OLB GROUP, INC. - Form 8-K Summary
Business Context and Reporting Period
This Current Report on Form 8-K was filed by The OLB Group, Inc. on June 17, 2010. The report details a material definitive agreement and unregistered sales of equity securities involving the acquisition of assets from Retailer Networks Inc. ("RNI").
Key Financial Metrics and Transaction Details
The filing does not provide standard financial metrics such as revenue, profit, cash flow, margins, debt, or liquidity for the reporting period. The primary financial activity reported is the asset acquisition transaction:
- Consideration Issued: 11,556,835 shares of OLB Group common stock issued to RNI.
- Warrants Issued: A warrant to acquire 13,316,835 shares at an exercise price of $0.40 per share, exercisable for two years.
- Escrow Arrangement: 1,155,684 shares (10% of issued shares) were placed in escrow for six months as indemnification security.
- Cash Proceeds: RNI purchased 3,571,429 shares of OLB Group common stock for $100,000.
Material Changes
The Company closed the acquisition of RNI's business-to-business system assets on June 17, 2010. The assets acquired include processes, software, systems, intellectual property, trade names, websites, contracts, customer lists, and goodwill. This transaction resulted in significant dilution through the issuance of over 11.5 million shares and warrants for over 13.3 million shares.
Outlook, Risks, and Contingencies
The filing does not contain forward-looking guidance, management commentary on future performance, or a discussion of general business risks. The primary contingency noted is the escrow agreement, which allows the Company to cancel the escrowed shares if RNI is required to indemnify the Company for any loss. The securities were issued in a private placement relying on exemptions under Section 4(2) of the Securities Act of 1933 and Rule 506.
Key Facts for Investor Verification
- Verify the fair market value of the assets acquired from RNI relative to the 11,556,835 shares and warrants issued.
- Confirm the impact of the 11,556,835 new shares and 13,316,835 warrant shares on existing shareholder dilution.
- Review the specific terms of the Asset Purchase Agreement (Exhibit 99.1) regarding the scope of assets and any assumed liabilities.
- Monitor the status of the 1,155,684 escrowed shares over the six-month period.