UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of the Securities and Exchange Act of 1934
Date
of
Report (Date of earliest event reported): September 25, 2008
VORTEX
RESOURCES CORP.
(Exact
name of registrant as specified in charter)
|
Delaware
|
001-12000
|
13-3696015
|
|
(State
or other jurisdiction
|
(Commission
|
(IRS
Employer
|
|
of
incorporation)
|
File
Number)
|
Identification
No.)
|
9107
Wilshire Blvd., Suite 450, Beverly Hills, CA 90210
(Address
of principal executive offices) (Zip Code)
Registrant's
telephone number, including area code: (310) 461-3559
With
a
copy to:
Stephen
M. Fleming, Esq.
Law
Offices of Stephen M. Fleming PLLC
110
Wall
Street, 11th
Floor
New
York,
New York 10005
T:
516.833.5034
F:
516.977.1209
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 (see General Instructions A.2. below):
¨
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨
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
2.03 Creation of a Direct Financial Obligation.
Item
3.02 Unregistered Sales of Equity Securities.
Vortex
Resources Corp. (the “Company”) entered into a Securities Purchase Agreement
(the “Agreement”) with Trafalgar Capital Specialized Investment Fund, Luxembourg
(“Buyer”) on September 25, 2008 for the sale of up to $2,750,000 in convertible
notes (the “Notes”). Pursuant to the terms of the Agreement, the Company and the
Buyer closed on the sale and purchase of $1,600,000 in Notes on September 25,
2008, with escrow instruction to be closed on October 1, 2008. The Buyer, at
its
sole discretion, has the option to close on a second financing for $400,000
in
Notes and a third financing for $750,000 in Notes. Pursuant to the terms of
the
Agreement, the
Company
agreed
to pay to the Buyer a commitment fee of 4% of the commitment amount, a
structuring fee of $15,000, a facility draw down fee of 4%, issue the Buyer
150,000 shares of common stock, pay a due diligence fee to the Buyer of $15,000
and pay an advisory fee of $100,000 to TAS Holdings Limited.
The
Notes
bear interest at 8.5% with such interest payable on a monthly basis with the
first two payments due at closing. The Notes are due in full in September 2010.
In the event of default, the Buyer may elect to convert the interest payable
in
cash or in shares of common stock at a conversion price using the closing bid
price of when the interest is due or paid. The Notes are convertible into our
common stock, at the Buyer’s option, at a conversion price equal to 85% of the
volume weighted average price for the ten days immediately preceding the
conversion but in no event below a price of $2.00 per share. If on the
conversion or redemption of the Notes, the Euro to US dollar spot exchange
rate
(the “Exchange Rate”) is higher that the Exchange Rate on the closing date, then
the number of shares shall be increased by the same percentage determined by
dividing the Exchange Rate on the date of conversion or redemption by the
Exchange Rate on the closing date. We are required to redeem the Notes starting
on the fourth month in equal instalments of $56,000 with a final payment of
$480,000 with respect to the initial funding of $1,600,000. We are also required
to pay a redemption premium of 7% on the first redemption payment, which will
increase 1% per month. We may prepay the Notes in advance, which such prepayment
will include a redemption premium of 15%. In the event we close on a funding
in
excess of $4,000,000, the Buyer, in its sole election, may require that we
redeem the Notes in full. On any principal or interest repayment date, in the
event that the Euro to US dollar spot exchange rate is lower than the Euro
to US
dollar spot exchange rate at closing, then we will be required to pay additional
funds to compensate for such adjustment.
Pursuant
to the terms of the Notes, the
Company
shall
default if (i) the
Company
fails to
pay amounts due within 15 days of maturity, (ii) failure of the Company to
comply with any provision of the Notes upon ten days written notice; (iii)
bankruptcy or insolvency or (iv) any breach of the Agreement and such breach
is
not cured upon ten days written notice. Upon default by the
Company,
the
Buyer may accelerate full repayment of all Notes outstanding and all accrued
interest thereon, or may convert all Notes outstanding (and accrued interest
thereon) into shares of common stock (notwithstanding any limitations contained
in the Agreement and the Notes). The Buyer has a secured lien on three of our
wells and would be entitled to foreclose on such wells in the event an event
of
default is entered. In the event that the foregoing were to occur, significant
adverse consequences to the Company would be reasonably
anticipated.
So
long
as any of the principal of or interest on the Notes remains unpaid and
unconverted, the
Company
shall
not, without the prior written consent of the Buyer, (i) issue or sell any
common stock or preferred stock, (ii) issue or sell any Company preferred stock,
warrant, option, right, contract,
call,
or other security or instrument granting the holder thereof the right to acquire
Common Stock, (iii) incur debt or enter into any security instrument granting
the holder a security interest in any of the assets of the
Company
or (iv)
file any registration statement on Form S-8.
The
Buyer
has contractually agreed to restrict their ability to convert the Notes and
receive shares of our common stock such that the number of shares of the Company
common stock held by a Buyer and its affiliates after such conversion or
exercise does not exceed 9.9% of the Company’s then issued and outstanding
shares of common stock.
As
of the
date hereof, the Company is obligated on the Notes issued to the Buyer in
connection with this offering. The Notes are a debt obligation arising other
than in the ordinary course of business, which constitute a direct financial
obligation of the Company.
The
Notes
were offered and sold to the Buyer in a private placement transaction made
in
reliance upon exemptions from registration pursuant to Section 4(2) under the
Securities Act of 1933 and Rule 506 promulgated thereunder. The Buyer is an
accredited investor as defined in Rule 501 of Regulation D promulgated under
the
Securities Act of 1933.
Item
9.01 Financial Statements and Exhibits.
| |
(a)
|
Financial
statements of business
acquired.
|
Not
applicable.
| |
(b)
|
Pro
forma financial
information.
|
Not
applicable.
| |
(c)
|
Shell
Company transactions.
|
Not
applicable.
|
Exhibit Number
|
|
Exhibit Description
|
| |
|
|
|
4.1
|
|
Securities
Purchase Agreement entered by and between Vortex Resources Corp.
and
Trafalgar Capital Specialized Investment Fund, Luxembourg dated September
25, 2008
|
| |
|
|
|
4.2
|
|
Convertible
Note issued to Trafalgar Capital Specialized Investment Fund,
Luxembourg
|
| |
|
|
|
4.3
|
|
Security
Agreement entered by and between Vortex Resources Corp. and Trafalgar
Capital Specialized Investment Fund, Luxembourg dated September 25,
2008
|
| |
|
|
|
4.4
|
|
Pledge
Agreement entered by and between Vortex Resources Corp. and Trafalgar
Capital Specialized Investment Fund, Luxembourg dated September 25,
2008
|
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act 1934, the registrant has
duly
caused this report to be signed on its behalf by the undersigned, thereunto
duly
authorized.
| |
VORTEX
RESOURCES CORP.
|
| |
|
| |
|
| |
By:
|
/s/
ROBIN ANN GORELICK
|
|
| |
Name:
Robin Ann Gorelick
|
| |
Title:
Corporate Secretary
|
|
Date:
|
September
30, 2008
|
| |
Beverly
Hills, California
|