UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

___________

 

FORM 8-K

  ___________

 

CURRENT REPORT PURSUANT TO

SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): September 17, 2018

 

STERLING CONSOLIDATED CORP.
(Exact Name of Registrant as Specified in its Charter)
 
Nevada
(State or Other Jurisdiction of Incorporation)

 

333-183246   45-1840913
(Commission File Number)   (IRS Employer Identification No.)
     
1105 Green Grove Road, Neptune, NJ   07753
(Address of Principal Executive Offices)   (Zip Code)

 

732-918-0004

(Registrant’s telephone number, including area code):

 

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 Instruction A.2.)

 

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

 

Emerging growth company x

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

 

 

 

 

 

 

Item 1.01 Entry into a Material Definitive Agreement.

 

On September 17, 2018, Sterling Consolidated Corp. (the “Company”) entered into a Letter of Intent (the “Letter of Intent”) with Access Capital, Inc. (“Access Capital”). Pursuant to the Letter of Intent, Access Capital agreed to provide the Company with asset based financing of up to $2.5 million based on a formulaic review and analysis of the Company’s accounts receivable and inventory. Pursuant to the Letter of Intent, the Company has paid Access Capital a non-refundable due diligence fee of $10,000 and Access Capital has completed an on-site audit of the Company’s assets for the week ended October 12, 2018 as part of the due diligence process thereunder. The Company expects to complete the due diligence process under the Letter of Intent with Access Capital, Inc. and close on the financing thereunder within the next thirty (30) days. However, there can be no assurance that the foregoing can occur as planned. Further, the Letter of Intent is an expression of interest only and does not constitute a binding agreement, and any financing to be provided by Access Capital to the Company under the Letter of Intent will be pursuant to the execution and delivery of a definitive agreement between the Company and Access Capital. The foregoing discussion of the Letter of Intent does not purport to be complete and is qualified in its entirety by reference to such Letter of Intent, which is filed as Exhibit 10.1 hereto, and is incorporated herein by reference.

 

Item 7.01 Regulation FD Disclosure.

 

On October 15, 2018, the Company issued a press release announcing the Letter of Intent. A copy of this press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information contained in the websites mentioned in the press release is not a part of this current report on Form 8-K. Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. The information set forth under this Item 7.01 shall not be deemed an admission as to the materiality of any information in this Current Report on Form 8-K that is required to be disclosed solely to satisfy the requirements of Regulation FD. 

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.   Description
     
10.1   Letter of Intent with Access Capital, Inc.
99.1   Press Release Dated October 15, 2018.

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  STERLING CONSOLIDATED CORP.
   
Dated: October 18, 2018 /s/ Scott Chichester
  Scott Chichester
  Chief Financial Officer

 

 

Exhibit 10.1

 

 

 

 

 

 

Exhibit 99.1  

 

Sterling Consolidated Signs a Term Sheet for $2.5 million of Asset-Based Financing

 

PR Newswire

 

NEPTUNE, N.J., October 15, 2018 /PRNewswire/ -- Sterling Consolidated Corp. (OTC: STCC) (The Company), a leading supplier of hydraulic and pneumatic seals to the automotive and industrial marketplace for almost 50 years, and creator of the blockchain based DiMO Token, today shared news regarding its financing plans.

 

The Company today announced that they have signed a $2.5 million term sheet to obtain financing with New York City asset-based lender, Access Capital, Inc. (“Access Capital”). The term sheet calls for capital availability of $2.5 million based on a formulaic review and analysis of the Company’s accounts receivable and inventory. The Company has paid Access Capital a non-refundable due diligence fee of $10,000 and completed an on-site audit of their assets for the week ended October 12, 2018 as part of the due diligence process.

 

 

 

"We intend to make the switch from traditional commercial bank financing to asset-based lending, said CEO, Darren DeRosa. “Asset-based lending has some significant advantages over traditional bank financing. For one, we will not be subject to restrictive net income covenants and can be more focused on growth and expansion. It also aligns with our roll-up strategy to acquire other o-ring businesses by offering increased flexibility and a faster approval process. For example, if we find an attractive acquisition target in the o-ring sector, we will be able to increase the amount of our existing financing based on the size and quality of the target company’s assets – and move swiftly. In effect, we can leverage the balance sheet of the target company to increase our asset-based credit line which can then be used to make the acquisition of the target itself. This is powerful.”

 

 

 

  

The Company expects to complete the due diligence process with Access Capital, Inc. and close on the financing within the next 30 days.

 

For more information visit:  http://investor.sterlingconsolidated.com

 

About Sterling Consolidated Corp.

 

Sterling Consolidated Corp. , through its wholly-owned subsidiary,  Sterling Seal and Supply  is a leading supplier of hydraulic and pneumatic seals to the automotive and industrial marketplace for almost 50 years as well as an approved supplier to  Amazon  and  Walmart . The Company has 5 locations throughout the USA, and plans to acquire more through its ongoing acquisition strategy. The Company is also the creator of the DiMO, a blockchain based cryptocurrency, that they hope brings an edge to the industry and improves overall profits and efficiencies through the use of smart contracts.

 

Investor & Media Contact:

 

Scott Chichester, CFO -  schichester@sterlingconsolidated.com
Source:  Sterling Consolidated Corp -  http://www.sterlingconsolidated.com

 

Forward-looking Statements

 

This release contains statements that constitute forward-looking statements. These statements appear in a number of places in this release and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things: (i) the Company's financing plans; (ii) trends affecting the Company's financial condition or results of operations; (iii) the Company's growth strategy and operating strategy; and (iv) the declaration and payment of dividends. The words "may" "would," "will," "expect," "estimate," "anticipate," "believe," "intend," and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company's ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors.

 

Legal Disclaimer

 

No money or other consideration is being solicited for our Regulation A+ offering at this time and if sent in to Sterling Consolidated Corp. will not be accepted.  No offer to buy securities in a Regulation A+ offering of Sterling can be accepted and no part of the purchase price can be received until Sterling's offering statement is qualified with the SEC.  Any such offer to buy securities may be withdrawn or revoked, without obligation or commitment of any kind, at any time before notice of its acceptance given after the qualification date.  Any indications of interest in Sterling's offering involves no obligation or commitment of any kind.

 

1  Source  https://www.futuremarketinsights.com/reports/gaskets-and-seals-market

 

SOURCE Sterling Consolidated Corp.