UNITED STATES
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): January 11, 2005
IPIX CORPORATION
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(Exact name of registrant as specified in its charter)
DELAWARE 000-26363 52-2213841
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(State or other (Commission (IRS Employer
jurisdiction of incorporation) File Number) Identification Number)
3160 Crow canyon road, san ramon, california 94583
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (925) 242-4002
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N/A
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On January 11, 2005, IPIX Corporation entered into an asset purchase
agreement (the "Asset Purchase Agreement") with AdMission, Inc., a privately
held Delaware corporation ("AdMission") in which IPIX agreed to sell to
AdMission certain of its assets (including certain patent rights and other
intellectual property) and contracts relating to its IPIX AdMission
business unit (the "AdMission Business"). In consideration for the sale, IPIX
will receive 1,035,000 shares of the Series A Convertible Preferred Stock of
AdMission and a warrant to purchase 200,000 shares of the Common Stock of
AdMission. Additionally, AdMission will assume certain liabilities associated
with the AdMission Business. Sarah Pate, IPIX's former Executive Vice President
and General Manager of IPIX AdMission, will become the President and Chief
Executive Officer of AdMission. A copy of the Asset Purchase Agreement is filed
as Exhibit 10.1 to this Form 8-K. A copy of the Patent Transfer, License and
Repurchase Agreement and the IPIX Trademark/Service Mark License Agreement both
to be entered into by and between the Company and AdMission, Inc. upon the
closing of transactions contemplated by the Asset Purchase Agreement, are filed
with this Form 8-K as Exhibit 10.2 and Exhibit 10.3. A copy of the press
release related to IPIX's announcement of the transaction is attached to this
Form 8-K as Exhibit 99.1.
In connection with the execution of the asset purchase agreement, IPIX
accelerated the vesting of 264,609 options held by employees of the IPIX
AdMission division who are transferring to AdMission, which options became
exercisable on January 11, 2005. This amount included 50,000 options held by
Ms. Pate.
Subject to the satisfaction of certain closing conditions, the transaction is
expected to close on or about February 2, 2005.
ITEM 2.05. COSTS ASSOCIATED WITH EXIT OR DISPOSAL ACTIVITIES.
Assuming completion of the sale of the AdMission Business as described in
Item 1.01 above, which disclosure is incorporated into this Item 2.05 by
reference, IPIX will incur exit costs related to the disposal of this business.
In addition, IPIX will relocate its principal office to Vienna, Virginia and
will close its office in San Ramon, California. The office relocation and
closure are expected to occur during the first calendar quarter of 2005.
IPIX estimates that it will incur costs of approximately $3.3 million in
connection with the sale of the AdMission Business and the closing of its San
Ramon office. These costs include approximately $1.5 million in lease
termination costs, $0.5 million in asset disposal costs, $0.5 million in
severance expenses and $0.8 million associated with the accelerated vesting of
options held by transferred employees.
Approximately $2.5 million of these charges will be cash expenditures and
approximately $0.8 million of the costs associated with the accelerated options
represent non-cash charges. All of the charges are expected to be incurred
during the first quarter of 2005.
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ITEM 5.02. DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS.
On January 11, 2005, Sarah Pate resigned as Executive Vice President and
General Manager of IPIX AdMission and as an employee of IPIX in order to assume
the position as President and Chief Executive Officer of AdMission, Inc.
On January 11, 2005, after the Company had issued its press release relating
to sale of its AdMission Business, Paul Farmer submitted a letter of resignation
as Chief Financial Officer, Executive Vice President, Secretary and Treasurer of
the Company because he does not plan to relocate to IPIX's new principal
corporate office in Virginia. His resignation has been accepted by IPIX and
will be effective on January 21, 2005. A copy of the Company's press release
dated January 17, 2005 announcing Mr. Farmer's resignation is attached to this
current report as Exhibit 99.2. IPIX has commenced a search for a replacement
for Mr. Farmer and expects to appoint a successor as soon as practicable. Kara
Brand, the Company's Controller, will serve as the interim Chief Financial
Officer, Treasurer and Secretary of the Company.
ITEM 8.01. OTHER EVENTS.
On January 11, 2005, IPIX issued a press release announcing the sale of its
AdMission Business. A copy of the Company's press release is attached hereto as
Exhibit 99.1.
On January 17, 2005 IPIX issued a press release announcing the resignation of
its Chief Financial Officer and the appointment of Kara Brand as interim Chief
Financial Officer. A copy of the Company's press release is attached hereto
as Exhibit 99.2.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
Filed as Exhibit 10.1 is a copy of the Asset Purchase Agreement. Also
furnished, as Exhibit 10.2 and Exhibit 10.3, are the Patent Transfer, License
and Repurchase Agreement and the IPIX Trademark/Service Mark License Agreement,
both to be entered into by and between the Company and AdMission, Inc. upon the
closing of the transactions contemplated by the Asset Purchase Agreement.
Furnished as Exhibit 99.1 is a copy of the Company's press release issued on
January 11, 2005 announcing the sale of the Company's AdMission Business, the
resignation of Ms. Pate from the Company and the intention of Mr. Farmer not to
continue as the Company's CFO because of the Company's relocation to new
corporate headquarters in Virginia.
Furnished as Exhibit 99.2 is a copy of the Company's press release issued on
January 17, 2005 announcing the resignation of Mr. Farmer and the appointment of
Ms. Brand as interim Chief Financial Officer.
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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.
IPIX CORPORATION
Dated: January 17, 2005 /s/ Clara M. Conti
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Clara M. Conti
President and Chief Executive Officer