VSI.V - Vendtek Systems Inc
VSI.V - Vendtek Systems
Most recent financial results, including up to date news releases. This is a restructured tech company with an established clientele basis around the world for prepaid cards, pos systems and other devices. The stock has been rolled back and injected with over $2 million cash from only a couple sources over the last 9 months.
Price: $0.04
Common Shares: 7,264,583 (Now at 16,743,151 after recent placements)
Insider/Institutional Holdings: 80% as per Sedi
Funds Raised in 2015:
1) $150,000 Placement to F3 Capital at 10.5c a share (January 2015)
2) $350,000 Debenture to F3 Capital at 1% interest and 50c exercise price(February 2015)
3) $663,499 Placement at 7c. Mostly F3 Capital, Flipe Ayres and Logistics(June 2015)
4) $1,000,000 Debenture from F3 Capital at 12% interest and 10.5c exercise price(Sept 2015)
Company Websites: http://www.vendteksystems.com/ and http://www.nowprepay.com/
Quarterly Results, ending April 30th 2015(most recent).
ASSETS
Cash: $117,923 (Now at $1,781,422 after last two placements)
Accounts Receivables: $73,640
Prepaid Expenses: $83,662
Property & Equipment: $71,624
Intangible Assets: $51,124
LIABILITIES
Payables: $1,996,797
Finance Lease: $17,393
Convertible Debenture(Short term): $860,000
Short Term Loan: $790,287
Capital Lease Obligations: $29,720
Long Term Debenture: $861,506
MD&A Highlights
Our principal product is our proprietary eFresh™ software which consists of a suite of server applications and corresponding end point device software. The eFresh™ software is used to create a distribution and transaction processing system which can be used to sell services on proprietary or non-proprietary hardware thereby creating an eFresh™ network. Our eFresh™ software creates a digital or electronic payment mechanism as a replacement for cash that allows the system to act as an electronic data warehouse in certain business transactions. Internationally, we have licensed our software to allow our partners to develop a local e-distribution network. The software has other potential applications in situations where businesses are looking to replace cash as a mechanism for payment (i.e. gift cards; prepaid credit cards; bill payment; international mobile top-up and micromoney transfer; prepaid utilities and prepaid cable TV). The eFresh™ software utilizes point-of-sale (“POS”) terminals and other electronic terminals as distribution points (located in retail locations) which connect to a central server and provide secure electronic distribution for prepaid goods and services to consumers in real time. Third party kiosks, bank machines, POS terminals, PC computers, mobile phones, and any (including mobile) web browser are all potentially suitable distribution points. Compared to the traditional method of delivering prepaid services using cards or plastic vouchers, distributing these services electronically allows substantial savings through reduced printing and packaging costs, physical distribution costs and shrinkage (theft), as well as the elimination of inventory holding costs at the retail distribution level. We also have developed applications for distribution using Android and IOS devices.
In August 2014 the Company lost control of its Brazilian subsidiary, Now Prepay Serviços de Informática Ltda which led to a deconsolidation of its financial statements. Subsequently to these events, the Company, in the first quarter of 2015, terminated any and all efforts related to developing its own network in Brazil started focusing solely on selling its eFreshTM software to third parties.
Our Strategy
Our primary goal is to maximize our revenue by helping our clients to develop their own networks, seeking a higher number of transactions and higher volume of products processed through our eFresh™ software. To achieve this goal, our focus is:
1. 1. To offer eFreshTM as a Service to third party networks that have chosen not to develop their own technology;
2. Expande eFreshTM’s capability to create multiple solutions to multiple industries within the payment and transaction processing segment.
When we license our software we provide technical support for our customers to ensure they have the opportunity to grow their businesses quickly and cost effectively. To help our users and licencees expand their distribution networks (serving to increase our revenues), we often provide customized solutions. Our licensing model often provides a tiered structure, stipulating minimum monthly fees should the monthly transaction not meet a required level.
We have also moved to providing software as a service (“SaaS”) solution for some of our international customers. This allows us to leverage our existing operations, eFresh™ servers, infrastructure and core competencies while at the same time letting our international customers focus on growing their business quickly, without expending the time and effort to set up a back office system. Additionally, SaaS allows our customers to launch their networks faster than if deploying an in-country server. We can now launch a new customer in a matter of a few weeks under the right circumstances. Our staff has extensive experience in managing all the operating details of the back office aspect of running an eFresh™ network. By letting our customers use this experience, we can immediately provide to them years of operating knowledge. The strategy further benefits the Company by deepening the relationship between our customers and us. The SaaS solution takes advantage of devices that can use the Internet to securely connect to our servers. These devices include POS terminals that use a cellular data connection, mobile phones and PC’s running our eFresh™ PC software. Depending on the extent of the services provided, we are able to charge a higher license fee to those customers using our SaaS offer than under our traditional licensing arrangements.
Subsequent events
On June 5, 2015 the Company closed its previously announced non-brokered private placement of 9,478,568 units of the Company (each a "Unit") at a price of $0.07 per Unit for gross proceeds of $663,499.76 (the "Offering"). Each Unit was comprised of one common share in the capital of the Company (each a "Common Share") and one warrant (each a "Warrant"). Each Warrant is exercisable to purchase one Common Share at a price of $0.25 (subject to adjustment) for a period of three years from the date of issuance. The net proceeds from the Offering will be used for general corporate purposes, including working capital. As at April 30, 2015, $374,000 of the proceeds had been received by the Company and are included in short term loans
Outlook
We have a multi-point strategy to drive growth with the primary goal of increasing the number of transactions processed through our eFresh™ system globally. We have three main priorities for fiscal 2015:
1. Increasing international license revenues
2. Continuing to invest in and build out our eFresh™ platform, and
3. Drive towards overall Company EBITDA and cash flow profitability.
From the last quarterly news release:
"Since the beginning of the current quarter, our company has refocused its business to solely operate as a software provider, having eFresh as its core product. While this decision was inevitable due to the company's inability to raise sufficient funds in order to support the growth in its distribution network, it was also supported by our strong belief that our eFresh technology can, with the adequate sales team and structure, generate significant value to our shareholders," said Felipe Ayres, VendTek's chief executive officer.
Recent news:
VendTek closes $1-million debenture financing with F3
2015-09-02 13:45 MT - News Release
An anonymous director reports
VENDTEK ANNOUNCES $1,000,000 PRIVATE PLACEMENT OF DEBENTURES
VendTek Systems Inc. has closed its previously announced non-brokered private placement of $1-million in secured convertible debentures to F3 Capital Partners Ltd. The debentures bear interest at a rate of 12 per cent annually, will mature on the date that is three years from the closing of the private placement and entitle the holder thereof to acquire common shares of the company at a price of 10 cents per common share on conversion.
The net proceeds from the private placement will be used for general corporate purposes, including working capital.
All securities issued in connection with the private placement will be subject to a four-month-and-one-day hold period that will expire on Jan. 3, 2016.
The private placement may be considered a related party transaction pursuant to applicable securities laws due to the fact that certain insiders of the company participated in the private placement. The private placement is exempt from the formal valuation requirements under securities laws as the transaction involves the distribution of securities of the company for cash, and neither the company nor, to the knowledge of the company, the related parties participating in the private placement had knowledge of any material information concerning the company or its securities that has not been generally disclosed. The private placement is exempt from the minority approval requirements under securities laws as the transaction involves the distribution of securities for cash, the fair market value of the private placement is less than $2.5-million and all of the company's independent directors have approved the private placement.
As a result of the private placement, the related party will have the change in ownership of the company as shown in the attached table.
Related party Number (and %) of Number (and %) of
voting securities voting securities
before private placement after private placement
F3 Capital Partners Ltd. 5,414,351 (32.33%) 5,414,351 (32.33%)
If all of the convertible securities held by F3 Capital Partners Ltd. were converted (including the debentures issued pursuant to the private placement), F3 Capital Partners would hold 21,528,702 (65.52 per cent) of the voting securities of the company after the private placement.
We seek Safe Harbor.
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