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Technology Stocks : I-Storm, Inc. (ISTM) -- Ignore unavailable to you. Want to Upgrade?

To: mod who wrote (6)	1/19/2000 4:55:00 PM
From: mod	Read Replies (1) \| Respond to of 17

More details on the Computer Associates deal from an SEC filing by ISTM: ITEM 5. OTHER EVENTS I-STORM, INC. AND COMPUTER ASSOCIATES INTERNATIONAL, INC. ANNOUNCE STRATEGIC ALLIANCE IN ENTERPRISE SYSTEM MANAGEMENT AND ONLINE STOREFRONT OPERATIONS I-Storm, Inc. ("I-Storm" or the "Company") and Computer Associates International, Inc. ("CA") have announced a strategic alliance designed to leverage the strengths of I-Storm's e-commerce solution expertise and CA's Global Professional Services Group to finance, build, and operate eBusiness storefronts for major corporations and consumer brands. Under the terms of the transaction, CA has made an equity investment in I-Storm, and CA will also provide I-Storm with enterprise software development and systems integration services. I-Storm and CA will assemble a joint business development team focused on deploying eBusiness solutions in the business-to-consumer and business-to-business spaces. CA will also acquire one of five seats on I-Storm's Board of Directors. In accordance with the I-Storm Series D Stock Purchase Agreement, CA has initially purchased 40,817 newly issued shares of I-Storm Series D Cumulative Convertible Preferred Stock ("Series D Preferred Stock") at a price of $12.25 per share for a cash investment of $500,000. CA, an accredited investor, made the purchase pursuant to the provisions of Regulation D of the Securities and Exchange. The Series D Preferred Stock is subject to certain demand and piggy-back registration rights as set forth in the I-Storm Series D Preferred Stock Registration Rights Agreement. The Series D Preferred Stock is entitled to receive a quarterly dividend of $0.28 (9% per annum) on February 15, May 15, August 15 and November 15, of each year, payable in cash, or at the option of the Company, in Series D Preferred Stock of the Company, when and as declared by the Board of Directors. The right of the Series D Preferred Stock to payment of either cash or Series D Preferred stock dividends is subordinate to the right to cash or stock dividend payments of the Series A Preferred Stock, and then to the Series B Preferred Stock; and is PARI PASSU with the right of the Series C Preferred Stock to cash or stock dividend payments. The Series D Preferred Stock is convertible into shares of the Company's Common Stock: (i) at the option of the holder, any time after the purchase closing date, (ii) and by the Company four years after the purchase closing date, into such number of shares of the Company's Common Stock as shall equal $12.25 divided by the lower of (i) $3.50, or (ii) the closing bid price for any five consecutive trading days during the period commencing eleven months after the purchase closing and ending one month thereafter (the "Conversion Price"), however, in no event shall the Conversion Price be reduced below $2.80. The Conversion Price is also subject to further adjustment to prevent dilution. CA also has the option to make up to three additional purchases of Series D Preferred Stock in $500,000 increments, upon I-Storm's and CA's mutual approval of three e-commerce partnership agreements. CA's total proposed investment in I-Storm is a maximum of 163,268 shares of Series D Preferred Stock for an aggregate purchase price of $2,000,000. I-Storm and CA have also entered into a Professional Services Agreement for CA to provide a minimum of $800,000 of professional services during the period commencing August 1, 1999 through December 31, 2001, and a License Agreement to provide CA software products during the same time period. CA has also agreed to provide I-Storm with a business development fund to be used for marketing expenditures for a joint partnership program by CA and I-Storm. Terms of this fund are being negotiated.