Softlock.com, Inc. - SoftLock believes that this process, as an...

Softlock.com, Inc. - Recent Material Event

Item 1. Legal Proceedings), SoftLock had considered a Chapter 11 reorganization or Chapter 7 liquidation proceeding, as the forum to maintain the status quo among the creditors and stockholders as well as the vehicle in which to market and liquidate the remaining assets and distribute the net proceeds to the creditors and the stockholders. Currently, the Court's Order provides SoftLock with a procedure to market, sell or license the remaining assets pursuant to a similar procedure to that used in a bankruptcy proceeding.

SoftLock believes that this process, as an alternative to a bankruptcy, will accomplish many of the same objectives for the creditors and stockholders under a much shorter time schedule and, in all likelihood, at less administrative expense. Upon the creditors' valid claims being paid in full, any balance will be distributed to stockholders. Although the Company's present plans are to proceed with a sale outside of bankruptcy, no assurance can be given that the Company will not choose to seek protection of the bankruptcy laws.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Other than as set forth below, the Company is not a party to any legal proceedings which management believes to be material, and there are no such proceedings which are known to be contemplated for which the Company anticipates a material risk of loss.

On June 26, 2006, litigation was commenced in the Superior Court of Massachusetts, Middlesex County, Cambridge Division (the "Court") against the Company's subsidiary SoftLock Services, Inc. ("SoftLock"). The claim was brought by SoftLock's landlord, Wellesley/Rosewood Maynard Mills Ltd. Partnership, seeking to recover past due rental payments. On August 3, 2006, the Court issued an Order regarding the sale of SoftLock's assets in which SoftLock is restrained from selling or transferring in any manner, other than in the ordinary course of business, any and all of its assets without prior Order of the Court and it was further ordered that SoftLock shall locate a purchaser and negotiate the terms of any proposed sale. It was further ordered that prior to the proposed sale SoftLock shall file a Motion to Approve a sale, setting forth certain information, documentation, statement of marketing efforts and opinion of value. Upon the Court's satisfaction of certain conditions being met, a hearing will be held to approve the sale.

The Company is subject to this and other litigation from time to time in the ordinary course of business.

ITEM 2. CHANGES IN SECURITIES

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

31.1

Certification under Section 302 of the Sarbanes-Oxley Act of 2002 for Chief Executive Officer.

31.2

Certification under Section 302 of the Sarbanes-Oxley Act of 2002 for Chief Financial Officer.

32.1

Certification by the Chief Executive and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(b) Reports on Form 8-K

None.

SIGNATURES

In accordance with the requirements of the Exchange Act, the Company caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.