Debt Resolve Announces Delay in $7 Million Funding, AMEX Delisting

Online debt collection system provider Debt Resolve announced this week that it has granted another extension for funding to a company that is to buy $7 million in Debt Resolve’s shares. The company also announced that its stock exchange, Amex, had informed it last week that the exchange had begun delisting procedures.

White Plains, N.Y.-based Debt Resolve (AMEX: DRV) announced in April that Harmonie International LLC agreed to purchase $7 million of the company’s shares to supply Debt Resolve with cash. In Debt Resolve’s first quarter financial report, it noted that Harmonie would need an extension to fund the deal (“Debt Resolve Revenues Fall 80% as Four Major Clients Walk,” May 21). May 30 was given as the new deadline.

Wednesday, Debt Resolve said that it would grant Harmonie another extension to come up with the money. Harmonie now has until June 20 to fund the deal. Debt Resolve said in a statement that “this and prior delays were caused by Harmonie’s regulatory and trading issues unrelated to Debt Resolve.”

But the additional delay has run Debt Resolve afoul of Amex listing rules. The company said that Amex informed them on June 4 that it had started delisting procedures against Debt Resolve by announcing its intention to file a delisting application. Debt Resolve said that Harmonie’s failure to fund the stock deal by May 30 was the main reason for the action.

Debt Resolve said it will appeal the Amex intent by requesting an oral hearing and paying all required fees within the prescribed time. At the hearing the company intends to seek an additional extension of time to complete the Harmonie transaction.

Kenneth Montgomery, CEO of Debt Resolve, said in a press release, "Harmonie International is a strategic investor that will provide not only capital but also international finance and banking expertise. We are confident we will receive the Harmonie funding by June 20th and be in full compliance with the AMEX listing requirements."