UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 12, 2000
CERTICOM CORP.
--------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Yukon Territory, Canada 1-15010 Not Applicable
----------------------- ------------------- ----------------------
(Province or other (Commission file number) (I.R.S. Employer
jurisdiction of Identification No.)
incorporation)
Certicom Corp.
25801 Industrial Boulevard
Hayward, California 94545
-------------------------------------------------------------------------------
(Address of principal executive offices, zip code)
Registrant's telephone number, including area code: (510) 780-5400
Not Applicable
-------------------------------------------------------------------------------
(Former name or address, if changed since last report)
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On September 12, 2000, we acquired all of the outstanding stock of DRG
Resources Group, Inc., an eCommerce security consulting company located in
Redwood City, California, in exchange for 397,595 Certicom common shares (valued
at U.S.$15.5 million based on the closing price of Certicom common shares on
September 12, 2000). In connection with the acquisition, we also assumed stock
options exercisable to acquire a total of 103,100 Certicom common shares.
The stock of DRG Resources Group was acquired from the three former
shareholders (James Cowing, Michael Harris and Daniel Moy (collectively, the
"DRG Shareholders")) of DRG Resources Group. The purchase price was determined
based on our evaluation of the value of DRG Resources Group's current business
and its growth potential and the skills of its employees. Following the
acquisition, DRG Resources Group became a wholly owned subsidiary of Certicom.
We have a right to repurchase a portion of the common shares issued to a
DRG Shareholder as consideration for the acquisition (the "Repurchase
Percentage") for $0.25 per share if the DRG Shareholder terminates his
employment with us prior to March 12, 2002, unless the DRG Shareholder resigns
because we change certain conditions related to his work. In addition, we will
have a right to reacquire the Repurchase Percentage from a DRG Shareholder if we
terminate his employment for certain reasons.
The Repurchase Percentage, which we will have a right to acquire from a
DRG Shareholder, will equal 50% of the Certicom common shares acquired by such
DRG Shareholder if the DRG Shareholder ceases to be our employee under certain
circumstances prior to April 12, 2001. The Repurchase Percentage will decrease
by 4.166% of the entire number of Certicom common shares initially issued to the
DRG Shareholder for each one-month period after March 12, 2001 that the DRG
Shareholder is employed by us. For example, if a DRG Shareholder ceases to be an
employee on April 12, 2001 under circumstances in which our repurchase right
applies, we will have the right to repurchase up to 45.834% of the Certicom
common shares initially acquired by the DRG Shareholder. If a DRG Shareholder is
still an employee of DRG Resources Group on March 12, 2002, we will no longer
have a right to repurchase any Certicom common shares acquired by the DRG
Shareholder.
The Certicom common shares issued to the DRG Shareholders were
unregistered shares issued pursuant to Section 4(2) of the Securities Act of
1933. We relied on the Section 4(2) exemption because there were only three DRG
Shareholders and each shareholder represented that he was an accredited
investor. The acquisition was accounted for as a purchase.
2
<PAGE>
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 thereunto duly authorized.
Certicom Corp.
/S/ RICHARD D. BROUNSTEIN
-------------------------
Richard D. Brounstein
Senior Vice President, Finance,
Chief Financial Officer and
Secretary
