As filed with the Securities and Exchange Commission, April 21, 1999
Securities Act File No. 333-72383; Exchange Act File No. 0-29098
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
AMENDMENT NO. 1
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
NAVIDEC, INC.
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(Exact name of registrant as specified in its charter)
Colorado 33-0502730
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
14 Inverness Drive, Suite F-116
Englewood, CO 80112
(303) 790-7565
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(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
---------------------
Patrick R. Mawhinney, Chief Financial Officer
NAVIDEC, Inc.
14 Inverness Drive, Suite F-116
Englewood, CO 80112
(303) 790-7565
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(Name, address, including zip code, and telephone number,
including area code, of agent for service)
--------------------
Copies of Communications to:
Roger V. Davidson, Esq.
Ballard Spahr Andrews & Ingersoll, LLP
1225 17th Street, Suite 2300
Denver, Colorado 80202
(303) 292-2400
Approximate date of commencement of proposed sale to public:
As soon as practicable after the registration statement becomes effective
--------------------------
<PAGE>
If the only securities being registered on this Form are being offered
pursuant to dividend or interest investment 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.[ ]
<PAGE>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
===============================================================================================================================
Proposed Maximum Proposed Maximum
Title of Each Class of Securities to be Amount to be Offering Price Per Aggregate Offering Amount of
Registered Registered (2) Share(1) Price Registration Fee
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, no par value held by Selling
Security Holders 700,000 Shares $9.96875 $6,978,125 $1,940
Common Stock underlying Warrants held by
Selling Security Holders 70,000 Shares $9.96875 $697,812 $194
===============================================================================================================================
TOTALS 770,000 Shares $7,675,937 $2,134(3)
===============================================================================================================================
</TABLE>
(1) The proposed maximum offering price is estimated solely for the purpose of
determining the registration fee and calculated pursuant to Rule 457(c).
The average of the high and low prices of the Common Stock as reported by
the Nasdaq SmallCap Market on February 11, 1999 were used for the estimate.
(2) This registration statement covers an additional indeterminate number of
shares of common stock which may be issued in accordance with Rule 416.
(3) Previously paid
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 Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
PROSPECTUS
NAVIDEC, Inc.
770,000 Shares of Common Stock
The shares of our common stock covered by this prospectus are being sold by
the security holders listed under the heading "Selling Security Holders." These
selling security holders previously received the shares of common stock from us
or will receive these shares of common stock from us by exercising previously
issued common stock purchase warrants. We will not receive any of the proceeds
from the sales of the shares of common stock by the selling security holders.
The selling security holders may sell these shares from time to time in the over
the counter market in regular brokerage transactions, in transactions directly
with market makers or in certain privately negotiated transactions.
Our common stock is traded on the Nasdaq SmallCap Market under the trading
symbol "NVDC." The closing sales price of our common stock on April 5, 1999, as
reported by the Nasdaq SmallCap Market was $11.125.
There are certain risks involved with the ownership of our common stock,
including risks related to our business and the markets for our common stock.
(See "Risk Factors" beginning on page 6.)
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is accurate or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is .................. , 1999
<PAGE>
TABLE OF CONTENTS
Page
----
About this Prospectus 2
Information Made Available to You 2
Incorporation of Certain Documents by Reference 3
Prospectus Summary 4
Risk Factors 6
Use of Proceeds 12
Selling Security Holders 13
Plan of Distribution 14
Legal Matters 16
Experts 16
Securities And Exchange Commission Position
on Certain Indemnification 16
ABOUT THIS PROSPECTUS
You should only rely on the information contained in this prospectus. We
have not authorized anyone to provide you with information different from that
contained in this prospectus. The selling security holders are offering to sell,
and seeking offers to buy, shares of common stock only in jurisdictions where
offers and sales are permitted.
INFORMATION MADE AVAILABLE TO YOU
This prospectus is part of a Registration Statement on Form S-3 that we
filed with the Securities and Exchange Commission. Certain information in the
Registration Statement has been omitted from this prospectus in accordance with
the rules of the SEC.
We file annual reports, quarterly reports and current reports, proxy
statements and other information with the SEC. Our file number is 0-29098.
You may read and copy materials that we have filed with the SEC, including
the registration statement, at the following SEC public reference rooms:
450 Fifth Street, N.W. Northwest Atrium Center 7 World Trade Center
Room 1024 500 West Madison Street Suite 1300
Washington, D.C. 20549 Suite 1400 New York, New York 10048
Chicago, Illinois 60661
You can call the SEC at 1-800-732-0330 for further information about the
public reference room.
We are required to file electronic versions of these documents with the
SEC. Those documents may be accessed through the SEC's Internet site at
http://www.sec.gov. Our common stock is quoted on the Nasdaq SmallCap Market.
Reports, proxy and information statements and other information concerning us
may be inspected at the Nasdaq Stock Market at 1735 K Street, NW, Washington,
D.C. 20006.
Information about us is also available at our Internet site at
http://www.navidec.com.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents are deemed to be incorporated by reference in this
registration statement and to be a part of this prospectus.
1. Our annual report on Form 10-KSB for the year ended December 31, 1998.
2. Our current reports on Form 8-K reporting events dated each of January
7, 1999, March 1, 1999 and March 10, 1999.
3. The description of our no par value common stock which is contained in
our registration statement on Form 8-A filed with the SEC on January 28, 1997.
All documents subsequently filed by us with the SEC pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 prior to the
termination of the offering shall be deemed to be incorporated by reference into
this prospectus.
We will provide, without charge, to each person to whom a copy of this
prospectus is delivered, on the written or oral request of such person, a copy
of any or all of the documents incorporated into this prospectus by reference.
Written or telephone requests for such copies should be directed to our office:
NAVIDEC, Inc. 14 Inverness Drive, Suite F-116, Englewood, Colorado 80112, (303)
790-7565.
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PROSPECTUS SUMMARY
This is only a summary and does not contain all the information that may be
important to you. You should read the more detailed information contained in
this prospectus and incorporated into this prospectus by reference, including
but not limited to, the risk factors beginning on page 6.
About Us
We are based in Englewood, Colorado. We provide products and services that
enable Fortune 1000 customers to address their e-commerce initiatives. Our
highly experienced team rapidly develops component- based open systems
solutions. Out of this competency we have launched our first vertical market
that provides on-line solutions for the automotive industry. We also serve as a
distributor of various high technology and other products through traditional
and electronic channels. We provide our services and distribute our products to
over 1,300 customers as of the date of this prospectus.
Our core competencies in e-business technology and traditional product
marketing and distribution form our business model of providing complete
Internet/Intranet solutions. Those solutions include the following:
o systems and network infrastructure architecture,
o software development and services,
o content and aggregation of information located on the Internet or
intranet, and
o electronic commerce.
Our principal sources of revenue are from the following:
o architecture, design, development and implementation of open
system solutions for Fortune 1000 companies,
o license fees and recurring purchase request and advertising
revenue from our on-line automotive solution, and
o product sales of third party manufacturers.
Our principal business office is located at 14 Inverness Drive, Suite
F-116, Englewood, CO 80112. The telephone number at that address is (303)
790-7565.
Forward-Looking Statements
This prospectus and the documents incorporated into this prospectus by
reference contain forward-looking statements that concern our business. All
statements, other than statements of historical facts, included in this
prospectus that address activities, events or developments that we expect,
believe or anticipate will or may occur in the future, including the following
matters are forward looking statements:
o future capital costs of research and development,
o the size of various markets,
o market share,
o project margins,
o repayment of debt,
o business strategies, and
o expansion and growth of our operations.
These statements are based on certain assumptions and analyses made by us in
light of our experience and our perception of the following:
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o historical trends,
o current conditions,
o expected future developments, and
o other factors we believe are appropriate in the circumstances.
Such statements are subject to a number of assumptions including the following:
o risks and uncertainties, including the risk factors in this
prospectus,
o general economic and business conditions,
o the business opportunities that may be presented to and pursued
by us,
o changes in laws or regulations and other factors, many of which
are beyond our control, and
o availability to obtain project financing on favorable conditions.
You are cautioned that any such statements are not guarantees of future
performance and that actual results or developments may differ materially from
those projected in the forward-looking statements.
The Offering
Shares of common stock outstanding prior to this offering 7,475,111
Shares of common stock offered by this prospectus, including
common stock underlying warrants 770,000
Nasdaq SmallCap Market symbol for our common stock NVDC
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RISK FACTORS
Prior to making an investment decision, you should carefully consider,
together with the other information contained in and incorporated by reference
into this prospectus, the following risk factors.
We Are Subject to the Risks Associated with a New Business Enterprise
Although we have been in business since July 1993, our business has only
recently expanded into the following businesses relating to the Internet and
intranets:
o infrastructure equipment,
o software and services,
o content creation and aggregation of information located on the
Internet or intranet, and
o electronic commerce and distribution.
As a result of this expansion, we are subject to all the risks associated with a
new business enterprise. The likelihood of our success should be considered
relative to the problems frequently encountered in connection with the operation
and development of a new business and the competitive environment in which we
operate.
We Have Incurred Operating Losses and We May Incur Continued Losses for the
Foreseeable Future
We have only a very limited operating history in our Internet/Intranet
solutions business upon which to base any evaluation of our performance and
prospects in such business. Although there has been growth in annual revenue, we
incurred losses and experienced negative cash flow during the years ended
December 31, 1997 and 1998. We plan to focus in the near future on growing our
Internet/Intranet solutions business and increasing our distribution activities.
In order to do so, we must increase significantly our expenses for personnel,
marketing, equipment and other product purchases. In addition, we may experience
fluctuations in future operating results due to a variety of factors including
the following:
o general economic conditions,
o specific economic conditions in the Internet industry,
o capital and other costs relating to the expansion of operations,
and
o the mix of services and distribution channels offered by us.
Many of those factors are out of our control. There can be no assurance that our
operations will generate sufficient revenues to become profitable.
We May Be Required to Seek Additional Financing or Curtail Our Operations
Our capital requirements have been and will continue to be significant.
Prior to our initial public offering, we had been dependent primarily on bank
loans and loans from our affiliates and employees to fund our capital
requirements. We have more recently depended on proceeds from offerings of our
securities to fund our ongoing operations. We anticipate that the proceeds from
those offerings, together with the projected cash flow from our operations, will
be sufficient to fund our operations during 1999.
We however may be required to seek additional financing or curtail our
operations and/or expansion activities if any of the following occur:
o in the event that our business plans change,
o there are any delays in expanding our business,
o our projections prove to be inaccurate, or
o the proceeds from our recent offerings of securities prove to be
insufficient.
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Any additional equity financing may involve substantial dilution to our
then-existing shareholders. We have no current arrangements for, or readily
available sources of, additional financing. There also can be no assurance that
additional financing will be available to us when needed or, if available, that
it can be obtained on commercially reasonable terms. Even if we are able to
expand our business, there is no assurances that we will be successful or that
investors will derive a profit from an investment in us.
We Operate in A Developing Market and the Market for Our Products is Unproven
The Internet represent markets for our products and services which have
only recently begun to develop. These markets are rapidly evolving and are
characterized by low barriers to entry and an increasing number of market
entrants who have introduced or developed a wide variety of products and
services for communication, information and commerce. As is typical in the case
of a new and rapidly evolving industry, demand and market acceptance for new
products and services are subject to a high level of uncertainty. Moreover,
critical issues concerning the commercial use of the Internet remain unresolved
and may impact the growth of Internet and Web use. Those issues include the
following:
o security,
o reliability,
o compatibility,
o cost,
o difficulty in obtaining user demographic information,
o difficulty of use and access, and
o quality of service.
There can be no assurance that marketing or commerce over the Internet will
become widespread, or that products and services which we are developing for use
on the Internet will become accepted. In particular, enterprises that have
already invested substantial resources in other means of conducting commerce and
exchanging information may be reluctant to adopt a new strategy that could make
their existing products and infrastructure obsolete. Because the market for our
products and services is new and evolving, it is also difficult to predict with
any assurance the future growth rate, if any, and the size of the market for our
products. There can be no assurance of the following:
o that the market for our products and services will continue to
expand,
o that our products or services will be accepted,
o that individual personal computer users in business or at home
will use the Internet, or
o that people will use our products and services for commerce,
information and communication.
If a significant market develops more slowly than expected or becomes
saturated with competitors, or if our products do not achieve market acceptance,
our business, operating results and financial condition will be materially
adversely affected.
Risks Relating to Our Competition and the Dynamic Market in Which We Operate
General Characteristics of Our Competitors
Existing competitors to our Internet/Intranet solutions business include
Online Systems Services, Inc., Eagle River Interactive, Inc. and Open Market,
Inc. All of these companies are public companies traded on the NASDAQ system. We
also compete with a large number of regional firms providing similar services.
Potential competitors in this business include browser software vendors, PC and
UNIX software vendors and on-line service providers. Additional competition
comes from the following:
o numerous client/server companies,
o database companies,
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o multimedia companies,
o advertising agencies,
o document management companies,
o networking software companies,
o network management companies, and
o educational software companies.
In a broader sense, we may compete with the more traditional
advertising and distribution mediums, such as radio, television and mail order
outlets.
Potential competition also comes from our clients, who could choose to
address their Internet/Intranet needs through in-house personnel. Some of our
current and many of our potential competitors have the following
characteristics:
o longer operating histories,
o greater name recognition,
o larger installed customer bases, and
o significantly greater financial, technical and marketing
resources than ours.
A large number of companies act as re-marketers of computer networks,
graphics equipment and components, and our competition in the high computer
technology product distribution business is therefore also intense. In some
instances, we, in acting as a re-marketer, may compete with the original
manufacturer.
The market in which we operate is are characterized by low financial
barriers to entry and frequent introductions of new products. We therefore
expect competition in our business to increase in the future. There can be no
assurance that we will be able to successfully compete in our business. Although
we believe that we have the requisite management, technical and creative
abilities to successfully compete, the intense level of competition in our
business could materially adversely affect our future operating results and
financial condition.
Competition in Our Internet/Intranet Solutions Business
There is a risk that our competitors may out perform us in the competitive
factors affecting our Internet/Intranet solutions business. Those factors
include the following:
o core technology,
o breadth of services offered,
o creative and artistic ability,
o marketing and distribution resources,
o customer service and support, and
o price.
Competition in Our Product Distribution Business
There is a risk that our competitors may out perform us in the competitive
factors affecting our product distribution business. Those factors include the
following:
o technical expertise,
o breadth of products offered,
o product quality,
o performance and reliability,
o price,
o name recognition,
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o customer service and support, and
o access to distribution channels.
Competition in Our Automotive Solutions Business
There are numerous online automotive sales Web sites on the Internet with
which we compete. Other online auto sales products include Carpoint,
Auto-by-Tel, AutoConnect, and AutoVantage. A few Internet developers are also
attempting to sell online sales products to media, but none offer the total
sales solution that Wheels offers to ensure that dealers sell vehicles. Wheels
includes important add-ons such as touch-screen kiosks that maybe located in
various public places and mobile sales laptops that may be carried by auto
salespersons. Another important distinction is that we understand the auto sales
process and even train dealers to help them sell more autos from the leads
generated by Wheels.
Our Products are Affected by Rapid Obsolescence and Technological Change
The market for our Internet/Intranet solutions is characterized by rapidly
changing technology, frequent introductions of new products and evolving
industry standards. Those factors result in product obsolescence and short
product life cycles. Accordingly, our success is dependent upon our ability to
anticipate technological changes in the industry. We must continually identify,
obtain and successfully market new products and services that satisfy evolving
technologies, customer preferences and industry requirements. There can be no
assurance that competitors will not market products and services which have
perceived advantages over our products or which render products and services to
be offered by us obsolete or less marketable.
We Depend on Internet Infrastructure and Access
Our revenues will depend in large part upon a robust industry and
infrastructure for providing Internet access and carrying Internet traffic.
Notwithstanding current interest and worldwide subscriber growth, the Internet
may not prove to be a viable commercial marketplace because of inadequate
development of the necessary infrastructure or complementary products, such as
high speed modems. Because global commerce and on-line exchange of information
on the Internet and other open area networks are new and evolving, it is
difficult to predict with any assurance whether the Internet will prove to be a
viable commercial marketplace. There can be no assurance that the infrastructure
or complementary products necessary to make the Internet a viable commercial
marketplace will be developed or, if developed, that the Internet will in fact
become a viable commercial marketplace. If the necessary infrastructure or
complementary products are not developed, or if the Internet does not become a
viable commercial marketplace, our business, operating results and financial
condition will be materially adversely affected.
Effectively Managing Our Growth May Be Difficult
Our rapid growth and plans for further growth have placed, and are expected
to continue to place, a significant strain on our administrative, operational
and financial resources. Our ability to sustain growth effectively will depend
on our ability to manage growth and to train, motivate and manage our employees.
Currently, we rely on a limited staff which is responsible for all of our
activities, including the following:
o sales and promotion,
o client planning,
o product distribution, and
o technical development of products for clients.
Many of the staff members are currently performing a combination of these
functions. Our continued growth will require us to recruit and hire new
technical, sales and marketing personnel so that the staff can be better
specialized to market our services and serve client needs. Market competition
for the services of the limited number of people who are capable of performing
our technical services is intense. The inability to recruit, hire and retain
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necessary personnel or unexpected expansion difficulties could adversely affect
our business, operating results and financial condition.
We Depend on Relationships With Our Clients and Suppliers
We maintain many important relationships with our clients and suppliers.
These relationships often result in opportunities for expanding our client base,
technical capability and revenue base. The most significant of these
relationships are with Bank One, Bluestone, Sun Micro Systems, Netscape and
Sybase. While we have contracts with most of these companies, none of the
contracts are exclusive and for the most part these companies are free to
terminate their relationship with us at any time. The termination or
deterioration of one or more of these relationships could have a material
adverse effect on our business, operating results and financial condition.
We Depend on Recurring Revenues
A substantial part of our income is derived from the recurring revenues
associated with sales of supplies to existing clients and periodic maintenance
and upgrades to Internet and Intranet sites. Our clients are not required to
purchase supplies from us and may find another source for such supplies. Our
clients' need for such supplies may also diminish or disappear as a result of
technological advances or changes in customer use of hardware. In addition, most
of our Internet/Intranet solutions clients are not required to utilize us for
periodic maintenance and updates to their Internet and Intranet sites. Although
many of the sites designed for our clients contain proprietary tools licensed by
us to such clients only so long as we maintain such sites, such clients are
nonetheless free to take the information content of their sites to their own
servers or servers maintained by our competitors. The loss of clients who
provide recurring revenues could have a material adverse effect on us.
We May Not Be Able to Protect Our Proprietary Rights and We May Infringe the
Proprietary Rights of Others
We presently have no patents with respect to our proprietary technology.
Instead, we currently rely upon the following to protect our proprietary
technology:
o copyright and trademark laws,
o trade secrets,
o confidentiality procedures, and
o contractual provisions.
Those items afford only limited protection to protect our proprietary
technology. There can be no assurance that our measures to protect our current
proprietary technology will be adequate to prevent misappropriation of such
technology. There is also no assurance that our competitors will not
independently develop or patent technology that is substantially equivalent or
superior to our technology.
Although we believe that our products and technology do not infringe
upon the proprietary rights of any third parties, there can be no assurance that
third parties will not assert infringement claims against us. Similarly,
infringement claims could be asserted against products and technology that we
license, or have the rights to use, from third parties. Any such claims, if
proved, could materially and adversely affect our business and results of
operations. Although any such claims may ultimately prove to be without merit,
the time management spends addressing such claims and the legal costs associated
with such claims could materially and adversely effect our business and results
of operations.
Dependence on Key Personnel
Our success depends to a significant extent on the continued service of
certain key management personnel. In particular, we rely on Ralph Armijo, our
President and Chief Executive Officer. The loss or interruption of Mr. Armijo's
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services, for whatever reason, would have a material adverse effect on us. In
the event of the loss of services of Mr. Armijo, no assurance can be given that
we will be able to obtain the services of adequate replacement personnel. The
loss or interruption of the services of any of our other senior management
personnel would also have an adverse effect on us. We have entered into an
employment agreement dated May 1, 1998 with Mr. Armijo. We also currently
maintain a $2 million life insurance policy on his life. However, no assurance
can be given that we will be able to keep such policy in effect. We do not
maintain life insurance policies for any of our other executive officers.
Government Regulation and Legal Uncertainties
We currently are not subject to direct regulation by any government agency,
other than regulations applicable to businesses generally. However, due to the
increasing popularity and use of the Internet, it is possible that a number of
laws and regulations may be adopted with respect to the Internet, covering the
following issues:
o user privacy,
o unsolicited marketing,
o pricing and characteristics, and
o quality of products and services.
The adoption of any such laws or regulations may decrease the growth of the
Internet. Such laws could in turn cause the following:
o decrease the demand for our products,
o increase our cost of doing business, or
o or otherwise have an adverse effect on our business, operating
results or financial condition.
Moreover, the applicability to the Internet of existing laws governing
issues such as real and intellectual property ownership, libel and personal
privacy is uncertain. That uncertainty may affect our business, operating
results and financial condition.
Elimination of Our Directors' Liability
Our Articles of Incorporation contain a provision eliminating a
director's liability to us or our shareholders for monetary damages for a
breach
of fiduciary duty. However, a director's liability is not eliminated in
circumstances involving certain wrongful acts, such as the breach of a
director's duty of loyalty or acts or omissions which involve intentional
misconduct or a knowing violation of law. Our Articles of Incorporation also
obligate us to indemnify our directors and officers to the fullest extent
permitted under Colorado law. While we believe that these provisions are very
standard and necessary to assist us in attracting and retaining qualified
individuals to serve as directors, they could also serve to insulate our
directors against liability for actions which damage us or our shareholders.
We May Be Significantly Influenced by the Stock Ownership of Our Officers and
Directors
Based upon the7,475,111 shares of common stock being outstanding as of
April 5, 1999, our officers and directors, as a group, beneficially owned and
controlled 22.2% of outstanding common stock. In addition, cumulative voting is
not permitted with respect to our common stock. Cumulative voting provides that
a shareholder can cast votes in the election of directors equal to the number of
shares owned by such shareholder multiplied by the number of directors to be
elected to a single candidate or among the candidates as the shareholder wishes.
As a result, our officers and directors acting together, will be able to
exercise significant influence over all matters requiring stockholder approval
even though they do not own a majority of our common stock. Those matters
include the election of directors and the approval of significant corporate
transactions.
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No Dividends on Our Common Stock
We have not previously paid any cash or other dividends on our common stock
and do not anticipate payment of any dividends for the foreseeable future. We
anticipate that any earnings would be retained by us to finance our operations
and future growth and expansion.
The Price of Our Common Stock is Volatile
The trading prices of our common stock could be subject to wide
fluctuations in response to the following:
o quarterly variations in actual or anticipated results of our
operations,
o changes in analysts' earnings estimates,
o announcements of technological innovations or new products or
services by us or our competitors,
o general conditions in the Internet or other high computer
technology industries, or
o other factors.
In addition, the securities markets frequently experience extreme price and
volume fluctuation which affect market prices for securities of companies
generally, and technology companies in particular. Such fluctuations are often
unrelated to the operating performance of the affected companies. Broad market
fluctuations may adversely affect the market price of our common stock.
Possible Adverse Effects on Our Common Stock Due to Shares Eligible for Future
Sale
We currently have 7,475,111 shares of common stock outstanding. 4,355,399
shares of our common stock are freely tradable without restriction or further
registration. The remaining 3,119,712 shares of common stock are "restricted
securities" as that term is defined under Rule 144 of the Securities Act of 1933
and may only be sold by a registration statement under the Securities Act or
under another exemption under the Securities Act. No prediction can be made as
to the effect, if any, that sales of shares of common stock or even the
availability of such shares for sale will have on the market prices of the our
common stock prevailing from time to time. The possibility that substantial
amounts of our common stock may be sold in the public market may adversely
affect prevailing market prices for our common stock and could impair our
ability to raise capital through the sale of our equity securities.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the shares of common
stock by the selling security holders.
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SELLING SECURITY HOLDERS
The following table shows for the selling security holders, the following
information:
o the number shares of common stock beneficially owned by them as
of April 5, 1999,
o the number of shares of common stock covered by this prospectus,
and
o the number of shares of common stock to be retained after this
offering, if any.
<TABLE>
<CAPTION>
Number of Shares of Number of Number of Shares of
Common Stock Shares of Common Stock
Beneficially Owned Common Stock Beneficially Owned
Name Before the Offering (1) to be Sold after the Offering (2)
---- ----------------------- ---------- ----------------------
<S> <C> <C> <C>
Stephen M. Bathgate 2,250 2,250 -0-
David Mehigan Family Trust 25,000 25,000 -0-
Thomas Dietz 30,000 30,000 -0-
John Lewis Gardner 49,000 25,000 24,000
Gillian, Gaston & Waldon, EG 25,000 25,000 -0-
Dan Hall 5,000 5,000 -0-
James M. & Jennifer L. Hall 16,500 16,500 -0-
Robert D. Hall 16,500 16,500 -0-
Thomas M. Hall 2,500 2,500 -0-
Martin Hodas 15,000 15,000 -0-
James E. Hosch(3) 51,096 40,500 10,596
Eric J. Johnson 10,000 10,000 -0-
Arthur Kassoff 10,000 10,000 -0-
Charles Kirby 25,000 25,000 -0-
Eugene C. McColley 2,250 2,250 -0-
Barbara M. Mehigan IRA 25,000 25,000 -0-
Louis Moringstar 40,000 40,000 -0-
Yiska Moser Trust 91,150 91,150 -0-
Donald R. Plante 5,000 5,000 -0-
Martin Rothstien 5,000 5,000 -0-
13
<PAGE>
Number of Shares of Number of Number of Shares of
Common Stock Shares of Common Stock
Beneficially Owned Common Stock Beneficially Owned
Name Before the Offering (1) to be Sold after the Offering (2)
---- ----------------------- ---------- ----------------------
Frank H. Sell 10,000 10,000 -0-
Andrew Tobias 10,000 10,000 -0-
Edward Van Vliet 158,000 158,000 -0-
Edward Van Vliet IRA 25,350 25,350 -0-
Rick Wilber 198,000 150,000 48,000
</TABLE>
- --------------
(1) The number of shares of common stock indicated includes those shares
underlying warrants held by a selling security holder.
(2) The selling security holder will not own in excess of one (1%) percent of
our outstanding common stock subsequent to the offering when combined with
other offerings in which our common stock beneficially owned by the selling
security holder has been registered.
(3) James Hosch is one of our a directors.
PLAN OF DISTRIBUTION
We are registering the shares of our common stock covered by this
prospectus.
As used in this prospectus, the selling security holder includes donees,
pledgees, transferees or other successors in interest who will hold the selling
security holders' shares after the date of this prospectus. We are paying the
costs, expenses and fees of registering the common stock, but the selling
security holders will pay any underwriting or brokerage commissions and similar
selling expenses relating to the sale of the shares of common stock.
The selling security holders may sell our common stock at market prices
prevailing at the time of the sale, at prices related to the prevailing market
prices, at negotiated prices or at fixed prices, which may be changed. The
selling security holders may sell some or all of their common stock through:
o ordinary brokers' transactions which may include long or short sales;
o transactions involving cross or block trades or otherwise on the
Nasdaq SmallCap Market;
o purchases by brokers, dealers or underwriters as principal and resale
by those purchasers for their own accounts under this prospectus;
o market makers or into an existing market for the common stock;
o other ways not involving market makers or established trading markets,
including direct sales to purchasers or sales effected through agents;
14
<PAGE>
o transactions in options, swaps or other derivatives; or
o any combination of the selling options described in this prospectus,
or by any other legally available means.
The selling security holders may enter into hedging transactions with
broker-dealers who may engage in short sales of our common stock in the course
of hedging the positions they assume. The selling security holders also may
enter into option or other transactions with broker-dealers that require the
delivery by those broker-dealers of the common stock. Thereafter, the shares may
be resold under this prospectus.
In its selling activities, the selling security holders will be subject to
applicable provisions of the Securities Exchange Act of 1934 and the Securities
Exchange Act's rules and regulations, including Regulation M, which may limit
the selling security holders' timing of purchases and sales of our common stock.
The selling security holders and any broker-dealers involved in the sale or
resale of our common stock may qualify as "underwriters" within the meaning of
Section 2(11) of the Securities Act of 1933. In addition, the broker-dealers'
commissions, discounts or concessions may qualify as underwriters' compensation
under the Securities Act. If any selling security holders or any broker-dealer
qualifies as an "underwriter," then they will be subject to the prospectus
delivery requirements of Section 153 of the Securities Act, which may include
delivery through the facilities of the NASD.
In conjunction with sales to or through brokers, dealers or agents, the
selling security holders may agree to indemnify them against liabilities arising
under the Securities Act. We know of no existing arrangements between the
selling security holders, any other shareholder, broker, dealer, underwriter or
agent relating to the sale or distribution of our common stock.
In addition, to selling its common stock under this prospectus, the selling
security holders may:
o Transfer its common stock in other ways not involving market makers or
established trading markets, including by gift, distribution, or other
transfer; or
o Sell its common stock under Rule 144 of the Securities Act, if the
transaction meets the requirements of Rule 144.
We will amend or supplement this prospectus if required under the
Securities Act.
The selling security holders have been advised by us that during the time
each is engaged in distribution of the securities covered by this prospectus,
each must comply with Rule 10b-5 and Regulation M under the Exchange Act. They
must do all of the following under those rules:
o not engage in any stabilization activity in connection with our
securities;
o furnish each broker through which securities covered by this
prospectus may be offered the number of copies of this prospectus
which are required by each broker; and
o not bid for or purchase any securities of ours or attempt to induce
any person to purchase any of our securities other than as permitted
under the Securities Exchange Act.
Any selling security holders who may be "affiliated purchasers" of ours as
defined in Regulation M, have been further advised that they must coordinate
their sales under this prospectus with each other and us for purposes of
Regulation M.
15
<PAGE>
LEGAL MATTERS
Ballard Spahr Andrews & Ingersoll, LLP, will pass upon the validity of
common stock offered by this prospectus.
EXPERTS
Our financial statements for the year ended December 31, 1998 have been
audited by Arthur Andersen LLP, independent certified accountants, and our
financial statements for the year ended December 31, 1997 have been audited by
Hein + Associates LLP, independent certified public accountants, to the extent
and for the periods set forth in their reports. Those financial statements and
the reports related to them are incorporated by referenced into this prospectus
in reliance upon the authority of Arthur Andersen LLP and Hein + Associates LLP
as experts in auditing and accounting in giving their reports.
SECURITIES AND EXCHANGE COMMISSION POSITION ON CERTAIN
INDEMNIFICATION
The Colorado Business Corporation Act provides for indemnification by a
corporation of costs incurred by directors, employees, and agents in connection
with an action suit, or proceeding brought by reason of their position as a
director, employee, or agent. The person being indemnified must have acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation.
Our Articles of Incorporation obligate us to indemnify our directors and
officers to the fullest extent permitted under Colorado law.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling us 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.
16
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
--------------------------------------------
The estimated expenses of the offering, all of which are to be borne by the
Registrant, are as follows:
Total Registration Fee Under Securities Act of 1933............... $ 2,134
Printing and Engraving ...................................... 25,000 *
Accounting Fees and Expenses................................. 5,000 *
Legal Fees and Expenses ..................................... 15,000 *
Blue Sky Fees and Expenses (including related legal fees).... 1,000 *
Transfer Agent Fees ......................................... 2,000 *
Miscellaneous ............................................... 1,866
-------
Total........................................................ 52,000
=======
*Estimated
Item 15. Indemnification of Directors and Officers.
------------------------------------------
The Registrant's Articles of Incorporation eliminate the personal liability
of directors to the Registrant or its stockholders for monetary damages for
breach of fiduciary duty to the extent permitted by Colorado law. The
Registrant's Articles of Incorporation and By-Laws provide that the Registrant
shall indemnify its officers and directors to the extent permitted by Colorado
law, which authorizes a corporation to indemnify directors, officers, employees
or agents of the corporation in non-derivative suits if such party acted in good
faith and in a manner such party reasonably believed to be in or not opposed to
the best interest of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct was unlawful.
The Colorado Business Corporation Act further provides that indemnification
shall be provided if the party in question is successful on the merits or
otherwise.
Item 16. Exhibits
--------
The following Exhibits are filed as part of this Form S-3 Registration
Statement pursuant to Item 601 of Regulation S-B by incorporation by reference
to other filings:
Exhibit
Number Description
------ -----------
5.1 Opinion, with Consent, of Ballard Spahr Andrews & Ingersoll, LLP.
Filed herewith.
23.1 Consent of Arthur Andersen LLP. Filed herewith.
23.2 Consent of Hein + Associates LLP. Filed herewith.
23.3 Consent of Ballard Spahr Andrews & Ingersoll, LLP (included in Exhibit
5.1). Filed herewith.
Item 17. Undertakings
------------
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 the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such
II-1
<PAGE>
such indemnification is against public policy as expressed in the 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 Act and will be governed by the final adjudication of
such issue.
The undersigned Registrant hereby undertakes:
(1) 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.
(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 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) To file, during any period in which it offers or sells securities, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(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 thereto) that, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;
(iii)to include any additional or changed material information on the plan
of distribution.
II-2
<PAGE>
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 to be signed on its behalf by the undersigned, in the City of
Englewood, State of Colorado on the 16 day of April 1999.
NAVIDEC, INC.
By: /s/ Ralph Armijo
------------------------------------
Ralph Armijo, President,
Chief Executive Officer and Director
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates stated.
Signature Title Date
- --------- ----- ----
/s/ Ralph Armijo President, Chief April 16, 1999
- ------------------------- Executive Officer
Ralph Armijo and Director
/s/ Andrew Davis Director April 16, 1999
- -------------------------
Andrew Davis
/s/ Patrick R. Mawhinney Chief Financial Officer, April 16, 1999
- ------------------------- Treasurer and Director
Patrick R. Mawhinney
/s/ Lloyd G. Chavez, Jr. Director April 16, 1999
- -------------------------
Lloyd G. Chavez, Jr.
/s/ Gerald A. Marroney Director April 16, 1999
- -------------------------
Gerald A. Marroney
/s/ James Hosch Director April 16, 1999
- -------------------------
James Hosch
/s/ Michael Kranitz Director and Vice President April 16, 1999
- ------------------------ Strategic Development
Michael Kranitz
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
EXHIBITS
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933, AS AMENDED
NAVIDEC, INC.
---------------------------------------
(Name of Company as specified in charter)
<PAGE>
NAVIDEC, INC.
FORM S-3 REGISTRATION STATEMENT
The following Exhibits are filed as part of the Registrant's Form S-3
Registration Statement pursuant to Item 601 of Regulation S-B.
Exhibit Number Description
- -------------- -----------
5.1 Opinion, with Consent, of Ballard Spahr Andrews & Ingersoll,
LLP. Filed herewith.
23.1 Consent of Arthur Andersen LLP. Filed herewith.
23.2 Consent of Hein + Associates LLP. Filed herewith.
23.3 Consent of Ballard Spahr Andrews & Ingersoll, LLP (included in
Exhibit 5.1). Filed herewith.
Exhibit 5.1
Law Offices
Ballard Spahr Andrews & Ingersoll, LLP
1225 17th Street, Suite 2300 Philadelphia, Pa
Denver, Colorado 80202-5596 Baltimore, MD
(303) 292-2400 Camden, NJ
FAX: (303) 296-3956 Salt Lake City, UT
[email protected] Washington, DC
April 16, 1999
NAVIDEC, Inc.
14 Inverness Drive, Suite F-116
Englewood, Colorado 80112
Re: Form S-3 Registration Statement (File No. 333-72383) relating to shares
of no par value Common Stock for Selling Security Holders
Ladies and Gentlemen:
We have acted as counsel for NAVIDEC, Inc. (the "Company") in connection
with the preparation of the Form S-3 Registration Statement to be filed by the
Company with the Securities and Exchange Commission relating to the shares of
the Company's no par value common stock (the "Common Stock") being offered for
sale by certain holders of the Company's securities. As such counsel, we have
examined and relied upon such records, documents, certificates and other
instruments and have made such other investigation as we deemed appropriate as
in our judgment are necessary or appropriate to form the basis for the opinions
hereinafter set forth.
Based upon the foregoing, we are of the opinion that the shares of Common
Stock being offered for resale in accordance with the terms set forth in the
Registration Statement will be validly issued and outstanding, fully paid and
nonassessable.
We express no opinion concerning the laws of any jurisdiction other than
the federal law of the United States of America and the State of Colorado. We
consent to the filing of this opinion as an exhibit to the Registration
Statement and to the reference to this firm under the caption "Legal Matters" in
the Registration Statement and the Prospectus forming a part thereof.
Very truly yours,
/s/ Ballard Spahr Andrews & Ingersoll, LLP
Exhibit 23.1
ARTHUR ANDERSEN LLP
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated March 23, 1999
included in the Company's Form 10-KSB for the year ended December 31, 1998 and
to all references to our Firm included in this registration statement.
/s/ Arthur Andersen LLP
Denver, Colorado,
April 15, 1999.
Exhibit 23.2
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference of our report dated March 5, 1998
accompanying the financial statements of NAVIDEC, Inc. in the Form S-3
Registration Statement of NAVIDEC, Inc. and to the use of our name and the
statements with respect to us, as appearing under the heading "Experts" in the
Registration Statement.
/s/ HEIN + ASSOCIATES LLP
Denver, Colorado
April 19, 1999
