<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 10, 2000
REGISTRATION NO. 333-34866
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------
Amendment No. 2
FORM S-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------------
SOFTLOCK.COM, INC.
(Exact name of registrant as specified in its charter)
7372
(Primary Standard Industrial Classification Code Number)
<TABLE>
<S> <C>
DELAWARE 84-1130229
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number)
</TABLE>
Five Clock Tower Place, Suite 440, Maynard, Massachusetts 01754
(978) 461-5940
(Address, including zip code, and telephone number, including area code,
of Registrant's principal executive offices)
----------------------------
SCOTT W. GRIFFITH, PRESIDENT AND CHIEF EXECUTIVE OFFICER
SOFTLOCK.COM, INC.
FIVE CLOCK TOWER PLACE, SUITE 440
MAYNARD, MASSACHUSETTS 01754
(978) 461-5940
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
-----------------------
Copies to:
CLIVE R.G. O'GRADY, ESQ.
MCGUIREWOODS LLP
1750 TYSONS BLVD., SUITE 1800
TYSONS CORNER
MCLEAN, VIRGINIA 22102-3915
Approximate date of commencement of proposed sale to the public: The earlier of
(i) four months after this Registration Statement becomes effective or (ii)
November 1, 2000.
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, check the following box: /X/
If the registrant elects to deliver its latest annual report to security
holders, or a complete and legible facsimile thereof, pursuant to Item 11(a)(1)
of this Form, check the following box: /X/
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the
<PAGE>
Securities Act of 1933, please check the following box and list the Securities
Act of 1933 registration statement number of the earlier effective registration
statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act of 1933, check the following box and list the Securities Act
of 1933 registration statement number of the earlier effective registration
statement for the same offering. / /
If this form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act of 1933, check the following box and list the Securities Act
of 1933 registration statement number of the earliest 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. / /
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
Title of Each Class of Amount to Be Proposed Maximum Proposed Maximum Amount of
Securities To Be Registered Registered Aggregate Aggregate Offering Registration Fee(2)
Offering Price Per Unit(1) Price(1)
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock par value $.01 5,312,600 $8.99 $47,760,274 $12,610
per share
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of determining the registration fee.
In accordance with Rule 457(c), the price shown is based on the average
of the high and low price of our common stock on April 13, 2000 as
reported on the OTC Bulletin Board.
(2) Previously paid.
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 COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
<PAGE>
SUBJECT TO COMPLETION, DATED AUGUST 10, 2000
SOFTLOCK.COM, INC. LOGO
5,312,600 SHARES
COMMON STOCK
---------------------------------------------------
<TABLE>
<CAPTION>
The Offering: The Selling Shareholders:
<S> <C>
- The selling shareholders will pay all of their
- This is an offering by the selling shareholders to commissions, brokerage fees and related expenses. We
sell 5,312,600 shares of our common stock. will pay all of the expenses of this offering,
estimated to be approximately $94,610, including up to
- We will not receive any proceeds from the sale $20,000 in legal fees for the selling shareholders.
of our common stock by the selling shareholders.
Trading Symbol: - The selling shareholders will not sell any of the
shares until the earlier of (i) four months after the
Our common stock is listed on the over-the- registration statement of which this prospectus is a
counter bulletin board under the symbol part is declared effective or (ii) November 1, 2000.
"SLCK."
</TABLE>
BEFORE MAKING ANY INVESTMENT IN OUR SECURITIES, YOU SHOULD READ AND CAREFULLY
CONSIDER THE RISKS DESCRIBED IN THE RISK FACTORS BEGINNING ON PAGE 1.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is accurate or complete. Any representation to the contrary is a
criminal offense.
The information in this prospectus is not complete and may be changed. Selling
shareholders may not sell these securities until the registration statement
filed with the Securities and Exchange Commission is effective. This prospectus
is not an offer to sell these securities and it is not soliciting an offer to
buy these securities in any state where the offer or sale is not permitted.
<PAGE>
-------------------------------------------------------------------------------
SUMMARY
This is an offering by the selling shareholders to sell 5,312,600
shares of our common stock.
We will not receive any proceeds from the sale of our common
stock by the selling shareholders. The selling shareholders may not sell any
of the shares until the earlier of (i) four months after the registration
statement, of which this prospectus is a part, is declared effective or (ii)
November 1, 2000. After that time, the selling shareholders may sell their
shares from time to time in a variety of transactions at market prices
prevailing at the time of sale or at negotiated prices.
We provide integrated content management and context marketing to allow
commercial web sites to securely market and sell digital content. Publishers of
digital content, including research reports, newsletters and electronic books,
use our system to package and securely distribute their products while
protecting their intellectual property. We market digital content through
strategic relationships with many affiliates who offer the digital content on
their web sites. When a prospective consumer accesses the content, the consumer
can preview selected portions of the final product. The consumer can then
instantly purchase access to the complete product 24 hours a day, 7 days a week
via the World Wide Web. The consumer then has permanent access to the product
for the consumer's own use. Consumers are encouraged to pass along the digital
content they have purchased, but recipients can only preview the selected
portions of the final product chosen by the content provider until they go
through the purchase process themselves.
Through our product the content can be securely sampled, electronically
purchased and redistributed, and our patented technology is designed to keep
intellectual property secure while generating valuable marketing data and sales
revenue.
The mailing address of our principal executive offices is Five Clock
Tower Place, Suite 440, Maynard, Massachusetts 01754 and our telephone number is
(978) 461-5940.
-------------------------------------------------------------------------------
<PAGE>
RISK FACTORS
You should read this entire prospectus and the documents incorporated
by reference before investing in our common stock. The following factors may
adversely impact your investment in the common stock. There may be factors
that are not known or determined to be material at the present time.
WE HAVE A HISTORY OF LOSSES AND NEGATIVE CASH FLOW AND ANTICIPATE CONTINUED
LOSSES, AND THEREFORE, WE MAY NEVER ACHIEVE PROFITABILITY IN THE FUTURE OR
SUSTAIN PROFITABILITY.
We have incurred recurring operating losses and negative cash flow
since our inception and have recorded limited revenues to date. We expect to
continue incurring significant and increasing net operating losses in the
future as we continue to develop products and expand our marketing strategy.
For example, we incurred a net operating loss of $6,643,204 for the fiscal
year ended December 31, 1999 and $3,190,932 for the fiscal quarter ended
March 31, 2000, and our accumulated deficit is $11,813,787 through March 31,
2000. Our planned expenditures are expected to continue growing throughout
2000 as we increase research and development, sales and marketing and general
and administrative expenses. We cannot assure you that we will ever achieve
profitability in the future or sustain profitability, if achieved.
<PAGE>
<PAGE>
BECAUSE COMMERCIAL PUBLISHERS MAY HAVE CONCERNS ABOUT THE SECURITY OF THEIR
INTELLECTUAL RIGHTS AND CANNIBALIZATION OF THEIR PRINT SALES, WE MAY NOT BE
SUCCESSFUL IN ATTRACTING CONTENT PROVIDERS. THEREFORE OUR BUSINESS AND YOUR
STOCK VALUE MAY SUFFER.
Commercial publishers, a generic term for the owner of the
intellectual property, which includes traditional print publishers as well as
media and research organizations, have in the past, distributed their
products through traditional distribution channels for printed materials.
Such commercial publishers, while interested in using the internet as a new
incremental sale channel, have concerns about the protection of their
intellectual rights using a digital medium. They worry, among other things,
that their content may be posted for free on the internet. In addition,
commercial publishers are also resistant to digital distribution for fear
that it might cannibalize their print sales. Because we receive a transaction
fee every time a user purchases electronic content, in order to generate
sufficient transaction fees to support our business, we must convince content
providers of the merits of our system and adoption of the internet as a new
incremental sales channel. Our failure to do so would result in less content
being available for sale on our system which may adversely affect the value
of your interest in our company.
WE RELY ON OUR AFFILIATE NETWORK AS THE MAIN SOURCE OF TRAFFIC TO OUR
WEBSITE. THEREFORE, IF WE FAIL TO ATTRACT THE NUMBER OF AFFILIATES NEEDED, WE
MAY NOT GENERATE SUFFICIENT REVENUE TO SUPPORT FUTURE DEVELOPMENT EFFORTS OR
ONGOING BUSINESS OPERATIONS.
A key part of our strategy is to actively facilitate and create
demand for information products by developing an affiliate program with
websites whose visitors are likely to purchase content offered through our
system. Our affiliates will place a link on their website allowing a prospect
to easily and conveniently purchase a desired information product. When the
prospect clicks on the link, they are taken to our system but in many cases
our site looks like the affiliate's site or does not indicate that it is a
SoftLock site. We believe this private label approach makes our system more
attractive to affiliates. Other internet companies may use their affiliate
network to drive incremental traffic to their portal site whereas we use our
affiliate network as the primary source of traffic to our site. Not
specifically branding a SoftLock portal site makes our results more dependent
on our ability to attract affiliates that draw high traffic. There are a
variety of reasons that high traffic sites have been and may continue to be
resistant to becoming out affiliates. In some cases, high traffic sites have
preferred selling their website space to advertisers or others who pay an
upfront fee rather than providing to that space on a commission structure
whereby the affiliate only receives money upon the purchase of content. If we
do not attract a sufficient number of affiliates and our affiliates are not
successful in converting website visitors into content purchasers, we may not
generate revenues sufficient for continued business operation or growth and
the value of your stock may not appreciate or may decline.
SINCE WE HAVE NOT YET ACHIEVED PROFITABILITY AND WILL NEED TO RAISE
ADDITIONAL CAPITAL, THE VALUE OF YOUR STOCK HOLDINGS MAY BE ADVERSELY
AFFECTED BY OUR FAILURE TO RAISE ADEQUATE CAPITAL.
We anticipate that we will continue to incur operating losses,
negative cash flows from operations and capital expenditures through 2000 and
2001. Based upon our current operating plan, we anticipate that our currently
available funds will be sufficient to satisfy our anticipated needs for
working capital, capital expenditures and business expansion through 2000. As
such, we will need to raise additional funding before the end of 2000 in
order to increase research and development efforts in response to technology
changes in the industry and to increase sales and marketing expenses based on
the market acceptance of our products and services and the response of
competitors who may develop competing products or services at lower costs. We
currently do not have any commitments for additional financing, and we may
not be able to secure additional funding sources or that financing may not be
made available on terms favorable to us. If we are unable to raise funds
sufficient to fund our activities, we may have to take a number of steps
including substantially reducing or eliminating current and planned system
development programs and other operating plans and, ultimately, closing or
selling the business. Unavailability of additional capital is likely to
result in significant depreciation of your stock holdings in us.
BECAUSE OUR PRODUCT IS SUPPOSED TO PROTECT PROPRIETARY DIGITAL CONTENT,
DEMAND FOR OUR PRODUCT BY OUR LICENSEES OR THEIR CUSTOMERS COULD DECREASE AND
OUR BUSINESS COULD BE ESPECIALLY DAMAGED BY BREACHES IN OUR PATENTED SECURITY
METHODS.
<PAGE>
The secure transmission and trusted management of proprietary information
over the internet is essential to establishing and maintaining confidence in
our product. The basic premise of our product is the prevention of electronic
shoplifting or piracy not just during the initial download of the content,
but when passed from one consumer to another. The actions of hackers, or
other individuals with advanced computer capabilities could result in a
compromise or breach of the security technology, including cryptography
technology, that we use to protect digital content and consumer transaction
data. Failure by our products' patented security methods and processes to
accomplish their main purpose could result in more severe damage to our name,
brand, and image than would be experienced by other internet companies not in
the digital rights management industry. Such breaches could also expose us to
a risk of loss or litigation that may not be adequately covered by our
insurance policies. Even the perceived failure of our products will likely
have these adverse affects. Reduced demand and litigation costs could hurt
our financial results and the market value of our shares.
IF OUR COMPETITORS SIGN EXCLUSIVE LICENSES WITH MAKERS OF NEW READER DEVICES,
WE WOULD BE PREVENTED FROM PROVIDING CONTENT TO THOSE DEVICES. OUR INABILITY
TO OFFER PRODUCTS COMPATIBLE TO POPULAR HARDWARE WOULD HURT OUR OPERATING
RESULTS.
The market for providing digital content on the internet is marked
by rapid technological change, both within the distribution technology as
well as within the reader devices available to consumers. For instance, if a
new reader device is introduced and we are not able to provide content to
such devices due to exclusive arrangements the device maker may have with our
competitors, our business could be seriously harmed and our operating results
could be affected.
IF STANDARDS FOR DIGITAL RIGHTS MANAGEMENT ARE NOT ADOPTED, OUR REVENUES MAY BE
MATERIALLY ADVERSELY AFFECTED.
If standards for digital rights management are not adopted or complied
with, content providers may delay distributing content until they are confident
that the technology by which the content is to be distributed will be
commercially accepted. Standards for the distribution of various digital content
might not develop or might be found to violate antitrust laws or fair use of
copyright policies. In addition, the failure to develop a standard among device
manufacturers may affect the market for digital goods and services. As a result,
customers may delay purchasing products or services that include our technology
if they are uncertain of commercial acceptance of the standards with which our
technology complies. Consequently, if a standard format for the secure delivery
of content on the Internet is not adopted, or if the standards are not
compatible with our digital rights management technology, our business and
operating results could suffer.
WITHIN THE NEXT YEAR, THE SUPPLY OF ACTIVELY-TRADED SHARES COULD INCREASE BY
MORE THAN 6.5 TIMES IF THE HOLDERS OF CURRENTLY OUTSTANDING SHARES OF THE
RESTRICTED STOCK AND CONVERTIBLE PREFERRED STOCK DECIDE TO SELL THEIR SHARES.
THIS COULD DEPRESS YOUR STOCK PRICE AND MAKE IT DIFFICULT FOR US TO RAISE
ADDITIONAL CAPITAL.
Of the 13,071,736 shares of our common stock issued and outstanding
as of August 7, 2000, 9,853,156 shares are "restricted securities" as that
term is defined under Rule 144 promulgated under the Securities Act of 1933.
In addition, we have outstanding 53,435 shares of Series A Preferred Stock
which are convertible into 5,343,500 shares of common stock. The Series A
Preferred Stock will
<PAGE>
complete the one-year holding period of Rule 144 promulgated under the
Securities Act of 1933 in December 2000 through February 2001. We also have
outstanding 46,876 shares of Series B Preferred Stock and warrants which are
convertible into 5,312,600 shares of common stock and constitute a portion of
the shares covered by this registration statement. There are also additional
warrants convertible into common stock outstanding. The holders of the Series
B Preferred Stock have agreed not to sell any of these shares until the
earlier of four months after the date the registration statement, of which
this prospectus is a part, becomes effective or November 1, 2000. This means
that within the next year the supply of our shares could increase by more
than 6.5 times if the holders of the restricted shares and convertible
preferred stock decide to sell their shares. An increase in supply of our
shares is likely to depress our stock's market value. It also may make it
more difficult for us to sell equity securities in the future in order to
raise the additional funding we will need after the 2000 fiscal year.
<PAGE>
FORWARD-LOOKING STATEMENTS
This prospectus contains or incorporates by reference forward-looking
statements. We have based these forward-looking statements on our current
expectations and projections about future events. These forward-looking
statements are subject to risks, uncertainties and assumptions about us,
including, among other things, those described in the "Risk Factors" section of
this prospectus. We caution you that forward-looking statements are necessarily
estimates that reflect the best current judgment of our senior management. These
forward-looking statements involve a number of risks and uncertainties that
could cause actual results to differ materially from those suggested by the
forward-looking statements. We recommend that you consider these forward-looking
statements in light of various important factors, including those set forth in
this prospectus, such as in the "Risk Factors" section and other factors set
forth from time to time in the information that we file with the SEC. To
identify forward-looking statements, you should look for words such as
"estimate," "project," "intend," "expect" or "believe." These forward-looking
statements are found at various places throughout this prospectus and the
documents incorporated by reference in this prospectus. You are cautioned not to
rely to a great extent on these forward-looking statements, which speak only as
of the date of such documents.
We do not undertake to update these forward-looking statements to
reflect actual results, changes and assumptions or other factors that could
affect these statements. In addition, we may from time to time make additional
or revised forward-looking statements about us or our business or about the
matters described or incorporated by reference in this document.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the common stock
offered by the selling shareholders.
SELLING SHAREHOLDERS
The following table lists the name, position, office or other material
relationship which the selling shareholder has had within the past 3 years with
us, if any, and the amount of securities of each class beneficially owned by
that shareholder before the offering.
The second column of the table includes shares issued or issuable upon
conversion of Series A and B Preferred Stock. The third column in the table
below includes common stock issuable upon exercise of two different warrants.
Those shares of common stock underlying the two different warrants are being
registered in the registration statement of which this prospectus is a part. The
first of the two different warrants becomes exercisable for one-half of the
shares of common stock shown in the third column of the following table if as of
August 15, 2000, the registration statement of which this prospectus is a part
has not been declared effective and the listing application for the related
common stock on the Nasdaq exchange has not been accepted. The second warrant
becomes exercisable for the second half of the shares shown in the third column
of the following chart if as of November 15, 2000, these two conditions are not
met. If the two conditions are met prior to August 15, 2000, then all of the
warrants will terminate and the shares will not be available for sale under this
prospectus and the related registration statement. If the two conditions are met
after August 15, 2000, but prior to November 15, 2000, then the second warrant
will terminate and only half of the shares purchasable under the warrants will
be available for sale under this prospectus and the related registration
statement. If the two
<PAGE>
conditions are met after November 15, 2000, all of the shares purchasable under
the warrants will be available for sale under this prospectus and registration
statement. The fourth column in the table below includes only shares of common
stock issued or issuable upon conversion of Series B Preferred Stock and
exercise of certain warrants. The sixth column in the table below does not
contain any numbers because the selling shareholders may offer all or some of
the common stock through the offering contemplated by this prospectus, no
estimate can be given as to the number of shares of common stock that will be
held by the selling shareholders after completion of this offering.
<TABLE>
<CAPTION>
Percentage of
Outstanding
Number of Shares of No. of Shares
Number of Shares of Shares Common Stock Beneficially
Common Stock Issuable Beneficially Owned
Name Beneficially Owned Under Shares Owned Prior to Following
---- Prior to Offering Warrants Offered Offering Offering
----------------- -------- ------- -------- --------
<S> <C> <C> <C> <C>
The Raptor Global Portfolio Ltd. 1,875,000 248,920 2,115,820 12.5%
The Altar Rock Fund L.P. 1,875,000 1,080 9,180 12.5%
Ronald A. Santella 62,500 8,333 70,833 *
Anthony Kamin 62,500 8,333 70,833 *
Ritchie Capital Management, LLC 1,750,000 33,333 283,333 9.9%
RC Capital, LLC 1,750,000 33,333 283,333 9.9%
RAM Trading, Ltd. 1,750,000 166,668 1,416,668 9.9%
SI Venture Fund II, L.P. 2,380,500 62,500 531,300 15.4%
Apex Investment Fund IV, L.P. 1,939,450 60,620 515,320 12.9%
Apex Strategic Partners IV, L.L.C. 1,939,450 1,880 15,980 12.9%
</TABLE>
* less than one percent of our outstanding shares of common stock.
Because the Company understands that Tudor Investment Corporation,
The Raptor Global Portfolio Ltd. and The Altar Rock Fund L.P. are affiliates
of each other under applicable securities laws, the percentage of outstanding
shares of common stock beneficially owned by these entities has been
aggregated to reflect the beneficial ownership of the affiliate entities.
Tudor Investment Corporation acts as general partner and investment advisor
to The Altar Rock Fund L.P. and as investment advisor to The Raptor Global
Portfolio, Ltd. Paul Tudor Jones, II is the Chairman, Chief Executive Officer
and controlling shareholder of Tudor Investment Corporation.
Because Ritchie Capital Management, LLC, RC Capital, LLC and RAM
Trading, Ltd. have affirmed in their filing on Schedule 13G, dated March 15,
2000, that they are members of a group, the percentage of outstanding shares of
common stock beneficially owned has been aggregated to reflect the beneficial
ownership of the affiliate entities. According to letter agreements between the
foregoing entities and us, these entities have agreed that they cannot be the
"beneficial owner" of more than 9.9% of the Company's securities within the
meaning of Regulation 13D.
N. Adam Rin serves as one of our directors and is a managing member of
SI Venture Management II, L.L.C., the general partner of SI Venture Fund II,
L.P.
Because the Company understands that Apex Investment Fund IV,
L.P. and Apex Strategic Partners IV, L.L.C. are affiliates of each other
under applicable securities laws, the percentage of outstanding shares of
common stock beneficially owned by these entities has been aggregated to
reflect the beneficial ownership of the affiliate entities. The sole general
partner of Apex Investment Fund IV, L.P. and the manager of Apex Strategic
Partners IV, L.L.C. is Apex Management IV, LLC ("AMIV"). The managing
members of AMIV are George Middlemas, James A. Johnson, Lon H.H. Chow and
Babu Ranganathan. Also Nancy L. Corrie is a member.
<PAGE>
PLAN OF DISTRIBUTION
The shares of common stock offered under this prospectus may be sold
from time to time by the selling shareholders or persons to whom the selling
shareholders have assigned or transferred their shares after the date of this
prospectus. We will bear all costs, expenses and fees incurred in connection
with the registration of the shares offered by this prospectus. The selling
shareholders will bear only brokerage commissions, selling commissions,
underwriting fees and stock transfer taxes applicable to the shares sold by such
selling shareholder and all fees and disbursements of counsel for the selling
shareholders in excess of $20,000 attributable to the sale of their shares.
Selling shareholders may sell shares from time to time in one or more
types of transactions, including block transactions, in the over-the-counter
market, in negotiated transactions, through put or call options on the shares
and through short sales of shares. Shares may be sold at market prices
prevailing at the time of sale or at negotiated prices. Selling shareholders may
sell shares directly to purchasers or to or through broker-dealers as principals
or agents. These broker-dealers may be compensated through discounts,
concessions or commissions from the selling shareholders or the purchasers of
the shares.
Selling shareholders also may resell all or a portion of the shares in
open market transactions in reliance upon Rule 144 under the Securities Act of
1933 rather than under this prospectus, provided they meet the criteria and
conform to the requirements of Rule 144. In general, under Rule 144, restricted
securities may be sold after a one-year holding period in ordinary market
transactions through a broker or with a market maker subject to a volume
limitation. The volume limitation restricts the number of shares that may be
sold within any three-month period to the greater of (1) 1% of the outstanding
shares or (2) the average of the weekly trading volume during the four calendar
weeks prior to the sale. Sales under Rule 144 require the filing of a Form 144
with the SEC. However, if the shares have been held for more than two years by a
person who is not an affiliate, there is no limitation on the manner of sale or
the volume of shares that may be sold and no filing with the SEC is required.
The selling shareholders have advised us that they have not entered
into any agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their shares, nor is there an underwriter
or coordinating broker acting in connection with the proposed sale of shares by
the selling shareholders.
In connection with the issuance and sale of the shares of Series B
Preferred Stock that are convertible into the shares offered under this
prospectus, the selling shareholders agreed not to sell any of the shares
until the earlier of four months after the registration statement is declared
effective or November 1, 2000. Each selling shareholder also agreed if it has
not sold all the shares offered under this prospectus at the time of any
underwritten public offering of our securities and if it chooses not to sell
all of its shares in that underwritten public offering, it would enter into
an agreement providing that selling shareholder will not transfer or dispose
of its shares for a period specified by the underwriter, but not in excess of
180 days, provided that other shareholders with registration rights and all
of our officers and directors enter into similar agreements.
The selling shareholders and any broker-dealers that act in connection
with the sale of shares might be deemed to be "underwriters" within the meaning
of Section 2(11) of the Securities Act of 1933. We have agreed to indemnify each
selling shareholder against particular liabilities, including liabilities
arising under the Securities Act of 1933 and the selling shareholders have
agreed to indemnify us against certain liabilities, including liabilities
arising under the Securities Act of 1933.
<PAGE>
Because selling shareholders may be deemed to be "underwriters" within
the meaning of Section 2(11) of the Securities Act of 1933, the selling
shareholders will be subject to the prospectus delivery requirements of the
Securities Act of 1933. We have informed the selling shareholders that Rule
10b-5 and the anti-manipulative provisions of Regulation M promulgated under the
Exchange Act may apply to their sales in the market.
DESCRIPTION OF SECURITIES TO BE REGISTERED.
Our authorized capital stock consists of 50,000,000 shares of common
stock, par value $.01 per share, and 5,000,000 shares of preferred stock, par
value $.01 per share. The selling shareholders may offer up to 5,312,600 shares
of common stock issuable upon conversion of the Series B Preferred Stock and
exercise of certain warrants under this prospectus.
As of August 7, 2000, there were 13,071,736 shares of common stock
outstanding and held of record by shareholders.
VOTING RIGHTS. Holders of common stock are entitled to one vote for
each share held on all matters submitted to a vote of shareholders and do not
have cumulative voting rights. Holders of preferred stock are entitled to the
number of votes equal to the number of shares of common stock into which their
preferred stock may be converted.
DIVIDEND RIGHTS AND POLICY. Holders of common stock are entitled to
receive dividends declared by our board of directors out of funds legally
available, subject to any preferential dividend rights of any outstanding
preferred stock. We have not paid any cash dividends on our common stock to date
and do not anticipate payment of cash dividends in the future. We are required
to obtain the approval of the holders of the Series A and Series B Preferred
Stock before declaring any dividends on the common stock as long as certain
amounts of the Series A Preferred Stock and Series B Preferred Stock remain
outstanding.
LIQUIDATION RIGHTS. Upon the liquidation, dissolution or winding up of
our business, the holders of common stock are entitled to receive our net assets
available after the payment of all debts and other liabilities, subject to the
prior rights of any outstanding preferred stock.
OTHER RIGHTS; EFFECT OF PREFERRED STOCK ISSUANCES. Holders of the
common stock have no preemptive, subscription, redemption or conversion rights.
The outstanding shares of common stock are, when issued in consideration for
payment of those shares, fully paid and nonassessable. The rights, preferences
and privileges of holders of common stock are subject to the rights of the
holders of shares of any series of preferred stock which we may designate and
issue in the future.
Our board of directors is authorized, without further shareholder
approval, to issue from time to time up to an aggregate of 5,000,000 shares of
preferred stock in one or more series and to fix or alter the designation,
powers, preferences and rights of each such series and the qualifications,
limitations or restrictions of such series, including the dividend rights,
dividend rates, conversion rights, voting rights, rights and terms of
redemption, including sinking fund provisions, redemption price or prices, and
liquidation preferences of any wholly unissued series of preferred stock and to
establish from time to time the number of shares constituting any series or
designations of series and to increase and decrease the number of shares of any
series subsequent to the issuance of shares of that series, but not below the
number of shares of such series then outstanding.
<PAGE>
The ability of the board of directors to establish the rights of and to
issue substantial amounts of preferred stock without the need for shareholder
approval, while providing desirable flexibility in connection with raising
capital, possible acquisitions or other corporate purposes, may have the effect
of discouraging, delaying or preventing a change in control.
We have issued 53,451 shares of Series A Preferred Stock to a group of
five investors and have issued 46,875 shares of Series B Preferred Stock to a
group of ten investors. The shares of common stock offered under this prospectus
will result from the conversion of the Series B Preferred stock and from the
exercise of certain warrants described in this prospectus.
ANTI-TAKEOVER EFFECTS OF VARIOUS PROVISIONS OF DELAWARE LAW AND
OUR CERTIFICATE OF INCORPORATION AND BYLAWS. We are subject to the provisions
of Section 203 of the Delaware General Corporation Law. Subject to some
exceptions, Section 203 prohibits a publicly held Delaware corporation from
engaging in a "business combination" with an "interested shareholder" for a
period of three years after the date of the transaction in which the person
became an interested shareholder, unless the interested shareholder attained
that status with the approval of the board of directors or unless the
business combination is approved in a prescribed manner. A "business
combination" includes mergers, asset sales and other transactions resulting
in a financial benefit to the interested shareholder. Subject to various
exceptions, an "interested shareholder" is a person who, together with
affiliates and associates, owns, or within three years did own, 15% or more
of the corporation's voting stock. This statute could prohibit or delay the
accomplishment of mergers or other takeovers or change in control attempts
with respect to us and, accordingly, may discourage attempts to acquire us.
In addition, various provisions of our amended and restated
certificate of incorporation, as amended, referred to as our "certificate of
incorporation," and bylaws, which provisions are summarized in the following
paragraphs, may be deemed to have an anti-takeover effect and may delay,
defer or prevent a tender offer or takeover attempt that a shareholder might
consider in its best interest, including those attempts that might result in
a premium over the market price for the shares held by shareholders.
CLASSIFICATION OF THE BOARD OF DIRECTORS; REMOVAL OF DIRECTORS.
Our certificate of incorporation provides that our directors are divided into
three classes serving three year terms. Our certificate of incorporation also
provides that any director or the entire board of directors may be removed
only for cause and by the affirmative vote of the holders of at least 66 2/3%
of the voting power of all then outstanding shares of the voting stock. These
provisions may deter a shareholder from removing incumbent directors and
simultaneously gaining control of the board of directors by filling the
vacancies created by this removal with its own nominees.
SHAREHOLDER ACTION; SPECIAL MEETING OF SHAREHOLDERS. Our certificate of
incorporation provides that shareholders may not take action by written consent.
The bylaws further provide that special meetings of shareholders may be called
by:
- shareholders entitled to cast 25% of all votes
entitled to be cast at the meeting who have requested
the meeting in writing and have delivered the request
to us; or
- the Series A Preferred shareholders who own fifteen
percent (15%) of all outstanding voting shares or
- the Series B Preferred shareholders who own fifteen
percent (15%) of all outstanding voting shares.
The request must include various additional information about the requesting
shareholders and the
<PAGE>
matters to be considered at the meeting. The requesting shareholders are also
required to pay us reasonable estimated costs of preparing and mailing the
notice of meeting. Furthermore, no special meeting may be called to consider
any matter which is substantially the same as a matter voted on at any
special meeting of shareholders held during the prior twelve months unless
the meeting is requested by shareholders entitled to cast a majority of all
votes entitled to be cast at the meeting.
ADVANCE NOTICE REQUIREMENTS FOR SHAREHOLDER PROPOSALS FOR ANNUAL
MEETINGS AND DIRECTOR NOMINATIONS. Our bylaws provide that shareholders seeking
to bring business before an annual meeting of shareholders or to nominate
candidates for election as directors must provide timely notice of such business
or nomination in writing and must be a shareholder of record of a class of
securities entitled to vote on the business the shareholder is proposing both at
the time of giving the notice and on the record date for the annual meeting. A
shareholder's notice must be given by certified U.S. mail postage prepaid and
return receipt requested and addressed to our secretary at our principal
executive offices. To be timely in the case of a shareholder proposal, the
notice must be received not less than 120 days prior to the anniversary of the
date of our notice of annual meeting for the previous year's annual shareholders
meeting, unless the date of the annual shareholders meeting has been changed to
be more than 30 calendar days from the date of the prior year's meeting, in
which case such notice by the shareholder must be received 60 days prior to the
annual meeting of shareholders. To be timely in the case of a director
nomination, the shareholder's notice must be received not less than 120 days
prior to the anniversary of the date of our notice of annual meeting for the
previous year's annual meeting of shareholders:
- on or after April 1st and before May 1st of the year
in which the meeting will be held if the meeting is
to be an annual meeting and the following bullet
point is not applicable; or
- not less than 60 days before an annual meeting, if
the date of the annual meeting has been changed by
more than 30 days; or
- not later than the close of business on the tenth day
following the day on which notice of a special
meeting of shareholders called for that purpose of
electing directors is first given to shareholders.
The bylaws also specify certain requirements as to
the form and content of the shareholder's notice.
These provisions may preclude shareholders from
bringing matters before an annual meeting of
shareholders or from making nominations for
directors.
AUTHORIZED BUT UNISSUED SHARES. Our authorized but unissued shares of
common stock and preferred stock are available for future issuance without
shareholder approval, subject to various limitations as may be imposed by the
securities exchange or quotation system on which the shares are listed. These
additional shares may be utilized for a variety of corporate purposes, including
future offerings to raise additional capital, corporate acquisitions and
employee benefit plans. The existence of authorized but unissued and unreserved
common stock and preferred stock could make more difficult or discourage an
attempt to obtain control of us by means of a proxy contest, tender offer,
merger or otherwise. Since we need to raise additional capital before the end
of 2000 in order to increase research and development efforts and sales and
marketing initiatives, such additional issuances will have a dilutive effect
on outstanding shares.
SUPERMAJORITY VOTE ON CERTAIN MATTERS. The Delaware General Corporation
Law provides generally that the affirmative vote of a majority of the shares
entitled to vote on any matter is required to amend a corporation's certificate
of incorporation or bylaws, unless a corporation's certificate of incorporation
or bylaws, as the case may be, requires a greater percentage. Our certificate of
incorporation requires the affirmative vote of the holders of at least 66 2/3%
of the voting power of all the then outstanding shares of voting stock, voting
as a single class, to alter or amend Article 5, on the board of directors,
Article 6, establishing such supermajority requirement, Article 8, reserving to
us the right to amend or repeal the certificate of incorporation or Article 9,
limiting liability and providing for indemnification of directors, officers and
employees of our certificate of incorporation.
LOW VOLUME TRADING AND VOLATILITY IN OUR STOCK PRICE. We only have
approximately 3 million shares that are currently actively traded on the OTC
bulletin board. Historically, our stock has traded in only small volumes and
has been subject to volatility in price. While we have applied for listing on
the Nasdaq SmallCap Market, we cannot be sure that the listing application
will be accepted, that a more active market will develop or that a
shareholder will be able to liquidate his investment without considerable
delay, if at all. Even should a more active market develop, the price may
remain volatile. Furthermore, a reduced stock price may affect many brokers'
willingness to effect transactions in our securities, particularly because
low-priced securities are subject to an SEC rule that imposes additional
sales practice requirements on broker-dealers who sell low-priced securities
which are generally below $5 per share.
Our stock price may also experience volatility due to the difficulty
of predicting revenues and expenses. Planning the development of our business
and accurately predicting our future revenues and expenses are difficult
because (i) our business model is new and unproven, (ii) new technologies are
constantly being developed that could diminish demand for the SoftLock
system, and (iii) the demand for content enabled under our system and in turn
the transaction fees generated are hard to forecast. Unlike more traditional
businesses that can use the financial data and ratios generated by similar
businesses in the past, our system is a relatively new model without much
historical precedence to aid in forecasting results. Since our revenues are
based in part on transaction fees, accurate forecasting depends on estimating
demand for the various types of content offered through our system. We
experienced the difficulty in predicting demand in March in connection with
the electronic-only distribution of a Stephen King novella. This
unpredictability means that our revenues could fluctuate during any fiscal
year, which may, in turn, cause the price at which our common stock trades to
be subject to substantial volatility.
If our revenue projections are not accurate for a particular
quarter, our actual operating results for that quarter could fall below the
expectations of analysts and investors. Our failure to meet these
expectations would likely cause the market price of our common stock to
decline.
MANAGEMENT'S CONTROL. Our officers and directors own approximately
29% of our outstanding common stock, including those shares of our preferred
stock which are convertible into common stock. As a result, if the officers
and directors act together, they will have significant influence on the
outcome of all matters requiring shareholder approval including the election
and removal of directors and any merger, consolidation or sale of all or
substantially all of our assets and significant influence on our management
and affairs. That influence could discourage others from initiating potential
merger, takeover or other change of control transactions. Such transactions
in many cases include an offer to buy the shares at a significant premium to
the per share market price prior to the proposed transaction. Also an
enterprise's stock price often increases when there are market expectations
that the enterprise is likely to engage in a change of control. Management's
control could therefore have an adverse impact on your ability to receive a
premium price in anticipation of a change in control or in connection with
such a transaction.
<PAGE>
TRANSFER AGENT AND REGISTRAR. Our transfer agent and registrar for the
common stock is Corporate Stock Transfer, Inc.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and information that we file later
with the SEC will automatically update and supersede this information. The
following documents that we filed with the SEC in accordance with the Securities
Exchange Act of 1934 are incorporated into this prospectus by reference and are
delivered, without charge, with this prospectus:
1. Annual Report on Form 10KSB/A (Amendment No. 2) for the
fiscal year ended December 31, 1999
2. Annual Report on Form 10-KSB/A (Amendment No. 1) for the
fiscal year ended December 31, 1999;
3. Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1999, except for Item 7 of that report and the
consolidated financial statements, which have been amended to
include the conformed signature of the independent
accountants;
4. Quarterly Report on Form 10-QSB for the three months ended
March 31, 2000;
5. Current reports on Form 8-K filed on January 13, 2000,
January 18, 2000, February 15, 2000, March 9, 2000,
May 9, 2000 and May 19, 2000 and on Form 8-K/A filed on
July 6, 2000 and July 25, 2000.
6. Notice of Annual Meeting of Shareholders and Definitive Proxy
Statement filed on May 25, 2000.
We also incorporate by reference in this prospectus additional
documents that we may file with the Securities and Exchange Commission under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after
the date of this prospectus. These include periodic reports, such as annual
reports on Form 10-KSB, quarterly reports on Form 10-QSB and current reports on
Form 8-K.
You may obtain the documents incorporated by reference as described
below. You may also request a copy of these filings, at no cost, from us by
writing or telephoning us at:
SOFTLOCK.COM, INC.
CORPORATE SECRETARY
FIVE CLOCK TOWER PLACE, SUITE 440
MAYNARD, MASSACHUSETTS 01754
(978) 461-5940
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the SEC's public reference room at 450 Fifth Street, N.W., Washington, D.C.
20549 and its public reference rooms in New York, New York and Chicago,
Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms. Our SEC filings are also available to the public from
the SEC's website at "http://www.sec.gov."
This prospectus is part of a registration statement we filed with the
SEC. You should rely only on the information or representations provided or
incorporated by reference in this prospectus. We have authorized no one to
provide information other than that provided or incorporated by reference in
this prospectus. We have authorized no one to provide you with different
information. We are not making an offer of shares in any state where the offer
is not permitted. You should not assume that the information
<PAGE>
in this prospectus or any document incorporated by reference into this
prospectus is accurate as of any date other than the date on the front of the
document.
INDEMNIFICATION
Insofar as indemnification arising under Securities Act of 1933 may be
permitted to directors, officers or persons controlling the registrant under to
the foregoing provisions, the registrant has been informed that in the opinion
of the SEC, such indemnification is against public policy as expressed in that
Act and is therefore unenforceable.
VALIDITY OF SECURITIES OFFERED
The validity of the common stock offered under this prospectus has
been passed upon for us by McGuireWoods LLP, Tysons Corner, Virginia.
McGuireWoods LLP owns 3,520 shares of the common stock. No additional shares
of common stock will be issued to McGuireWoods LLP in connection with this
offering.
EXPERTS
The consolidated financial statements incorporated by reference in
this prospectus from the Company's Annual Report on Form 10-KSB/A for the
year ended December 31, 1999 have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their report (which report expressed an
unqualified opinion and includes an explanatory paragraph referring to the
restatement of our 1998 consolidated financial statements) which is
incorporated herein by reference, and has been so incorporated in reliance
upon the report of such firm given upon their authority as experts in
accounting and auditing.
The financial statements of Chili Pepper, Inc., incorporated in this
prospectus by reference from the Company's Report on Form 8-K/A dated July
25, 2000 have been audited by Deloitte & Touche LLP, independent auditors, as
stated in their report, which is incorporated herein by reference and have
been so incorporated in reliance upon the report of such firm given upon
their authority as experts in accounting and auditing.
<PAGE>
<TABLE>
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN
THIS DOCUMENT OR OTHER INFORMATION TO WHICH THIS 5,312,600 SHARES
DOCUMENT REFERS. WE HAVE NOT AUTHORIZED ANYONE TO
PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT. SOFTLOCK.COM, INC.
--------------
COMMON STOCK
TABLE OF CONTENTS
--------------------
PROSPECTUS
PAGE
<S> <C>
Summary..........................................i --------------------
Risk Factors.....................................1
Forward-Looking Statements......................10
Use of Proceeds.................................10
Selling Shareholders............................10
Plan of Distribution............................12
Description of Securities to be Registered......12
Incorporation of Certain Information by
Reference.....................................15
Indemnification.................................16
Validity of Securities Offered..................16
Experts.........................................16
</TABLE>
DEALER PROSPECTUS DELIVERY OBLIGATION
Until _________, all dealers that effect transactions in these
securities, whether or not participating in this offering, may be required to
deliver a prospectus. This is in addition to the dealer's obligation to deliver
a prospectus when acting as underwriters and with respect to their unsold
allotments or subscriptions.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
OTHER EXPENSES
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following expenses will be paid by us in connection with the
distribution of the shares of common stock registered by this registration. We
are paying all of the selling shareholders' expenses related to this offering,
except the selling shareholders will pay any applicable broker's commissions and
expenses, transfer taxes, as well as fees and disbursements of counsel and
experts for the selling shareholders in excess of $20,000. All of our expenses,
except for the SEC filing fees, are estimated:
<TABLE>
<S> <C>
SEC filing fees $ 12,610
Legal fees and expenses $ 50,000
Accounting fees and expenses $ 15,000
Printing and engraving $ 5,000
Blue sky fees and expenses $ 5,000
Transfer agent and registrar fees $ 5,000
Miscellaneous expenses $ 2,000
Total expenses $ 94,610
</TABLE>
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 102(b)(7) of the Delaware General Corporation Law (the "DGCL")
permits a corporation, through its certificate of incorporation, to eliminate
the personal liability of its directors to the corporation or its shareholders
for monetary damages for breach of fiduciary duty as a director, with certain
exceptions. The exceptions include breach of fiduciary duty of loyalty, acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, improper declarations of dividends and transactions from which
the directors derived an improper personal benefit. Section 145 of the DGCL
further establishes a corporation's power to indemnify its directors, officers,
employees or agents.
The Company's amended and restated certificate of incorporation, as
amended, referred to as our "certificate of incorporation," provides that to the
extent permitted by law, the Company shall fully 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, by reason of the fact that such person is or was a director or
officer of the Company, or is or was serving at the request of the Company as a
director or officer of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, against expenses, including
attorneys' fees, judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action, suit or
proceeding.
The certificate of incorporation further provides that Company shall
advance expenses, including attorneys' fees, incurred by a director or officer
in advance of the final disposition of such action, suit or proceeding upon the
receipt of an undertaking by or on behalf of the director or officer to repay
such amount if it shall ultimately be determined that such director or officer
is not entitled to indemnification.
II
<PAGE>
Our bylaws further discuss the right to indemnification and provide
each person who was or is a party or is threatened to be made a party to or is
involved in any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative and whether by or in
the right of the Company or otherwise (a "proceeding"), by reason of the fact
that he or she, or a person of whom he or she is the legal representative, is or
was a director or officer of the Company or is or was serving at the request of
the Company as a director, officer, employee, partner, whether limited or
general, or agent of another corporation or of a partnership, joint venture,
limited liability company, trust or other enterprise, including service with
respect to an employee benefit plan, shall be, and shall be deemed to have a
contractual right to be, indemnified and held harmless by the Company and any
successor to the Company by merger or otherwise to the fullest extent authorized
by, and subject to the conditions and, except as otherwise provided by the
prospectus, procedures set forth in DGCL, as such law may later be amended, but
any such amendment shall not be deemed to limit or prohibit indemnification
rights if such rights would have been permitted by law for acts or omissions
occurring prior to such amendment, against all expenses, liabilities and losses,
including attorneys' fees, judgments, fines, ERISA taxes or penalties and
amounts paid or to be paid in settlement, reasonably incurred by such person in
connection with the proceeding; provided, however, the Company shall indemnify
any such person seeking indemnification in connection with a proceeding
initiated by such persons only if such proceeding was authorized by the board of
directors. Persons who are not directors or officers of the Corporation and are
not so serving at the request of the Corporation may be similarly indemnified in
respect of such service to the extent authorized at any time by the board of
directors. These indemnification rights include the right to be paid in advance
for expenses upon receipt of an undertaking to repay all advanced amounts if it
is later determined that such person was not entitled to indemnification and
such an undertaking is required by the DGCL. The bylaws state that the expenses
incurred by other employees and agents may be paid in advance upon such terms
and conditions deemed appropriate by the board of directors.
These rights to indemnification and advance payment of expenses are not
exclusive of any other rights to indemnification and shall continue as to a
person who has ceased to be a director, officer, employee, partner or agent.
The bylaws give the Company the power to purchase and maintain
insurance on behalf of such persons whether or not the DGCL would give the
Company the power to indemnify such persons.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to our directors, officers and controlling persons
under the foregoing provisions, or otherwise, we have been advised that in the
opinion of the SEC, such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable.
EXHIBITS.
The following exhibits listed on the Exhibit Index on page [II-7] of
this Registration Statement have been previously filed, are filed with this
prospectus, will be filed by amendment, or are incorporated in this prospectus
by reference to other filings:
Exhibit
Number Description
------ -----------
3.1 Amended and Restated Certificate of Incorporation,
filed with the State of
II
<PAGE>
Delaware on August 3, 1998 (incorporated by reference
to Exhibit 3.1 to the Company's Current Report on
Form 8-K, dated July 28, 1998.)
3.2 Amended and Restated Bylaws (incorporated by
reference to Exhibit 5 of the Company's Registration
Statement on Form 8-A filed March 15, 2000.)
3.3 Certificate of Designation of Powers, Preferences and
Rights of the Series A Preferred Stock (incorporated
by reference to Exhibit 99.4 of the Company's Current
Report on Form 8-K dated as of December 30, 1999).
3.4 Amendment No. 1 to Certificate of Designation for
Series A Preferred Stock filed with the Delaware
Secretary of State as of January 13, 2000
(incorporated by reference to Exhibit 99.2 of the
Company's Current Report on Form 8-K dated as of
February 10, 2000).
3.5 The Company's Certificate of Correction to
Certificate of Designation of Powers, Preferences and
Rights of the Series B Preferred Stock, (incorporated
by reference to Exhibit 99.5 of the Company's Current
Report on Form 8-K dated as of February 10, 2000).
5.1* Opinion of McGuireWoods LLP.
10.1 Amended and Restated Shareholders' and Rights
Agreement (incorporated by reference to Exhibit 99.3
of the Company's Current Report on Form 8-K dated as
of February 10, 2000).
10.2 Series B Preferred Stock and Warrant Purchase
Agreement by and among the purchasers listed on the
Schedule of Purchasers, SoftLock, Inc. and SoftLock
Services, Inc. (incorporated by reference to Exhibit
99.4 of the Company's Current Report on Form 8-K
dated as of February 10, 2000).
10.3 Form of Warrant exercisable under certain conditions
on August 15, 2000 (incorporated by reference to
Exhibit 99.7 of the Company's Current Report on Form
8-K dated as of February 10, 2000).
10.4 Form of Warrant exercisable under certain conditions
on November 15, 2000 (incorporated by reference to
Exhibit 99.8 of the Company's Current Report on Form
8-K dated February 10, 2000).
23.1* Consent of Independent Auditors
23.2 Consent of McGuireWoods LLP (included in opinion
filed as Exhibit 5.1)
24 Power of Attorney (included in signature page to this
registration statement)
* Included with this Registration Statement
II
<PAGE>
UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the Registration
Statement, or the most recent post-effective amendment of the
Registration Statement, which, individually or in the
aggregate, represent a fundamental change in the information
set forth in the Registration Statement. However, any increase
or decrease in volume of securities offered, if the total
dollar value of securities offered would not exceed that which
was registered, and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the
form of prospectus filed with the SEC in accordance to Rule
424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration
Fee" table in the effective Registration Statement; and
(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in the Registration Statement or any material change to such
information in the Registration Statement.
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the Registration Statement is on Form S-3, Form S-8 or Form F-3,
and the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished to the
SEC by the Registrant under to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this Registration
Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered in
such post-effective amendment, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering of such securities.
(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.
(b) The undersigned Registrant undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report under to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered in such Registration Statement, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering of such securities.
(c) The undersigned Registrant undertakes to deliver or cause to
be delivered with the prospectus, to each person to whom the prospectus is sent
or given, the last annual report to security holders that is incorporated by
reference in the prospectus and furnished under and meeting the requirements of
Rules
II
<PAGE>
14a-3 or 14c-3 under the Securities Exchange Act of 1934 and where interim
financial information required to be presented by Article 3 of Regulation S-K 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 that
is specifically incorporated by reference in the prospectus to provide such
interim financial information.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant according to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the SEC such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities, other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding, is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-2 and has duly caused this registration
statement or amendment to the registration statement to be signed on its behalf
by the undersigned, duly authorized, in the Town of Maynard, State of
Massachusetts, on this 10th day of August, 2000.
SOFTLOCK.COM, INC.
By /s/ Scott W. Griffith
-------------------------------
Scott W. Griffith,
President and Chief Executive Officer
In accordance with the requirements of the Securities Act of 1933,
this Registration Statement or amendment to the registration statement has
been signed by the following persons in the capacities and on the date
indicated. Each person whose signature block is marked below with an asterisk
has previously appointed either of Douglas R. Johnson and Scott W. Griffith
and each of them singly, as his true and lawful attorney, with full powers to
them and each of them to sign for him in his name and capacity indicated
below, any and all amendments to this registration statement, hereby
ratifying and confirming his signature as it may be signed by said attorneys
to any and all amendments.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Scott W. Griffith Chairman of the Board, President August 10, 2000
-------------------------------------------- and Chief Executive Officer
Scott W. Griffith
* Executive Vice President August 10, 2000
-------------------------------------------- and Chief Financial Officer
Douglas R. Johnson
* Director August 10, 2000
--------------------------------------------
Francis J. Knott
* Director August 10, 2000
--------------------------------------------
Geoffrey de Lesseps
* Director August 10, 2000
--------------------------------------------
Richard N. Gold
II
<PAGE>
* Director August 10, 2000
--------------------------------------------
Jonathan Schull
* Director August 10, 2000
--------------------------------------------
Leigh Michl
* Director August 10, 2000
--------------------------------------------
N. Adam Rin
* By:
/s/ Scott W. Griffith, Attorney in Fact
--------------------------------------------
* Corporate Controller August 10, 2000
-------------------------------------------- (Principal Accounting Officer)
Michael J. Dziczkowski
</TABLE>
II
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EXHIBITS INDEX
Exhibit
Number Description
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3.1 Amended and Restated Certificate of Incorporation,
filed with the State of Delaware on August 3, 1998
(incorporated by reference to Exhibit 3.1 to the
Company's Current Report on Form 8-K, dated July 28,
1998.)
3.2 Amended and Restated Bylaws (incorporated by
reference to Exhibit 5 of the Company's Registration
Statement on Form 8-A filed March 15, 2000.)
3.3 Certificate of Designation of Powers, Preferences and
Rights of the Series A Preferred Stock (incorporated
by reference to Exhibit 99.4 of the Company's Current
Report on Form 8-K dated as of December 30, 1999).
3.4 Amendment No. 1 to Certificate of Designation for
Series A Preferred Stock filed with the Delaware
Secretary of State as of January 13, 2000
(incorporated by reference to Exhibit 99.2 of the
Company's Current Report on Form 8-K dated as of
February 10, 2000).
3.5 The Company's Certificate of Correction to
Certificate of Designation of Powers, Preferences
and Rights of the Series B Preferred Stock,
(incorporated by reference to Exhibit 99.5 of the
Company's Current Report on Form 8-K dated as of
February 10, 2000).
5.1* Opinion of McGuireWoods LLP.
10.1 Amended and Restated Stockholders' and Rights
Agreement (incorporated by reference to Exhibit 99.3
of the Company's Current Report on Form 8-K dated as
of February 10, 2000).
10.2 Series B Preferred Stock and Warrant Purchase
Agreement by and among the purchasers listed on the
Schedule of Purchasers, SoftLock, Inc. and SoftLock
Services, Inc. (incorporated by reference to Exhibit
99.4 of the Company's Current Report on Form 8-K
dated as of February 10, 2000).
10.3 Form of Warrant exercisable under certain conditions
on August 15, 2000 (incorporated by reference to
Exhibit 99.7 of the Company's Current Report on Form
8-K dated as of February 10, 2000).
10.4 Form of Warrant exercisable under certain
conditions on November 15, 2000 (incorporated by
reference to Exhibit 99.8 of the Company's Current
Report on Form 8-K dated February 10, 2000).
16 Letter on Change in Certifying Accountant
(incorporated by reference to Exhibit 16 of the
Company's Current Report on Form 8-K dated as of
January 7, 2000).
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23.1* Consent of Independent Auditors.
23.2 Consent of McGuireWoods LLP (included in opinion
filed as Exhibit 5.1).
24 Power of Attorney (included in signature page to this
registration statement).
* Included with this Registration Statement
