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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 7, 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 January 28, 1997, ABN AMRO CARRINGTON PEMBROKE, LIMITED
("ABN"), an English company, totally independent of the Registrant, purchased as
agent for its eleven named clients 313,720 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 $1.4344 per share for an
aggregate price of $450,000. A true copy of the Subscription Agreement is
annexed as 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, ABN represented for
its clients that each client was purchasing for its own account. ABN received no
commission or other remuneration.
The purchase price of $1.4344 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 January 28, 1997 which prices averaged $1.6875.
Upon taking the 15% discount from the average price of $1.6875 in the sum of
$.2531 per share, the purchase price per share of $1.4344 is arrived at. As
reported on electronic bulletin board of NASDAQ, 12,700 shares were traded on
January 28, 1997 at sales or market prices per share which varied from $1.6875
low and $1.8125 high for an average price of $1.7500.
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 $2, respectively.
In the Subscription Agreement, ABN further represented that
its clients were "accredited investors" (as that term is used in Regulation D
promulgated pursuant to the Securities Act of 1933, as amended ("the Act") and
it and each of its clients were "non U.S. person(s)" as that term is used in
Regulation S promulgated under the Act. None of the certificates for the shares
of Common Stock issued to the eleven clients of ABN bore a restrictive legend
prohibiting sale, pledge or transfer, but a "Stop Transfer Order" was placed on
the shares for a period of forty days from date of issuance, February 3, 1997.
The Registrant has agreed to refund the purchase price to the purchasers if the
Registrant should cease being a "reporting company" as defined under Regulation
S, prior to the elapse of the forty day period, which ends on March 15, 1997, a
Saturday.
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The Registrant is relying on Regulation S for exemption from
registration under the Act as this is a sale to non U.S. persons.
Item 10. Exhibits
Exh 10.1 Regulation S Offshore Subscription Agreement dated January 28,
1997 executed by ABN AMRO CARRINGTON PEMBROKE, LIMITED, as agent.
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Dated: February 7, 1997 Fingermatrix, Inc.
Thomas T. Harding
By --------------------
Thomas T. Harding, President
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REGULATION S OFFSHORE SUBSCRIPTION AGREEMENT
Fingermatrix, Inc.
145 Palisade Street
Dobbs Ferry, New York 10522-1617
Attention: Mr. Thomas T. Harding, President
WHEREAS, FINGERMATRIX, INC. (the "Company") has determined to
sell its Common Stock ($.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 signing below (the "Undersigned")
hereby subscribes for itself and for its clients-beneficiaries listed in
Schedule 1 annexed hereto and made a part hereof (hereafter referred to as
"Clients") and agrees for itself and its Clients 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 on behalf of itself and its Clients 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
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are issued, they will be validly issued, fully paid
and non-assessable; and
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 for itself and each of its Clients covenants as
follows:
2.01 That it and each of its Clients are 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 and each of its Clients are not a U.S. person as
that term is defined in Rule 902(o) of Regulation S; and
2.03 That it and each of its Clients are 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 its Clients nor
any of their affiliates
will be affiliates of the Company; and
2.04 That at the time of this offer and sale of the
Securities, the Undersigned and each of its Clients
were 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 and each of its Clients are 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
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certificates representing the Securities as provided in Rule
903(c)(3); and
2.06 That it and each of its Clients are 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 be made only in accordance with the provisions
of Rules 903 or 904 of Regulation S as applicable;
and
2.07 That it and each of its Clients are not aware of 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 and
each of its Clients 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 the Undersigned and each of its Clients and any
of their respective affiliates have not or will not,
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,
the Undersigned and each of its Clients and any of
their respective affiliates shall not, 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 the Undersigned covenants that it has reviewed
this transaction for itself and each of its Clients
with its legal counsel and advisors, and covenants
that such purchase is in compliance with its
3
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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 for itself and each of
its Clients 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 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 and its
Clients have no immediate foreseeable need to make
any disposition of the Securities. In addition, it
and each of its Clients understand 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 and its Clients understand 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 and its Clients understand that the
Company may unilaterally refuse to approve any
transfer made in violation of Regulation S or in
violation of the Securities Act of 1993, as amended;
and
3.04 The Undersigned has reviewed for itself and as
fiduciary for its Clients the Company's Form 10-K
4
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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 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 501(a) under the
Act. The Undersigned is purchasing the Securities for
its own accounts and as a fiduciary for the accounts
of its Clients, each of whom is an "accredited
investor" within the meaning of Rule 501(a)(7) under
the Act and for each of which Client the Undersigned
exercises sole investment discretion. The Undersigned
and each of its Clients are 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
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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 and each of its Clients are
purchasing the Securities for investment, and have
not previously solicited the transfer, resale or
disposal of the Securities and presently do 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 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. It further has the
authority and power to obligate each of its Clients
to the covenants and terms of 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 and its Clients, 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
its Clients or any of their
respective subsidiaries; and
3.10 The Undersigned and each of its Clients acknowledge
and understand 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
6
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understands both
for itself and its Clients the nature of the
investment being made and the substantial risks
thereof; and
3.11 The Undersigned for itself and each of its Clients
acknowledge 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 and each of its Clients agree 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 Price of the Securities, as
defined herein. The Undersigned acknowledges for
itself and its Clients 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 U.S. $ , 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
7
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the Automated
Electronic Bulletin Board of NASDAQ. Accordingly,
313,720 shares of Common Stock are being purchased hereby for
an aggregate offering price of the Securities of Four
Hundred and Fifty Thousand U.S. Dollars (U.S. $450,000), which
is the aggregate consideration for the Securities
(the "Total Price"); and
4.02 In the event that the Company should lose its status
as a "reporting issuer" within the forty days from
the consummation of this sale, i.e., the forty day
restrictive period set forth in Rule 903(c)(2), the
Company covenants to forthwith return the Total Price
to the Undersigned and its Clients and the
Undersigned and its Clients at their option shall
either return to the Company the certificates for the
Common Stock or return the Total Price; after the
expiration of said forty day period, the Company
shall have no liability to return the Total Price or
any portion thereof to the Undersigned and its
Clients if the Company should cease being a reporting
issuer; notwithstanding the Company's liability to
return the Total Price as provided in this Section
4.02, the sale of the Securities is final and
complete upon the Undersigned paying the Total Price
and the Securities are issued as provided in Sections
4.03 and 4.04 below; and
4.03 The Undersigned for itself and its Clients 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 names subscribed
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to in Schedule
1 annexed and the registered address of such security
holder in Fingermatrix, Inc.'s stock register or
books will be the addresses set forth in Schedule 1
annexed.
The Undersigned executes this Agreement on its own behalf and each of
its Clients listed in Schedule 1 and it attests that the addresses listed in
Schedule 1 are the residences or offices maintained by such Clients.
ABN AMRO CARRINGTON PEMBROKE LIMITED
A.F. Hames
By: ---------------------------
Print Name: A.F. Hames
Attest: --------------------------------------------------------------
[PROFESSIONAL CORPORATIONS ONLY] Corporate Secretary Must Sign
Date: 28 January 1997
ACCEPTED BY: (INVESTOR DOES NOT SIGN HERE)
FINGERMATRIX, INC.
Thomas T. Harding January 28, 1997
By:------------------------- ---------------------------
Date of Acceptance
9
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SCHEDULE 1
TO REGULATION S OFFSHORE SUBSCRIPTION AGREEMENT
<TABLE>
<CAPTION>
SHARES
US$ SUBSCRIBED
NO. NAME AND ADDRESS SUBSCRIBED FOR
<S> <C> <C> <C>
1. Adventatum Jersey Ltd "K" US$100,000 69,716
5874 Account
P O Box 641
No 1 Seaton Place
ST HELIER
Jersey JE4 8YJ
Channel Islands
British Isles
2. St Andrew Establishment US$25,000 17,429
c/o Messrs Biddle & Co
1 Gresham Street
London EC2V 7BU
England
3. Maitland Trustees Limited US$15,000 10,457
A/C JC 2172
c/o Solon S A
6 Boulevard Georges-Favon
Box 5726
1211 Geneva 11
Switzerland
4. J W Bailey Esq US$20,000 13,943
4 Woodland Close
Thorpe
Ashbourne
Derbyshire DE6 2AP
England
5. P W Darwin Esq US$15,000 10,457
Gore Street
London SW7 5PT
England
6. Dr M and MRS B Luzzatto US$25,000 17,429
c/o Mrs L Brittain
Unione Italiana (UK)
Reinsurance Company
118/119 Fenchurch Street
London EC3M 5BA
England
/Continued
<PAGE>
7. The Master, Fellows and US$60,000 41,829
Scholars of Trinity Hall
Trinity Hall
Cambridge CB2 1TJ
England
8. The Principal and Scholars US$60,000 41,829
of the King's Hall and the
College of Brasenose in
Oxford
Brasenose College
Oxford OX1 4AJ
England
9. Elvaston Investments Limited US$50,000 34,858
c/o S Chapman Esq
Messrs Wm Robertshaw & Myers
18 Cooke Street
Keighley
West Yorkshire BD21 3NP
England
10. W. Kessler Esq US$25,000 17,429
20 Seaforth Gardens
Winchmore Hill
London N21 3BS
England
11. Royal Bank of Scotland plc US$55,000 38,344
Trustee of the Pembroke
World Fund Unit Trust
Regent's House
P O Box 348
42 Islington High Street
London N1 8XL
England
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TOTAL 313,720
</TABLE>
