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): September 13, 2002
ION NETWORKS, INC.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 000-13117 22-2413505
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(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
1551 South Washington Avenue
Piscataway, New Jersey 08854
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(Address of Principal Executive Offices) (Zip Code)
(Registrant's telephone number, including area code): (732) 529-0100
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Item 5. Other Events.
On September 13, 2002, ION Networks, Inc. (the "Company"), received
equity financing in the amount of $300,303.00 (the "Preferred Stock Financing")
for the issuance of 166,835 unregistered shares of the Company's Series A
Preferred Stock (the "Preferred Stock") at $1.80 per share. Each share of
Preferred Stock is convertible into 10 shares of the Company's Common Stock at
the conversion price of $0.18, which was the last closing bid price of the
Company's Common Stock on Friday September 13, 2002. The Preferred Stock is
non-voting, has a standard liquidation preference equal to its purchase price,
and does not pay dividends. Proceeds of the Preferred Stock Financing will be
used for working capital and general corporate purposes. All of the shares of
Preferred Stock were purchased by directors and management of the Company. The
purpose of the Preferred Stock Financing is to enable the Company to comply with
the Nasdaq SmallCap Market's initial listing requirement of a minimum of
$5,000,000 of stockholders' equity so that the Company may be eligible for an
additional 180-day grace period to attempt to regain compliance with the $1.00
minimum bid price requirement of the Nasdaq SmallCap Market.
Item 9. Regulation FD Disclosure.
Below is the Company's pro forma balance sheet as of June 30, 2002
adjusted to reflect the funds received by the Company as a result of the
Preferred Stock Financing.
[Pro Forma Balance Sheet follows.]
ION Networks, Inc. and Subsidiaries
Pro Forma Condensed Consolidated Balance Sheet
(Unaudited)
The following pro forma condensed consolidated balance sheet at June
30, 2002 has been presented as if the Preferred Stock Financing described in
Note (1) below had occurred on June 30, 2002. This pro forma condensed
consolidated balance sheet does not purport to represent what the Company's
financial condition or results of operations would actually have been if the
Preferred Stock Financing had in fact occurred on June 30, 2002.
PROFORMA
JUNE 30, 2002 ADJUSTMENTS JUNE 30, 2002
(HISTORICAL) (1)(2) (PRO FORMA)
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Assets
Current assets:
Cash and cash equivalents ................................................ $ 2,472,024 $ 300,303 $ 2,772,327
Accounts receivable, net of allowance for doubtful accounts of $206,137
and $149,999 respectively ................................................ 823,262 823,262
Other receivables ........................................................ 12,900 12,900
Inventory, net ........................................................... 1,534,983 1,534,983
Prepaid expenses and other current assets ................................ 185,961 185,961
Related party notes receivable ........................................... 83,657 83,657
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Total current assets ................................................. 5,112,787 300,303 5,413,090
Restricted cash .......................................................... 125,700 125,700
Property and equipment at cost, net of accumulated depreciation of
$2,880,800 ............................................................... 672,070 672,070
Capitalized software, less accumulated amortization of $3,583,212 ........ 889,674 889,674
Other assets ............................................................. 64,968 64,968
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Total assets ......................................................... $ 6,865,199 $ 300,303 $ 7,165,502
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Liabilities and stockholders' equity
Current liabilities:
Current portion of capital leases ........................................ $ 74,426 $ 74,426
Current portion of long-term debt ........................................ 12,238 12,238
Accounts payable ......................................................... 839,372 839,372
Accrued expenses ......................................................... 362,186 $ 15,000 377,186
Accrued payroll and related liabilities .................................. 366,218 366,218
Deferred income .......................................................... 137,625 137,625
Sales tax payable ........................................................ 137,570 137,570
Other current liabilities ................................................ 84,245 84,245
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Total current liabilities ............................................ 2,013,880 15,000 2,028,880
Long-term portion of capital leases ...................................... 126,869 126,869
Long-term debt, net of current portion ................................... 5,241 5,241
Commitments and contingencies
Stockholders' equity:
Preferred stock, par value $.001 per share; authorized
1,000,000 shares, none issued (historical)
Series A Preferred Stock, par value $.001 per share; no shares
authorized or issued (historical); 200,000 shares designated
and 166,835 shares issued and outstanding (pro forma) -- 167 167
Common stock, par value $.001 per share; authorized 50,000,000 shares,
25,138,001 shares issued and outstanding at June 30, 2002 ............ 25,138 25,138
Additional paid-in capital ........................................... 44,381,454 285,136 44,666,590
Notes receivable from officers ....................................... (549,914) (549,914)
Accumulated deficit .................................................. (39,146,058) (39,146,058)
Accumulated other comprehensive income ............................... 8,589 8,589
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Total stockholders' equity ............................................... 4,719,209 285,303 5,004,512
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Total liabilities and stockholders' equity ............................... $ 6,865,199 $ 300,303 $ 7,165,502
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(1) Based on the issuance on September 16, 2002 of 166,835 shares of Series A
Preferred Stock at a price of $1.80 per share.
(2) Estimated expenses of $15,000 related to the Preferred Stock Financing.
The pro forma financial information in this Current Report on Form 8-K
is furnished pursuant to Item 9 and shall not be deemed to be "filed" for the
purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or
otherwise subject to the liabilities of that section.
Exhibits.
Exhibit No. Description
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10.29 Purchase Agreement dated September 13, 2002 by and among the
Company and the Investors identified therein.
10.30 Registration Rights Agreement dated September 13, 2002 by and
among the Company and the Investors identified therein.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: September 16, 2002 ION NETWORKS, INC.
By: /s/ Ted Kaminer
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Ted Kaminer
Chief Financial Officer
(Principal Financial Officer and
Principal Accounting Officer)