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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date Report (Date of earliest event reported): April 22, 1998
SOLIGEN TECHNOLOGIES, INC.
(exact name or registrant as specified in its charter)
Wyoming 1-12694 95-4440838
(State or other jurisdiction (Commission File Number) (I.R.S. Employer Identification
incorporation or organization) No.)
19408 Londelius St., Northridge, California 91423
(Address of principal executive offices)
Registrant's telephone number, including area code: 818-718-1221
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SOLIGEN TECHNOLOGIES
FORM 8-K
ITEM 5. OTHER EVENTS.
(a) Private Placement Financing. On April 24, 1998, Soligen Technologies, Inc.
(the "Company"), entered into a Series A Convertible Preferred Stock Purchase
Agreement (the "Stock Purchase Agreement") providing for the private placement
of up to 3,000 shares of a newly authorized series of preferred stock ("Series A
Preferred"). The Company has received gross proceeds of $800,000 from the sale
of 1,600 shares of Series A Preferred to two private investors pursuant to the
Stock Purchase Agreement. The Stock Purchase Agreement permits additional sales
of Series A Preferred to be completed until May 31, 1998. As of the date of this
report, the Company has not received a commitment from any investor to purchase
additional shares pursuant to the Stock Purchase Agreement.
At a special stockholders meeting held on April 20, 1998, the Company's
stockholders approved an amendment to the Company's Articles of Incorporation
authorizing the issuance of up to 10,000,000 shares of preferred stock. This
amendment authorizes the Company's Board of Directors to issue preferred stock
in one or more series on terms approved by the Board of Directors without the
necessity of further action or approval by the stockholders. Pursuant to this
authority, the Company's Board of Directors has authorized the issuance of up to
5,000 shares of Series A Preferred Stock having rights and preferences as set
forth in a Statement of Rights and Preferences (the "Statement") filed with the
Secretary of State of Wyoming on April 24, 1998. A copy of the Statement is
attached as an exhibit to this report. The following is a summary of certain
terms of the Series A Preferred, and reference is made to the Statement for a
complete description of the rights and preferences of the Series A Preferred.
The Series A Preferred is not entitled to any fixed or guaranteed dividend. Upon
a liquidation of the Company, the Series A Preferred is entitled to receive a
distribution of $500 per share in preference to any distribution to holders of
common stock. The approval of the holders of at least two-thirds of the
outstanding shares of Series A Preferred is required for certain significant
corporate actions, including mergers, sales of substantially all of the
Company's assets, or the issuance of shares having rights and preferences senior
to those of the Series A Preferred.
Each share of Series A Preferred is initially convertible into 500 shares of the
Company's Common Stock, subject to adjustment for recapitalizations, stock
splits and similar events. During the first year after issuance, the Series A
Preferred conversion ratio is subject to adjustment pursuant to an "economic
antidilution" provision which causes the conversion ratio to adjust upward in
the event the Company issues shares of common stock (or securities convertible
into or exercisable for common stock) at a price below $0.50 per share of Common
Stock. Beginning one year after the date of issuance, the conversion ratio of
the Series A Preferred is subject to downward adjustment in the event the
average trading price of the Company's Common Stock is greater than $0.50 per
share. The conversion ratio of the Series A Preferred increases by 12% effective
one year after the date of issuance, and thereafter increases at a rate of 12%
per annum. The Series A Preferred automatically converts into common stock in
the event the average trading price of the Company's common stock over 20
consecutive trading days is greater than $1.00 per share and the cumulative
trading volume on the American Stock Exchange during such 20 day period is at
least 300,000 shares. If the Company's common stock is trading on NASDAQ during
such period, the cumulative trading volume must be at least 450,000 shares. The
Series A Preferred also automatically converts
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into common stock in the event the Company completes an underwritten public
offering in which the Company receives gross proceeds of at least $10,000,000
and at a per share price of at least $1.00 per share (subject to adjustment for
stock splits, recapitalizations, etc.)
Purchasers of Series A Preferred are also parties to an Investor Rights
Agreement which grants certain rights of first offer and "piggyback"
registration rights. The holders of Series A Preferred, voting as a separate
class, are entitled to elect one member of the Company's Board of Directors.
(b) Amendment to Escrow Agreement. Soligen Technologies, Inc. (the "Company")
has entered into an amendment (the "Amendment") to the Escrow Agreement, dated
November 2, 1992 (the "Escrow Agreement"), pursuant to which certain shares
issued in connection with an acquisition transaction are held in escrow. A copy
of the Amendment is attached as an exhibit to this report.
As originally executed, the terms and conditions of the Escrow Agreement were
prescribed by the policies of the British Columbia Securities Commission and
were issued under its Local Policy 3-07. The escrow shares are held by the
Company's registrar and transfer agent pursuant to the terms of the Escrow
Agreement. Prior to the Amendment, the Escrow Agreement provided for the release
of one escrow share for each $0.41 Cdn. in net "cash flow" (as defined in the
Escrow Agreement) earned by the Company during the period beginning November 1,
1993 and ending October 31, 1998. The Escrow Agreement further provided that, if
the Company earned net "cumulative cash flow" (as defined in the Escrow
Agreement) of approximately Cdn. $4,000,000 or U.S. $3,050,000 during the five
year earn-out period, all of the escrow shares would be "earned out" and thereby
released from escrow. Any shares not released from escrow at the end of the five
year earn out period would have been canceled.
The Amendment, which was approved at the 1995 Annual Meeting of the Company's
stockholders, provides that the "earn-out" period will be extended for an
additional five years, and that all shares not previously released from escrow
will be released ten years after the date of issuance. In March 1998 the Company
received approval of the amendment from the British Columbia Securities
Commission, and the amendment has now been executed and become effective.
ITEM 7. EXHIBITS.
The following exhibits are filed herewith and this list constitutes the exhibit
index.
EXHIBIT NO. DOCUMENT DESCRIPTION
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4.1 Articles of Amendment, as filed with Wyoming Secretary of State
on April 22, 1998, amending Section 9 of Articles of
Incorporation
4.2 Statement of Rights and Preferences of Series A Preferred Stock
4.3 Series A Convertible Preferred Stock Purchase Agreement, dated
April 24, 1998(excluding exhibits and schedules)
4.4 Investor Rights Agreement, dated April 24, 1998
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EXHIBIT NO. DOCUMENT DESCRIPTION
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4.5 First Amendment to Escrow Agreement
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
April 30, 1998.
SOLIGEN TECHNOLOGIES, INC.
By: _________________________________________
Yehoram Uziel, President, Chief
Executive Officer and Chairman of the
Board of Directors