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)
April 11, 2007
ACORN
FACTOR, INC.
(Exact
name of Registrants as Specified in their Charters)
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Delaware
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0-19771
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22-2786081
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(States
or Other
Jurisdiction
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(Commission
file Numbers)
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(IRS
Employer
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of
Incorporation)
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Identification
Nos.)
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200
Route 17, Mahwah, New Jersey
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07430
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(Address
of Principal Executive
Offices)
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(Zip
Code)
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Registrants'
telephone number, including area code (201)
529-2026
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:
[
]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[
]
Soliciting material pursuant to Rule 14a-2 under the Exchange Act (17 CFR
240.14a-2)
[
]
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))
Item
1.01 Entry Into a Material Definitive Agreement
Item
3.02 Unregistered Sales of Equity Securities
On
April
11, 2007, Acorn Factor, Inc. (the “Company”) completed
the second and final closing of its previously announced private placement
of
10%
Convertible Redeemable Subordinated Debentures due March 2011.
At
the
final closing the Company issued $2,605,000 principal amount of the
Debentures, at par, and received gross proceeds in the same amount.
This
brings the aggregate principal amount of Debentures issued in the offering,
and
gross proceeds raised, to approximately $6.9 million.
From
the
date of issuance of the Debentures through the first anniversary of the initial
closing, 50% of the outstanding principal amount of the Debentures is
convertible into shares of the Company’s Common Stock at a price of $3.80 per
share. Following the first anniversary of the initial closing, the Debentures
will be convertible up to the entire principal amount then
outstanding.
In
addition to the Debentures, at the final closing subscribers received a warrant
exercisable for the purchase of a number of shares equal to 25% of the principal
amount of the Debentures purchased divided by the conversion price of $3.80,
resulting in the issuance at the final closing of Warrants to purchase 171,391
shares. The Warrants are exercisable for shares of the Company’s Common Stock
for five years at an exercise price of $4.50 per share and are callable by
the
Company in certain circumstances. Warrants to issue an aggregate of 453,047
shares of Common Stock were issued to subscribers in the offering.
Provided
that a registration statement covering the resale by the subscribers of the
shares underlying the Debentures and Warrants is effective, the Company may
redeem the outstanding principal amount of the Debentures, at par, in whole
or
in part, with accrued interest through the date of redemption.
The
Debentures bear interest at the rate of 10% per annum, payable quarterly. If
the
Company fails to redeem at least 50% of the total outstanding principal amount
of the Debentures, plus accrued interest, by the first anniversary of the
initial closing, the annual rate of interest payable on the Debentures will
be
increased to 12%.
First
Montauk Securities Corp. served as placement agent for the offering. Out of
the
gross proceeds received at the final closing, the Company paid the placement
agent commissions and expenses of approximately $325,100. In addition, in
connection with the final closing, the Company issued to the placement agent
warrants to purchase an additional 68,553 shares of Common Stock on the same
terms as those issued to the subscribers. The total of placement agent
commissions and expenses paid in connection with the offering was $863,795
and
the total number of warrants issued to the placement agent was
181,211.
The
issuance and sale of the Common Stock and Warrants was made to accredited
investors in reliance upon the exemption provided in Section 4(2) of the
Securities Act of 1933, as amended (the “Securities Act”). As such, the
securities sold in the offering and/or issuable upon the conversion or exercise
thereof have not been registered under the Securities Act and may not be offered
or sold in the United States absent registration or an applicable exemption
from
the registration requirements. No form of general solicitation or general
advertising was conducted in connection with offering. Each of the the
securities sold in the offering and/or issuable upon the conversion or exercise
thereof will contain restrictive legends preventing the sale, transfer or other
disposition of such securities, unless registered under the Securities Act.
In
connection with the initial closing, the Company issued the press release
annexed as Exhibit 99.1 hereto.
Item
9.01 Financial Statements and Exhibits.
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99.1
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Press
Release dated April 12, 2007.
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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 on this 12th day of April 2007.
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ACORN
FACTOR,
INC. |
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By: |
/s/
Sheldon
Krause |
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Name: |
Sheldon Krause |
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Title: |
Secretary and General
Counsel |