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): July 5, 2005
MARKETSHARE RECOVERY, INC.
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(Exact name of registrant as specified in its charter)
Delaware 0-15807 31-1190725
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(State of Incorporation) (Commission File Number) (IRS Employer
Identification No.)
33 South Service Road, Suite 111
Jericho, NY 11753
(Address of Principal Executive Offices)
(516) 750-9733
(Registrant's telephone number, including area code)
None
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(former name or former address, if changed since last report)
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-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 240.24d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.23e-4(c))
Item 3.02 Unregistered Sales of Equity Securities
On July 5, 2005, MarketShare Recovery, Inc. (the "Registrant") consummated
the private sale of its securities to Russell Kuhn (the "Purchaser"). The
securities sold were Nine Hundred and Thirty Three Thousand Three Hundred and
Thirty-Four (933,334) shares of the Registrant's common stock (the "Shares") and
Warrants (the "Warrants") to purchase an additional One Hundred and Eighty-Six
Thousand Six Hundred and Sixty-Six (186,666) shares of the Registrants Common
Stock. The aggregate purchase price for the securities was $700,000 or $.75 per
Share without allocating any part of the purchase price for the Warrants. At the
closing the Registrant delivered 933,334 Shares and 186,666 Warrants to the
Purchaser.
The Warrants entitle the Purchaser to purchase shares of the Registrant's
common stock reserved for issuance thereunder (the "Warrant Shares") for a
period of five years from the date of issuance. Twenty percent the Warrants are
exercisable per year on a cumulative basis at varying prices as set forth below:
Date(s) of Exercise Amount Exercise Price
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7/5/05 - Expiration Date 37,333 $ .60
7/5/06 - Expiration Date 37,333 $ .70
7/5/07 - Expiration Date 37,333 $ .80
7/5/08 - Expiration Date 37,333 $ .90
7/5/09 - Expiration Date 37,334 $ 1.00
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TOTAL: 186,666
Pursuant to the Subscription Agreement, the Company agreed to file with
the Securities and Exchange Commission ("SEC") a Registration Statement covering
the Shares. If such Registration Statement is not filed by the Registrant on or
before September 15, 2005 the Registrant has agreed to deliver the Purchaser an
additional Two Hundred Thousand (200,000) shares ("Penalty Shares") of
Registrant's Common Stock. If the Registrant fails to file a Registration
Statement by October 5, 2005, the Purchaser shall be entitled to an additional
One Hundred Thousand (100,000) Penalty Shares and a like number of Penalty
Shares for each month thereafter the Registrant does not file such Registration
Statement with the SEC by the fifteenth day of each successive month.
As a result of this transaction, the Purchaser owns approximately 10.43%
of the issued and outstanding shares of the Registrant's Common Stock. This
amount does not reflect an additional 344,950 shares which may be obtained by
the Purchaser from the exercise of the Warrants described above, plus and
additional 158,284 Warrants owned by the Purchaser prior to the consummation of
this transaction.
The Registrant will utilize the proceeds from this offering for general
working capital.
The securities discussed above were offered and sold in reliance upon
exemptions from the registration requirements of Section 5 of the Securities Act
of 1933, as amended (the "Act"), pursuant to Section 4(2) of the Act and Rule
506 promulgated thereunder. Such securities were sold exclusively to accredited
investors as defined by Rule 501(a) under the Act.
Item 9.01 Financial Statements and Exhibits
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c) Exhibits
10.1 Subscription Agreement
10.2 Common Stock Purchase Warrant
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.
MARKETSHARE RECOVERY, INC.
By: /s/ Mark Basile
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Mark Basile, CEO
Dated: July 7, 2005
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