SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event July 10, 1996
reported): ------------------
Spatialight, Inc.
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(Exact Name of Registrant as Specified in Charter)
New York 000-19828 16-1363082
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(State or Other (Commission File (IRS Employer
Jurisdiction Number) Identification
of Incorporation) No.)
8-C Commercial Boulevard, Novato, California 94949
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including (415)-883-1693
area code: ---------------------
16 Digital Drive, #202, Novato, California 94949
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(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
Item 5. Other Events.
On July 10, 1996, the Company executed definitive documents relating
to the sale of 2,000,000 shares of its common stock, par value $.01, to three
(3) separate investors for a per-share price of $1.125. Pursuant to the
Agreement, the Company also granted Warrants to purchase an additional 2,000,000
shares, exercisable at any time prior to July 15, 2001 at a strike price of
$1.00 before July 15, 1997, $1.25 through July 15, 1999 and $1.50 thereafter.
The closings of the purchases and transfer of funds totalling $1,783,125
occurred on July 11, 1996; the remaining $466,875 is anticipated to be closed on
July 22, 1996. The Company has agreed to register the shares and the shares
underlying the Warrants within 90 days following closing.
Attached to this report is a pro-forma balance sheet reflecting the
effect of the sale of stock as of May 31, 1996.
The Company does not believe that this transaction represents a change
in control of the Company. The Company has been informed that the investors are
not related parties nor acting in concert. The largest investor in the
transaction owns less than 10% of the outstanding shares of the Company. After
exercise of the Warrants, no individual new investor would own more than 17.5%
of the then-outstanding stock. The Company's largest shareholder, Raymond L.
Bauch, would own 24% of the outstanding stock, giving effect to exercise of all
of the Warrants. Therefore, the Company believes that no change of control has
occurred.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits
(a) Financial Statements of Business Acquired. Not required.
(b) The registrant provides herewith the pro forma condensed balance
sheet of the Company as of May 31, 1996, to reflect the effect, pro forma, of
the net investment in the Company.
(c) Exhibits.
Exhibit 4.5 Form of Warrant
Exhibit 10.32 Form of Share Purchase Agreement.
<PAGE>
SPATIALIGHT, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET WITH THE EFFECTS OF THE EQUITY
INVESTMENT (UNAUDITED)
The pro forma condensed consolidated balance sheet was prepared giving effect to
the equity investment, net of estimated costs, as if such transaction occurred
as of May 31, 1996. The financial data does not purport to represent what the
Company's financial position would have actually been if the transaction, in
fact, had occurred on such date or to project the Company's financial position
for any future date.
<TABLE><CAPTION>
ADJUSTMENT PRO FORMA
FOR THE AT
AT MAY 31, EQUITY MAY 31,
1996 INVESTMENT 1996
ASSETS (A)
Current assets:
<S> <C> <C> <C>
Cash and cash equivalents $ 390,012 $ 2,200,000 $ 2,590,012
Accounts receivable 81,755 81,755
Note receivable - current 43,003 43,003
Prepaid expenses and other 45,251 45,251
------------ ------------ ------------
Total current assets 560,021 2,200,000 2,760,021
------------ ------------ ------------
Property and equipment, net 44,486 44,486
Note receivable - noncurrent 206,997 206,997
Other assets 22,272 22,272
============ ============ ============
Total assets $ 833,776 $ 2,200,000 $ 3,033,776
============ ============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accrued expenses and other current
liabilities $ 104,556 $ 104,556
Deferred revenue 50,000 50,000
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Total current liabilities 154,556 154,556
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Stockholders' equity:
Common stock, $.01 par value 63,532 $ 20,000 83,532
Additional paid-in capital 9,855,602 2,180,000 12,035,602
Accumulated deficit (9,239,914) (9,239,914)
------------ ------------ ------------
Total stockholders' equity 679,220 2,200,000 2,879,220
============ ============ ============
Total liabilities and stockholders'
equity $ 833,776 $ 2,200,000 $ 3,033,776
============ ============ ============
</TABLE>
(A) Adjustment reflects the $2,500,000 proceeds from the sale of 2,000,000
shares of $.01 par value common stock for $1.25 per share less estimates for
costs for consummation of the agreement and sale and registration of the shares.
<PAGE>
EXHIBIT INDEX
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EXHIBIT
NO. DESCRIPTION
- -------- ------------
4.5 Form of Warrant
10.32 Form of Share Purchase Agreement.
Exhibit 4.5
Form of Warrant
Agreement and Warrant to Purchase _______ Common Shares
Spatialight, Inc.
This certifies that, for value received, __________________, the
registered holder hereof (the "Warrantholder") is entitled to purchase
from Spatialight, Inc., a New York corporation with its principal
office at 8-C Commercial Boulevard, Novato, California 94949 (the
"Company") ________________ (_______) shares of common stock of the
Company (the "Shares") at or before 5:00 p.m. Eastern Standard Time on
July 15, 2001 at the purchase price per share of $1.00 if exercised on
or before July15, 1997, $1.25 if exercised between July 16, 1997
through July 15, 1999, and $1.50 thereafter (the "Warrant Price"),
subject to the following terms and conditions. The number of Shares
purchasable upon exercise of this Warrant and the Warrant Price per
Share shall be subject to adjustment from time to time as set forth
herein.
1. Consideration for Warrant.
This Warrant is granted in connection with the purchase by
Warrant holder of ____ shares of common stock of
Spatialight, Inc., pursuant to the Share Purchase Agreement
dated July ___, 1996.
2. Exercise.
This Warrant may be exercised in whole or in part at any
time by presentation of this Warrant with the Purchase Form
as attached hereto duly completed and executed, together
with payment of the Warrant Price at the principal office of
the Company, provided that prior to July 15, 1997, the
Warrantholder may exercise this Warrant only to the extent
that, following such exercise, the Warrantholder would own
less than 9.9 percent of the then outstanding stock of the
Company. Payment of the Warrant Price may be made in cash,
by wire transfer or by check. Upon surrender of the Warrant
and payment of such Warrant Price as aforesaid, the Company
shall issue and cause to be delivered with all reasonable
dispatch to or upon the written order of the Warrantholder
and in such name or names as the Warrantholder may designate
a certificate or certificates for the number of full Shares
so purchased upon the exercise of the Warrant, together with
Fractional Warrants, as provided in Section 8 hereof, in
respect of any fractional Shares otherwise issuable upon
such surrender. 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 a holder of
record of such Shares as of the date of the surrender of the
Warrant and the payment of the Warrant Price, as aforesaid,
notwithstanding that the certificates representing the
Shares shall not actually have been delivered or that the
stock transfer books of the Company shall then be closed.
The Warrant shall be exercisable, at the election of the
Warrantholder, either in full or from time to time in part
and, in the event that a certificate evidencing the Warrant
is exercised in respect of less than all of the Shares
specified therein at any time prior to the Termination Date,
a new certificate evidencing the remaining Warrant will be
issued by the Company. The Company shall pay
<PAGE>
any and all transfer taxes or similar charges which may become due
upon exercise of the Warrant.
3. Reservation of Shares.
There has been reserved, and the Company shall at all times keep
reserved so long as the Warrant remains outstanding, out of
its authorized Common Shares, such number of Shares as shall
be subject to purchase under the Warrant. Every transfer
agent for the Common Shares and other securities of the
Company issuable upon the exercise of the Warrant will be
irrevocably authorized and directed at all times to reserve
such number of authorized Shares and other securities as
shall be requisite for such purpose. The Company will keep
a copy of this Warrant on file with every transfer agent for
the Common Shares and other securities of the Company
issuable upon the exercise of the Warrant. The Company will
supply such transfer agent with duly executed stock and
other certificates for such purpose.
4. Further Obligations of Company.
4.1 The Company covenants and agrees that all Shares which
may be delivered upon exercise of this Warrant shall, upon
delivery, be fully paid and non-assessable, and be free from
all taxes, liens and charges with respect to the purchase
thereof hereunder, and without limiting the generality of
the foregoing, the Company covenants and agrees that it
shall from time to time take all such action as may be
necessary to assure that the par value per share of the
Common Shares is at all times equal to or less than the then
current Warrant Price per share of the Common Shares
issuable pursuant to this Warrant.
4.2 If the Warrantholder claims that this Warrant has
been mutilated, lost, destroyed or wrongfully taken,
the Company shall issue and deliver to the
Warrantholder a replacement Warrant provided that the
requirements of Section 8-405 of the New York Uniform
Commercial Code has been met and, if this Warrant has
been mutilated, that it is surrendered to the Company.
4.3 So long as the Warrants are outstanding, the
Company shall not issue any additional Shares or
securities convertible into Shares (with the exception
of Shares issuable upon exercise of options issued
under the Company's existing stock option plans)
without the consent of the Warrantholder. This
restriction shall not apply, however, if the average
closing price of the Company' common stock for the
five days preceding the proposed issuance exceeds
$5.00.
5. Registration and Transfer.
The Warrant shall be registered on the books of the Company when issued and
shall be transferable only on the books of the Company maintained at its
principal office in Rochester, New York, or wherever its principal executive
offices may then be located, upon delivery thereof duly endorsed by the
Warrantholder or its duly authorized attorney or representative, or accompanied
by proper evidence of succession, assignment or authority to transfer. Upon any
<PAGE>
registration or transfer, the Company shall execute and deliver a new Warrant
to the person entitled thereto.
6. Exchange of Warrant Certificate.
This Warrant certificate may be exchanged for another certificate or
certificates entitling the Warrantholder to purchase a like aggregate
number of Shares as the certificate or certificates surrendered then
entitled the Warrantholder to purchase. The Warrantholder desiring to
exchange a Warrant certificate shall make such request in writing
delivered to the Company, and shall surrender, properly endorsed, the
certificate evidencing the Warrant to be so exchanged. Thereupon, the
Company shall execute and deliver to the person entitled thereto a new
Warrant certificate as so requested.
7. Adjustment of Warrant Price and Number of Shares.
7.1 General. The number of Shares purchasable upon
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the exercise of the Warrant and the Warrant Price shall be subject
to adjustment from time to time upon the happening of certain
events, as follows:
7.1.1. In case the Company shall, with regard to its Common
Shares (or securities convertible into or exchangeable for
Common Shares) (A) pay a dividend in Common Shares or make
a distribution in Common Shares, (B) subdivide its
outstanding Common Shares into a greater number of Shares,
(C) combine its outstanding Common Shares into a smaller
number of Common Shares, or (D) issue by reclassification
of its Common Shares other securities of the Company, the
number of Shares purchasable upon exercise of the Warrant
immediately prior thereto shall be adjusted so that the
Warrantholder shall be entitled to receive the kind and
number of Shares or other securities of the Company which
it would have owned or would have been entitled to receive
after the happening of any of the events described above,
had the Warrant been exercised immediately prior to the
happening of such event or any record date with respect
thereto. Any adjustment made pursuant to this subsection
shall become effective immediately after the effective date
of such event retroactive to the record date, if any, for
such event.
7.1.2. No adjustment in the number of Shares purchasable hereunder
shall be required unless such adjustment would require an
increase or decrease of at least one percent in the
aggregate number of Shares then purchasable upon the
exercise of the Warrant; provided however, that any
adjustments which by reason of this Section 7.12 are not
required to be made immediately shall be carried forward
and taken into account in any subsequent adjustment.
7.1.3. Whenever the number of Shares purchasable upon the
exercise of the Warrant is adjusted as herein provided,
the Warrant Price payable
<PAGE>
upon exercise of the Warrant shall be adjusted by
multiplying such Warrant Price immediately prior to such
adjustment by a fraction, of which the numerator shall be
the number of Shares purchasable upon the exercise of the
Warrant immediately prior to such adjustment, and of which
the denominator shall be the number of shares so
purchasable immediately thereafter.
7.1.4. Whenever the number of Shares purchasable upon the exercise
of this Warrant or the Warrant Price is adjusted as herein
provided, the Company shall cause to be promptly mailed to
the Warrantholder in accordance with the provisions of
Section 11 hereof, notice of such adjustment or adjustments
and a certificate of a firm of independent public
accountants selected by the Board of Directors of the
Company (who may be the regular accountants employed by the
Company) setting forth the number of Shares purchasable
upon the exercise of the Warrant and the Warrant Price
after such adjustment, a brief statement of the facts
requiring such adjustment, and the computation by which
such adjustment was made.
7.1.5. For the purpose of this Section 7.1, the term "Common
Shares" shall mean (A) the class of shares designated as
the Common Shares of the Company at the date of this
Agreement, or (B) any other class of shares resulting from
successive changes or reclassifications of such Common
Shares including changes in par value, or from par value to
no par value, or from no par value to par value. In the
event that at any time, as a result of an adjustment made
pursuant to this Section 7, the Warrantholder shall become
entitled to purchase any shares of the Company other than
Common Shares, thereafter the number of such other shares
so purchasable upon exercise of the Warrant and the Warrant
Price of such shares shall be subject to adjustment from
time to time in a manner and on terms as nearly equivalent
as practicable to the provisions with respect to the Shares
contained in this Section 7.
7.2. No Adjustment of Dividends. Except as provided in Section 7.1, no
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adjustment in respect of dividends shall be made during the term
of the Warrant or upon the exercise of the Warrant.
7.3. Preservation of Purchase Rights upon Reorganization,
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Reclassification, Consolidation, Merger, etc. In case of any
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capital reorganization or reclassification of the Common Shares
of the Company, or in case of any consolidation of the Company
with or merger of the Company into another corporation or in case
of any sale or conveyance to another person of the property,
assets or business of the Company as an entirety or substantially
as an entirety, the Company or such successor or purchaser, as
the case may be, shall
<PAGE>
execute with the Warrantholder an agreement that the
Warrantholder shall have the right thereafter upon payment of the
Warrant Price in effect immediately prior to such action to
purchase upon exercise of the Warrant the kind and amount of
shares and other securities and property which it would have
owned or have been entitled to receive after the happening of
such reorganization or reclassification, consolidation, merger,
sale or conveyance had the Warrant been exercised immediately
prior to such action. In the event of a merger described in
Section 368(a)(2)(E) of the Internal Revenue Code of 1986, as
amended, in which the Company is the surviving corporation, the
right to purchase Shares under the Warrant shall terminate on the
date of such merger and thereupon the Warrant shall become null
and void but only if the controlling corporation shall agree to
substitute for the Warrant its warrant which entitles the holder
thereof to purchase upon its exercise the kind and amount of
shares and other securities and property which it would have
owned or had been entitled to receive had the Warrant been
exercised immediately prior to such merger. The adjustments
required by this Section 7.3 shall be effected in a manner which
shall be as nearly equivalent as may be practicable to the
adjustments provided for elsewhere in this Section 7. The
provisions of this Section 7.3 shall similarly apply to
successive consolidations, mergers, sales or conveyances.
7.4. Statement on Warrants. Irrespective of any adjustments in the
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Warrant Price or the number or kind of Shares purchasable upon
the exercise of the Warrant, the Warrant certificate or
certificates theretofore or thereafter issued may continue to
express the same price and number and kind of Shares as are
stated in this initially issued Warrant.
8. Fractional Shares.
The Company shall not be required to issue fractional Shares on the
exercise of the Warrant. If any fraction of a Share would, except for
the provisions of this Section 8, be issuable on the exercise of the
Warrant (or specified portion thereof), the Company shall issue to the
Warrantholder a fractional Warrant entitling Warrantholder, upon
surrender with other fractional Warrants aggregating one or more full
Shares, to purchase such full Shares. If fractional Warrants do not
aggregate a full Share, their value (over and above their exercise
price) shall be paid in full in cash upon exercise to the exercising
Warrantholder.
9. Registration.
9.1. The Company agrees that it will immediately prepare and file a
registration statement under the Securities Act of 1933 (the
"Act") covering all of the Shares together with the shares
purchased by the Warrant holder pursuant to the Shares Purchase
Agreement and will use its best efforts to cause such
registration statement to become effective as soon as practicable
(but no later than October 15, 1996) and to remain effective and
current, and take all other action necessary under any Federal or
state law or regulation of any governmental authority,
<PAGE>
including but not limited to the filing of post effective
amendments, if necessary, to permit all Warrant Shares to be sold
or otherwise disposed of and will maintain such compliance with
each such Federal and state law and regulation of any
governmental authority for the period necessary for the Holder
and such Holders to effect the sale or disposition thereof.
9.2. To the extent not registered under Section 9.1 above, if at any
time before July 15, 2001, the Company proposes to register or
qualify any of its securities under the Act or any other
applicable federal or state law or regulation of governmental
authority, it will each such time give written notice to all the
then holders of this Warrant, if this Warrant has not yet
expired, and to all holders of Shares acquired by reason of
exercise of this Warrant, of its intention to do so and, upon the
written request of any such holder given within thirty (30) days
after receipt of any such notice (which request shall specify the
number of Shares intended to be sold or disposed of and describe
the nature of any proposed sale or other disposition thereof),
the Company will use its best efforts to cause such Shares so
specified to be registered or qualified under such laws or
regulations, to the extent requisite to permit the sale or other
disposition thereof (in accordance with the method described by
such holder, provided such method is in accordance with law). The
Company will keep effective and maintain any registration or
qualification specified in this Section 9.2 for a period of not
less than six months.
9.3. Whenever the Company is required by the provisions of Section 9.1
or 9.2 of this Section 9 to effect a registration or
qualification of any Shares, the Company will furnish to each
holder whose Shares are the subject of such registration or
qualification such number of copies of any prospectus (including
any preliminary or summary prospectus) or other like document as
such holder may reasonably request in order to effect the sale of
the securities to be sold by such holder, and will use its best
efforts to qualify such securities under such state securities or
Blue Sky laws as may be requisite for such purpose. All expenses
incurred by the Company in connection with any registration or
qualification, including registration or filing fees, printing
expenses and fees, compensation of regular employees of the
Company and disbursements of counsel and of independent
accountants of the Company shall be borne by the Company.
Underwriters' commissions (if any) and the fees of counsel for
any holder of Shares subject to such registration or
qualification shall be borne (in such respective amounts as shall
be determined by them) by the person or persons requesting such
registration or qualification pursuant to this Section 9.
9.4. Each holder whose securities are the subject of registration or
qualification under this Section 9 agrees to furnish to the
Company such information concerning such holder as may be
requested by the Company which is necessary in connection with
any such registration or qualification.
<PAGE>
9.5 In the event that the Company shall be obligated to use its best
efforts to effect any registration or qualification under either
Section 9.1 or 9.2:
9.5.1. The Company will indemnify and hold harmless each
holder whose securities are the subject of a
registration or qualification under this Section 9 and
each underwriter of the securities so registered or
qualified (including any broker or dealer through whom
such securities may be sold) and each person, if any,
who controls any such holder or any such underwriter
within the meaning of Section 15 of the Act, from and
against any and all losses, claims, damages, expenses
or liabilities, joint or several, to which they or any
of them may become subject under the Act or under any
other statute or at common law or otherwise, and except
as hereinafter provided, will reimburse each such
holder and each of the underwriters and each such
controlling person, if any, for any legal or other
expenses reasonably incurred by them or any of them in
connection with investigating or defending any actions,
whether or not resulting in any liability, insofar as
such losses, claims, damages, expenses, liabilities or
actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material
fact contained in the registration statement, in any
preliminary or amended preliminary prospectus or in the
prospectus (or the registration statement or prospectus
as from time to time amended or supplemented by the
Company), or arise out of or are based upon the
omission or alleged omission to state therein a
material fact required to be stated therein or
necessary in order to make the statements therein not
misleading, unless such untrue statement or omission
was made in such registration statement, preliminary or
amended preliminary prospectus or prospectus in
reliance upon and in conformity with information
furnished in writing to the Company in connection
therewith by such holder or any underwriter expressly
for use therein. Promptly after receipt by any holder
or any underwriter or any person controlling such
holder or such underwriter of notice of the
commencement of any action in respect of which
indemnity may be sought against the Company, such
holder or such underwriter, as the case may be, will
notify the Company in writing of the commencement
thereof, and subject to the provisions hereinafter
stated, the Company shall assume the defense of such
action (including the employment of counsel, who shall
be counsel satisfactory to such holder or such
underwriter or such person, as the case may be), and
the payment of expenses insofar as such action shall
relate to any alleged liability in respect of which
indemnity may be sought against the Company. Each
holder or any underwriter or any such controlling
person shall have the right to employ separate counsel
in any such action and to participate in the defense
thereof
<PAGE>
but the fees and expenses of such counsel shall not be
at the expense of the Company unless the employment of
such counsel has been specifically authorized by the
Company. The Company shall not be liable to indemnify
any person for any settlement of any such action
effected without the Company's consent; and
9.5.2. each holder will indemnify and hold harmless the
Company, each of its directors, each of its officers
who has signed the registration statement and each
person, if any, who controls the Company within the
meaning of Section 15 of the Act from and against any
and all losses, claims, damages, expenses or
liabilities, joint or several, to which they or any of
them may become subject under the Act or under any
other statute or at common law or otherwise, and except
as hereinafter provided, will reimburse the Company and
each such director, officer or controlling person for
any legal or other expenses reasonably incurred by them
or any of them in connection with investigating or
defending any actions whether or not resulting in any
liability, insofar as such losses, claims, damages,
expenses, liabilities or actions arise out of or are
based upon any untrue statement or alleged untrue
statement of a material fact contained in the
registration statement, in any preliminary or amended
preliminary prospectus or in the prospectus (or the
registration statement or prospectus as from time to
time amended or supplemented) or arise out of or are
based upon the omission or alleged omission to state
therein a material fact required to be stated therein
or necessary in order to make the statements therein
not misleading, but only insofar as any such statement
or omission was made in reliance upon and in conformity
with information furnished in writing to the Company in
connection therewith by such holder expressly for use
therein. Promptly after receipt of notice of the
commencement of any action in respect of which
indemnity may be sought against any holder, the Company
will notify such holder in writing of the commencement
thereof, and such holder, the Company will notify such
holder in writing of the commencement thereof, and such
holder shall, subject to the provisions hereinafter
stated, assume the defense of such action (including
the employment of counsel, who shall be counsel
satisfactory to the Company) and the payment of
expenses insofar as such action shall relate to an
alleged liability in respect of which indemnity may be
sought against such holder. The Company and each such
director, officer or controlling person shall have the
right to employ separate counsel in any such action and
to participate in the defense thereof but the fees and
expenses of such counsel shall not be at such holder's
expense unless the employment of such counsel has been
specifically authorized by such holder. Such holder
<PAGE>
shall not be liable to indemnify any person for any
settlement of any such action effected without such
holder's consent.
10. No Rights as Shareholder; Notices to Warrantholder.
Nothing contained in this Agreement or in any of the Warrants shall be
construed as conferring upon the Warrantholder or its transferees any
rights as a shareholder of the Company, including the right to vote,
receive dividends, or consent as a shareholder in respect of any
meeting of shareholders for the election of directors of the Company
or any other matter. However, the Company shall be required to give
notice in writing to the Warrantholder of any meeting of shareholders
of the Company or any proposed consent of the shareholders as provided
in Section 11 hereof at least twenty (20) days prior to the date fixed
as a record date or the date of closing the transfer books for the
determination of the shareholders entitled to any relevant dividend,
distribution, subscription rights or other rights or for the
determination of shareholders entitled to vote at any such meeting or
as to which any consent is requested. Such notice shall specify such
record date or the date of closing the transfer books, as the case may
be.
11. Notices.
Any notice pursuant to this Agreement by the Company or by the
Warrantholder shall be in writing and shall be deemed to have been
duly given if delivered by hand or if mailed by certified mail, return
receipt requested, postage prepaid, addressed as follows:
11. If to the Warrantholder - addressed to
____________________________________________________________
11.2 If to the Company - addressed to Spatialight, Inc., 8-C
Commercial Boulevard, Novato, California 94949, or to such other
address as any such party may designate by notice to the other
party. Notices shall be deemed given at the time they are
delivered personally or three days after they are mailed in the
manner set forth above.
12. Successors.
All the covenants and provisions of this Agreement by or for the
benefit of the Company or the Warrantholder shall bind and
inure to the benefit of their respective successors and
assigns hereunder.
13. Merger or Consolidation of the Company.
The Company will not merge or consolidate with or into any
other corporation or sell all or substantially all of its
property to another person, unless the provisions of Section
7.3 are complied with.
14. Applicable Law.
<PAGE>
This Agreement shall be deemed to be a contract made under
the laws of the State of New York and for all purposes shall
be construed in accordance with the laws of said State
applicable to contracts made and to be performed entirely
within such State.
15. Counterparts.
This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together
shall constitute one and the same instrument.
16. Further Assurances.
From time to time after the Closing, the Company shall
promptly execute and deliver to each Warrantholder such
further agreements, assurances or other instruments of
transfer as the Warrantholder may reasonably request in
order to vest and confirm ownership of the Shares and the
Warrants in the Warrantholder and to effectuate the
purposes, terms and conditions of this Agreement.17.
17. Headings.
The headings in this Agreement are for reference purposes
only and shall not affect in any way the meaning or
interpretation of this Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant to be
executed by its duly authorized officers and the corporate seal
hereunto fixed.
SPATIALIGHT, INC.
(corporate seal)
By: _________________________
Attest: William E. Hollis
President
___________________
Alan S. Lockwood
Secretary
Exhibit 10.32
Form of Share Purchase Agreement
SHARE PURCHASE AGREEMENT
This Share Purchase Agreement is made the ___ day of July,
1996, by and between Spatialight, Inc., a New York corporation
with a principal place of business at 8-C Commercial Boulevard,
Novato, California 94949 ("Spatialight") and ______________ (the
"Investor").
RECITALS
The Investor desires to purchase and Company desires to issue
and sell _________ shares of common stock, par value $.01, of the
Company (the "Shares") together with Warrants to purchase
additional ___________ shares for the consideration recited in
this Agreement.
I. Sale of the Shares; Purchase Price; Payment and Security
A. Subject to the terms and conditions hereof, the
Company will sell to the Investor, and the Investor
will purchase, the Shares and Warrants for the Purchase
Price set forth herein on the Closing Date. The
Investor will purchase that number of Shares and
Warrants set forth below.. .
B. The Purchase Price shall be $1.125 per share, or
an aggregate of $__________, payable in cash upon
delivery of the stock.
II. Closing Date and Delivery
A. Closing Date. The closing of the purchase and
sale of the Shares (the "Closing") shall be held at 14
East 82nd Street, New York, New York, on or before July
15, 1996 (the "Closing Date").
B. Delivery. At the Closing, the Company will
deliver to Investor certificate for the Shares and an
executed Warrant Agreement representing the securities.
The Investor shall deliver to the Company the Purchase
Price, by wire transfer to coordinates provided by the
Company.
III. Representations and Warranties of the Company. The
Company represents and warrants to the Investor as follows:
A. Organization and Standing. Spatialight, Inc. is a
corporation duly organized and validly existing under
the laws of the State of New York and is in good
standing as a domestic corporation under the laws of
said state, is qualified to do business in each
jurisdiction in which failure to so qualify would have
a material adverse effect on the Company, and has the
corporate power and authority to own or lease its
properties and to carry on its business as now being
conducted. Each of the subsidiaries identified in the
Company's Form 10-K for the fiscal year ended December
31, 1995 ("1995 10-K") is a corporation duly organized,
validly existing and in good standing under the laws of
the jurisdiction of its incorporation is qualified to
do business in each jurisdiction in which failure to so
qualify would have a material adverse effect on such
subsidiary, and has the power and authority
<PAGE>
to own or lease and operate its properties and to carry on its
business as now being conducted.
B. Authorization. The execution, delivery and performance of this
Agreement, and the issuance and delivery of the Shares and
Warrants by the Company have been duly authorized by all
requisite corporate action, and this Agreement constitutes a
valid and binding obligation of the Company enforceable in
accordance with its terms, subject as to enforcement of remedies
to applicable bankruptcy, insolvency, reorganization or similar
laws relating to or affecting the enforcement of creditors'
rights.
C. No Violation. The execution, delivery and performance of this
Agreement will not violate any provisions of the Certificate of
Incorporation or by- laws of the Company, or cause default under
any agreement or instrument to which the Company is a party or by
which any of its property or assets is bound, or any order, rule
or regulation to which the Company is a party or by which they
may be bound.
D. Capitalization. The authorized capital stock of the Company
consists of 20,000,000 shares of Common Stock, par value of $.01
per share, of which 6,353,191 shares are issued and outstanding
on the date of this Agreement and there are no shares held in the
treasury. All outstanding shares of Common Stock of the Company
are duly authorized and validly issued, fully paid and
non-assessable and have not been issued in violation of any
pre-emptive rights of stockholders. All of the issued and
outstanding shares of capital stock of the subsidiaries of the
Company are duly authorized and validly issued, are fully paid
and non-assessable and have not been issued in violation of any
pre-emptive rights of stockholders, and are owned by the Company
free and clear of all liens, charges, claims and encumbrances.
E. Voting Agreements; Stockholders' Agreements. There are no voting
trusts or other agreements or undertakings with respect to the
voting of the Common Stock.
F. Options. Except for options to purchase an aggregate of 550,000
shares of the Company's Common Stock outstanding pursuant to the
Company's 1991 Stock Option Plan, 1993 Employee Stock Option Plan
and 1993 Director Stock Option Plan, there are no outstanding
subscriptions, options, warrants, rights or other agreements or
commitments providing for the issuance of, or the granting of
rights to acquire from the Company, any shares of Common Stock of
the Company or any securities convertible into or exchangeable
for, Common Stock of the Company. All shares of the Company's
Common Stock reserved or issuance upon exercise of outstanding
options, are issuable without violation of any pre-emptive rights
of stockholders.
G. No Breach of Statute or Contract; Governmental Authorization.
Neither the execution and delivery of this Agreement nor
compliance with the terms and conditions hereof by the Company
will breach any statute or regulation of any governmental
authority, domestic or foreign, or will result in a breach of any
term,
<PAGE>
condition or provision of any judgment, order, injunction, decree
or ruling of any court or governmental authority, domestic or
foreign, to which the Company is a party or by which it is bound
or constitute a material default thereunder, in each case the
breach of which or default thereunder would have, or in the
future would have, a materially adverse effect upon the Company,
or give to others any interest or right, in or with respect to
any of the properties, assets, in or with respect to any of the
properties, assets, agreements, contracts or business operations
of the Company.
H. Prospectuses; Proxy Statements; SEC Reports. The Company has
previously furnished to the Investor true and complete copies of
(1) the definitive proxy statement filed by the Company with the
Securities and Exchange Commission ("SEC") dated April 15, 1996,
for the annual meeting of stockholders; and (b) the Company's
1995 10-K, the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1996 (the "First Quarter 10-Q") and all
other reports filed by the Company with the SEC on or after March
31, 1996; all documents listed in subsections (a) and (b)
together with all exhibits thereto being referred to collectively
as the "Company's SEC filings". The Company has duly filed all
reports required to be filed by it with the SEC under the
Securities Exchange Act of 1934, as amended (the "1934 Act"). The
Company's SEC filings and all such reports are complete and
correct in all material respects, conform in all material
respects to the requirements of the 1934 Act and the rules and
regulations promulgated thereunder and at the time they were
filed did not contain any untrue statements of a material fact or
fail to state any material facts necessary to make the statements
therein, in light of the circumstances under which they were
made, not misleading, except that the SEC has notified the
Company that it neglected to file a Financial Data Schedule with
its Form 10-Q for the period ended March 31, 1996 (which
Financial Data Schedule shall be prepared and filed as soon as
practicable). All amendments, if any, required to update the
Company's SEC filings have been filed.
I. NASDAQ Filings. The Company has made all necessary filings with
the NASDAQ Stock Market, and is current in all such filings. The
Company has received no notices of violation from the NASD,
except that NASD has notified the Company that its net capital
falls below the minimum for continued listing as a NASDAQ Small
Cap stock. The consummation of the transactions contemplated
herein will cure the deficiency.
J. Financial Statements. The Company has previously furnished to
Investor a true and complete copy of its 1995 10-K and First
Quarter 10-Q. The audited consolidated financial statements
included in the 1995 10-K and, subject to normal adjustments not
material in amount or effect, the necessity of which an audit
would reveal, the unaudited financial statements included in the
First Quarter 10-Q fairly present the consolidated financial
position of the Company and its subsidiaries and results of
operations for the respective periods or as of the respective
dates therein set forth, in accordance with generally accepted
accounting principles consistently applied during the periods
involved (except as otherwise stated therein). There has
<PAGE>
not been any change between March 31, 1996 and the date of this
Agreement which has affected materially or adversely the business
or properties or condition, financial or other, or results of
operation of the Company, and no fact or condition exists or, to
the knowledge of the Company, is contemplated or threatened which
might cause any such change at any time in the future.
K. Absence of Material Adverse Change; Conduct of Business. Except
as described in any of the Company's SEC Filings, since March 31,
1996 (a) there has not been any change in the financial
condition, properties, business, results of operations or
prospects (financial or otherwise) of the Company and its
subsidiaries taken as a whole which has affected or may
reasonably be expected to materially and adversely affect the
business or financial condition of the Company and its
subsidiaries taken as a whole; and (b) the Company and each of
its subsidiaries have conducted its businesses only in, and has
not taken any action other than in, the ordinary course of
business.
L. Litigation; Investigation. Except as described in the Company's
SEC Filings or otherwise disclosed herein: (a) no notice has been
received that a material investigation or review by any
governmental entity with respect to the Company or any of its
subsidiaries is pending nor is any such investigation or review
threatened, nor has any governmental entity indicated to the
Company or any of its subsidiaries an intention to conduct the
same; and (b) there is no action, suit, arbitration or claim or
proceeding pending or, threatened against or affecting the
Company or any of its subsidiaries at law or in equity, or before
any federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality which either
singularly or in the aggregate would, if adversely determined,
result in any material adverse change in the financial condition,
properties, business, result of operations or prospects
(financial or otherwise) of the Company and its subsidiaries
taken as a whole; and (c) no suit, action, proceeding or
investigation is pending or threatened before any court or
governmental agency to restrain or prohibit, or to obtain
damages, a discovery order or other release in connection with
this Agreement or the consummation of the transactions
contemplated hereby.
M. Income Taxes; Other Taxes. The Company and each of its
subsidiaries has filed all Federal, state, county and local
income and franchise taxes, sales taxes, use taxes, gross
receipts taxes or employment, payroll and withholding taxes and
all of the tax returns, reports and declarations which are or
have been required to be filed by it and has paid or made
provisions for the payment of, all such taxes which were due
pursuant to said returns or pursuant to any assessments received
by it except with respect to any such returns, taxes, or
assessments as to which the failure to file or make payment would
not have a material adverse affect on the business or assets of
the Company and its subsidiaries taken as a whole. The Company
files a consolidated income tax return with all of its
subsidiaries. The Federal income tax returns of the Company and
its subsidiaries have not been subject to any audits. Neither the
Company nor any of its subsidiaries is a party to any pending
action or proceeding by any governmental authority, for
assessment or collection of taxes,
<PAGE>
except for such taxes, penalties and interests which in the
aggregate are not material in amount. Neither the Company nor any
of its subsidiaries know of any basis for a deficiency assessment
in any Federal, state, county or local income taxes or franchise
taxes, sales taxes, use taxes, gross receipt taxes of employment,
payroll and withholding taxes against it, except for such taxes,
penalties and interests which in the aggregate are not material
in amount.
N. Compliance with Applicable Law. The operation of the Company and
its subsidiaries substantially complies with all applicable laws,
ordinances, regulations, decrees and orders of any court or
governmental entity ("Rules"), except in respect to such Rules as
to which failure to comply would not materially and adversely
affect the financial condition, properties, business, results of
operations or prospects (financial or otherwise) of the Company
and its subsidiaries taken as a whole.
O. No Default. Neither the Company nor any of its subsidiaries is in
default or violation in any respect of any term, condition or
provision of any of the following, the violation or default of
which would have a material adverse effect on the financial
condition, properties, business, results of operations, or
prospects (financial or otherwise) of the Company and its
subsidiaries taken as a whole:
1. The Certificate of Incorporation or By-laws of the Company;
2. any mortgage, indenture, contract, agreement, lease or other
instrument to which the Company or any of its subsidiaries
is now a party or by which it or any of its respective
properties or assets may be bound;
3. any agreement pursuant to which the Company has borrowed or
has the right to borrow monies; or
4. any judgment, decree or order applicable to the Company or
any of its subsidiaries.
P. Disclosure. Neither any of the information contained herein and
the documents specifically referred to herein furnished or to be
furnished to the Company and any other documents or material
furnished or made available to the Company contains or will
contain any untrue statement of a material fact or omits or will
omit to state a material fact required to be stated therein or
herein or necessary in order to make the statements therein or
herein, in light of the circumstances under which they shall have
been made, not misleading.
IV. Representations and Warranties of the Investor. The
Investor represents and warrants to the Company as follows:
A. The Investor will execute and deliver a Subscription Agreement in
the form attached hereto as Exhibit B, and hereby makes the
representations and warranties set forth therein.
B. The Investor has the requisite capacity and authority for the
execution, delivery and performance of this Agreement. This
Agreement constitutes a valid and binding obligation of each
Investor enforceable in accordance with its terms,
<PAGE>
subject as to enforcement of remedies to applicable bankruptcy,
insolvency, reorganization or similar laws relating to or
affecting the enforcement of creditors' rights.
C. The Investor acknowledges that the Company is a public company.
The Investor confirms that it has reviewed the periodic filings
of the Company with the SEC, had an opportunity to ask questions
of officials of the Company concerning the business of the
Company, and otherwise had full opportunity to obtain such
information as it deems necessary to making its decision to
purchase the Shares and Warrants upon the terms and conditions
set forth in this Agreement.
D. The Shares are not being purchased for resale, resyndication,
distribution, subdivision or fractionalization thereof nor are
the Shares being purchased with a view to or for sale in
connection with any distribution within the meaning of the
Securities Act of 1933, as amended
V. Company Covenants. The Company hereby covenants with the Investor
as follows:
A. The Company shall immediately commence the preparation and filing
of a registration statement registering the Shares and the Shares
underlying the Warrants for sale with the SEC. The Company shall
diligently prosecute the registration and shall register the
Shares no later than ninety (90) days after the closing, and
shall take any and all actions necessary to maintain the
effectiveness of the registration, including filing
post-effective amendments, if necessary, until each Investor
shall have disposed of its Shares (and the Shares underlying the
Warrants). Failure to complete the registration of the Shares and
the Shares underlying the Warranties within such ninety (90) day
period shall be and be deemed to be a material breach of this
Agreement.
B. The Company will use its best efforts to have its largest
shareholder, Raymond L. Bauch, agree that, for a period of two
(2) years following the closing, he will sell no more than one
percent (1%) of the outstanding stock of the Company in any
calendar quarter; provided, that Mr. Bauch shall be entitled to
participate as a selling shareholder if and to the extent, that
the purchase is a selling shareholder in a secondary public
offering of the Company's shares.
C. The Company agrees that it will pay a finder fee to Mr. Todd
McMahon of McMahon & Associates upon successful completion of the
transaction outlined herein, as negotiated between Mr. McMahon
and the Company. The parties hereto mutually represent and
warrant each to the other that no other broker or finder was
involved in arranging this transaction or has the right to
receive a commission or fee in connection herewith.
D. So long as the Warrants are outstanding, the Company shall not
issue any additional Shares or securities convertible into Shares
(with the exception of Shares issuable upon exercise of options
issued under the Company's existing stock option plans) without
the consent of the Purchaser. This restriction shall not apply,
however, if the average closing price of the Company' common
stock for the five days preceding the proposed issuance exceeds
$5.00.
<PAGE>
E. Purchaser shall have the right of first refusal to provide debt
financing which the Company may require.
VI. Further Assurances. From time to time after the Closing, the Company
shall promptly execute and deliver to each Investor such further
agreements, assurances or other instruments of transfer as the
Investor may reasonably request in order to vest and confirm ownership
of the Shares in the Buyer and to effectuate the purposes, terms and
conditions of this Agreement.
VII. Indemnification. The Company shall indemnify and hold each Investor
harmless from and against any loss, damage or expense which may result
from (i) the inaccuracy or falsity of any representation or warranty
of Company hereunder, or (ii) the failure of Company to fulfill its
covenants hereunder.
VIII. Miscellaneous.
A. Amendments. Neither this Agreement nor any provisions hereof may
be changed, waived, discharged or terminated orally, but only by
a signed statement in writing.
B. Governing Laws. This Agreement shall be governed in all respects
by the laws of the State of New York.
C. Survival. The representations, warranties, covenants and
agreements made herein shall survive the Closing of the
transactions contemplated hereby.
D. Successors and Assigns. No party may assign this Agreement
without the express written consent of the other. Except as
otherwise expressly provided herein, the provisions hereof shall
inure to the benefit of, and be binding upon, the successors,
assigns, heirs, executors and administrators of the parties
hereto.
E. Entire Agreement. This Agreement and the other documents
delivered pursuant hereto constitute the full and entire
understanding and agreement between the parties with regard to
the subjects hereof and thereof.
F. Execution. Each party hereto may evidence its execution and
delivery hereof by facsimile delivery of an original signature
page at or prior to closing, which facsimile shall be deemed to
be an original for all purposes. This Agreement may be executed
in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one in the
same instrument.
IN WITNESS WHEREOF, this Agreement has been executed as of the date
first written above.
SPATIALIGHT, INC.
By:
_____________________
William E. Hollis
President
________________________
By:
__________________________
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned hereunto
duly authorized.
Spatialight, Inc.
---------------------------------------
(Registrant)
/s/ William E. Hollis
---------------------------------------
Date: July 17, 1996 William E. Hollis, President
