As filed with the Securities and Exchange Commission on January 29, 2004
REGISTRATION NO. 333-
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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RAMP CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 84-112331
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(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
THE GRAYBAR BUILDING
420 LEXINGTON AVENUE, SUITE 1830
NEW YORK, NEW YORK 10170
(212) 697-2509
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(Address, including zip code, and telephone number,
Including area code, of registrant's principal executive offices)
DARRYL R. COHEN
THE GRAYBAR BUILDING
420 LEXINGTON AVENUE, SUITE 1830
NEW YORK, NEW YORK 10170
(212) 697-2509
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(Name, address, including zip code, and telephone number,
Including area code, of agent for service)
Copy to:
Martin Eric Weisberg, Esq.
Jenkens & Gilchrist Parker Chapin LLP
The Chrysler Building
405 Lexington Avenue
New York, New York 10174
(212) 704-6000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: As soon as
practicable after the effective date of this Registration Statement.
If the only securities on this Form are being offered pursuant to
dividend or interest reinvestment plans, please check the following box. |_|
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_| __________
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. |_| __________
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. |_|
CALCULATION OF REGISTRATION FEE
PROPOSED
PROPOSED MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS AMOUNT TO OFFERING PRICE AGGREGATE REGISTRATION
OF SECURITIES TO BE REGISTERED BE REGISTERED(1) PER SHARE OFFERING PRICE FEE(8)
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Common Stock, $.001 par value per share... 9,336,000(2)(3) $ 0.79(4)$ 7,375,440.00 $ 934.47
Common Stock, $.001 par value per share... 3,916,981(5) $ 0.79(4)$ 3,094,415.00 $ 392.06
Common Stock, $.001 par value per share... 3,173,968 $ 0.79(7)$ 2,507,434.72 $ 317.69
Common Stock, $.001 par value per share... 750,000(2)(6) $ 0.79(7)$ 592,500.00 $ 75.07
Common Stock, $.001 par value per share... 1,695,250(2)(6) $ 0.79(7)$ 1,339,247.50 $ 169.68
Total Registration Fee ................... $ 1,888.97
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(1) Represents the shares of common stock being registered for resale by
the selling stockholders and the number of shares of common stock
issuable upon conversion of Series A Convertible Preferred Stock and
the exercise of warrants to purchase shares of our common stock by the
selling stockholders.
(2) Pursuant to Rule 416 of the Securities Act of 1933, as amended (the
"Securities Act"), the shares of common stock offered hereby also
include such presently indeterminate number of shares of common stock
as shall be issued by us to the selling stockholders upon adjustment
under anti-dilution provisions covering the additional issuance of
shares by Ramp resulting from stock splits, stock dividends or similar
transactions.
(3) Represents 120% of the number of shares of common stock issuable upon
conversion of our Series A Convertible Preferred Stock.
(4) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) and (g) of the Securities Act; based on the
average ($0.79) of the closing bid ($0.78) and asked ($0.80) price on
the American Stock Exchange on January 26, 2004.
(5) Represents shares of our common stock.
(6) Represents the number of shares of common stock issuable upon the
exercise of warrants to purchase shares of our common stock.
(7) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(g) of the Securities Act, based on the higher of
(a) the exercise price of the warrants or (b) the offering price of
securities of the same class included in this registration statement.
(8) Calculated pursuant to Section 6(b) of the Securities Act based upon
Proposed Maximum Aggregate Offering Price multiplied by .0001267.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY
DETERMINE.
The information in this prospectus is not complete and may be changed.
No dealer, salesman or other person has been authorized to give any information
or to make any representation not contained in or incorporated by reference in
this prospectus and, if given or made, such information or representation must
not be relied upon as having been authorized by us, the selling stockholders or
any other person. This prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any of the securities offered hereby in any
jurisdiction to any person to whom it is unlawful to make such an offer in such
jurisdiction. Neither the delivery of this prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that the
information herein is correct as of any time subsequent to the date hereof or
that there has been no change in our affairs since such date.
SUBJECT TO COMPLETION, DATED JANUARY 29, 2004.
PROSPECTUS
RAMP CORPORATION
18,872,199 SHARES OF COMMON STOCK
This prospectus relates to the sale by the selling stockholders
identified in this prospectus of up to an aggregate of 18,872,199 shares of our
common stock, including:
o 9,336,000 shares issuable upon conversion of our Series A
Convertible Preferred Stock at an initial conversion price of $0.40
cents per share;
o 3,916,981 shares of our common stock;
o 750,000 shares issuable upon the exercise of warrants with an
initial exercise price of $0.70 cents per share;
o 3,173,968 shares issuable upon the exercise of warrants with an
initial exercise price of $0.61 cents per share; and
o 1,695,250 shares issuable upon the exercise of warrants with an
initial exercise price of $0.30 cents per share.
The conversion price of our Series A Convertible Preferred Stock and
the exercise prices of the warrants are subject to adjustment under certain
circumstances. Please see the sections of this prospectus titled "Description of
the Transactions", "Plan of Distribution" and "Description of Our Securities"
for more information about the terms and conditions of our Series A Convertible
Preferred Stock and warrants.
We will not receive any of the proceeds from the sale of these shares
by the selling stockholders. However, we will receive the proceeds from any
exercise of warrants to purchase shares to be sold hereunder. See "Use of
Proceeds".
We have agreed to pay the expenses in connection with the registration
of these shares.
Our common stock is traded on the American Stock Exchange under the
symbol "RCO". On January 26, 2004, the closing price of our common stock was
reported as $0.80 cents per share.
INVESTING IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 5 OF THIS PROSPECTUS FOR CERTAIN RISKS THAT SHOULD BE
CONSIDERED BY PROSPECTIVE PURCHASERS OF THE SECURITIES OFFERED HEREBY.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS JANUARY __, 2004.
TABLE OF CONTENTS
PROSPECTUS SUMMARY.............................................................3
RISK FACTORS...................................................................4
FORWARD-LOOKING STATEMENTS.....................................................9
USE OF PROCEEDS................................................................9
DESCRIPTION OF THE TRANSACTIONS...............................................10
SELLING STOCKHOLDERS..........................................................12
DESCRIPTION OF SECURITIES.....................................................14
PLAN OF DISTRIBUTION..........................................................19
INDEMNIFICATION OF OFFICERS AND DIRECTORS.....................................20
WHERE YOU CAN FIND MORE INFORMATION ABOUT US..................................21
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE.............................21
LEGAL MATTERS.................................................................22
EXPERTS.......................................................................22
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PROSPECTUS SUMMARY
The following summary highlights aspects of the offering and the
information incorporated by reference in this prospectus. This prospectus does
not contain all of the information that you should consider before making an
investment decision. You should read this entire prospectus carefully, including
the "Risk Factors" section and the financial statements, related notes and the
other more detailed information appearing elsewhere or incorporated by reference
in this prospectus. Unless otherwise indicated, "we", "us", "our" and similar
terms, as well as references to the "Company" and "Ramp", refer to Ramp
Corporation and its subsidiaries and not to the selling securityholders. All
industry statistics incorporated by reference in this prospectus were obtained
from data prepared or provided by recognized industry sources.
RAMP CORPORATION
Ramp Corporation (formerly known as Medix Resources, Inc.), through its
wholly-owned HealthRamp subsidiary, provides Internet based communication, data
integration, and transaction processing designed to provide access to safer and
better healthcare. Ramp's products enable communication of high value-added
healthcare information among physician offices, hospitals, health management
organizations, and health insurance companies.
We have limited revenues from current operations and are funding the
development and deployment of our products through the sales of our securities.
See "Risk Factors".
Because of our continuing losses, and the lack of certain sources of
capital to fund our development of connectivity products, our independent
accountants included a "going concern" uncertainty in their audit report on our
audited financial statements for the year ended December 31, 2002. The "going
concern" uncertainty signifies that significant questions exist about our
ability to continue our business. See "Risk Factors".
Our principal executive office is located at 420 Lexington Avenue,
Suite 1830, New York, New York 10170, and our telephone number is (212)
697-2509.
THE OFFERING
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Common stock offered by selling
security holders 18,872,199
Use of Proceeds We will not receive any proceeds from
the sale of shares in this offering.
We may receive up to $2,969,695 upon
exercise of the warrants.
American Stock Exchange Symbol RCO
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RISK FACTORS
An investment in our common stock involves a high degree of risk. You
should carefully consider the following risk factors and other information in
this prospectus before investing in our common stock. The trading price of our
common stock could decline due to any of these risks, and you may lose all or
part of your investment.
WE HAVE INCURRED AND REPORTED NET LOSSES. The Company has reported net
losses of ($9,014,000), ($10,636,000) and ($5,415,000) for the years ended
December 31, 2002, 2001, and 2000, respectively, and a net loss of ($11,633,000)
for the nine months ended September 30, 2003. At September 30, 2003, we had an
accumulated deficit of ($53,573,000). These losses and negative operating cash
flow have caused our accountants to include a "going concern" qualification in
their report in connection with their audits of our financial statements for the
years ended December 31, 2001 and 2002, respectively.
WE RELY ON INVESTMENTS AND FINANCINGS TO PROVIDE WORKING CAPITAL. While
we believe that we can continue to sell our securities to raise the cash needed
to continue operating until cash flow from operations can support our business,
there can be no assurance that this will occur. There can be no assurance that
additional investments in our securities or other debt or equity financings will
be available to us on favorable terms, or at all, to adequately support the
development and deployment of our technology. Moreover, failure to obtain such
capital on a timely basis could result in lost business opportunities. We
currently have 400,000,000 shares of common stock authorized for issuance under
our restated certificate of incorporation, and as of December 31, 2003, had
144,305,822 outstanding shares of common stock and 51,041,345 shares of common
stock reserved for issuance under options, warrants and shares of our
convertible preferred stock and convertible debentures outstanding on such date.
THE SUCCESS OF THE DEVELOPMENT, DISTRIBUTION AND DEPLOYMENT OF OUR
TECHNOLOGY IS DEPENDENT TO A SIGNIFICANT DEGREE ON OUR KEY MANAGEMENT AND
TECHNICAL PERSONNEL. We believe that our success will also depend upon our
ability to attract, motivate and retain highly skilled, managerial, sales and
marketing, and technical personnel, including software programmers and systems
architects skilled in the computer languages in which our technology operates.
Competition for such personnel in the software and information services
industries is intense. The loss of key personnel, or the inability to hire or
retain qualified personnel, could have a material adverse effect on our results
of operations, financial condition or business.
WE EXPECT TO CONTINUE TO EXPERIENCE LOSSES, UNTIL SUCH TIME AS OUR
TECHNOLOGY CAN BE SUCCESSFULLY DEPLOYED AND PRODUCES REVENUE. The continuing
development, marketing and deployment of our technology will depend upon our
ability to obtain additional financing. Our technology is in the development
stage and has generated limited recurring revenues to date. We are funding our
operations now through the sale of our securities.
WE MAY NOT BE ABLE TO RETAIN OUR LISTING ON THE AMERICAN STOCK
EXCHANGE. The American Stock Exchange has not notified us of any listing
concerns. However, should our common stock trade at a low price for a
substantial period of time or should the American Stock Exchange consider our
circumstances for continued listing in a negative light, we may not be able to
retain our listing. The American Stock Exchange has certain listing requirements
in order for the Company to continue to have its common stock traded on this
exchange. Although the American Stock Exchange does not identify a specific
minimum price per share that the Company's stock must trade above or any other
rigid standards compelling delisting, the Company may risk delisting if its
common stock trades at a low price per share for a substantial period of time or
if it fails to meet the financial condition, result of operations, market
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capitalization or other financial or non-financial standards considered by the
American Stock Exchange. Trading in our common stock after a delisting, if any,
would likely be conducted in the over-the-counter markets in the so-called "pink
sheets" or on the National Association of Securities Dealers' Electronic
Bulletin Board. As a consequence of a delisting our shareholders would find it
more difficult to dispose of, or to obtain accurate quotations as to the market
value of, our common stock and our common stock would become substantially less
attractive as collateral for margin and purpose loans, for investment by
financial institutions under their internal policies or state investment laws or
as consideration in future capital raising transactions.
ALTHOUGH WE HAVE HAD OPERATIONS SINCE 1988, BECAUSE OF OUR MOVE AWAY
FROM TEMPORARY HEALTHCARE STAFFING TO PROVIDE HEALTHCARE CONNECTIVITY SOLUTIONS
AT THE POINT OF CARE, WE HAVE A RELATIVELY SHORT OPERATING HISTORY IN THE
HEALTHCARE CONNECTIVITY SOLUTIONS BUSINESS AND LIMITED FINANCIAL DATA TO
EVALUATE OUR BUSINESS AND PROSPECTS. In addition, our business model is likely
to continue to evolve as we attempt to develop our product offerings and enter
new markets. As a result, our potential for future profitability must be
considered in light of the risks, uncertainties, expenses and difficulties
frequently encountered by companies that are attempting to move into new markets
and continuing to innovate with new and unproven technologies. We are still in
the process of gaining experience in marketing physician connectivity products,
providing support services, evaluating demand for products, financing a
technology business and dealing with government regulation of health information
technology products. While we are putting together a team of experienced
executives, they have come from different backgrounds and may require some time
to develop an efficient operating structure and corporate culture for our
Company.
THE SUCCESS OF OUR PRODUCTS AND SERVICES IN GENERATING REVENUE MAY BE
SUBJECT TO THE QUALITY AND COMPLETENESS OF THE DATA THAT IS GENERATED AND STORED
BY THE PHYSICIAN OR OTHER HEALTHCARE PROFESSIONALS AND ENTERED INTO OUR
INTERCONNECTIVITY SYSTEMS, INCLUDING THE FAILURE TO INPUT APPROPRIATE OR
ACCURATE INFORMATION. Failure or unwillingness by the healthcare professional to
accommodate the required information may result in Ramp not being paid for its
services.
AS A DEVELOPER OF CONNECTIVITY TECHNOLOGY PRODUCTS, WE WILL BE REQUIRED
TO ANTICIPATE AND ADAPT TO EVOLVING INDUSTRY STANDARDS AND NEW TECHNOLOGICAL
DEVELOPMENTS. The market for our technology is characterized by continued and
rapid technological advances in both hardware and software development,
requiring ongoing expenditures for research and development, and timely
introduction of new products and enhancements to existing products. The
establishment of standards is largely a function of user acceptance. Therefore,
such standards are subject to change. Our future success, if any, will depend in
part upon our ability to enhance existing products, to respond effectively to
technology changes, and to introduce new products and technologies that are
functional and meet the evolving needs of our clients and users in the
healthcare information systems market.
THE MARKET FOR OUR CONNECTIVITY PRODUCTS IN THE HEALTHCARE INFORMATION
SYSTEMS HAS BEEN SLOW TO DEVELOP DUE TO THE LARGE NUMBER OF PRACTITIONERS WHO
ARE RESISTANT TO CHANGE, AS WELL AS THE FINANCIAL INVESTMENT AND WORKFLOW
INTERRUPTIONS ASSOCIATED WITH CHANGE, PARTICULARLY IN A PERIOD OF RISING
PRESSURE TO REDUCE COSTS IN THE MARKETPLACE. We are currently devoting
significant resources toward the development of products. There can be no
assurance that we will successfully complete the development of these products
in a timely fashion or that our current or future products will satisfy the
needs of the healthcare information systems market.
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CERTAIN OF OUR PRODUCTS PROVIDE APPLICATIONS THAT RELATE TO PATIENT
MEDICATION HISTORIES AND TREATMENT PLANS. Any failure by our products to provide
and maintain accurate, secure and timely information could result in product
liability claims against us by our clients or their affiliates or patients. We
maintain insurance that we believe currently is adequate to protect against
claims associated with the use of our products, but there can be no assurance
that our insurance coverage would adequately cover any claim asserted against
us. A successful claim brought against us in excess of our insurance coverage
could have a material adverse effect on our results of operations, financial
condition or business. Even unsuccessful claims could result in the expenditure
of funds in litigation, as well as diversion of management time and resources.
Certain of our products are subject to compliance with the Health Insurance
Portability and Accountability Act. Failure to comply with the Health Insurance
Portability and Accountability Act may have a material adverse effect on the
business.
THE HEALTHCARE AND MEDICAL SERVICES INDUSTRY IN THE UNITED STATES IS IN
A PERIOD OF ONGOING CHANGE AND UNCERTAINTY. Governmental programs have been
proposed, and some adopted, from time to time, to reform various aspects of the
U.S. healthcare delivery system. Major legislation is now before the U.S.
Congress and may be adopted in some form. Some of these programs contain
proposals to increase government involvement in healthcare, lower reimbursement
rates and otherwise change the operating environment for our physician users and
customers. Particularly, compliance with the Health Insurance Portability and
Accountability Act and related regulations are causing the healthcare industry
to incur substantial cost to change its procedures. Although we expect these
regulations to have the beneficial effect of spurring adoption of our software
products, we cannot predict with any certainty what impact, if any, these and
future healthcare reforms might have on our business.
WE HAVE BEEN GRANTED CERTAIN PATENT RIGHTS, TRADEMARKS AND COPYRIGHTS
RELATING TO OUR SOFTWARE. However, patent and intellectual property legal issues
for software programs, such as the our products, are complex and currently
evolving. Since patent applications are secret until patents are issued in the
United States, or published in other countries, we cannot be sure that we are
first to file any patent application. In addition, there can be no assurance
that competitors, many of which have far greater resources than we do, will not
apply for and obtain patents that will interfere with our ability to develop or
market product ideas that we have originated. Furthermore, the laws of certain
foreign countries do not provide the protection to intellectual property that is
provided in the United States, and may limit our ability to market our products
overseas. We cannot give any assurance that the scope of the rights we have are
broad enough to fully protect our technology from infringement.
LITIGATION OR REGULATORY PROCEEDINGS MAY BE NECESSARY TO PROTECT OUR
INTELLECTUAL PROPERTY RIGHTS, SUCH AS THE SCOPE OF OUR PATENT. Such litigation
and regulatory proceedings are very expensive and could be a significant drain
on our resources and divert resources from product development. There is no
assurance that we will have the financial resources to defend our patent rights
or other intellectual property from infringement or claims of invalidity. We
have been notified by a party that it believes our pharmacy product may infringe
on patents that it holds. We have retained patent counsel who has made a
preliminary investigation and determined that our product does not infringe on
the identified patents. At this time no legal action has been instituted.
WE ALSO RELY UPON UNPATENTED PROPRIETARY TECHNOLOGY AND NO ASSURANCE
CAN BE GIVEN THAT OTHERS WILL NOT INDEPENDENTLY DEVELOP SUBSTANTIALLY EQUIVALENT
PROPRIETARY INFORMATION AND TECHNIQUES OR OTHERWISE GAIN ACCESS TO OR DISCLOSE
OUR PROPRIETARY TECHNOLOGY OR THAT WE CAN MEANINGFULLY PROTECT OUR RIGHTS IN
SUCH UNPATENTED PROPRIETARY TECHNOLOGY. No assurance can be given that efforts
to protect such information and techniques will be successful. The failure to
protect our intellectual property could have a material adverse effect on our
operating results, financial position and business over the long term.
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AS OF DECEMBER 31, 2003, WE HAD 144,305,822 SHARES OF COMMON STOCK
OUTSTANDING. AS OF THAT DATE, APPROXIMATELY 51,041,345 SHARES WERE ISSUABLE UPON
THE EXERCISE OF OPTIONS, WARRANTS OR OTHER RIGHTS, AND THE CONVERSION OF
CONVERTIBLE PREFERRED STOCK AND CONVERTIBLE DEBENTURES THEN OUTSTANDING. Most of
these shares will be immediately saleable upon exercise or conversion under
registration statements we have filed with the SEC. The exercise prices of
options, warrants or other rights to acquire common stock presently outstanding
range from $0.01 per share to $4.97 per share. During the respective terms of
the outstanding options, warrants, preferred stock and other outstanding
derivative securities, the holders are given the opportunity to profit from a
rise in the market price of the common stock, and the exercise of any options,
warrants or other rights may dilute the book value per share of the common stock
and put downward pressure on the price of the common stock. The existence of the
options, conversion rights, or any outstanding warrants may adversely affect the
terms on which we may obtain additional equity financing. Moreover, the holders
of such securities are likely to exercise their rights to acquire common stock
at a time when we would otherwise be able to obtain capital on terms more
favorable than could be obtained through the exercise or conversion of such
securities.
WE HAVE RAISED SUBSTANTIAL AMOUNTS OF CAPITAL IN PRIVATE PLACEMENTS
FROM TIME TO TIME. The securities offered in such private placements were not
registered with the SEC or any state agency in reliance upon exemptions from
such registration requirements. Such exemptions are highly technical in nature
and if we inadvertently failed to comply with the requirements of any of such
exemptive provisions, investors would have the right to rescind their purchase
of our securities or sue for damages. If one or more investors were to
successfully seek such rescission or prevail in any such suit, we could face
severe financial demands that could materially and adversely affect our
financial position. Financings that may be available to us under current market
conditions frequently involve sales at prices below the prices at which our
common stock currently trades on the American Stock Exchange, as well as the
issuance of warrants or convertible securities at a discount to market price.
INVESTORS IN OUR SECURITIES MAY SUFFER DILUTION. The issuance of shares
of common stock, or shares of common stock underlying warrants or preferred
stock sold in this offering will dilute the equity interest of existing
stockholders and could have a significant adverse effect on the market price of
our common stock. The sale of common stock acquired at a discount could have a
negative impact on the market price of the common stock and could increase the
volatility in the market price of the common stock. In addition, we may seek
additional financing which may result in the issuance of additional shares of
our common stock and/or rights to acquire additional shares of our common stock.
The issuance of our common stock in connection with such financing may result in
substantial dilution to the existing holders of our common stock. Those
additional issuances of our common stock would result in a reduction of your
percentage interest in Ramp.
HISTORICALLY, OUR COMMON STOCK HAS EXPERIENCED SIGNIFICANT PRICE
FLUCTUATIONS. One or more of the following factors influence these fluctuations:
o unfavorable announcements or press releases relating to the
technology sector;
o regulatory, legislative or other developments affecting Ramp or
the healthcare industry generally;
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o conversion of our preferred stock and convertible debt into common
stock at conversion rates based on then current market prices or
discounts to market prices, of our common stock and exercise of
options and warrants at below current market prices;
o sales by those financing Ramp through convertible securities which
have been registered with the SEC and may be sold into the public
market immediately upon receipt; and
o market conditions specific to technology and internet companies,
the healthcare industry and general market conditions.
IN ADDITION, IN RECENT YEARS THE STOCK MARKET HAS EXPERIENCED
SIGNIFICANT PRICE AND VOLUME FLUCTUATIONS. These fluctuations, which are often
unrelated to the operating performance of specific companies, have had a
substantial effect on the market price for many healthcare related technology
companies. Factors such as those cited above, as well as other factors that may
be unrelated to our operating performance, may adversely affect the price of our
common stock.
TRADING OF OUR COMMON STOCK MAY BE SUBJECT TO THE PENNY STOCK RULES
UNDER THE SECURITIES EXCHANGE ACT OF 1934 UNLESS AN EXEMPTION FROM SUCH RULES IS
AVAILABLE. Broker-dealers making a market in our common stock will be required
to provide disclosure to their customers regarding the risks associated with our
common stock, the suitability for the customer of an investment in our common
stock, the duties of the broker-dealer to the customer and information regarding
bid and asked prices for our common stock, and the amount and description of any
compensation the broker-dealer would receive in connection with a transaction in
our common stock. The application of these rules may further result in fewer
market makers making a market in our common stock and further restrict the
liquidity of our common stock.
WE HAVE NOT HAD EARNINGS, BUT IF EARNINGS WERE AVAILABLE, IT IS OUR
GENERAL POLICY TO RETAIN ANY EARNINGS FOR USE IN OUR OPERATION. Therefore, we do
not anticipate paying any cash dividends on our common stock in the foreseeable
future despite the recent reduction of the federal income tax rate on dividends.
Any payment of cash dividends on our common stock in the future will be
dependent upon our financial condition, results of operations, current and
anticipated cash requirements, preferred rights of holders of preferred stock,
plans for expansion, as well as other factors that the Board of Directors deems
relevant. In addition, the holders of our outstanding Series A Convertible
Preferred Stock will receive a preference to holders of our common stock with
respect to the distribution of dividends. We anticipate that our future
financing agreements may prohibit the payment of common stock dividends without
the prior written consent of those investors.
WE MAY HAVE TO LOWER PRICES OR SPEND MORE MONEY TO EFFECTIVELY COMPETE
AGAINST COMPANIES WITH GREATER RESOURCES THAN US, WHICH COULD RESULT IN LOWER
REVENUES. The success of our products in the marketplace depends on many
factors, including product performance, price, ease of use, support of industry
standards, competing technologies and customer support and service. Given these
factors we cannot assure you that we will be able to compete successfully. For
example, if our competitors offer lower prices, we could be forced to lower
prices which could result in reduced or negative margins and a decrease in
revenues. If we do not lower prices we could lose sales and market share. In
either case, if we are unable to compete against our main competitors which
include established companies with significant financial resources, we would not
be able to generate sufficient revenues to grow our company or reverse our
history of operating losses. In addition, we may have to increase expenses to
8
effectively compete for market share, including funds to expand our
infrastructure, which is a capital and time intensive process. Further, if other
companies choose to aggressively compete against us, we may have to increase
expenses on advertising, promotion, trade shows, product development, marketing
and overhead expenses, hiring and retaining personnel, and developing new
technologies. These lower prices and higher expenses would adversely affect our
operations and cash flows.
AS WITH ANY BUSINESS, GROWTH IN ABSOLUTE AMOUNTS OF SELLING, GENERAL
AND ADMINISTRATIVE EXPENSES OR THE OCCURRENCE OF EXTRAORDINARY EVENTS COULD
CAUSE ACTUAL RESULTS TO VARY MATERIALLY AND ADVERSELY FROM THE RESULTS
CONTEMPLATED BY THE FORWARD-LOOKING STATEMENTS. Budgeting and other management
decisions are subjective in many respects and thus susceptible to incorrect
decisions and periodic revisions based on actual experience and business
developments, the impact of which may cause us to alter our marketing, capital
expenditures or other budgets, which may, in turn, affect our results of
operations. Assumptions relating to the foregoing involve judgments with respect
to, among other things, future economic, competitive and market conditions, and
future business decisions, all of which are difficult or impossible to predict
accurately and many of which are beyond our control. Although we believe the
assumptions underlying the forward-looking statements are reasonable, any of the
assumptions could prove inaccurate, and therefore, there can be no assurance
that the results contemplated in the forward-looking statements will be
realized.
IN LIGHT OF THE SIGNIFICANT UNCERTAINTIES INHERENT IN THE
FORWARD-LOOKING INFORMATION INCLUDED HEREIN, THE INCLUSION OF SUCH INFORMATION
SHOULD NOT BE REGARDED AS A REPRESENTATION BY US OR ANY OTHER PERSON THAT OUR
OBJECTIVES OR PLANS FOR THE COMPANY WILL BE ACHIEVED.
FORWARD-LOOKING STATEMENTS
Certain information contained in this prospectus and the documents
incorporated by reference into this prospectus include forward-looking
statements (as defined in Section 27A of the Securities Act and Section 21E of
the Securities Exchange Act), which mean that they relate to events or
transactions that have not yet occurred, our expectations or estimates for our
future operations, our growth strategies or business plans or other facts that
have not yet occurred. Such statements can be identified by the use of
forward-looking terminology such as "might," "may," "will," "could," "expect,"
"anticipate," "estimate," "likely," "believe," or "continue" or the negative
thereof or other variations thereon or comparable terminology. The above risk
factors contain discussions of important factors that should be considered by
prospective investors for their potential impact on forward-looking statements
included in this prospectus and in the documents incorporated by reference into
this prospectus. These important factors, among others, may cause actual results
to differ materially and adversely from the results expressed or implied by the
forward-looking statements.
USE OF PROCEEDS
The selling security holders will receive the net proceeds from the
sale of shares. We will not receive any of the proceeds from any sale of the
shares by the selling security holders. However, we will receive the proceeds
from the cash exercise of warrants to purchase certain of the shares offered
hereunder. If all warrants covered hereby are exercised for cash in accordance
with their terms, we would receive gross proceeds of $2,969,695. Any such gross
proceeds will be used for working capital purposes.
9
DESCRIPTION OF THE TRANSACTIONS
On October 1, 2002, we entered into a Consulting Agreement with Mr.
Benjamin Mayer, which agreement was amended by our mutual agreement on December
4, 2003 (as amended, the "Consulting Agreement"), whereby Mr. Mayer agreed to
perform financial advisory services to us. In connection with the Consulting
Agreement, as a portion of compensation owed to Mr. Mayer and in addition to
payment in cash of $100,000 from us to Mr. Mayer, we agreed to issue to Mayer &
Associates LLC, an entity owned and controlled by Mr. Mayer, warrants to
purchase an aggregate of 145,250 shares of our common stock, exercisable at
$0.30 cents per share, for a five-year term. We also issued warrants to purchase
an aggregate of 186,468 shares of our common stock exercisable at $0.61 cents
per share for a five-year term. In connection with the issuance of warrants, we
agreed to register the shares underlying the warrants with the SEC on a
registration statement (of which this prospectus forms a part).
From the period commencing April 22, 2003 through July 14, 2003, we
entered into private placement transactions to accredited investors, consisting
of thirteen individual and two institutional investors, whereby we sold an
aggregate of 285,000 units at a purchase price of $2.00 per unit. Each unit
consisted of ten shares of common stock and warrants, to purchase five shares of
common stock. The warrants are exercisable for a five-year term. The aggregate
number of shares of common stock sold in the private placement transactions was
2,850,000 and warrants to purchase 1,550,000 shares of common stock, which
includes an additional 125,000 shares underlying warrants issued to one
investor. We received aggregate gross proceeds of $570,000 as a result of these
private placements. We agreed to register the shares of common stock and shares
underlying the warrants on a registration statement (of which this prospectus
forms a part).
On November 10, 2003, in connection with an Asset Purchase Agreement
(the "Asset Purchase Agreement") entered into between the Company and The Duncan
Group, Inc., ("DGI"), we completed the purchase of substantially all of the
tangible and intangible assets, and assumed certain liabilities, of DGI, d/b/a
Frontline Physicians Exchange ("Frontline"). In connection with the Asset
Purchase Agreement, we agreed to pay (a) $1,567,000 in cash at the closing, (b)
$500,000 to be paid in common stock, (c) $1,500,000 to be paid in common stock
which is forfeitable if Frontline's gross revenue does not total at least $1
million for the calendar year ended 2003, (d) additional cash payments equal to
15% of Frontline's gross revenue during 2003 and 2004, (e) up to an additional
$1,500,000 to be paid in common stock based on the number of physician offices
that are active customers of DGI who adopt our technology and generate certain
revenues to us, and (f) an additional $1 million of common stock if the average
annual revenue of Frontline for the calendar years ending 2003 and 2004 equals
or exceeds $1,500,000. In connection with (b) and (c) above, we agreed to issue
to DGI at closing such number of shares of our common stock equal in value to
the specified dollar amounts above, which number of shares were based upon the
average closing price of our common stock for the twenty (20) days immediately
preceding the closing date. Utilizing this formula, we issued an aggregate of
3,663,004 shares of common stock to DGI at closing, which we valued at $.72
cents per share, the closing stock price on November 10, 2003, in accordance
with Emerging Issues Task Force 99-12, Determination of the Measurement Date for
the Market Price of Acquirer Securities Issued in a Purchase Business
Combination. We agreed to register an aggregate of 915,751 shares of common
stock on a registration statement (of which this prospectus forms a part).
In connection with the Asset Purchase Agreement, Nancy L. Duncan and M.
David Duncan, stockholders of DGI, entered into employment agreements with us.
Nancy L. Duncan became an executive vice president and M. David Duncan became a
senior vice president with two-year employment agreements, currently ending on
November 3, 2005, which are renewable for additional one-year periods. The
employment agreements provide that each officer will be compensated at an
10
annual salary of $140,000. The agreements are terminable by either us or Ms.
Duncan or Mr. Duncan, as the case may be, for any reason on ninety days notice.
If Ms. Duncan or Mr. Duncan, as the case may be, is terminated by the Company
without cause prior to November 3, 2005, they will be entitled to their base
salary for three months or the balance of the initial term, whichever is less.
Nancy L. Duncan and M. David Duncan are husband and wife and together own all of
the issued and outstanding shares of The Duncan Group, Inc.
On December 31, 2003, we entered into a Series A Convertible Preferred
Stock Purchase Agreement (the "December Agreement") with Canon Ventures Limited
("Canon"), a non-US based accredited investor, which is not affiliated with the
Company. Under the terms of the December Agreement, we sold to Canon an
aggregate of 3,000 shares of Series A Convertible Preferred Stock for the
purchase price of $3,000,000. Each share of the Series A Convertible Preferred
Stock is convertible into a number of shares of common stock equal to $1000
divided by the conversion price of the Series A Convertible Preferred Stock,
initially $0.40 cents per share. The total number of shares of common stock
initially issuable upon conversion of the Series A Convertible Preferred Stock
issued to Canon is 7,500,000. In addition, we issued to Canon warrants to
purchase an aggregate of 3,100,000 shares of our common stock, 2,350,000 of
which are exercisable at $0.61 cents per share and 750,000 of which are
exercisable at $0.70 cents per share. The warrants have a term of five years.
Pursuant to the Registration Rights Agreement entered into concurrently
with the December Agreement, we have agreed to register the shares of common
stock underlying the Series A Convertible Preferred Stock and warrants with the
SEC on a registration statement (of which this prospectus forms a part) and to
pay to Canon liquidated damages if the registration statement is not filed on or
before January 28, 2004 or is not declared effective within 90 days following
such date, an amount equal to 1% of the purchase price for each calendar month
(or portion thereof) of delayed effectiveness.
vFinance Investments, Inc. served as placement agent for sale of the
Series A Convertible Preferred Stock under the December Agreement. In connection
with this financing transaction, vFinance received warrants to purchase an
aggregate of 637,500 shares of our common stock, at an exercise price of $0.61
cents per share. As part of vFinance's compensation, two of vFinance's managing
directors, Richard Rosenblum and David Stefansky, received an aggregate of 112
shares of Series A Convertible Preferred Stock with terms identical to those
contained in the preferred stock sold to Canon, initially convertible into an
aggregate of 280,000 shares of common stock. Of the warrants issued to vFinance,
vFinance distributed to each of Messrs. Rosenblum and Stefanksy, respectively,
warrants to purchase 186,468 shares of our common stock at an exercise price of
$0.61 cents. Each of the warrants has a term of five years. We agreed to
register the shares of common stock underlying the Series A Convertible
Preferred Stock and warrants on a registration statement (of which this
prospectus forms a part).
Krieger & Prager, LLP served as outside legal counsel to Canon in
connection with Canon's investment in the Company. In lieu of a portion of the
cash compensation, we agreed to issue to Krieger & Prager, LLP the amount of
26,230 shares of common stock. We agreed to register these shares on a
registration statement (of which this prospectus forms a part).
Reference is made to the Consulting Agreement, Stock Purchase
Agreement, Asset Purchase Agreement, Certificate of Designation for the Series A
Convertible Preferred Stock, December Agreement, the Warrants, and Registration
Rights Agreements that are filed as exhibits to the Registration Statement for
more complete descriptions of the provisions that are summarized under this
caption.
11
SELLING STOCKHOLDERS
The following table sets forth the shares beneficially owned, as of
January 26, 2004, by the selling stockholders prior to the offering contemplated
by this prospectus, the number of shares each selling stockholder is offering by
this prospectus and the number of shares which each would own beneficially if
all such offered shares are sold. The selling stockholders acquired their
beneficial interests in the shares being offered hereby in transactions
described under the heading "Description of the Transactions." Except as
expressly set forth below, none of the selling stockholders is a registered
broker-dealer or an affiliate of a registered broker-dealer. Each of the selling
stockholders has acquired his, her or its shares solely for investment and not
with a view to or for resale or distribution of such securities.
Beneficial ownership is determined in accordance with SEC rules and
includes voting or investment power with respect to the securities. However,
each of the selling stockholders is subject to certain limitations on the
conversion of their convertible preferred stock, if any and the exercise of
their warrants, if any. The most significant of these limitations is that such
selling stockholder may not convert its preferred stock or exercise its
warrants, if such conversion or exercise would cause such holder's beneficial
ownership of our common stock (excluding shares underlying any of their
unconverted preferred stock or unexercised warrants) to exceed 4.99% of the
outstanding shares of common stock.
Number of
Shares of Percentage of
Shares of Common Common Stock Common Stock
Stock Owned Prior Shares of Common Owned After Owned After
Names and Addresses to Offering Stock to be Sold the Offering the Offering
------------------- ------------------ ---------------- ------------ ------------
Canon Ventures Limited (1) 10,600,000 10,600,000 (2)(3) 0 0
Richard Rosenblum (4) 1,245,446 326,468 (2)(5) 918,978 (6) *
David Stefansky (4) 1,245,446 326,468 (2)(5) 918,978 (6) *
vFinance Investments, Inc. (7) 884,521 264,564 (8) 619,957 (6) *
Mayer & Associates LLC (9) 608,218 331,718 (2)(10) 276,500 *
The Duncan Group, Inc. (11) 915,751 915,751 0 0
WEC Asset Management LLC (12) 375,000 375,000 (13) 0 0
Joseph R. Galinski (14) 375,000 375,000 (15) 0 0
Paul Bowman (16) 150,000 150,000 (17) 0 0
Dan & Fran Berrey Living Trust (18) 1,062,492 562,500 (19) 499,992 *
Black Hills Investment Corp. (20) 907,500 187,500 (21) 720,000 *
Jeffrey Douglas Raines (22) 375,000 375,000 (23) 0 0
Michael S. Brown (24) 750,000 750,000 (25) 0 0
Josh Weinfeld (26) 112,500 112,500 (27) 0 0
James Ricciardi (28) 375,000 375,000 (29) 0 0
William H. Troxel (30) 300,000 300,000 (31) 0 0
Kimberley A. Hollingsworth (32) 75,000 75,000 (33) 0 0
Michael W. Troxel (34) 75,000 75,000 (35) 0 0
James R. Palmersheim (36) 312,500 312,500 (37) 0 0
Wayne Saker (38) 500,000 500,000 (39) 0 0
Krieger & Prager, LLP (40) 26,230 26,230 0 0
----------
* Less than 1%
(1) The selling stockholder advised us that the natural person having voting or
dispositive power over such notes and the related shares of common stock is Ms.
Michal Cohen. The address of the selling shareholder is 11 Lamed Hae Street,
Givatayim, Israel.
(2) The numbers on the table reflect the actual number of shares issued or
issuable to the selling stockholder. We are registering 120% of the shares
underlying the convertible preferred stock held by the selling stockholder to
include other shares of our common stock which might be issuable to the selling
stockholder under the terms of the agreements between us and the selling
stockholder. See the sections of this prospectus titled "Description of the
Transactions" and "Description of Securities" for more information regarding our
Series A Convertible Preferred Stock.
12
(3) Includes 7,500,000 shares issuable on conversion of Series A Convertible
Preferred Stock and 3,100,000 shares issuable upon exercise of warrants to
purchase shares of common stock.
(4) The selling stockholder is a Managing Director of vFinance Investments, Inc.
(5) Includes 140,000 shares of common stock issuable on conversion of Series A
Convertible Preferred Stock and 186,468 shares issuable upon exercise of
warrants to purchase shares of common stock.
(6) The selling stockholder may sell these shares pursuant to a separate
registration statement which has been declared effective by the SEC.
(7) The selling stockholder is a registered broker-dealer, which acted as
placement agent for the private placement to Canon Ventures Limited. The selling
stockholder advised us that the only natural persons having voting or
dispositive power over such warrants and the related shares of common stock are
Leonard Sokolow and Timothy Mahoney. The address of the selling shareholder is
3010 N. Military Trail, Suite 300, Boca Raton, FL 33431.
(8) Includes shares issuable on exercise of warrants issued to the placement
agent.
(9) The selling stockholder advised us that the only natural person having
voting or dispositive power over such shares is Mr. Benjamin Mayer. The address
of the selling stockholder is 246 12th Street, Lakewood, New Jersey 08701.
(10) Includes 331,718 shares issuable upon exercise of warrants to purchase
shares of common stock.
(11) The selling stockholder advised us that the natural persons having voting
or dispositive power over such shares are Mr. M. David Duncan and Mrs. Nancy L.
Duncan, Chief Executive Officer and President, respectively, of the selling
stockholder. The address of the selling stockholder is 9302 North Meridian
Street, Suite 350, Indianapolis, Indiana 46260.
(12) The selling stockholder advised us that the natural persons having voting
or dispositive power over such shares are Mr. Ethan Benovitz, Ms. Jaime Hartman
and Mr. Daniel Saks, each a managing director. The address of the selling
stockholder is 145 Huguenot Street, Suite 404, New Rochelle, New York 10801.
(13) Includes 125,000 shares issuable on exercise of warrants.
(14) The address of the selling stockholder is 56-44th Avenue, St. Petersburg
Beach, Florida 33706.
(15) Includes 125,000 shares issuable on exercise of warrants.
(16) The address of the selling stockholder is 2141 Gulf of Mexico Drive #6,
Longboat Key, Florida 34228.
(17) Includes 50,000 shares issuable on exercise of warrants.
(18) The address of the selling stockholder is P.O. Box 3500 #224, Sisters,
Oregon 97759.
(19) Includes 187,500 shares issuable on exercise of warrants.
(20) The selling stockholder advised us that the only natural person having
voting or dispositive power over such shares is Mr. Larry Gibson. The address of
the selling stockholder is 330 S. Decatur Boulevard #1000, Las Vegas, Nevada
89107.
(21) Includes 62,500 shares issuable on exercise of warrants.
(22) The address of the selling stockholder is 3346 Fir Tree Drive S., Salem,
Oregon 97302.
(23) Includes 125,000 shares issuable on exercise of warrants.
(24) The address of the selling stockholder is 16601 Ventura Boulevard, #204,
Encino, California 91436.
13
(25) Includes 250,000 shares issuable on exercise of warrants.
(26) The address of the selling stockholder is 54 Gudz Road, Lakewood, New
Jersey 08701.
(27) Includes 37,500 shares issuable on exercise of warrants.
(28) The address of the selling stockholder is 5 Hilltop Circle, Mendham, New
Jersey 07945.
(29) Includes 125,000 shares issuable on exercise of warrants.
(30) The address of the selling stockholder is 916 Orchid Point Way, Vero Beach,
Florida 32963.
(31) Includes 100,000 shares issuable on exercise of warrants.
(32) The address of the selling stockholder is 6805 Munford Drive, Fayetteville,
North Carolina 28306.
(33) Includes 25,000 shares issuable on exercise of warrants.
(34) The address of the selling stockholder is 11645 Chancery Lane, Cincinnati,
Ohio 45249.
(35) Includes 25,000 shares issuable on exercise of warrants.
(36) The address of the selling stockholder is 5129 Haydenbend Circle,
Grapevine, Texas 76051.
(37) Includes 62,500 shares issuable on exercise of warrants.
(38) The address of the selling stockholder is 55 Shaw Road, Chestnut Hill,
Massachusetts 02467.
(39) Includes 250,000 shares issuable on exercise of warrants.
(40) The selling stockholder advised us that the only natural person having
voting or dispositive power over such shares is Mr. Samuel M. Krieger. The
address of the selling stockholder is 39 Broadway, Suite 1440, New York, New
York 10006.
RELATIONSHIP BETWEEN RAMP AND THE SELLING STOCKHOLDERS
Except as disclosed in this prospectus, none of the selling
stockholders are affiliates or controlled by our affiliates. Except as disclosed
in this prospectus, none of the selling stockholders are now or were at any time
in the past an officer or director of ours or any of any of our predecessors or
affiliates. We have separate contractual obligations to file this registration
statement (of which this prospectus forms a part) with each of the selling
stockholders.
DESCRIPTION OF SECURITIES
Our authorized capital consists of 400,000,000 shares of common stock,
par value $.001 per share, and 2,500,000 shares of preferred stock, par value
$1.00 per share. As of December 31, 2003, we had outstanding 144,305,822 shares
of common stock, 3,112 shares of Series A Convertible Preferred Stock, 1 share
of 1996 Preferred Stock and 75 shares of 1999 Series C Preferred Stock. As of
such date, our common stock was held of record by approximately 460 persons and
beneficially owned by approximately 10,000 persons.
COMMON STOCK
Each share of common stock is entitled to one vote at all meetings of
stockholders. Stockholders are not permitted to accumulate votes in the election
of directors. Currently, the Board of Directors consists of six directors, who
serve for staggered terms of three years, with at least two directors elected at
every annual meeting. We also currently have one vacancy on our Board of
Directors. All shares of common stock are equal to each other with respect to
liquidation rights and dividend rights. There are no preemptive rights to
purchase any additional shares of common stock. In the event of our liquidation,
dissolution or winding up, holders of the common stock will be entitled to
receive on a pro rata basis all of our assets remaining after satisfaction of
all liabilities and preferences of the outstanding preferred stock.
14
PREFERRED STOCK
We are authorized to issue up to 2,500,000 shares of preferred stock.
Our preferred stock may be issued in one or more series, the terms of which may
be determined at the time of issuance by our board of directors, without further
action by stockholders and may include voting rights (including the right to
vote as a series on particular matters), preferences as to dividends and
liquidation, conversion, redemption rights and sinking fund provisions. The
issuance of preferred stock could reduce the rights, including voting rights, of
the holders of common stock, and, therefore, reduce the value of our common
stock. In particular, specific rights granted to future holders of preferred
stock could be used to restrict our ability to merge with or sell our assets to
a third party, thereby preserving control of Ramp Corporation by existing
management.
SERIES A CONVERTIBLE PREFERRED STOCK
As of December 31, 2003, 3,112 shares of our Series A Convertible
Preferred Stock, $1.00 par value, were outstanding.
Dividends on Series A Convertible Preferred Stock
The shares of Series A Convertible Preferred Stock bear a cumulative
dividend at a rate of 6% per annum which shall accrue quarterly and be paid as
and when declared by the Board of Directors. Except in certain limited
circumstances, dividends may be paid by us, at our option, either through the
issuance of shares of common stock or in cash. If we elect to pay the dividend
in shares of common stock, we will issue a number of shares of common stock
equal to the quotient of the dividend payment divided by the conversion price,
which is initially $0.40 cents, which conversion price may be adjusted as set
forth below if certain events occur.
Liquidation Preference on Series A Convertible Preferred Stock
In the event of a liquidation of our company, the holders of shares of
the Series A Convertible Preferred Stock are entitled to receive a liquidation
payment prior to the payment of any amount with respect to the shares of our
common stock. The amount of this preferential liquidation payment is $1,000 per
share of Series A Convertible Preferred Stock, plus the amount of any accrued
but unpaid dividends on those shares. After payment of the full liquidation
preference amount, the holders of the Series A Convertible Preferred Stock will
not be entitled to any further participation as such in any distribution of our
assets.
Optional Conversion of Series A Convertible Preferred Stock
The Series A Convertible Preferred Stock is convertible into common
stock at any time at the option of the holder. Each outstanding share of Series
A Convertible Preferred Stock is convertible into a number of shares of common
stock equal to $1,000, plus any accrued but unpaid dividends, divided by the
conversion price of the Series A Convertible Preferred Stock, which is initially
$0.40 cents, but may be adjusted as set forth below if certain events occur. The
conversion price of the Series A Convertible Preferred Stock can be adjusted
downward for a period of sixty (60) days following December 31, 2003 in the
event of the issuance of shares of common stock at a price less than the
conversion price then in effect during such time period. If we issue equity
securities for a per share price less than the conversion price of the Series A
Convertible Preferred Stock, which is initially $0.40 cents, the conversion
price will be adjusted to the price of the common stock sold.
15
Mandatory Conversion of Series A Convertible Preferred Stock
Beginning the first date, which date shall be at least ninety (90)
days, following the effective date of the registration statement which registers
all of the common stock issuable upon the conversion of the Series A Convertible
Preferred Stock, and provided that certain conditions described below are met,
each share of Series A Convertible Preferred Stock will be automatically
converted into a number of shares of common stock equal to $1,000, plus any
accrued but unpaid dividends, divided by the conversion price of the Series A
Convertible Preferred Stock. Mandatory conversion may only occur if the volume
weighted average price of the common stock (using the Bloomberg VWAP functions)
on the American Stock Exchange exceeds $1.20 (as adjusted for stock splits,
stock dividends, combinations and similar transactions) for ten (10) consecutive
trading days and either the registration statement governing the underlying
shares of common stock is effective or the shares of common stock issuable upon
conversion of the Series A Convertible Preferred Stock can be sold pursuant to
Rule 144(k) of the Securities Act of 1933. The mandatory conversion date will be
extended for so long as the following events have occurred and are continuing:
o the effectiveness of the registration statement lapses for
thirty (30) consecutive trading days (other than as a result
of factors solely in control of the holders of the Series A
Convertible Preferred Stock) and the shares of common stock
into which the shares of Series A Convertible Preferred Stock
are convertible cannot be sold pursuant to Rule 144(k);
o the common stock is suspended from listing without subsequent
listing on any one of, or is not listed on at least one of,
the American Stock Exchange, the Nasdaq National Market, the
Nasdaq SmallCap Market, the OTC Bulletin Board, or the New
York Stock Exchange, Inc. for five (5) consecutive trading
days;
o we provide notice to the holders of Series A Convertible
Preferred Stock that we will not or cannot comply with a
proper conversion notice; or
o we fail to comply with a proper conversion notice within ten
(10) business days of receipt of that notice.
If, however, on the mandatory conversion date, a holder is prohibited
from converting all of its shares of Series A Convertible Preferred Stock as a
result of the restrictions described below under "Conversion Restrictions," such
shares of Series A Convertible Preferred Stock will not be converted, will
remain outstanding and will continue to accrue dividends.
Conversion Restrictions
Unless we seek and obtain stockholder approval, the number of shares of
common stock we may issue upon the conversion of the shares of Series A
Convertible Preferred Stock (when aggregated with the number of shares of common
stock issued as dividends on the Series A Convertible Preferred Stock and upon
exercise of the warrants issued to the placement agent and its affiliates for
the Series A Convertible Preferred Stock financing) is limited to 23,122,355
shares (representing 19.999% of our total outstanding common stock as of
December 31, 2003 immediately prior to the issuance of the Series A Convertible
Preferred Stock). In addition, no holder may convert shares of Series A
Convertible Preferred Stock if conversion of those shares would result in the
holder owning more than 4.99% of the common stock then outstanding or would
result in the holder beneficially owning more than 9.999% of the common stock
then outstanding, unless the holder waives this limitation at least sixty-five
(65) days prior to the proposed conversion.
16
Failure to Convert
If for any reason upon an optional or mandatory conversion we cannot
issue shares of common stock which have been registered for resale pursuant to
an effective registration statement, then we will be obligated to issue as many
shares of common stock as we are able to issue. If we do not have enough shares
of common stock to cover the conversion of all outstanding shares of Series A
Convertible Preferred Stock, then with respect to the unconverted shares of
Series A Convertible Preferred Stock (other than unconverted Series A
Convertible Preferred Stock resulting from the restrictions described above
under "Conversion Restrictions"), the holder will have the right to (i) void its
conversion notice, (ii) require us to redeem the unconverted shares of Series A
Convertible Preferred Stock at a price per share equal to $1,000 plus liquidated
damages and accrued and unpaid dividends or (iii) require us to issue shares of
common stock that have not been registered pursuant to the Securities Act. If
the holder elects redemption, we may pay the redemption price either in cash or,
in certain circumstances, in shares of common stock based on the quotient of the
redemption price divided by the greater of 100% of the volume weighted average
price of the common stock (using the Bloomberg VWAP functions) on the American
Stock Exchange for the ten (10) consecutive trading days ending on the 11th
trading day prior to the redemption date and the conversion price.
Redemption of Series A Convertible Preferred Stock
The holders of Series A Convertible Preferred Stock are entitled to
require us to redeem their shares of Series A Convertible Preferred Stock
immediately prior to the consolidation, merger or business combination of Ramp
Corporation with another entity (other than pursuant to a migratory merger
effected solely for the purpose of changing the jurisdiction of incorporation of
Ramp Corporation or a consolidation, merger or other business combination in
which holders of Ramp Corporation's voting power immediately prior to the
transaction continue after the transaction to hold, directly or indirectly, the
voting power of the surviving entity or entities necessary to elect a majority
of the members of the board of directors (or their equivalent if other than a
corporation) of such entity or entities), the sale or transfer of more than 50%
of Ramp Corporation's assets (other than inventory in the ordinary course of
business) or the closing of a purchase, tender or exchange offer made to the
holders of more than 50% of the outstanding common stock. In such an event, the
redemption price per share will equal $1,000 plus accrued and unpaid dividends.
We may pay the redemption price in either cash or shares of common stock based
on the quotient of the redemption price divided by the greater of (x) the volume
weighted average price (using the Bloomberg VWAP function) of the Common Stock
on The American Stock Exchange for the ten (10) trading days ending on the 11th
trading day prior to the redemption date and (y) the conversion price.
In addition, the holders of Series A Convertible Preferred Stock are
entitled to redeem their shares of Series A Convertible Preferred Stock if the
following events occur:
o the effectiveness of the registration statement lapses for
thirty (30) consecutive trading days (other than as a result
of factors solely in control of the holders of the Series A
Convertible Preferred Stock) and the shares of common stock
into which the Series A Convertible Preferred Stock are
convertible cannot be sold pursuant to Rule 144(k);
o the common stock is suspended from listing without subsequent
listing on any one of, or is not listed on at least one of,
the American Stock Exchange, Inc., the Nasdaq National Market,
the Nasdaq SmallCap Market, the OTC Bulletin Board, or the New
York Stock Exchange, Inc. for five (5) consecutive trading
days;
17
o we provide notice to the holders of Series A Convertible
Preferred Stock that we will not or cannot comply with a
conversion notice that was properly executed and delivered; or
o we fail to comply with a proper conversion notice within ten
(10) business days of receipt of that notice (other than as a
result of the restrictions described above under "Conversion
Restrictions").
With respect to the events set forth above, the redemption price per
share will equal $1,000 plus accrued and unpaid dividends. If the effectiveness
of the registration statement lapses, listing is suspended or the holders
receive a notice that we will not or cannot comply with a conversion notice, we
may choose to pay the redemption price in shares of common stock based on the
quotient of the redemption price divided by the greater of (x) the volume
weighted average price (using the Bloomberg VWAP function) of the Common Stock
on The American Stock Exchange for the ten (10) trading days ending on the 11th
trading day prior to the redemption date and (y) the conversion price. If we
fail to respond to a conversion notice in a timely fashion, we must pay the
redemption price in cash.
Commencing thirty-six (36) months following the date of issuance of the
Series A Convertible Preferred Stock (and so long as a registration statement
covering the resale of the shares of common stock underlying the Series A
Convertible Preferred Stock and related warrants is effective and none of the
events listed in the four bullet points above has occurred and is continuing),
we may, at our option, redeem all or any portion of the outstanding Series A
Convertible Preferred Stock upon five (5) days prior written notice at a price
per share of 120% of $1,000 per share of Series A Preferred Convertible Stock,
plus the amount of any accrued but unpaid dividends on those shares. However, if
a holder has delivered a conversion notice to us within seventy-two (72) hours
of receipt of our redemption notice for all or a portion of such shares, up to
50% of the shares of Series A Convertible Preferred Stock which we have
designated for redemption may be converted by the holder. In addition, if during
the period between the date of our redemption notice and the redemption date a
holder becomes entitled to redeem the Series A Convertible Preferred Stock as a
result of a consolidation, merger or business combination of Ramp Corporation
with another entity, the sale or transfer of more than 50% of our assets (other
than inventory in the ordinary course of business) or the closing of a purchase,
tender or exchange offer made to the holders of more than 50% of the common
stock, the right of the holder with respect to the conversion will take
precedence over our redemption notice.
Liquidated Damages for Failure to File and Maintain Registration Statement
We have agreed with the holders of the Series A Convertible Preferred
Stock that such stockholders will suffer damages if the registration statement
of which this prospectus is a part is not declared effective by the Securities
and Exchange Commission within 90 days following January 28, 2004 and if its
effectiveness is not thereafter maintained by us in an agreed upon manner. We
and such stockholders have stipulated to an agreed upon amount of liquidated
damages to be paid to such stockholders in connection with such a failure. The
agreed liquidated damages will be up to 1% of the amount of the stockholders'
initial investment for each calendar month or portion thereof until the failure
is cured. Liquidated damages may be paid in cash or shares of common stock, at
our option.
TRANSFER AGENT AND REGISTRAR
We have retained Computershare Trust Company, Inc., 350 Indiana Street,
Suite 800, Golden, Colorado 80401, as Transfer Agent and Registrar, for our
common stock. Computershare Trust Company's telephone number is (303) 262-0600.
18
PLAN OF DISTRIBUTION
The selling security holders and any of their pledgees, donees,
assignees and successors-in-interest may, from time to time, sell any or all of
their shares of common stock on any stock exchange, market or trading facility
on which the shares are traded. These sales may be at fixed or negotiated
prices. The selling security holders may use any one or more of the following
methods when selling shares:
o ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
o block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block
as principal to facilitate the transaction;
o purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
o an exchange distribution in accordance with the rules of the
applicable exchange;
o privately negotiated transactions;
o short sales, but, if at all, only after the effectiveness of the
Registration Statement and the approval for listing by the American
Stock Exchange of the shares of common stock offered hereby;
o broker-dealers may agree with the selling security holders to sell a
specified number of such shares at a stipulated price per share;
o a combination of any such methods of sale; and
o any other method permitted pursuant to applicable law.
The selling security holders may also sell shares under Rule 144 under
the Securities Act of 1933, as amended (the "Securities Act"), if available,
rather than under this prospectus.
The selling security holders may also engage in short sales against the
box, puts and calls and other transactions in our securities or derivatives of
our securities and may sell or deliver shares in connection with these trades.
The selling security holders may pledge their shares to their brokers under the
margin provisions of customer agreements. If a selling stockholder defaults on a
margin loan, the broker may, from time to time, offer and sell the pledged
shares. We believe that the selling security holders have not entered into any
agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their shares other than ordinary course
brokerage arrangements, nor is there an underwriter or coordinating broker
acting in connection with the proposed sale of shares by the selling security
holders.
Broker-dealers engaged by the selling security holders may arrange for
other brokers-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the selling security holders (or, if any
broker-dealer acts as agent for the purchaser of shares, from the purchaser) in
amounts to be negotiated. The selling security holders do not expect these
commissions and discounts to exceed what is customary in the types of
transactions involved.
Selling security holders and any broker-dealers or agents that are
involved in selling the shares may be deemed to be "underwriters" within the
meaning of the Securities Act in connection with such sales. In such event, any
commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act. If the selling security
holders are deemed to be underwriters, the selling security holders may be
subject to certain statutory and regulatory liabilities, including liabilities
imposed pursuant to Sections 11, 12 and 17 of the Securities Act and Rule 10b-5
under the Exchange Act.
19
We are required to pay all fees and expenses incident to the
registration of the shares. Otherwise, all discounts, commissions or fees
incurred in connection with the sale of the common stock offered hereby will be
paid by the selling security holders.
Upon our being notified by a selling stockholder that any material
arrangement has been entered into with a broker-dealer for the sale of shares
through a block trade, special offering, exchange distribution or secondary
distribution or a purchase by a broker or dealer, a supplement to this
prospectus will be filed, if required, pursuant to Rule 424(b) under the
Securities Act, disclosing (i) the name of each such selling stockholder and of
the participating broker-dealer(s), (ii) the number of shares involved, (iii)
the price at which such shares were sold, (iv) the commissions paid or discounts
or concessions allowed to such broker-dealer(s), where applicable, (v) that such
broker-dealer(s) did not conduct any investigation to verify the information set
out or incorporated by reference in this prospectus, and (vi) other facts
material to the transaction.
In order to comply with the securities laws of certain states, if
applicable, the shares will be sold in such jurisdictions, if required, only
through registered or licensed brokers or dealers. In addition, in certain
states the shares may not be sold unless the shares have been registered or
qualified for sale in such state or an exemption from registration or
qualification is available and complied with.
We advised the selling security holders that the anti-manipulative
provisions of Regulation M promulgated under the Exchange Act may apply to their
sales of the shares offered hereby.
INDEMNIFICATION OF OFFICERS AND DIRECTORS
Section 145 of the General Corporation Law of the State of Delaware
(the "DGCL") provides, in general, that a corporation incorporated under the
laws of the State of Delaware, such as the registrant, may indemnify any person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding (other than a derivative action
by or in the right of the corporation) by reason of the fact that such person is
or was a director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such action, suit or proceeding if such person
acted in good faith and in a manner such person reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe such person's
conduct was unlawful. In the case of a derivative action, a Delaware corporation
may indemnify any such person against expenses (including attorneys' fees)
actually and reasonably incurred by such person in connection with the defense
or settlement of such action or suit if such person acted in good faith and in a
manner such person reasonably believed to be in or not opposed to the best
interests of the corporation, except that no indemnification will be made in
respect of any claim, issue or matter as to which such person will have been
adjudged to be liable to the corporation unless and only to the extent that the
Court of Chancery of the State of Delaware or any other court in which such
action was brought determines such person is fairly and reasonably entitled to
indemnity for such expenses.
Our Certificate of Incorporation and Bylaws provide that we shall
indemnify our directors, and officers, employees and agents to the extent and in
the manner permitted by the provisions of the laws of the State of Delaware, as
amended from time to time, subject to any permissible expansion or limitation of
such indemnification, as may be set forth in any stockholders' or directors'
resolution or by contract.
20
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling Ramp pursuant
to the foregoing provisions, we have been informed that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.
WHERE YOU CAN FIND MORE INFORMATION ABOUT US
We file reports, proxy statements, information statements and other
information with the SEC. You may read and copy this information, for a copying
fee, at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington,
D.C. 20549. Please call the SEC at 1-800-SEC-0330 for more information on its
public reference rooms. Our SEC filings are also available to the public from
commercial document retrieval services, from the American Stock Exchange and at
the web site maintained by the SEC at http://www.sec.gov.
We have filed the Registration Statement under the Securities Act, with
respect to the securities offered pursuant to this prospectus. This prospectus
does not contain all of the information set forth in the Registration Statement,
certain parts of which are omitted in accordance with the rules and regulations
of the Commission. For further information, reference is made to the
Registration Statement and the exhibits filed as a part thereof, which may be
found at the locations and website referred to above.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The Securities and Exchange Commission (the "SEC") allows us to
"incorporate by reference" into this prospectus the information we file with the
SEC, which means that we can disclose important information to you by referring
to those documents. The information incorporated by reference is an important
part of this prospectus. We incorporate by reference the following documents we
filed with the SEC:
o Our Annual Report on Form 10-K for the fiscal year ended December
31, 2002;
o Our Quarterly Report on Form 10-Q for the quarterly period ended
March 31, 2003;
o Our Quarterly Report on Form 10-Q for the quarterly period ended
June 30, 2003;
o Our Quarterly Report on Form 10-Q for the quarterly period ended
September 30, 2003;
o Our Current Report on Form 8-K, filed January 14, 2003;
o Our Current Report on Form 8-K, filed January 29, 2003;
o Our Current Report on Form 8-K, filed February 6, 2003;
o Our Current Report on Form 8-K, filed February 13, 2003;
o Our Current Report on Form 8-K, filed February 13, 2003;
o Our Current Report on Form 8-K, filed March 7, 2003;
o Our Current Report on Form 8-K, filed March 18, 2003;
o Our Current Report on Form 8-K, filed April 15, 2003;
o Our Current Report on Form 8-K, filed June 9, 2003;
o Our Current Report on Form 8-K, filed June 10, 2003;
o Our Current Report on Form 8-K, filed June 26, 2003, as amended by
Current Report on Form 8-K/A, filed September 4, 2003;
o Our Current Report on Form 8-K, filed July 1, 2003;
o Our Current Report on Form 8-K, filed July 10, 2003;
o Our Current Report on Form 8-K, filed July 28, 2003;
o Our Current Report on Form 8-K, filed August 12, 2003;
o Our Current Report on Form 8-K, filed August 22, 2003;
21
o Our Current Report on Form 8-K, filed September 2, 2003;
o Our Current Report on Form 8-K, filed September 10, 2003;
o Our Current Report on Form 8-K, filed October 17, 2003;
o Our Current Report on Form 8-K, filed November 10, 2003;
o Our Current Report on Form 8-K, filed November 19, 2003;
o Our Current Report on Form 8-K, filed December 11, 2003;
o Our Current Report on Form 8-K, filed December 11, 2003;
o Our Current Report on Form 8-K, filed December 18, 2003;
o Our Current Report on Form 8-K, filed December 23, 2003;
o Our Current Report on Form 8-K, filed December 24, 2003;
o Our Current Report on Form 8-K/A, filed January 26, 2004;
o Our Definitive Proxy Statement to Shareholders, dated April 4, 2003;
and
o Our Definitive Proxy Statement to Shareholders, dated November 6,
2003.
We are also incorporating by reference additional documents that we may
file with the Commission under Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act prior to the termination of this offering.
If you are a stockholder, we may have sent you some of the documents
incorporated by reference, but you can obtain any of them through the Commission
or us. Documents incorporated by reference are available from us without charge,
except exhibits, unless we have specifically incorporated by reference an
exhibit into a document that this prospectus incorporates. Stockholders may
obtain documents incorporated by reference into this prospectus by requesting
them in writing or by telephone from:
Ramp Corporation
Investor Relations
The Graybar Building
420 Lexington Ave., Suite 1830
New York, New York 10170
(212) 697-2509
LEGAL MATTERS
The validity of the shares of common stock offered hereby will be
passed upon for us by Jenkens & Gilchrist Parker Chapin LLP, 405 Lexington
Avenue, New York, New York.
EXPERTS
Our consolidated financial statements as of December 31, 2002 and 2001,
and for each of the three years in the period ended December 31, 2002 appearing
in our 2002 Form 10-K have been audited by Ehrhardt Keefe Steiner & Hottman PC,
independent auditors, as stated in their report appearing therein, and have been
incorporated herein by reference in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.
The financial statements of The Duncan Group, Inc. (d/b/a Frontline
Physicians Exchange) as of and for the years ended December 31, 2002 and 2001,
appearing in our current report on Form 8-K/A, filed on January 26, 2004, were
audited by BDO Seidman, LLP, independent auditors, as stated in their report
appearing therein, and have been incorporated herein by reference in reliance
upon the report of such firm given upon their authority as experts in accounting
and auditing.
22
================================================== ======================================================
We have not authorized any dealer,
salesperson or any other person to give any
information or to represent anything other than
those contained in this prospectus in connection
with the offer contained herein, and, if given
or made, you should not rely upon such
information or representations as having been
authorized by Ramp Corporation. This prospectus 18,872,199
does not constitute an offer of any securities SHARES OF COMMON STOCK
other than those to which it relates or an offer
to sell, or a solicitation of an offer to buy,
those to which it relates in any state to any
person to whom it is not lawful to make such
offer in such state. The delivery of this
prospectus at any time does not imply that the
information herein is correct as of any time
after the date of this prospectus. RAMP CORPORATION
TABLE OF CONTENTS
Page
----
Prospectus Summary...............................3
Risk Factors.....................................4
Forward-Looking Statements ......................9
Use of Proceeds..................................9
Description of the Transactions.................10
Selling Stockholders ...........................12 ------------
Description of Securities.......................14
Plan of Distribution ...........................19 PROSPECTUS
Indemnification of Officers and
Directors.......................................20 ------------
Where You Can Find More
Information About Us............................21
Incorporation of Certain Information
By Reference....................................21
Legal Matters...................................22
Experts ........................................22 January 29, 2004
================================================== ======================================================
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following is a list of the estimated expenses to be incurred by the
Registrant in connection with the issuance and distribution of the shares being
registered hereby.
Securities and Exchange Commission registration fee. $ 1,888.97
Printing and engraving expenses. 1,000.00
Legal fees and expenses. 25,000.00
Accounting fees and expenses. 5,000.00
Transfer Agent and Trustee fees and expenses. 1,000.00
Miscellaneous. 20,000.00
-----------
Total. $ 53,888.97
------------
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware
(the "DGCL") provides, in general, that a corporation incorporated under the
laws of the State of Delaware, such as the registrant, may indemnify any person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding (other than a derivative action
by or in the right of the corporation) by reason of the fact that such person is
or was a director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such action, suit or proceeding if such person
acted in good faith and in a manner such person reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe such person's
conduct was unlawful. In the case of a derivative action, a Delaware corporation
may indemnify any such person against expenses (including attorneys' fees)
actually and reasonably incurred by such person in connection with the defense
or settlement of such action or suit if such person acted in good faith and in a
manner such person reasonably believed to be in or not opposed to the best
interests of the corporation, except that no indemnification will be made in
respect of any claim, issue or matter as to which such person will have been
adjudged to be liable to the corporation unless and only to the extent that the
Court of Chancery of the State of Delaware or any other court in which such
action was brought determines such person is fairly and reasonably entitled to
indemnity for such expenses.
Our Certificate of Incorporation and Bylaws provide that we shall
indemnify our directors, and officers, employees and agents to the extent and in
the manner permitted by the provisions of the laws of the State of Delaware, as
amended from time to time, subject to any permissible expansion or limitation of
such indemnification, as may be set forth in any stockholders' or directors'
resolution or by contract.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling Ramp pursuant
to the foregoing provisions, we have been informed that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.
II-1
ITEM 16. EXHIBITS.
Exhibit
Number Description
------- -----------
3.1 Certificate of Designation for the Series A Convertible
Preferred Stock.
4.1 Series A Convertible Preferred Stock Purchase Agreement, dated
December 31, 2003, relating to the sale of Series A
Convertible Preferred Stock by and between the Company and
Canon Ventures Limited ("Canon").
4.2 Form of Warrant issued to Canon at an exercise price of $0.70
cents.
4.3 Form of Warrant issued to Canon at an exercise price of $0.61
cents.
4.4 Form of Warrant issued to vFinance Investments, Inc. at an
exercise price of $0.61 cents.
4.5 Form of Warrant issued to David Stefansky at an exercise price
of $0.61 cents.
4.6 Form of Warrant issued to Richard Rosenblum at an exercise
price of $0.61 cents.
4.7 Asset Purchase Agreement, dated November 7, 2003, by and
between the Company and The Duncan Group, Inc. (incorporated
by reference to Exhibit 99.1 to the Company's Form 8-K filed
November 19, 2003).
4.8 Registration Rights Agreement, dated November 3, 2003, by and
between the Company and The Duncan Group, Inc. (incorporated
by reference to Exhibit 4.1 to the Company's Form 8-K filed
November 19, 2003).
4.9 Registration Rights Agreement, dated December 31, 2003, by and
between the Company and Canon Ventures Limited.
4.10 Consulting Agreement, dated as of October 1, 2002, by and
between the Company and Mr. Benjamin Mayer, as amended on
December 4, 2003.
4.11 Form of Warrant issued to Mayer & Associates LLC at an
exercise price of $0.61 cents.
4.12 Form of Warrant issued to Mayer & Associates LLC at an
exercise price of $0.30 cents.
4.13 Form of Stock Purchase Agreement and Warrant issued to each of
the investors in connection with the private placement.
5.1 Opinion of Jenkens & Gilchrist Parker Chapin LLP.
23.1 Consent of Ehrhardt Keefe Steiner & Hottman PC.
23.2 Consent of BDO Seidman, LLP.
23.3 Consent of Jenkens & Gilchrist Parker Chapin LLP (included in
Exhibit 5.1).
24.1 Power of Attorney (included on signature page).
II-2
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement:
(a) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933,
(b) To reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the
total dollar value of securities offered would not
exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the
effective Registration Statement,
(c) To include any material information with respect to
the plan of distribution not previously disclosed in
the Registration Statement or any material change to
such information in the Registration Statement;
provided, however, that clauses (a) and (b) do not
apply if the information required to be included in a
post-effective amendment by such clauses is contained
in periodic reports filed with or furnished to the
Securities and Exchange Commission by the Registrant
pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in
the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed a new registration statement relating to the securities
offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of the Registrant's annual report
pursuant to Section 13(a) or Section 15(d) of the Exchange Act
that is incorporated by reference in this Registration
Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
II-3
Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers and controlling persons of the Registrant
pursuant to the provisions described under Item 15 above, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities, other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding, is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of
prospectus filed as part of this Registration Statement in
reliance upon Rule 430A and contained in a form of prospectus
filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of
this Registration Statement as of the time it was declared
effective.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that
contains a form of prospectus shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act
of 1933, each filing of the Registrant's annual report
pursuant to section 13(a) or section 15(d) of the Exchange Act
(and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Exchange
Act) that is incorporated by reference in the Registration
Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement on Form S-3 to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of New York, State of New York, on January 29,
2004.
RAMP CORPORATION
By: /s/ Darryl R. Cohen
-----------------------------
Darryl R. Cohen
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears below in so signing also makes, constitutes and appoints
Darryl R. Cohen and Andrew Brown his or her true and lawful attorney-in-fact and
agent, with full power of substitution and resubstitution, for him or her and in
his or her name, place, and stead, in any and all capacities, to sign and file
Registration Statement(s) and any and all pre- or post-effective amendments to
such Registration Statement(s), with all exhibits thereto and hereto, and other
documents with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent, and each of them, full power and authority to do and
perform each and every act and thing requisite or necessary to be done in and
about the premises, as fully to all intents and purposes as he or she might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their or his substitutes, may
lawfully do or cause to be done by virtue hereof.
Signature Title Date
--------- ----- ----
/s/ Darryl R. Cohen Chairman, Chief Executive Officer and Director January 29, 2004
--------------------- (Principal Executive Officer)
Darryl R. Cohen
/s/ Mitchell Cohen Chief Financial Officer, Executive Vice President January 29, 2004
--------------------- and Secretary (Principal Financial and Accounting Officer)
Mitchell Cohen
/s/ Andrew Brown President and Director January 29, 2004
---------------------
Andrew Brown
/s/ David Friedensohn Director January 29, 2004
---------------------
David Friedensohn
/s/ Samuel H. Havens Director January 29, 2004
---------------------
Samuel H. Havens
/s/ J.d. Kleinke Director January 29, 2004
---------------------
J.D. Kleinke
/s/ Jeffrey A. Stahl Director January 29, 2004
---------------------
Jeffrey A. Stahl
II-5
EXHIBIT INDEX
Exhibit
Number Description
------- -----------
3.1 Certificate of Designation for the Series A Convertible
Preferred Stock.
4.1 Series A Convertible Preferred Stock Purchase Agreement, dated
December 31, 2003, relating to the sale of Series A
Convertible Preferred Stock by and between the Company and
Canon Ventures Limited ("Canon").
4.2 Form of Warrant issued to Canon at an exercise price of $0.70
cents.
4.3 Form of Warrant issued to Canon at an exercise price of $0.61
cents.
4.4 Form of Warrant issued to vFinance Investments, Inc. at an
exercise price of $0.61 cents.
4.5 Form of Warrant issued to David Stefansky at an exercise price
of $0.61 cents.
4.6 Form of Warrant issued to Richard Rosenblum at an exercise
price of $0.61 cents.
4.7 Asset Purchase Agreement, dated November 7, 2003, by and
between the Company and The Duncan Group, Inc. (incorporated
by reference to Exhibit 99.1 to the Company's Form 8-K filed
November 19, 2003).
4.8 Registration Rights Agreement, dated November 3, 2003, by and
between the Company and The Duncan Group, Inc. (incorporated
by reference to Exhibit 4.1 to the Company's Form 8-K filed
November 19, 2003).
4.9 Registration Rights Agreement, dated December 31, 2003, by and
between the Company and Canon Ventures Limited.
4.10 Consulting Agreement, dated as of October 1, 2002, by and
between the Company and Mr. Benjamin Mayer, as amended on
December 4, 2003.
4.11 Form of Warrant issued to Mayer & Associates LLC at an
exercise price of $0.61 cents.
4.12 Form of Warrant issued to Mayer & Associates LLC at an
exercise price of $0.30 cents.
4.13 Form of Stock Purchase Agreement and Warrant issued to each of
the investors in connection with the private placement.
5.1 Opinion of Jenkens & Gilchrist Parker Chapin LLP.
23.1 Consent of Ehrhardt Keefe Steiner & Hottman PC.
23.2 Consent of BDO Seidman, LLP.
23.3 Consent of Jenkens & Gilchrist Parker Chapin LLP (included in
Exhibit 5.1).
24.1 Power of Attorney (included on signature page).
II-6