334
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(State
or other jurisdiction of
incorporation
or organization)
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(Commission
File
Number)
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(I.R.S.
Employer
Identification
Number)
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14420 Albemarle Point Place, Suite 200,
Chantilly, VA, 20151
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(Address
of Principal Executive Offices)
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(703) 953-3838
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(Issuer’s
Telephone Number, Including Area Code)
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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 (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))
Indicate
by check mark whether the registrant
is an emerging growth company as defined in in Rule 405 of
the Securities Act of 1933 (§230.405 of this chapter) or Rule
12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of
this chapter).
Emerging
growth company ☐
If an
emerging growth company, indicate by checkmark if the registrant
has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act.
☐
Item 2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.
On
September 29, 2017, Novume Solutions, Inc., a Delaware corporation
(the “Company”), assumed from
KeyStone Solutions, LLC, a Delaware limited liability company and
wholly-owned subsidiary of the Company (“KeyStone”), four
unsecured subordinated promissory notes made by KeyStone
(collectively, the “Notes”), representing
$1,000,000 in aggregate outstanding principal balance.
The
Notes comprise:
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a promissory note in
favor of Lancer Financial Group, Inc., an Illinois corporation
(“Lancer”),
having an outstanding principal amount of
$500,000;
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a promissory note in favor of Suzanne Loughlin, having an
outstanding principal amount of $166,667;
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a promissory note in favor of James W. Satterfield, having an
outstanding principal amount of $166,667; and
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a promissory note in favor of Harry Rhulen, having an outstanding
principal amount of $166,666.
The
Company assumed each such Note under an Assignment and Assumption
Agreement (the “Assignment Agreement”),
dated September 27, 2017, by and between the Company and KeyStone.
Upon consummation of the assignment, the Company issued replacement
notes (the “Replacement Notes”) to
each of the holders having substantially similar terms to the
Notes.
Each
Replacement Note matures over a period that ends on January 25,
2022. The unpaid principal balance of the Replacement Notes issued
to Mr. Rhulen, Ms. Loughlin and Mr. Satterfield accrues simple
interest at a rate of 2% per annum; and the unpaid principal
balance of the Replacement Note issued to Lancer accrues simple
interest at a rate of 7% per annum. There is no accrued and unpaid
interest on any of the Notes as of the date of this report. Our
payment obligations with respect to the Replacement Notes are
subordinated to our obligations to Avon
Road Partners, L.P. (“Avon
Partners”), an affiliate
of Mr. Robert Berman, our Chief Executive Officer, under a
promissory note, dated March 16, 2016, with an outstanding
principal amount of $500,000 (the “Avon
Road Note”). The terms of
the Avon Road Note are more fully described in our response to Item
1.01 of the Current Report on Form 8-K filed with the
Securities and Exchange Commission (the “SEC”) on August 29, 2017
(the “Merger Closing
8-K”).
KeyStone
previously assumed the Notes from KeyStone Solutions, Inc., a
Delaware corporation (“KSI”), on August 28, 2017
(the “Closing
Date”), upon the closing of certain merger
transactions (the “Mergers”) under the
Second Amended Agreement and Plan of
Merger (the “Merger
Agreement”), dated as of
July 12, 2017, by and among the Company, KeyStone, KSI, Brekford
Traffic Safety, Inc., a Delaware corporation
(“Brekford”),
and Brekford Merger Sub, Inc., a Delaware corporation (the
“Merger
Agreement”). Prior
to the Mergers, KSI had issued the Notes in favor of the respective
holders, on the Original Issuance Date, in connection with its
acquisition of 100% of the membership interests in Firestorm
Solutions, LLC, a Delaware limited liability company, and Firestorm
Franchising, LLC, a Georgia limited liability company, as described
in that certain Current Report on Form 1-U filed by KSI with the
SEC on January 26, 2017 (the “Firestorm
1-U”).
The
foregoing descriptions of the Assignment Agreement and the
Replacement Notes do not purport to be complete and are qualified
in their entirety to the full text of the Assignment Agreement and
each of the Replacement Notes, which are attached as Exhibits 10.1,
10.2, 10.3, 10.4 and 10.5, respectively. The information contained
in the Merger Closing 8-K and the Firestorm 1-U is also
incorporated herein by reference and qualifies our response to this
Item 2.03.
Item 8.01 Other Events.
On
September 27, 2017, the Company extended the expiration date of
options (the “Options”) to purchase an
aggregate of 15,000 shares of the common stock, par value $0.0001
per share (“Common
Stock”), of the Company, held by each of Mr. Steve
Ellis and Mr. Robert West. Messrs. Ellis and West received their
respective Options as merger consideration in connection with the
Mergers, in exchange for now-cancelled options to purchase shares
of the common stock, par value $0.0001 per share, of Brekford
originally issued to each such holder under Brekford’s 2008
Stock Incentive Plan. The Options were due to expire on September
27, 2017, being 30 days from the date on which each such holder
ceased to be a director of Brekford. The Company voluntarily
extended that date, for no additional consideration, until December
31, 2017, as described in the option agreements (the
“Option
Agreements”) attached hereto as Exhibit 10.6, in
respect of Mr. Ellis, and as Exhibits 10.7 and 10.8, in respect of
Mr. West.
The
foregoing descriptions of the Options and the Option Agreements do
not purport to be complete and are qualified in their entirety by
the full text of the Option Agreements attached as Exhibit 10.6,
10.7 and 10.8 hereto. The information contained in the Merger
Closing 8-K is also incorporated herein by reference and qualifies
our response to this Item 8.01.
Item
9.01 Financial
Statements and Exhibits.
(d)
Exhibits
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Exhibit No.
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Description
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Assignment
and Assumption Agreement, dated September 29, 2017
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Replacement
Note issued in favor of Harry Rhulen on September 29,
2017
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Replacement
Note issued in favor of Suzanne Loughlin on September 29,
2017
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Replacement
Note issued in favor of James Satterfield on September 29,
2017
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Replacement
Note issued in favor of Lancer Financial Group, Inc. on September
29, 2017
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Non-Qualified
Stock Option Agreement by and between the Novume Solutions, Inc.,
and Steve Ellis, dated September 27, 2017
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Non-Qualified
Stock Option Agreement by and between the Novume Solutions, Inc.,
and Robert West, dated September 27, 2017 (2014
Options)
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Non-Qualified
Stock Option Agreement by and between the Novume Solutions, Inc.,
and Robert West, dated September 27, 2017 (2016
Options)
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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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Date:
October 3, 2017
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By:
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/s/
Robert A. Berman
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Robert
A. Berman,
Chief
Executive Officer
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