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) August 22, 2005
(August 17, 2005)
UNION DENTAL HOLDINGS, INC.
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(Exact name of registrant as specified in its charter)
Florida 000-26703 65-0710392
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
1700 University Drive, Suite 200
Coral Springs, Florida 33071
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (954) 575-2252
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(Former name or former address, if changed since last report.)
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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))
SECTION 1. REGISTRANT'S BUSINESS AND OPERATION
ITEM 1.01. Entry into a Material Definitive Agreement
On August 17, 2005, we sold $600,000 in principal amount of our five year
convertible debentures to Dutchess Private Equities Fund, II, L.P. (the
"Investor"). These debentures bear interest at 10% per annum (payable in cash or
stock at the Investor's option). The first $300,000 (less expenses) has been
funded with an additional $300,000 to be funded immediately upon filing of a
registration statement with the Securities and Exchange Commission ("SEC"). Our
obligation to repay the investor is secured by a security agreement which we
have granted the Investor. We have pledged all of our assets to insure repayment
of this obligation. The Investor's security interest in our assets will be
subject to any claims by our bank which provides us with a line of credit.
Subject to adjustment as more fully set forth in the Debenture Agreement,
the fixed conversion price of the debenture shall be $.092 per share or; the
lowest closing bid price of the common stock during the fifteen days trading
days prior to the filing with the SEC of a registration statement covering the
shares issuable on the underlying debt.
We also issued to the Investor a warrant to purchase 1,304,348 shares of
common stock with a strike price of $.092 per share. The warrant may be
exercised for a period of five years and the strike price is subject to
adjustment if certain conditions are not met.
If we do not file a Registration Statement with the SEC within 30 days, and
if the Registration Statement is not declared effective within 90 days of
closing, we will incur significant liquidated damages and interest expense.
Also on August 17, 2005, we entered into an Investment Agreement with the
Investor. Pursuant to this Agreement, the Investor shall commit to purchase up
to $5,000,000 of the Company's Common Stock over the course of 36 months ("Line
Period"), after a registration statement has been declared effective by the SEC
("Effective Date"). The amount that the Company shall be entitled to request
from each of the purchase "Puts", shall be equal to either 1) $100,000 or 2)
200% of the averaged daily volume (U.S market only) ("ADV") multiplied by the
average of the 3 daily closing prices immediately preceding the Put Date. The
ADV shall be computed using the three (3) trading days prior to the Put Date.
The Pricing Period shall be the five (5) consecutive trading days immediately
after the Put Date. The Market Price shall be the lowest closing bid price of
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the Common Stock during the Pricing Period. The Purchase Price shall be set at
95% of the Market Price. The Put Date shall be the date that the Investor
receives Put Notice of draw down by Company of a portion of the Line. There are
put restrictions applied on days between the Put Date and the Closing Date with
respect to that Put. During this time, the Company shall not be entitled to
deliver another Put Notice. The Company shall automatically withdraw that
portion of the put notice amount, if the Market Price with respect to that Put
does not meet the Minimum Acceptable Price. The Minimum Acceptable Price is
defined as 75% of the closing bid price of the common stock for the ten (10)
trading days prior to the Put Date.
Investors are urged to read the underlying agreements in their entirety
which are attached as exhibits to this Form 8-k for a full understanding of the
terms and conditions of these financings.
SECTION 9. FINANCIAL STATEMENTS AND EXHIBITS
Item 9.01 Financial Statements and Exhibits
(c) Exhibits.
Exhibit Number Description
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10.1 * Debenture Agreement
10.2 * Debenture Registration Rights Agreement
10.3 * Warrant Agreement
10.4 * Equity Line of Credit Registration Rights Agreement
10.5 * Investment Agreement
10.6 * Security Agreement
10.7 * Subscription Agreement
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* Filed herewith
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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.
UNION DENTAL HOLDINGS, INC.
August 19, 2005
By: /s/ George D. Green
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Name: George D. Green
Title: CEO and Director
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