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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report Pursuant to Section 13 or 15(d) of
the Securities Act of 1934
Date of report (Date of earliest event reported): January 16, 1998
USA TECHNOLOGIES, INC.
(Exact Name of Registrant as Specified in its Charter)
Pennsylvania 33-70992 23-269963
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of Identification No.)
incorporation)
200 Plant Avenue
Wayne, Pennsylvania 19087
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (610) 989-0340
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Item 5. Other Events.
On January 19, 1998, the Company, Mail Boxes Etc. ("MBE"), and
IBM Global Services ("IBM") signed a non-binding letter of intent. The letter of
intent confirms that they are currently negotiating an agreement pursuant to
which IBM would perform and/or assist with certain aspects of the business of
the joint venture formed by the Company and MBE in September 1997. The joint
venture was formed to sell and market credit card activated, unattended business
centers under the name MBE Business ExpressTM to the hospitality industry as
well as other industries.
Pursuant to the proposed agreement, IBM would serve as the
single point of contact for certain aspects of the joint venture's business.
These are anticipated to include project management services, asset procurement
and inventory financing, configuration, testing, site preparation, installation,
maintenance services, and asset management. IBM would also assist the joint
venture with marketing and technology exchange. There can be no assurance,
however, that any agreement will be entered into by the parties, or if
entered into, cover the foregoing items.
On January 16, 1998, the Board of Directors approved a private
placement offering to be conducted on a "best efforts" basis pursuant to
Regulation D promulgated under the Securities Act of 1933, as amended, for up to
$700,000 of the Company's securities. The offering consists of 70 units at
$10,000 each, with each unit consisting of 2,000 shares of Series A Convertible
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Preferred Stock and 50,000 1998-A Warrants. The 1998-A Warrants are exercisable
at any time during a five year period and enable the holder to purchase one
share of Common Stock for $.15 on or before June 1, 1998 and for $.40
thereafter. The Company anticipates that the offering would commence on the date
hereof and terminate on or before February 28, 1998.
In May 1997, the Company had entered into an agreement with a
newly formed Canadian company pursuant to which it agreed to purchase 10
Business ExpressTM business centers from the Company. The total purchase price
for the 10 units if all units had been purchased would have been $1,118,261
(Canadian dollars). As of the date hereof, only one complete Business ExpressTM
unit and another unit consisting of equipment only (with no control systems)
have been purchased under the agreement by the purchaser.
The Company does not anticipate that any of the remaining
units will be ordered by the purchaser under the agreement. The Company believes
that the purchaser has breached its obligations under the agreement and is
currently exploring the viability of pursuing appropriate legal action against
the purchaser, 1217909 Ontario, Inc., as well as its affiliates. There can be no
assurance that the Company will be successful in any of its potential legal
claims, or if successful, be able to actually collect any damages from the
purchaser or any of its affiliates.
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Item 7. Exhibits.
(c) The following Exhibit is filed as part of this Form 8-K:
Exhibit No. Description
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10.1 Business Express Agreement between
the Company and 1217909 Ontario Inc.
dated May 20, 1997 (Incorporated by
reference to Exhibit 10.2 to Form 8-K
filed on May 22, 1997)
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
USA TECHNOLOGIES, INC.
By: /s/ George R. Jensen, Jr.
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George R. Jensen, Jr.,
President and Chief
January 29, 1998 Executive Officer
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