SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
Date of Report (Date of earliest event reported) July 1 1999
U.S. Wireless Data, Inc.
----------------------------------------------------
(Exact name of registrant as specified in its charter)
Colorado 0-22848 84-1178691
---------------- ----------- ------------------
(State or other (Commission (I.R.S. Employer
jurisdiction File Number) Identification No.)
of incorporation)
2200 Powell Street, Suite 800, Emeryville, California 94608
-----------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (510) 596-2025
------------------------------------------------------------
(Former name or former address, if changed since last report.)
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On July 7, 1999 U.S. Wireless Data, Inc. (USWD) closed on the sale of a merchant
credit card portfolio to PMT Services Inc., a wholly owned subsidiary of Nova
Corporation. The transaction resulted in a cash payment to USWD of $450,000 and
was based on a forward-looking analysis of the portfolio's cash flow. In January
1997, USWD signed a Member Service Provider (MSP) agreement with Nova whereby
USWD enrolled merchants to process credit card transactions with Nova. The
Company was compensated for its services by retaining a portion of the credit
card revenue stream. In the second quarter of fiscal year 1999, USWD changed its
focus from building direct credit card portfolios via the acquisition of
merchant accounts, to providing services directly to the merchant acquirers and
card processors. USWD intends to provide these services to Nova under its
Wireless Express Payment ServiceSM for the merchant base Nova acquired in this
transaction, although an agreement to do so has not yet been signed.
The sale included approximately 450 installed USWD owned TRANZ Enabler
point-of-sale devices deployed with a portion of the respective merchants. The
net book value of these assets will be charged against the proceeds of the
transaction, which will be recorded in the Company's fiscal quarter ending
September 30, 1999.
Item 5. Other Events.
On July 1, 1999 USWD entered into an agreement with Liviakis Financial
Communications, Inc. (LFC), a California based investor relations and consulting
firm, to provide the Company with public relations and investor relations
services through March 15, 2000. The Company will issue 690,000 shares of Common
Stock to LFC for its services under this agreement. LFC has provided these
services to USWD under past agreements and has also provided financing to the
Company. LFC is affiliated with the Company through its ownership of the
Company's stock and the stock ownership of Mr. John Liviakis, an officer and
principal owner of LFC. Together, Mr. Liviakis and LFC hold approximately 37% of
the Company's outstanding Common Stock.
Item 7. Financial Statements and Exhibits.
The following Exhibits are filed as part of this report:
Exhibit
Number Description of Exhibit
- ------- ----------------------
10.1* Purchase Agreement, dated as of June 30, 1999 and closed on July
7, 1999, between U.S. Wireless Data, Inc. and PMT Services Inc.,
a wholly owned subsidiary of Nova Corporation.
10.2 Consulting Agreement, effective as of July 1, 1999, between U.S.
Wireless Data, Inc. and Liviakis Financial Communications, Inc.
- -------------
* To be filed by amendment.
-2-
<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.
U.S. Wireless Data, Inc.
-----------------------------------------
(Registrant)
July 22, 1999 By /s/ Robert E. Robichaud
- --------------- --------------------------------------
(Date) (Signature)
Robert E. Robichaud
Chief Financial Officer
-3-
CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement"), effective as of July 1, 1999 is
entered into by and between U.S. WIRELESS DATA INC., a Colorado corporation
(herein referred to as the "Company") and LIVIAKIS FINANCIAL COMMUNICATIONS,
INC., a California corporation (herein referred to as the "Consultant").
RECITALS
WHEREAS, Company is a publicly held corporation with its common stock
traded through the OTC Bulletin Board; and
WHEREAS, Consultant has experience in the area of investor communications
and financial and investor public relations; and
WHEREAS, Company desires to engage the services of Consultant to assist and
consult with the Company in matters concerning investor relations and to
represent the company in investors' communications and public relations with
existing shareholders, brokers, dealers and other investment professionals as to
the Company's current and proposed activities;
NOW THEREFORE, in consideration of the promises and the mutual covenants
and agreements hereinafter set forth, the parties hereto covenant and agree as
follows:
1. Term of Consultancy. Company hereby agrees to retain the Consultant to act in
a consulting capacity to the Company, and the Consultant hereby agrees to
provide services to the Company commencing July 1, 1999 and ending on March 15,
2000.
2. Duties of Consultant. The Consultant agrees that it will generally provide
the following specified consulting services through its officers and employees
during the term specified in Section 1.:
(a) Advise and assist the Company in developing and implementing
appropriate plans and materials for presenting the Company and its business
plans, strategy and personnel to the financial community, establishing an image
for the Company in the financial community, and creating the foundation for
subsequent financial public relations efforts;
(b) Introduce the Company to the financial community;
(c) With the cooperation of the Company, maintain an awareness during the
term of this Agreement of the Company's plans, strategy and personnel, as they
may evolve during such period, and advise and assist the Company in
communicating appropriate information regarding such plans, strategy and
personnel to the financial community;
(d) Assist and advise the Company with respect to its (i) stockholder and
investor relations, (ii) relations with brokers, dealers, analysts and other
investment professionals, and (iii) financial public relations generally;
1
<PAGE>
(e) Perform the functions generally assigned to investor/stockholder
relations and public relations departments in major corporations, including
responding to telephone and written inquiries (which may be referred to the
Consultant by the Company); preparing press releases for the Company with the
Company's involvement and approval or reviewing press releases, reports and
other communications with or to shareholders, the investment community and the
general public; advising with respect to the timing, form, distribution and
other matters related to such releases, reports and communications; and
consulting with respect to corporate symbols, logos, names, the presentation of
such symbols, logos and names, and other matters relating to corporate image;
(f) Upon the Company's approval, disseminate information regarding the
Company to shareholders, brokers, dealers, other investment community
professionals and the general investing public;
(g) Upon the Company's approval, conduct meetings, in person or by
telephone, with brokers, dealers, analysts and other investment professionals to
advise them of the Company's plans, goals and activities, and assist the Company
in preparing for press conferences and other forums involving the media,
investment professionals and the general investment public;
(h) At the Company's request, review business plans, strategies, mission
statements budgets, proposed transactions and other plans for the purpose of
advising the Company of the investment community implications thereof; and,
(i) Otherwise perform as the Company's financial relations and public
relations consultant.
3. Allocation of Time and Energies. The Consultant hereby promises to
perform and discharge well and faithfully the responsibilities which may be
assigned to the Consultant from time to time by the officers and duly authorized
representatives of the Company in connection with the conduct of its financial
and investor public relations and communications activities, so long as such
activities are in compliance with applicable securities laws and regulations.
Consultant shall diligently and thoroughly provide the consulting services
required hereunder. Although no specific hours-per-day requirement will be
required, Consultant and the Company agree that Consultant will perform the
duties set forth herein above in a diligent and professional manner. The parties
acknowledge and agree that a disproportionately large amount of the effort to be
expended and the costs to be incurred by the Consultant and the benefits to be
received by the Company are expected to occur upon and shortly after, and in any
event, within two months of the effectiveness of this Agreement. It is
explicitly understood that Consultant's performance of its duties hereunder will
in no way be measured by the price of the Company's common stock, nor the
trading volume of the Company's common stock. It is also understood that the
Company is entering into this Agreement with Liviakis Financial Communications,
Inc. ("LFC"), a corporation and not any individual member of LFC, and with such,
Consultant will not be deemed to have breached this Agreement if any member,
officer or director of LFC leaves the firm or dies or becomes physically unable
to perform any meaningful activities during the term of the Agreement, provided
the Consultant otherwise performs its obligations under this Agreement. The
Company shall have the right to request that any of Consultant's employees or
2
<PAGE>
outside independent contractors, if any, not perform any services for the
Company contemplated hereunder on behalf Consultant.
4. Remuneration. As full and complete compensation for services described in
this Agreement, the Company shall compensate LFC (herein referred to as
"Consultants") as follows:
4.1 For undertaking this engagement and for other good and valuable
consideration, the Company agrees to issue and deliver to the
Consultants a "Commencement Bonus" payable in the form of 690,000 shares
of the Company's Common Stock ("Common Stock"). This Commencement Bonus
shall be issued to the Consultants immediately following execution of
this Agreement and shall, when issued and delivered to Consultants, be
fully paid and nonassessable. The Company understands and agrees that
Consultants has foregone significant opportunities to accept this
engagement and that the Company derives substantial benefit from the
execution of this Agreement and the ability to announce its relationship
with Consultants. The 690,000 shares of Common Stock issued as a
Commencement Bonus, therefore, constitute payment for Consultants'
agreement to represent the Company and are a nonrefundable,
non-apportionable, and non-ratable retainer; such shares of Common Stock
are not a prepayment for future services. If the Company decides to
terminate this Agreement prior to March 15, 2000 for any reason
whatsoever, it is agreed and understood that Consultants will not be
requested or demanded by the Company to return any of the shares of
Common Stock paid to it hereunder, however if the Consultant terminates
the Agreement prior to March 15, 2000, the Consultant agrees to prorate
the amount of shares for its services. The 690,000 shares of Common
Stock issued pursuant to this Agreement shall be issued in the name of
Liviakis Financial Communications, Inc. The Company agrees that all
shares issuable to Consultants hereunder shall carry "piggyback
registration rights" whereby such shares will be included in the next
appropriate registration statement filed by the Company.
4.2 Consultants acknowledge that the shares of Common Stock to be issued
pursuant to this Agreement (collectively, the "Shares") have not been
registered under the Securities Act of 1933, and accordingly are
"restricted securities" within the meaning of Rule 144 of the Act. As
such, the Shares may not be resold or transferred unless the Company has
received an opinion of counsel reasonably satisfactory to the Company
that such resale or transfer is exempt from the registration
requirements of that Act. In addition, Consultant agrees that, during
the term hereof neither it, nor its officers or affiliates shall
directly or indirectly, acquire or dispose of any securities of Company
without the Company's written consent. Further, the Consultant agrees to
a "lock-up" period where it will not sell any shares while engaged by
the Company.
4.3 In connection with the acquisition of Shares hereunder, the Consultants
represent and warrant to the Company as follows:
(a) Consultants acknowledge that the Consultants have been afforded the
opportunity to ask questions of and receive answers from duly
authorized officers or other representatives of the Company concerning
an investment in the Shares, and any additional information which the
Consultants have requested.
3
<PAGE>
(b) Consultants' investment in restricted securities is reasonable in
relation to the Consultants' net worth, which is in excess of ten (10)
times the Consultants' cost basis in the Shares. Consultants have had
experience in investments in restricted and publicly traded
securities, and Consultants have had experience in investments in
speculative securities and other investments which involve the risk of
loss of investment. Consultants acknowledges that an investment in the
Shares is speculative and involves the risk of loss. Consultants have
the requisite knowledge to assess the relative merits and risks of
this investment without the necessity of relying upon other advisors,
and Consultants can afford the risk of loss of his entire investment
in the Shares. Consultants are (i) accredited investors, as that term
is defined in Regulation D promulgated under the Securities Act of
1933, and (ii) a purchaser described in Section 25102 (f) (2) of the
California Corporate Securities Law of 1968, as amended.
(c) Consultants are acquiring the Shares for the Consultants' own
account for long-term investment and not with a view toward resale or
distribution thereof except in accordance with applicable securities
laws.
5. Financing "Finder's Fee". It is understood that in the event Consultant
introduces Company, or its nominees, to a lender or equity purchaser, not
already having a preexisting relationship with the Company, with whom Company,
or its nominees, ultimately finances or causes the completion of such financing,
Company agrees to compensate Consultant for such services with a "finder's fee"
in the amount of 2.5% of total gross funding provided by such lender or equity
purchaser, such fee to be payable in cash. This will be in addition to any fees
payable by Company to any other intermediary, if any, which shall be per
separate agreements negotiated between Company and such other intermediary. It
is also understood that in the event Consultant introduces Company, or its
nominees, to an acquisition candidate, either directly or indirectly through
another intermediary, not already having a preexisting relationship with the
Company, with whom Company, or its nominees, ultimately acquires or causes the
completion of such acquisition, Company agrees to compensate Consultant for such
services with a "finder's fee" in the amount of 2% of total gross consideration
provided by such acquisition, such fee to be payable in cash. This will be in
addition to any fees payable by Company to any other intermediary, if any, which
shall be per separate agreements negotiated between Company and such other
intermediary. It is specifically understood that Consultant is not nor does it
hold itself out be a Broker/Dealer, but is rather merely a "Finder" in reference
to the Company procuring financing sources and acquisition candidates.
5.1 It is further understood that Company, and not Consultant, is
responsible to perform any and all due diligence on such lender, equity
purchaser or acquisition candidate introduced to it by Consultant under
this Agreement, prior to Company receiving funds or closing on any
acquisition.
5.2 Company agrees that said compensation to Consultant shall be paid in
full at the time said financing or acquisition is closed. Moreover, said
compensation, will be a condition precedent to the closing of such
financing or acquisition and Company shall execute any and all documents
necessary to effect said compensation.
4
<PAGE>
5.3 As further consideration to Consultant, Company, or its nominees, agrees
to pay with respect to any financing or acquisition candidate provided
directly or indirectly to the Company by any lender or equity purchaser
covered by this Section 5. during the period of one year from the date
of this Agreement, a fee to Consultant equal to that outlined in Section
"5" herein.
5.4 Consultant will notify Company of introductions it makes for potential
sources of financing or acquisitions in a timely manner (within
approximately 3 days of introduction) via facsimile memo. If Company has
a preexisting relationship with such nominee and believes such party
should be excluded from this Agreement, then Company will notify
Consultant immediately of such circumstance via facsimile memo.
6. Expenses. Consultant agrees to pay for all its expenses (phone, mailing,
labor, etc.), other than extraordinary items (travel required by/or specifically
requested by the Company, luncheons or dinners to large groups of investment
professionals, mass faxing to a sizable percentage of the Company's
constituents, investor conference calls, print advertisements in publications,
etc.) approved by the Company prior to its incurring an obligation for
reimbursement.
7. Indemnification. The Company warrants and represents that all oral
communications, written documents or materials furnished to Consultant by the
Company with respect to financial affairs, operations, profitability and
strategic planning of the Company are accurate and Consultant may rely upon the
accuracy thereof without independent investigation. The Company will protect,
indemnify and hold harmless Consultant against any claims or litigation
including any damages, liability, cost and reasonable attorney's fees as
incurred with respect thereto resulting from Consultant's communication or
dissemination of any said information, documents or materials not designated by
the Company to the Consultant as "confidential" or "Company private", excluding
any such claims or litigation resulting from Consultant's communication or
dissemination of information not provided or authorized by the Company.
8. Representations. Consultant represents that it is not required to maintain
any licenses and registrations under federal or any state regulations necessary
to perform the services set forth herein. Consultant acknowledges that, to the
best of its knowledge, the performance of the services set forth under this
Agreement will not violate any rule or provision of any regulatory agency having
jurisdiction over Consultant. Consultant acknowledges that, to the best of its
knowledge, Consultant and its officers and directors are not the subject of any
investigation, claim, decree or judgment involving any violation of the SEC or
securities laws. Consultant further acknowledges that it is not a securities
Broker Dealer or a registered investment advisor. Company acknowledges that, to
the best of its knowledge, that it has not violated any rule or provision of any
regulatory agency having jurisdiction over the Company. Company acknowledges
that, to the best of its knowledge, Company is not the subject of any
investigation, claim, decree or judgment involving any violation of the SEC or
securities laws.
9. Legal Representation. The Company acknowledges that it has been represented
by independent legal counsel in the preparation of this Agreement. Consultant
represents that they have consulted with independent legal counsel and/or tax,
financial and business advisors, to the extent the Consultant deemed necessary.
5
<PAGE>
10. Status as Independent Contractor. Consultant's engagement pursuant to this
Agreement shall be as independent contractor, and not as an employee, officer or
other agent of the Company. Neither party to this Agreement shall represent or
hold itself out to be the employer or employee of the other. Consultant further
acknowledges the consideration provided herein above is a gross amount of
consideration and that the Company will not withhold from such consideration any
amounts as to income taxes, social security payments or any other payroll taxes.
All such income taxes and other such payment shall be made or provided for by
Consultant and the Company shall have no responsibility or duties regarding such
matters. Neither the Company or the Consultant possess the authority to bind
each other in any agreements without the express written consent of the entity
to be bound.
11. Attorney's Fee. If any legal action or any arbitration or other proceeding
is brought for the enforcement or interpretation of this Agreement, or because
of an alleged dispute, breach, default or misrepresentation in connection with
or related to this Agreement, the successful or prevailing party shall be
entitled to recover reasonable attorneys' fees and other costs in connection
with that action or proceeding, in addition to any other relief to which it or
they may be entitled.
12. Waiver. The waiver by either party of a breach of any provision of this
Agreement by the other party shall not operate or be construed as a waiver of
any subsequent breach by such other party.
13. Notices. All notices, requests, and other communications hereunder shall be
deemed to be duly given if sent by U.S. mail, postage prepaid, addressed to the
other party at the address as set forth herein below:
To the Company: U.S. Wireless Data, Inc.
Dean Leavitt, Chairman and CEO
2200 Powell Street, Suite 450
Emeryville, CA 94608
To the Consultant: Liviakis Financial Communications, Inc.
John M. Liviakis, President
2420 "K" Street, Suite 220;
Sacramento, CA 95816.
It is understood that either party may change the address to which notices
for it shall be addressed by providing notice of such change to the other party
in the manner set forth in this paragraph.
6
<PAGE>
14. Choice of Law, Jurisdiction and Venue. This Agreement shall be governed by,
construed and enforced in accordance with the laws of the State of California.
The parties agree that Alameda County, CA. will be the venue of any dispute and
will have jurisdiction over all parties.
15. Arbitration. Any controversy or claim arising out of or relating to this
Agreement, or the alleged breach thereof, or relating to Consultant's activities
or remuneration under this Agreement, shall be settled by binding arbitration in
California, in accordance with the applicable rules of the American Arbitration
Association, and judgment on the award rendered by the arbitrator(s) shall be
binding on the parties and may be entered in any court having jurisdiction
thereof. The provisions of Title 9 of Part 3 of the California Code of Civil
Procedure, including section 1283.05, and successor statutes, permitting
expanded discovery proceedings shall be applicable to all disputes that are
arbitrated under this paragraph.
16. Complete Agreement. This Agreement contains the entire agreement of the
parties relating to the subject matter hereof. This Agreement and its terms may
not be changed orally but only by an agreement in writing signed by the party
against whom enforcement of any waiver, change, modification, extension or
discharge is sought.
AGREED TO:
"Company" U.S. WIRELESS DATA, INC.
Date: 7/1/99 By: /s/ Dean Leavitt
------------ ------------------------------------
Dean Leavitt
Chairman and CEO
"Consultant" LIVIAKIS FINANCIAL COMMUNICATIONS, INC.
Date: 7/1/99 By: /s/ John M. Liviakis
------------ ------------------------------------
John M. Liviakis
President
7
