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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
SOFTNET SYSTEMS, INC.
(Name of Issuer)
COMMON STOCK
$0.01 PAR VALUE
(Title of Class of Securities)
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833964-109
(Cusip Number)
CYBER NET TECHNOLOGIES
LIMITED
(Name of Persons Filing Statement)
Helen Chu
38th Floor
Citibank Tower, Citibank Plaza
3 Garden Road
Central, Hong Kong
Tel No.: 852-2514-8888
(Name, Address and Telephone Number of
Person Authorized to Receive Notices
and Communications)
December 13, 1999
(Date of Event which Requires Filing of this Statement)
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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: [ ]
Check the following box if a fee is being paid with this statement: [ ]
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SCHEDULE 13D
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CUSIP No. 833964109 Page 1 of 6 Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Cyber Net Technologies Limited
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
British Virgin Islands
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7 SOLE VOTING POWER
5,000,000 shares of Common Stock
NUMBER OF SHARES -----------------------------------------
BENEFICIALLY OWNED BY EACH 8 SHARED VOTING POWER
REPORTING PERSON WITH
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9 SOLE DISPOSITIVE POWER
5,000,000 shares of Common Stock
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10 SHARED DISPOSITIVE POWER
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,000,000 shares of Common Stock
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN [ ]
SHARES*
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
23.9%
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14 TYPE OF REPORTING PERSON*
CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
SEC 1746 (9-88) 2 of 7
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Item 1. Security and Issuer.
The class of equity securities to which this statement relates is the
Common Stock, $0.01 par value per share (the "Shares"), of SoftNet Systems,
Inc., a Delaware corporation (the "Issuer"). The principal executive offices of
the Issuer are located at 650 Townsend Street, Suite 225, San Francisco, CA
94103.
Item 2. Identity and Background.
The name of the person filing this statement is Cyber Net Technologies
Limited, a British Virgin Islands corporation (the "Buyer"). Cyber Net
Technologies Limited is principally engaged in the business of investment in
securities.
The registered address of the Buyer is TrustNet Chambers, P.O. Box 3444,
Road Town, Tortola, British Virgin Islands. The name, business address, present
principal occupation or employment, and citizenship of each director and
executive officer of the Buyer is set forth on Schedule A.
The Buyer is a wholly-owned subsidiary of Pacific Century Cyberworks
Limited ("PCCW"), a Hong Kong corporation of limited liability. Mr. Li Tzar
Kai, Richard holds the entire issued share capital of Pacific Century Group
Holdings Limited ("PCG"), which holds approximately 4.8% of the entire issued
share capital of PCCW. PCG in turn beneficially owns the majority of the
outstanding shares of Pacific Century Regional Developments Limited ("PCRD")
which holds approximately 51.3% of the entire issued share capital of PCCW.
Pacific Century Diversified Limited ("PCD") also holds approximately 8.3% of
the entire issued share capital of PCCW and is a wholly-owned subsidiary of
Chiltonlink Limited ("Chiltonlink"). Mr. Li Tzar Kai, Richard is an interested
owner in approximately 64.4% (held through PCG, PCRD and PCD) of the entire
issued share capital of PCCW.
During the last five years, neither the Buyer, nor any other person
described above, nor, to the best of its knowledge, any of the persons listed
on Schedule A attached hereto, has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors) or has been 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.
Item 3. Source and Amount of Funds or Other Consideration.
The Reporting Person has purchased an aggregate of 5,000,000 shares of
Issuer's Common Stock (the "Shares") for an aggregate purchase price of
$128,750,000 (the "Purchase Price"). The purchases were financed with cash on
hand provided by the Buyer's parent corporation, Pacific Century Cyberworks
Limited, a Hong Kong corporation of limited liability.
Item 4. Purpose of Transaction.
The Buyer has acquired the Shares for investment. The Buyer intends to
review from time to time the Issuer's business affairs and financial position.
Based on such evaluation and review, as well as general economic and industry
conditions existing at the time, the Buyer may consider from time to time
various alternative courses of action. Such actions may include the acquisition
of additional Shares through open market purchases, privately negotiated
transactions, tender offer, exchange offer or otherwise. Alternatively, such
actions may involve the sale of all or a portion of the Shares in the open
market, in privately negotiated transactions, through a public offering or
otherwise.
Pursuant to the Stock Purchase Agreement dated as of October 12, 1999 (the
"Agreement") between the Pacific Century Cyberworks Limited, a Hong Kong
corporation of limited liability which is the indirect parent corporation of
the Buyer, and the Issuer, the Buyer is entitled to appoint two directors to
the Board of the Issuer for so long as the Buyer owns the Shares. In the event
the Buyer sells or otherwise disposes of such Shares, then it shall be entitled
to a number of Directors that is pro rata to its ownership of the outstanding
shares of Common Stock (rounded down to the nearest whole number of Directors).
The Buyer Director shall be subject to the prior approval of the Board of
Directors, such approval not to be unreasonably withheld.
In connection with any issuance by the Issuer of shares of Common Stock,
the Issuer has agreed to offer the Buyer an opportunity to acquire (on the
terms and subject to the conditions generally applicable to such issuance) a
sufficient number of shares to maintain the Buyer's then-existing percentage of
ownership of the Issuer's issued and outstanding shares of Common Stock;
provided that the Buyer has no such right in connection with the issuance of
shares of Common Stock to service providers, in connection with an acquisition
of a business entity or property or to a strategic buyer in connection with a
transaction approved by
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the Board of Directors, and provided further that in connection with any public
offering for cash, the Buyer is entitled to acquire shares at a price equal to
the public offering price less the underwriter's commission or discount.
Pursuant to the Agreement, the Buyer (and its parent and other controlling
entities) are subject to the following restrictions with respect to the Shares:
(a) Except pursuant to a Change of Control (as defined below), the Buyer
has agreed not to sell, pledge, encumber or otherwise transfer, or agree to
sell, pledge, encumber or otherwise transfer, directly or indirectly, any
Shares for a period of six months from and after December 13, 1999; provided,
that prior to the expiration of such period with the prior written consent of
the Issuer, and thereafter in its sole discretion, the Buyer may sell, pledge,
encumber or otherwise transfer the Shares (a) (i) in any transaction (other
than a transaction described in (iii) below) in compliance with Rule 144 under
the Securities Act or any successor rule or regulation, (ii) in a public
offering, registered under the Securities Act or (iii) in a private transaction
exempt from the registration requirements of the Securities Act (but only if
the Buyer reasonably believes after due inquiry that the acquiror, following
such transaction, will not be the beneficial owner of more than 5% of the
outstanding shares of Common Stock), and (b) to Permitted Transferees. A
"Permitted Transferee" means a person that (A) has agreed in writing to be
bound by the terms of the Agreement and (B) an affiliate of the Buyer.
(b) The Buyer has agreed not to purchase any additional shares of Common
Stock without the prior written consent of the Issuer (which shall not be
unreasonably withheld until the Buyer is the beneficial owner of up to 30% of
the outstanding shares of Common Stock and which may be withheld in the sole
discretion of the Issuer if the Buyer owns 30% or more of the outstanding
shares of Common Stock). The Buyer has agreed not to make a formal proposal to
acquire control of the Issuer unless it is invited to do so by the Board of
Directors.
(c) In connection with any transaction involving the merger of the Issuer
with or into any other person or any acquisition of 50% or more of the
outstanding Common Stock by any other person or any other transaction that
effects a change in control of the Issuer, in each case at a per share price
higher than $25.75 (a "Change of Control"), the Buyer has agreed to cause its
shares of Common Stock to be voted in the same proportion as shareholders
(other than the Buyer or any affiliate of the Issuer) who individually hold
less than 5% of the outstanding Common Stock, provided that the person involved
in such Change of Control is not a material competitor of the Buyer in Asia
(and if the person is a material competitor of the Buyer in Asia, then the
Buyer shall be free to vote its shares as it wishes).
(d) Until the fifth anniversary of the Closing Date, the Buyer has agreed
that it will not solicit, encourage or recommend to other shareholders of the
Issuer that they vote their shares of Common Stock in favor of any nominee or
nominees for Director other than those duly proposed and nominated in
accordance with the Agreement.
Except as set forth above, the Buyer has no plan or proposals which relate
to or would result in 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 Buyer has acquired and, for the purpose of Rule 13d-3 promulgated
under the Exchange Act, beneficially owns 5,000,000 Shares, representing
approximately 23.9% of the outstanding Shares of the Issuer based on the number
of Shares listed in the Issuer's 10-Q for the period ended April 30, 1999,
filed with the SEC on August 16, 1999.
Except as set forth in this Item 5(a), neither the Buyer, nor any other
person controlling the Buyer, nor, to the best of its knowledge, any persons
named in Schedule A hereto owns beneficially any Shares.
(b) The Buyer has sole power to vote and to dispose of 5,000,000 Shares.
(c) Inapplicable.
(d) Inapplicable.
(e) Inapplicable.
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Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
The responses to Item 2, Item 3, and Item 4 are incorporated herein by
reference.
The foregoing response to this Item 6 is qualified in its entirety by
reference to the Agreement, the full text of which is incorporated by reference
in Exhibit 1 hereto and hereby by this reference.
Except for the Agreement as described above, to the best knowledge of the
Buyer, there are no contracts, arrangements, understandings or relationships
(legal or otherwise) between the persons enumerated in Item 2, and any other
person, with respect to any securities of the Issuer, 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 of profits,
division of profits or loss, or the giving or withholding of proxies.
Item 7. Material to be Filed as Exhibits.
Exhibit 1: The Stock Purchase Agreement dated as of October 12, 1999
between the Issuer and Pacific Century Cyberworks Limited, a Hong Kong
corporation of limited liability which is the indirect parent corporation of
the Buyer. Incorporated herein by reference to Exhibit 10.1 filed with the
Issuer's Current Report on Form 8-K for the quarter ended September 30, 1999.
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SIGNATURES
After reasonable inquiry and to the best knowledge and belief of the
undersigned, the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Date: December 17, 1999
CYBER NET TECHNOLOGIES LIMITED
By: /s/ Alexander Anthony Arena
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Name: Alexander Anthony Arena
Title: Director
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SCHEDULE A
DIRECTORS AND EXECUTIVE OFFICERS OF CYBER NET TECHNOLOGIES LIMITED
The name, business address, title, present principal occupation or
employment of each of the directors and executive officers of Cyber Net
Technologies Limited (the "Buyer") are set forth below. If no business address
is given the director's or officer's business address is 38th Floor, Citibank
Tower, Citibank Plaza, 3 Garden Road, Central, Hong Kong. Unless otherwise
indicated, each occupation set forth opposite an individual's name refers to
the Buyer. Unless otherwise indicated below, all of the persons listed below
are citizens of Hong Kong.
Present Principal Occupation
Name and Business Address Including Name and Address of Employer
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Directors
Yuen Tin Fan........................... Director
Alexander Anthony Arena................ Director (citizen of Australia)
Peter Anthony Allen ................... Director (citizen of the United Kingdom)
Chung Cho Yee, Mico ................... Director
Present Principal Occupation
Name and Business Address Including Name and Address of Employer
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Executive Officers
(Who Are Not Directors)
Chu Mee Lai, Helen..................... Company Secretary
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