SEC Filing Summary: Concierge Technologies, Inc. (Form 8-K)
Business Context and Reporting Period
Company: Concierge Technologies, Inc. (Note: Metadata listed "Marygold Companies, Inc." but the filing text identifies the registrant as Concierge Technologies, Inc.)
Date of Report: June 2, 2016
Event: Completion of the acquisition of 100% of the outstanding stock of Brigadier Security Systems (2000) Ltd. ("Brigadier").
Key Financial Metrics and Transaction Details
- Total Purchase Price: $1,733,000 Canadian Dollars (CDN).
- Payment Structure:
- $1,000,000 CDN paid on the Closing Date (June 2, 2016).
- $733,000 CDN (Remaining Balance) payable on the 183rd day if sales goals are met; otherwise, payable on the 365th day.
- Working Capital Adjustment: Initial estimate of $418,000 CDN adjusted to $977,333 CDN at closing. Final calculation due within 90 days; settlement within 120 days.
- Debt Financing: Two convertible promissory notes issued to fund the transaction:
- Wainwright Note: $250,000 principal, 4% interest (8% on default), convertible at $0.13/share after 180 days.
- Schoenberger Note: $250,000 principal, 4% interest (8% on default), convertible at $0.13/share after 180 days.
- Revenue/Profit/Cash Flow: The filing text does not provide specific revenue, profit, or cash flow figures for the reporting period. Audited financial statements for the acquired entity are to be filed within 71 days.
Material Changes and Governance
- Acquisition: Concierge Technologies acquired all Class B, Class F, and Class H shares of Brigadier.
- Management Changes:
- Robert Freberg and Patrick Thompson (former Brigadier officers/directors) resigned.
- Nicholas Gerber (CEO) and David Neibert (CFO) of Concierge Technologies were appointed to Brigadier's board.
- Restrictive Covenants: Sellers executed a 5-year non-competition and non-interference agreement.
Outlook, Risks, and Contingencies
- Contingent Liability: The timing of the $733,000 CDN remaining balance payment is contingent on Brigadier achieving specific sales goals.
- Working Capital Risk: Final purchase price adjustment depends on the net working capital calculation completed within 90 days of closing.
- Related Party Transactions: Financing notes were issued to entities affiliated with the CEO (Wainwright Holdings) and a Director (Schoenberger Family Trust).
- Future Filings: Pro forma financial information and audited statements for Brigadier are pending and will be filed within 71 days.
Investor Verification Checklist
- Verify the final Net Working Capital calculation and any resulting price adjustment due within 120 days of June 2, 2016.
- Confirm whether Brigadier achieved the sales goals required to trigger the 183-day payment of the remaining balance.
- Review the upcoming audited financial statements of Brigadier (due within 71 days) to assess the acquired entity's financial health.
- Monitor the conversion of the $500,000 in related-party convertible notes into common stock at the $0.13/share price.