XML 30 R7.htm IDEA: XBRL DOCUMENT v2.4.0.8
Merger
9 Months Ended
Sep. 30, 2014
Merger [Abstract]  
Merger

Note 1 - Merger

 

On January 6, 2014, Kogeto, Inc., a Nevada corporation (formerly Northeast Automotive Holdings, Inc.) (“we,” “us,” “our,” the “Company” or “Kogeto”) completed a “reverse merger” transaction (the “Merger”), in which Kogeto Acquisition Corp., a Delaware corporation and our newly-created, wholly-owned subsidiary (“Merger Sub”), merged with and into Kogeto Technologies, Inc., a Delaware corporation (formerly Kogeto, Inc.) (“ Kogeto Tech”). As a result of the Merger, Kogeto Tech became our wholly-owned subsidiary, with Kogeto Tech's former stockholders acquiring a majority of the outstanding shares of our common stock. The Merger was consummated under Delaware corporate law and pursuant to an Agreement and Plan of Merger, dated as of March 17, 2013 (the “Merger Agreement”), as discussed below. On December 31, 2013, in anticipation of closing the Merger, we also completed a private placement of 7,142,855 shares or our common stock at $0.28 per share and warrants to purchase an additional 1,428,570 shares of our common stock to accredited investors for gross proceeds of $2,000,000, and received net proceeds of $1,719,850 at the closing of the private placement, inclusive of the conversion of $450,000 in bridge financing. The warrants have an exercise price of $0.32 per shares and a term of five years. In connection with the Private Placement, we issued warrants to the placement agents to purchase 685,713 shares of common stock with an exercise price of $0.32 per share exercisable for a period of 5 years.

 

Pursuant to the Merger Agreement, at closing, we issued 24,357,087 shares of our common stock to the former stockholders of Kogeto Tech, representing 68% of our outstanding common stock following the Merger and private placement (inclusive of 7,142,855 shares of common stock sold in the private placement), in exchange for 100% of the outstanding shares of Kogeto Tech common stock. Included in the 24,357,087 shares of our common stock issued in the Merger were 10,040,223 shares of our common stock issued to the holders of 3,916,655 shares of Series A preferred stock of Kogeto Tech and 9,932,094 shares of our common stock issued to the holders of 7,284,000 shares of common stock of Kogeto Tech.

 

As part of the transaction, we also acquired all of the outstanding membership interests of Kogeto Lucy, LLC, an entity that owned certain intellectual property associated with Kogeto Tech's products, from Jeff Glasse, its sole member, in exchange for the issuance of 1,000 newly-issued shares of our common stock.

 

Subsequent to completion of the Merger, on or about January 14, 2014, pursuant to the terms of a Subsidiary Purchase Agreement, we sold all of the outstanding shares of our subsidiary, Northeast Automotive Acceptance Corp., through which we had previously conducted our business, to the former Chief Executive Officer of our company, in exchange for the return and cancellation of 5,827,656 shares of our common stock that he owned.

 

The Merger is being accounted for as a “reverse merger,” since the stockholders of Kogeto Tech own a majority of the outstanding shares of our common stock immediately following the Merger. Kogeto Tech is deemed to be the acquirer in the Merger and, consequently, the assets and liabilities and the historical operations that will be reflected in the financial statements will be those of Kogeto Tech and will be recorded at the historical cost basis of Kogeto Tech. In order to reflect the change in capitalization, earnings per share was recast for all historical periods to reflect the exchange ratio.