SECURITIES
AND EXCHANGE COMMISSION
UNITED
STATES
Washington,
DC 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)
December
4, 2008
A21,
INC.
(Exact
name of registrant as specified in its charter)
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Florida
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000-51285
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74-2896910
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(State
or other jurisdiction
of
incorporation)
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(Commission
File
Number)
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(IRS
Employer
Identification
No.)
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7660
Centurion Parkway
Jacksonville,
Florida
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32256
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant's
telephone number including area
code: (904)-565-0066
Not
Applicable
(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:
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01Entry into a Material Definitive
Agreement.
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The
disclosures in Item 1.03 below regarding the purchase agreements (as described
below) are incorporated herein by reference.
Item
1.03 Bankruptcy
or Receivership.
On
December 4, 2008, a21, Inc. (the “Company”) and its wholly owned subsidiaries
ArtSelect, Inc. and SuperStock, Inc. (collectively, the “Debtors”) filed
voluntary petitions in the United States Bankruptcy Court for the Middle
District of Florida, Jacksonville Division (the “Bankruptcy Court”) seeking
reorganization relief under the provisions of Chapter 11 of Title 11 of the
United States Code (the “Bankruptcy Code”) (collectively, the “Chapter 11
Cases”). The Chapter 11 Cases will be jointly administered and the
Debtors will continue to operate their business as debtors-in-possession under
the jurisdiction of the Bankruptcy Court and in accordance with the applicable
provisions of the Bankruptcy Code and the orders of the Bankruptcy
Court.
In
accordance with the filing of the Chapter 11 Cases, the Company entered
into: an asset purchase agreement (the “ArtSelect Asset Purchase
Agreement”) with Metaverse Corporation (“Metaverse”) on December 3, 2008; and an
asset purchase agreement (the “SuperStock U.S. Asset Purchase Agreement”) with
Masterfile Corporation (“Masterfile”) on December 3, 2008. The
Company intends to enter into a stock purchase agreement (the “SuperStock U.K.
Stock Purchase Agreement”) with a third party.
Pursuant
to the ArtSelect Asset Purchase Agreement, upon the closing of the transactions
contemplated thereby, Metaverse will purchase substantially all of ArtSelect’s
assets other than cash and accounts receivable through a supervised sale under
Section 363 of the Bankruptcy Code. Under the ArtSelect Asset
Purchase Agreement, the purchase price to be paid by Metaverse for such assets
is $700,000 (the “ArtSelect Purchase Price”). The ArtSelect Purchase
Price includes the payment by Metaverse of a deposit in the amount of $50,000
(the “Deposit”) upon the execution of the ArtSelect Asset Purchase Agreement,
which Deposit shall be held in a non-interest bearing escrow account until the
closing of the transactions contemplated under the ArtSelect Asset Purchase
Agreement or the termination of the ArtSelect Asset Purchase Agreement, as
applicable. In the event of the termination of the ArtSelect Asset
Purchase Agreement, the Deposit shall be refunded to Metaverse.
Pursuant
to the SuperStock U.S. Asset Purchase Agreement, upon the closing of the
transactions contemplated thereby, Masterfile will purchase substantially all of
SuperStock’s U.S. assets other than cash and accounts receivable through a
supervised sale under Section 363 of the Bankruptcy Code. Under the
SuperStock U.S. Asset Purchase Agreement, the purchase price to be paid by
Masterfile for such assets is $1,500,000 (the “SuperStock U.S. Purchase
Price”). The SuperStock U.S. Purchase Price includes the payment by
Masterfile of a deposit in the amount of $50,000 (the “Deposit”) upon the
execution of the SuperStock U.S. Asset Purchase Agreement, which Deposit shall
be held in a non-interest bearing escrow account until the closing of the
transactions contemplated under the SuperStock U.S. Asset Purchase Agreement or
the termination of the SuperStock U.S. Asset Purchase Agreement, as
applicable. In the event of the termination of the SuperStock U.S.
Asset Purchase Agreement, the Deposit shall be refunded to
Masterfile.
Consummation
of the transactions contemplated by the purchase agreements are subject to
higher or better offers, approval of the Bankruptcy Court and customary closing
conditions. Under the terms of the purchase agreements, the Company
intends to file motions for orders granting authority to sell its assets to the
parties described above pursuant to Section 363 of the Bankruptcy Code,
establishing bidding procedures, designating the parties described above as the
stalking horse bidders and setting a hearing date on the sale of the
assets.
The
foregoing descriptions of each of the purchase agreements are general
descriptions only and are qualified in their entity by reference to the purchase
agreements, as applicable. Copies of the purchase agreements are
attached as Exhibits 10.1 and 10.2 to this Current Report on Form 8-K and are
incorporated herein by reference.
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Item
2.04Trigger Events That Accelerate or Increase a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet
Arrangement.
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The
filing of the Chapter 11 Cases constituted an event of default under the a21,
Inc. 5% Senior Secured Convertible Notes in the principal amount of $15.5
million plus accrued interest and costs. Under the terms of the 5%
Senior Secured Convertible Notes, the entire unpaid principal and accrued
interest became immediately due and payable without any action on the part of
the holders.
The
filing of the Chapter 11 Cases constituted an event of default under the
ArtSelect, Inc. 6% Notes in the principal amount of $2.4 million plus accrued
interest and costs. Under the terms of the 6% Notes, the holders may
demand the entire unpaid principal and accrued interest become immediately due
and payable.
On
December 4, 2008, the Company issued a press release announcing the Debtors’
Chapter 11 petition filings, a copy of which is attached as Exhibit 99.1 to this
Current Report on Form 8-K and is incorporated herein by reference.
On
December 4, 2008, in connection with the Chapter 11 Cases, the Company released
an Executive Summary that provides an overview of the Debtors’
business. The Company will provide this Executive Summary to
potential builders interested in participating in the Bankruptcy Code Section
363 auction and asset sales the Company plans to undertake. A copy of
the Executive Summary is attached as Exhibit 99.2 to this Current Report on Form
8-K and is incorporated by reference.
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Item
9.01Financial Statements and
Exhibits.
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Exhibit No
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Description
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10.1
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Asset
Purchase Agreement dated as of December 3, 2008, with Metaverse
Corporation for the assets of ArtSelect, Inc.
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10.2
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Asset
Purchase Agreement dated as of December 3, 2008, with Masterfile
Corporation for the U.S. assets of SuperStock, Inc.
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99.1
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Press
Release of a21, Inc. dated December 4, 2008, announcing Chapter 11
petition filing dated December 4, 2008
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99.3
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Executive
Summary describing the Company for potential bidders.
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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.
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a21,
Inc.
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(registrant)
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Date: December
4, 2008
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By:
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/s/
R. LaDuane Clifton
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R.
LaDuane Clifton
Chief
Financial Officer
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