UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of the Securities and Exchange Act of 1934
Date
of
Report (Date of earliest reported): May 14, 2007
EMVELCO
CORP.
(Exact
name of registrant as specified in charter)
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Delaware
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001-12000
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13-3696015
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(State
or other jurisdiction
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(Commission
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(IRS
Employer
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of
incorporation)
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File
Number)
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Identification
No.)
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468
N.
Camden Drive, Suite 315, Beverly Hills, CA 90210
(Address
of principal executive offices) (Zip Code)
Registrant's
telephone number, including area code: (310) 285-5350
Copies
to:
Gregory
Sichenzia, Esq.
Stephen
M. Fleming, Esq.
Sichenzia
Ross Friedman Ference LLP
61
Broadway
New
York,
New York 10006
Phone:
(212) 930-9700
Fax:
(212) 930-9725
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 (see General Instructions A.2. below):
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
1.01 Entry
into a Material Definitive Agreement
On
May
14, 2007, Emvelco Corp. (the “Company”) entered into a Stock Transfer and
Assignment of Contract Rights Agreement (the “Agreement”) with Emvelco RE Corp.,
a Nevada corporation (“ERC”), ERC’s principal shareholder The International
Holdings Group Ltd., a corporation formed and registered in the Marshall Islands
(“TIHG”) and ERC’s wholly owned subsidiary Verge Living Corporation, a Nevada
corporation (“Verge”). Pursuant to the Agreement, the Company transferred and
conveyed its 1,000 Shares (representing a 43.33% interest) (the “Shares”) in ERC
to TIHG to submit to ERC for cancellation and return to Treasury. ERC, TIHG
and
Verge agreed to assign (the “Assignment”) to the Company all rights in and to
that certain Investment Agreement, dated as June 19, 2006, and all Amendments
thereto (collectively, the “Investment Agreement”) wherein ERC (from funds
available to ERC from the Company) agreed to provide secured loans to Verge
for
the construction of a multi-use condominium and commercial property in Las
Vegas, Nevada (the “Verge Property”) and for other projects and properties as
provided therein. The Investment Agreement was disclosed by the Company in
its
Form 8-K filed on June 23, 2006.
The
consideration payable to the Company under the Agreement is $500,000, which
in
TIHG’s discretion, may be added to the outstanding loan amount owing to the
Company by ERC (the “Loan Amount”). As of May 14, 2007, the current outstanding
Loan Amount owing to the Company is approximately $12 million. Under the
Agreement, in no event shall the Loan Amount exceed eighty percent (80%) of
the
fair market value of the Verge Property. As a condition precedent to the
Agreement, a current appraisal of the Verge Property shall be presented and
delivered to the Company within two weeks of the date of the
Agreement.
The
effective date of the Agreement is January 1, 2007 (the “Effective Date”). All
rights assigned to the Company under the Investment Agreement will be considered
to be assigned as of the Effective Date. Accordingly, as of the Effective Date,
the Company shall be the sole secured and primary beneficiary under the
Investment Agreement.
As
of the
Effective Date, under the Investment Agreement, each loan made to Verge is
due
on demand or upon maturity on January 14, 2008. If the Company requests that
the
funds be paid on demand prior to maturity, then Verge shall be entitled to
reduce the amount requested to be prepaid by 10%. The 10% discount will be
paid
in the form of shares of common stock of the Company, which will be computed
by
dividing the dollar amount of the 10% discount by the market price of the
Company's shares of common stock. The terms of the loans require that the
Company, be paid-off the greater of (i) the principal including 12% interest
per
annum or (ii) 33% of all gross profits derived from the Verge Property. In
addition, the Company has the right to acquire the Verge Property for a purchase
price of $15,000,000 through January 1, 2015. The purchase is payable in
$10,000,000 in cash and $5,000,000 in shares of common stock of the Company.
The
Board
of Directors of the Company has approved the Agreement and ratified the
transaction thereunder.
Item
9.01 Financial Statements and Exhibits
(d)
Exhibits
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Exhibit
No.
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Description
of Exhibit
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10.1
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Stock
Transfer and Assignment of Contract Rights
Agreement
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act 1934, the registrant has
duly
caused this report to be signed on its behalf by the undersigned, thereunto
duly
authorized.
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EMVELCO
CORP.
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| Date: May
16,
2007 |
By: |
/s/ YOSSI
ATTIA |
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Beverly
Hills, California
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Name:
Yossi Attia
Title:
Chief Executive Officer
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