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EX-10.1 - CLR SILES MILL CONSTRUCTION AGREEMENT DATE JANUARY 15, 2019 - Youngevity International, Inc. | ex10-1.htm |
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 15,
2019
YOUNGEVITY INTERNATIONAL, INC.
(Exact
name of registrant as specified in its charter)
Delaware
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000-54900
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90-0890517
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(State
or other jurisdiction of incorporation)
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(Commission
File No.)
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(IRS
Employer Identification No.)
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2400 Boswell Road, Chula Vista, CA 91914
(Address
of principal executive offices) (Zip Code)
Registrant’s
telephone number, including area code: (619) 934-3980
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:
☐ 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
1.01.
Entry
into a Material Definitive Agreement.
On
January 15, 2019, Youngevity International, Inc. (the
“Company”) entered into the CLR Siles Mill Construction
Agreement (the “Mill Construction Agreement”) with
Hernandez Hernandez Export & Compania Limitada, an entity
created under the laws of Nicaragua (“H&H”),
H&H Coffee Group Export, Corp, a Florida corporation
(“H&H Export”), Alain Piedra Hernandez
(‘Hernandez”) and Marisol Del Carmen Siles Orozco
(“Siles”, and together with H&H, H&H Export,
Hernandez, the “Nicaraguan Partner”), pursuant to which
the Nicaraguan Partner agreed to transfer a 45 acre tract of land
in Matagalpa, Nicaragua (the “Property”) to a business
entity to be owned 50% by the Nicaraguan Partner and 50% by the
Company and the Company issued to H & H Export in consideration
thereof 153,846 shares of its common stock. In addition, the
Nicaraguan Partner and the Company each agreed to contribute
$4,700,000 toward construction of a processing plant, office, and
storage facilities (“Mill”) on the Property for
processing coffee in Nicaragua, with $650,000 being paid on January
15, 2019 and February 15, 2019, and $500,000 being paid on each of
March 15, 2019, April 15, 2019, May 15, 2019, June 15, 2019 and
July 15, 2019.
The
Company’s coffee segment, CLR Roasters, LLC
(“CLR”),
is associated with H&H and H&H
Export through sourcing arrangements to procure Nicaraguan green
coffee beans and in March 2014 as part of the Siles Plantation
Family Group acquisition, CLR engaged Hernandez and Siles, the
owners of H&H as employees to manage Siles. In
addition, CLR and H&H, Hernandez and Siles have agreed to
restructure their profit sharing agreement in regard to profits
from green coffee sales and processing that increases the
Company’s profit participation by an additional 25%. Under
the new terms of the agreement with respect to profit generated
from green coffee sales and processing from La Pita, a leased mill,
or the new mill, now will provide for a split of profits of 75% to
the Company and 25% to the Nicaraguan Partners, after certain
conditions are met. The Company has agreed to issue 295,910 shares
of its common stock to H&H Export to pay for certain working
capital, construction and other payables. In addition, H&H
Export has also agreed to sell to CLR its espresso brand Café
Cachita in consideration of the issuance of 100,000 shares of the
Company’s common stock. Hernandez and Siles are each
employees of CLR. The shares of common stock issued were valued at
$7.80 per share.
The
foregoing description of the terms of the Mill Construction
Agreement does not purport to be complete and is subject to and are
qualified in their entirety by reference to the provisions of such
agreement, the form of which is filed as Exhibit 10.1 to this
Current Report on Form 8-K and is incorporated herein by
reference.
Item
2.03.
Creation
of a Direct Financial obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The
disclosure set forth in Item 1.01 of this Current Report on Form
8-K is incorporated into this Item 2.03 by reference.
Item 3.02
Unregistered Sales of Equity
Securities.
The
information regarding the securities of the Company set forth under
Item 1.01 of this Current Report on Form 8-K is incorporated by
reference in this Item 3.02. The Company issued the shares of the
Company’s common stock in reliance on the exemption from
registration provided for under Section 4(a)(2) of the Securities
Act. The Company relied on this exemption from registration for
private placements based in part on the representations made H
&H Export with respect to its status as an accredited investor,
as such term is defined in Rule 501(a) of the Securities
Act.
Item
9.01.
Financial
Statements and Exhibits.
(d)
Exhibits
Exhibit No.
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Name of Exhibit
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CLR
Siles Mill Construction Agreement date January 15,
2019
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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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YOUNGEVITY
INTERNATIONAL, INC.
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Date:
January 18, 2019
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By:
/s/ David Briskie
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Name:
David Briskie
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Title:
President and Chief Financial Officer
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