FONIX CORP rpts change in assets, financial statements & exhibits.
Excerpted from 8-K filed on 09/16 by FONIX CORP:
FONIX CORP rpts change in assets, financial statements & exhibits.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On September 1, 1999, Fonix Corporation, a Delaware corporation, (the
"Company" or "Fonix") closed the sale (the "Sale") of the operations and a
significant portion of the assets of its HealthCare Solutions Group (the "HSG")
to Lernout & Hauspie Speech Products N.V., a Belgian corporation ("L&H") with
its principal place of business in Ieper, Belgium.
The Board of Directors recommended the Sale to the officers of the
Company, and the officers entered into an Asset Purchase Agreement (the
"Agreement") on May 19, 1999. Pursuant to the Agreement, L&H purchased the HSG
for $28,000,000 (the "Purchase Price"). Of the Purchase Price, $24,000,000 was
payable in cash at the closing of the Sale. Of that amount, $5,000,000 was to be
deposited into escrow for 18 months for potential indemnification of L&H by the
Company against certain matters including, but not limited to, breaches of
representations, warranties, covenants, and agreements made by the Company in
the Agreement. In addition, $4,000,000 of the Purchase Price may be paid over
two years as follows: (i) if L&H generates gross revenues of at least $9,000,000
from sales or licensing of PowerScribe (R) ("PowerScribe") branded products and
services, together with products and services that include or incorporate
PowerScribe technology (the "PowerScribe Products"), L&H will pay an additional
$2,000,000 to the Company; and (ii) if L&H generates at least $20,000,000 of
gross revenues from the sales or licensing of the PowerScribe Products during
the second consecutive year it sells or licenses the PowerScribe Products, L&H
will pay an additional $2,000,000 to the Company. The Purchase Price was
negotiated between the Company and L&H based on a discounted earnings multiple
of the three-year projected operations of the HSG.
Subsequent to the execution of the Agreement, the Company and L&H
agreed that the escrow amount would be reduced from $5,000,000 to $2,500,000.
(End of item excerpt.)
Item 7. Financial Statements and Exhibits.
(b) Pro Forma Financial Information.
It is impracticable for the Company to provide the required pro forma
financial information as required by Item 7(b)of Form 8-K at this time. The
Company undertakes that it will file the required pro forma financial
information within the time period allowed by Form 8-K.
(c) Exhibits. The following are filed as exhibits to this Current
Report:
Exhibit
No. Description
(10)(a) Asset Purchase Agreement - Acquisition of
Certain Assets of Fonix Corporaion and
Fonix/ASI Corporation by Lernout & Hauspie
Speech Products N.V., dated as of May 19,
1999.
(10)(b) Escrow Agreement, dated as of September 1, 1999.
(10)(c) Technology Option Agreement, dated as of May 19,
1999.
(10)(d) Assignment and Assumption Agreement, dated as of
September 1, 1999.
(10)(e) License Agreement by and between Fonix/ASI
Corporation and Lernout & Hauspie Speech
Products N.V., dated as of May 19, 1999.
(10)(f) Loan Agreement, dated as of April 22, 1999.
(10)(g) Amendment to Loan Agreement, dated as of May 12,
1999.
(10)(h) Second Amendment to Loan Agreement, dated as of
May 19, 1999.
(10)(i) Loan Agreement, dated as of May 19, 1999.
(10)(j) First Amendment to Loan Agreement, dated as of
August 12, 1999.
(10)(k) Agreement, dated as of July 31, 1999.
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