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As filed with the Securities and Exchange Commission on November 18, 1999
Registration No. 333-88171
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 2 TO
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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INTERVU INC.
(Exact name of registrant as specified in its charter)
DELAWARE 33-0680870
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification Number)
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6815 Flanders Drive
San Diego, California 92121
(619) 623-8400
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
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Agent for Service: Copies to:
Harry E. Gruber Scott N. Wolfe, Esq.
Chief Executive Officer Robert E. Burwell, Esq.
INTERVU Inc. Latham & Watkins
6815 Flanders Drive 701 B Street, Suite 2100
San Diego, California 92121 San Diego, California 92101
(619) 623-8400 (619) 236-1234
Approximate date of commencement of proposed sale to the public: From time to
time after the effective date of this Registration Statement.
If the only securities being registered 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. [ ]
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CALCULATION OF REGISTRATION FEE
<TABLE>
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PROPOSED
PROPOSED MAXIMUM
AMOUNT MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE OFFERING PRICE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED PER SHARE (1) PRICE(1) FEE(1)
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<S> <C> <C> <C> <C>
Common Stock, par value $.001 per share 1,935,192 $32.50 $65,154,993 $18,114
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(1) A fee in the amount of $18,114 was previously paid. This fee was
calculated pursuant to Rule 457, based on 2,004,769 shares and a per share
price of $32.50, the average of the high and low prices of the common stock
as reported on the Nasdaq National Market on September 23, 1999.
A portion of the shares covered by this Registration Statement are issuable
pursuant to outstanding warrants and outstanding shares of convertible
preferred stock, the terms of which provide for a change in the number of
shares issuable thereunder in the event of a stock split and in certain other
events. Pursuant to Rule 416(b) under the Securities Act of 1933, any greater
or lesser number of shares resulting from any adjustment of the number of
shares issuable pursuant to such warrants are covered by this Registration
Statement.
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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 the Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
<PAGE> 3
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the SEC is
effective. This prospectus is not an offer to sell these securities and it is
not a solicitation of an offer to buy these securities in any state where the
offer or sale is not permitted.
SUBJECT TO COMPLETION--DATED NOVEMBER 18, 1999
PROSPECTUS
1,935,192 SHARES
INTERVU INC.
COMMON STOCK
----------------
This prospectus relates to up to 1,942,369 shares of our common stock,
par value $.001 per share, which may be offered for sale by the selling
stockholders listed in this prospectus. The shares of common stock being offered
were previously issued to the selling stockholders, are issuable upon the
exercise of warrants previously issued to selling shareholders or are issuable
upon conversion of shares of our Series G preferred stock previously issued to
one of the selling stockholders. Shares of common stock may be sold from time to
time by the selling stockholders directly or through one or more broker-dealers,
in one or more transactions on the Nasdaq National Market, in the
over-the-counter market, in negotiated transactions or otherwise, at prices
related to the prevailing market prices or at negotiated prices. We will not
receive any of the proceeds from the sale of the shares of common stock. We will
bear all expenses of the offering of the common stock, except that the selling
stockholders will pay any applicable underwriting fees, discounts or commissions
and transfer taxes, as well as the fees and disbursements of their counsel and
experts.
Our common stock is listed on the Nasdaq National Market under the
symbol ITVU. On November 16, 1999 the last reported sale price for our common
stock as reported on the Nasdaq National Market was $64.75 per share.
SEE "RISK FACTORS" ON PAGES 3 TO 8 FOR FACTORS THAT YOU SHOULD CONSIDER
BEFORE INVESTING IN THE SHARES OF INTERVU.
-----------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.
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The date of this prospectus is __________, 1999.
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The terms "INTERVU," "we," "our," and "us" refer to InterVU Inc., a
Delaware corporation. All references in this prospectus to "common stock" refer
to our common stock, par value $.001 per share.
INTERVU
We provide Web site owners and content publishers with cost-effective
solutions and automated features for the streaming of live and on-demand video
and audio content over the Internet. Streaming media technology allows the
delivery of a continuous flow of video and audio content over the Internet to
end-users. Our customers use our video and audio distribution services to
transmit entertainment, sports, news, business to business, advertising and
distance learning content. Our current customers include Bloomberg, CNN, House
of Blues, Intel, Microsoft, MovieFone, MSNBC, NBC, OnRadio, RadioWave.com,
Saatchi and Saatchi and Turner Broadcasting.
We are a full-service provider, offering all of the services necessary
for both live Webcasting and video and audio on-demand. We have developed
software solutions that automate the publishing, distribution and programming of
video and audio content. Our scalable, patent-pending distribution network,
comprised of servers strategically located in major Internet hosting centers,
also enhances our ability to provide streaming video and audio services to our
customers. In addition, we offer advanced data management services that enable
our customers to manage video and audio files and better tailor content to meet
end-user demand. We typically charge our customers monthly fees based on the
particular bundle of services to be provided and the amount of video and audio
content to be stored and delivered.
Our objective is to establish ourselves as the leading service provider
for Internet video and audio distribution solutions. Our strategy for achieving
this goal includes:
- targeting leading Web sites and content publishers,
- designing our service solutions to drive traffic to our
customers' Web sites,
- developing additional automated publishing, promotion and
reporting solutions,
- providing full-services for our customers' live and on-demand
video and audio delivery needs and
- expanding our network to further improve the speed, quality and
reliability of streaming video and audio.
We were incorporated in Delaware in August 1995 and commenced operations
in December 1996. Our principal executive offices are located at 6815 Flanders
Drive, San Diego, California 92121. Our telephone number is (619) 623-8400.
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RISK FACTORS
You should carefully consider the following risk factors, in addition to
the other information included in this prospectus, before purchasing shares of
common stock of INTERVU. Each of these risks could adversely affect our
business, operating results and financial condition, as well as adversely affect
the value of an investment in our common stock.
WE HAVE A LIMITED OPERATING HISTORY ON WHICH TO BASE AN EVALUATION OF OUR
BUSINESS AND PROSPECTS
INTERVU was incorporated in August 1995 and launched the INTERVU Network
in December 1996. INTERVU did not emerge from the development stage until 1998.
Accordingly, we have a limited operating history on which to base an evaluation
of our business and prospects. You must consider our prospects in light of the
risks and uncertainties encountered by companies in the early stages of
development, particularly companies in new and rapidly evolving markets such as
the delivery of video and audio over the Internet.
WE HAVE A HISTORY OF LOSSES AND ANTICIPATE FUTURE LOSSES
Since the formation of our business, we have incurred substantial net
losses. As of December 31, 1998, we had an accumulated deficit of $23.3 million.
As we continue to implement our growth strategy, we intend to spend significant
amounts on sales and marketing, research and development and general and
administrative activities. We expect that we generally will incur these costs in
advance of anticipated related revenues, which may further increase operating
losses in some periods. As a result of our expansion, we expect to continue to
incur significant operating losses and negative cash flows from operations for
the next several years. It is possible that we may never achieve favorable
operating results or profitability.
POTENTIAL FLUCTUATIONS IN OUR FINANCIAL RESULTS MAY IMPAIR THE TRADING PRICE OF
OUR COMMON STOCK
We expect our revenues and operating results to vary significantly from
quarter to quarter. As a result, quarter to quarter comparisons of our revenues
and operating results may not be meaningful and you should not rely on them as
indicators of future performance. In addition, due to our limited operating
history, we cannot predict our future revenues or results of operations
accurately. It is likely that in one or more future quarters our financial
results will fall below the expectations of analysts and investors. If this
happens, the trading price of our common stock would likely decrease. Many of
the factors that cause our quarter to quarter financial results to be
unpredictable are largely beyond our control.
These factors include:
- our ability to retain existing customers and attract a
significant number of new ones,
- the growth of the market for streaming media content over the
Internet,
- our ability to implement our growth strategy, especially our
sales and marketing efforts, and
- the introduction of new technologies and Internet services by us
and our competitors.
WE EXPECT TO INCUR A SIGNIFICANT NON-CASH CHARGE RELATING TO OUR NBC STRATEGIC
ALLIANCE THAT WILL ADVERSELY AFFECT OUR RESULTS OF OPERATIONS
Under the terms of our strategic alliance agreement with NBC, NBC
acquired shares of our Series G preferred stock, which, under some circumstances
must be returned to us. As the requirement to return shares to us lapses, we
must incur a non-cash charge for the fair value of those shares of Series G
preferred stock for which this requirement has lapsed. In January 1998, we
expensed $3.4 million for the then fair value of 680,000 shares of Series G
preferred stock and expect to expense the then fair value of the remaining
600,000 shares of Series G preferred stock during the fourth quarter of 1999.
This non-cash charge is expected to materially adversely affect our results of
operations in the period we recognize the expense, which could impair the price
of our common stock.
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OUR SPECIALIZED SERVICES MAY NOT BE WIDELY ADOPTED BY CUSTOMERS
Our services are highly specialized and are designed solely to meet Web
site owners' Internet video and audio delivery needs. If Internet-based content
incorporating streaming media technology does not become widely adopted by Web
site owners, it would materially harm our business and impair the price of our
common stock. The market for streaming media content on the Internet has only
recently developed, is rapidly evolving and historically has been limited.
Demand for streaming media content on the Internet must develop further in order
to offer significant revenue opportunities for video and audio distribution
service providers such as INTERVU.
Many of our customers may cease using our services either without notice
or upon short notice, including customers with which we have contracts. For
example, NBC may terminate its strategic alliance agreement with us for any
reason upon 90 days prior notice. If we were to lose customers that are well
known in their industry, it could impair our ability to retain customers and
attract new ones.
ANY FAILURE BY US TO MANAGE OUR GROWTH COULD ADVERSELY AFFECT OUR BUSINESS
We have rapidly expanded our operations since INTERVU was founded in
August 1995. Continued expansion of our business may place increasing strains on
our ability to manage our growth, including our ability to monitor operations,
bill customers, control costs and maintain effective quality controls. In
connection with the expansion of our operations, we have grown from 34 employees
on October 15, 1997 to 209 employees on September 15, 1999. We plan to
significantly expand our sales and marketing and research and development
activities, hire a significant number of additional employees, expand our
internal information, accounting and billing systems and establish additional
sales offices. In addition, we plan to expand the infrastructure of the INTERVU
Network by investing in additional software and hardware consisting primarily of
additional servers. In order to successfully manage our growth we must identify,
attract, motivate, train and retain highly skilled managerial, financial,
engineering, business development, sales and marketing and other personnel.
Competition for this type of personnel is intense. If we fail to manage our
growth effectively, it could materially harm our business and impair the price
of our common stock.
WE MAY FAIL TO KEEP PACE WITH RAPIDLY CHANGING TECHNOLOGIES
The Internet industry is characterized by rapidly changing technology,
evolving industry standards and frequent new product and service introductions.
These factors will require us to continually improve the performance, features
and reliability of our services and the INTERVU Network. We may not successfully
respond quickly or cost-effectively to these developments. We also may not
achieve widespread acceptance of our services before our competitors offer
products and services with speed, performance, features and quality similar to
or better than ours or that are more cost-effective than our services. In
addition, the widespread adoption of new technologies could require substantial
expenditures by us to modify or adapt our technology. Furthermore, new or
emerging technologies such as satellite transmission of content may reduce
demand for our services.
WE FACE SIGNIFICANT COMPETITION
The market for Internet-based services is relatively new, rapidly
evolving and highly competitive. Many of our competitors and potential
competitors have substantially greater financial, technical, managerial and
marketing resources, longer operating histories, greater name recognition and
more established relationships with content providers than we do. We face
substantial competition from (1) Internet service providers, (2) Web sites and
content publishers, (3) hardware and system vendors and (4) companies that
utilize other streaming technologies.
We currently compete to a large extent with Web site operators and
content publishers that employ in-house technical personnel to develop streaming
media technology and manage their streaming media. Our competitors also
currently include Broadcast.com, which recently was acquired by Yahoo!, and
RealNetworks. Since our business is dependent on the overall success of the
Internet as a communication medium, we also compete with traditional media such
as radio and television. We expect competition from these and other types of
competitors to increase significantly.
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WE RUN THE RISK OF SYSTEM FAILURES THAT COULD IMPAIR OUR ABILITY TO PROVIDE
SERVICE
Our success in marketing our services requires us to provide reliable
service. Our operations depend on our ability to protect our networks from
physical damage, power loss, capacity limitations, software defects and other
disruptive problems, many of which are beyond our control. Our ability to
provide reliable services also depends on the reliability of Internet service
providers and online service providers, which have in the past had operational
problems and experienced outages. We expect these problems and outages to
continue to occur periodically. Any failure to provide reliable service could
impair our customer satisfaction, lead to a loss of customers or increase our
costs, which could materially harm our business and impair the price of our
common stock.
OUR NETWORK MAY BE VULNERABLE TO COMPUTER VIRUSES AND SECURITY BREACHES
Security breaches or problems caused by computer viruses could adversely
affect our ability to provide services and could materially impair customer
acceptance of our services. The INTERVU Network may be vulnerable to
unauthorized access, computer viruses and other disruptive problems despite our
implementation of security measures. Computer viruses or problems caused by
third parties, such as hackers, could lead to interruptions, delays or
termination of service to our customers. To alleviate problems caused by
computer viruses or security breaches, we may have to interrupt, delay or cease
service to our customers, which could materially harm our business.
THE INTERNET MAY FAIL TO SUPPORT AN INCREASING NUMBER OF USERS
The wide-spread commercial use of the Internet is a relatively new
development. Critical issues regarding the stability of the Internet's
infrastructure remain unresolved. For example, the rapid rise in the number of
Internet users and increased transmission of multimedia content over the Web
continues to place increasing strains on the Internet's communications and
transmission infrastructures. If these trends continue it could lead to
significant declines in transmission speeds and reliability of the Internet,
reducing the usage of the Internet by businesses and individuals. The failure of
the Internet to support an increasing numbers of users could materially harm our
business and impair the price of our common stock.
WE MAY EXPERIENCE DIFFICULTIES IN INTEGRATING BUSINESSES, PRODUCTS AND
TECHNOLOGIES WE MAY ACQUIRE INTO OUR BUSINESS
As part of our growth strategy, we may acquire businesses, products and
technologies and enter into joint ventures and strategic relationships with
other companies. Any of these transactions would expose us to additional risks,
including:
- the difficulty of assimilating and integrating the operations of
the combined companies and retaining key personnel,
- the potential disruption of our ongoing business and
- the potential additional expenses associated with amortization
of acquired intangible assets, integration costs and
unanticipated liabilities or contingencies.
We do not have significant experience in the identification and
management of acquisitions. If we are unable to successfully address any of the
foregoing risks, it could materially harm our business and impair the price of
our common stock.
THE LOSS OF KEY PERSONNEL COULD HARM OUR BUSINESS
Given the early stage of development of our business, we depend on the
performance and efforts of our senior management team and other key employees.
If we lost the service of any members of our senior management or other key
employees it could materially harm our business and impair the price of our
common stock. Our senior management includes Harry E. Gruber, our chief
executive officer and chairman of the board, Brian Kenner, our vice president
and chief technology officer, Kenneth L. Ruggiero, our vice president and chief
financial officer, and Edward L. Huguez, our vice president and chief operating
officer. We do not have employment agreements with any of our officers or
employees.
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THE ENACTMENT OF NEW LAWS OR CHANGES IN GOVERNMENT REGULATIONS COULD ADVERSELY
AFFECT OUR BUSINESS
We are not currently required to comply with direct regulation by any
domestic or foreign governmental agency, other than regulations applicable to
businesses generally and laws or regulations directly applicable to the
Internet. However, due to the increasing popularity of the Internet, it is
possible that additional laws may be adopted regarding the Internet, any of
which could materially harm our business. The adoption of any additional laws
may decrease the growth of Internet use, which could lead to a decrease in the
demand for our services or increase the cost of doing business.
Although we do not actively program or edit the content on our network,
we could be held liable if customers use our network to distribute content
deemed to be indecent or obscene. While we do not actively market our services
to sites that host adult video content, one or more of our customers may in the
future use our services to transmit this type of content. The law relating to
liability for transmitting obscene or indecent material over the Internet
remains unsettled. The imposition of potential liability for materials
distributed through the Internet could require us to implement measures to
reduce our exposure to this liability. These measures may require the
expenditure of substantial resources or the discontinuation of some services,
which could materially harm our business and impair the price of our common
stock.
OUR INABILITY TO OBTAIN PATENT PROTECTION FOR OUR TECHNOLOGY OR MISAPPROPRIATION
OF OUR INTELLECTUAL PROPERTY COULD IMPAIR OUR COMPETITIVE POSITION
Our success depends on our internally developed technologies and other
intellectual property. We regard our technology as proprietary and attempt to
protect it with patents, copyrights, trade secret laws and confidentiality and
nondisclosure agreements. Despite these precautions, it may be possible for a
third party to obtain and use our services or technology without authorization.
Third parties also may develop similar technology independently.
We have applied for 28 United States and foreign patents. One of these
applications has issued in the United States, and we have received a notice of
allowance on another one of these applications. Some of these patents may not be
issued and, even if they are issued, they may not sufficiently protect our
technology. If any patents are not issued or if they fail to provide protection
to our technology, it may make it easier for our competitors to offer technology
equivalent or superior to ours. Moreover, we have applied for registration of a
number of key trademarks and service marks and intend to introduce new
trademarks and service marks. We may not be successful in obtaining registration
for one or more of these trademarks.
We may need to resort to litigation in the future to enforce or to
protect our intellectual property rights, including our patent and trademark
rights. In addition, our technologies and trademarks may be claimed to conflict
with or infringe upon the patent, trademark or other proprietary rights of third
parties. If this occurred, we would have to defend ourselves against the
challenge, which could result in substantial costs and the diversion of
resources. We also may have to obtain a license to use those proprietary rights
or possibly cease using those rights altogether. Any of these events could
materially harm our business and impair the price of our common stock.
YEAR 2000 PROBLEMS COULD DISRUPT OUR BUSINESS
Many software programs may not recognize calendar dates beginning in the
Year 2000. This problem could force computers or machines which utilize date
dependent software to either shut down or provide incorrect information. To
address this problem, we have examined our computer and information systems,
contacted our software and hardware providers, and, where necessary, made
upgrades to our systems.
Although we believe that the INTERVU Network and our software solutions
are Year 2000 compliant, undetected errors or defects may remain. Disruptions to
our business or unexpected costs may arise because of undetected errors or
defects in the technology and software we use to provide video and audio
delivery services to our customers and in our internal information systems.
Disruptions also may arise as a result of third parties not being Year 2000
compliant. If we, or any of our key suppliers, customers or Internet service
providers, fail to mitigate internal and external Year 2000 risks, we may
temporarily be unable to provide services or engage in other business
activities, including billing, which could have a material adverse effect on our
business.
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WE EXPECT TO EXPERIENCE VOLATILITY IN OUR STOCK PRICE
The market price of our common stock has fluctuated in the past and is
likely to continue to fluctuate in the future. In addition, the market prices of
securities of other technology companies, particularly Internet-related
companies, currently are highly volatile. Factors that may have a significant
effect on the market price of our common stock, many of which are beyond our
control, include:
- fluctuations in our operating results,
- analysts' reports and projections,
- changes in the market valuations of other Internet companies and
- announcements by us or our competitors relating to technological
innovations, new products or services, significant acquisitions,
strategic relationships or customer relationships.
Fluctuations in the market price of our common stock may in turn adversely
affect (1) our ability to complete any targeted acquisitions, (2) our access to
capital and financing and (3) our ability to attract and retain qualified
personnel. In the past, following periods of volatility in the market price of a
particular company's securities, securities class action litigation against that
company often results. We may become involved in this type of litigation in the
future. Litigation is often expensive and diverts management's attention and
resources, which could materially harm our business.
OUR EXECUTIVE OFFICERS AND DIRECTORS HAVE SUBSTANTIAL CONTROL OVER OUR VOTING
STOCK AND CAN MAKE DECISIONS THAT COULD ADVERSELY AFFECT OUR STOCK PRICE
As of September 15, 1999, our present executive officers and directors
and their affiliates beneficially owned approximately 23.7% of our outstanding
common stock. As a result, these stockholders will continue to significantly
influence our management and affairs and all matters requiring stockholder
approval, including the election of directors and approval of significant
corporate transactions, such as a merger, consolidation or sale of substantially
all of our assets.
WE HAVE IMPLEMENTED ANTI-TAKEOVER PROVISIONS THAT COULD PREVENT AN ACQUISITION
OF OUR BUSINESS AT A PREMIUM PRICE
Some of the provisions of our certificate of incorporation and bylaws
could discourage, delay or prevent an acquisition of our business at a premium
price. These provisions:
- permit the board of directors to increase its own size and fill
the resulting vacancies,
- provide for a board comprised of three classes of directors with
each class serving staggered three year terms,
- authorize the issuance of preferred stock in one or more series
and
- prohibit stockholder action by written consent.
In addition, Section 203 of the Delaware General Corporation Law also imposes
restrictions on mergers and other business combinations between us and any
holder of 15% or more of our common stock.
SALES OF SHARES ELIGIBLE FOR FUTURE SALE COULD IMPAIR OUR STOCK PRICE
The market price of our common stock could drop due to sales of a large
number of shares of our common stock or the perception that these sales could
occur. These factors could also make it more difficult to raise funds through
future offerings of common stock.
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As of September 20, 1999, 14,978,029 shares of common stock were
outstanding. The shares sold in this offering, 1,049,625 of which were
outstanding as of September 20, 1999 and 885,567 of which are issuable upon
conversion of preferred stock and upon the exercise of warrants, will be freely
tradeable without restrictions under the Securities Act, except for any shares
purchased by people who may be considered our affiliates under Rule 144 under
the Securities Act. In addition, the remaining 13,928,404 shares outstanding at
September 20, 1999 will otherwise be eligible for sale in the public market,
which includes shares of restricted stock that have not yet vested but will be
eligible for sale upon vesting. An additional 3,080,610 shares of common stock
are issuable upon the exercise of options, although a substantial number of our
options currently are not exercisable.
FORWARD-LOOKING STATEMENTS
This prospectus includes forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. We have based these forward-looking statements largely on
our current expectations and projections about future events and financial
trends affecting the financial condition of our business. These forward-looking
statements are subject to a number of risks, uncertainties and assumptions about
INTERVU, including:
- Our successful implementation of our growth strategy,
- Competition, including the introduction of new products or
services by our competitors,
- Anticipated trends in our business,
- Technological innovations,
- Fluctuations in our operating results,
- Future regulations affecting our business,
- Additions or departures of key personnel,
- General economic and business conditions, nationally, in our
markets and in our industry and
- Other risk factors described under "Risk Factors" in this
prospectus.
In addition, in this prospectus, the words "believe," "may," "will,"
"estimate," "continue," "anticipate," "intend," "expect" and similar
expressions, as they relate to INTERVU, our business or our management, are
intended to identify forward-looking statements.
We undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information or future
events. In light of these risks and uncertainties, the forward-looking events
and circumstances discussed in this prospectus may not occur and actual results
could differ materially from those anticipated or implied in the forward-looking
statements.
USE OF PROCEEDS
We are registering the shares of our common stock offered by this
prospectus for the account of the selling stockholders identified in the section
of this prospectus entitled "Selling Stockholders." All of the net proceeds from
the sale of our common stock by this prospectus will go to the stockholders who
offer and sell their shares of common stock. We will not receive any part of the
proceeds from the sale of these securities.
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SELLING STOCKHOLDERS
The following table provides the name of each selling stockholder and
the number of shares of our common stock offered by each selling stockholder
under this prospectus. Of the 1,935,192 shares of common stock listed below,
- 996,872 shares were issued to the former stockholders of
Netpodium Inc. upon the merger of Net Acquisition Corp., a
wholly owned subsidiary of INTERVU, with and into Netpodium and
7,177 shares are issuable upon exercise of warrants held by a
selling stockholder that were assumed by INTERVU in connection
with the Netpodium transaction;
- 38,399 shares were issued to the former stockholders of
VideoLinx Communications, Inc. upon the merger of VL Acquisition
Sub, Inc., a wholly owned subsidiary of INTERVU, with and into
VideoLinx;
- 149,000 shares are issuable upon the exercise of warrants issued
to the underwriters of INTERVU's first two public offerings,
which warrants were transferred to the selling stockholders
following the offerings; and
- 806,144 shares are issuable upon the conversion of shares of
Series G preferred stock issued to the National Broadcasting
Company, Inc. in connection with the formation of a strategic
alliance.
Pursuant to the terms of agreements between INTERVU and the selling
stockholders, INTERVU agreed to file a registration statement covering the
shares held by the selling stockholders with the Commission.
Because the selling stockholders may sell all or part of their shares of
our common stock under this prospectus and since this offering is not being
underwritten on a firm commitment basis, we cannot estimate the number and
percentage of shares of our common stock that the selling stockholders will hold
at the end of the offering covered by this prospectus.
<TABLE>
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NO. OF SHARES OF
COMMON STOCK
NAME INCLUDED IN OFFERING
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FORMER STOCKHOLDERS OF NETPODIUM INC.:
Tim Buckley 3,508
Wayne Burns 11,023
Jackie Fabbri 413
Brian Hilgendorf 57,822
Dianne Hofbeck 11,023
Inland Northwest Investors L.P.(1) 43,655
Intel Corporation 122,006*
Howard Johnson 2,704
Daniel Lipkie 5,391
Bill McAleer 2,704
Dave Moore 18,751
Northwest Venture Partners II, L.P.(1) 72,758
John O'Halloran 140,499
Primedia Ventures, Inc.(2) 114,829
Anne Seeley 2,921
Tom Simpson 976
Michael Templeman 85,381
Voyager Capital Fund I, L.P.(3) 152,481
Voyager Capital Founders' Fund I, L.P.(3) 8,279
Vulcan Ventures Incorporated(4) 129,936
Richard Ying 14,900
Keith Zentner 2,089
FORMER STOCKHOLDERS OF VIDEOLINX COMMUNICATIONS, INC.
Caribiner International, Inc.(5) 15,060
Jerry B. Landrum 14,469
Laura L. Hunt 8,870
</TABLE>
9
<PAGE> 12
<TABLE>
<S> <C>
WARRANTHOLDERS :
Randy F. Rock 22,260
Scott Weisman 2,800
WBM Ltd.(6) 114,400
William A. Relyea 9,540
HOLDER OF SERIES G PREFERRED STOCK:
National Broadcasting Company, Inc. 806,144
</TABLE>
* Includes 7,177 shares issuable upon exercise of warrants held by the selling
shareholder.
(1) Northwest Venture Associates, LLC is the investment manager for Inland
Northwest Investors L.P. and Northwest Venture Partners II, L.P. Thomas C.
Simpson is the President, and Jean J. Balek-Miner is the Vice President, of
Northwest Venture Associates, LLC.
(2) Primedia Ventures, Inc. is a subsidiary of PRIMEDIA Inc. Larry Phillips and
Andy Thompson are managing directors of Primedia Ventures, Inc. The executive
officers of Primedia Inc. are Tom Rogers, Charlie McCurdy and Beverly Chell.
(3) Voyager Capital Management, L.L.C. is the general partner of both Voyager
Capital Fund I, L.P. and Voyager Capital Founders' Fund I, L.P. The membership
interests in Voyager Capital Management, L.L.C. are held by Tony Audino,
Enrique Godreau III and Bill McAleer.
(4) Paul Allen is the President and Chairman of the Board of Vulcan Ventures
Incorporated and owns all of its capital stock.
(5) Caribiner International, Inc. is a publicly traded corporation.
(6) WBM Ltd. is a British Virgin Islands corporation whose managing director is
Dan Purjes.
None of the selling stockholders has any position, office or other
material relationship with INTERVU or any of its affiliates (or had any such
position, office or material relationship within the past three years), or will
own greater than one percent of our common stock after this offering, except
that (i) Wayne Burns and John O'Halloran are officers of INTERVU, (ii) Laura
Hunt and Jerry Landrum are employees of INTERVU, and (iii) General Electric
Company indicated in a Schedule 13G filed with the Commission on February 11,
1999 that NBC Multimedia, Inc., an affiliate of National Broadcasting Company,
Inc., owned 210,526 shares of our common stock, which amount represents
approximately 1.4% of our outstanding common stock on September 20, 1999.
10
<PAGE> 13
PLAN OF DISTRIBUTION
The selling stockholders may from time to time offer and sell their
shares of our common stock offered by this prospectus. We have registered their
shares for resale to provide them with freely tradable securities. However,
registration does not necessarily mean that they will offer and sell any of
their shares.
Offer and Sale of Shares. The selling stockholders, or their pledgees,
donees, transferees or other successors in interest, may offer and sell their
shares of our common stock in one or more of the following manners:
- on the Nasdaq Stock Market or other exchanges on which the
common stock is traded at the time of sale;
- in the over-the-counter market or otherwise at prices and at
terms then prevailing or at prices related to the then current
market price; or
- in privately negotiated transactions.
The selling stockholders, or their pledgees, donees, transferees or
other successors in interest, may sell their shares of our common stock in one
or more of the following transactions:
- a block trade in which the broker or 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;
- a broker or dealer may purchase as principal and resell the
shares for its own account under this prospectus; or
- ordinary brokerage transactions and transactions in which the
broker solicits purchasers.
The selling stockholders may accept and, together with any agent of the
selling stockholders, reject in whole or in part any proposed purchase of the
shares of our common stock offered by this prospectus.
Brokers and Dealers. The selling stockholders may select brokers or
dealers to sell their shares of our common stock. Brokers or dealers of the
selling stockholders may arrange for other brokers or dealers to participate in
selling the shares. The selling stockholders may give the brokers or dealers
commissions or discounts in amounts to be negotiated immediately before any
sale. In connection with these sales, these brokers or dealers, any other
participating brokers or dealers, and some pledgees, donees, transferees and
other successors in interest, may be deemed to be "underwriters" within the
meaning of Section 2(11) of the Securities Act of 1933. In addition, any
securities covered by this prospectus that qualify for sale pursuant to Rule 144
of the Securities Act of 1933 may be sold under Rule 144 rather than under this
prospectus.
Commissions. The selling stockholders will pay any sales commissions or
other sellers' compensation applicable to these transactions.
DESCRIPTION OF SERIES G PREFERRED STOCK
INTERVU'S certificate of incorporation authorizes the board of directors
to issue up to 5,000,000 shares of preferred stock in one or more series. The
board of directors previously designated 1,280,000 shares of preferred stock as
series G preferred stock, all of which were issued to National Broadcasting
Company, Inc. The holder or holders of series G preferred stock are entitled to
receive non-cumulative dividends, before any payment of any dividend, other than
in common stock, on INTERVU's common stock, at the rate of $.064 per share per
year, payable quarterly, when, as and if declared by the board of directors. In
the event of any liquidation, dissolution or winding up of INTERVU, the holders
of series G preferred stock will be entitled to receive, before any distribution
of any of the assets of INTERVU to the holders of common stock, an amount equal
to $8.00 per share plus all declared but unpaid dividends, if any. Each share of
series G preferred stock is convertible into 0.629% shares of common stock. This
conversion rate may be adjusted for stock splits, stock dividends or
combinations of outstanding shares of common stock. The holder of each share of
series G preferred stock has the right to one vote for each share of common
stock into which the series G preferred stock is convertible. With respect to
this vote, each holder of series G preferred stock will have full voting rights
and powers equal to those of the holders of common stock. INTERVU has granted
NBC rights to include shares of common stock issuable upon conversion of the
series G preferred stock in future registrations of common stock. NBC also has
the right to one demand that INTERVU register these shares of common stock after
INTERVU becomes eligible to use Form S-3 under the Securities Act of 1933.
EXPERTS
Ernst & Young LLP, independent auditors, have audited INTERVU's
financial statements and schedule included in INTERVU's Annual Report on Form
10-K for the year ended December 31, 1998, as set forth in their report, which
is incorporated by reference in this prospectus and elsewhere in the
registration statement. INTERVU's financial statements and schedule are
incorporated by reference in this prospectus and elsewhere in the registration
statement in reliance on Ernst & Young LLP's report, given on their authority as
experts in accounting and auditing.
LEGAL MATTERS
The legality of INTERVU's common stock offered by this prospectus will
be passed upon for INTERVU by Latham & Watkins, San Diego, California.
11
<PAGE> 14
WHERE TO FIND ADDITIONAL INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy materials we have filed
with the SEC 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 further
information on the operation of its public reference room. Our SEC filings also
are available to the public on the SEC's Internet site at www.sec.gov. In
addition, you may obtain a copy of our SEC filings at no cost by writing or
telephoning our Corporate Secretary at:
INTERVU Inc.
6815 Flanders Drive
San Diego, California 92121
(619) 623-8400
The SEC allows us to "incorporate by reference" in this prospectus
information we file with the SEC, which means that we may disclose important
information in this prospectus by referring you to the document that contains
the information. The information incorporated by reference is considered to be a
part of this prospectus, and later information filed with the SEC will update
and supersede this information. INTERVU incorporates by reference the documents
listed below and any future filings it makes with the SEC under Section 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934, until the offering of
securities covered by this prospectus is completed:
- The Annual Report on Form 10-K of INTERVU for the fiscal year
ended December 31, 1998,
- The Quarterly Report on Form 10-Q of INTERVU for the quarter
ended March 31, 1999, and
- The Quarterly Report on Form 10-Q of INTERVU for the quarter
ended June 30, 1999
We have filed with the SEC a registration statement on Form S-3 under
the Securities Act of 1933, relating to the securities that may be offered by
this prospectus. This prospectus is a part of that registration statement, but
does not contain all of the information in the registration statement. For more
detail concerning INTERVU and any securities offered by this prospectus, you may
examine the registration statement and the exhibits filed with it at the offices
of the SEC.
You should rely only on the information provided or incorporated by
reference in this prospectus or in the applicable supplement to this prospectus.
You should not assume that the information in this prospectus and the applicable
supplement is accurate as of any date other than the date on the front cover of
the document.
12
<PAGE> 15
===============================================================================
We have not authorized any person to make a statement that differs from
what is in this prospectus. If any person does make a statement that differs
from what is in this prospectus, you should not rely on it. This prospectus is
not an offer to sell, nor is it seeking an offer to buy, these securities in any
state where the offer or sale is not permitted. The information in this
prospectus is complete and accurate as of its date, but the information may
change after that date.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
INTERVU 2
Recent Developments 2
Risk Factors 3
Forward-Looking Statements 8
Use of Proceeds 8
Selling Stockholders 9
Plan of Distribution 11
Experts 11
Legal Matters 11
Where to Find Additional Information 12
</TABLE>
INTERVU INC.
1,935,192 SHARES
COMMON STOCK
P R O S P E C T U S
__________, 1999
===============================================================================
13
<PAGE> 16
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following is an itemized statement of expenses incurred in
connection with this Registration Statement. All such expenses will be paid by
INTERVU Inc. (the "Company").
<TABLE>
<S> <C>
SEC Registration Fee ..................................... $18,114
Nasdaq Listing Fee ....................................... 17,500
Legal Fees and Expenses .................................. 25,000
Accounting Fees and Expenses ............................. 10,000
Printing ................................................. 5,000
Miscellaneous ............................................ 5,000
TOTAL ....................................... $80,614
</TABLE>
All of the above items except the registration fee are estimates.
Item 15. Indemnification of Directors and Officers.
Under Section 145 of the Delaware General Corporation Law, the Company
has broad powers to indemnify its directors and officers against liabilities
they may incur in such capacities, including liabilities under the Securities
Act.
The Company's Amended and Restated Certificate of Incorporation and
Amended and Restated Bylaws provide that the Company will indemnify its
directors and officers to the fullest extent permitted by Delaware law. Delaware
law permits, but does not require, a corporation to indemnify officers,
directors, employees or agents and expressly provides that the indemnification
provided for under Delaware law shall not be deemed exclusive of any
indemnification right under any bylaw, vote of stockholders or disinterested
directors, or otherwise. Delaware law permits indemnification against expenses
and certain other liabilities arising out of legal actions brought or threatened
against such persons for their conduct on behalf of the Company, provided that
each such person acted in good faith and in a manner that he or she reasonably
believed was in or not opposed to the Company's best interests and in the case
of a criminal proceeding, had no reasonable cause to believe his or her conduct
was unlawful. Delaware law does not allow indemnification of directors in the
case of an action by or in the right of the Company (including stockholder
derivative suits) unless the directors successfully defend the action or
indemnification is ordered by the court.
The Company is a party to indemnification agreements with each of its
directors and officers. In addition, the Company maintains directors' and
officers' liability insurance covering its executive officers and directors.
Item 16. Exhibits.
5.1(1) Opinion of Latham & Watkins.
23.1(2) Consent of Ernst & Young LLP, Independent Auditors.
23.2(1) Consent of Latham & Watkins (included in Exhibit 5.1 hereto).
24.1(2) Power of Attorney (included on signature page hereto).
(1) Previously filed.
(2) Filed herewith.
Item 17. Undertakings.
The undersigned Registrant hereby undertakes:
14
<PAGE> 17
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) 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 SEC 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; and
(iii) 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 this registration statement;
provided, however, that subparagraphs (i) and (ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the SEC
by the Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered herein, 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.
The undersigned Registrant hereby further undertakes that, for the
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 Securities Exchange Act of 1934 that is incorporated by reference
in this registration statement shall be deemed to be a new registration
statement relating to the securities offered herein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to existing provisions or otherwise, the Registrant has
been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Securities Act of 1933 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 of 1933 and will be governed by the
final adjudication of such issue.
15
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
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
Amendment No. 2 to the Registration Statement to be signed on its behalf by the
undersigned, thereto duly authorized, in the City of San Diego, State of
California, on the 17th day of November, 1999.
INTERVU INC.
By: /s/ HARRY E. GRUBER
---------------------------------------
Harry E. Gruber
Chairman and Chief Executive Officer
POWER OF ATTORNEY
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.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ HARRY E. GRUBER Chairman of the Board and Chief November 17, 1999
- ------------------------------------ Executive Officer (Principal Executive
Harry E. Gruber Officer)
/s/ KENNETH L. RUGGIERO Vice President and Chief Financial November 17, 1999
- ------------------------------------ Officer (Principal Financial Officer and
Kenneth L. Ruggiero Principal Accounting Officer)
/s/ EDWARD DAVID* Director November 17, 1999
- ------------------------------------
Edward David
/s/ MARK DOWLEY* Director November 17, 1999
- ------------------------------------
Mark Dowley
/s/ ALAN Z. SENTER* Director November 17, 1999
- ------------------------------------
Alan Z. Senter
/s/ J. WILLIAM GRIMES* Vice Chairman November 17, 1999
- ------------------------------------
J. William Grimes
/s/ ISAAC WILLIS* Director November 17, 1999
- ------------------------------------
Isaac Willis
* By: /s/ HARRY E. GRUBER
------------------------------
Attorney-in-fact
</TABLE>
16
<PAGE> 19
EXHIBIT INDEX
The following exhibits are filed as part of this Registration Statement on
Form S-3 or are incorporated herein by reference.
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<S> <C>
5.1(1) Opinion of Latham & Watkins.
23.1(2) Consent of Ernst & Young LLP, Independent Auditors.
23.2(1) Consent of Latham & Watkins (included in Exhibit 5.1 hereto).
24.1(1) Power of Attorney (included on signature page hereto).
- ----------
</TABLE>
(1) Previously filed.
(2) Filed herewith.
17
<PAGE> 1
EXHIBIT 23.1
Consent of Ernst & Young LLP, Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement on Amendment No. 2 to Form S-3 (No. 333-88171) and
related Prospectus of InterVU Inc. for the registration of its common stock
expected to be filed on or about November 18, 1999 and to the incorporation by
reference therein of our report dated February 12, 1999 (except for the last
paragraph of Note 6, as to which the date is March 19, 1999), with respect to
the financial statements and schedule of InterVU Inc. included in its Annual
Report (Form 10-K) for the year ended December 31, 1998, filed with the
Securities and Exchange Commission.
/s/ Ernst & Young LLP
November 17, 1999
San Diego, California
