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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): September 15, 2000
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 September 15, 2000, the Company and Swartz Private Equity, LLC
("Swartz"), a private equity fund, entered into an Investment Agreement pursuant
to which Swartz agreed to purchase up to $20,000,000 of Common Stock from the
Company. The purchases would be made at the option of the Company over a period
not to exceed three years in amounts based upon certain market conditions. The
purchase price would be based upon the current market price of the Common Stock
during the applicable pricing period for each purchase.
The Company also issued to Swartz a Commitment Warrant to purchase up
to 1,200,000 shares of Common Stock at any time during a ten year period. The
exercise price would be the lower of $1.00 or the lowest closing price of the
Common Stock during the last five trading days prior to each and every six month
anniversary occurring after the date of issuance and prior to the date of
exercise. The amount of shares issuable under the Commitment Warrant is subject
to increase pursuant to the Warrant Anti-Dilution Agreement entered into
between the Company and Swartz. The Investment Agreement also provides that
Swartz will receive additional warrants to purchase shares of Common Stock in an
amount equal to ten percent of the number of shares actually purchased by
Swartz under the Investment Agreement.
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Pursuant to a Registration Rights Agreement, the Company, at its sole
cost and expense, agreed to register for resale by Swartz all of the shares of
Common Stock issued to Swartz pursuant to the Investment Agreement, all of the
shares of Common Stock issued or issuable pursuant to the Commitment Warrant,
and all of the shares of Common Stock issued or issuable pursuant to the
warrants issued in connection with the purchase of shares of Common Stock under
the Investment Agreement. The purchase of shares of Common Stock by Swartz under
the Investment Agreement is subject to an effective registration statement and
certain other conditions set forth therein.
The Swartz offering was conducted by the Company pursuant to the
exemption from registration set forth in Section 4(2) of the Securities Act of
1933, as amended ("Act"), and Rule 506 promulgated thereunder.
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Any statements set forth above concerning the Investment Agreement,
Commitment Warrant, Warrant Anti-Dilution Agreement, or Registration Rights
Agreement, are not necessarily complete, and in each such instance, reference is
made to the particular document, a copy of which is filed herewith as an
Exhibit. Each such statement is qualified in its entirety by such reference.
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On September 15, 2000, the Company accepted Subscription Agreements
from nine investors to purchase an aggregate of 1,150,000 shares of restricted
Common Stock at $1.00 per share. For each share purchased, the investor also
received a warrant to purchase one share of Common Stock at $1.00 at any time
through January 31, 2001. The offering was conducted by the Company pursuant to
the exemption from registration set forth in Rule 506 promulgated under the Act,
and was sold only to accredited investors as defined in Rule 501 promulgated
thereunder. The Company has agreed to use its best efforts to register for
resale under the Act all of the Common Stock sold in the offering as well as all
of the Common Stock underlying the warrants. As of the date hereof, an aggregate
of $200,000 of the purchase price has been delivered to the Company by the
subscribers.
As previously reported, in June 2000, the Company had received and
accepted subscription agreements from five investors to purchase an aggregate of
2,200,000 shares of restricted Common Stock at $1.50 per share. During July
2000, the purchase price per share of the Common Stock was reduced from $1.50
per share to $1.00 per share, for a new aggregate purchase price of $2,200,000.
Pursuant to the agreements, full payment for the shares by the investors was to
be made to the Company on or before August 31, 2000. Through September 15, 2000,
the Company had not received from the investors any of the purchase price for
the shares of Common Stock. As a result, on September 15, 2000, and after prior
notice to the investors by the Company, the Company formally notified the
investors that it had rescinded and canceled each of the Subscription Agreements
effective immediately.
The United States government has granted the Company a patent entitled
Credit Card, Smart Card and Bank Issued Debit Card Operated System and Method
for Processing Electronic Transactions. The Company has also received a notice
of allowance of its patent entitled Credit and Bank Issued Debit Card Operated
System and Method for Controlling a Vending Machine.
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Item 7. Exhibits.
(c) The following Exhibits are filed as part of this Form 8-K:
Exhibit No. Description
10.1 Investment Agreement between the Company and Swartz Private
Equity, LLC dated September 15, 2000
10.2 Commitment Warrant issued to Swartz Private Equity LLC dated
August 29, 2000
10.3 Warrant Anti-Dilution Agreement between the Company and Swartz
Private Equity, LLC dated September 15, 2000
10.4 Registration Rights Agreement between the Company and Swartz
Private Equity dated September 15, 2000
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.,
Chief Executive Officer
September 21, 2000
