SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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 9, 2001
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ATLANTIC TECHNOLOGY VENTURES, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-27282 36-3898269
(State or other jurisdiction of (Commission file number) (I.R.S. employer
incorporation or organization) identification no.)
150 Broadway
Suite 1009 10038
New York, New York (Zip code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (212) 267-2503
Item 5. Other Events.
As described below, Atlantic Technology Ventures, Inc. ("Atlantic") and
BH Capital Investments, L.P. and Excalibur Limited Partnership (collectively,
the "Investors") have renegotiated the terms of the investment by the Investors
in shares of Atlantic's Series B convertible preferred stock. Atlantic believes
that the revised terms address concerns raised by Atlantic stockholders and the
Nasdaq Stock Market.
On September 28, 2000, the Investors purchased from Atlantic, for a
purchase price of $2 million, 689,656 shares of Atlantic's Series B convertible
preferred stock and warrants to purchase 134,000 shares of Atlantic's common
stock. (For a description of this transaction and a copy of the related
documents, including the convertible preferred stock and warrants purchase
agreement (the "Purchase Agreement"), see Atlantic's Quarterly Report on Form
10-QSB for the quarter ended September 30, 2000.)
On December 4, 2000, Atlantic and the Investors entered into a stock
repurchase agreement (the "Stock Repurchase Agreement") providing for Atlantic's
repurchase of 482,760 shares of Series B preferred stock. (The Stock Repurchase
Agreement is described in a Current Report on Form 8-K filed with the SEC on
December 11, 2000, and a copy of the Stock Repurchase Agreement is attached as
Exhibit 10.1 to that Current Report on Form 8-K.)
In the Repurchase Agreement, the Investors granted to Atlantic an
option to repurchase on terms specified in the Stock Repurchase Agreement the
remaining 206,898 shares of Series B preferred stock held by the Investors. (On
December 28, 2000, Atlantic and the Investors amended the Stock Purchase
Agreement by extending from January 2, 2001, to January 9, 2001, the expiration
date of this option, as reported on Form 8-K filed with the SEC on December 29,
2000.) Atlantic elected to not exercise this option; instead, by means of
amendments dated January 9, 2001, and January 19, 2001, to the Purchase
Agreement, Atlantic and the Investors renegotiated the terms of the Investors'
remaining investment in Atlantic.
The principal renegotiated terms are as follows:
o the Series B certificate of designations was amended as follows:
(1) the "Floor Price" was lowered from $1.00 to $0.50, but the
definition was also revised to remove all of the various grounds
for calculating the Conversion Price without considering the Floor
Price;
(2) the definition of "Conversion Price" was revised to lower the
fixed-price element from $3.00 to $1.00;
(3) Atlantic is required to redeem on March 28, 2002, all outstanding
shares of Series B preferred stock for (A) 125% of the original
issue price per share or (B) the market price of the shares of
common stock into which they are convertible, whichever is greater
(the "Redemption Price");
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(4) Atlantic may at any time redeem all outstanding shares of Series B
preferred stock for the Redemption Price; and
(5) even if Atlantic is delisted from the Nasdaq Stock Market, any cap
on the number of shares that could without stockholder approval be
issued upon conversion of shares of Series B preferred stock will
remain in place.
o Atlantic is no longer required to seek stockholder approval of (1)
issuance to the Investors of Conversion Shares and Warrant Shares
(as defined in the Purchase Agreement) in excess of the 20% cap
imposed by the Nasdaq Marketplace Rules and (2) amendment of the
certificate of designations of Atlantic's Series A convertible
preferred stock to subordinate the rights of the Series A
convertible preferred stock to those of the Series B preferred
stock, and so Atlantic is no longer subject to penalties for failure
to secure stockholder approval;
o the definition of "Repurchase Event" in the Purchase Agreement was
amended by adding six additional events:
(1) Atlantic fails to sign a binding definitive agreement with Bausch
& Lomb on or before January 31, 2001, providing for Atlantic's
receipt of $3,000,000 of cash proceeds from Bausch & Lomb on or
before March 7, 2001;
(2) Atlantic fails to receive $3,000,000 of cash proceeds from Bausch
& Lomb on or before March 7, 2001;
(3) the average closing bid price of Atlantic's common stock for the
ten trading days preceding January 31, 2001, does not exceed $1.00
per share;
(4) the average closing bid price of Atlantic's common stock for the
ten trading days preceding March 7, 2001 does not exceed $1.00 per
share;
(5) Atlantic's common stock ceases to be listed on either the Nasdaq
National Market or the Nasdaq SmallCap Market; and
(6) receipt by Atlantic, after expiration of the applicable "watch
period," of a Staff Determination (as defined in Rule 4815 of the
Nasdaq Marketplace Rules) to limit or prohibit the continued
listing of Atlantic's securities on the Nasdaq SmallCap Market, it
being understood that (A) this Repurchase Event will not be
affected by any right Atlantic may have to request a hearing or
pursue other remedies against Nasdaq, and (B) excluded from the
scope of this Repurchase Agreement is any Staff Determination
received by Atlantic that was directly prompted by the express
terms of any of the Purchase Agreement or any document
contemplated therein;
o the fixed exercise price of the warrants issued to the Investors to
purchase 134,000 shares of Atlantic common stock was lowered from
$3.19 to $1.00, the market price of Atlantic's common stock at the
time of the renegotiation (the
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warrants are exerciseable at the fixed exercise price or 110% of the
market price 180 days after the date of issuance, whichever is
lower);
o Atlantic issued to the Investors warrants to purchase a further
20,000 shares of Atlantic common stock at the same exercise price;
On January 19, 2001, each Investor issued to Atlantic a notice electing
to convert 20,690 shares of Series B preferred stock into 118,211 shares of
common stock, meaning that the Investors elected to convert an aggregate of
41,380 shares of Series B preferred stock into 236,422 shares of common stock.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
3.1 Amended certificate of designations, references and rights of Series B
convertible preferred stock of Atlantic filed on January 9, 2001.
3.2 Amended certificate of designations, preferences and rights of Series B
convertible preferred stock of Atlantic filed on January 19, 2001.
10.1 Amendment No. 2 dated January 9, 2001, to convertible preferred stock
and warrants purchase agreement dated September 28, 2000, between
Atlantic, BH Capital Investments, L.P. and Excalibur Limited
Partnership.
10.2 Amendment No. 3 dated January 19, 2001, to convertible preferred stock
and warrants purchase agreement dated September 28, 2000, between
Atlantic, BH Capital Investments, L.P. and Excalibur Limited
Partnership.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
Atlantic Technology Ventures, Inc. has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
Date: January 23, 2001 ATLANTIC TECHNOLOGY VENTURES, INC
By: /s/ Frederic P. Zotos
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Frederic P. Zotos
President
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