UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. __)*
NetLive Communications, Inc.
-----------------------------------------
(Name of Issuer)
Common Stock
-----------------------------------------
(Title of Class of Securities)
64114210
-----------------------------------------
(CUSIP Number)
Mr. Owen May With a copy to:
May Davis Group, Inc. Morris Orens, Esq.
Wall Street Tower Shereff, Friedman, Hoffman & Goodman, LLP
20 Exchange Place 919 Third Avenue
New York, New York 10005 New York, New York 10022
(212) 480-2710 (212) 758-9500
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
February 28, 1997
-----------------------------------------
(Date of Event which Requires Filing of
this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
statement because of Rule 13d-1(b) (3) or (4), check the following: [ ].
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
SCHEDULE 13D
- --------------------------------------------------------------------------------
CUSIP No. 64114210 Page 2 of ___ Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
May Davis Group, Inc. (13-373-5598)
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or 2(e) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 11,600
BENEFICIALLY ------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 0
REPORTING ------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 11,600
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,600
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.4%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO; BD
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
- --------------------------------------------------------------------------------
CUSIP No. 64114210 Page 3 of ___ Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Owen May
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
Not applicable.
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or 2(e) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY ------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 11,600
REPORTING ------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 0
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
11,600
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,600
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.4%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
- --------------------------------------------------------------------------------
CUSIP No. 64114210 Page 4 of ___ Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Dibo Attar
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
Not applicable.
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or 2(e) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Italy
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY ------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 555,000
REPORTING ------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 0
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
555,000
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
555,000
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.6%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
- --------------------------------------------------------------------------------
CUSIP No. 64114210 Page 5 of ___ Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Dennis Sal
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or 2(e) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 90,000
BENEFICIALLY ------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 0
REPORTING ------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 90,000
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
90,000
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.4%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
ITEM 1. SECURITY AND ISSUER.
The class of equity security to which this Statement on Schedule 13D (this
"Schedule 13D") relates is the common stock, par value $.0001 per share (the
"Common Stock") of NetLive Communications, Inc., a Delaware corporation (the
"Company"), with its principal executive offices located at 584 Broadway, New
York, New York 10012.
ITEM 2. IDENTITY AND BACKGROUND.
(a) This Statement is being filed by May Davis Group, Inc., a Delaware
corporation ("May Davis"); Owen May; Dibo Attar; and Dennis Sal (individually, a
"Reporting Person" and collectively, the "Reporting Persons"), who collectively
may be deemed a group beneficially owning more than 5% of the outstanding shares
of the Common Stock within the meaning of Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended (the "Act"). The filing of this Schedule 13D
shall not be construed as an admission that any Reporting Person is, for
purposes of Section 13(d) or 13(g) of the Act, the beneficial owner of any
securities covered by this Schedule 13D except for the securities stated herein
to be beneficially owned by such Reporting Person.
(b) (c) May Davis is a privately held corporation which is principally
engaged in the investment banking and brokerage business. Mr. May is Chairman
and Chief Executive Officer of May Davis and a member of the Board of Directors
of May Davis. Information regarding the directors and executive officers of May
Davis is attached hereto as Annex 1 which annex is incorporated herein by
reference. The principal business address and principal office address of May
Davis and the business address of Mr. May is Wall Street Tower, 20 Exchange
Place, New York, New York 10005. Mr. Attar's principal occupation is a private
investor. The principal business address of Mr. Attar is 4900 Woodway, Suite
650, Houston, Texas 77056. Mr. Sal's principal occupation is President and Chief
Executive Officer of DRG Services, Inc., a management consulting/computer
services entity. The principal business address of DRG Services, Inc. and Mr.
Sal is 15700 West Ten Mile, Suite 112, Southfield, Michigan 48075.
(d) (e) During the last five years, none of the Reporting Persons, and to
the best knowledge of each of the Reporting Persons, none of the persons listed
on Annex 1 attached hereto, (1) has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors), or (2) was a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction
and as a result of such proceeding was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, Federal or State securities laws or finding any violation
with respect to such laws.
(f) Each of Messrs. May and Sal is a citizen of the United States of
America and, to the best knowledge of each of the Reporting Persons, each of the
persons listed on Annex 1 attached hereto is a citizen of the United States of
America. Mr. Attar is a citizen of Italy.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The shares of Common Stock owned by the Reporting Persons were acquired at
an aggregate cost of $497,412.
The 11,600 shares of Common Stock beneficially owned by May Davis were
purchased for its trading account (which has been active since the Company's
initial public offering in August 1996) with general working capital of May
Davis for an aggregate purchase price of $84,912.
Of the 90,000 shares of Common Stock beneficially owned by Mr. Sal, 50,000
of such shares were acquired in a private placement by the Company in March 1996
in which Mr. Sal was issued a $100,000 bridge note, certain warrants to purchase
shares of Common Stock (which warrants were subsequently sold by Mr. Sal) and
such 50,000 shares of Common Stock in consideration of Mr. Sal's $100,000
investment, the source of which was his personal funds. The bridge note has been
fully paid by the Company. In a private placement by the Company in April 1996,
Mr. Sal purchased an additional 40,000 shares of Common Stock for $100,000, the
source of which was Mr. Sal's personal funds.
None of the persons listed in Annex 1 attached hereto has contributed any
funds or other consideration towards the acquisition of the Common Stock by any
of the Reporting Persons.
<PAGE>
ITEM 4. PURPOSE OF TRANSACTION.
The Reporting Persons initially acquired the Common Stock owned by them for
investment purposes. Presently, the Reporting Persons also hold the Common Stock
in order to commence and support a consent solicitation with respect to the
removal of the present members of the Board of Directors from their positions as
directors of the Company and any other person or persons elected or designated
by any such directors to fill any vacancy or newly created directorship; and to
replace such directors with nominees to be selected by the Reporting Persons.
Subject to applicable legal requirements and the factors referred to below,
the Reporting Persons may, from time to time, purchase additional shares of
Common Stock in open market or privately negotiated transactions. In determining
whether to purchase additional shares, the Reporting Persons intend to consider
and review various factors on a continuous basis, including the Company's
financial condition, business and prospects, other developments concerning the
Company, the reaction of the Company and of stockholders to the Reporting
Persons' ownership of Common Stock and/or the commencement of a consent
solicitation as described herein, the price and availability of shares of Common
Stock, other investment and business opportunities available to each of the
Reporting Persons, developments with respect to the Reporting Person's
businesses, and general economic, money and stock market conditions. In
addition, depending upon, among other things, the matters referred to above, the
Reporting Persons may determine at any time to dispose of all or a portion of
their shares of Common Stock. Except as described in Item 6, each of the
Reporting Persons reserves the right to change its plans and intentions at any
time, as it deems appropriate, and, to the knowledge of each of the Reporting
Persons, each of the persons listed on Annex 1 attached hereto may make the same
evaluation and may have the same reservation.
Except as set forth in this Item 4, none of the Reporting Persons or, to
the knowledge of each of the Reporting Persons, any of the persons listed on
Annex 1 hereto, has any present plans or intentions which would result in or
relate to any of the transactions described in subparagraphs (a) through (j) of
Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) The Reporting Persons, in the aggregate, beneficially own 656,600
shares of Common Stock, or approximately 20.8% of the shares of the Common Stock
outstanding (which for purposes of this calculation includes 500,000 shares
subject to currently exercisable warrants). All percentages of shares of Common
Stock beneficially owned by the Reporting Persons are based on the 2,650,000
shares of Common Stock outstanding as of February 14, 1997, as disclosed in the
Company's Quarterly Report on Form 10-Q for the quarterly period ended December
31, 1996.
May Davis beneficially owns, directly, 11,600 shares of Common Stock, or
0.4% of the outstanding Common Stock. May Davis is the record holder of certain
shares of Common Stock beneficially owned by brokerage customers of May Davis,
and such shares have been excluded from the number of shares reported herein as
beneficially owned by May Davis. May Davis may direct the vote of such
securities, without instruction, on other than contested matters or matters that
may affect substantially the rights or privileges of the holders of the
securities to be voted, but is otherwise precluded from voting such shares
without instruction.
Owen May, who is the Chairman and Chief Executive Officer, and a director,
of May Davis is the beneficial owner of approximately 37% of May Davis's
outstanding common stock, and thus may be deemed to control May Davis.
Accordingly, Mr. May may be deemed the beneficial owner of the 11,600 shares of
Common Stock owned by May Davis. The disclosure of this information shall not be
construed as an admission that Mr. May is the beneficial owner of any of the
Common Stock owned by May Davis either for purposes of Section 13(d) of the Act
or for any other purpose, and such beneficial ownership is expressly disclaimed.
Mr. Attar beneficially owns, directly, no shares of Common Stock. Mr. Attar
is an adviser to seven investment funds (the "Funds") which beneficially own,
directly, an aggregate of 213,600 shares or 8.1% of the outstanding Common
Stock. The Funds also beneficially own, directly, warrants to purchase 1,000,000
shares of Common Stock. Such Warrants are currently exercisable at $5.50 per
share. Each of four such Funds which beneficially own in the aggregate 55,000
shares or 2.1% of the outstanding Common Stock, and warrants to purchase 500,000
shares or 15.9% of the outstanding Common Stock (which for purposes of this
calculation includes 500,000 shares subject to currently exercisable warrants),
have granted to an employee of Woodco Fund Management, Inc. ("Woodco"), a
corporation which Mr. Attar controls, the power of attorney to act as its agent
and attorney in fact without restriction. Accordingly, Mr. Attar may be deemed
to be the beneficial owner of the 555,000
<PAGE>
shares or 17.6% of the outstanding Common Stock (which for purposes of this
calculation includes 500,000 shares subject to currently exercisable warrants)
beneficially owned by such Funds. Mr. Attar expressly disclaims beneficial
ownership of such shares of Common Stock. Mr. Attar has no power, sole or
shared, to vote or dispose of the 158,600 shares and warrants to purchase
500,000 shares of Common Stock held by the remaining three Funds; however, it is
expected that these Funds will vote in the consent solicitation, if such consent
solicitation is commenced, in accordance with Mr. Attar's advice.
Mr. Sal beneficially owns, directly, 90,000 shares or 3.4% of the
outstanding Common Stock. In addition, Mr. Sal has personal (not family)
relationships with certain individuals who beneficially own, directly, 40,000
shares or 1.5% of Common Stock. It is expected that these individuals will vote
such shares in the consent solicitation, if such consent solicitation is
commenced, in accordance with Mr. Sal's advice.
Except as described in this subparagraph (a), neither any of the Reporting
Persons nor, to the best knowledge of the Reporting Persons, any of the persons
referred to in Annex 1 attached hereto, beneficially owns any shares of Common
Stock.
(b) May Davis has sole power to vote or to direct the voting and to dispose
or direct the disposition of the 11,600 shares of Common Stock which it owns.
Mr. May may be deemed to have the shared power, to vote or to direct the voting
and to dispose or to direct the disposition of the 11,600 shares of Common Stock
owned by May Davis. Mr. May expressly disclaims beneficial ownership of such
shares of Common Stock. Mr Attar may be deemed to have the shared power to vote
or to direct the voting and to dispose or to direct the disposition of the
555,000 shares of Common Stock beneficially owned by certain Funds which have
granted a power of attorney to a Woodco employee as described above. Mr. Attar
expressly disclaims beneficial ownership of such shares of Common Stock. Mr.
Attar has no power, sole or shared, to vote or to direct the voting and to
dispose or to direct the disposition of the 658,000 shares of Common Stock
beneficially owned by the remaining Funds. Mr. Sal has sole power to vote or to
direct the voting and to dispose or to direct the disposition of the 90,000
shares of Common Stock which he owns. Mr. Sal has no power, sole or shared, to
vote or to direct the voting and to dispose or to direct the disposition of the
40,000 shares of Common Stock owned by certain individuals with whom he has a
personal relationship.
(c) Transactions in the Common Stock by any of the Reporting Persons, and
to the best knowledge of the Reporting Persons, any of the persons referred to
in Annex 1 attached hereto, effected during the past 60 days are described in
Annex 2 hereto and are incorporated herein by reference. All such transactions
were effected in the open market. Except as described in this paragraph (c),
neither the Reporting Persons nor, to the best knowledge of the Reporting
Persons, any of the persons referred to in Annex 1 attached hereto, has effected
any transactions in the Common Stock during the past 60 days.
(d) Each of the Reporting Persons has the sole right to receive or the
power to direct the receipt of dividends from, or the proceeds from the sale of,
the Common Stock, if any, directly owned by each of them.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
May Davis acted as Placement Agent with respect to the Company's private
placement completed in March 1996 of an aggregate of $250,000 principal amount
12% promissory notes, 200,000 shares of Common Stock and 1,000,000 warrants to
purchase Common Stock. May Davis acted as Placement Agent with respect to the
Company's private placement completed in May 1996 in which it issued 200,000
shares of Common Stock. May Davis acted as Underwriter with respect to the
Company's initial public offering completed in August 1996 of 950,000 shares of
Common Stock. In connection with the Company's initial public offering, the
Company issued to May Davis warrants (the "Underwriter's Warrants"), at a price
of $10.00 per warrant, which entitle the holder to purchase up to 90,000 shares
of Common Stock and/or 60,000 warrants to purchase common stock (the
"Warrants"). The Underwriter's Warrant is exercisable at a price of $6.60 per
share of Common Stock and $.12 per Warrant, for a period of four years
commencing on 1997.
In connection with the Company's initial public offering, the Company
agreed that for a period of three years, May Davis would have the right to
designate a person to be a non-voting advisor to the Company's Board of
Directors. May Davis has designated Mr. Willard Holt (who is Mr. May's
brother-in-law) to such position. As of the date hereof, May Davis has been
informed by the Company that Mr. Holt has been approved by the Board of
Directors as a non-voting advisor; however Mr. Holt was not admitted to a recent
Board meeting and has not attended any Board meetings.
<PAGE>
In connection with the Company's initial public offering, the Company
entered into a Financial Advisory and Investment Banking Agreement, (the
"Financial Advisory Agreement") with May Davis, pursuant to which May Davis was
engaged by the Company for a term of three years, to render consulting advice
and to the Company as an investment banker relating to financial and similar
matters, including to seek out acquisitions and transactions outside of the
ordinary course, upon the terms and conditions set forth therein.
In connection with the Company's initial public offering, Mr. Sal entered
into an agreement with May Davis, pursuant to which Mr. Sal agreed that for a
period of twenty-four months, he would not sell any shares of Common Stock to
the public without the prior written consent of May Davis (the "Lock-up
Agreement").
On February 28, 1997, May Davis delivered a request for a stockholders list
in accordance with Section 220 of the Delaware General Corporation Law for the
purpose of commencing a consent solicitation to remove the current Board of
Directors of the Company and to replace such directors with nominees selected by
May Davis.
The foregoing summaries of each of the Underwriter's Warrant, the Financial
Advisory Agreement and the Lock-up Agreement is qualified in its entirety by
reference to the text of each such agreement or form thereof, which is attached
hereto as Exhibits 3, 4 and 5 respectively, and is incorporated herein by
reference.
Except as described herein, neither any of the Reporting Persons nor any
other person referred to in Annex 1 attached hereto, has any contracts,
arrangements, understandings or relationships (legal or otherwise) with any
person with respect to any securities of the Company, including but not limited
to transfer or voting of any of the securities, finder's fees, joint ventures,
loan or option arrangements, puts or calls, guarantees or profits, division of
profits or loss, or the giving or withholding of proxies.
ITEM 7. MATERIAL TO BE FILED.
(a) Joint Filing Agreement.
(b) Underwriter's Warrant, issued by NetLive Communications, Inc. to May
Davis Group, Inc.
(c) Financial Advisory and Investment Banking Agreement, between NetLive
Communications, Inc. and May Davis Group, Inc.
(d) Form of Letter Agreement, between May Davis Group, Inc. and Dennis Sal
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
March 7, 1997 MAY DAVIS GROUP, INC.
By: /s/ Owen May
------------------------------------
Owen May
Chairman and Chief Executive Officer
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
March 7, 1997 /s/ Owen May
------------------------------------
Owen May
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
March 7, 1997 /s/ Dibo Attar
------------------------------------
Dibo Attar
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
March 7, 1997 /s/ Dennis Sal
------------------------------------
Dennis Sal
<PAGE>
ANNEX I
DIRECTORS AND EXECUTIVE OFFICERS OF THE REPORTING PERSONS
The names, present principal occupations and business addresses of the
directors and executive officers of each of May Davis Group, Inc. are set forth
below. If no address is given, the director's or executive officer's business
address is that of May Davis Group, Inc. Unless otherwise indicated, each
occupation set forth opposite an individual's name refers to May Davis Group,
Inc. Each of the named individuals is a citizen of the United States of America.
- --------------------------------------------------------------------------------
NAME POSITION
- --------------------------------------------------------------------------------
Owen May Director, Chairman and Chief Executive Officer
- --------------------------------------------------------------------------------
Kevin Davis Director and President
- --------------------------------------------------------------------------------
<PAGE>
ANNEX 2
Schedule of Transactions in the Shares
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
Name Date No. of Shares Purchased No. of Shares Sold Price Per Share (1)
- ---- ---- ----------------------- ------------------ -------------------
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
May Davis
Group, Inc. (2)
- -------------------------------------------------------------------------------------------------------------
Dibo Attar (3) 2/26/97 58,600 $4.27 (4)
- -------------------------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------
(1) Excludes brokerage commissions.
(2) Excludes transactions in the ordinary course of market making activities.
(3) Purchase in a private transaction made directly by a Fund (as defined in
Item 5 of this Schedule 13D) which has granted a power of attorney to an
employee of a corporation which Mr. Attar controls. See Item 5.
(4) No brokerage commissions.
<PAGE>
EXHIBIT INDEX
Exhibit No. Document
- ----------- --------
1 Joint Filing Agreement
2 Underwriter's Warrant, issued by NetLive
Communications, Inc. to May Davis Group, Inc.
3 Financial Advisory and Investment Banking Agreement,
between NetLive Communications, Inc. and May Davis
Group, Inc.
4 Form of Letter Agreement, between May Davis Group, Inc.
and Dennis Sal
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) promulgated under the Securities Exchange
Act of 1934, the undersigned agree to the joint filing of a Statement on
Schedule 13D (including any and all amendments thereto) with respect to the
shares of common stock, par value $.0001 per share, of NetLive Communications,
Inc., and further agree that this Joint Filing Agreement be included as an
Exhibit thereto. In addition, each party to this Agreement expressly authorizes
each other party to this Agreement to file on its behalf any and all amendments
to such statement.
Date: March 7, 1997 MAY DAVIS GROUP, INC.
By: /s/ Owen May
------------------------------------
Owen May
Chairman and Chief Executive Officer
/s/ Owen May
-----------------------------------------
Owen May
/s/ Dibo Attar
-----------------------------------------
Dibo Attar
/s/ Dennis Sal
-----------------------------------------
Dennis Sal
UW-001 _________ WARRANTS
UNDERWRITER'S WARRANT
Dated: August 21, 1996
THIS CERTIFIES THAT May Davis Group, Inc. (the "Holder") is entitled to
purchase from NETLIVE COMMUNICATIONS, INC., a Delaware corporation (the
"Company"), up to 95,000 shares of the Company's common stock, $.0001 par value
(the "Shares"), and/or 73,000 redeemable common stock purchase warrants (the
"Redeemable Warrants"; together with the Shares, the "Securities") to purchase
one share of Common Stock at $5.50 per share (the "Redeemable Warrant Exercise
Price") at a purchase price of $8.25 per Share (the "Share Exercise Price") and
$.15 per Redeemable Warrant (the "Warrant Exercise Price, " collectively, with
the Share Exercise Price, the "Exercise Prices"), subject to adjustment as
provided in paragraph 8 hereof, at any time during the 48 month period
commencing 12 months from the effective date of the Registration Statement
(defined below). This Underwriter's Warrant (the "Underwriter's Warrant") is
exercisable to purchase an aggregate of 95,000 Shares and 73,000 Redeemable
Warrants, issued pursuant to an Underwriting Agreement dated August 12, 1996,
between the Company and May Davis Group, Inc. (the "Underwriter") (as defined in
the Underwriting Agreement), in connection with a public offering, through the
Underwriter, of 950,000 shares of Common Stock and 730,000 Redeemable Warrants
as therein described (and up to an additional 142,500 shares of Common Stock and
109,500 Redeemable Warrants (the "Option Securities" covered by an
over-allotment option granted by the Company and the Selling Stockholders (as
defined in the Underwriting Agreement) to the Underwriter) hereinafter referred
to together with the Option Securities, as the "Public Securities") and in
consideration of $10.00 received by the Company for the Underwriter's Warrant.
The Shares and Redeemable Warrants issuable pursuant to the Underwriter's
Warrant shall have same terms and conditions as the shares of Common Stock and
Redeemable Warrants making up the Public Securities, as described under the
caption "Description of Securities" in the Company's Registration Statement on
Form SB-2, File No. 333-4057 (the "Registration Statement"), except that the
Holder shall have registration rights under the Securities Act of 1933 (the
"Act"), for the Underwriter's Warrant, the Shares and Redeemable Warrants.
1. The rights represented by this Underwriter's Warrant shall be
exercised at the price, subject to adjustment in accordance with paragraph 8
hereof, and during the periods as follows:
(a) During the period from the date hereof to August 11, 1997 [12
months from the effective date] (the "Initial Period"),
inclusive, the Holder shall have no right to purchase any
Securities hereunder.
1
<PAGE>
(b) Between August 12, 1997 and August 12, 2001 [5 years from the
effective date] (the "Expiration Date") inclusive, the Holder
shall have the option to purchase Shares hereunder at a price of
$8.25 per Share and to purchase Redeemable Warrants at a price of
$.15 per Redeemable Warrant [150% above the public offering price
of the Shares and Redeemable Warrants], subject to adjustment as
provided in paragraph 8 hereof.
(c) After the Expiration Date, the Holder shall have no right to
purchase any Securities hereunder.
2. (a) The rights represented by this Underwriter's Warrant may be
exercised at any time within the periods above specified, in whole or in part,
by (i) the surrender of the Underwriter's Warrant (with the purchase form at the
end hereof properly executed) at the principal executive office of the Company
(or such other office or agency of the Company as it may designate by notice in
writing to the Holder at the address of the Holder appearing on the books of the
Company); (ii) payment to the Company of the exercise price then in effect for
the number of Securities specified in the above-mentioned purchase form together
with applicable stock transfer taxes, if any; and (iii) delivery to the Company
of a duly executed agreement signed by the person(s) designated in the purchase
form to the effect that such person(s) agree(s) to be bound by the provisions of
paragraph 6 and subparagraphs (b), (c) and (d) of paragraph 7 hereof. The
Underwriter's Warrant shall be deemed to have been exercised, in whole or in
part to the extent specified, immediately prior to the close of business on the
date the Underwriter's Warrant is surrendered and payment is made in accordance
with the foregoing provisions of this paragraph 2, and the person or persons in
whose name or names the certificates for Shares and/or Redeemable Warrants shall
be issuable upon such exercise shall become the holder or holders of record of
such Shares and Redeemable Warrants at that time and date. Certificates
representing the Shares and Redeemable Warrants so purchased shall be delivered
to the Holder within a reasonable time, not exceeding ten (10) days, after the
rights represented by this Warrant shall have been so exercised.
(b) Notwithstanding anything to the contrary contained in
subparagraph (a) of paragraph 2, the Holder may elect to exercise this
Underwriter's Warrant in whole or in part by receiving Shares and/or Redeemable
Warrants equal to the value (as determined below) of this Underwriter's Warrant
at the principal office of the Company together with notice of such election in
which event the Company shall issue to the Holder a number of Shares and/or
Redeemable Warrants computed using the following formula:
X = Y(A-B)
----------
A
Where: X = the number of Shares and/or Warrants to be issued to the
Holder;
2
<PAGE>
Y = the number of Shares and/or Warrants to be exercised under
this Underwriter's Warrant;
A = the current fair market value of one share of Common Stock
and/or one Warrant (calculated as described below); and
B = the Share Exercise Price and/or the
Warrant Exercise Price, as the case may be.
As used herein, the current fair market value of one share of Common Stock
shall mean the greater of (x) the average of the closing prices of the Company's
Common Stock sold on all securities exchanges on which the Common Stock may at
the time be listed and the NASDAQ National Market, or, if there have been no
sales on any such exchange or the NASDAQ National Market on such day, the
average of the highest bid and lowest asked price on such day on The Nasdaq
Stock Market or otherwise in the domestic over-the-counter market as reported by
the National Quotation Bureau, Incorporated, or any similar successor
organization (the "Market Price"), on the trading day immediately preceding the
date notice of exercise of this Underwriter's Warrant is given or (y) the
average of the Market Price per share of Common Stock for the five trading days
immediately preceding the date notice of exercise of this Underwriter's Warrant
is given. If on any date for which the Market Price per share of Common Stock is
to be determined the Common Stock is not listed on any securities exchange or
quoted on the NASDAQ National Market or on The Nasdaq Stock Market or otherwise
in the over-the-counter market, the Market Price per share of Common Stock shall
be the highest price per share which the Company could then obtain from a
willing buyer (not a current employee or director) for shares of Common Stock
sold by the Company, from authorized but unissued shares, as determined in good
faith by the Board of Directors of the Company, unless prior to such date the
Company has become subject to a merger, acquisition or other consolidation
pursuant to which the Company is not the surviving party, in which case the
Market Price per share of Common Stock shall be deemed to be the value received
by the holders of the Company's Common Stock for each share thereof pursuant to
the Company's acquisition.
The current fair market value of one Redeemable Warrant shall be determined
in a like manner, with reference to the prices per Redeemable Warrant.
3. The Underwriter's Warrant shall not be transferred, sold, assigned, or
hypothecated (other than by will or pursuant to the laws of descent and
distribution) for a period of one year commencing August 12, 1996, except that
it may be transferred to successors of the Holder, and may be assigned in whole
or in part to any person who is an officer or director of the Holder or to any
member of the selling group and/or the officers/directors or partners thereof
during such period. Any such assignment shall be effected by the Holder by (i)
executing the form of assignment at the end hereof and (ii) surrendering the
Underwriter's Warrant for cancellation at the office or agency of the Company
referred to in paragraph 2 hereof,
3
<PAGE>
accompanied by a certificate (signed by an officer of the Holder if the Holder
is a corporation), stating that each transferee is a permitted transferee under
this paragraph 3; whereupon the Company shall issue, in the name or names
specified by the Holder (including the Holder) a new Underwriter's Warrant or
Warrants of like tenor and representing in the aggregate rights to purchase the
same number of Securities as are purchasable hereunder.
4. The Company covenants and agrees that all shares of Common Stock which
may be purchased hereunder or upon exercise of the Redeemable Warrants will,
upon issuance against payment of the purchase price therefor, be duly and
validly issued, fully paid and nonassessable, and no personal liability will
attach to the holder thereof. The Company further covenants and agrees that,
during the periods within which the Underwriter's Warrant may be exercised, the
Company will at all times have authorized and reserved a sufficient number of
shares of its Common Stock to provide for the exercise of the Underwriter's
Warrant and the Redeemable Warrants.
5. The Underwriter's Warrant shall not entitle the Holder to any voting
rights or other rights as stockholders of the Company.
6. (a)(i) The Company shall advise the Holder or its transferees, whether
the Holder holds the Underwriter's Warrant or has exercised the Underwriter's
Warrant and holds shares of Common Stock and/or Redeemable Warrants, by written
notice at least four weeks prior to the filing of any post-effective amendment
to the Registration Statement or of any new registration statement or
post-effective amendment thereto under the Act covering any securities of the
Company, for its own account or for the account of others, except for any
registration statement filed on Form S-4 or S-8 (including a Form S-3 related to
a Form S-8) and will, for a period of five years from the Effective Date, upon
the request of the Holder, and subject to subparagraph 6(a)(ii), include in any
such post-effective amendment to the Registration Statement or in any new
registration statement such information as may be required to permit a public
offering of the Underwriter's Warrant, the Common Stock issuable upon the
exercise thereof or upon exercise of the Redeemable Warrants and the Redeemable
Warrants (collectively, the "Registrable Securities"). The Company shall supply
prospectuses and such other document as the Holder may reasonably request in
order to facilitate the public sale or other disposition of the Registrable
Securities, use its best efforts to register and qualify any of the Registrable
Securities for sale in such states as the Holder designates and do any and all
other acts and things which may be necessary or desirable to enable the Holder
to consummate the public sale or other disposition of the Registrable
Securities, all at no expense to the Holder or the Underwriter, and furnish
indemnification in the manner provided in paragraph 7 hereof. The Holder shall
furnish information and indemnification as set forth in paragraph 7.
(ii) If the registration of which the Company gives notice is for a
registered public offering involving an underwriting, the Company shall so
advise the Holder as a part of the written notice given pursuant to subparagraph
6(a)(i). If the managing underwriter determines that a limitation of the number
of shares to be underwritten is required, the
4
<PAGE>
underwriter may exclude some or all Registrable Securities from such
registration (the "Excluded Registrable Securities"); provided, however, that no
other security-holder may include any such securities in such Registration
Statement if any of the Registrable Securities have been excluded from such
registration; and further provided that the Company will file a new Registration
Statement covering the Excluded Registrable Securities, at the Company's
expense, within six months after the completion of such underwritten offering.
(b) On any one occasion only, any 50.1% Holder (as defined below)
shall give notice to the Company at any time to the effect that such Holder
desires to register under the Act any or all of the Registrable Securities under
such circumstances that a public distribution (within the meaning of the Act) of
any such securities will be involved, then the Company will promptly, but no
later than eight weeks after receipt of such notice, file a post-effective
amendment to the current Registration Statement or a new registration statement
pursuant to the Act, so that such designated Registrable Securities may be
publicly sold under the Act as promptly as practicable thereafter and the
Company will use its best efforts to cause such registration to become and
remain effective (including the taking of such steps as are necessary to obtain
the removal of any stop order) within 90 days after the receipt of such notice,
provided, that such Holder shall furnish the Company with appropriate
information in connection therewith as the Company may reasonably request in
writing. Inclusive of this demand right shall be that the 50.1% Holder may, at
its option, request the filing of a posteffective amendment to the current
Registration Statement or a new registration statement under the Act, inclusive
of the right granted by subparagraph 6(a) on one occasion only during the
four-year period beginning one year from the effective date of the Registration
Statement (the "Effective Date"). The 50.1% Holder may, at its option, request
the registration of the Underwriter's Warrant and/or any of the securities
underlying the Underwriter's Warrant in a registration statement made by the
Company as contemplated by subparagraph 6(a) or in connection with a request
made pursuant to this subparagraph 6(b) prior to acquisition of the shares of
Common Stock and/or Redeemable Warrants issuable upon exercise of the
Underwriter's Warrant. The 50% Holder may, at its option, request such
post-effective amendment or new registration statement during the described
period with respect to the Underwriter's Warrant, or separately as to the Common
Stock and/or Redeemable Warrants issuable upon the exercise of the Underwriter's
Warrant, and such registration rights may be exercised by the 50% Holder prior
to or subsequent to the exercise of this Underwriter's Warrant. Within ten days
after receiving any such notice pursuant to this subparagraph 6(b), the Company
shall give notice to any other Holder of the Underwriter's Warrant, advising
that the Company is proceeding with such post-effective amendment or
registration statement and offering to include therein the securities underlying
the Underwriter's Warrants held by the other Holder, provided that they shall
furnish the Company with such appropriate information (relating to the
intentions of such Holder) in connection therewith as the Company shall
reasonably request in writing. All costs and expenses of the post-effective
amendment or new registration statement shall be borne by the Company, except
that the Holder(s) shall bear the fees of their own counsel and any underwriting
discounts or commissions applicable to any of the securities sold by them. The
Company will maintain such registration statement or post-effective amendment
current under the Act for a period of at least
5
<PAGE>
nine months (and for up to an additional three months if requested by the
Holder(s)) from the effective date thereof. The Company shall provide
prospectuses, and such other documents as the Holder(s) may request in order to
facilitate the public sale or other disposition of the Registrable Securities,
use its best efforts to register and qualify any of the Registrable Securities
for sale in such states as such Holder(s) designate and furnish indemnification
in the manner provided in paragraph 7 hereof.
(c) The term "50.1% Holder" as used in this paragraph 6 shall mean
the Holder(s) of at least 50.1% of the Underwriter's Warrant and/or the Common
Stock underlying the Underwriter's Warrant and the Redeemable Warrants and shall
include any owner or combination of owners of such securities, which ownership
shall be calculated by determining the number of shares of Common Stock held by
such owner or owners as well as the number of shares then issuable upon exercise
of the Underwriter's Warrant and the Redeemable Warrants.
(d) If at any time prior to the effectiveness of the registration
statement filed in connection with an offering pursuant to this paragraph 6 the
50% Holder shall determine not to proceed with the registration, upon notice to
the Company and the payment to the Company by the 50% Holder of the Company's
expenses, if any, theretofore incurred in connection with the registration
statement, the 50% Holder may terminate its participation in the offering, and
the registration statement previously filed shall not be counted against the
number of demand registrations permitted under this paragraph 6.
(e) Notwithstanding the foregoing, if the Company shall furnish to
such 50% Holder a certificate signed by the President of the Company stating
that in the good faith judgment of the Board of Directors it would be seriously
detrimental to the Company or its stockholders for a registration statement to
be filed in the near future containing the disclosure of material information
required to be included therein by reason of the federal securities laws, then
the Company's obligation to use its best efforts to file a registration
statement shall be deferred for a period during which such disclosure would be
seriously detrimental, provided that this period will not exceed 30 days and
provided further, that the Company shall not defer its obligation in this matter
more than once in any 12 month period.
7. (a) Whenever pursuant to paragraph 6 a registration statement
relating to the Underwriter's Warrant or any Common Stock issued or issuable
upon the exercise of the Underwriter's Warrant or the Redeemable Warrants, or
any Redeemable Warrants is filed under the Act, amended or supplemented, the
Company will indemnify and hold harmless each Holder of the securities covered
by such registration statement, amendment or supplement (such Holder being
hereinafter called the "Distributing Holder"), and each person, if any, who
controls (within the meaning of the Act) the Distributing Holder, and each
underwriter (within the meaning of the Act) of such securities and each person,
if any, who controls (within the meaning of the Act) any such underwriter,
against any losses, claims, damages or liabilities, joint or several, to which
the Distributing Holder, any such controlling person or any such underwriter may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or
6
<PAGE>
liabilities, or actions in respect thereof, arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any such registration statement or any preliminary prospectus or final
prospectus constituting a part thereof or any amendment or supplement thereto,
or arise out of or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading and will reimburse the Distributing Holder or
such controlling person or underwriter in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
said registration statement, said preliminary prospectus, said final prospectus
or said amendment or supplement in reliance upon and in conformity with written
information furnished by such Distributing Holder or any other Distributing
Holder for use in the preparation thereof.
(b) The Distributing Holder will indemnify and hold harmless the
Company, each of its directors, each of its officers who have signed said
registration statement and such amendments and supplements thereto, and each
person, if any, who controls the Company (within the meaning of the Act) against
any losses, claims, damages or liabilities, joint or several, to which the
Company or any such director, officer or controlling person may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities, or actions in respect thereof, arise out of or are based upon any
untrue or alleged untrue statement of any material fact contained in said
registration statement, said preliminary prospectus, said final prospectus, or
said amendment or supplement, or arises out of or are based upon the omission or
the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in said registration statement,
said preliminary prospectus, said final prospectus or said amendment or
supplement in reliance upon and in conformity with written information furnished
by such Distributing Holder for use in the preparation thereof; and will
reimburse the Company or any such director, officer or controlling person for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action.
(c) Promptly after receipt by an indemnified party under this
paragraph 7 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against any indemnifying
party, give the indemnifying party notice of the commencement thereof, but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than under this
paragraph 7.
(d) In case any such action is brought against any indemnified party,
and it notified an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate in and, to the extent that it
may wish, jointly with any other
7
<PAGE>
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party, and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party will not be liable to such
indemnified party under this paragraph 7 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
8.(A) The Share Exercise Price in effect at any time and the number and
kind of securities purchasable upon the exercise of the Underwriter's Warrant
shall be subject to adjustment from time to time upon the happening of certain
events hereinafter described; provided, however, that no adjustment shall be
required in respect of the shares issuable upon exercise of the Redeemable
Warrants.
(i) In case the Company shall (a) declare a dividend or make a
distribution on its outstanding shares of Common Stock in shares of Common
Stock, (b) subdivide or reclassify its outstanding shares of Common Stock into a
greater number of shares, or (c) combine or reclassify its outstanding shares of
Common Stock into a smaller number of shares, or (d) the outstanding shares of
Common Stock of the Company are at any time changed into or exchanged for a
different number or kind of shares or other security of the Company or of
another corporation through reorganization, merger, consolidation, liquidation
or recapitalization, then appropriate adjustments in the number and kind of such
securities subject to this Underwriter's Warrant shall be made and the Share
Exercise Price in effect at the time of the record date for such dividend or
distribution or of the effective date of such subdivision, combination,
reclassification, reorganization, merger, consolidation, liquidation or
recapitalization shall be proportionately adjusted so that the Holder of this
Underwriter's Warrant exercised after such date shall be entitled to receive the
aggregate number and kind of securities which, if this Underwriter's Warrant had
been exercised by such Holder immediately prior to such date, they would have
owned upon such exercise and been entitled to receive upon such dividend,
distribution, subdivision, combination, reclassification, reorganization,
merger, consolidation, liquidation or recapitalization. For example, if the
Company declares a 2 for 1 stock distribution and the Share Exercise Price
immediately prior to such event was $5.00 per Share and the number of Shares
purchasable upon exercise of this Underwriter's Warrant was 110,000, the
adjusted Share Exercise Price immediately after such event would be $2.50 per
Share and the adjusted number of Shares purchasable upon exercise of this
Warrant would be 220,000. Such adjustment shall be made successively whenever
any event listed above shall occur.
(ii) Whenever the Share Exercise Price payable upon exercise of the
Underwriter's Warrant is adjusted pursuant to subparagraphs 8(A)(i), or the
Warrant Exercise Price payable upon exercise of the Underwriter's Warrant
pursuant to paragraph 8(B), the number of shares of Common Stock or Redeemable
Warrants, as the case may be, purchasable upon exercise of this Underwriter's
Warrant shall simultaneously be adjusted by multiplying the number of shares of
Common Stock or Redeemable Warrants, as the case may
8
<PAGE>
be, issuable upon exercise of this Underwriter's Warrant by the Share Exercise
Price or Warrant Exercise Price, as the case may be, in effect on the date
hereof and dividing the product so obtained by the Share Exercise Price or
Warrant Exercise Price, as adjusted.
(iii) No adjustment in the Share Exercise Price or Warrant Exercise
Price shall be required (a) in the event of the sale of the Company's securities
in a future bona fide underwritten public offering; or (b) unless such
adjustment would require an increase or decrease of at least five cents ($0.05)
in the Share Exercise Price; provided, however, that any adjustments which by
reason of this subparagraph (iii) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment required to be made
hereunder. All calculations under this paragraph 8(A) shall be made to the
nearest cent or to the nearest one-hundredth of a share, as the case may be.
Anything in this Section 8(A) to the contrary notwithstanding, the Company shall
be entitled, but shall not be required, to make such changes in the Share
Exercise Price or Warrant Exercise Price, in addition to those required by this
Section 8(A) or 8(B), as it shall determine, in its sole discretion, to be
advisable in order that any dividend or distribution in shares of Common Stock
or Redeemable Warrants, or any subdivision, reclassification or combination
thereof, hereafter made by the Company shall not result in any federal income
tax liability to the holders of Common Stock or securities convertible into
Common Stock (including the Redeemable Warrants issuable upon exercise of the
Underwriter's Warrant).
(iv) Whenever the Exercise Prices are adjusted, as herein provided,
the Company shall promptly cause a notice setting forth the adjusted Exercise
Prices and adjusted the number of shares of Common Stock, Redeemable Warrants or
other securities purchasable upon exercise of the Underwriter's Warrant to be
mailed to the Holder, at the addresses listed on the books of the Company, and
shall cause a certified copy thereof to be mailed to the Company's transfer
agent, if any. The Company may retain a firm of independent certified public
accountants selected by the Board of Directors (who may be the regular
accountants employed by the Company) to make any computation required by this
paragraph 8, and a certificate signed by such firm shall be conclusive evidence
of the correctness of such adjustment.
(v) In the event that at any time, as a result of an adjustment made
pursuant to the provisions of this paragraph 8, the Holder of the Underwriter's
Warrant thereafter shall become entitled to receive any securities of the
Company, other than Common Stock and the Redeemable Warrants, thereafter the
exercise price and number of such other securities so receivable upon exercise
of the Underwriter's Warrant shall be subject to adjustment from time to time in
a manner and on terms as nearly equivalent as practicable to the number of
shares of Common Stock, Redeemable Warrants or other securities purchasable upon
exercise of the Underwriter's Warrant to be mailed to the Holder, at the
addresses listed on the books of the Company, and shall cause a certified copy
thereof to be mailed to the Company's transfer agent, if any. The Company may
retain a firm of independent certified public accountants selected by the Board
of Directors (who may be the regular accountants employed by the Company) to
make
9
<PAGE>
any computation required by this paragraph 8, and a certificate signed by such
firm shall be conclusive evidence of the correctness of such adjustment.
(vi) In the event that at any time, as a result of an adjustment made
pursuant to the provisions of this paragraph 8, the Holder of the Underwriter's
Warrant thereafter shall become entitled to receive any securities of the
Company, other than Common Stock and the Redeemable Warrants, thereafter the
exercise price and number of such other securities so receivable upon exercise
of the Underwriter's Warrant 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 Common Stock contained in subparagraphs 8(A), inclusive of this
paragraph (vi).
8.(B) In the event of an adjustment in the Share Exercise Price and the
number of Shares of Common Stock issuable upon the exercise of the Underwriter's
Warrant, pursuant to paragraph 8(A), then there shall be a proportional
adjustment in the Warrant Exercise Price and the number of Redeemable Warrants
issuable upon the exercise of the Underwriter's Warrant.
9. This Agreement shall be governed by and in accordance with the laws of
the State of New York.
IN WITNESS WHEREOF, NETLIVE COMMUNICATIONS, INC. has caused this
Underwriter's Warrant to be signed by its duly authorized officers, and this
Underwriter's Warrant to be dated as of the date first above written.
NETLIVE COMMUNICATIONS, INC.
By: ____________________________________
Name:
Title:
10
FINANCIAL ADVISORY AND INVESTMENT BANKING AGREEMENT
This Agreement is made and entered into as of the 21st day of August, 1996
by and between May Davis Group, Inc., a Florida corporation ("MDG"), and Netlive
Communications, Inc., a Delaware corporation (the "Company").
In consideration of the mutual promises made herein and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Purpose: The Company hereby engages MDG for the term specified in
Paragraph 2 hereof to render consulting advice to the Company as an investment
banker relating to financial and similar matters upon the terms and conditions
set forth herein.
2. Term: Except as otherwise specified in Paragraph 4 hereof, this
Agreement shall be effective for a three (3) year period commencing August 12,
1996 and ending August 11, 1999.
3. Duties of MDG: During the term of this Agreement, MDG shall seek out
Transactions (as hereinafter defined) on behalf of the Company and shall furnish
advice to the Company in connection with any such Transactions.
4. Compensation: In consideration for the services rendered by MDG to the
Company pursuant to this Agreement (and in addition to the expenses provided for
in Paragraph 5 hereof), the Company shall compensate MDG as follows:
(a) The Company shall pay MDG a fee of $2,500 per month for the term
of this Agreement. The aggregate sum of $90,000 shall be due and payable upon
the execution of this Agreement.
1
<PAGE>
(b) In the event that any Transaction occurs during the term of this
Agreement, the Company shall pay fees to MDG as follows:
Consideration Fee
------------- ---
$ - 0 - to $ 500,000 $25,000
Above $ 500,000 to $5,000,000 5% of Consideration
Above $5,000,000 $250,000 plus 1% of the
Consideration in excess of
$5,000,000
For the purposes of this Agreement, "Consideration" shall mean the
total market value, as determined by the Company's Board of Directors on the day
of the closing of the Transaction, of stock, cash, assets and all other property
(real or personal) exchanged or received, directly or indirectly, by the Company
or any of its security holders in connection with any Transaction. Any co-broker
retained by MDG shall be paid by MDG.
(c) For the purposes of the Agreement, a "Transaction" shall mean (i)
any transaction introduced to the Company by MDG, other than in the ordinary
course of trade or business of the Company, whereby, directly or indirectly,
control of, or a material interest in, the Company or any of its businesses or
substantially all of its assets, is transferred for Consideration, or (ii) any
transaction introduced to the Company by MDG whereby the Company acquires any
other unaffiliated company or substantially all of the assets of any other
unaffiliated company or a controlling interest in any other company (an
"Acquisition").
In the event MDG originates, at the Company's request, a line of
credit with a lender or a corporate partner, the Company and MDG will mutually
agree on a satisfactory
2
<PAGE>
fee and the terms of payment of such fee. In the event MDG introduces the
Company to a joint venture partner or customer and sales develop as a result of
the introduction, the Company agrees to pay a fee of two percent (2%) of total
sales generated directly from this introduction during the first two years
following the date of the first sale. Total sales shall mean gross receipts less
any applicable refunds, returns, allowances, credits, taxes and shipping charges
and monies paid by the Company by way of settlement or judgment arising out of
claims made by or threatened against the Company. Commission payments shall be
paid on the 15th day of each third month following the receipt of customers'
payments. In the event any adjustments are made to the total sales after the
commission has been paid, the Company shall be entitled, at its option, to an
appropriate refund or credit against future payments under this Agreement.
(d) All fees to be paid pursuant to this Agreement, except as
otherwise specified, are due and payable to MDG in cash or company check at the
closing or closings of any Transaction specified in Paragraph 4. In the event
that the Consideration is paid out over a period of time, MDG shall be paid its
pro-rata portion of such Consideration as the Company is paid. In the event that
this Agreement shall not be renewed or if terminated for any reason,
notwithstanding any such non-renewal or termination, MDG shall be entitled to a
full fee as provided under Paragraphs 4 and 5 hereof, for any Transaction for
which the discussions were initiated with a third party at the request of the
Company during the term of this Agreement and which is consummated within a
period of twelve months after non-renewal or termination of this Agreement.
Nothing herein shall impose any obligation on the part of the Company to enter
into any Transaction.
3
<PAGE>
5. Expenses of MDG: In addition to the fees payable hereunder and
regardless of whether any Transaction set forth in Paragraph 4 hereof is
proposed or consummated, the Company shall reimburse MDG for MDG's reasonable
travel and out-of-pocket expenses incurred in connection with the services
performed by MDG pursuant to this Agreement and at the request of the Company,
including without limitation, hotels, food and associated expenses and
long-distance telephone calls, except that all expenses exceeding $100 must be
preapproved in writing by the Company and that total expenses may not exceed
$1,000.
6. Liability of MDG:
(1) The Company acknowledges that all opinions and advice (written or
oral) given by MDG to the Company in connection with MDG's engagement are
intended solely for the benefit and use of the Company in considering the
Transaction to which they relate, and the Company agrees that no person or
entity other than the Company shall be entitled to make use of or rely upon the
advice of MDG to be given hereunder, and no such opinion or advice shall be used
for any other purpose or reproduced, disseminated, quoted or referred to at any
time, in any manner or for any purpose, nor may the Company make any public
references to MDG, or use MDG's name in any annual reports or any other reports
or releases of the Company without MDG's prior written consent or as required by
law.
(2) The Company acknowledges that MDG makes no commitment whatsoever
as to making a market in the Company's securities or to recommending or advising
its clients to purchase the Company's securities. Research reports or corporate
finance reports that may be prepared by MDG will, when and if prepared, be done
solely on the merits or judgment of analysis of MDG or any senior corporate
finance personnel of MDG.
4
<PAGE>
7. MDG's Services to Others: The Company acknowledges that MDG or its
affiliates are in the business of providing financial services and consulting
advice to others. Nothing herein contained shall be construed to limit or
restrict MDG in conducting such business with respect to others, or in rendering
such advice to others, except that MDG will not provide services to others when
such services may materially and adversely affect the Company.
8. Company Information:
(a) The Company recognizes and confirms that, in advising the Company
and in fulfilling its engagement hereunder, MDG will use and rely on data,
material and other information furnished to MDG by the Company. The Company
acknowledges and agrees that in performing its services under this engagement,
MDG may rely upon the data, material and other information supplied by the
Company without independently verifying the accuracy, completeness or veracity
of same.
(b) Except as required by applicable law, MDG shall keep confidential
all non-public information provided to it by the Company, and shall not disclose
such information to any third party without the Company's prior written consent,
other than such of its employees and advisors as MDG reasonably determines to
have a need to know, provided, that MDG shall instruct such employees and
advisors to keep such information confidential and MDG shall be liable for any
breach of such confidentiality. In the event that MDG is required by subpoena to
disclose such information, the Company shall be afforded an opportunity to seek
an order preserving the confidentiality of such information.
5
<PAGE>
9. Indemnification:
(a) The Company shall indemnify and hold MDG harmless against any and
all liabilities, claims, lawsuits, including any and all awards and/or judgments
to which it may become subject under the Securities Act of 1933, as amended (the
"1933 Act"), the Securities Exchange Act of 1934, as amended (the "Act") or any
other federal or state statute, at common law or otherwise, insofar as said
liabilities, claims and lawsuits (including costs, expenses, awards and/or
judgments) arise out of or are in connection with the services rendered by MDG
or any transactions in connection with this Agreement, except for any
liabilities, claims and lawsuits (including awards and/or judgments), arising
out of acts or omissions of MDG. In addition, the Company shall also indemnify
and hold MDG harmless against any and all costs and expenses, including
reasonable counsel fees, incurred relating to the foregoing.
MDG shall give the Company prompt notice of any such liability, claim
or lawsuit which MDG contends is the subject matter of the Company's
indemnification and the Company thereupon shall be granted the right to take any
and all necessary and proper action, at its sole cost and expense, with respect
to such liability, claim and lawsuit, including the right to settle, compromise
and dispose of such liability, claim or lawsuit, excepting therefrom any and all
proceedings or hearings before any regulatory bodies and/or authorities and
provided that no such settlement shall be made without the prior consent of MDG.
MDG shall indemnify and hold the Company harmless against any and all
liabilities, claims and lawsuits, including any and all awards and/or judgments
to which it may become subject under the 1933 Act, the Act or any other federal
or state statute, at common law or otherwise, insofar as said liabilities,
claims and lawsuits (including costs, expenses, awards and/or
6
<PAGE>
judgments) arise out of or are in connection with the services rendered by MDG
or any transactions in connection with this Agreement. In addition, MDG shall
also indemnify and hold the Company harmless against any and all costs and
expenses, including reasonable counsel fees, incurred relating to the foregoing.
The Company shall give MDG prompt notice of any such liability, claim
or lawsuit which the Company contends is the subject matter of MDG' s
indemnification and MDG thereupon shall be granted the right to take any and all
necessary and proper action, at its sole cost and expense, with respect to such
liability, claim and lawsuit, including the right to settle, compromise or
dispose of such liability, claim or lawsuit, excepting therefrom any and all
proceedings or hearings before any regulatory bodies and/or authorities and
provided that no such settlement shall be made without the prior consent of the
Company.
(b) In order to provide for just and equitable contribution under the
Act in any case in which (i) any person entitled to indemnification under this
Paragraph 9 makes claim for indemnification pursuant hereto but it is judicially
determined (by the entry of a final judgment or decree by a court of competent
jurisdiction and the expiration of time to appeal or the denial of the last
right of appeal) that such indemnification may not be enforced in such case
notwithstanding the fact that this Paragraph 9 provides for indemnification in
such case, or (ii) contribution under the Act may be required on the part of any
such person in circumstances for which indemnification is provided under this
Paragraph 9, then, and in each such case, the Company and MDG shall contribute
to the aggregate losses, claims, damages or liabilities to which they may be
subject (after any contribution from others) in such proportion taking into
consideration the relative benefits received by each party from the transactions
undertaken in connection with this Agreement (taking
7
<PAGE>
into account the portion of the proceeds realized by each), the parties'
relative knowledge and access to information concerning the matter with respect
to which the claim was assessed, the opportunity to correct and prevent any
statement or omission and other equitable considerations appropriate under the
circumstances; and provided, that, in any such case, no person guilty of a
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
Within fifteen (15) days after receipt by any party to this Agreement
(or its representative) of notice of the commencement of any action, suit or
proceeding, such party will, if a claim for contribution in respect thereof is
to be made against another party (the "Contributing Party"), notify the
Contributing Party of the commencement thereof, but the omission so to notify
the Contributing Party will not relieve it from any liability which it may have
to any other party other than for contribution hereunder. In case any such
action, suit or proceeding is brought against any party, and such party notifies
a Contributing Party or his or its representative of the commencement thereof
within the aforesaid fifteen (15) days, the Contributing Party will be entitled
to participate therein with the notifying party and any other Contributing Party
similarly notified. Any such Contributing Party shall not be liable to any party
seeking contribution on account of any settlement of any claim, action or
proceeding effected by such party seeking contribution without the written
consent of the Contributing Party. The indemnification provisions contained in
this Paragraph 9 are in addition to any other rights or remedies which either
party hereto may have with respect to the other or hereunder.
10. MDG an Independent Contractor: MDG shall perform its services
hereunder as an independent contractor and not as an employee of the Company or
an affiliate
8
<PAGE>
thereof. The parties hereto expressly understand and agree that MDG shall have
no authority to act for, represent or bind the Company or any affiliate thereof
in any manner, except as may be agreed to expressly by the Company in writing
from time to time.
11. Miscellaneous:
(1) This Agreement between the Company and MDG constitutes the entire
agreement and understanding of the parties hereto, and supersedes any and all
previous agreements and understandings, whether oral or written, between the
parties with respect to the matters set forth herein.
(2) All communications hereunder, except as herein otherwise
specifically provided, shall be in writing and, if sent to MDG, shall be mailed,
delivered or telegraphed and confirmed to May Dais Group, Inc., 20 Exchange
Place, New York, New York 10005, Attention: President, with a copy to Gersten,
Savage, Kaplowitz & Curtin, LLP, 575 Lexington Avenue, New York, New York 10022,
Attention: Jay Kaplowitz, Esq., and if to the Company, shall be mailed,
delivered or telegraphed and confirmed to Netlive Communications, Inc., 584
Broadway, New York, New York 10019, Attention: Laurence Rosen, with a copy to
Gusrae, Kaplan & Bruno, 120 Wall Street, New York, New York 10005, Attention:
Lawrence G. Nusbaum, Esq.
(3) This Agreement shall be binding upon and inure to the benefit of
each of the parties hereto and their respective successors, legal
representatives and assigns.
(4) This Agreement may be executed in any number of counterparts,
each of which together shall constitute one and the same original document.
9
<PAGE>
(5) No provision of this Agreement may be amended, modified or
waived, except in a writing signed by all of the parties hereto.
(6) This Agreement shall be construed in accordance with and governed
by the laws of the State of New York, without giving effect to its conflict of
law principles. The parties hereby agree that any dispute which may arise
between them arising out of or in connection with this Agreement shall be
adjudicated before a court located in New York City, and they hereby submit to
the exclusive jurisdiction of the courts of the State of New York located in New
York, New York and of the federal courts in the Southern District of New York
with respect to any action or legal proceeding commenced by any party, and
irrevocably waive any objection they now or hereafter may have respecting the
venue of any such action or proceeding brought in such a court or respecting the
fact that such court is an inconvenient forum, relating to or arising out of
this Agreement, and consent to the service of process in any such action or
legal proceeding by means of registered or certified mail, return receipt
requested, in care of the address set forth in Paragraph 11(2) hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
MAY DAVIS GROUP, INC.
By: ____________________________________
Name:
Title:
NETLIVE COMMUNICATIONS, INC.
By: ____________________________________
10
August 12, 1996
May Davis Group, Inc.
20 Exchange Place
New York, New York 10002
Re: NetLive Communications, Inc.
Dear Sir or Madame:
The undersigned, a beneficial owner of the common stock of NetLive
Communications, Inc. (the "Company"), par value $.0001 per share (the "Common
Stock"), and/or warrants, options or rights to purchase, or securities
convertible into, Common Stock, understands that the Company has filed with the
Securities and Exchange Commission (the "SEC") a registration statement on Form
SB-2 (no. 333-4057-NY) for the registration of Common Stock and redeemable
warrants (the "Redeemable Warrants") of the Company (the "Registration
Statement") in connection with a public offering of such securities. The
undersigned further understands that upon the effectiveness of the Registration
Statement, the Company and May Davis Group, Inc. (the "Underwriter") intend to
enter into an underwriting agreement (the "Underwriting Agreement") in
connection with such public offering.
In order to induce the Underwriter to proceed with such public offering,
the undersigned agrees, for the benefit of the Company and the Underwriter, that
should such public offering be effectuated, he/she will not, without the prior
written consent of the Underwriter, sell, assign, pledge, hypothecate or
otherwise dispose of, directly or indirectly, other than in private transfers in
which the transferee agrees to be bound by the provisions of this letter
agreement, any securities of the Company owned by him/her, or subsequently
acquired through the exercise of any options, warrants or rights, split or other
distribution of stock, or grant of options, rights or warrants with respect to
any such shares of Common Stock, during the twenty-four (24) month period
commencing on the date that the SEC declares the Registration Statement
effective, without the prior written consent of the Underwriter. Furthermore,
the undersigned will permit all certificates evidencing his/her shares of Common
Stock to be endorsed with the appropriate restrictive legends, and will consent
to the placement of appropriate stop transfer orders with the transfer agent for
the Company.
<PAGE>
May Davis Group, Inc.
March 7, 1997
Page 2
In the event that the Registration Statement becomes effective, the
undersigned agrees to be bound by the provisions of this Agreement.
Very truly yours,
________________________________________
Signature
________________________________________
Printed Name
_____________________________________
Please indicate number of
shares of Common Stock owned.
Please list any options, warrants,
rights or convertible securities
owned and the number of shares of
Common Stock issuable upon the
exercise or conversion of such
securities:
