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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 24, 2007
SEMOTUS SOLUTIONS, INC.
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(Exact Name of Registrant as Specified in its Charter)
NEVADA 0-21069 36-3574355
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
718 University Ave., Suite 202 Los Gatos, CA 95032
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(Address of Principal Executive Offices) (Zip Code)
(408) 399-6120
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(Registrant's Telephone Number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CRF 240.14d-2(b))
[ ] Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
In this discussion, unless otherwise specified, all references to "we", "us" and
"our" mean Semotus Solutions, Inc.
All dollar amounts refer to US dollars unless otherwise indicated.
We have entered into a Software License Agreement and Stock Issuance and
Registration Rights Agreement on July 23, 2007 with Innofone.com Incorporated
("Innofone"), relating to a royalty free license of our HipLinkXS and Clickmarks
software applications (the "Agreement"). The consideration for this software
license consists of $3.75 million worth of Innofone's restricted common stock at
a price we calculate as $0.19 per share, with demand and piggyback registration
rights. Additionally, there is a post-closing purchase price adjustment on the
Innofone stock, should the stock fall below $3.75 million in aggregate value.
However, the price adjustment is effective only upon Innofone moving forward
with certain future transactions with us, as outlined below. Furthermore,
Innofone has a right to buy back its common stock in cash for $3,750,000, for a
period of one year, should the future transactions not be completed.
We have granted Innofone an option to buy certain assets, including the
Hiplinkxs and Clickmarks software application products, the complete terms and
conditions of which have not yet been fully defined or agreed upon ("Asset
Sale"). At a minimum, this Asset Sale would require a payment by Innofone of
$250,000 and a convertible note due from Innofone in favor of us for $500,000.
Additionally, Innofone must have at least $1,000,000 in operating cash prior to
the close of the sale. Such a transaction would also require approval by each
Company's Boards of Directors, the American Stock Exchange and Semotus
shareholders. Innofone has 90 days to complete the asset purchase.
If the Asset Sale transaction is effectuated, Innofone will then have a right of
first refusal to merge with us, the complete terms and conditions of which have
not yet been fully defined or agreed upon. This right of first refusal will last
for a period of 90 days. To effect such a merger, Innofone must have a net
shareholder value of at least $4,000,000 and operating cash of at least
$2,000,000 in order to qualify. In addition, the merger must be approved by the
Board of Directors of both companies, the American Stock Exchange and our
shareholders.
The foregoing description of the Agreement is qualified in its entirety by
reference to the full text of the Agreement, which is attached hereto as
Exhibits 2.1 and 2.2, incorporated herein by reference.
On July 24, 2007, we issued a press release with respect to this License
Agreement. A copy of the press release is attached hereto as Exhibit 99.1 and is
incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Business Acquired
Not applicable.
(b) Pro Forma Financial Information
Not applicable.
(c) Exhibits. The following exhibits are filed with this report:
Exhibit Number Description
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2.1 Software License Agreement by and among Semotus
Solutions, Inc. and Innofone.com Incorporated dated July
23, 2007.
2.2 Stock Issuance and Registration Rights Agreement by and
among Semotus Solutions, Inc. and Innofone.com
Incorporated dated July 23, 2007.
99.1 Press Release of Semotus Solutions, Inc. issued on July
24, 2007.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, hereunto duly authorized.
SEMOTUS SOLUTIONS, INC.
Date: July 26, 2007 By: /s/ Anthony N. LaPine
Anthony N. LaPine,
Chief Executive Officer