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JOB > SEC Filings for JOB > Form 8-K on 2-Apr-2014All Recent SEC Filings




Entry into a Material Definitive Agreement, Unregistered Sale

Item 1.01 Entry into a Material Definitive Agreement;

On March 31, 2014, General Employment Enterprises, Inc. (the "Company") and Aracle SPF I, LLC, a New York based fund ("Aracle") entered into a Securities Purchase Agreement (the "SPA") pursuant to which Aracle has the right to acquire up to 12 units (the "Units"), for $50,000 per Unit, with each Unit consisting of 250,000 shares of common stock (the "Shares") of the Company and 125,000 common stock purchase warrants (the "Warrants"). The Warrants are exercisable 6 months after issuance, have a term of 4 years, and have an exercise price of $0.25 per warrant share. The SPA contains standard representations, warranties, and covenants. In addition, the SPA contains a price adjustment mechanism that requires the Company, with certain exceptions, to issue additional shares of common stock to Aracle in the event the Company, within twelve months of the initial closing under the SPA, issues certain equity securities at a price per share less than $0.20, provided, however, as long as the Company is listed on the NYSE MKT the total number of shares issuable under the foregoing adjustment provision may not exceed 19.9% of the Company's outstanding shares of common stock on March 30, 2014. Further, in the event the Company is delisted from NYSE MKT while Aracle owns at least 51% of the Shares issued to it under the SPA, the Company shall issue an additional 3,000,000 Shares to Aracle, and the 12 month price adjustment period shall be extended to 36 months. The Company agreed to appoint two new members to the Company's Board of Directors within 60 days of the initial closing, which new members are subject to the prior approval of Aracle. The Company granted Aracle piggyback registration rights with respect to the Shares and the shares of common stock underlying the Warrants.

Item 3.02 Unregistered Sales of Equity Securities

Concurrently with the Execution of the SPA the Company and Aracle conducted an initial closing thereunder, in which Aracle purchased 9.5 Units for $475,000. The Units and the securities underlying the Units were issued to Aracle, an accredited investor, pursuant to the exemption from registration provided by Rule 506 of Regulation D as promulgated under the Securities Act of 1933, as amended, and other applicable exemptions. The issued securities will contain a standard restricted legend. The Company incurred certain expenses related to the SPA and the initial closing thereunder of approximately $49,000, which were paid from the proceeds of the initial closing. No finder's or placement agent fees were paid in connection with the offering.

A press release detailing the foregoing transactions is furnished herewith as Exhibit 99.1

Item 9.01 Financial Statements and Exhibits.

Exhibit No.   Description
   99.1       Press release issued by General Employment Enterprises, Inc. dated April
              2, 2014

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