SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): March 31, 2005
ION NETWORKS, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 000-13117 22-2413505
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(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.
120 Corporate Boulevard
South Plainfield, New Jersey 07080
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(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (908) 546-3900
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(Former Name or Former Address, if Changed Since Last Report)
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
ITEM 3.02. UNREGISTERED SALES OF EQUITY SECURITIES.
On March 31, 2005, Ion Networks, Inc. ("Ion") entered into a purchase
agreement with the New York based institutional investment firm Special
Situations Fund III, LP and several related funds (the "SSF Funds"), pursuant to
which Ion completed a private placement of 4,411,765 shares of common stock and
warrants to purchase an additional 2,205,882 shares of common stock. Certain of
the SSF Funds beneficially owned approximately 11% of Ion common stock prior to
the transaction. The total offering price was $750,000. The shares of common
stock were issued at $0.17 cents per share and the warrants are exercisable at a
price of $0.23 per share subject to certain anti-dilution adjustments. The
warrants will expire on March 30, 2010. Ion has the right to call the warrants
in the event that its common stock trades at a price exceeding $0.69 per share
for twenty (20) consecutive trading sessions. Ion also agreed to file a
registration statement, registering for resale the shares of common stock as
well as the shares issued upon exercise of the warrants, within 45 days from
March 31, 2005, and thereafter to use commercially reasonably efforts to cause
such registration statement to become effective as soon as practicable. Further
terms relating to this investment are described in the purchase agreement, form
of warrant and registration rights agreement set forth in the exhibits filed
with this Form 8-K.
The securities in this private placement were issued without
registration in reliance on Section 4(2) of the Securities Act of 1933, as
amended ("1933 Act"), as amended, and Rule 506 promulgated thereunder. The
exemption was established by the representation of each purchaser as to its
status as an accredited investor, that it was purchasing the securities for its
own account and not with a view to the resale or distribution of any part
thereof in violation of the 1933 Act and the acknowledgment by each purchaser
that resale of the securities may not be made unless registered under the 1933
Act, or another exemption is available. In addition, the securities bear a
legend indicating such restrictions on transferability.
On April 5, 2005, Ion issued a press release announcing the completion
of the private placement. The press release is attached to this filing as
Exhibit 99.1.
The information contained in this Form 8-K does not constitute an offer
of any securities for sale. In addition, the securities issued or issuable in
the transactions described above have not been registered under the 1933 Act and
may not be offered or sold in the United States absent registration or an
applicable exemption from registration requirements.
SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
4.1 Form of Warrant to Purchase Common Stock of Ion Networks, Inc.
10.1 Purchase Agreement between Ion Networks, Inc. and the Purchasers named
therein dated March 31, 2005.
10.2 Registration Rights Agreement between Ion Networks, Inc. and the
Investors named therein dated March 31, 2005.
99.1 Press Release of Ion Networks, Inc. issued April 5, 2005.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ION NETWORKS, INC.
Dated: April 5, 2005 By: /s/ Patrick Delaney
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Chief Financial Officer
EXHIBIT INDEX
EXHIBIT DESCRIPTION
4.1 Form of Warrant to Purchase Common Stock of Ion Networks, Inc.
10.1 Purchase Agreement between Ion Networks, Inc. and the Purchasers named
therein dated March 31, 2005.
10.2 Registration Rights Agreement between Ion Networks, Inc. and the
Investors named therein dated March 31, 2005.
99.1 Press Release of Ion Networks, Inc. issued April 5, 2005.