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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT: SEPTEMBER 30, 1997
(Date of earliest event reported)
COMMISSION FILE NUMBER 0-14713
[LOGO]
INTERLEAF, INC.
(exact name of registrant as specified in its charter)
Massachusetts 04-2729042
(State or other jurisdiction (I.R.S. employer
of incorporation or organization) identification number)
62 FOURTH AVENUE, WALTHAM, MA 02154
(Address of principal executive offices) (Zip Code)
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INTERLEAF, INC.
ITEM 5. OTHER EVENTS
1997 PRIVATE PLACEMENT
On September 30, 1997, Interleaf, Inc. (the "Company") completed a private
placement transaction pursuant to which it received aggregate net proceeds
of approximately $6.8 million (after cash fees to the placement agent and
estimated transaction expenses) from the issuance of shares of the
Company's 6% Convertible Preferred Stock ("Convertible Preferred Stock")
and related placement agent warrants. Such transaction is referred to in
this Form 8-K as the "1997 Private Placement," and the related securities
issuances (including shares of the Company's Common Stock ("Common Stock")
issuable upon the conversion of shares of Convertible Preferred Stock, as
dividends thereon and upon exercise of the placement agent warrants) are
referred to as the "1997 Private Placement Issuances." All of the
securities sold in the 1997 Private Placement were sold in a private
placement solely to accredited investors. The offering is complete and all
shares of Convertible Preferred Stock have been placed.
Certain provisions relating to the conversion of the Convertible Preferred
Stock allow for their conversion at prices discounted to the trading
price from time to time of the Common Stock on the Nasdaq Stock Market,
Inc. ("Nasdaq") national market. Upon such conversion, these provisions
will result in dilution to holders of outstanding shares of Common Stock.
However, under the terms of the Convertible Preferred Stock, no
conversion of the Convertible Preferred Stock into Common Stock is
permitted for a period of 90 days from and after the closing of the 1997
Private Placement on September 30, 1997, so that no such dilution can
take place for at least this period.
SUBSEQUENT FILINGS
In accordance with Exchange Act Release No. 37801 (October 10, 1996), the
Company will make the disclosures required under Item 701 of Regulation S-K
in its quarterly report on Form 10-Q to be filed on or before November 14,
1997.
COMMUNICATIONS WITH NASDAQ
In letters dated September 5, 1997 and September 25, 1997, Nasdaq informed
the Company that in order to prevent delisting the Company would need to
complete the 1997 Private Placement and file this Form 8-K demonstrating
compliance with Nasdaq Marketplace Rule 4450(a)(3)(C) using pro-forma
information with June 30, 1997 as the base on or prior to October 1, 1997.
As a result of the 1997 Private Placement, the Company is able to
demonstrate such pro-forma compliance as shown in the financial statements
included under Item 7 of this Form 8-K. Thus, the Common Stock of the
Company will continue to be listed on the Nasdaq National Market from and
after October 1, 1997 on the same basis as previously.
The Company has made the following commitments to Nasdaq in connection with
such continued listing:
S The Company will seek stockholder approval of the 1997 Private
Placement in a special meeting to be held not more than 90 days
after the closing of the transaction.
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S The Company will reserve $1 million dollars from the proceeds of
the 1997 Private Placement for a period of 18 months after the
closing to be used solely for purposes of funding the "Green
Floor" which permits the Company to make cash payments in lieu of
certain 1997 Private Placement Issuances. The Company will use
the full $1 million to exercise the "Green Floor" in order to
prevent to the extent possible dilution equaling or exceeding 20%
of the total shares of Common Stock outstanding prior to
completion of the 1997 Private Placement.
S Common Stock issued upon the conversion of the Convertible
Preferred Stock will not be allowed to vote in the shareholder
vote on the 1997 Private Placement.
STOCKHOLDER APPROVAL
The Company intends to seek stockholder approval of the 1997 Private
Placement at a special meeting called solely for this purpose to be held at
the Company's principal executive offices at 62 Fourth Avenue, Waltham,
Massachusetts on or about November 15, 1997. The record date for this
special meeting has been set at October 15, 1997.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits.
Exhibit No. Exhibit
99 Pro Forma Balance Sheet of the Company, at June 30, 1997,
including the 1997 Private Placement.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company
has duly caused this report on Form 8-K to be signed on its behalf by the
undersigned hereunto duly authorized.
INTERLEAF, INC.
September 30, 1997
/s/ Jaime W. Ellertson
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Jaime W. Ellertson
President
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Exhibit 99
Interleaf, Inc.
Consolidated Balance Sheets
(In thousands)
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JUNE 30, 1997 PROFORMA
ADJUSTMENTS JUNE 30, 1997
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ASSETS (UNAUDITED) (UNAUDITED)
Current Assets
Cash and cash equivalents.............................................. $ 18,031 $ 6,848 $ 24,879
Accounts receivable, net of reserve for doubtful accounts 7,922
of $1,377 at June 30, 1997............................................. 7,922 0
Prepaid expenses and other current assets.............................. 1,532 1,532
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Total Current Assets................................................... 27,485 6,848 34,333
Property and equipment, net............................................ 4,423 4,423
Intangible assets...................................................... 1,946 1,946
Other assets........................................................... 444 444
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Total Assets........................................................... 34,298 6,848 41,146
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LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts payable....................................................... 2,544 703 3,247
Accrued expenses....................................................... 11,845 11,845
Unearned revenue....................................................... 13,819 13,819
Accrued restructuring.................................................. 3,598 3,598
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Total Current Liabilities.............................................. 31,806 703 32,509
Long-term restructuring................................................ 2,744 2,744
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Total Liabilities...................................................... 34,550 703 35,253
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Shareholders' Equity (Deficit)
Preferred stock, par value $.10 per authorized 5,000,000 shares:
Series A Junior Participating, none issued and outstanding
Senior Series B convertible, issued and outstanding, 861,911 at
June 30, 1997........................................................ 86 86
Senior Series C convertible, issued and outstanding, 1,006,480 at June
30, 1997; 1,013,980 issued and outstanding (proforma)................ 101 -- 101
Common stock, par value $.01 per share, authorized 30,000,000 shares,
issued and outstanding, 17,709,719 at June 30, 1997.................. 177 177
Additional paid-in capital............................................. 85,747 6,145 91,892
Retained earnings(deficit)............................................. (86,122) (86,122)
Cumulative translation adjustment...................................... (241) (241)
0
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Total Shareholders' Equity (Deficit)................................... (252) 6,145 5,893
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Total Liabilities and Shareholders' Equity (Deficit)................... $ 34,298 $ 6,848 $ 41,146
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