UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): April 24, 2007
RECLAMATION CONSULTING AND APPLICATIONS, INC.
(Exact name of registrant as specified in its charter)
Colorado
(State or other jurisdiction of incorporation)
000-26017 58-2222646
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(Commission File Number) (IRS Employer Identification No.)
940 Calle Amanecer, Suite E
San Clemente, California 92673
Telephone: (949) 542-7440
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(Address and telephone number of principal executive offices and
place of business)
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))
Reclamation Consulting and Applications, Inc. ("we", "us" or the "Company")
files this report on Form 8-K to report the following:
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
We entered into Amendment No. 2 ("Amendment No. 2") to the Securities Repurchase
Agreement (the "Agreement") entered into on February 1, 2007 to repurchase
secured convertible notes with an aggregate principal amount of $2,000,000 (the
"Convertible Notes") and warrants to purchase 8,000,000 shares of the Company's
common stock (the "Warrants") from four investors, AJW Offshore, Ltd., AJW
Qualified Partners, LLC, AJW Partners, LLC and New Millennium Capital Partners
II, LLC (collectively, the "Investors"). Although Amendment 2 is dated April 20,
2007, the Investors did not deliver an executed copy of Amendment 2 to us until
April 24, 2007.
Amendment No. 2 extended our deadline for repurchasing the Convertible Notes
from April 30, 2007 to May 31, 2007. Amendment No. 1 to the Agreement previously
extended our deadline for repurchasing the Convertible Notes from March 30, 2007
to April 30, 2007.
Under the terms of the amended Agreement, we have until May 31, 2007 to
repurchase both the Convertible Notes and the Warrants. For the Convertible
Notes we must pay the Investors an aggregate purchase price consisting of (i)
cash equal to the outstanding balance of accrued principal and interest due
under the Convertible Notes plus a 30% prepayment penalty, and (ii) 3,250,000
restricted shares of our common stock. Should we repurchase the Convertible
Notes on the last possible day under the Agreement, May 31, 2007, the aggregate
cash portion of the purchase price will be $902,759. Additionally, if we have
not repurchased the Convertible Notes by April 30, 2007, on that date we will be
required to make routine monthly payments pursuant to the Convertible Notes in
the aggregate amount of $62,553.13. The aggregate cash price that we must pay
the Investors for the Warrants is $258,338.
Valued at $0.10 per share, the closing sale price of our shares on the OTC
Bulletin Board on February 1, 2007, the 3,250,000 shares to be issued to the
Investors under the Agreement had a value of $325,000. The shares will bear a
legend stating that the shares are "restricted securities" pursuant to Rule 144;
and are entitled to "piggyback registration rights" requiring us to register the
shares for sale on the next qualifying registration statement that we may file
with the Securities and Exchange Commission. All four Investors represented that
they are accredited investors, and we believe the issuance of the shares to the
Investors is exempt from registration pursuant to Regulation D and Section 4(2)
of the Securities Act of 1933, as amended.
Under the terms of the amended Agreement, as long as we make all payments
required by the Agreement and do not otherwise breach the Agreement, the
Investors shall have no further rights under the agreements and other documents
we entered into with the Investors on June 23, 2005 (the "Initial Purchase
Documents"), pursuant to which the Investors purchased the Convertible Notes and
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Warrants. If we should fail to repurchase both the Convertible Notes and the
Warrants by May 31 2007, the Agreement shall become null and void and the
Initial Purchase Documents shall remain in effect. If we repurchase the
Convertible Notes but do not repurchase the Warrants, the provisions of the
Agreement relating to the repurchase of the Warrants shall be null and void and
the Initial Purchase Documents will continue in full force and effect.
We currently do not have the funds necessary to repurchase the Notes and
Warrants and plan to raise these funds though the private placement of debt or
equity. However, we can offer no assurance that we will be able to raise all or
any portion of the funds necessary to repurchase the Notes and Warrants on terms
favorable to the Company or at all.
In the event we successfully complete the repurchase of the Convertible Notes
and Warrants, we plan to cancel them on receipt.
Copies of the original Agreement, Amendment No. 1 and Amendment No. 2 are
attached as Exhibits 10.34, 10.35 and 10.36 to this Current Report on Form 8-K.
ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN
OFF- BALANCE SHEET ARRANGEMENT.
Our discussion under Item 1.01 of this Current Report is hereby incorporated by
this reference.
ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES
Our discussion under Item 1.01 of this Current Report is hereby incorporated by
this reference.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
Exhibit No. Description
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10.34* Securities Purchase Agreement, dated as of February 1, 2007,
by and between Reclamation Consulting and Applications, Inc.
and AJW Partners, LLC, AJW Qualified Partners, LLC, AJW
Offshore, Ltd. and New Millennium Partners II, LLC.
10.35** Amendment No. 1. to Securities Purchase Agreement, dated as of
February 26, 2007, by and between Reclamation Consulting and
Applications, Inc. and AJW Partners, LLC, AJW Qualified
Partners, LLC, AJW Offshore, Ltd. and New Millennium Partners
II, LLC.
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10.36* Amendment No. 2. to Securities Purchase Agreement, dated as of
April 20, 2007, by and between Reclamation Consulting and
Applications, Inc. and AJW Partners, LLC, AJW Qualified
Partners, LLC, AJW Offshore, Ltd. and New Millennium Partners
II, LLC.
* Filed on February 2, 2007 as Exhibit 10.34 to our Report on Form 8-K dated
February 2, 2007 and incorporated herein by reference.
** Filed on March 19, 2007 as Exhibit 10.35 to our Report on Form 8-K dated
March 16, 2007 and incorporated herein by reference.
SIGNATURES:
Pursuant to the requirement 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.
Reclamation Consulting and Applications, Inc.
By: /s/ MICHAEL C. DAVIES
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Michael C. Davies, Chief Executive Officer
Dated: April 24, 2007
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