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): June 27, 2005
FIRST MONTAUK FINANCIAL CORP.
-----------------------------
(Exact name of registrant as specified in its charter)
COMMISSION FILE NUMBER: 0-6729
------
NEW JERSEY 22-1737915
---------- ----------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Parkway 109 Office Center
328 Newman Springs Road
Red Bank, NJ 07701
(Address and zip code of principal executive offices)
(732) 842-4700
(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:
|_| 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 Material Definitive Agreements
First Montauk Financial Corporation, a New Jersey corporation ("First
Montauk" or "Registrant") has executed a definitive Amended and Restated
Agreement and Plan of Merger dated June 27, 2005 ("Restated Agreement") with
Olympic Cascade Financial Corporation ("Olympic"). The Restated Agreement
supersedes in full the previous merger agreement between the parties dated as of
February 28, 2005.
A copy of the joint press release issue by First Montauk and Olympic dated
June 28, 2005 is included as an exhibit to this Form 8-K.
Pursuant to the Restated Agreement, First Montauk will issue 1.75 shares of
its common stock for all outstanding shares of common stock of Olympic.
Outstanding Series A Preferred Stock, options and warrants of Olympic will also
reflect the new exchange ratio. Under the terms of the Restated Agreement,
Olympic will become a wholly-owned subsidiary of First Montauk. First Montauk
will continue to operate First Montauk Securities Corp and Olympic's broker
dealer firm, National Securities Corporation, as separate subsidiaries for an
undetermined period of time.
Additionally, the Board of Directors of First Montauk following the closing
will consist of Messrs. Mark Goldwasser, Victor Kurylak, two other designees of
each of Olympic and FMFK and one other mutually agreed upon designee, who shall
serve as chairman (and who shall not be any one of the four named foregoing
persons).
A condition to the transaction in completion of financing in an amount of
$4,000,000 in gross proceeds. First Montauk and Olympic have previously executed
letters of intent with St. Cloud Capital LLC, a Los Angeles based investment
firm, to provide approximately $4.0 million of capital to Olympic Cascade and
First Montauk. The parties are continuing to discuss the definitive terms of the
financing. The investment by St. Cloud Capital is subject to due diligence
investigation, execution of definitive agreements and customary closing
conditions.
The terms include provisions that Mr. Goldwasser and Mr. Kurylak will
comprise the Office of the Chief Executive Officer of First Montauk effective at
closing. Mr. Kurylak will serve as the Chief Executive Officer and Mr.
Goldwasser will serve as President and Chief Operating Officer. Both will report
directly to the Board of Directors of First Montauk. As a condition to closing,
Olympic and Messrs Goldwasser and Kurylak will negotiate the definitive terms of
their new respective employment agreements.
Under the terms of the Restated Agreement, the shareholders of Olympic will
receive 1.75 shares of First Montauk Common Stock for each share of Olympic.
Currently, First Montauk has approximately 15,744,000 shares of Common Stock
outstanding. Olympic has approximately 5,045,000 shares of common stock
outstanding. Assuming the transaction is completed, First Montauk will have
approximately 20,800,000 shares of common stock, without giving effect to
conversion of any then outstanding preferred shares or other outstanding
securities such as options, warrants and debentures.
In addition, under the terms of the Restated Agreement, Mr. Herbert
Kurinsky, the current Chairman of First Montauk, Mr. William Kurinsky, the
former Chief Executive Officer of First Montauk, Mr. Victor K. Kurylak, the
Chief Executive Officer of First Montauk and Mark Goldwasser, the Chief
Executive of Olympic (and One Clark LLC, an affiliate of Mr. Goldwasser),
delivered voting agreements whereby they have agreed to vote their respective
shares in favor of the transaction.
Completion of the transaction is subject to several conditions including
usual and customary conditions for transactions of this nature, including
shareholder approval, completion of the anticipated financing in an amount of at
least $4,000,000 in gross proceeds and completion of regulatory review of the
proposed transaction by the NASD. The parties expect to file a joint proxy
registration statement with the SEC in the third quarter and the parties expect
to close the transaction by the end of the fourth calendar quarter of 2005. As a
result of the foregoing conditions, there can be no assurances that the
transaction will be completed or if completed, by such date. Regulatory review
by the SEC and/or NASD could delay the anticipated closing date. If the
transaction is not consummated by October 31, 2005, the parties have the option
not to proceed.
2
The foregoing description of the merger and the Restated Agreement is
qualified in its entirety by reference to the Restated Agreement.
This material is not a substitute for the proxy statement/prospectus that
the Company will file with the Securities and Exchange Commission. Investors are
urged to read the document when it is available because it will contain
important information, including detailed risk factors. The proxy
statement/prospectus with other important documents to be filed by the Company
will be available free of charge at the SEC's website, www.sec.gov or from the
Company. The Company's directors and certain other executive officers may be
considered participants in the solicitation of proxies in connection with the
proposed transaction. Information concerning the Company's directors and
executive officers can be found in the documents filed by the Company with the
SEC. Certain directors and executive officers of the Company may have direct or
indirect interest in the proposed transaction. Additional information about the
participants will be contained in the proxy statement/prospectus.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits.
The following exhibits are filed herewith:
Exhibit No. Description of Document
10.1 Amended and Restated Agreement and Plan of Merger
dated as of June 27, 2005 by and among First Montauk
Financial Corp., Olympic Cascade Financial Corp.
and OLY Acquisition Corp. (filed without exhibits).
99.1 Press Release dated June 28, 2005.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report on Form 8-K to be signed on its
behalf by the undersigned hereunto duly authorized.
Dated: June 28, 2005 First Montauk Financial Corp.
(Registrant)
By /s/ Victor K. Kurylak
--------------------------------------
Victor K. Kurylak, Chief Executive Officer
and President
3