SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
February 13, 2003
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(Date of report)
PROTOSOURCE CORPORATION
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(Exact Name of Registrant as Specified in Charter)
CALIFORNIA 33-86242 77-0190772
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(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
2300 Tulare Street, Suite 210
Fresno, California 93721
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(Address of Principal Executive Offices)
(559)-490-8600
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(Registrant's telephone number, including area code)
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(Former name or former address, if changed since last report)
ITEM 2. Acquisition or Disposition of Assets
On February 13, 2003, Protosource Corporation, a California corporation
("Protosource" or the "Company") announced an agreement and plan of merger to
acquire all of the outstanding capital stock of P2i Newpaper, Inc., a Delaware
corporation ("P2i Newspaper") and a wholly owned subsidiary of P2i, Inc., a
Pennsylvania corporation ("P2i"), in exchange for the issuance of up to
19,383,531 shares of Protosource common stock (the "Agreement"). The 19,383,531
shares will be reduced by the number of shares equal to the total fees incurred
to audit the financial statements of P2i or P2i Newspaper, divided by $0.50 (the
"Adjusted Shares"). The P2i Newspaper shareholders shall receive 10 shares of
Protosource common stock for each $1.00 of gross income (as defined in the
Agreement) earned by P2i Newspaper during calendar years 2003-2005, calculated
quarterly, up to the total number of Adjusted Shares. The Adjusted Shares shall
be subject to a three-year lock-up, which may be released upon the stock price
and volume reaching established thresholds. The closing of this Agreement is
subject to approval by the shareholders of Protosource and P2i Newspaper, and
other customary terms and conditions.
After the acquisition, P2i Newspaper will become a wholly owned subsidiary
of the Company. P2i Newspaper is a leader in the conversion of previously
created print advertising into interactive web products for newspaper, magazine
and mail order/retail catalog advertising. Clients include newspapers from the
Gannett, Tribune and McClatchy Newspaper groups, and the retailers Avon,
Nordstrom and Neiman Marcus. The company is headquartered in Bethlehem, PA, has
offices in New York and London, and a data conversion facility in Kuala Lumpur,
Malaysia. Upon closing of the transaction, Protosource will appoint Thomas
Butera, President of P2i, as a director of Protosource, and Mr. Butera, together
with Peter Wardle, President of Protosource, shall have the right to appoint
three members to the board of directors of Protosource.
ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired.
Financial Statements of Business Acquired to be filed by amendment.
(b) Pro Forma Financial Information.
Pro Forma Financial Information to be filed by amendment.
(c) Exhibits
Number Description
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10.1 Form of Agreement and Plan of Merger, dated as of February 13,
2003, by and among Protosouce Corporation, Protosource
Acquisition LLC, P2i, Inc. and P2i Newspaper, Inc.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the Undersigned, thereunto duly authorized.
PROTOSOURCE CORPORATION
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(Registrant)
Date: February 24, 2003 /s/Peter Wardle
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Peter Wardle,
Chief Executive Officer