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EXCEL CORP FILES (8-K) Disclosing Entry into a Material Definitive Agreement, Completion of Acquisition or Disposition of Assets, Other Events, Financial Statements and Exhibits

July 7, 2014



Item 1.01. Entry into a Material Definitive Agreement.

On June 30, 2014, Excel Corporation ("Company") and its wholly-owned subsidiary, Payprotec Oregon LLC dba Securus Payments ("Securus") entered into a Settlement and Release Agreement with E-Cig Ventures LLC ("E-Cig"), settling all amounts due and exercising its option to repurchase $200,000 of monthly portfolio residuals previously sold under the Residual Purchase Agreement and the related Option Agreement executed by Securus and E-Cig on January 28, 2014. Under the terms of the settlement, the Company paid $2.4 million in cash and issued a note to E-Cig for $300,000, payable in twelve equal monthly payments starting on October 1, 2014, at a six percent annual interest rate (the "Note"). Upon final payment of the Note, E-Cig shall surrender 1,000,000 shares of the Company's Common Stock originally issued to E-Cig in connection with the Company's purchase of E-Cig's 10% membership interest in Securus in April 2014.

Simultaneously with the settlement, the Company executed new financing arrangements with BlueAcre Ventures LLC ("BlueAcre") whereby Securus sold $100,000 of its monthly residuals for an immediate cash payment of $2.8 million, and the ability to receive additional cash payments totaling $400,000 over the next three years. BlueAcre also loaned $1.2 million to the Company under a promissory note bearing simple interest of 15% per year that may be reduced to as low as 11% per year (the "BAV Note"), such interest rate reductions based on the achievement of certain milestones with respect to signing new merchant customer applications. The BAV Note is secured by current residuals and may be prepaid by the Company anytime during the first twelve months, subject to minimum prepayment penalties. In connection with the sale of the monthly residuals and the issuance of the BAV Note, Securus entered into an ISO agreement whereby it agreed to sign new customers for merchant processing services with an affiliate of BlueAcre. The ability of the Company to receive such additional payments and interest rate reductions are tied to performance under the ISO agreement.

Item 2.01. Completion of Acquisition or Disposition of Assets. The information set forth under Item 1.01 in this Form 8-K is incorporated herein by reference. Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off- Balance Sheet Arrangement of a Registrant.



The information set forth under Item 1.01 in this Form 8-K is incorporated herein by reference.

Item 8.01 Other Events.



On July 7, 2014, the Company issued a press release announcing the foregoing transactions. A copy of the press release is being furnished as Exhibit 99.1 hereto and is incorporated by reference into this Current Report on Form 8-K.

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Item 9.01. Financial Statements and Exhibits.

Exhibits Exhibit No. Document 10.1 Portfolio Purchase Agreement effective June 30, 2014 between Payprotec Oregon, LLC (dba Securus Payments) and BlueAcre Ventures LLC. 10.2 Secured Residual Loan Agreement effective June 30, 2014 between Payprotec Oregon, LLC (dba Securus Payments) and BlueAcre Ventures LLC. 10.3 Promissory Note effective June 30, 2014 between Payprotec Oregon, LLC (dba Securus Payments) and BlueAcre Ventures LLC. 10.4 Settlement Agreement and Release effective June 30, 2014 between Payprotec Oregon, LLC (dba Securus Payments), Excel Corporation, Steven Lemma, Mychol Robirds, Shalom Auerbach, and E-Cig Ventures, LLC. 10.5 Third Amended and Restated Operating Agreement of Payprotec Oregon, LLC (dba Securus Payments)effective June 30, 2014. 10.6 Promissory Note effective June 30, 2014 between Excel Corporation and E-Cig Ventures, LLC. 99.1 Press Release dated July 7, 2014. 3



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Source: Edgar Glimpses


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