<PAGE> 1
As filed with the Securities and Exchange Commission on January 14, 1998
Registration No. 333-___
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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N2K Inc.
(Exact name of registrant as specified in its charter)
N2K Inc.
55 Broad Street
26th Floor
Delaware New York, NY 10004 06-1455771
(State or other (Address of Principal Executive (I.R.S. Employer
jurisdiction of Offices) (Zipcode) Identification No.)
incorporation or
organization)
1996 Employee Stock Purchase Plan
(Full Title of the Plan)
Jonathan V. Diamond
Vice Chairman
N2K Inc.
55 Broad Street, 26th Floor
New York, New York 10004
(Name and address of agent for service)
Telephone number, including area code, of agent for service: 212-378-5555
Copies of all communications, including all communications sent to
the agent for service, should be sent to:
Frank E. Morgan II, Esq.
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
(212) 259-8000
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
TITLE OF SECURITIES TO BE AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
REGISTERED REGISTERED OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION FEE
SHARE(1) PRICE(1)
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<S> <C> <C> <C> <C>
Common Stock, par value
$.001 per share 1,500,000 Shares $17 $25,500,000 $7,522.50
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rules 457(c) and 457(h) under the Securities Act of 1933, as
amended. Based on the average of the high and low prices of Registrant's
Common Stock on the NASDAQ National Market ("NASDAQ") on January 8, 1998.
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION
Not required pursuant to the instructions of Form S-8.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION
Not required pursuant to the instructions of Form S-8.
I-2
<PAGE> 3
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
Registrant's prospectus, filed pursuant to Rule 424(b), dated October 17,
1997, is incorporated herein by reference. In addition, all documents filed or
subsequently filed by the Registrant pursuant to Sections 13(a), 13(c), 14 and
15(d) of the 1934 Act, prior to the termination of this Offering, are deemed
incorporated by reference into this prospectus.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Certificate of Incorporation provides that a director or
officer of the Company shall not be personally liable to it or its stockholders
for monetary damages to the fullest extent permitted by the Delaware General
Corporation Law ("GCL"). Section 102(b)(7) of the Delaware GCL currently
provides that a director's or officer's liability for breach of fiduciary duty
to a corporation may be eliminated except for liability (i) for any breach of
the director's or officer's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174 of
the Delaware GCL, for unlawful dividends or unlawful stock repurchases or
redemptions, and (iv) for any transaction from which the director or officer
derives an improper personal benefit. The Delaware GCL does afford persons who
serve on the board of directors of a Delaware corporation protection against
awards of monetary damages for negligence in the performance of their duties as
directors. The Delaware GCL does not affect the availability of equitable
remedies such as an injunction or rescission based upon a director's or
officer's breach of his duty of care. Any amendment to these provisions of the
Delaware GCL will automatically be incorporated by reference into the Company's
Certificate of Incorporation, without any vote on the part of its stockholders,
unless otherwise required.
Pursuant to the provisions of Section 145 of the Delaware GCL, every
Delaware corporation has the power to indemnify any person who was or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation) by reason of the
fact that such person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by such person in connection with such action, suit or proceeding. The
power to indemnify applies only if such person acted in good faith and in a
manner such person reasonably believed to be in or not opposed to the best
interests of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe that his or her conduct was
unlawful.
II-1
<PAGE> 4
The power to indemnify applies to actions brought by or in the right of
the corporation as well, but only to the extent of defense or settlement
expenses and not to any satisfaction of a judgment or settlement of the claim
itself, and with the further limitation that in such actions no indemnification
shall be made in the event of any adjudication of negligence or misconduct
unless the court, in its discretion, believes that in light of all the
circumstances indemnification should apply. Such indemnification is not
exclusive of any other rights to which those indemnified may be entitled under
any by-laws, agreement, vote of stockholders or otherwise.
Indemnification Agreements. The Company and each of its directors and
executive officers has entered into indemnification agreements. The
indemnification agreements provide that the Company will indemnify the directors
and executive officers against certain liabilities (including settlements) and
expenses actually and reasonably incurred by them in connection with any
threatened, pending or completed legal action, proceeding or investigation
(other than actions brought by or in the right of the Company) to which any of
them was, is or is threatened to be made a party by reason of his or her status
as a director, officer or agent of the Company or his or her serving at the
request of the Company in any other capacity for or on behalf of the Company,
provided that (i) such person acted in good faith and in a manner at least not
opposed to the best interests of the Company, (ii) with respect to any criminal
proceedings, such person had no reasonable cause to believe his or her conduct
was unlawful, (iii) such person is not finally adjudged to be liable for
negligence or misconduct in the performance of his or her duty to the Company,
unless the court views in light of the circumstances that the director or
executive officer is nevertheless entitled to indemnification, and (iv) the
indemnification does not relate to any liability arising under Section 16(b) of
the 1934 Act or the rules or regulations promulgated thereunder. With respect to
any action brought by or in the right of the Company, directors and executive
officers may also be indemnified, to the extent not prohibited by applicable
laws or as determined by a court of competent jurisdiction, against reasonable
costs and expenses incurred by them in connection with such action if they acted
in good faith and in a manner they reasonably believed to be in or not opposed
to the best interests of the Company.
Insofar as indemnification for liabilities arising under the 1933 Act may
be permitted to directors, officers or persons controlling the Company pursuant
to the foregoing provisions, the Company has been informed that in the opinion
of the Commission such indemnification is against public policy as expressed in
the 1933 Act and is therefore unenforceable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Any restricted securities to be offered or resold pursuant to this
Registration Statement are exempt under Section 4(2) of the 1933 Act, as a
non-public offering of securities.
ITEM 8. EXHIBITS
EXHIBIT DESCRIPTION
4.1 Form of Certificate of Incorporation of the Registrant, as amended.
4.2 Form of Bylaws of the Registrant, as amended.
4.3 1996 Employee Stock Purchase Plan of the Company.
5 Opinion of Dewey Ballantine LLP.
23.1 Consent of Dewey Ballantine LLP (contained in Exhibit 5).
23.2 Consent of Arthur Andersen LLP.
23.3 Consent of Richard A. Eisner & Company, LLP.
24 Power of attorney (included on signature page).
II-2
<PAGE> 5
ITEM 9. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) 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 1993;
(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; 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)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3, Form S-8 or Form F-3 and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission 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.
(2) 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.
(3) To remove from registration by means of post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(b) That, for 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 the registration statement 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) 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 such indemnification is against public policy as expressed
in the 1933 Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses 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 1933 Act and
will be governed by the final adjudication of such issue.
II-3
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to be believe it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York, on January 14, 1998.
N2K INC.
By: /s/ Lawrence L. Rosen
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Lawrence L. Rosen
Chairman of the Board and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each person whose signature appears
below under the heading "Signatures" constitutes and appoints Jonathan V.
Diamond and Bruce Johnson his true and lawful attorneys-in-fact and agents, each
acting alone, with full power of substitution and resubstitution, for him and in
his name, place and stead, in any and all capacities, to sign any or all
amendments to this Registration Statement, including post-effective amendments,
and to file the same with all exhibits thereto, and all documents in connection
therewith, including, without limitation, any registration statement for the
same offering that is to be effective upon filing pursuant to Rule 462(b) under
the Securities Act of 1933, with the Securities and Exchange Commission,
granting unto 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 and about the premises, as fully to all intents and purposes as he
might or could do in person, and hereby ratifies and confirms all that said
attorneys-in-fact and agents, each acting alone, or their substitute or
substitutes, may lawfully do or cause to be done.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on the 14th day of January , 1998.
Signature Title
--------- -----
/s/ Lawrence L. Rosen Chairman of the Board, Chief Executive
- ----------------------------------- Officer and Director (Principal Executive
Lawrence L. Rosen Officer)
/s/ Jonathan V. Diamond Vice Chairman and Director
- -----------------------------------
Jonathan V. Diamond
/s/ Robert David Grusin Vice Chairman and Director
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Robert David Grusin
<PAGE> 7
/s/ James E. Coane President, Chief Operating Officer and
- ----------------------------------- Director
James E. Coane
/s/ Bruce Johnson Vice President, Secretary, Chief Financing
- ----------------------------------- Officer (Principal Accounting Officer and
Bruce Johnson Principal Financial Officer) and Director
/s/ Robert C. Harris, Jr. Director
- -----------------------------------
Robert C. Harris, Jr.
/s/ Susanne Harrison Director
- -----------------------------------
Susanne Harrison
<PAGE> 8
INDEX TO EXHIBITS
The following documents are filed as part of this Registration Statement.
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Exhibit Location
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<S> <C> <C>
4.1 Form of Certificate of Incorporation of the Incorporated by reference from Exhibit 3.1 to the
Registrant, as amended. Registrant's Registration Statement on Form S-1,
Registration Statement No. 333-33105, filed with
the Securities and Exchange Commission
("Commission") on August 7, 1997.
4.2 Form of Bylaws of the Registrant, as Incorporated by reference from Exhibit 3.2 to the
amended. Registrant's Registration Statement on Form S-1,
Registration Statement No. 333-33105, filed with
the Commission on August 7, 1997.
4.3 1996 Employee Stock Purchase Plan of the Attached.
Company.
5 Opinion of Dewey Ballantine LLP, re: Attached.
legality, including consent.
23.1 Consent of Dewey Ballantine LLP. Contained in Exhibit 5.
23.2 Consent of Arthur Andersen LLP. Attached.
23.3 Consent of Richard A. Eisner & Company, LLP. Attached.
24 Power of Attorney. Included on signature page.
</TABLE>
<PAGE> 1
EXHIBIT 4.3
N2K INC
1996 EMPLOYEE STOCK PURCHASE PLAN
ARTICLE I
PURPOSE AND COMMENCEMENT
1.01 Purpose. The purpose of the Plan is to provide the employees of
N2K Inc., a Delaware corporation (the "Company") and its Subsidiaries with added
incentive to continue in their employment and to encourage increased efforts to
promote the best interests of the Company by permitting eligible employees to
purchase shares of Common Stock of the Company at prices less than the current
market price thereof. The Plan is intended to qualify as an employee stock
purchase plan under Section 423 of the Code and shall be interpreted and
construed in accordance with such purpose.
1.02 Commencement. The Plan shall become effective on such date as
may be specified by the Board of Directors, which, absent a resolution of the
Board of Directors to the contrary, shall be as set forth in Section 2.01(o)
hereof; provided, however, that, in no event, shall the Plan become effective
unless within twelve months of the date of its adoption by the Board of
Directors it has been approved by the affirmative vote of a majority of the
issued and outstanding shares of the Company's securities entitled to vote on
such matters at a duly called meeting of the shareholders of the Company.
ARTICLE II
DEFINITIONS
2.01 Definitions. As used in the Plan, the following terms and
phrases shall have the following meanings:
(a) "Board of Directors" shall mean the Board of Directors of the
Company.
(b) "Closing Market Price" shall mean (i) if the Common Stock is
traded on a national securities exchange, the Closing Market Price shall be the
closing price reported by the applicable composite transactions report on the
date of any determination or, if the Common Stock is not traded on such date,
the closing price so reported on the next following date on which the Common
Stock is traded on such exchange, or (ii) if the foregoing provision is
inapplicable, the Closing Market Price shall be determined by the Committee in
good faith on such basis as it deems appropriate.
<PAGE> 2
(c) "Code" shall mean the Internal Revenue Code as of 1986, as
amended.
(d) "Commencement Date" shall mean the first day of a Plan Quarter.
(e) "Committee" shall mean the Compensation Committee of the Board
of Directors, or such other committee of the Board of Directors designated by it
for purposes of administering the Plan.
(f) "Common Stock" means the common stock of the Company, par value
$0.001 per share.
(g) "Company" shall mean N2K Inc., a Delaware corporation.
(h) "Contribution Account" shall mean the account established on
behalf of a Participant pursuant to Article IV hereof to which shall be credited
his or her Participant Contributions.
(i) "Contribution Rate" shall be a percentage of a Participant's
Covered Compensation during each payroll period designated by each Participant
to be contributed by regular payroll deductions to his or her Contribution
Account as set forth in Section 3.03 hereof.
(j) "Covered Compensation" shall mean the total cash compensation
received by an Employee from a Sponsoring Employer, before tax withholdings and
other deductions, including base compensation, overtime, shift or other
compensatory premiums, payments in substitution of base compensation such as
vacation, holiday and sick pay, and including all cash bonus compensation, but
not including short or long-term disability payments.
(k) "Employee" shall mean each employee of a Sponsoring Employer
whose customary employment is at least twenty (20) hours a week and more than
five months in a calendar year. For purposes of the Plan, "employment" shall be
determined in accordance with the provisions of Section 1.421-7(h) of the
Treasury Regulations (or any successor regulations).
(l) "Participant" shall mean any Employee of a Sponsoring Employer
who has met the conditions and provisions for becoming a Participant set forth
in Article III hereof.
(m) "Participant Contributions" shall be the aggregate dollars
actually contributed by each Participant to his or her Contribution Account.
(n) "Permanent Disability" shall mean an illness, injury or other
physical or mental condition continuing for at least 180 consecutive days which
results in
<PAGE> 3
an Employee's inability to provide in all material respects the duties
theretofore performed in his or her capacity as an Employee of a Sponsoring
Employer.
(o) "Plan" shall mean the N2K Inc. 1996 Employee Stock Purchase Plan
as set forth herein, as it may be amended from time to time.
(p) "Plan Quarter" shall mean each calendar quarter. The first Plan
Quarter shall be the Plan Quarter commencing on October 1, 1996 and ending on
December 31, 1996, or such later Plan Quarter as may be determined by the
Committee.
(q) "Purchase Date" shall mean the last business day of a Plan
Quarter on which the Common Stock publicly trades.
(r) "Purchase Price" shall mean the purchase price for a share of
Common Stock to be paid by a Participant on a Purchase Date, as determined under
Section 4.02 hereof.
(s) "Request for Participation" shall mean such form as shall be
approved by the Committee for distribution to Employees in connection with
participation in the Plan.
(t) "Sponsoring Employers" shall mean the Company and each
Subsidiary that has been designated by the Committee as a Sponsoring Employer
under the Plan.
(u) "Subsidiary" shall mean a subsidiary of the Company which is
treated as a subsidiary corporation under Section 424(f) of the Code.
ARTICLE III
ELIGIBILITY AND PARTICIPATION
3.01 Eligibility. Each Employee shall become eligible to be a
Participant of the Plan and may participate therein as of the Commencement Date
of a Plan Quarter if such Employee has been an Employee for at least six months
prior to such Commencement Date.
3.02 Limitations. Notwithstanding anything to the contrary contained
in the Plan, no right to purchase Common Stock shall accrue under the Plan in
favor of any person who is not an Employee eligible to participate in the Plan
under Section 3.01 hereof, and no Employee shall acquire the right to purchase
shares of Common Stock if (i) immediately after receiving such right to purchase
Common Stock, such Employee would own 5% or more of the total combined voting
power or value of all classes of stock of the Company or any Subsidiary, taking
into account in determining stock ownership any stock attributable to such
Employee under Section 424(d) of the Code, or (ii) which would
<PAGE> 4
permit such Employee's right to purchase stock under all employee stock purchase
plans (to which Section 423 of the Code applies) of the Company and its
Subsidiaries, as those plans are in effect from time to time, to accrue at a
rate which exceeds $25,000 of fair market value of such stock (as determined as
each Commencement Date) for each calendar year, all as specified in the manner
provided by Section 423(b)(8) of the Code, or (iii) which would permit such
Employee the right to purchase more than 10,000 shares (or such other number as
may be determined in advance for any Plan Quarter by the Committee) of Common
Stock in any Plan Quarter.
3.03 Participation.
(a) Each Employee eligible to be a Participant and participate in
the Plan shall be furnished a summary of the Plan and a Request for
Participation by such Employee's Sponsoring Employer. If an Employee elects to
participate hereunder, such Employee shall complete such form and file it with
his or her Sponsoring Employer not later than 15 days prior to a Commencement
Date of a Plan Quarter. The completed Request for Participation shall indicate
the Participant Contribution Rate authorized by the Participant. If any Employee
does not elect to participate in the Plan during any given Plan Quarter, such
Employee may elect to participate on any future Commencement Date so long as he
or she continues to be an eligible Employee.
(b) On his or her Request for Participation, an Employee must
authorize his or her Sponsoring Employer to deduct through a payroll deduction
the amount of such Employee's Participant Contribution. The payroll deduction
specified in a Request for Participation for each payroll period shall be at a
Participant Contribution Rate no less than 1% and no more than 10% of such
Employee's Covered Compensation during such payroll period paid to him or her by
his or her Sponsoring Employer. Such deductions shall begin as of the first pay
period occurring after the Commencement Date of a Plan Quarter. Participant
Contributions will not be permitted to begin at any time other than on the first
payroll date occurring immediately after the Commencement Date of a Plan
Quarter. No interest shall accrue to Participants on any amounts withheld under
the Plan, unless and until the Committee shall approve such accrual of interest
on terms that it shall specify and apply on a uniform basis as to all
Participants.
(c) The Participant's Contribution Rate, once established, shall
remain in effect for all Plan Quarters unless changed by the Participant in
writing delivered to such Participant's Sponsoring Employer and filed with such
Sponsoring Employer at least 15 days prior to the Commencement Date of the next
Plan Quarter. A Participant's Contribution Rate for a Plan Quarter may not be
increased, decreased or otherwise modified at any time during the 15-day period
prior to the Commencement Date of such Plan Quarter.
(d) A Participant may notify his or her Sponsoring Employer of such
Participant's desire to discontinue his or her Participant Contributions by
delivering to his or her Sponsoring Employer written notice on such forms as may
be provided by the Company or such Participant's Sponsoring Employer at least 15
days prior to the Purchase
<PAGE> 5
Date of the relevant Plan Quarter. Upon such request, there shall be promptly
refunded to such Participant as soon as practicable the entire cash balance in
his or her Contribution Account. If a Participant determines to discontinue his
or her Participant Contributions pursuant to this Section 3.05(d), (i) such
Participant shall be terminated from the Plan effective upon the date of receipt
of such Participant's notice to his or her Sponsoring Employer and (ii) such
Participant shall not be permitted to be a Participant in the Plan for the
remainder of the calendar year of the Company in which such notice is received.
In the event that a Participant's payroll deductions are prevented by legal
process, the Participant will be deemed to have terminated from the Plan.
(e) By enrolling in the Plan, each Participant will be deemed to
have authorized the establishment of a brokerage account in his or her name at a
securities brokerage firm or other financial institution, if approved by the
Committee in its discretion.
3.04 Termination of Employment. Any Participant (i) whose employment
by a Sponsoring Employer is terminated for any reason (except death, retirement
or Permanent Disability) or (ii) who shall cease to be an Employee under the
Plan, in either case during a Plan Quarter, shall cease being a Participant as
of the date of such termination of employment. Upon such termination of
employment, there shall be refunded to such Participant as soon as practicable
the entire cash balance in such Participant's Contribution Account. Section
4.03(b) hereof shall apply to the issuance of certificates to a Participant
following termination of employment.
3.05 Death, Retirement or Permanent Disability
(a) If a Participant shall die during a Plan Quarter, no further
Participant Contributions on behalf of the deceased Participant shall be made.
The executor or administrator of the deceased Participant's estate may elect to
withdraw the balance in said Participant's Contribution Account by notifying the
deceased Participant's Sponsoring Employer in writing at least 15 days prior to
the Purchase Date in respect of such Plan Quarter. In the event no election to
withdraw has been made, the balance accumulated in the deceased Participant's
Contribution Account shall be used to purchase shares of Common Stock in
accordance with Article IV hereof.
(b) If, during a Plan Quarter, a Participant shall (i) retire or
(ii) incur a Permanent Disability, no further contributions on behalf of the
retired or disabled Participant shall be made. A retired or disabled Participant
may elect to withdraw the balance in his or her Contribution Account by
notifying the Sponsoring Employer in writing at least 15 days prior to the last
day of the Plan Quarter. In the event no election to withdraw has been made, the
balance accumulated in the retired or disabled Participant's Contribution
Account shall be used to purchase shares of Common Stock in accordance with
Article IV hereof. In the event a retired or disabled Participant shall die
during the Plan Quarter of such Participant's retirement or disability and such
Participant shall not have notified his or her Sponsoring Employer of his or her
desire to withdraw his or her Contribution Account, the executor or
administrator of such Participant's estate shall have all the rights provided
pursuant to Section 3.05(a) hereof.
<PAGE> 6
ARTICLE IV
PURCHASE OF COMMON STOCK
4.01 Purchase of Common Stock.
(a) On each Purchase Date, each Participant's Contribution Account
shall be used to purchase the maximum number of whole shares of Common Stock
determined by dividing (i) the Participant's Contribution Account as of such
Purchase Date by (ii) the Purchase Price in respect of such Plan Quarter. Any
amounts remaining in a Participant's Contribution Account after such
Participant's purchase of Common Stock in respect of a Plan Quarter may be
returned to such Participant if requested in writing. If such return is not
requested, the balance (representing amounts which would purchase only
fractional shares) will remain in such Participant's Contribution Account to be
used in the next Plan Quarter along with new Participant Contributions in such
succeeding Plan Quarter.
(b) If, in any Plan Quarter, the total number of shares of Common
Stock to be purchased pursuant to the Plan by all Participants exceeds the
number of shares authorized under the Plan, then each Participant shall purchase
his or her pro rata portion of the shares of Common Stock remaining available
under the Plan based on the balances in each Participant's Contribution Account
as of the Purchase Date in respect of such Plan Quarter; provided, however,
that, in no event, shall any fractional shares of Common Stock be issued
pursuant to the Plan or this Section 4.01(b) hereof.
(c) Any cash dividends paid with respect to shares of Common Stock
held for the account of a Participant shall be, as determined by the Committee
on a uniform basis as to all Participants, either (i) distributed to the
Participant or (ii) credited to the Participant's Contribution Account and used,
in the same manner as payroll deductions, to purchase additional shares of
Common Stock under the Plan on the next Purchase Date (subject to the
limitations of Section 3.02 hereof).
4.02 Purchase Price. For each Plan Quarter, the Purchase Price per
share of Common Stock purchased pursuant to the Plan shall be the lesser of (a)
85% of the Closing Market Price on the Commencement Date of such Plan Quarter,
and (b) 85% of the Closing Market Price on the Purchase Date of such Plan
Quarter.
4.03 Notice of Purchase, Stock Certificates, Voting Rights.
(a) After the Purchase Date in respect of each Plan Quarter, a
report will be made by the Company or its agent to each Participant stating the
entries made to his or her Contribution Account, the number of shares of Common
Stock purchased and the applicable Purchase Price.
<PAGE> 7
(b) Evidence of shares of Common Stock purchased under the Plan
shall be maintained under the Plan for the account of each Participant and
registered in the manner determined by the Committee. Certificates for the
number of whole shares credited to a Participant's account under the Plan will
be issued to a Participant at any time promptly upon written request to the
Company or its agent; provided, however, that the Company may, at its election,
issue such certificates at such time or times as the Committee deems
appropriate, including, without limitation, following an Employee's termination
of employment with a Sponsoring Employer.
(c) Shares of Common Stock held under the Plan for the account of
each Participant shall be voted by the holder of record of such shares in
accordance with the Participant's instructions.
4.04 Notification of Disposition of Stock. If a Participant or
former Participant disposes of a share of Common Stock purchased under the Plan
prior to two (2) years after the Commencement Date of the Plan Quarter during
which such share was purchased, then such Participant or former Participant
shall notify his or her Sponsoring Employer immediately of such disposition in
writing.
ARTICLE V
MISCELLANEOUS PROVISIONS
5.01 Shares Subject to Plan; Adjustments.
(a) The maximum number of shares of Common Stock which may be
purchased under the Plan is 1,500,000 subject, however, to adjustment as
hereinafter set forth. The shares of Common Stock to be purchased under the Plan
will be made available, at the discretion of the Board of Directors or the
Committee, either from authorized but unissued shares of Common Stock or from
previously issued shares of Common Stock reacquired by the Company, including
shares purchased on the open market.
(b) If the outstanding shares of Common Stock of the Company are
increased, decreased, or exchanged for a different number or kind of shares or
other securities, or if additional shares or new or different shares or other
securities are distributed with respect to such shares of Common Stock or other
securities, through merger, consolidation, spin off, sale of all or
substantially all the property of the Company, reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split or other
distribution with respect to such shares of Common Stock, or other securities,
an appropriate and proportionate adjustment may be made in the maximum number
and kind of shares provided in Section 5.01(a) hereof, subject in the case of
certain corporate reorganizations to the requirements of Section 424(a) of the
Code.
<PAGE> 8
5.02 Administration of the Plan.
(a) Pursuant to the direction of the Board of Directors, the
Committee shall be responsible for the administration of the Plan. The Committee
shall have the discretionary authority to interpret the Plan and determine all
questions arising in the administration, application and operation of the Plan,
including all questions of fact and all questions of interpretation of the
provisions of the Plan. All such determinations by the Committee shall be
conclusive and binding on all persons. The Committee, from time to time, may
adopt, amend and rescind rules and regulations not inconsistent with the Plan
for carrying out the Plan, and may approve the forms of any documents or
writings provided for in the Plan. The Committee shall have full discretionary
authority to delegate ministerial functions of the Plan to employees of the
Company. No member of the Board of Directors or the Committee shall be liable
for any action, determination or omission taken or made in good faith with
respect to the Plan or any right granted hereunder.
(b) The Committee may in its discretion engage a bank trust
department, securities brokerage firm or other financial institution as agent to
perform custodial and record-keeping functions for the Plan, such as holding
record title to the Participants' stock certificates, maintaining an individual
investment account for each Participant and providing periodic account status
reports to Participants.
(c) The Committee shall have the authority to adopt and enforce such
special rules and restrictions under the Plan to be applicable to Participants
who are subject to Section 16 of the Securities Exchange Act of 1934, as
amended, as the Committee shall deem are necessary or appropriate to exempt
certain Plan transactions from the requirements of such Section 16.
(d) The Company shall bear the cost of administering the Plan,
including any fees, costs and expenses relating to the purchase of shares of
Common Stock under the Plan. Notwithstanding the foregoing, Participants will be
responsible for all fees, costs and expenses incurred in connection with the
disposition of shares of Common Stock purchased under the Plan.
5.03 Termination and Amendment of the Plan.
(a) The Company may, by action of the Board of Directors, terminate
the Plan at any time and for any reason. The Plan shall automatically terminate
upon the purchase by Participants of all shares of Common Stock subject to the
Plan under Section 5.01 hereof, unless such number of shares shall be increased
by the Board of Directors and such increase shall be approved by the
shareholders of the Company. Upon termination of the Plan, as soon as
practicable, there shall be refunded to each Participant the entire cash balance
in his or her Contribution Account, and there shall be forwarded to each
Participant certificates for all whole shares of Common Stock held under the
Plan for the account of such Participant.
<PAGE> 9
(b) The Board of Directors reserves the right to modify, alter or
amend the Plan at any time and from time to time to any extent that it may deem
advisable, including, without limiting the generality of the foregoing, any
amendment deemed necessary to ensure compliance of the Plan with Section 423 of
the Code. Notwithstanding the foregoing, no amendment of the Plan shall operate
to reduce any amounts previously allocated to a Participant's Contribution
Account nor to reduce a Participant's rights with respect to shares of Common
Stock previously purchased and held on his or behalf under the Plan. The Board
of Directors may suspend operation of the Plan for any period as it may deem
advisable.
5.04 Governing Law; Compliance With Law. The Plan shall be construed
in accordance with the laws of the State of New York. The Company's obligation
to sell and deliver shares of Common Stock hereunder shall be subject to all
applicable federal and state laws, rules and regulations and to such approvals
by any regulatory or governmental agency as may, in the opinion of counsel for
the Company, be required. The Company may make such provisions as it may deem
appropriate for the withholding of any taxes or payment of any taxes which it
determines it may be required to withhold or pay in connection with a
Participant's participation in the Plan.
5.05 No Assignment. The purchase rights granted hereunder are not
assignable or transferable by the Participants, other than by will or the laws
of descent and distribution, and are exercisable during the Participant's
lifetime only by the Participant. Any attempted assignment, transfer or
alienation not in compliance with the terms of the Plan shall be null and void
for all purposes and respects.
5.06 No Contract of Employment. The Plan will not be deemed to
constitute a contract between a Sponsoring Employer and any Participant or to be
a consideration or an inducement for the employment of any Participant or
Employee. Nothing contained in the Plan shall be deemed to give any Participant
or Employee the right to be retained in the service of a Sponsoring Employer or
to interfere with the right of a Sponsoring Employer to discharge any
Participant or Employee at any time regardless of the effect which such
discharge shall have upon him or her as a Participant of the Plan.
5.07 No Rights as Stockholder. No eligible Employee or Participant
shall by reason of participation in the Plan have any rights of a stockholder of
the Company until he or she acquires shares of Common Stock as herein provided.
<PAGE> 1
EXHIBIT 5
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, NY 10019
January 14, 1998
N2K Inc.
55 Broad Street
26th Floor
New York, New York 10004
Gentlemen:
On or about January 14, 1998, N2K Inc. (the "Company") will file with the
Securities and Exchange Commission its Registration Statement ("Registration
Statement") on Form S-8. The Registration Statement covers 1,500,000 shares of
Common Stock, par value $.001 per share (the "Common Stock"), that may be issued
by the Company in connection with the Company's 1996 Employee Stock Purchase
Plan (the "Plan").
With respect to the Company and shares of its Common Stock, we are of the
opinion that:
A. The Company is a corporation duly organized and validly existing under
the laws of the State of Delaware.
B. The 1,500,000 shares of Common Stock referred to above:
(i) are duly authorized; and
(ii) will be validly issued and outstanding, fully paid and
nonassessable upon issuance in accordance with the terms and subject to
the conditions of the Plan.
In arriving at the foregoing opinion, we have examined corporate records,
plans, agreements and other documents of the Company.
We consent to the use of this opinion as an exhibit to the Registration
Statement. In giving such consent, we do not admit that we come within the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933, as amended, or the Rules and Regulations of the Securities and
Exchange Commission thereunder.
Very truly yours,
/s/ Dewey Ballantine LLP
DEWEY BALLANTINE LLP
<PAGE> 1
EXHIBIT 23.2
[Letterhead of Arthur Andersen]
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
To N2K Inc.:
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement to our report dated October 16, 1997
included in N2K Inc.'s Prospectus, filed pursuant to Rule 424(b), dated October
17, 1997 (Registration Statement File No. 333-06603), and to all references to
our firm included in this registration statement.
ARTHUR ANDERSEN LLP
New York, New York
January 14, 1998
<PAGE> 1
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement on
Form S-8 dated January 14, 1998 of our report dated January 31, 1996, with
respect to Note F, February 13, 1996 on our audit of the financial statements of
N2K Inc. as of December 31, 1995 and for the period beginning March 7, 1995
(date of inception) through December 31, 1995 which appears in the Form S-1
Registration Statement dated October 17, 1997 of N2K Inc.
RICHARD A. EISNER & COMPANY, LLP
New York, New York
January 14, 1998
