<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 24, 1999
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------
ESOFT, INC.
(Exact Name of Registrant as Specified in its Charter)
<TABLE>
<S> <C> <C>
DELAWARE 7372 84-0938960
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)
</TABLE>
295 INTERLOCKEN BOULEVARD, SUITE 500
BROOMFIELD, COLORADO 80021
(303) 444-1600
(Address and Telephone Number of Registrant's Principal Executive Office)
JEFFREY FINN
295 INTERLOCKEN BOULEVARD, SUITE 500
BROOMFIELD, COLORADO
(303) 444-1600
--------------
(Name, Address and Telephone Number of Agent for Service)
With Copies To:
LESTER R. WOODWARD, ESQ.
DAVIS, GRAHAM & STUBBS LLP
370 SEVENTEENTH STREET, SUITE 4700
DENVER, COLORADO 80202
(303) 892-9400
--------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
--------------
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=====================================================================================================================
Proposed Proposed
Shares maximum maximum
Title of each class of to be offering price aggregate Amount of
securities to be registered registered(1) per share(2) offering price(2) registration fee(2)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value 1,471,919 $14.75 $21,710,805 $6,035
=====================================================================================================================
</TABLE>
(1) Pursuant to Rule 416, this registration statement also covers such
indeterminate number of shares of eSoft, Inc. common stock as may be
issued as a result of stock dividends, stock splits or similar
transactions prior to the termination of this registration statement.
(2) Estimated solely for the purpose of calculating the registration fee and
based upon the average of the high and low prices of the common stock as
reported on the Nasdaq SmallCap Market on November 19, 1999.
--------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
<PAGE> 3
The information in this prospectus is not complete and may be changed without
notice. The selling stockholders may not sell these securities until the
registration statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these securities, and the
selling stockholders are not soliciting offers to buy these securities, in any
state where offer or sale of these securities is not permitted.
SUBJECT TO COMPLETION, DATED NOVEMBER 24, 1999
PROSPECTUS
1,471,919 Shares
[ESOFT, INC. LOGO]
ESOFT, INC.
Common Stock
--------------
The 1,471,919 shares of common stock, $.01 par value, offered hereby
are being offered by certain of our stockholders. See "Selling Stockholders."
Our common stock is listed and trading on the Nasdaq SmallCap Market
under the symbol "ESFT." The offering price of the common stock to be offered by
this Prospectus will be determined by the market price in effect from time to
time. See "Plan of Distribution."
--------------
THE SHARES OF COMMON STOCK OFFERED HEREBY INVOLVE A HIGH DEGREE OF
RISK.
--------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY
STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED
THESE SECURITIES, OR DETERMINED IF THIS PROSPECTUS IS
TRUTHFUL OR COMPLETE. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is November _______, 1999.
<PAGE> 4
YOU SHOULD RELY ONLY ON INFORMATION CONTAINED IN OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS. NEITHER WE NOR ANY OF THE SELLING STOCKHOLDERS
HAVE AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION. NEITHER WE NOR
ANY OF THE SELLING STOCKHOLDERS IS MAKING AN OFFER OF THESE SECURITIES IN ANY
STATE WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD NOT ASSUME THAT THE
INFORMATION PROVIDED BY THE PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE
DATE OF THE FRONT OF THIS PROSPECTUS.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
WHERE YOU CAN FIND MORE INFORMATION...............................................................................3
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE...................................................................3
SUMMARY...........................................................................................................5
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS...................................................................7
USE OF PROCEEDS...................................................................................................7
SELLING STOCKHOLDERS..............................................................................................8
DESCRIPTION OF eSOFT COMMON STOCK................................................................................10
PLAN OF DISTRIBUTION.............................................................................................11
VALIDITY OF SECURITIES...........................................................................................12
EXPERTS..........................................................................................................12
</TABLE>
-2-
<PAGE> 5
WHERE YOU CAN FIND MORE INFORMATION
eSoft files annual, quarterly and other reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any reports, statements or other information we file at the Securities and
Exchange Commission's public reference rooms in Washington, D.C., New York, New
York and Chicago, Illinois. Please call the Securities and Exchange Commission
at 1 (800) SEC-0330 for further information on the public reference rooms. Our
Securities and Exchange Commission filings are also available to the public from
commercial document retrieval services and at the web site maintained by the
Securities and Exchange Commission at "http://www.sec.gov."
We have filed a Registration Statement on Form S-3 to register with the
Securities and Exchange Commission the eSoft common stock offered by this
Prospectus. This Prospectus is part of that Registration Statement. As allowed
by Securities and Exchange Commission rules, this Prospectus does not contain
all the information you can find in the Registration Statement or the exhibits
to the Registration Statement.
You can obtain a complete copy of the Registration Statement, including
exhibits, without charge by submitting a request in writing or by telephone to
us at the following addresses:
Investor Relations
ESOFT, INC.
295 Interlocken Boulevard, Suite 500
Broomfield, Colorado 80021
(303) 444-1600
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" information filed with it, which means that we can disclose important
information to you by referring you directly to those documents. The information
incorporated by reference is considered to be a part of this prospectus. In
addition, information we file with the Commission in the future will
automatically update and supersede information contained in this prospectus and
any accompanying prospectus supplement. We are incorporating by reference the
documents listed below and any future filings made with the Commission under
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until
all of the shares of common stock described in this prospectus are sold:
- Annual Report on Form 10-KSB/A-1 for the fiscal year ended
December 31, 1998;
- Quarterly Report on Form 10-QSB for the fiscal quarter ended
March 31, 1999;
- Current Report on Form 8-K filed June 9, 1999;
- Current Report on Form 8-K filed June 28, 1999;
- Quarterly Report on Form 10-QSB filed June 30, 1999;
- Quarterly Report on Form 10-QSB filed November 15, 1999;
- Current Report on Form 8-K filed on August 9, 1999;
- Amended Current Report on Form 8-K/A filed on August 9, 1999.
- Current Report on Form 8-K filed on September 27, 1999;
- Amended Current Report on Form 8-K/A filed on November 17, 1999;
and
- Current Report on Form 8-K filed on November 24, 1999.
-3-
<PAGE> 6
You may request a copy of these filings at no cost, by writing us at
295 Interlocken Boulevard, Suite 500, Broomfield, Colorado 80021, Attention:
Director of Investor Relations or telephoning us at (303) 444-1600.
-4-
<PAGE> 7
SUMMARY
THE COMPANY
We develop and market a product line of Internet protocol adapters that
are designed to be a total Internet/Intranet connectivity solution for small and
medium sized businesses, institutions and educational sites that can be easily
and economically installed and managed by existing systems personnel.
We recently concluded strategic combinations with Apexx Technology,
Inc. and Technologic, Inc. that resulted in Apexx and Technologic becoming our
wholly owned subsidiaries. Apexx is an Idaho corporation that provides easy and
affordable computer networking solutions that enhance decision speed and
communication capabilities to growing organizations. Apexx's award-winning TEAM
Internet(R) family of products, targeted to small to medium sized businesses,
provides a turnkey Internet/Intranet solution that gives the customer a
powerful, affordable and easy to manage Internet presence. The key features
include Internet connectivity/routing, firewall protection, an e-mail server,
Web browsing, Web publishing capabilities and Web filtering applications.
Technologic is a leading developer of Internet firewall and all-in-one
connectivity appliances. Technologic's mission is to provide products and
services that make it affordable, easy and safe for companies to conduct
business on the Internet. Technologic's flagship products, Interceptor(TM)
Firewall Appliance and InstaGate(TM) Internet Appliances, have been certified to
meet security standards defined by the ICSA (International Computer Security
Association).
Our principal executive office is located at 295 Interlocken Boulevard,
Suite 500, Broomfield, Colorado 80021, and our telephone number is (303)
444-1600.
THE OFFERING
We are registering an aggregate of 1,471,919 shares of our common stock
to be offered for sale by certain of our stockholders. These shares are held or
issuable as follows:
<TABLE>
<S> <C>
Shares that are held by Technologic, Inc. stockholders 1,244,431
Shares that are held by certain Technologic, Inc. optionholders
who exercised their Technologic, Inc. options 24,693
Shares that are held by Edward S. Croft, III, Theodore Jackson
Bender, III, and Croft & Bender, LLC (collectively, "Croft and
Bender") 75,000
Shares that may be issued to AGE Investments, Inc. ("AGE") upon
exercise of outstanding warrants to purchase eSoft common stock
issued to AGE for investment banking services rendered, at an
exercise price of $3.96875 per share 127,795
---------
Total: 1,471,919
=========
</TABLE>
-5-
<PAGE> 8
The Technologic, Inc. stockholders, optionholders, Croft and Bender,
and AGE shall hereinafter be referred to as the "Selling Stockholders." We will
not receive any of the proceeds from the sale of eSoft common stock by the
Selling Stockholders. If all of the warrants described above are exercised at
their current exercise price, we will receive approximately $507,186 from the
purchase of eSoft common stock pursuant to the warrants.
-6-
<PAGE> 9
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
We have made certain forward-looking statements in this document and in
the documents referred to in this document that are subject to risks and
uncertainties. These statements are based on the beliefs and assumptions of our
management and on the information currently available to our management.
Forward-looking statements include information concerning our possible or
assumed future results. These statements may be preceded by, followed by, or
otherwise include the words "believes," "expects," "anticipates," "intends,"
"plans," "estimates" or similar expressions.
Forward-looking statements are not guarantees of performance. They
involve risks, uncertainties and assumptions. Our future results and stockholder
values may differ materially from those expressed in these forward-looking
statements. Many of the factors that will determine these results and values are
beyond our ability to control or predict. Investors are cautioned not to put
undue reliance on any forward-looking statements. Except for their ongoing
obligations to disclose material information as required by the federal
securities law, we do not have any intention or obligation to update
forward-looking statements after they distribute this Prospectus, even if new
information, future events or other circumstances have made them incorrect or
misleading. For those statements, we claims the protection of the safe harbor
for forward-looking statements contained in the Private Securities Litigation
Reform Act of 1995.
You should understand that various factors, in addition to those
discussed elsewhere in this document and in the documents referred to in this
document, could affect our future results and could cause results to differ
materially from those expressed in such forward-looking statements. For a
discussion of certain of these important factors, see "Risk Factors Relating to
an Investment in eSoft Common Stock," contained in the reports we file with the
Securities and Exchange Commission.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of eSoft common
stock by the Selling Stockholders. If all of the warrants described below are
exercised at their current exercise prices, we will receive approximately
$507,186 from the purchase of common stock pursuant to the warrants. See
"Summary--The Offering."
-7-
<PAGE> 10
SELLING STOCKHOLDERS
The following table sets forth certain information regarding beneficial
ownership of eSoft common stock as of October 31, 1999 by the Selling
Stockholders in this offering.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY SHARES BENEFICIALLY
OWNED PRIOR TO THIS OFFERING OWNED AFTER THIS OFFERING
---------------------------- ---------------------------
SHARES OFFERED
PERCENT OF IN THIS PERCENT OF
NAME AND ADDRESS NUMBER OUTSTANDING OFFERING NUMBER OUTSTANDING(1)
---------------- ------ ----------- -------------- ------ --------------
<S> <C> <C> <C> <C> <C>
AGE Investments, Inc.(2).......... 127,795 1.0% 127,795 -0- -0-
One North Jefferson
St. Louis, Missouri 63103
John R. Adams..................... 27,424 * 27,424 -0- -0-
811 Brandon Park Place NW
Atlanta, GA 30318-1673
Theodore Jackson Bender, III...... 30,000 * 30,000 -0- -0-
3541 Ridgewood Road, NW
Atlanta, GA 30327
Eric S. Bleke..................... 205,782 1.6% 205,782 -0- -0-
3150 Verdun Drive, NW
Atlanta, GA 30305
Brian E. Cohen.................... 342,951 2.6% 342,951 -0- -0-
2827 Spalding Drive
Dunwoody, GA 30350
Croft & Bender, LLC............... 15,000 * 15,000 -0- -0-
4200 Northside Parkway, NW
Bldg 7-A
Atlanta, GA 30327
Edward S. Croft, III.............. 30,000 * 30,000 -0- -0-
500 Argonne Drive, NW
Atlanta, GA 30305
Robin K. Cutshaw.................. 45,727 * 45,727 -0- -0-
773 Cumberland Road
Atlanta, GA 30306
Perry B. Flinn.................... 228,639 1.7% 228,639 -0- -0-
175 Abington Drive
Atlanta, GA 30328
Nicholas Hammand.................. 27,424 * 27,424 -0- -0-
211 E. Wesley Road
Atlanta, GA 30305
Margaret Harris................... 3,087 * 3,087 -0- -0-
4925 Cold Springs Drive
Wilburn, GA 30047
Steven M. Kramer.................. 106,302 * 106,302 -0- -0-
9815 Buice Road
Alpharetta, GA 30022-6324
Michael C. McChesney.............. 165,981 1.3% 165,981 -0- -0-
37 Muscogee Avenue
Atlanta, GA 30305
</TABLE>
-8-
<PAGE> 11
<TABLE>
<CAPTION>
SHARES BENEFICIALLY SHARES BENEFICIALLY
OWNED PRIOR TO THIS OFFERING OWNED AFTER THIS OFFERING
---------------------------- ---------------------------
SHARES OFFERED
PERCENT OF IN THIS PERCENT OF
NAME AND ADDRESS NUMBER OUTSTANDING OFFERING NUMBER OUTSTANDING(1)
---------------- ------ ----------- -------------- ------ --------------
<S> <C> <C> <C> <C> <C>
Ferrell Moultrie.................. 13,704 * 13,704 -0- -0-
4243 Cutter Court
Roswell, GA 30075
Cameron Pecego.................... 6,173 * 6,173 -0- -0-
1036 Johnson Lane
Minden, NV 89423
King Rhotan....................... 15,433 * 15,433 -0- -0-
834 38th Avenue
San Francisco, CA 94121
Ken "Dutch" Schultz............... 34,724 * 34,724 -0- -0-
205 Waverly Hall Place
Roswell, GA 30075
Charles T. Watt................... 41,144 * 41,144 -0- -0-
1909 Acuba Lane
Atlanta, GA 30345
Marc Winn......................... 4,629 * 4,629 -0- -0-
1032 Cumberland Road
Atlanta, GA 30306
--------- ---------
Total .................... 1,471,919 1,471,919
</TABLE>
- --------------------------
* Less than 1%.
(1) For purposes of calculating shares beneficially owned after this offering,
it is assumed that all shares offered hereunder that are purchasable upon
the exercise of warrants have been purchased by the Selling Stockholder
upon exercise of its warrants and that such shares have been sold pursuant
to this offering.
(2) Consists of warrants to purchase eSoft common stock.
Brian E. Cohen, the former Chief Executive Officer of Technologic Inc., is
the Vice President of Strategic Relations and a director of eSoft as of
September 10, 1999. Perry B. Flinn, a former executive officer of
Technologic, Inc. is Vice President of Technology of eSoft as of September
10, 1999.
-9-
<PAGE> 12
DESCRIPTION OF ESOFT COMMON STOCK
The following is a summary description of our common stock. Investors
are urged to review our certificate of incorporation, as amended to date, which
has been filed as an exhibit to a registration statement filed with the
Securities and Exchange Commission.
GENERAL
We are authorized to issue 50,000,000 shares of common stock and
5,000,000 shares of preferred stock. The holders of eSoft common stock are
entitled to vote at all meetings of stockholders, to receive dividends if, as,
and when declared by the board of directors, and to participate in any
distribution of property or assets on the liquidation, winding up, or other
dissolution of eSoft. eSoft common stock has no preemptive or conversion rights.
CHANGE IN CONTROL PROVISIONS OF THE CERTIFICATE OF INCORPORATION AND BYLAWS
Certain provisions of our Amended and Restated Certificate of
Incorporation and Bylaws may make it difficult to change control of eSoft.
Article 4 of the Amended and Restated Certificate of Incorporation allows our
board of directors to determine or alter the rights, preferences, privileges,
and restrictions to be granted to or imposed upon any wholly unissued series of
preferred stock, to fix the number of shares that constitute any series of
preferred stock, and to determine the designation and series of preferred stock.
Article III of the Bylaws establishes what is known as a "classified board of
directors," with three classes of directors designated as Class I, Class II, and
Class III. Each class is elected to serve for a three year term, with each class
up for election in different years so that in any one year, only one-third of
all directors are up for election. At each annual meeting of stockholders, the
successors to the class of directors whose terms expire at that meeting are
elected to serve as directors for a three year term.
MARKET PRICE OF ESOFT COMMON STOCK
On March 16, 1998, eSoft completed a public offering of its common
stock in Canada on the Vancouver Stock Exchange. On August 6, 1998, eSoft's
stock began trading on the Nasdaq SmallCap Market under the symbol "ESFT." eSoft
delisted from the Vancouver Stock Exchange on September 9, 1998.
The range of high and low bid quotations for eSoft common stock as
quoted (without retail markup or markdown and without commissions) on the Nasdaq
SmallCap Market and the Vancouver Stock Exchange for the past fiscal year and
the current fiscal year to date is provided below. The figures shown below do
not necessarily represent actual transactions:
<TABLE>
<CAPTION>
HIGH LOW
------ -----
<S> <C> <C>
1999
Fourth Quarter (through November 19, 1999) $20.31 $3.00
Third Quarter $6.13 $2.63
Second Quarter $4.75 $2.13
First Quarter $6.00 $2.75
1998
Fourth Quarter $7.50 $2.13
Third Quarter $8.00 $2.88
Second Quarter $5.35 $4.25
First Quarter $9.00 $4.95
</TABLE>
-10-
<PAGE> 13
There are approximately 150 record holders of eSoft common stock. The
transfer agent for the eSoft common stock is The Trust Company of the Bank of
Montreal with offices at First Bank Tower 6th Floor, 595 Burrard Street,
Vancouver, B.C. V7X1L7.
DIVIDENDS
We intend, for the foreseeable future, to retain all earnings, if any,
for the development of our business opportunities. The payment of future
dividends will be at the discretion of our board of directors and will depend
upon, among other things, future earnings, capital requirements, our financial
condition and general business conditions.
PLAN OF DISTRIBUTION
We are registering an aggregate of 1,471,919 shares of eSoft common
stock (the "Shares") on behalf of the Selling Stockholders. As used herein, the
term Selling Stockholders means the holder of the Shares and includes donees and
pledgees selling Shares received from a named Selling Stockholder after the date
of this Prospectus. All costs, expenses and fees in connection with the
registration of the Shares offered hereby will be borne by us. Brokerage
commissions and similar selling expenses, if any, attributable to the sale of
Shares will be borne by the Selling Stockholders. Sales of Shares may be
effected by Selling Stockholders from time to time in one or more types of
transactions (which may include block transactions) on Nasdaq, in the
over-the-counter market, in negotiated transactions, through put or call options
transactions relating to the Shares, through short sales of Shares, or a
combination of such methods of sale, at market prices prevailing at the time of
sale, or at negotiated prices. Such transactions may or may not involve brokers
or dealers. The Selling Stockholders have advised us that they have not entered
into any agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their Shares, nor is there an underwriter
or coordinated broker acting in connection with the proposed sale of Shares by
the Selling Stockholders.
The Selling Stockholders may enter into hedging transactions with
broker-dealers or other financial institutions. In connection with such
transactions, broker-dealers or other financial institutions may engage in short
sales of the Shares or of securities convertible into or exchangeable for the
Shares in the course of hedging positions they assume with the Selling
Stockholders. The Selling Stockholders may also enter into options or other
transactions with broker-dealers or other financial institutions which require
the delivery to such broker-dealers or other financial institutions of Shares
offered by this Prospectus, which Shares such broker-dealer or other financial
institution may resell pursuant to this Prospectus (as amended or supplemented
to reflect such transaction).
The Selling Stockholders may effect such transactions by selling Shares
directly to purchasers or to or through broker-dealers, which may act as agents
or principals. Such broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the Selling Stockholders and/or the
purchasers of Shares for whom such broker-dealers may act as agents or to whom
they sell as principal, or both (which compensation as to a particular
broker-dealer might be in excess of customary commissions).
-11-
<PAGE> 14
The Selling Stockholders and any broker-dealers that act in connection
with the sale of Shares might be deemed to be "underwriters" within the meaning
of Section 2(11) of the Securities Act, and any commissions received by such
broker-dealers and any profit on the resale of the Shares sold by them while
acting as principals might be deemed to be underwriting discounts or commissions
under the Securities Act. We have agreed to indemnify each Selling Stockholder
against certain liabilities, including liabilities arising under the Securities
Act. The Selling Stockholders may agree to indemnify any agent, dealer or
broker-dealer that participates in transactions involving sales of the Shares
against certain liabilities, including liabilities arising under the Securities
Act.
The Selling Stockholders will be subject to the prospectus delivery
requirements of the Securities Act. We have informed the Selling Stockholders
that the anti-manipulative provisions of Regulation M promulgated under the
Exchange Act may apply to their sales in the market.
The Selling Stockholders also may resell all or a portion of the Shares
in open market transactions in reliance upon Rule 144 under the Securities Act,
provided they meet the criteria and conform to the requirements of such Rule.
If a Selling Stockholder notifies us that any material arrangement has
been entered into with a broker-dealer for the sale of Shares through a block
trade, special offering, exchange distribution or secondary distribution or a
purchase by a broker or dealer, a supplement to this Prospectus will be filed,
if required, pursuant to Rule 424(b) under the Securities Act, disclosing (i)
the name of each such Selling Stockholder and of the participating
broker-dealer(s), (ii) the number of Shares involved, (iii) the initial price at
which such Shares were sold, (iv) the commissions paid or discounts or
concessions allowed to such broker-dealer(s), where applicable, (v) that such
broker-dealer(s) did not conduct any investigation to verify the information set
out or incorporated by reference in this Prospectus and (vi) other facts
material to the transactions. In addition, if a Selling Stockholder notifies us
that a donee or pledgee intends to sell more than 500 Shares, a supplement to
this Prospectus will be filed.
VALIDITY OF SECURITIES
Davis, Graham & Stubbs LLP, one of our law firms, will issue an
opinion about the legality of the securities offered hereby.
EXPERTS
The financial statements of eSoft, Inc. incorporated by reference in
this Prospectus have been audited by BDO Seidman, LLP, independent certified
public accountants, to the extent and for the periods set forth in their reports
incorporated herein by reference, and are incorporated by reference herein in
reliance upon such reports given upon the authority of said firm as experts in
auditing and accounting.
The financial statements of Appexx Technology, Inc. for the years ended
December 31, 1997 and 1998, have been audited by Balukoff, Lindstrom & Co.,
P.A., Certified Public Accountants, as set forth in its report attached thereto.
The financial statements referred to above are incorporated herein by reference
in reliance upon such authority of such firm as experts in auditing and
accounting.
The financial statements of Technologic, Inc. incorporated by reference
in this Prospectus have been audited by BDO Seidman, LLP, independent certified
public accountants, to the extent and for the periods set forth in their report
incorporated herein by reference, and are incorporated by reference herein in
reliance upon such report given upon the authority of said firm as experts in
auditing and accounting.
-12-
<PAGE> 15
PART II
INFORMATION NOT REQUIRED
IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, payable by eSoft
in connection with the sale of Common Stock being registered (all amounts are
estimated except the Commission Registration Fee).
<TABLE>
<S> <C>
Commission Registration Fee........................................................ $6,035
Blue Sky Qualification Fees and Expenses (including legal fees) (estimated)........ 6,000
Printing Expenses (estimated)...................................................... 1,000
Legal Fees and Expenses (estimated)................................................ 10,000
Accountants' Fees and Expenses (estimated)......................................... 10,000
Miscellaneous Expenses (estimated)................................................. 6,965
-------
Total $40,000
</TABLE>
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS
eSoft is incorporated in the state of Delaware. Section 145 of the
General Corporation Law of the State of Delaware contains provisions permitting
corporations organized thereunder to indemnify directors, officers and other
representatives from liabilities in connection with any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that such person was or is a director,
officer, employee or agent of the corporation, against liabilities arising in
any such action, suit or proceeding, expenses incurred in connection therewith,
and against certain other liabilities.
Article 8 of the Certificate of Incorporation of eSoft provides that,
to the furthest extent permitted by applicable law in effect from time to time,
no director of eSoft shall have any personal liability for monetary damages to
eSoft or its stockholders for breach of his fiduciary duty as a director, except
that indemnity is not provided to a director whose conduct involves (i) a breach
of the director's duty of loyalty to eSoft or its stockholders, (ii) acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of the law, (iii) unlawful distributions as defined in Section 174 of
the Delaware General Corporation Law, and (iv) any transaction from which the
director derived an improper personal benefit.
Article 9 of the Certificate of Incorporation and the Bylaws of eSoft
provide similar indemnification provisions as that provided by Section 145 of
the General Corporation Law of the state of Delaware. eSoft will also indemnify
any person who is serving or has served eSoft as an officer to the same extent
as a director.
II-1
<PAGE> 16
ITEM 16. EXHIBITS AND FINANCIAL STATEMENTS SCHEDULES
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
<S> <C>
2.1 Amended and Restated Agreement and Plan Merger dated January 25,
1999 between eSoft, Inc., eSoft Acquisition Corporation and Apexx
Technology, Inc. (filed with Registration Statement on Form S-4 on
March 19, 1999 and incorporated herein by reference).
2.2 Form of Stockholders Agreement to be executed by Apexx Technology,
Inc. stockholders in connection with the merger (filed with
Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
2.3 Form of Escrow Agreement to be executed by eSoft, Inc. Thomas
Loutzenheiser and The Trust Company of The Bank of Montreal (filed
with Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
2.4 Employment Agreement by and between eSoft, Inc. and Thomas
Loutzenheiser (filed with Registration Statement on Form S-4 on
March 19, 1999 and incorporated herein by reference).
3.1 Certificate of Incorporation of New eSoft, Inc. (filed with Amendment
No. 1 to Registration Statement on Form 10-SB on February 18, 1998
and incorporated herein by reference).
3.2 Amendment to Certificate of Incorporation of eSoft, Inc. (filed with
Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
3.3 Bylaws of eSoft (filed with Registration Statement on Form S-B on
June 7, 1998 and incorporated herein by reference).
4.1 Form of Common Stock Certificate of eSoft (filed with Registration
Statement on Form 10-SB on December 22, 1997 and incorporated herein
by reference).
4.2 Form of 5% Convertible Subordinated Debenture (filed with Current
Report on Form 8-K on June 28, 1999 and incorporated herein by
reference).
5.1* Opinion of Davis, Graham & Stubbs LLP (including consent)
10.1 Severance Agreement and Mutual Release dated December 19, 1997
between eSoft and Wayne Farlow (filed with Registration Statement on
Form 10-SB on December 22, 1997 and incorporated herein by
reference).
10.2 Agency Agreement with C.M. Oliver Capital (filed with Amendment
No. 1 to Registration Statement on Form SB-2, filed March 24, 1998
and incorporated herein by reference).
10.3 Agent's Warrant (filed with Amendment No. 1 to Registration
Statement on Form SB-2, filed March 24, 1998 and incorporated herein
by reference).
10.4 Lease Agreement dated September 18, 1997 between eSoft and Aspen
Industrial Park Partnership (filed with Registration Statement on
Form SB-2 on December 24, 1997 and incorporated herein by
reference).
10.5 Voting Agreement dated September 2, 1997 between Philip Becker,
Pantheon Capital Ltd. And Transition Partners, Ltd. (filed with
Registration Statement on Form 10-SB on December 22, 1997 and
incorporated herein by reference).
10.6 Termination Agreement (filed with Amendment No. 1 to Registration
Statement on Form 10-SB on February 18, 1998 and incorporated herein
by reference).
10.7 Registration Rights Agreement dated September 2, 1997 between
Transition Partners, Ltd., Pantheon Capital Ltd. and eSoft (filed
with Registration Statement on Form 10-SB on December 22, 1997 and
incorporated herein by reference).
10.8 Agreement dated May 6, 1997 between Transition Partners, Ltd. and
eSoft (filed with Registration Statement on Form 10-SB on December
22, 1997 and incorporated herein by reference).
10.9 Agreement dated October 14, 1996 between Transition Partners, Ltd.
and eSoft (filed with Registration Statement on Form 10-SB on
December 22, 1997 and incorporated herein by reference).
10.10 Amendment to Agreement dated August 22, 1997 between Transition
Partners, Ltd. and eSoft (filed with Registration Statement on Form
10-SB on December 22, 1997 and incorporated herein by reference).
</TABLE>
II-2
<PAGE> 17
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
<S> <C>
10.11 Second Amendment to Agreement dated November 11, 1997 between
Transition Partners, Ltd. and eSoft (filed with Registration
Statement on Form 10-SB on December 22, 1997 and incorporated herein
by reference).
10.12 Stock Option Agreement dated November 11, 1997 between Transition
Partners, Ltd. and eSoft (filed with Registration Statement on Form
10-SB on December 22, 1997 and incorporated herein by reference).
10.13 Amended Stock Warrant Agreement dated January 29, 1998 (filed with
Amendment No. 1 to Registration Statement on Form 10-SB on February
18, 1998 and incorporated herein by reference).
10.14 Consulting Agreement dated August 1, 1997 between eSoft and Kent
Nuzum (filed with Registration Statement on Form 10-SB on December
22, 1997 and incorporated herein by reference).
10.15 Consulting Agreement dated August 22, 1997 between Pantheon Capital
Ltd. and eSoft (filed with Registration Statement on Form 10-SB on
December 22, 1997 and incorporated herein by reference).
10.16 Amendment to Consulting Agreement dated August 22, 1997 between
Pantheon Capital Ltd. and eSoft (filed with Registration Statement
on Form 10-SB on December 22, 1997 and incorporated herein by
reference).
10.17 Stock Option Agreement dated November 11, 1997 between Pantheon
Capital Ltd. and eSoft (filed with Registration Statement on Form
10-SB on December 22, 1997 and incorporated herein by reference).
10.18 Amended Stock Warrant Agreement dated January 29, 1998 (filed with
Amendment No. 1 to Registration Statement on Form 10-SB on February
18, 1998 and incorporated herein by reference).
10.19 Stock Option Agreement dated November 11, 1997 between Copeland
Consulting Group, Inc. and eSoft (filed with Registration Statement
on Form 10-SB on December 22, 1997 and incorporated herein by
reference).
10.20 Amended Stock Warrant Agreement dated January 29, 1998 (filed with
Amendment No. 1 to Registration Statement on Form 10-SB on February
18, 1998 and incorporated herein by reference).
10.21 Employment Agreement dated September 2, 1997 between Philip Becker
and eSoft (filed with Registration Statement on Form 10-SB on
December 22, 1997 and incorporated herein by reference).
10.22 Form of Employee Confidentiality Agreement (filed with Amendment
No. 1 to Registration Statement on Form 10-SB on February 18, 1998
and incorporated herein by reference).
10.23 Termination Agreement terminating Software Development and
Consulting Agreements (filed with Amendment No. 1 to Registration
Statement on Form 10-SB on February 18, 1998 and incorporated herein
by reference).
10.24 Promissory Note to First National Bank of Arvada, Colorado (filed
with Amendment No. 1 to Registration Statement on Form 10-SB on
February 18, 1998 and incorporated herein by reference).
10.25 Proposal for financing arrangement from Colorado National Bank
(filed with Amendment No. 1 to Registration Statement on Form 10-SB
on February 18, 1998 and incorporated herein by reference).
10.26 Employment Agreement dated March 6, 1998 between Regis Frank and
eSoft (filed with Amendment No. 1 to Registration Statement on Form
SB-2, filed March 24, 1998 and incorporated herein by reference).
10.27 Employment Agreement dated March 6, 1998 between Robert C. Hartman
and eSoft (filed with Amendment No. 1 to Registration Statement on
Form SB-2, filed March 24, 1998 and incorporated herein by
reference).
10.28 Employment Letter dated October 7, 1997 between Jason M. Rollings
and eSoft (filed with Amendment No. 2 to Registration Statement on
Form SB-2, filed April 17, 1998 and incorporated herein by
reference).
10.29 Employment Letter dated October 7, 1997 between Jason M. Rollings
and eSoft (filed with Amendment No. 2 to Registration Statement on
Form SB-2, filed April 17, 1998 and incorporated herein by
reference).
10.30 Employment Agreement between Thomas R. Tennessen and eSoft (filed
with Amendment No. 2 to Registration Statement on Form SB-2, filed
April 17, 1998 and incorporated herein by reference).
10.31 Employment Agreement between Thomas R. Tennessen and eSoft (filed
with Registration Statement on Form SB-2 on August 19, 1998 and
incorporated herein by reference).
</TABLE>
II-3
<PAGE> 18
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
<S> <C>
10.32 Employment Agreement between James R. Bell and eSoft (filed with
Registration Statement on Form SB-2 on August 19, 1998 and
incorporated herein by reference).
10.33 Employment Letter between James M. Love and eSoft (filed with
Registration Statement on Form SB-2 on August 19, 1998 and
incorporated herein by reference).
10.34 Consulting Retainer Agreement (filed with Registration Statement on
Form SB-2 on August 19, 1998 and incorporated herein by reference).
10.35 Form of Distributor Agreement (filed with Registration Statement on
Form SB-2 on August 19, 1998 and incorporated herein by reference).
10.36 Employment Agreement between Jeffrey Finn and eSoft (filed with
Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
10.37 Employment Agreement between Jane Merickel and eSoft (filed with
Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
10.38 Employment Agreement between Steve Kuzara and eSoft (filed with
Amendment No. 1 to Registration Statement on Form S-4 on April 20,
1999 and incorporated herein by reference).
10.39 Securities Purchase Agreement dated as of June 10, 1999 (filed with
Current Report on Form 8-K on June 28, 1999 and incorporated herein
by reference).
10.40 Registration Rights Agreement dated as of June 10, 1999 (filed with
Current Report on Form 8-K on June 28, 1999 and incorporated herein
by reference).
10.41 Form of Warrant relating to purchase of 5% Convertible Subordinated
Debenture (filed with Current Report on Form 8-K on June 28, 1999
and incorporated herein by reference).
10.42 Agreement and Plan of Merger between eSoft, Inc., eSoft Acquisition
Corporation, and Technologic, Inc. dated as of September 10, 1999
(filed with the Current Report on Form 8-K on September 27, 1999 and
incorporated herein by reference).
10.43 Stockholders Agreement dated as of September 10, 1999 (filed with
Current Report on Form 8-K on September 27, 1999 and incorporated
herein by reference).
10.44 Escrow Agreement dated as of September 10, 1999 (filed with Current
Report on Form 8-K on September 27, 1999 and incorporated herein by
reference).
23.1* Consents of BDO Seidman, LLP
23.2* Consent of Balukoff, Lindstrom & Co., P.A.
</TABLE>
- -----------------------
* Filed herewith
II-4
<PAGE> 19
ITEM 17. UNDERTAKINGS
The Registrant hereby undertakes that, for the purposes of determining
any liability under the Securities Act of 1933, each filing of the Registrant's
annual report pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in this Registration Statement shall be
deemed to be a new Registration Statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement:
(i) to include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the
total dollar of securities offered would not exceed
that which was registered) and any deviation from the
low or high end of the estimated maximum offering
range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum
aggregate offering price set forth in the
"Calculation of Registration Fee" table in the
effective registration statement; and
(iii) to include any material information with respect to
the plan of distribution not previously disclosed in
the Registration Statement or any material change to
such information in the Registration Statement,
provided, however, that paragraphs (a)(i) and (a)(ii) do not
apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of 1934,
that are incorporated by reference in the Registration
Statement;
(b) That for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new Registration Statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
II-5
<PAGE> 20
such indemnification is against public policy as expressed in the Securities Act
of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses is incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
II-6
<PAGE> 21
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Broomfield, Colorado on the 22nd day of
November, 1999.
eSOFT, INC.
By: /s/ Jeffrey Finn
------------------------------------
Name: Jeffrey Finn
Title: President and Chief Executive
Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears herein constitutes and appoints Jeffrey Finn and Sara Kraeski,
and each of them, as his true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for him and in his name, place and
stated, in any and all capacities, to sign any and all amendments to this
Registration Statement (including post-effective amendments), including a
registration statement filed pursuant to Rule 462(b) under the Securities Act of
1933, as amended, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents, and each of them, full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in connection therewith, as fully as to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or any of them, or their or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
---------- ----- ----
<S> <C> <C>
/s/ Philip Becker Chairman of the Board, Chief Technical November 22, 1999
- ---------------------------------- Officer
Philip Becker
/s/ Jeffrey Finn Director, President and Chief Executive November 22, 1999
- ---------------------------------- Officer (Principal Executive Officer)
Jeffrey Finn
/s/ Amy Beth Hansman Principal Accounting Officer November 22, 1999
- ----------------------------------
Amy Beth Hansman
/s/ Richard Eyestone Director November 22, 1999
- ----------------------------------
Richard Eyestone
</TABLE>
II-7
<PAGE> 22
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
---------- ----- ----
<S> <C> <C>
/s/ Brian E. Cohen Director November 22, 1999
- ----------------------------------
Brian E. Cohen
Director November 22, 1999
- ----------------------------------
Richard Rice
Director November 22, 1999
- ----------------------------------
Fred Frank
</TABLE>
II-8
<PAGE> 23
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
<S> <C>
2.1 Amended and Restated Agreement and Plan Merger dated January 25,
1999 between eSoft, Inc., eSoft Acquisition Corporation and Apexx
Technology, Inc. (filed with Registration Statement on Form S-4 on
March 19, 1999 and incorporated herein by reference).
2.2 Form of Stockholders Agreement to be executed by Apexx Technology,
Inc. stockholders in connection with the merger (filed with
Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
2.3 Form of Escrow Agreement to be executed by eSoft, Inc. Thomas
Loutzenheiser and The Trust Company of The Bank of Montreal (filed
with Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
2.4 Employment Agreement by and between eSoft, Inc. and Thomas
Loutzenheiser (filed with Registration Statement on Form S-4 on
March 19, 1999 and incorporated herein by reference).
3.1 Certificate of Incorporation of New eSoft, Inc. (filed with Amendment
No. 1 to Registration Statement on Form 10-SB on February 18, 1998
and incorporated herein by reference).
3.2 Amendment to Certificate of Incorporation of eSoft, Inc. (filed with
Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
3.3 Bylaws of eSoft (filed with Registration Statement on Form S-B on
June 7, 1998 and incorporated herein by reference).
4.1 Form of Common Stock Certificate of eSoft (filed with Registration
Statement on Form 10-SB on December 22, 1997 and incorporated herein
by reference).
4.2 Form of 5% Convertible Subordinated Debenture (filed with Current
Report on Form 8-K on June 28, 1999 and incorporated herein by reference).
5.1* Opinion of Davis, Graham & Stubbs LLP (including consent)
10.1 Severance Agreement and Mutual Release dated December 19, 1997
between eSoft and Wayne Farlow (filed with Registration Statement on
Form 10-SB on December 22, 1997 and incorporated herein by
reference).
10.2 Agency Agreement with C.M. Oliver Capital (filed with Amendment
No. 1 to Registration Statement on Form SB-2, filed March 24, 1998
and incorporated herein by reference).
10.3 Agent's Warrant (filed with Amendment No. 1 to Registration Statement
on Form SB-2, filed March 24, 1998 and incorporated herein by reference).
10.4 Lease Agreement dated September 18, 1997 between eSoft and Aspen
Industrial Park Partnership (filed with Registration Statement on
Form SB-2 on December 24, 1997 and incorporated herein by
reference).
10.5 Voting Agreement dated September 2, 1997 between Philip Becker,
Pantheon Capital Ltd. And Transition Partners, Ltd. (filed with
Registration Statement on Form 10-SB on December 22, 1997 and
incorporated herein by reference).
10.6 Termination Agreement (filed with Amendment No. 1 to Registration
Statement on Form 10-SB on February 18, 1998 and incorporated herein
by reference).
10.7 Registration Rights Agreement dated September 2, 1997 between
Transition Partners, Ltd., Pantheon Capital Ltd. and eSoft (filed
with Registration Statement on Form 10-SB on December 22, 1997 and
incorporated herein by reference).
10.8 Agreement dated May 6, 1997 between Transition Partners, Ltd. and
eSoft (filed with Registration Statement on Form 10-SB on December
22, 1997 and incorporated herein by reference).
</TABLE>
II-9
<PAGE> 24
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
<S> <C>
10.9 Agreement dated October 14, 1996 between Transition Partners, Ltd.
and eSoft (filed with Registration Statement on Form 10-SB on
December 22, 1997 and incorporated herein by reference).
10.10 Amendment to Agreement dated August 22, 1997 between Transition
Partners, Ltd. and eSoft (filed with Registration Statement on Form
10-SB on December 22, 1997 and incorporated herein by reference).
10.11 Second Amendment to Agreement dated November 11, 1997 between
Transition Partners, Ltd. and eSoft (filed with Registration
Statement on Form 10-SB on December 22, 1997 and incorporated herein
by reference).
10.12 Stock Option Agreement dated November 11, 1997 between Transition
Partners, Ltd. and eSoft (filed with Registration Statement on Form
10-SB on December 22, 1997 and incorporated herein by reference).
10.13 Amended Stock Warrant Agreement dated January 29, 1998 (filed with
Amendment No. 1 to Registration Statement on Form 10-SB on February
18, 1998 and incorporated herein by reference).
10.14 Consulting Agreement dated August 1, 1997 between eSoft and Kent
Nuzum (filed with Registration Statement on Form 10-SB on December
22, 1997 and incorporated herein by reference).
10.15 Consulting Agreement dated August 22, 1997 between Pantheon Capital
Ltd. and eSoft (filed with Registration Statement on Form 10-SB on
December 22, 1997 and incorporated herein by reference).
10.16 Amendment to Consulting Agreement dated August 22, 1997 between
Pantheon Capital Ltd. and eSoft (filed with Registration Statement
on Form 10-SB on December 22, 1997 and incorporated herein by
reference).
10.17 Stock Option Agreement dated November 11, 1997 between Pantheon
Capital Ltd. and eSoft (filed with Registration Statement on Form
10-SB on December 22, 1997 and incorporated herein by reference).
10.18 Amended Stock Warrant Agreement dated January 29, 1998 (filed with
Amendment No. 1 to Registration Statement on Form 10-SB on February
18, 1998 and incorporated herein by reference).
10.19 Stock Option Agreement dated November 11, 1997 between Copeland
Consulting Group, Inc. and eSoft (filed with Registration Statement
on Form 10-SB on December 22, 1997 and incorporated herein by
reference).
10.20 Amended Stock Warrant Agreement dated January 29, 1998 (filed with
Amendment No. 1 to Registration Statement on Form 10-SB on February
18, 1998 and incorporated herein by reference).
10.21 Employment Agreement dated September 2, 1997 between Philip Becker
and eSoft (filed with Registration Statement on Form 10-SB on
December 22, 1997 and incorporated herein by reference).
10.22 Form of Employee Confidentiality Agreement (filed with Amendment
No. 1 to Registration Statement on Form 10-SB on February 18, 1998
and incorporated herein by reference).
10.23 Termination Agreement terminating Software Development and
Consulting Agreements (filed with Amendment No. 1 to Registration
Statement on Form 10-SB on February 18, 1998 and incorporated herein
by reference).
10.24 Promissory Note to First National Bank of Arvada, Colorado (filed
with Amendment No. 1 to Registration Statement on Form 10-SB on
February 18, 1998 and incorporated herein by reference).
10.25 Proposal for financing arrangement from Colorado National Bank
(filed with Amendment No. 1 to Registration Statement on Form 10-SB
on February 18, 1998 and incorporated herein by reference).
10.26 Employment Agreement dated March 6, 1998 between Regis Frank and
eSoft (filed with Amendment No. 1 to Registration Statement on Form
SB-2, filed March 24, 1998 and incorporated herein by reference).
10.27 Employment Agreement dated March 6, 1998 between Robert C. Hartman
and eSoft (filed with Amendment No. 1 to Registration Statement on
Form SB-2, filed March 24, 1998 and incorporated herein by
reference).
10.28 Employment Letter dated October 7, 1997 between Jason M. Rollings
and eSoft (filed with Amendment No. 2 to Registration Statement on
Form SB-2, filed April 17, 1998 and incorporated herein by
reference).
</TABLE>
II-10
<PAGE> 25
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
<S> <C>
10.29 Employment Letter dated October 7, 1997 between Jason M. Rollings
and eSoft (filed with Amendment No. 2 to Registration Statement on
Form SB-2, filed April 17, 1998 and incorporated herein by
reference).
10.30 Employment Agreement between Thomas R. Tennessen and eSoft (filed
with Amendment No. 2 to Registration Statement on Form SB-2, filed
April 17, 1998 and incorporated herein by reference).
10.31 Employment Agreement between Thomas R. Tennessen and eSoft (filed
with Registration Statement on Form SB-2 on August 19, 1998 and
incorporated herein by reference).
10.32 Employment Agreement between James R. Bell and eSoft (filed with
Registration Statement on Form SB-2 on August 19, 1998 and
incorporated herein by reference).
10.33 Employment Letter between James M. Love and eSoft (filed with
Registration Statement on Form SB-2 on August 19, 1998 and
incorporated herein by reference).
10.34 Consulting Retainer Agreement (filed with Registration Statement on
Form SB-2 on August 19, 1998 and incorporated herein by reference).
10.35 Form of Distributor Agreement (filed with Registration Statement on
Form SB-2 on August 19, 1998 and incorporated herein by reference).
10.36 Employment Agreement between Jeffrey Finn and eSoft (filed with
Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
10.37 Employment Agreement between Jane Merickel and eSoft (filed with
Registration Statement on Form S-4 on March 19, 1999 and
incorporated herein by reference).
10.38 Employment Agreement between Steve Kuzara and eSoft (filed with
Amendment No. 1 to Registration Statement on Form S-4 on April 20,
1999 and incorporated herein by reference).
10.39 Securities Purchase Agreement dated as of June 10, 1999 (filed with
Current Report on Form 8-K on June 28, 1999 and incorporated herein
by reference).
10.40 Registration Rights Agreement dated as of June 10, 1999 (filed with
Current Report on Form 8-K on June 28, 1999 and incorporated herein
by reference).
10.41 Form of Warrant relating to purchase of 5% Convertible Subordinated
Debenture (filed with Current Report on Form 8-K on June 28, 1999
and incorporated herein by reference).
10.42 Financial Statements of Technologic, Inc. (filed with the Current
Report on Form 8-K on September 27, 1999 and incorporated herein by
reference)
10.43 Stockholders Agreement dated as of September 10, 1999 (filed with
Current Report on Form 8-K on September 27, 1999 and incorporated
herein by reference).
10.44 Escrow Agreement dated as of September 10, 1999 (filed with Current
Report on Form 8-K on September 27, 1999 and incorporated herein by
reference).
23.1* Consents of BDO Seidman, LLP
23.2* Consent of Balukoff, Lindstrom & Co., P.A.
</TABLE>
- -----------------------
* Filed herewith
II-11
<PAGE> 1
Exhibit 5.1
November 23, 1999
eSoft, Inc.
295 Interlocken Boulevard, #500
Broomfield, CO 80021
Re: Form S-3 Relating to 1,471,919 Shares of Common Stock
Ladies and Gentlemen:
We have acted as counsel for eSoft, Inc., a Delaware corporation (the
"Company") in connection with the preparation of a Registration Statement on
Form S-3 (the "Registration Statement") filed by the Company with the Securities
and Exchange Commission. The Registration Statement relates to the registration
under the Securities Act of 1933, as amended (the "1933 Act"), of 1,471,919
shares of the Company's common stock, par value $.01 per share (the "Shares")
offered for the account of certain stockholders of the Company.
This opinion is delivered pursuant to the requirements of Item
601(b)(5) of Regulation S-K under the 1933 Act.
We have examined certain documents, corporate records and other
instruments and relied on originals or copies, certified or otherwise identified
to our satisfaction, of such documents, corporate records and other instruments,
have made such inquiries as to questions of fact of officers and representatives
of the Company, and have made such examinations of law as we have deemed
necessary or appropriate for purposes of giving the opinion expressed below. In
such examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and the conformity
with the originals of all documents submitted to us as copies.
The following opinions are limited solely to the applicable federal law
of the United States of America and the General Corporation Law of the State of
Delaware. While we are not licensed to practice in the State of Delaware, we
have reviewed applicable provisions of the General Corporation Law of Delaware
as we have deemed appropriate in connection with the provisions expressed
herein. Except as described, we have neither examined nor do we express any
opinion with respect to Delaware law.
<PAGE> 2
eSoft, Inc.
November 23, 1999
Page 2
Based upon and subject to the foregoing, we are of the opinion that:
1. The issuance and sale of the Shares, as provided in the Registration
Statement, have been duly and validly authorized by all necessary corporate
action of the Company.
2. The Shares that have been issued as of the date hereof have been
validly issued, fully paid and are non-assessable shares of capital stock of the
Company.
3. The Shares that have not been issued as of the date hereof will be,
when and if issued, validly issued, fully paid, and non-assessable shares of
capital stock of the Company.
We hereby consent to the filing of this opinion with the Commission as
Exhibit 5.1 to the Registration Statement. We also consent to the reference to
this firm under the heading "Validity of Securities" in the Prospectus included
in the Registration Statement as the counsel who will pass upon the validity of
the securities. In giving this consent, we do not thereby admit that we are in
the category of persons whose consent is required under Section 7 of the
Securities Act or the rules of the Securities and Exchange Commission
thereunder.
Very truly yours,
/s/ Davis, Graham & Stubbs LLP
DAVIS, GRAHAM & STUBBS LLP
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
Technologic, Inc.
Norcross, Georgia
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of our report dated August
20, 1999, relating to the financial statements of Technologic, Inc. appearing
in eSoft Inc.'s Form 8K/A dated November 17, 1999.
We also consent to the references to us under the caption "Experts" in the
Prospectus.
/s/ BDO Seidman
Atlanta, Georgia
November 24, 1999
<PAGE> 2
EXHIBIT 23.1
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
eSoft, Inc.
Broomfield, Colorado
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of our report dated January
29, 1999, relating to the financial statements of eSoft, Inc. appearing in the
Company's Annual Report on Form 10-KSB/A-1 for the year ended December 31,
1999, our report dated July 16, 1999, relating to the supplemental consolidated
financial statements of eSoft, Inc. appearing in the Company's Form 8-K dated
August 9, 1999, and our report dated November 17, 1999, relating to the
consolidated financial statements of eSoft, Inc. appearing in the Company's
Form 8-K dated November 24, 1999.
We also consent to the references to us under the caption "Experts" in the
Prospectus.
/s/ BDO Seidman
Denver, Colorado
November 24, 1999
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
eSoft, Inc..
Broomfield, Colorado
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of eSoft, Inc. of our report dated February 4, 1999,
relating to the balance sheet of Apexx Technology, Inc. as of December 31, 1998
and the statements of operations, stockholders' deficit and cash flows for each
of the two years in the period ended December 31, 1998 appearing in eSoft's 8-K
dated August 9, 1999. Our report contains an explanatory paragraph regarding
Apexx Technology, Inc.'s ability to continue as a going concern.
/s/ Balukoff, Lindstrom & Co., P.A.
Boise, Idaho
November 22, 1999
