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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
FILED PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE REPORTED: February 28, 1997
FINGERMATRIX, INC.
(Exact name of registrant as specified in charter)
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File No.) Identification No.)
New York 0-9940 13-2854686
145 Palisade Street Dobbs Ferry, New York 10522-1617
(Address of Principal Executive Offices)
(914) 693-1050
(Telephone Number)
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ITEM 9. SALES OF EQUITY SECURITIES PURSUANT TO REGULATION S.
On February 10, 1997, one, Robert Francis Huddie, an English
citizen residing in Rome Italy, totally independent of the Registrant, purchased
for himself 47,555 shares of the Registrant's common stock, $.01 Par value
("Common Stock") pursuant to a Regulation S Subscription Agreement
("Subscription Agreement") at a price of $1.2617 per share for an aggregate
price of $60,000. A true copy of the Subscription Agreement is annexed as an
Exhibit.
Based upon the terms of the Subscription Agreement, there was
no underwriter or placement agent involved, although the Registrant was paying a
fee of 8% of the aggregate price to Registrant's investment adviser,
Newell-Storr & Co., Inc. Under the Subscription Agreement, Mr. Huddie
represented that he was purchasing for his own account. Mr. Huddie received no
commission or other remuneration.
The purchase price of $1.2617 per share was determined by
taking a 15% discount from the average of the low and high bid prices of the
Common Stock as quoted on the electronic bulletin board of NASDAQ for the
Registrants's Common Stock on February 10, 1997 which prices averaged $1.4843.
Upon taking the 15% discount from the average price of $1.4843 in the sum of
$.2226 per share, the purchase price per share of $1.2617 is arrived at. As
reported on electronic bulletin board of NASDAQ, 49,500 shares were traded on
February 10, 1997 at sales or market prices per share which varied from $1.50
low to $1.6875 high for an average sales price of $1.5937.
During the month of December 1996, the low and high market
prices for sales of the Registrant's Common Stock was $1.562 low and $2. high.
For the period from January 1 through January 31, 1997, the low and high market
prices were $1.625 and $2, respectively.
In the Subscription Agreement, Mr. Huddie further represented
that he was an "accredited investor" (as that term is used in Regulation D
promulgated pursuant to the Securities Act of 1933, as amended ("the Act") and
he was a "non U.S. person" as that term is used in Regulation S promulgated
under the Act. The certificate for the shares of Common Stock issued to Mr.
Huddie did not bear a restrictive legend prohibiting sale, pledge or transfer,
but a "Stop Transfer Order" was placed on the shares for a period of forty days
from date of issuance, February 20, 1997.
The Registrant is relying on Regulation S for exemption from
registration under the Act as this is a sale to non U.S. person.
On January 28, 1997, eleven non-resident persons through their
agent, ABN AMRO CARRINGTON PEMBROKE, LTD., contracted to
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purchase and did purchase pursuant to Regulation S 313,720 shares of the Common
Stock of the Registrant at a price of $1.4344 per share for an aggregate price
of $450,000 less an 8% commission payable to Newell-Storr &Co, Inc. Said
450,000 shares may not be sold or transferred for a period of forty days from
February 3, 1997, the date of issuance of said shares of Common Stock. For
further details as to this transaction, reference is made to Registrant's Form
8-K dated February 3, 1997 and filed with the Securities Exchange Commission on
February 11, 1997.
Item 10. Exhibits
Exh 10.1 Regulation S Offshore Subscription Agreement dated February
10, 1997 executed by Robert Francis Huddie.
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Dated: February 28, 1997 Fingermatrix, Inc.
By Thomas T. Harding
Thomas T. Harding, President
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REGULATION S OFFSHORE SUBSCRIPTION AGREEMENT
Fingermatrix, Inc.
145 Palisade Street
Dobbs Ferry, New York 10522-1617
Attention: Mr. Thomas T. Harding, President
WHEREAS, FINGERMATRIX, INC. (the "Company") has determined to
sell its Common Stock ($.01 par value), as authorized and pursuant
to Regulation S, 17 CFR Section 240.901 et. seq. ("Regulation S"),
promulgated under the U.S. Securities Act of 1933 ("the Act"); and
WHEREAS, the Company is a reporting issuer within the meaning
of Rule 902(l) of Regulation S; and
WHEREAS, the subscribing person or persons signing below
(singularly or collectively the "Undersigned") hereby subscribes
for and agrees to purchase from the Company its shares of Common
Stock (the "Securities" ) as set forth below in Section 4.01 upon
the terms and conditions provided herein, and pursuant to the
requirements of Regulation S and agrees, tenders, and represents as
set forth herein;
THEREFORE, in consideration of the mutual promises herein
contained, the parties hereto agree as follows:
1. The Company covenants as follows:
1.01 That the Company shall maintain its status as a
corporation in good standing and a reporting issuer
within the meaning of Rule 902(l) of Regulation S;
and
1.02 That the Company shall provide the Undersigned
with information, subject to limitations dictated
by confidentiality and non-public information,
regarding the Company, including annual financial
statements, at the Undersigned's request; and
1.03 That the issuance, sale and delivery of the
Securities are within the Company's corporate
authority and have been duly authorized by all
appropriate corporate action; when such Securities
are issued, they will be validly issued, fully paid
and non-assessable; and
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1.04 That the Company will be paying an 8% fee to
its agents who secured this transaction and,
accordingly, there will only be available to the
Company 92% of the amount subscribed for hereby.
2. The Undersigned covenants as follows:
2.01 That it is purchasing the Securities in an Offshore
Transaction which meets the requirements set forth
in Rule 902(i) of Regulation S; and
2.02 That it is not a U.S. person as that term is
defined in Rule 902(o) of Regulation S; and
2.03 That it is not an affiliate of the Company as
defined in the U.S. Securities Act of 1933 (the
"Securities Act"), and that following the purchase
of the Securities, neither the Undersigned nor any
of its affiliates will be affiliates of the
Company; and
2.04 That at the time of this offer and sale of the
Securities, the Undersigned was outside the
United States, and that no offer to purchase or
sell the Securities was made by the Undersigned or
its affiliates in the United States; that this
offer and sale of the Securities have not and will
not be pre-arranged with any U.S. person; and that
this transaction is not and will not be part of any
plan or scheme to evade the Securities Act or its
registration provisions; and
2.05 That it is aware that the Securities are not
registered in and cannot be sold in the
United States or to any U.S. person, as defined by
Regulation S, prior to the end of the restricted
period, as set forth in Rule 903(c)(2) of
Regulation S, absent registration or exemption
therefrom, but, notwithstanding the foregoing,
if the Company shall cease for any reason to be
a "reporting issuer" prior to the expiration of
the restricted period under Rule 903(c)(1), then
the Securities shall not be transferable for a
period of one year from date of issuance of the
certificates representing the Securities as
provided in Rule 903(c)(3); and
2.06 That it is aware that any offers or sales of
the Securities prior to the expiration of the
restricted period set forth in Rule 903(c)(2)
or (3), as the case may be, of Regulation S must
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be made only in accordance with the provisions of
Rules 903 or 904 of Regulation S as applicable;
and
2.07 That it is not aware of any and has not
participated in any Directed Selling Efforts, as
set forth in Rule 902(k) of Regulation S, on behalf
of the Company or its agents, and that any offering
materials received contain the disclosure that the
Securities are not registered under the Securities
Act and cannot be offered or sold in the United
States or to U.S. persons, prior to the end of the
restricted period, as set forth in Rule 903(c)(2)
of Regulation S absent registration or exemption
therefrom pursuant to the Securities Act; and
2.08 That during the restricted period, as set forth in
Rule 903 (c) of Regulation S, the Undersigned will
take all steps necessary to ensure compliance with
Regulation S including, but not limited to,
advising each person involved in any subsequent
transaction involving the Securities of their
restricted nature, of the requirements of
Regulation S, and of such person's obligation to
comply with Regulation S; and
2.09 That neither the Undersigned nor any of its
affiliates have or will, directly or indirectly,
maintain any short position in any securities of
the Company or its affiliates until after the end
of the restricted period provided herein. Prior
to the end of such restricted period, neither the
Undersigned nor its affiliates shall, directly or
indirectly, engage in any other hedging transaction
in connection with the securities of the Company
or its affiliates including, but not limited to,
options, swaps, or other derivative transactions;
and
2.10 That it covenants that it has reviewed this
transaction with its legal counsel and advisors,
and covenants that such purchase is in compliance
with its national and local securities laws or
regulations, and agrees to advise the Company if
such laws or regulations require the Company
to place any legends or restrictions on the
certificates representing the Securities. The
Undersigned undertakes to take all steps necessary
to ensure that any purchase, offer or sale of
the Securities will comply with the laws and
regulations of all necessary foreign regulatory
or self-regulatory authorities and upon request
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shall provide to the Company opinions of legal
counsel regarding such compliance.
3. Terms of the Subscription Agreement:
3.01 This Subscription Agreement shall become an
agreement binding on the Company only if and when
executed in the name and on behalf of the Company,
and when notice of such execution and acceptance,
which may be a copy or similar counterpart hereof,
is tele-faxed or mailed to the Undersigned; and
3.02 The Company reserves the right to reject any
subscription tendered to it, in whole or in part,
in which case it will promptly return the
consideration tendered herewith to the Undersigned;
and
3.03 The Undersigned has reviewed its financial
condition and commitments and it is satisfied that
it has no immediate foreseeable need to make any
disposition of the Securities. In addition, it
understands that the Company is under no
obligation, and has no intention, to register the
Securities under the Securities Act or any other
act, or meet the reporting requirements under Rule
144 of said Act. Accordingly, the Undersigned
understands that the Securities may be transferred
only pursuant to Regulation S, or pursuant to an
exemption from registration or a formal
registration under the Securities and Exchange
Commission's or applicable state Securities
Commission's rules. Finally, the Undersigned
understands that the Company may unilaterally
refuse to approve any transfer made in violation of
Regulation S or in violation of the Securities Act
of 193, as amended; and
3.04 The Undersigned has reviewed the Company's Form 10-
K filed with the U.S. Securities and Exchange
Commission for the years ended September 30, 1995
and 1996 and the financial statements of the
Company included therein and the Undersigned is
aware that: (i) the Company as of the date hereof
has not had any revenue from the sale of the
Company's products and services and, accordingly,
is deemed to be a development stage company; (ii)
the Company is dependent on and shall be dependent
on the sale of the Company's securities (such as
the purchase contemplated hereby) for its continued
development of the Company's products and services;
(iii) the Company's independent certified auditors
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have issued for the fiscal year ended September 30,
1996 an opinion indicating that the future of the
Company as a going concern is in doubt in view of:
the Company being a development stage company
having emerged from bankruptcy in April 1995, the
Company having generated no revenues in 1995 and
1996, and the Company having limited working
capital.
3.05 The Undersigned is an "accredited investor" within
the meaning of Rule 501(a) under the Act or an
entity in which all of the equity owners are
accredited investors within the meaning of Rule
5Ol(a) under the Act. The Undersigned is
purchasing the Securities for its own account or
as a fiduciary for the account of one or more
trusts, each of whom is an "accredited investor"
within the meaning of Rule 501(a)(7) under the Act
and for each of which the Undersigned exercises
sole investment discretion. The Undersigned is
not acquiring the Securities for or on behalf of,
nor will it transfer the Securities to, any pension
or welfare plan (as defined in Section 3 of the
U.S. Employee Retirement Income Security Act); and
3.06 The Undersigned is knowledgeable, sophisticated
and experienced in business and financial matters
and in securities similar to the Securities, and
is capable of evaluating the merits and risks of
purchasing the Securities. The Undersigned
acknowledges and understands that the purchase of
the Securities involves risks, including the risk
of dilution, diminution in value, or total loss of
investment. The Undersigned has had access to, or
been furnished with, all information about the
Securities and the Company as the Undersigned has
deemed necessary, and has been afforded the
opportunity to ask such questions of
representatives of the Company and to receive
answers thereto as the Undersigned has deemed
necessary in connection with its decision to
purchase the Securities: and
3.07 The Undersigned is purchasing the Securities for
investment, and has not previously solicited the
transfer, resale or disposal of the Securities and
presently does not have a view to, or the purpose
of, engaging in a distribution thereof or of
transferring, reselling or otherwise disposing of
any of the Securities, or any interest therein in
any transaction that would be in violation of the
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securities laws of the United States or any state
thereof; and
3.08 The Undersigned has all requisite corporate power
and authority to enter into, deliver and perform
its obligations under this Agreement. This
Agreement has been duly authorized, executed and
delivered by the Undersigned, and all legally
required corporate proceedings by the Undersigned
in connection with the execution, delivery and
performance of this Agreement have been taken.
This Agreement constitutes a valid and binding
obligation of the Undersigned, enforceable against
it in accordance with its terms, except as the
enforceability of such Agreement may be affected or
limited by (i) bankruptcy, insolvency,
reorganization, arrangement, moratorium or other
similar laws relating to or affecting the rights of
creditors generally, or (ii) general principles of
equity (regardless of whether such enforceability
is considered in a proceeding in equity or at law);
and
3.09 There are no claims for brokerage commissions,
finders' fees or similar compensation in connection
with the transactions contemplated by this
Agreement based on any arrangement or agreement
binding upon the Undersigned or any of its
respective subsidiaries; and
3.10 The Undersigned acknowledges and understands that
no U.S. Federal or State Agency has made any
finding or determination as to the fairness for
public investment, nor any recommendation or
endorsement, of the Securities. The Undersigned
represents that it fully understands the nature of
the investment being made and the substantial risks
thereof; and
3.11 The Undersigned acknowledges that the Company will
advise its transfer agent upon issuance of the
Securities of the limitations upon the transfer of
such Securities as set forth herein (including, but
not limited to, Section 2.05, above, and Section
3.12, below) pursuant to Regulation S; and
3.12 In accordance with Rule 903 (c) (2) Of Regulation
S, the Undersigned agrees to forebear from selling
the Securities for a period of not less than forty
(40) days from the later of the following dates:
the date of this Subscription Agreement; or the
date upon which the Company collects the Total
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Price of the Securities, as defined herein. The
Undersigned acknowledges that this holding period
will not be applicable if the Company loses its
status as a "reporting issuer", in which case the
one year holding period would be applicable in
accordance with Rule 903 (c) (3) of Regulation S;
and
3.13 The provisions of this Subscription Agreement
shall be construed and enforced according to
the laws of the United States and the State of
New York. In the event there is any conflict
between any offering or sales material and this
Subscription Agreement, the terms set forth in
this Subscription Agreement shall be controlling;
and
3.14 This Subscription Agreement may be executed in
any number of counterparts, all of which shall
constitute one and the same agreement. If this
Subscription Agreement is entered into by more
than one person, all statements and representations
herein are made and incurred both jointly and
severally by each of the Undersigned.
4. Purchase of Securities:
4.01 The price per share of Common Stock forming the
Securities hereby purchase shall be $ 1.2617,
being fifteen (15%) percent below the average of
the low bid and high bid price per share of Common
Stock on date of execution hereof as reported on
the Automated Electronic Bulletin Board of NASDAQ.
Accordingly, 47,555 shares of Common Stock are
being purchased hereby for an aggregate offering
price of the Securities of $60,000.14, which is
the aggregate consideration for the Securities (the
"Total Price"); and
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4.03 The Undersigned shall tender the amount set
forth in paragraph 4.01 herein (the "Subscription
Amount") by forwarding this Subscription Agreement
to the Company, or to its designated agent, at
the Company's address set forth on the first page
hereof, and by transmitting guaranteed U.S. funds
via wire transfer in the amount of the Subscription
Amount payable to the order of Fingermatrix, Inc.,
or its designated agent as follows:
Bank: Hudson Valley Bank
328 Central Avenue
White Plains, NY 10606
Routing #021909300
Account #0802364601 ;
and
4.04 The Undersigned requests that the certificate or
certificates for the Securities purchased hereunder
be registered in the name subscribed below and the
registered address of such security holder in
Fingermatrix, Inc.'s stock register or books will
be the address set forth below:
Name : ROBERT FRANCIS HUDDIE
Address: PIAZZA DI PIETRA 63, INT 8
00186 ROMA
ITALY
Subscription Amount: $60,000.14
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The Undersigned attests that its offices are maintained at the address
listed above.
Investor: ROBERT FRANCIS HUDDIE
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Print Name(s) OR (Title if Corporation)
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Signature of Officer
Attest: --------------------------------------------------------------
[PROFESSIONAL CORPORATIONS ONLY] Corporate Secretary Must Sign
Date : February 10th, 1997
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ACCEPTED BY: (INVESTOR DOES NOT SIGN HERE)
FINGERMATRIX, INC.
By: Thomas T. Harding 2/19/97
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Thomas T. Harding Date of Acceptance
President, CEO