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Harvey Electronics Mulls Tender Offer Tuesday April 4, 12:06 pm ET Harvey Electronics Tells Shareholders to Delay Acting on Modern Technology Tender Offer
LYNDHURST, N.J. (AP) -- Home theater products retailer Harvey Electronics Inc. on Tuesday told shareholders to delay acting on a tender offer for the company's shares issued Monday by Modern Technology Corp. until more information is available.
Modern Technology Corp., a technology development and acquisition company, has offered to pay $1.15 per share in cash and convertible warrants for 51 percent of Harvey's outstanding shares. That represents a 29.2 percent premium over Harvey's Monday closing price of 89 cents per share.
Harvey Electronics had 3.5 million outstanding shares as of Jan. 28, according to a recent filing with the Securities and Exchange Commission. Modern Technology's offer values 51 percent of those shares at about $2.1 million combined.
Harvey said the board will advise shareholders of its position and respond to the offer when it receives additional information from Modern Technology. The offer is set to expire May 1.
Modern Technology said it won't purchase any Harvey shares at all if less than 51 percent are tendered. The offer consists of 80 cents a share in cash, and 35 cents a share in convertible warrants, which give the holder the right to buy Modern stock at a set price.
Modern Technology said it secured investor commitment for $1.5 million cash to support the offer. The amount the company says it will need to fund the initial cash portion of the offer and related fees and expenses.
Shares of Harvey Electronics fell 12 cents, or 13.5 percent, to 77 cents in morning trading on the Nasdaq. The stock has traded between 54 cents and $1.59 over the past year.
Posts: 216 | Registered: Mar 2006
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posted
I think that the only thing that will really move us up are some strong Q's. We need to demonstrate growth and profitability to get new investors. This I feel is what will definitely send us to higher share prices. In due time, in due time. Patience is what we need. JMHO.
Posts: 1289 | Registered: Dec 2005
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posted
I posted an angry response on the Yahoo HRVE board this morning. It made me realize how pacifistic I am. Posts: 807 | From: Upstate NY | Registered: Dec 2005
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Hoping we get the green light from HRVE soon. These prices are ridiculous.
OSU is a basher, maybe paid, who has come over from RB. We welcome anyone who has something constructive to say, backed with information and research, but we don't welcome bashers here. So go back to RB and fight with those fellas.
I really like having doms on the bid, he tends to put those who have been shorting straight.
Kat
Posts: 1351 | From: Phoenix Az | Registered: Nov 2005
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Entry into a Material Definitive Agreement, Creation of a Direct Financial
Item 1.01 Entry into a Material Definitive Agreement On March 27, 2006, the Company entered into a Securities Purchase Agreement with AJW Partners, LLC, AJW Offshore, LTD., AJW Qualified Partners, LLC., and New Millennium Capital Partners, LLC. (collectively Buyers). Under the terms of the Securities Purchase Agreement, Buyers purchased 6% Convertible Secured Notes in the aggregate amount of $350,000, and Warrants to purchase shares of common stock. Please see Items 2.03 and 3.02 for more details on this transaction.
In conjunction with the Securities Purchase Agreement, the Company entered into an Intellectual Property Security Agreement and a Security Agreement, both dated March 27, 2006. The terms of these agreements, respectively, grant first priority to Buyers for intellectual property rights and security rights to property of the Company. Company entered into these agreements to guarantee payment under the terms of the Convertible Notes.
Section 2 - Financial Information
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. On March 27, 2006, the Company, pursuant to a Securities Purchase Agreement of the same date, entered into Callable Secured Convertible Notes. Under the terms of the notes, the Company borrowed an aggregate of $350,000.00 from the Holders of the Notes. The Notes each bear a Maturity Date of March 27, 2009, with interest accruing on any unpaid principal at 6% per annum from the date the Notes were issued, until due and payable on the Maturity Date. Any unpaid amounts after that date bear an interest of 15% per annum. Interest is payable quarterly and shall commence at June 30, 2006. Holder has the right to convert any amounts due to Common Stock, at its discretion, at the conversion price, as set forth under the terms of the Notes. Following is a table showing the holders and amount of each Note.
HOLDER AMOUNT OF NOTE AJW Offshore, LTD $213,500 AJW Partners, LLC $38,500 AJW Qualified Partners, LLC $94,500 New Millennium Capital Partners, LLC $3,500
Section 3 - Securities and Trading Markets
Item 3.02 Unregistered Sales of Equity Securities On March 27, 2006, the Company entered into a Securities Purchase Agreement with the parties referenced in Item 2.03 above (Buyers). Under the terms of the Securities Purchase Agreement, the Buyers collectively purchased 6% Convertible Securities Notes in the aggregate amount of $350,000.00, convertible into common stock at the option of the Buyers, and Warrants to purchase shares of the Company's common stock. There were no underwriting fees or commissions paid in connection with this offering. Notes and Warrants were sold pursuant to Rule 505, Regulation D of the Securities Act of 1933. Securities purchased are convertible into shares of Common Stock pursuant to the terms set forth in the Callable Secured Convertible Note (attached hereto as an exhibit) and the Stock Purchase Warrant (attached hereto as an exhibit). Securities purchased hereunder are also provided Registration Rights, as set forth in the Registration Rights Agreement dated March 27, 2006, and filed herewith as an exhibit.
posted
Here's the financing. He is not financing the entire amount here. Personally, I think he already purchased the shares on March 7th on the open market. HRVE did 1.25 mil in volume that day and the pps didnt move a lick.
IMO this is a done deal, waiting to hammer out the details and make HRVE shareholders feel good.
Posts: 1351 | From: Phoenix Az | Registered: Nov 2005
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Kat and I have been doing some math. Follow along.
First of all, the material event which we all believe to MOTG purchasing shares of HRVE:
Look at the volume spike on March 7. 1.25 million. Volume that size was $#*! times average volume for HRVE. We are speculating that this is the day Welch and MOTG began buying HRVE. Also note the minimal price movement on that date, compared to say April 2. Price per share didn't budge despite massive volume in March but volume half that size in April caused it to run nearly 40%. The fact that the mega-volume on March 7 didn't budge HRVE's pps supports our theory that this was a pre-arranged sale, which may have occured after hours. When corprations buy other corporations, this is what it looks like.
On to the math. If MOTG did indeed buy a massive amount of Harvey on that date, this is how it happened. 1,250,000 x .65 (HRVE's average price that day)= $812,500 So whoever did that buying spent about $800,000 acquiring shares of HRVE.
Remember that HRVE only has an O/S of 3.5 million. So, in order for someone to take a 51% controlling interest in HRVE they would have to own:
51% of 3,500,000 shares = 1,785,000 shares
Let's say that Welch bought those 1.25m shares on March 7.
1,785,000 - 1,250,000 = 535,000 shares left to own 51% of HRVE
So Welch would have about 535,000 shares left to buy if he wanted to own 51% of HRVE. Notice that none of this so far as required him to ask permission of anyone.
535,000 shares x .70 (about HRVE's current share price) = $374,500 required to buy the rest of HRVE.
Today's 8-k details that Welch just borrowed $350,000 from AJW.
Need I say more? We think this thing is done Posts: 953 | From: Southwest USA | Registered: Nov 2005
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Your explanation sounds convincing enough to me! Now, let's get the show on the road! Posts: 807 | From: Upstate NY | Registered: Dec 2005
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posted
I sold 45000 yesterday * .028, and was sweating bullets until I got filled this morning with the same amount of scratch with 49350 shares *.025. Now Im trying to get another buy in before EOD.
Now my average just went from .0456 down to .025 with 4000 more shares!
Very good analysis. Makes a lot of sense. I think one way or another we're gonna acquire Harvey Electronics. They can come willingly or we can just take control. I hope they come on our terms. GLTA
Posts: 1289 | Registered: Dec 2005
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quote:Originally posted by binsleep: The traffic has really picked up on the RB MOTG board since Jag got back on board
Also, I got a cameo over there! Someone posted my Yahoo message....Sweet
You are referring to "mr momo," right? I don't think it was him, but the news of the potential acquisition. It's what everyone has been waiting for. Now we need to make sure it materializes. After that, some strong Q's and we're off to the races. Sounds easy. If our CEO does his job we can do it. JMHO. GLTA Posts: 1289 | Registered: Dec 2005
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RB: Yeah, Mr. Momo. I was only kidding. I am happy to have him around again, though.
Posts: 807 | From: Upstate NY | Registered: Dec 2005
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posted
hopefully harvey accepts this offer, then to the moon we go, because nasdaq investors will take notice of this penny stock and run it up, maybe..
Posts: 664 | Registered: Jun 2005
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