<PAGE> 1
Registration No. 33 --
As filed with the Securities and Exchange Commission on January 2, 1996
___________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________________________________________________________________________
Form S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
INTERSYSTEMS, INC.
(Exact name of registrant as specified in its charter)
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<CAPTION>
<S> <C>
Delaware 13-3256265
-------------------------------- -----------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
</TABLE>
8790 Wallisville Road, Houston, Texas 77029 (713) 675-0307
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Fred S. Zeidman, President, InterSystems, Inc.
8790 Wallisville Road, Houston, Texas 77029 (713) 675-0307
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
With copies to:
Clare J. Attura, Esq., 537 Steamboat Road, Greenwich, CT 06830
Approximate date of commencement of proposed sale to the public: From time to
time after the Registration Statement becomes effective.
If any of the securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 (the "Act"), other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Act, please check the following box and list
the Act registration statement number of the earlier registration statement for
the same offering. [ ] ______________
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Act, check the following box and list the Act registration statement number
of the earlier effective registration statement for the same offering. [ ]
____________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
<PAGE> 2
CALCULATION OF REGISTRATION FEE
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================================================================================================
Title of Each Proposed Proposed
Class of Maximum(1) Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Unit Price Fee
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
par value $.01
per share 420,000(2) $ 2.125(3) $892,500 $307.76
================================================================================================
</TABLE>
(1) Estimated solely for purposes of calculation of the registration fee.
(2) The aggregate number of securities registered hereunder includes 275,000
shares of Common Stock which have been authorized and reserved for issuance
pursuant to the Warrants (as hereinafter defined). Pursuant to Rule 416
promulgated under the Securities Act of 1933, as amended (the "Act"), this
Registration Statement covers such additional shares of Common Stock to be
offered or issued to prevent dilution as a result of future stock splits, stock
dividends or similar transactions.
(3) Pursuant to Rule 457(c) and (g), the offering price is based upon the
average of the high and low prices reported on the American Stock Exchange on
December 26, 1995 (being within 5 business days prior to the date of the filing
of this registration statement).
-------------------
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
<PAGE> 3
PROSPECTUS
INTERSYSTEMS, INC.
________________________________________
420,000 Shares of Common Stock
________________________________________
This Prospectus relates to the offer and sale of 420,000 shares of
common stock (the "Securities") of InterSystems, Inc. (the "Company"), $.01 par
value per share (the "Common Stock") as follows:
275,000 shares issuable upon exercise of the Company's Common Stock
Purchase Warrants expiring June 30, 2000 (the "Warrants");
20,000 shares sold by the Company in a private placement to two
employees (the "Employees") at a price of $1.25 per share, being the
closing price of the Common Stock on the American Stock Exchange (the
"AMEX") on September 8, 1995, the date of the sale; and
125,000 shares held by Helm Resources, Inc. ("Helm"), the holder of
36% of the Company's Common Stock (the "Helm Shares").
The Warrants are exercisable at $1.50 per share commencing on the
later of (i) January 15, 1996 or (ii) such date as the shares underlying the
Warrants are approved for listing on the AMEX, and are redeemable by the
Company at a price of $.05 per warrant, upon not less than 30 days' prior
notice, if the closing sales price of the Common Stock (as reported by the
AMEX) has been at least 200% of the then effective exercise price on each of 20
consecutive trading days at a time when the shares of Common Stock issuable
upon exercise of the Warrants are registered under the Securities Act of 1933,
as amended (the "Act"). The Company is contractually obligated to register the
shares underlying the Warrants by the end of 1995, or as soon thereafter as
possible.
<PAGE> 4
The Securities being offered hereby are being offered to permit the
issuance of registered stock upon the exercise of the Warrants. Additionally,
the Securities offered by the Selling Stockholders may be sold from time to
time by the Selling Stockholders, or by pledgees, transferees or other
successors in interest, on the AMEX (or such other exchange on which the
Securities are listed at the time of sale) in the over-the-counter market or
otherwise, at prices and at terms then prevailing or at prices related to the
then current market price, or in privately negotiated transactions.
Addtionally, this Prospectus has been prepared for use, with the prior
consent of the Company, by certain holders of the Warrants who will acquire
shares of Common Stock upon exercise and who may wish to sell such shares in
transactions in which they may (because of their relationship to the Company)
be deemed to be underwriters within the meaning of the Act.
This Prospectus also relates to such additional shares of Common Stock
which may be issuable pursuant to the anti-dilution provisions of the Warrants,
which shares are being registered pursuant to Rule 416 promulgated under the
Act.
Other than proceeds equal to the aggregate exercise price of Warrants
exercised, if any, the Company will not receive any proceeds from the sale of
Common Stock offered hereby. The Company's Common Stock is presently listed on
the AMEX under the symbol "II." The closing price for the Common Stock on the
AMEX on December 26, 1995 was $2.125.
_________________________________________
SEE "SPECIAL CONSIDERATIONS" FOR
CERTAIN MATTERS TO BE CONSIDERED BY PROSPECTIVE INVESTORS.
_________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
________________________________________
The date of this Prospectus is December 29, 1995.
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No person is authorized in connection with the offering made by this Prospectus
to give any information or to make any representations not contained or
incorporated by reference in this Prospectus, and any information or
representation not contained or incorporated by reference in this Prospectus
must not be relied upon as having been authorized by the Company. This
Prospectus is not an offer to sell, or a solicitation of an offer to buy, by
any person in any jurisdiction in which it is unlawful for that person to make
an offer or solicitation. Neither the delivery of this Prospectus or any sale
made under this Prospectus shall, under any circumstance, create any
implication that the information in this Prospectus is correct as of any time
subsequent to the date of this Prospectus.
AVAILABLE INFORMATION
InterSystems, Inc. (the "Company") is subject to the informational requirements
of the Securities Exchange Act of 1934 (the "1934 Act") and, in accordance
therewith, files reports, proxy and information statements and other
information with the Securities and Exchange Commission ( the "Commission").
Such reports, proxy and information statements and other information can be
inspected and copied at the public reference facilities maintained by the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549;
and at the regional offices of the Commission at: Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and 7 World Trade
Center, Suite 1300, New York, New York 10001. Copies of such material can be
obtained from the Public Reference Section of the Commission, in Washington,
D.C. at prescribed rates. In addition, the Common Stock is listed on the
American Stock Exchange, 86 Trinity Place, New York, N.Y. 10006, and reports,
proxy and information statements and other information can be inspected at the
offices of the Exchange.
-----------------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company incorporates by reference into this Prospectus the following
documents and portions of documents:
1. The Company's Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1994.
2. The Company's Quarterly Reports on Form 10-QSB for the fiscal quarters
ended March 31, 1995, June 30, 1995 and September 30, 1995.
3. The Company's Report on Form 8-K dated December 11, 1995.
4. All other reports filed pursuant to Section 13(a) or Section 15(d) of
the 1934 Act since the date of this Prospectus.
5. The definitive Proxy Statement of the Company date June 1, 1995,
relating to the Annual Meeting of Shareholders.
6. A description of the Common Stock as set forth in Registration
Statement Form 8-A filed with the Commission on February 2, 1987.
<PAGE> 6
All other reports filed pursuant to Section 13(a), 13(c), 14 or 15(d)
of the 1934 Act prior to the termination of this offering shall be deemed to be
incorporated by reference in this Prospectus and to be a part of this
Prospectus from the date of filing thereof.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, upon written or oral request of that person, a copy of
all other documents incorporated by reference into the Registration Statement
of which this Prospectus is a part, other than exhibits to those documents.
Requests should be directed to Daniel T. Murphy, InterSystems, Inc., 11 Penn
Plaza, Suite 1002, New York, New York 10001 (telephone: (212) 268-5545).
-----------------------
THE COMPANY
The Company is engaged in the design, manufacture and sale of
specialized materials handling equipment and in providing custom compounding
services for resin producers.
The Company's two principal lines of business today consist of the
operations of its wholly-owned subsidiary, InterSystems, Inc., a Nebraska
corporation ("InterSystems Nebraska"), which designs, manufactures and sells
specialized materials handling equipment, and the custom resin compounding
operations conducted by its wholly-owned subsidiary, CHEMTRUSION, INC.
("Chemtrusion"). For each of the two years ended December 31, 1994,
approximately 75% of the Company's revenues were attributable to the business
of InterSystems Nebraska and approximately 25% of the Company's revenues were
attributable to the business of Chemtrusion.
InterSystems, Inc. was organized under the laws of the state of
Delaware in 1984. As used herein, "Company" refers to InterSystems, Inc. and
its subsidiaries, unless the context indicates otherwise. The Company's
principal executive offices are located at 8790 Wallisville Road, Houston,
Texas 77029 and its telephone number at that location is (713) 675-0307.
SPECIAL CONSIDERATIONS
All prospective investors should consider carefully, among other
things, the following factors before purchasing any securities offered hereby:
RECENT OPERATING LOSSES; LIMITED CAPITAL. For the years ended December
31, 1993 and 1994, the Company had losses from continuing operations of
$154,000 and $732,000, respectively, after a non-recurring loss at InterSystems
Nebraska in 1994 of $495,000. In the third quarter
<PAGE> 7
of 1994, InterSystems Nebraska provided a $300,000 special charge for damage to
conveying equipment resulting from a harmonic vibration which developed after
installation of two en-masse conveyors built for one of its customers. A
subsequent additional charge of $195,000 was recorded in the fourth quarter of
1994. These costs were one-time charges. The company has built similar
conveyors before and has never encountered a similar problem either during
product testing or after installation. Absent the $495,000, net loss for the
twelve months ended December 31, 1994 would have been $237,000.
The Company had a loss from continuing operations of $159,000 for the
first nine months of 1995,as compared to a net loss of $190,000 for the
comparable period in 1994, which included a one-time overseas sale of $850,000
in the first quarter of 1994. At September 30, 1995, the Company had working
capital of $(184,000) and a cash balance of approximately $39,000. However,
the Company recorded net income from continuing operations of $59,000 for the
three months ended September 30, 1995,as compared to a net loss of $240,000 for
the comparable period in 1994. The recent history of losses subjects the
Company to a number of risks, including limited access to capital, uncertain
markets and competition. There can be no assusrance that the Company's
existing capital and cash flow from operations will be sufficient to meet
working capital needs in the future should operating losses continue, nor can
there be any assurance that the Company will be profitable in the future.
Capital may be needed by the Company to call the warrants, or to
redeem the units offered in the Company's December 1995 private placement in
accordance with the terms of those securities. Assuming 25 units are purchased
in that placement, the maximum amount required to call the warrants will be
$25,000 (although $900,000 will be realized by the Company assuming that all of
the warrants, once called, will be exercised), and the maximum amount required
to redeem all the Common Stock comprising the units will be $1,800,000. Should
the Company decide to call the warrants, or should the holders of Units require
the Company to redeem the units, the Company may be required to undertake a
financing to raise sufficient capital to complete any such call or redemption.
No assurance can be given that the Company will be able to successfully
complete such a financing or otherwise raise the necessary funds.
CONTROL BY HELM RESOURCES, INC. Helm Resources, Inc. ("Helm")
currently owns approximately 36% of the Common Stock, effectively giving Helm
the ability to elect all of the directors of the Company and thus control the
management and affairs of the Company. Four officers and directors of Helm,
who are also officers and directors of the Company, in the aggregate own
approximately another 6.8% of the Common Stock. Such a concentration of
effective voting power and control could serve to perpetuate management. The
overlap of directors of the both companies creates inherent conflicts of
interests. For example, in connection with the possible acquisition of
Interpak Holdings, Inc. from Helm, this transaction and other similar
transactions may indirectly benefit directors and officers of the Company who
are also directors, officers and security holders of Helm, although the Board
of Directors of the Company has recently elected Mr. William Lurie and Mr.
Leonard Friedman as independent directors to the Board, and has appointed
<PAGE> 8
Mr. Lurie Chairman of the Acquisition Committee which will evaluate and
negotiate the possible acquisition. In addition, Interpak Holdings, Inc.
provides management services to the Company. The allocated expenses for such
management services, based on certain formulas which management deems to be
reasonable, amounted to $36,000 and $124,000 for 1994 and 1993. These expenses
have continued during 1995, and are expected to continue in the future.
RELIANCE ON KEY PERSONNEL. Mr. Scott Owens, President of Chemtrusion,
is integral to the operation of that subsidiary, and at the present time that
company does not have in place an assistant to Mr. Owens who could assume his
responsibilities should Mr. Owens leave the employ of the Company or otherwise
be unable to perform his duties.
CUSTOMER DEPENDENCE. During 1994 and the first nine months of 1995,
one customer, Montell U.S.A., Inc., accounted for approximately 80% and 75%,
respectively, of Chemtrusion's revenues and 20% of the Company's revenues. The
loss of this customer would have a material adverse effect on the compounding
business and the Company's revenues, and there can be no assurance that
Chemtrusion could fill the production capacity resulting from such loss.
MARKET FOR THE COMMON STOCK; SHARES ELIGIBLE FOR FUTURE SALE. The
Common Stock is currently traded on the American Stock Exchange. However,
there is no assurance that an active trading market in the Common Stock will
continue. Accordingly, no assurance can be given that a holder of the Common
Stock will be able to sell the Common Stock in the future or as the price at
which the Common Stock might trade. The liquidity of the market will depend
upon the number of holders thereof, the interest of the securities dealers in
making a market in the Common Stock and other factors beyond the Company's
control.
There are currently 4,361,846 shares of Common Stock outstanding. In
addition, 1,945,611 shares of Common Stock are or will become issuable upon
conversion of outstanding debentures, 1,552,352 shares of Common Stock are
issuable upon exercise of warrants that are outstanding or reserved for
issuance, 325,000 shares of Common Stock are reserved for issuance under the
Company's employee stock option plan (121,228 of which are subject to currently
outstanding options) and 400,000 shares of Common Stock are issuable upon the
exercise of other outstanding options. The shares of Common Stock and shares
issuable upon conversion or exercise of other outstanding securities of the
Company will be eligible for immediate resale in the public market without
restriction. Future sales of substantial amounts of Common Stock in the public
market following this offering could adversely affect the market price of the
Common Stock. It is anticipated that a significant amount of Common Stock
would be issued to Helm in connection with the possible purchase of Interpak
Holdings.
DIVIDEND POLICY. The Company has not paid any cash dividends during
the past several years. The Company currently intends to retain all of its
earnings to support the development of its business and does not anticipate
paying any cash dividends for the forseeable future. Furthermore, InterSystems
Nebraska is a party to a credit and security agreement providing for a
revolving line of credit up to $1.45 million which prohibits the declaration or
payment of cash dividends by InterSystems Nebraska. This prohibition has the
practical effect or restricting the payment of dividends on the Company's
common stock.
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ANTI-TAKEOVER PROVISIONS. The Company's Certificate of Incorporation
and By-Laws include provisions that may have the effect of delaying or
preventing a change in control of the Company. The Company's Certificate of
Incorporation authorizes the issuance of up to 5,000,000 shares of preferred
stock. As a result, the Board of Directors could, without stockholder
approval, issue preferred stock with voting, liquidation preference, dividend
and other rights superior to those of the Common Stock. The issuance of such
preferred stock could adversely affect the voting power of holders of the
Common Stock and could be used to prevent a third party from acquiring control
of the Company. In addition, the Company's Certificate of Incorporation
provides for the Board of Directors to be divided into three classes of
directors serving staggered three year terms, with the number of directors in
each class to be as nearly equal as possible. The vote of two-thirds of the
outstanding shares of stock entitled to vote on the matter is required to
remove a director from office. A staggered board and the super majority vote
required for the removal of directors are additional factors which could make
it more difficult for stockholders to change control of the Company.
CONTINGENT LIABILITIES OF THE TRADING BUSINESS. In April 1993 the
Company completed the sale of its trading business to Bamberger Acquisition
Corp. ("BAC"), a newly formed Delaware corporation owned by six individuals who
were then members of the Company's senior management. In connection with the
sale, BAC did not assume all of the liabilities of the trading business. In
addition, with respect to those liabilities which were assumed, the Company
remains liable, together with BAC, to all secured and unsecured creditors
(including lessors), vendors and trade creditors of the trading business who
did not release the Company following consummation of the sale. As of Septmber
30, 1995, such contingent liabilities (which by such date consisted of lease
obligations only) were estimated to be approximately $715,000. In
circumstances where the Company has a continuing liability together with BAC
for such obligations, the Company would have a contractual right to
indemnification from BAC for any liabilities actually incurred. No assurance
can be given that such indemnity could be easily and quickly enforced by the
Company.
RECENT DEVELOPMENTS
The Company and its subsidiaries, InterSystems, Inc., a Nebraska
corporation ("InterSystems Nebraska") and Chemtrusion, Inc. ("Chemtrusion"),
have embarked on plans for major internal and external expansion, in the form
of new facilities and new product lines, which will have the effect of greatly
expanding manufacturing capacity and rounding out product lines to reduce the
effects of seasonality on product demand, as more fully described in the
Company's Current Report on Form 8-K dated December 11, 1995 as filed with the
Securities and Exchange Commission.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the
Securities by the Selling Stockholders hereby, except that it will receive the
aggregate exercise price of the Warrants, estimated to be approximately
$412,500. The shares of Common Stock underlying the Warrants are being
registered pursuant to a contractual obligation on the part of the Company to
register these shares to provide the holders thereof with freely tradable
Common Stock upon exercise. The Company does
<PAGE> 10
not know whether any of the Warrants will be exercised, and therefore has made
no specific plans to utilize the proceeds, if any, from such exercise. If any
Warrants are exercised, the Company intends to use the proceeds for general
corporate purposes.
SELLING STOCKHOLDERS
The following table provides information with respect to the name and
address of each Selling Stockholder (Column 1), the number and percentage of
shares of Common Stock held by each Selling Stockholder prior to the offering,
including shares which the Selling Stockholder has the right to acquire within
60 days (Column 2), the number of shares of Common Stock which are offered
hereby (Column 3) and the number and percentage of shares of Common Stock which
will be held by each Selling Stockholder after the offering, including shares
which the Selling Stockholder has the right to acquire within 60 days (Column
4). Because the Selling Stockholders may sell all or a portion of their Common
Stock offered hereby, and the fact that this offering is not being underwritten
on a firm commitment basis, the amount of securities that may be owned after
the offering assumes that the Selling Stockholders will offer and sell all of
the Common Stock offered for sale hereby and not acquire any other securities
issued by the Company.
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Shares/% Shares Shares/%
Name Beneficially Offered Benefically
and Owned Prior pursuant Owned After
Address to Offering(1) hereto Offering
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Helm Resources, Inc. 1,565,155/36.0% 125,000 1,440,155/33.0%
537 Steamboat Road
Greenwich, CT 06830
Chris Mathers(2)* 20,500/+ 16,000 1,500/+
Robert Moser(3)** 4,000/+ 4,000 -
</TABLE>
- --------------------
+ less than 1%
* c/o InterSystems, Inc., 8790 Wallisville Road, Houston, TX 77029
** c/o InterSystems, Inc., 13330 "I" Street, Omaha, NE 68137
(1) Except as otherwise indicated, each named holder has, to the best of the
Company's knowledge, sole voting and investment power with respect to the
shares indicated. Also includes shares that may be acquired within 60 days by
any of the named persons upon exercise of any right.
(2) Mr. Mathers is Chief Accounting Officer of the Company. His holdings
include 16,000 shares sold to Mr. Mathers in a private placement which are
offered hereby, and shares issuable upon exercise of 1,500 Warrants.
(3) Mr. Moser is Executive Vice President of InterSystems-Nebraska. His
holdings include 4,000 shares sold to him in a private placement which are
offered hereby.
<PAGE> 11
PLAN OF DISTRIBUTION
This Prospectus relates to the offer and sale of 275,000 shares
of Common Stock by the Company upon the exercise of the Warrants (hereinafter
in the aggregate the "Warrant Securities"), and the offer and sale of 145,000
shares of Common Stock by three Selling Stockholders. From time to time, the
Company may amend this Prospectus by Prospectus Supplements or post-effective
amendments to the Registration Statement of which this Prospectus is a part, to
offer shares of Common Stock obtained upon exercise of the Warrant Securities
by certain persons who may, by virtue of their relationship to the Company, be
deemed to be underwriters within the meaning of the Act.
The shares of Common Stock issuable upon exercise of the Warrant
Securities will be issued and distributed by the Company pursuant to the terms
and conditions of those securities. Such Common Stock is being registered
pursuant to the Act pursuant to the Company's contractual obligation to the
holders of the Warrants and offered by the Company hereby to permit the
issuance by the Company of registered stock upon the exercise of the Warrant
Securities in accordance with their terms. Additional shares of Common Stock
may be issuable pursuant to the anti-dilution provisions of the Warrant
Securities which shares are being registered hereby pursuant to Rule 416
promulgated under the Act. If all of the Warrant Securities are exercised, the
Company will receive aggregate cash proceeds estimated to be approximately
$412,500. See "Use of Proceeds."
All remaining securities covered by this Prospectus are being
offered for the accounts of the respective holders listed thereof under the
caption "Selling Stockholders." Consequently, the Company will not receive any
of the proceeds from the sale of the Securities offered hereby.
The Securities may be sold form time to time by the Selling
Stockholders, or by their pledgees, transferees or other successors in
interest, on the American Stock Exchange (or such other exchange on which the
Securities are listed at the time of sale), in the over-the-counter market or
otherwise, at prices and at terms then prevailing or at prices related to the
then current market price, or in privately negotiated transactions. The
Securities may be sold by various methods, including, but not limited to one or
more of the following: (a) directly in a privately negotiated transaction, (b)
a block trade in which the broker or dealer so engaged will attempt to sell
Securities as agent but may position and resell a portion of the block as
principal to facilitate the transaction, (c) purchases by a broker or dealer as
principal and resale by the broker or dealer for its own account pursuant to
this Prospectus, (d) a transaction on the American Stock Exchange in accordance
with the rules of such exchange, (e) and ordinary brokers transactions and
transactions in which the broker solicits the purchasers. In effecting sales,
brokers or dealers engaged by the Selling Stockholders may arrange for other
brokers or dealers to participate. Alternatively, the Selling Stockholder may
from time to time offer the Securities through underwriters, dealers or agents
who may Nothing to report. receive compensation in the form of underwriting
discounts, concessions, or commissions from the Selling Stockholders and/or
purchasers of Securities for whom they act as agents. In addition any of the
Securities which
<PAGE> 12
qualify for sale pursuant to Rule 144 under the Securities Act of 1933, as
amended (the "Act"), or otherwise pursuant to an applicable exemption under the
Act, may be sold other that pursuant to this Prospectus.
The Selling Stockholders and any such underwriters, dealers or
agents that participate in the distribution of Securities may be deemed to be
underwriters, and any profit on the sale of the Securities by them and any
discounts, commissions or concessions received by them may be deemed to be
underwriting discounts and commissions under the Act. The Company will not
receive any of the proceeds of the offering of the Securities hereunder for the
account of the Selling Stockholders. See "Use of Proceeds."
If required by law, at the time a particular offer of Securities
is made, a supplement to this Prospectus will be distributed which will
identify and set forth the aggregate amount of Securities being offered and the
terms of the offering, including the name or names of any underwriters, dealers
or agents, the purchase price paid by any underwriter for Securities purchased
from the Selling Stockholder, any discounts, commissions and other items
constituting compensation from the Selling Stockholder and/or the Company and
any discounts, commissions or concessions allowed or reallowed or paid to
dealers, including the proposed selling price to the public. Such supplement
to this Prospectus and, if necessary, a post-effective amendment to the
Registration Statement of which this Prospectus is a part, will be filed with
the Commission to reflect the disclosure of additional information with respect
to the distribution of the Securities.
The Selling Stockholders have entered into indemnification
agreements with the Company pursuant to which the Company will be indemnified
against failure by the Selling Stockholders to deliver a Prospectus if
required, as well as against certain civil liabilities, including liabilities
under the Act or the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), incurred in connection with any untrue (or alleged untrue) statement of
a material fact or ommission of a material fact in this Registration Statement
to the extent such liability relates to information supplied by the Selling
Stockholder for inclusion in the Registration Statement or Prospectus.
Under applicable rules and regulations under the Exchange Act,
any person engaged in a distribution of the Securities may not simultaneously
engage in market making activities with respect to the Securities for a period
of nine business days prior to the commencement of such distribution. In
addition and without limiting the foregoing, certain of the Selling
Stockholders and any person participating in the distribution of the Securities
will be subject to applicable provisions of the Exchange Act and the rules and
regulations thereunder, including without limitation Rules 10b-6 and 10b-7,
which provisions may limit the timing of purchases and sales of the Securities
by the Selling Stockholders. All of the foregoing may affect the marketability
of the Securities.
In order to comply with certain states' securities laws, if
applicable, the Securities will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In certain states the Securities
may not be sold unless the Securities have been registered or
<PAGE> 13
qualify for sale in such state, or unless an exemption from registration or
qualification is available and complied with.
The Company will pay all of the expenses incident to the
registration and certain other expenses related to this offering of the
Securities, other than underwriting commissions and discounts, normal
commission expenses and brokerage fees, applicable transfer taxes and
attorneys' fees of Selling Stockholders' counsel, which will be borne by the
Selling Stockholders.
LEGAL MATTERS
Certain legal matters relating to the validity of the Common
Stock being registered hereby have been passed upon for the Company by
Robinson, St. John & Wayne, Two Penn Plaza, Newark, New Jersey 07105.
EXPERTS
The consolidated financial statements of the Company incorporated
by reference in this Prospectus have been audited by BDO Seidman, LLP,
independent certified public accountants, to the extent and for the periods set
forth in their report incorporated herein by reference, and is incorporated
herein in reliance upon such report given upon the authority of said firm as
experts in auditing and accounting.
<PAGE> 14
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. Other Expenses of Issuance and Distribution.
The following table sets forth the estimated expenses of InterSystems,
Inc. in connection with the distribution of the securities being registered
pursuant to this Registration Statement.
<TABLE>
<S> <C>
Registration Fee.............................$ 307.76
Legal Fees and Expenses...................... 3,000.00
Blue Sky Fees and Expenses................... 1,000.00
Accounting Fees and Expenses................. 1,500.00
Transfer Agent's Fees and Expenses........... -
Printing and Engraving Expenses.............. -
Miscellaneous Expenses....................... 500
---------
TOTAL........................................$6,307.76
</TABLE>
Item 15. Indemnification of Directors and Officers.
Section 145(a) of the General Corporation Law of the State of Delaware
(the "General Corporation Law") provides, in general, that a corporation shall
have power to indemnify any person who was or is a party 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 he is or was a director or officer of the corporation. Such indemnity may
be against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred in connection with such
action, suit or proceeding, if the indemnitee acted in good faith and in a
manner reasonably believed to be in or not opposed to the best interests of the
corporation and with respect to any criminal action or proceeding, the
indemnitee must not have had reasonable cause to believe his conduct was
unlawful.
Section 145(b) of the General Corporation Law provides, in general,
that a corporation shall have power to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgement in its favor by reason of the fact that he is or was a director or
officer of the corporation (including attorney's fees) acutally and reasonably
incurred by him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interest of the corporation.
Section 145(g) of the General Corporation Law provides in general that
a corporation shall have power to purchase and maintain insurance on behalf of
any person who is or was a director or officer of the corporation against any
liability asserted against him or incurred by him in any capacity, or arising
out of his status as such, whether or not the corporation would have the power
to indemnify him against such liability under the provisions of the law.
<PAGE> 15
Article Eighth of the Registrant's Certificate of Incorporation and
Section Six of the Registrants's By-Laws give a director or officer the right
to be indemnified by the Registrant to the fullest extent permitted under
Delaware law.
Item 16: Exhibits
4.1 Form of Common Stock Purchase Warrants due June 30, 2000 *
5.1 Opinion of Robinson, St. John & Wayne, legal counsel to the Company *
13.1 The Company's Annual Report on Form 10-KSB for the year ended December 31,
1994 (1)
13.2 The Company's Quarterly Report on Form 10-QSB for the quarter ended
March 31, 1995 (1)
13.3 The Company's Quarterly Report on Form 10-QSB for the quarter ended
June 30, 1995 (1)
13.4 The Company's Quarterly Report on Form 10-QSB for the quarter ended
September 30, 1995 (1)
13.5 The Company's Current Report on Form 8-K dated December 11, 1995 (1)
23.1 Consent of BDO Seidman, LLP. *
23.2 Consent of Robinson, St. John & Wayne (included in Exhibit 5.1) *
24.1 Power of Attorney (included on Signature Page) *
- --------------------
* filed herewith
(1) Incorporated by reference to such document as filed with the Commission.
Item 17. Undertakings
The 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) [Not applicable];
(ii) [Not applicable];
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.
<PAGE> 16
(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 a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
(4) That for the 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 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.
(5) The registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is sent or
given, the registrant's latest annual report to security holders that is
incorporated by reference in the prospectus and furnished pursuant to and
meeting the requirements of Rule 14a-3 or 14c-3 under the Securiites Exchange
Act of 1934, and where interim financial informationrequired to be presented by
Article 3 of Regulation S-X is not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report on Form 10-Q, that is specifically incorporated by
reference in the prospectus to provide such interim financial information.
Insofar as indemnification of 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 said
Act and is therefore unenforceable. In the event that an agreement for an
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 a successful defense of any action, suit or
proceeding), is asserted by a 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 said Act
and will be governed by the final adjudication of such issue.
<PAGE> 17
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Houston,
State of Texas on this 26th day of December, 1995.
INTERSYSTEMS, INC.
By:/s/ Fred S. Zeidman
----------------------
Fred S. Zeidman, President,
Chief Executive Officer
and Director
(principal executive officer)
By:/s/ Daniel T. Murphy
------------------------
Daniel T. Murphy
Vice President
(principal financial officer)
By:/s/ W. Chris Mathers
------------------------
W. Chris Mathers
Controller
(principal accounting officer)
Each person whose signature appears below constitutes and appoints
Fred Z. Zeidman, Daniel T. Murphy and W. Chris Mathers true and lawful
attorneys-in-fact and agents, each acting alone, with full powers of
substitution and resubstitution, for him and in his name, place an stead, in
any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and to file the
same, with all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-
in-fact and agents, each acting alone, full powers 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, hereby ratifying and confirming all that said attorney-in-fact
and agents, each acting alone, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
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 December 26, 1995.
Signature Title
- --------- -----
/s/ Herbert M. Pearlman Chairman of the Board of
- ----------------------- Directors
Herbert M. Pearlman
<PAGE> 18
/s/ Fred S. Zeidman President, Chief Executive
- ----------------------- Officer and Director
Fred S. Zeidman
/s/ Daniel T. Murphy Executive Vice President and
- ----------------------- Chief Financial Officer and
Daniel T. Murphy Director
/s/ David S. Lawi Director
- -----------------------
David S. Lawi
/s/ Walter M. Craig, Jr Director
- -----------------------
Walter M. Craig, Jr.
/s/ John E. Stieglitz Director
- -----------------------
John E. Stieglitz
Director
- -----------------------
William Lurie
Director
- -----------------------
Leonard Friedman
<PAGE> 19
EXHIBIT INDEX
4.1 Form of Common Stock Purchase Warrants due June 30, 2000 *
5.1 Opinion of Robinson, St. John & Wayne, legal counsel to the Company *
13.1 The Company's Annual Report on Form 10-KSB for the year ended December 31,
1994 (1)
13.2 The Company's Quarterly Report on Form 10-QSB for the quarter ended
March 31, 1995 (1)
13.3 The Company's Quarterly Report on Form 10-QSB for the quarter ended
June 30, 1995 (1)
13.4 The Company's Quarterly Report on Form 10-QSB for the quarter ended
September 30, 1995 (1)
13.5 The Company's Current Report on Form 8-K dated December 11, 1995 (1)
23.1 Consent of BDO Seidman, LLP. *
23.2 Consent of Robinson, St. John & Wayne (included in Exhibit 5.1) *
24.1 Power of Attorney (included on Signature Page) *
- --------------------
* filed herewith
(1) Incorporated by reference to such document as filed with the Commission.
<PAGE> 1
EXHIBIT 4.1
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF
(COLLECTIVELY THE "SECURITIES") HAVE BEEN ACQUIRED FOR INVESTMENT ONLY AND HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR
ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, PLEDGED, HYPOTHECATED, OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO INTERSYSTEMS,
INC. THAT AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
INTERSYSTEMS, INC.
COMMON STOCK PURCHASE WARRANT CERTIFICATE
TO PURCHASE 00,000
SHARES OF COMMON STOCK
CERT. NO. ISI-1
This Warrant Certificate certifies that , residing at
or his registered assigns is the registered Holder (the "Holder") of 00,000
Common Stock Purchase Warrants (the "Warrants") to purchase shares of the
common stock, $.01 Par value (the "Common Stock") of INTERSYSTEMS, INC., a
Delaware corporation (the "Company"). This Warrant is issued pursuant to an
exercise and exchange offer made by the Company on April 16, 1995 to the
holders of certain common stock purchase warrants purchased from Chemical Bank.
1. EXERCISE OF WARRANT; REDEMPTION OF WARRANT.
(A) Each Warrant enables the Holder, subject to the provisions
of this Warrant Certificate to purchase from the Company at any time and from
time to time commencing on the later of (i) January 15, 1996, or (ii) the date
that the shares of Common Stock underlying the Warrants are approved for listing
on the American Stock Exchange (the "Initial Exercise Date") one (1) fully paid
and non-assessable share of Common Stock ("Shares") upon due presentation and
surrender of this Warrant Certificate accompanied by payment of the purchase
price of $1.50 per Share (the "Exercise Price"). The Warrant shall expire on
June 30, 2000 (the "Expiration Date"). Payment shall be made in lawful money of
the United States of america by certified check payable to the Company at its
principal office at 8790 Wallisville Road, Houston, Texas 77029. As
hereinafter provided, the Exercise Price and number of Shares purchasable upon
the exercise of the Warrants may be subject to modification or adjustment upon
the happening of certain events.
(B) This Warrant Certificate is exercisable at any time on or
after the Initial Exercise Date in whole or in part by the Holder in person or
by attorney duly authorized in writing at the principal office of the Company.
(C) The Warrants shall be redeemable, at the option of the
Company, at a price of $.05 Per Warrant, upon not less than thirty (30) days'
written notice to the Holder at such time as (i) the closing sales price of
the Common Stock on the American Stock Exchange on each of 20 consecutive
trading days is at least 200% of the Exercise Price then in effect, and (ii)
the shares issuable upon exercise of the Warrants are
<PAGE> 2
registered pursuant to an effective registration statement under the Securities
Act of 1933, as amended (hereinafter the "Act").
2. EXCHANGE, FRACTIONAL SHARES, TRANSFER.
(A) Upon surrender to the Company, this Warrant Certificate may
be exchanged for another Warrant Certificate or Warrant Certificates evidencing
a like aggregate number of Warrants. If this Warrant Certificate shall be
exercised in part, the Holder shall be entitled to receive upon surrender hereof
another Warrant Certificate or Warrant Certificates evidencing the number of
Warrants not exercised;
(B) Anything herein to the contrary notwithstanding, in no event
shall the Company be obligated to issue Warrant Certificates evidencing other
than a whole number of Warrants or issue certificates evidencing other than a
whole number of Shares upon the exercise of this Warrant Certificate; provided,
however, that the Company shall pay with respect to any such fraction of a Share
an amount of cash based upon the current public market value for Shares
purchasable upon exercise hereof. Market price for the purpose of this Section 2
shall mean the last reported sale price on the American Stock Exchange or such
primary exchange on which the Common Stock is traded.
(C) The Company may deem and treat the person in whose name this
Warrant Certificate is registered as the absolute true and lawful owner hereof
for all purposes whatsoever; and
(D) This Warrant Certificate may not be transferred except in
compliance with the provisions of the Act or applicable state securities laws
and in accordance with the provisions of Paragraph 8 hereof.
3. RIGHTS OF A HOLDER. No Holder shall be deemed to be the Holder
of Common Stock or any other securities of the Company that may at any time be
issuable on the exercise hereof for any purpose, nor shall anything contained
herein be construed to confer upon the Holder any of the rights of a shareholder
of the Company or any right to vote for the election of directors or upon any
matter submitted to shareholders at any meeting thereof or to give or withhold
consent to any corporate action (whether upon any reorganization, issuance of
stock, reclassification or conversion of stock, change of par value,
consolidation, merger, conveyance, or otherwise) or to receive notice of
meetings or to receive dividends or subscription rights or otherwise until a
Warrant shall have been exercised and the Common Stock purchasable upon the
exercise thereof shall have become issuable.
4. REGISTRATION OF TRANSFER. The Company shall maintain books for
the transfer and registration of Warrants. Upon the transfer of any Warrants in
accordance with the provisions of Section 2(D) hereof, (a "Permitted Transfer"),
the Company shall issue and register the Warrants in the names of the new
Holders. The Warrants shall be signed manually by the Chairman, Chief Executive
Officer, President or any Vice President and the Secretary or Assistant
Secretary of the Company. The Company shall transfer, from time to time, any
outstanding Warrants upon the books to be maintained by the Company for such
purpose upon surrender thereof for transfer properly endorsed or accompanied by
appropriate instructions for transfer. Upon any Permitted Transfer, a new
Warrant
<PAGE> 3
Certificate shall be issued to the transferee and the surrendered Warrants
shall be cancelled by the Company. Warrants may be exchanged at the option of
the Holder, when surrendered at the office of the Company, for another Warrant,
or other Warrants of different denominations, of like tenor and representing in
the aggregate the right to purchase a like number of Shares. Subject to the
terms of this Warrant Certificate, upon such surrender and payment of the
purchase price at any time after the Initial Exercise Date, the Company shall
issue and deliver with all reasonable dispatch to or upon the written order of
the Holder of such Warrants and in such name or names as such Holder may
designate, a certificate or certificates for the number of full Shares so
purchased upon the exercise of such Warrants. Such certificate or certificates
shall be deemed to have been issued and any person so designated to be named
therein shall be deemed to have become the Holder of record of such Shares as
of the date of the surrender of such Warrants and payment of the purchase
price; provided, however, that if, at the date of surrender and payment, the
transfer books of the Shares shall be closed, the certificates for the Shares
shall be issuable as of the date on which such books shall be opened and until
such date the Company shall be under no duty to deliver any certificate for
such Shares; provided, further, however, that such transfer books, unless
otherwise required by law or by applicable rule of any national securities
exchange, shall not be closed at any one time for a period longer than 20 days.
The rights of purchase represented by the Warrants shall be exercisable, at the
election of the Holders, either as an entirety or from time to time for only
part of the Shares at any time on or after the Initial Exercise Date.
5. STAMP TAX. The Company will pay any documentary stamp taxes
attributable to the initial issuance of the Shares issuable upon the exercise
of the Warrants; provided, however, that the Company shall not be required to
pay any tax or taxes which may be payable in respect of any transfer involved in
the issuance or delivery of any certificates for Shares in a name other than
that of the Holder in respect of which such Shares are issued, and in such case
the Company shall not be required to issue or deliver any certificate for Shares
or any Warrant until the person requesting the same has paid to the Company the
amount of such tax or has established to the Company's satisfaction that such
tax has been paid.
6. LOST, STOLEN OR MUTILATED CERTIFICATES. In case this Warrant
Certificate shall be mutilated, lost, stolen or destroyed, the Company may, in
its discretion, issue and deliver in exchange and substitution for and upon
cancellation of the mutilated Warrant Certificate, or in lieu of and
substitution for the lost, stolen or destroyed Warrant Certificate, a new
Warrant Certificate of like tenor representing an equivalent right or interest,
but only upon receipt of evidence satisfactory to the Company of such loss,
theft or destruction and an indemnity, if requested, also satisfactory to it.
7. RESERVED SHARES. The Company warrants that there have been
reserved, and covenants that at all times in the future it shall keep reserved,
out of the authorized and unissued Common Stock, a number of Shares sufficient
to provide for the exercise of the rights of purchase represented by this
Warrant Certificate. The Company agrees that all Shares issuable upon exercise
of the Warrants shall be, at the time of delivery of the certificates for such
Shares, validly issued and
<PAGE> 4
outstanding, fully paid and non-assessable and that the issuance of such Shares
will not give rise to preemptive rights in favor of existing stockholders.
8. TRANSFER TO COMPLY WITH THE SECURITIES ACT OF l933.
(A) The Holder of this Warrant Certificate, each transferee hereof and
any Holder and transferee of any Shares, by his acceptance thereof, agrees that
(a) the Warrants and any Shares have not been registered under the Act or
applicable state securities laws (the "State Acts"), and therefore cannot be
transferred or sold unless subsequently registered under the Act and applicable
State Acts, or an exemption from registration is available, (b) no public
distribution of Warrants or Shares will be made in violation of the Act, and (c)
during such period as the delivery of a prospectus with respect to Warrants or
Shares may be required by the Act, no public distribution of Warrants or Shares
will be made in a manner or on terms different from those set forth in, or
without delivery of, a prospectus then meeting the requirements of Section l0 of
the Act and in compliance with applicable state securities laws. The Holder of
this Warrant Certificate and each transferee hereof further agrees that if any
distribution of any of the Warrants or Shares is proposed to be made by them
otherwise than by delivery of a prospectus meeting the requirements of Section
l0 of the Act, such action shall be taken only after submission to the Company
of an opinion of counsel, reasonably satisfactory in form and substance to the
Company's counsel, to the effect that the proposed distribution will not be in
violation of the Act or of applicable state law. Furthermore, it shall be a
condition to the transfer of the Warrants that any transferee thereof deliver to
the Company his written agreement to accept and be bound by all of the terms and
conditions contained in this Warrant Certificate.
(B) This Warrant or the Shares or any other security issued or
issuable upon exercise of this Warrant may not be sold or otherwise disposed
of except as follows:
(1) To a person who, in the opinion of counsel for the Holder
reasonably acceptable to the Company, is a person to whom this Warrant or Shares
may legally be transferred without registration and without the delivery of a
current prospectus under the Act with respect thereto and then only against
receipt of an agreement of such person to comply with the provisions of this
Section (1) with respect to any resale or other disposition of such securities
which agreement shall be satisfactory in form and substance to the Company and
its counsel; provided that the foregoing shall not apply to any such Warrant,
Shares or other security as to which such Holder shall have received an opinion
letter from counsel to the Company as to the exemption thereof from the
registration under the Act pursuant to Rule 144(k) under the Act; or
(2) To any person upon delivery of a prospectus then meeting the
requirements of the Act relating to such securities and the offering thereof
for such sale or disposition.
<PAGE> 5
(C) Each certificate for Shares issued
upon exercise of this Warrant shall bear a legend relating to the
non-registered status of such Shares under the Act, unless at the time of
exercise of this Warrant such Shares are subject to a currently effective
registration statement under the Act.
9. ANTI-DILUTION PROVISIONS.
(A) Dividends; Reclassifications, etc.
(i) In the event that the Company shall, at any time prior to the
exercise of this Warrant declare or pay to the holders of the Common Stock a
dividend payable in Common Stock or Convertible Securities (as hereinafter
defined) of the Company, then the Exercise Price shall be subject to adjustment
pursuant to subparagraph (C) of this Section 9.
(ii) If, at any time after the date of issuance hereof, the Company
shall subdivide its outstanding shares of Common Stock, combine the outstanding
shares of Common Stock into a smaller number of shares, or issue by
reclassification of its shares of Common Stock (including any reclassification
in connection with a consolidation or merger in which the Company is the
continuing corporation) any shares, the Exercise Price in effect at the time of
the effective date of such subdivision, combination or reclassification shall
be proportionately adjusted so that the Holder of this Warrant exercising it
after such time shall be entitled to receive the total number and kind of
shares which bear the same proportion to the total immediately after such time
as the proportion he would have owned and have been entitled to receive
immediately prior to such time bore to the total immediately prior to such
time.
(iii) In the event that the Company shall, at any time prior to the
exercise of this Warrant, (a) declare or pay to holders of Common Stock a
dividend payable in any security of the Company other than Common Stock or
Convertible Securities; (b) transfer its property as an entirety or
substantially as an entirety to any other company; (c) make any distribution of
its assets to holders of its Common Stock as a liquidation or partial
liquidation dividend or by way of return of capital; or (d) undergo a merger or
consolidation in which the Company is not the continuing corporation; then,
upon the subsequent exercise of this Warrant, the Holder shall receive, in
addition to or in substitution for the shares of Common Stock to which it would
otherwise be entitled upon such exercise, such additional securities of the
Company, or such shares of the securities or property of the Company resulting
from such transfer, or such assets of the Company, or such shares of the
securities or property of the continuing corporation in the event of such
merger or consolidation, which it would have been entitled to receive had it
exercised this Warrant prior to the happening of any of the foregoing events.
(B) Notice. If, at any time while this Warrant is outstanding,
the Company shall pay any dividend payable in cash or in Common Stock, shall
offer to the holders of its Common Stock for subscription or purchase by them
any shares of stock of any class or any other rights, or shall enter into an
agreement to merge or consolidate with another corporation, the Company shall
cause notice thereof to be mailed to the
<PAGE> 6
registered Holder of this Warrant at its address appearing on the registration
books of the Company, at least l0 days prior to the record date as of which
holders of Common Stock shall participate in such dividend, distribution or
subscription or other rights or at least l0 days prior to the effective date of
the merger or consolidation. Failure to give notice as required by this
Section, or any defect therein, shall not affect the legality or validity of
any dividend, distribution or subscription or other right.
(C) Adjustments to Exercise Price. If at any time after the
date of issuance hereof the Company shall grant or issue any shares of Common
Stock, or grant or issue any rights or options for the purchase of, or stock or
other Securities convertible into, Common Stock (such convertible stock or
securities being herein collectively referred to as "Convertible Securities")
other than:
(i) shares issued in a transaction described in subparagraph (D) of
this Section 9; or
(ii) shares issued, subdivided or combined in transactions described
in subsections (A)(ii) or (iii) of this Section 9;
for a consideration per share which is less than the Exercise Price, then the
Exercise Price in effect immediately prior to such issuance or sale (the
"Applicable Exercise Price") shall, and thereafter upon each issuance or sale,
the Applicable Exercise Price shall, simultaneously with such issuance or sale,
be adjusted, so that such Applicable Exercise Price shall equal a price
determined by multiplying the Applicable Exercise Price by a fraction, the
numerator of which shall be:
(A) the sum of (x) the total number of shares of Common Stock
outstanding immediately prior to such issuance plus (y) the number of
shares of Common Stock which the aggregate consideration received, as
determined in accordance with subparagraph (E) below for the issuance
or sale of such additional Common Stock or Convertible Securities
deemed to be an issuance of Common Stock as provided in subsection (F)
below, would purchase (including any consideration received by the
Company upon the issuance of any shares of Common Stock or Convertible
Securities since the date the Applicable Exercise Price became
effective not previously included in any computation resulting in an
adjustment pursuant to this subsection (C)) at the Applicable Exercise
Price; and the denominator of which shall be
(B) the total number of shares of Common Stock outstanding (or
deemed to be outstanding as provided in subsection (E)) immediately
after the issuance or sale of such additional shares.
If, however, the Applicable Exercise Price thus obtained would result in the
issuance of a lesser number of shares upon conversion than would be issued at
the initial Exercise Price specified in Section 1, the Applicable Price shall
be such initial Exercise Price.
Upon each adjustment of the Exercise Price pursuant to this subsection
(C) the total number of shares of Common Stock purchasable upon the exercise of
each Warrant shall be such number of shares (calculated to the nearest tenth)
purchasable at the Applicable Exercise
<PAGE> 7
Price multiplied by a fraction, the numerator of which shall be the Exercise
Price in effect immediately prior to such adjustment and the denominator of
which shall be the Exercise Price in effect immediately after such adjustment.
(D) Anything in this Section 9 to contrary notwithstanding, no
adjustment in the Exercise Price shall be made in connection with:
(i) the grant, issuance or exercise or any Convertible Securities
pursuant to the Company's qualified or non-qualified Employee Stock
Option Plans or any other bona fide employee benefit plan or incentive
arrangement, adopted by the Company's Board of Directors, as may be
amended from time to time, or under any other bona fide employee benefit
plan hereafter or incentive arrangement adopted by the Company's Board of
Directors; or
(ii) the issuance of any shares of Common Stock pursuant to the
grant or exercise of Convertible Securities outstanding as of the date
hereof including, without limitation, the exercise of any Warrant or
conversion of any Preferred Stock issued in the same placement of
securities to which this Warrant was issued by the Company, whether or
not outstanding on the issuance date hereof.
(E) For the purpose of subsection (C) above, the following
provisions shall also be applied:
(i) In case of the issuance or sale of additional shares of Common
Stock for cash, the consideration received by the Company therefor shall
be deemed to be the amount of cash received by the Company for such
shares, before deducting therefrom any commissions, compensations or
other expenses paid or incurred by the Company for any underwriting of,
or otherwise in connection with, the issuance or sale of such shares.
(ii) In case of the issuance of Convertible Securities, the
consideration received by the Company therefore shall be deemed to be
the amount of cash, if any, received by the Company for the issuance of
such rights or Convertible Securities, plus the minimum amounts of cash
and fair value of other consideration, if any, payable to the Company
upon the exercise of such rights or options or payable to the Company on
conversion of such Convertible Securities.
(iii) In the case of the issuance of shares of Common Stock or
Convertible Securities for a consideration in whole or in part, other
than cash, the consideration other than cash shall be deemed to be the
fair market value thereof as reasonably determined in good faith by the
Board of Directors of the Company (irrespective of accounting treatment
thereof); provided, however, that if such consideration consists of the
cancellation of debt issued by the Company, the consideration shall be
deemed to be the amount the Company received upon issuance of such debt
(gross proceeds) plus accrued interest and, in the case of original
issue discount or zero coupon indebtedness, accreted value to the date
of such cancellation, but not including any premium or discount at which
the debt may then be trading or which might otherwise be appropriate for
such class of debt.
<PAGE> 8
(iv) In case of the issuance of additional shares of Common Stock
upon the conversion or exchange of any obligations (other than
Convertible Securities), the amount of the consideration received by
the Company for such Common Stock shall be deemed to be the
consideration received by the Company for such obligations or shares so
converted or exchanged, before deducting from such consideration so
received by the Company any expenses or commissions or compensations
incurred or paid by the Company for any underwriting of, or otherwise
in connection with, the issuance or sale of such obligations or shares,
plus any consideration received by the Company in connection with such
conversion or exchange other than a payment in adjustment of interest
and dividends. If obligations or shares of the same class or series of
a class as the obligations or shares so converted or exchanged have
been originally issued for different amounts of consideration, then the
amount of consideration received by the Company upon the original
issuance of each of the obligations or shares so converted or exchanged
shall be deemed to be the average amount of the consideration received
by the Company upon the original issuance of all such obligations or
shares. The amount of consideration received by the Company upon the
original issuance of the obligations or shares so converted or
exchanged and the amount of the consideration, if any, other than such
obligations or shares, received by the Company upon such conversion or
exchange shall be determined in the same manner as provided in Sections
(1) and (3) above with respect to the consideration received by the
Company in case of the issuance of additional shares of Common Stock or
Convertible Securities.
(v) In the case of the issuance of additional shares of Common
Stock or Convertible Securities as a dividend, the aggregate number of
shares of Common Stock or Convertible Securities issued in payment of
such dividend shall be deemed to have been issued at the close of
business on the record date fixed for the determination of stockholders
entitled to such dividend and shall be deemed to have been issued
without consideration; provided, however, that if the Company, after
fixing such record date, shall legally abandon its plan to so issue
Common Stock or said Convertible Securities as a dividend, no
adjustment of the Applicable Exercise Price shall be required by reason
of the fixing of such record date.
(F) For purposes of the adjustments provided for in subsection
(C) above, if at any time, the Company shall issue any Convertible Securities,
the Company shall be deemed to have issued at the time of the issuance of such
Convertible Securities the maximum number of shares of Common Stock issuable
upon conversion of the total amount of such Convertible Securities.
(G) On the expiration, cancellation or redemption of any
Convertible Securities, the Exercise Price then in effect hereunder shall
forthwith be readjusted to such Exercise Price as would have been obtained (a)
had the adjustments made upon the issuance or sale of such expired, cancelled or
redeemed Convertible Securities been made upon the basis of the issuance of only
the number of shares of Common Stock theretofore actually delivered upon the
exercise or conversion of such Convertible Securities (and the total
consideration received therefor) and (b) had all subsequent adjustments been
made only on the basis of the
<PAGE> 9
Exercise Price as readjusted under this subsection (G) for all transactions
(which would have affected such adjusted Exercise Price) made after the
issuance or sale of such Convertible Securities.
(H) Anything in this Section 9 to the contrary notwithstanding, no
adjustment in the Exercise Price shall be required unless such adjustment would
require an increase or decrease of at least 1% in such Exercise Price; provided,
however, that any adjustments which by reason of this subsection (H) are not
required to be made shall be carried forward and taken into account in making
subsequent adjustments. All calculations under this Section 9 shall be made to
the nearest cent or to the nearest tenth of a share, as the case may be.
(I) Upon any adjustment of any Exercise Price, then and in each such
case the Company shall promptly deliver a notice to the registered Holder of
this Warrant, which notice shall state the Exercise Price resulting from such
adjustment and the increase or decrease, if any, in the number of shares
purchasable at such price upon the exercise hereof, setting forth in reasonable
detail the method of calculation and the facts upon which such calculation is
based.
10. CONSOLIDATION OR MERGER. The Company covenants and agrees that
it will not merge or consolidate with or into or sell or otherwise transfer all
or substantially all of its assets to any other corporation or entity unless at
the time of or prior to such transaction such other corporation or other entity
shall expressly assume all of the liabilities and obligations of the Company
under this Warrant and (without limiting the generality of the foregoing) shall
expressly agree that the Holder of this Warrant shall thereafter have the right
(subject to subsequent adjustment as nearly equivalent as practicable to the
adjustments provided for in Section 9 of this Warrant) to receive upon the
exercise of this Warrant the number and kind of shares of stock and other
securities and property receivable upon such transaction by a Holder of the
number and kind of shares which would have been receivable upon the exercise of
this Warrant immediately prior to such transaction.
11. MISCELLANEOUS.
(A) LAW TO GOVERN. This Warrant shall be governed by and construed
in accordance with the substantive laws of the State of Texas, without giving
effect to conflict of laws principles.
(B) ENTIRE AGREEMENT. This Warrant Certificate constitutes and
expresses the entire understanding between the parties hereto with respect to
the subject matter hereof, and supersedes all prior and contemporaneous
agreements and understandings, inducements or conditions whether express or
implied, oral or written. Neither this Warrant Certificate nor any portion or
provision hereof may be changed, waived or amended orally or in any manner other
than by an agreement in writing signed by the Holder and the Company.
<PAGE> 10
(C) NOTICES. Except as otherwise provided in this Warrant
Certificate, all notices, requests, demands and other communications required or
permitted under this Warrant Certificate or by law shall be in writing and shall
be deemed to have been duly given, made and received only when delivered against
receipt or when deposited in the United States mails, certified or registered
mail, return receipt requested, postage prepaid, addressed as follows:
Company: InterSystems, Inc.
8790 Wallisville Road
Houston, Texas 77029
Attn: President
Holder: At the address shown for the Holder in the
registration book maintained by the Company.
(D) SEVERABILITY. If any provision of this Warrant Certificate is
prohibited by or is unlawful or unenforceable under any applicable law of any
jurisdiction, such provision shall, as to such jurisdiction be in effect to the
extent of such prohibition without invalidating the remaining provisions hereof;
provided, however, that any such prohibition in any jurisdiction shall not
invalidate such provision in any other jurisdiction; and provided, further that
where the provisions of any such applicable law may be waived, that they hereby
are waived by the Company and the Holder to the full extent permitted by law and
to the end that this Warrant instrument shall be deemed to be a valid and
binding agreement in accordance with its terms.
IN WITNESS WHEREOF, InterSystems, Inc. has caused this Warrant
Certificate to be signed by its duly authorized officers as of the 15th day of
July, 1995.
INTERSYSTEMS, INC.
By:
-------------------------------
Name: Herbert M. Pearlman
Title: Chairman of the Board of
Directors
Attest:
- -------------------------
David S. Lawi
Secretary
<PAGE> 11
PURCHASE FORM
To: InterSystems, Inc.
, l99___
The undersigned hereby irrevocably elects to exercise the attached Warrant
Certificate, Certificate No. ISI-_______, to the extent of _________ Shares of
Common Stock, $.0l par value per share of INTERSYSTEMS, INC., and hereby makes
payment of $________ in payment of the aggregate exercise price thereof.
INSTRUCTIONS FOR REGISTRATION OF SECURITIES
Name:
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(Please typewrite or print in block letters)
Address:
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--------------------------
By:
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<PAGE> 1
EXHIBIT 5.1
Robinson, St. John & Wayne
Attorneys At Law
Two Penn Plaza East
Newark, New Jersey 07105-2249
(201) 491-3300
January 2, 1996
InterSystems, Inc.
8790 Wallisville Road
Houston, Texas 77029
RE: InterSystems, Inc.
Form S-3 Registration Statement Covering 420,000 Shares of
Common Stock
Gentlemen:
We have acted as counsel for InterSystems, Inc., a Delaware
corporation (the "Company"), in connection with the preparation and filing by
the Company of the captioned Registration Statement on Form S-3 filed under the
Securities Act of 1933, as amended (the "Act")(the "Registration Statement").
Terms used herein and not otherwise defined shall have the meaning ascribed
thereto in the Registration Statement.
In that connection, we have examined the Certificate of Incorporation
and the By-Laws of the Company, the minutes of the various meetings and
consents of the Board of Directors of the Company, and such other documents,
certificates, records, authorizations, proceedings, statutes and judicial
decisions as we have deemed necessary to form the basis of the opinion
expressed below. In such examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals and
the conformity to originals of all documents submitted to us as copies thereof.
As to various questions of fact material to such opinion, we have relied upon
statements and certificates of officers and representatives of the Company and
others.
Based upon the foregoing, we are of the opinion that:
1. The Company has been duly organized and is validly existing as a
corporation under the laws of the State of Delaware.
2. The outstanding Securities have been duly authorized and are validly
issued, fully paid and non-assessable.
3. The Securities which are not outstanding, when exercised in accordance
with the terms of the Warrants and upon the Company's
<PAGE> 2
InterSystems, Inc.
January 2, 1996
Page 2
receipt of the exercise price or other consideration therefor stated in such
Warrants, will be validly issued, fully paid and non-assessable.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement, and to the reference to our firm under the caption
"Legal Matters" in the Prospectus comprising a part of the Registration
Statement.
By giving the foregoing consent, we do not come within the category of
persons whose consent is required under Section 7 of the Act or are otherwise
within the category of persons described in Section 11(a)(4) of the Act.
Very truly yours,
ROBINSON, ST. JOHN & WAYNE
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
InterSystems, Inc.
Houston, Texas
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of our report dated March 3,
1995, relating to the consolidated financial statements of InterSystems, Inc.
appearing in the Company's Annual Report on Form 10-KSB for the year ended
December 31, 1994.
We also consent to the reference to us under the caption "Expert" in the
Prospectus.
BDO Seidman, LLP
Houston, Texas
January 2, 1996
