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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of Report (Date of earliest event reported): December 6, 2000 (November 22, 2000)
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Verso Technologies, Inc.
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(Exact name of registrant as specified in its charter)
Minnesota 0-22190 41-1484525
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(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification
incorporation) Number)
400 Galleria Parkway, Suite 300, Atlanta, Georgia 30326
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (678) 589-3500
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Item 2. Acquisition or Disposition of Assets.
On November 22, 2000, Verso Technologies, Inc., a Minnesota corporation
(the "Company"), consummated the merger (the "Merger") of MCLICK Acquisition
Corporation, a Delaware corporation and a second-tier, wholly-owned subsidiary
of the Company ("MCLICK"), with and into MessageClick, Inc., a Delaware
corporation ("MessageClick"), whereby MessageClick became a second-tier,
wholly-owned subsidiary of the Company pursuant to that certain Agreement and
Plan of Merger dated as of October 31, 2000 by and among the Company, MCLICK and
MessageClick, as amended by the First Amendment thereto dated as of November 9,
2000, and as further amended by the Second Amendment thereto dated as of
November 10, 2000 (as so amended, the "Merger Agreement").
Pursuant to the Merger Agreement, the issued and outstanding shares of
MessageClick's preferred stock, designated as Series A Preferred Stock, Series B
Preferred Stock, Series C Preferred Stock, and Series D Preferred Stock, each
with a par value of $.01 per share ("Preferred Stock"), other than the shares of
Preferred Stock with respect to which dissenters' rights have been perfected and
the shares of Preferred Stock held by the Company, its subsidiaries, or
MessageClick, were converted into the right to receive the following: (i) an
aggregate of 1,191,341 shares of the Company's common stock, par value $.01
("Common Stock") (248,139 shares of which are being held in escrow to satisfy
certain indemnification claims that the Company may make), plus cash in lieu of
any fractional shares; (ii) cash consideration in an aggregate amount of $5,000;
and (iii) warrants to purchase an aggregate of 177,901 shares of Common Stock,
which warrants may be exercised from time to time at any time after their
issuance until November 22, 2005 at an initial exercise price of $4.03 per share
(together with the consideration described in clauses (i) and (ii), the "Merger
Consideration"). In addition, the Company issued 214,582 shares of Common Stock
to satisfy certain amounts owing by MessageClick. In accordance with
MessageClick's certificate of incorporation, none of the outstanding shares of
common stock of MessageClick was entitled to receive any portion of the Merger
Consideration, and, hence, such shares were cancelled by operation of law upon
the consummation of the Merger pursuant to the terms of the Merger Agreement.
Pursuant to the Registration Rights Agreement dated November 22, 2000,
between the Company and the holders of the Preferred Stock entitled to receive
the Merger Consideration, the Common Stock issued and issuable in connection
with the Merger is entitled to certain "piggy-back" registration rights.
In addition, the holders of the Preferred Stock entitled to receive the
Merger Consideration may receive (i) an aggregate of $3,000,000 payable in
shares of Common Stock if the MessageClick business achieves certain revenue
levels for the calendar year ending December 31, 2001; and (ii) an aggregate of
179,901 shares of Common Stock if the Company receives certain investment
commitments by no later than December 31, 2000 (collectively, the "Contingent
Consideration").
The Merger Consideration and the Contingent Consideration were
determined as a result of negotiations between the Company and MessageClick, and
the Merger was approved by the boards of directors of the Company, MessageClick
and MCLICK and by the stockholders of
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MessageClick. Prior to the Merger, neither the Company nor any of its
affiliates, directors or officers, nor any associate of any such director or
officer, had any relationship with MessageClick, except that the Company
purchased 3,000,000 shares of MessageClick's Series E Preferred Stock for an
aggregate purchase price of $1,800,000 prior to the Merger. In addition, on
November 10, 2000, the Company loaned MessageClick $200,000 pursuant to a 90-day
promissory note.
The description contained herein of the Merger Agreement is qualified
in its entirety by reference to the full text of the Merger Agreement and the
amendments thereto which have been filed as Exhibits 2.1, 2.2 and 2.3 to this
Report.
The securities issued in connection with the Merger were issued without
registration under the Securities Act of 1933, as amended (the "Securities
Act"), in reliance upon the exemption in Section 4(2) of the Securities Act.
Item 5. Other Events
On November 22, 2000, the Company issued and sold to certain investors
the Company's 7.50% Convertible Debentures in an aggregate principal amount of
$4,500,000 due November 22, 2005 (the "Debentures") and warrants to purchase up
to 1,000,000 shares of Common Stock (the "Warrants") pursuant to that certain
Convertible Debenture and Warrant Purchase Agreement (the "Purchase Agreement")
dated as of October 31, 2000 between the Company and the investors signatory
thereto (each such investor is a "Purchaser" and all such investors are,
collectively, the "Purchasers").
The Debentures obligate the Company to pay the principal amount of
$4,500,000 by November 22, 2005, or at such earlier time as the Debentures are
required or permitted to be repaid pursuant to their terms, and interest on the
unpaid principal amount at a rate of 7.50% per annum, payable in arrears. The
Debentures may be converted, at the option of the holder of such Debenture or,
under certain circumstances, the Company into shares of Common Stock at an
initial conversion price of $4.50, subject to adjustment according to the terms
of the Debentures.
Each Purchaser also purchased a Warrant to purchase a number of shares
of Common Stock initially equal to the initial number of shares of Common Stock
into which such Purchaser's Debenture is convertible. Each Warrant is
immediately exercisable at an initial exercise price of $7.50 per share of
Common Stock (subject to adjustment according to the terms of the Warrants) and
terminates on November 22, 2005.
Pursuant to the Registration Rights Agreement dated as of November 22,
2000, between the Company and the Purchasers, the shares of Common Stock
issuable or issued upon the conversion of the Debentures and the Warrants are
entitled to certain "piggy-back" registration rights.
The description contained herein of the Purchase Agreement, the
Debentures, the Warrants and the Registration Rights Agreement is qualified in
its entirety by reference to the full text of such documents which are filed as
Exhibits 4.4, 4.5, 4.6 and 4.7 to this report.
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The securities issued pursuant to the Purchase Agreement were issued
without registration under the Securities Act in reliance upon the exemption in
Rule 506 of Regulation D promulgated pursuant to Section 4(2) of the Securities
Act.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) - (b) Financial Statements and Pro Forma Financial Information. All
required financial statements and pro forma financial information will be filed
by amendment to this Report not later than sixty (60) days after the due date of
this Report.
(c) Exhibits.
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2.1 Agreement and Plan of Merger dated October 31, 2000
between the Company, MessageClick and MCLICK (the
"Merger Agreement"). (Certain of the exhibits and
schedules to the Agreement and Plan of Merger have
been omitted from this Report pursuant to Item
601(b)(2) of Regulation S-K, and the Company agrees
to furnish copies of such omitted exhibits and
schedules supplementally to the Securities and
Exchange Commission upon request).
2.2 First Amendment to the Agreement and Plan of Merger
dated November 9, 2000 between the Company, MCLICK
and MessageClick.
2.3 Second Amendment to the Agreement and Plan of Merger
dated November 10, 2000 between the Company, MCLICK
and MessageClick.
4.1 Warrant issued in connection with the Merger
Agreement (the form of which is included as an
exhibit to Merger Agreement filed herewith).
4.2 Registration Rights Agreement entered into in
connection with the Merger Agreement (the form of
which is included as an exhibit to Merger Agreement
filed herewith).
4.3 Escrow Agreement entered into in connection with the
Merger Agreement (the form of which is included as an
exhibit to Merger Agreement filed herewith).
4.4 Convertible Debenture and Warrant Purchase Agreement
dated October 31, 2000 between the Company and the
Purchasers (the "Purchase Agreement").
4.5 7.5% Convertible Debenture issued in connection with
the Purchase Agreement (the form of which is included
as an exhibit to the Purchase Agreement filed
herewith).
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4.6 Warrant issued in connection with the Purchase
Agreement (the form of which is included as an
exhibit to the Purchase Agreement filed herewith).
4.7 Registration Rights Agreement entered into in
connection with the Purchase Agreement (the form of
which is included as an exhibit to the Purchase
Agreement filed herewith).
99.1 Press Release dated November 3, 2000.
99.2 Press Release dated November 24, 2000.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
VERSO TECHNOLOGIES, INC.
By: /s/ Juliet M. Reising
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Juliet M. Reising
Executive Vice-President and Chief
Financial Officer
Dated: December 6, 2000
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EXHIBIT INDEX
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2.1 Agreement and Plan of Merger dated October 31, 2000 between the
Company, MessageClick and MCLICK (the "Merger Agreement").
2.2 First Amendment to the Agreement and Plan of Merger dated November 9,
2000 between the Company, MCLICK and MessageClick.
2.3 Second Amendment to the Agreement and Plan of Merger dated November 10,
2000 between the Company, MCLICK and MessageClick.
4.1 Warrant issued in connection with the Merger Agreement (the form of
which is included as an exhibit to Merger Agreement filed herewith).
4.2 Registration Rights Agreement entered into in connection with the
Merger Agreement (the form of which is included as an exhibit to Merger
Agreement filed herewith).
4.3 Escrow Agreement entered into in connection with the Merger Agreement
(the form of which is included as an exhibit to Merger Agreement filed
herewith).
4.4 Convertible Debenture and Warrant Purchase Agreement dated October 31,
2000 between the Company and the Purchasers (the "Purchase Agreement").
4.5 7.5% Convertible Debenture issued in connection with the Purchase
Agreement (the form of which is included as an exhibit to the Purchase
Agreement filed herewith).
4.6 Warrant issued in connection with the Purchase Agreement (the form of
which is included as an exhibit to the Purchase Agreement filed
herewith).
4.7 Registration Rights Agreement entered into in connection with the
Purchase Agreement (the form of which is included as an exhibit to the
Purchase Agreement filed herewith).
99.1 Press Release dated November 3, 2000.
99.2 Press Release dated November 24, 2000.
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