Item 3.02 Unregistered Sales of Equity Securities.
Between April 1, 2016 and May 31, 2016, Algodon Wines & Luxury Development Group, Inc. (the “Company”) issued 467,556 shares of its common stock at a price of $2.50 per share to accredited investors in a private placement transaction for gross proceeds of $1,168,890. Commissions in the form of cash of $105,200 and 46,756 warrants to purchase common stock at $2.50 per share were paid to DPEC Capital, Inc., the Company’s registered broker dealer subsidiary in connection with these share issuances. DPEC Capital, Inc., in turn, awarded such warrants to its registered representatives. The investors and registered representatives all had sufficient knowledge and experience in financial, investment and business matters to be capable of evaluating the merits and risks of investment in the Company and able to bear the risk of loss. For this sale of securities, the Company relied on the exemption from registration available under Section 4(a)(2) and Rule 506(b) of Regulation D promulgated under the Securities Act with respect to transactions by an issuer not involving any public offering. No general solicitation was used in this offering. A Form D was filed on October 8, 2015.
Effective May 31, 2016, the Board of Directors of the Company approved a reduction in price from $2.50 per share to $2.00 per share of all shares of common stock issued to accredited investors pursuant to private placement transactions from October 6, 2015 through May 31, 2016. The Company issued total of 470,765 shares of additional common stock to those investors for no additional consideration. In addition, DPEC Capital, Inc. was issued 47,077 additional warrants which it, in turn, awarded such warrants to its registered representatives.
Between June 1, 2016 and July 27, 2016, the Company issued 125,000 shares of its common stock at a price of $2.00 per share to accredited investors in a private placement transaction for gross proceeds of $230,000. Commissions in the form of cash of $20,700 and 11,500 warrants to purchase common stock at $2.00 per share were paid to DPEC Capital, Inc., the Company’s registered broker dealer subsidiary in connection with these share issuances. DPEC Capital, Inc., in turn, awarded such warrants to its registered representatives. The investors and registered representatives all had sufficient knowledge and experience in financial, investment and business matters to be capable of evaluating the merits and risks of investment in the Company and able to bear the risk of loss. For this sale of securities, the Company relied on the exemption from registration available under Section 4(a)(2) and Rule 506(b) of Regulation D promulgated under the Securities Act with respect to transactions by an issuer not involving any public offering. No general solicitation was used in this offering. A Form D was filed on October 8, 2015.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on the 29 th day of July 2016.
Algodon Wines & Luxury Development
Group, Inc.
By: /s/ Scott L. Mathis
Scott L. Mathis, President & CEO
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