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As filed with the Securities and Exchange Commission on September 12, 2000
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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DIGITAL LAVA INC.
(Exact name of registrant as specified in its charter)
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DELAWARE 95-4584080
(State of incorporation) (I.R.S. Employer Identification No.)
13160 MINDANAO WAY, SUITE 350
MARINA DEL REY, CALIFORNIA 90292
(310) 577-0200
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
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DANNY GAMPE
CHIEF FINANCIAL OFFICER
DIGITAL LAVA, INC.
13160 MINDANAO WAY, SUITE 350
MARINA DEL REY, CALIFORNIA 90292
(310) 577-0200
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
COPIES TO:
GREGORY M. PETTIGREW
LATHAM & WATKINS
633 WEST FIFTH STREET, SUITE 4000
LOS ANGELES, CALIFORNIA 90071
(213) 485-1234
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this Registration Statement becomes effective.
If the only securities being registered on this Form are to be 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, as amended (the "Securities Act"), 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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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
===================================================================================================================================
PROPOSED PROPOSED AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES TO BE AMOUNT TO BE MAXIMUM OFFERING MAXIMUM AGGREGATE REGISTRATION
REGISTERED REGISTERED PRICE PER SHARE (1) OFFERING PRICE (1) FEE
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<S> <C> <C> <C> <C>
Common Stock, par value $0.0001 per share 2,625,000 $6.06 $15,914,063 $4,201.31
===================================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of computing the registration fee pursuant
to Rule 457(c) under the Securities Act of 1933. The price per share and
aggregate offering price are based upon the average of the high and low
prices of Digital Lava's common stock on September 11, 2000, as reported on
the American Stock Exchange. It is not known how many shares will be
purchased under this registration statement or at what price such shares
will be purchased.
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 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.
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<PAGE>
The information contained in this prospectus is not complete and may be changed.
The selling stockholders may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any jurisdiction where the offer or sale is not
permitted.
********************************************************************************
SUBJECT TO COMPLETION, DATED SEPTEMBER 12, 2000
PROSPECTUS
DIGITAL LAVA INC.
2,625,000 SHARES OF COMMON STOCK
We are registering 2,625,000 shares of our common stock for resale by the
selling stockholders identified in this prospectus. The selling stockholders may
offer their shares of common stock through one or more broker-dealers, in one or
more transactions on the American Stock Exchange in accordance with its rules,
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 shares by the selling
stockholders.
Our common stock is currently listed on the American Stock Exchange under
the symbol "DGV." The closing sale price of our common stock, as reported on the
American Stock Exchange on September 11, 2000, was $6.00 per share. We have
applied to have our common stock quoted on the Nasdaq Small Cap Market under the
symbol "DGLV".
INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 4.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS ________, 2000
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. You may read and copy
any document that we have filed at the SEC's public reference rooms in
Washington, D.C., New York, New York, and Chicago, Illinois. You may obtain
information on the operation of the SEC's public reference facilities by calling
the SEC at 1-800-SEC-0330. You can obtain copies of our SEC filings at
prescribed rates from the SEC Public Reference Section at 450 Fifth Street,
N.W., Washington, D.C. 20549. You can also access copies of such material
electronically on the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus. Any statement contained in a document
incorporated by reference in this prospectus is automatically updated and
superseded if information contained in this prospectus, or information that we
later file with the SEC modifies or replaces this information. We incorporate by
reference the documents listed below and any future filings we make with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act until the offering
described in this prospectus has been completed:
(1) Our Annual Report on Form 10-KSB for the fiscal year ended December
31, 1999 (File No. 1-14831), filed with the SEC on March 30, 2000;
(2) Our Quarterly Report on Form 10-QSB for the quarter ended March 31,
2000, filed with the SEC on May 15, 2000;
(3) Our Quarterly Report on Form 10-QSB for the quarter ended June 30,
2000, filed with the SEC on August 14, 2000;
(4) Our Proxy Statement for the 2000 Annual Meeting of Stockholders, filed
with the SEC on April 28, 2000;
(5) Our Supplement to Proxy Statement for the 2000 Annual Meeting of
Stockholders, filed with the SEC on June 15, 2000;
(6) Our Current Report on Form 8-K filed with the SEC on July 31, 2000;
and
(7) The description of our common stock contained in our registration
statement on Form 8-A filed with the SEC on February 11, 1999,
including any amendments or reports filed for the purpose of updating
such description.
You may request a free copy of any of the documents incorporated by
reference in this prospectus (other than exhibits, unless they are specifically
incorporated by reference in the documents) by writing to Investor Relations,
Digital Lava Inc., 13160 Mindanao Way, Suite 350, Marina del Rey, CA 90292, or
by calling our Investor Relations department at (310) 577-0200.
You should rely only on the information contained in this prospectus and
incorporated by reference into this prospectus. We have not authorized anyone to
provide you with information different from that contained in this prospectus.
The selling stockholders are offering to sell, and are seeking offers to buy,
these securities only in jurisdictions where offers and sales are permitted. The
information contained in this prospectus is accurate only as of the date of this
prospectus, regardless of the time of delivery of this prospectus or of any sale
of the shares.
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THE COMPANY
Digital Lava Inc. is a provider of software products and services related
to the use of rich mixed media for corporate training, communications, research
and other applications. Our product lines include publishing services,
vPublisher(TM), VideoVisor Professional(TM) (vvPro), VideoVisorWeb(TM) (vvWeb),
HotFoot for PowerPoint(TM) and Firestream Encoding Station(TM). We provide
service to clients by publishing their content, using the vPublisher(TM) tool,
into rich media presentations and then we provide the client the option to
deploy the rich media presentation on the Internet, corporate intranet, CD-ROM
or a hybrid of CD-ROM and the Internet. vPublisher(TM) is a proprietary
authoring software tool that allows the integration of text, data, voice, video
and web links into an interactive desktop application.
VideoVisorProfessional(TM) and VideoVisorWeb(TM) are proprietary viewers that
allow the user to access the content published in the Digital Lava format. vvPro
and vvWeb also allow the user to individually manage, manipulate and navigate
the formatted information on their computer screen. HotFoot allows users to add
streaming audio to Power Point presentations and deliver them electronically to
single or multiple recipients via email or hosting. Our Firestream Encoding
Station(TM) allows users to encode media from a single source into multiple
formats and bit rates simultaneously and in real time.
Our principal executive offices are located at 13160 Mindanao Way, Suite
350, Marina del Rey, CA 90292. Our telephone number is (310) 577-0200.
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RISK FACTORS
WE HAVE A HISTORY OF LOSSES AND MAY CONTINUE TO INCUR LOSSES.
We have not achieved profitability on a quarterly or annual basis to date
and may continue to incur net losses for the foreseeable future. Failure to
achieve profitability could deplete our current capital resources and reduce our
ability to raise additional capital. We incurred net losses of approximately
$4.2 million in 1997, $3.7 million in 1998, $10.2 million in 1999, and $3.3
million in the six months ended June 30, 2000. We had an accumulated deficit of
approximately $20.9 million as of December 31, 1999 and approximately $24.2
million as of June 30, 2000. The report of our independent accountants with
respect to the audited financial statements included in our Annual Report on
Form 10-KSB for the year ended December 31, 1999 states that our recurring
losses, negative cash flows from operations, significant accumulated deficit and
expectation of incurring future losses raise substantial doubt about our ability
to continue as a going concern. We expect to increase our operating expenses
significantly, expand our sales and marketing operations and continue to develop
and expand our product and service offerings. If increased revenues do not
accompany these increased expenses, our business, financial condition and
results of operations would be materially adversely affected.
OUR BUSINESS WILL SUFFER IF OUR TARGET CLIENTS DO NOT ADOPT OUR SOLUTIONS.
The market for rich media communications solutions is at an early stage of
development. Our ability to increase revenues and achieve profitability depends
on the adoption and acceptance of our rich media communications solutions. The
market for these services has only recently begun to develop and is evolving
rapidly. If our target clients do not adopt and accept our solutions, or if we
do not timely deploy solutions for our clients or fail to provide a high level
of client service, our business, financial condition and results of operations
would be materially adversely affected.
BECAUSE WE HAVE A LIMITED OPERATING HISTORY, IT MAY BE DIFFICULT TO EVALUATE OUR
BUSINESS AND PROSPECTS.
We were originally formed as a limited liability company in July 1995 and
were merged into a Delaware corporation in November 1996. We have a limited
operating history, which may make it difficult to evaluate our business. In part
because we are subject to the risks, expenses and uncertainties frequently
encountered by companies in new and rapidly evolving technology markets, we
cannot be certain that our business model and future operating performance will
yield the results that we seek. Moreover, because the markets for our products
and services are constantly changing, we may need to change our business model
to adapt. Therefore, we may face the risks, expenses and uncertainties commonly
encountered by early-stage companies. We may not be successful in achieving our
business objectives on a long-term basis. If we are unable to do so, our
business, financial condition and operating results will suffer.
WE MAY NOT BE ABLE TO OBTAIN ADEQUATE FINANCING TO IMPLEMENT OUR STRATEGY.
Successful implementation of our strategy will require our continued access
to capital. If we do not generate sufficient cash from operations, our growth
could be limited unless we are able to obtain capital through additional debt or
equity financings. Debt or equity financings may not be available as required.
If we raise additional funds by issuing equity securities, the percentage
ownership of our then current stockholders will be reduced. In addition, we may
issue equity securities that have rights, preferences or privileges senior to
those of the holders of our common stock as determined in the sole discretion of
our board of directors. Even if financing is available, it may not be on terms
that are favorable to us or sufficient for our needs. If we are unable to obtain
sufficient financing, we may be unable to fully implement our growth strategy.
IF WE FAIL TO RESPOND TO RAPID TECHNOLOGICAL CHANGE, OUR RICH MEDIA
COMMUNICATIONS SOLUTIONS COULD BE RENDERED OBSOLETE.
The rich media communications industry is characterized by rapid
technological change. Our future success depends upon our ability to rapidly
incorporate changing technology into our rich media communications solutions. If
we are unable to adapt or respond effectively to technological changes, our
business, financial condition and results of operations will be materially
adversely affected. In addition, our technology and rich media communications
solutions could be rendered obsolete. The development of our technologies and
rich media
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communications solutions requires substantial lead-time and expenditures. We may
not be able to keep pace with the latest technological developments,
successfully identify and meet the demands of our clients, use new technologies
effectively or adapt our rich media communications products to emerging industry
standards or to our clients' requirements, or successfully develop, introduce or
market new products.
WE DEPEND ON A LIMITED NUMBER OF LARGE CLIENTS FOR A MAJORITY OF OUR REVENUES.
ACCORDINGLY, THE LOSS OF OR A DELAY IN PAYMENT FROM ONE OR A SMALL NUMBER OF
CLIENTS COULD HAVE A LARGE IMPACT ON OUR REVENUES AND OPERATING RESULTS.
A limited number of large clients have accounted for a majority of our
revenues and may continue to do so for the foreseeable future. For example, one
client accounted for approximately 30% of revenues for the six months ended June
30, 2000, another client accounted for approximately 55.0% of revenue in 1999
and yet another client accounted for approximately 46.0% of revenue in 1998. If
our current clients do not need or want to continue to purchase our solutions
and we are not able to sell our solutions to new clients at comparable or
greater levels, our revenues may decline significantly. If we were to lose a key
client, our business, financial condition and operating results would suffer. In
addition, if a key client fails to pay amounts it owes us, or does not pay those
amounts on time, our operating results would suffer.
WE DEPEND ON TECHNOLOGY LICENSED FROM OTHER COMPANIES. WE MAY NOT BE ABLE TO
RENEW THESE LICENSES AS THEY EXPIRE FROM TIME TO TIME, AND MAY NOT BE ABLE TO
REPLACE THE LICENSED TECHNOLOGY WITHOUT SIGNIFICANT EXPENSE OR ENGINEERING
EFFORTS, IF AT ALL.
Many of our applications include technologies that we license from other
companies under royalty-free agreements. If we are unable to maintain or renew
these licenses on comparable terms when they expire, we would be forced to
remove these technologies from our products, develop or license comparable
technologies or pay new or additional royalties. This may require additional
extensive engineering efforts, significantly decrease our products'
functionality, or make such products less profitable for us, any of which could
harm our business, financial condition and operating results.
We may be required to obtain licenses from third parties to refine,
develop, market and deliver new products. We may be unable to obtain any needed
license on commercially reasonable terms or at all and rights granted under any
licenses may not be valid and enforceable.
THE LOSS OF KEY EXECUTIVES COULD ADVERSELY AFFECT OUR BUSINESS.
Our success depends to a significant degree upon the continued
contributions of our key management including Robert Greene, our Chief Executive
Officer and Chairman of the Board, and Joshua Sharfman, our President and Chief
Technology Officer. Although we have employment agreements with Mr. Greene and
Mr. Sharfman, if for any reason any key member of our management team, including
Mr. Greene and Mr. Sharfman, ceased to be active in our management, it could
have a material adverse effect on our business, financial condition and results
of operations.
WE FACE INTENSE COMPETITION FOR PERSONNEL, WHICH COULD IMPAIR OUR ABILITY TO
RECRUIT AND RETAIN KEY PERSONNEL.
Our ability to develop, market and sell our solutions and to maintain our
competitive position depends on our ability to attract, retain and motivate
highly skilled technical, sales and marketing and other personnel. There is a
limited number of people with the necessary technical skills and understanding,
and competition for their services, particularly in Southern California, is
intense. If we fail to recruit or retain these personnel, our ability to
develop, market and sell our solutions will suffer.
WE OPERATE IN MARKETS THAT WILL BECOME INCREASINGLY COMPETITIVE, WHICH COULD
LEAD TO DECREASING PRICES AND REDUCED PROFITABILITY.
The market for rich media communications solutions is highly competitive
and we expect that competition will intensify. Increased competition could lead
to decreasing prices and profitability. We compete with companies that offer
components of rich media communications solutions, including: (1) providers of
rich media software tools, (2) multimedia content production and delivery
companies, (3) companies that provide content hosting services, which include
storing, delivering and tracking the distribution of content and (4) traditional
communications and
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learning solution companies that offer live meeting and seminar services. In
addition, our clients and potential clients represent a source of competition to
the extent they determine to develop these communications solutions themselves.
Many of our current and potential competitors have longer operating
histories, significantly greater financial, technical and marketing resources,
greater name recognition and larger existing client bases than we do. These
competitors may also be able to undertake more extensive marketing campaigns for
their brands and services, adopt more aggressive pricing policies and make more
attractive offers to potential employees and partners. We may be unable to
compete successfully against current or future competitors and competitive
pressures may cause our business to suffer.
WE MAY NOT BE ABLE TO ADEQUATELY MANAGE OUR ANTICIPATED GROWTH, WHICH COULD
IMPAIR OUR EFFICIENCY AND NEGATIVELY IMPACT OUR OPERATIONS.
We may not be able to manage our growth effectively, which could impair our
efficiency, reduce the quality of our solutions, impair further growth and harm
our business, financial condition and operating results. If we do not
effectively manage this growth, we will not be able to operate efficiently or
maintain the quality of our products. Either outcome would harm our operating
results. In the past, we have experienced rapid growth, and we plan to continue
to expand our operations. This expansion is expensive and places a significant
strain on our personnel and other resources. To manage our expanded operations
effectively, we will need to further improve our operational, financial and
management systems and successfully hire, train, motivate and manage our
employees.
OUR FAILURE TO PROTECT OUR INTELLECTUAL PROPERTY MAY IMPAIR OUR COMPETITIVE
POSITION.
Our copyrights, service marks, trademarks, trade secrets, proprietary
technology and similar intellectual property are critical to our success. If we
are unable to adequately protect our rights from infringement by competitors or
others, or from misuse by our licensees, the competitive advantage that our
rights provide will be weakened.
We rely on trademark and copyright law, trade secret protection and
confidentiality and license agreements with our employees and independent
contractors to protect our proprietary rights. We strategically pursue the
registration of trademarks and service marks in the United States and abroad.
Effective trademark, service mark, copyright and trade secret protection may not
be available in every country in which our products and services are made
available.
We license our proprietary software to third parties pursuant to license
agreements that impose restrictions on their ability to utilize the software.
The steps taken by us to protect our proprietary rights under these licenses may
not be adequate. Despite our efforts to protect our proprietary rights,
unauthorized parties may attempt to copy aspects of our products or to obtain
and use information that we regards as proprietary. Our means of protecting our
proprietary rights may not be adequate and our competitors may independently
develop similar technology or attempt to duplicate our products.
WE MAY BECOME SUBJECT TO INTELLECTUAL PROPERTY LITIGATION IN THE FUTURE THAT
COULD CAUSE US TO INCUR SIGNIFICANT EXPENSE AND COULD REQUIRE US TO ALTER OUR
PRODUCTS.
We may be subject to legal proceedings and claims associated with our
intellectual property from time to time in the future. These claims, even if
without merit, could cause us to expend significant financial and managerial
resources. Further, if these claims are successful, we may be required to change
our trademarks, alter our copyrighted material or pay financial damages, any of
which could harm our business. Third parties may infringe or misappropriate our
copyrights, trademarks or similar proprietary rights in the future. In such
event, we may be forced to pursue infringement claims against such third
parties. These claims also could cause us to expend significant financial and
managerial resources.
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OUR OPERATING RESULTS MAY FLUCTUATE SIGNIFICANTLY FROM QUARTER TO QUARTER, WHICH
MAY NEGATIVELY IMPACT OUR STOCK PRICE.
Our quarterly operating results may fluctuate significantly in the future
as a result of a variety of factors, some of which are outside of our control.
These factors include:
o the timing and amount of new contracts and the renewal of existing
contracts;
o the relative mix of software license revenues and Publishing Services
revenues;
o our pricing strategies;
o legal or regulatory changes in revenue recognition requirements; and
o market trends and economic conditions affecting consumers' receptivity
of rich media communications products.
Because of these and other factors, we believe that comparisons of our
quarterly operating results are not necessarily meaningful. In addition, it is
possible that in some future quarters our operating results will be below the
expectations of research analysts and investors, in which case the price of our
common stock is likely to decline.
POTENTIAL ERRORS IN OUR SOFTWARE COULD HARM OUR REPUTATION AND REDUCE OUR SALES
AND PROFITABILITY.
Our software may contain "bugs" or errors. Software defects discovered
after we release our software could result in loss of revenues, delays in market
acceptance and harm to our reputation. Any product liability claim against us,
if successful and of sufficient magnitude, could harm our profitability and
future sales. Although we typically design our client license agreements to
contain provisions that limit our exposure to potential product liability
claims, we cannot guarantee that contractual limitations of liability would be
enforceable or would otherwise protect us from liability for damages to a client
resulting from a defect in our software.
WE EXPECT TO GENERATE REVENUES FROM OUR CONTENT HOSTING BUSINESS, WHICH WILL
SUFFER IF THE HOSTING EQUIPMENT AND SOFTWARE EXPERIENCE SYSTEM FAILURES.
We expect to generate revenue from hosting our clients' Hotfoot content on
our servers or those of outsourced hosting providers. The ability to host
content will depend on the efficient and uninterrupted operation of the hosting
computer and communications hardware and software systems. We currently rely
upon an outsourced hosting company to provide such services and do not have
fully redundant content hosting systems, a formal disaster recovery plan or
arrangements with alternative providers of hosting services. All of these
content hosting servers are located at facilities in Southern California. These
systems and operations are vulnerable to damage or interruption from
earthquakes, floods, fires, power loss, telecommunication failures or similar
events. They are also subject to computer viruses, break-ins, sabotage,
intentional acts of vandalism and similar misconduct. Despite any precautions we
and our outsourced hosting provider may take, the occurrence of a natural
disaster or other unanticipated problems at our facilities could result in
interruptions in our content hosting service. Any damage to or failure of these
content hosting systems could result in interruptions in our content hosting
service. System interruptions will reduce our revenues and profits, and our
future revenues and profits will be harmed if our clients believe that our
content hosting system is unreliable.
OUR STOCK PRICE IS LIKELY TO BE EXTREMELY VOLATILE, WHICH COULD CAUSE AN
INVESTOR TO LOSE ALL OR A PART OF ITS INVESTMENT.
The market price of our common stock is likely to be extremely volatile.
The stocks of technology companies like Digital Lava have experienced extreme
price and volume fluctuations in recent months, many of which fluctuations
appear unrelated to the companies' business, financial condition or operating
results. Although the market price of our stock will in part be based on our
business, financial condition and operating results, we expect that it will also
be affected to a significant degree by these industry-wide price and volume
fluctuations.
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THERE MAY BE AN ADVERSE EFFECT ON THE MARKET PRICE OF OUR STOCK AS A RESULT OF
SHARES BEING AVAILABLE FOR SALE IN THE FUTURE.
Sales of a substantial amount of our common stock in the public market
after this offering, or the perception that these sales may occur, could
adversely affect the prevailing market price of our common stock. This could
also impair our ability to raise additional capital through the sale of our
equity securities. Moreover, the exercise of a substantial amount of our
outstanding warrants after this offering could adversely affect the prevailing
market price of our common stock.
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
This prospectus and the documents incorporated by reference in this
prospectus contain forward-looking statements. These forward-looking statements
are based on our current expectations, estimates and projections about our
industry, management's beliefs and certain assumptions made by us. Words such as
"expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates"
and variations of these words or similar expressions are intended to identify
forward-looking statements. Additionally, statements concerning future matters
such as the development of new services, technology enhancements, possible
changes in legislation and other statements regarding matters that are not
historical are forward-looking statements. These statements are not guarantees
of future performance and are subject to risks, uncertainties and assumptions
that are difficult to predict. Therefore, our actual results could differ
materially from those expressed or forecasted in any forward-looking statements
as a result of a variety of factors, including those set forth in "Risk Factors"
above and elsewhere in, or incorporated by reference into, this prospectus. We
undertake no obligation to update publicly any forward-looking statements for
any reason, even if new information becomes available or other events occur in
the future.
USE OF PROCEEDS
The shares of common stock offered by this prospectus are being sold by the
selling stockholders for their own account, and we will not receive any of the
proceeds from the sale of the shares.
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SELLING STOCKHOLDERS
The 2,625,000 shares of our common stock which may be offered under this
prospectus are beneficially owned by the selling stockholders listed in the
table below.
All of the selling stockholders other than Sutro & Co. Incorporated
acquired their shares of common stock pursuant to a Subscription Agreement dated
as of July 26, 2000. Sutro & Co. Incorporated acted as placement agent in
connection with such offering, pursuant to which we paid it customary placement
agent fees. The shares shown as beneficially owned by Sutro & Co. Incorporated
are issuable upon exercise of a warrant issued on July 31, 2000.
Because the selling stockholders may sell all or some portion of the shares
covered by this prospectus and there are currently no agreements, arrangements
or understandings with respect to the sale of any shares, we cannot estimate the
number of shares, and the percentage of outstanding shares of common stock, that
will be held by any of them after completion of this offering.
This prospectus also covers any additional shares of common stock which
become issuable in connection with shares sold by the prospectus by reason of a
stock dividend, stock split, recapitalization or other similar transaction
effected without the receipt of consideration which results in an increase in
the number of our outstanding shares of common stock.
The following table identifies each selling stockholder and sets forth
information to our knowledge as of the date of this prospectus with respect to
the number of shares of common stock held by each selling stockholder prior to
the offering and the number of shares of common stock which may be offered under
this prospectus from time to time by each selling stockholder. Percentage
ownership is based on 7,192,777 shares of common stock outstanding on September
7, 2000.
Except as described above, we are unaware of any material relationship
between any of the selling stockholders and us in the past three years other
than as a result of the ownership of the shares of common stock.
<TABLE>
<CAPTION>
NUMBER OF PERCENT NUMBER OF
SHARES OF SHARES
BENEFICIALLY OUTSTANDING HEREBY
SELLING STOCKHOLDER OWNED SHARES REGISTERED
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Special Situations Private Equity Fund L.P.
153 East 53rd Street, 55th Floor
New York, NY 10022...................................... 400,000 5.6% 400,000
New Frontier Capital L.P.
919 Third Avenue, 6th Floor
New York, NY 10022...................................... 686,000 9.5% 306,250
Special Situations Technology Fund L.P.
153 East 53rd Street, 55th Floor
New York, NY 10022...................................... 250,000 3.5% 250,000
Upland Associates L.P.
530 Fifth Avenue, 26th Floor
New York, NY. 10036..................................... 250,000 3.5% 250,000
Watson Investment Partners I
237 Park Avenue, Suite 801
New York, NY 10017...................................... 169,500 2.4% 169,500
Carol C. Timmis
278 Hawley Road
North Salem, NY 10560................................... 160,000 2.2% 160,000
</TABLE>
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<TABLE>
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<S> <C> <C> <C>
JMG Capital Partners L.P.
1999 Avenue of the Stars, Suite 2530
Los Angeles, CA 90067................................... 125,000 1.7% 125,000
JMG Triton Offshore Fund Limited
1999 Avenue of the Stars, Suite 2530
Los Angeles, CA 90067................................... 125,000 1.7% 125,000
Sutro & Co. Incorporated
11150 Santa Monica Blvd., Suite 1500
Los Angeles, CA 90025................................... 125,000 1.7% 125,000
Donald P. Moriarty
20 Prospect Hill Avenue
Summit, NJ 07901........................................ 100,000 1.4% 100,000
John H. Timmis
278 Hawley Road
North Salem, NY 10560................................... 100,000 1.4% 100,000
Valor Capital Management L.P.
200 Park Avenue, Suite 3900
New York, NY 10166...................................... 100,000 1.4% 100,000
Edward Giles, IRA #2
c/o Fiduciary Trust International
2 World Trade Center
New York, NY 10048...................................... 70,000 * 65,000
Goodnow, Grey & Co.
36 Old Kings Highway South, Suite 300
Darien, CT 06820........................................ 60,000 * 60,000
Westward Inc.
919 Third Avenue, 6th Floor
New York, NY 10022...................................... 686,000 9.5% 43,750
Vertical Partners L.P.
36 Old Kings Highway South, Suite 300
Darien, CT 06820........................................ 40,000 * 40,000
Watson Investment Partners II
237 Park Avenue, Suite 801
New York, NY 10017...................................... 38,000 * 38,000
Benjamin P. & Catherine S. Griess
28 Johnson Place
Rye, NY 10580........................................... 25,000 * 25,000
Edward M. & Patricia V. Giles Insurance Trust
c/o Fiduciary Trust International
2 World Trade Center
New York, NY 10048...................................... 25,000 * 25,000
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Joseph D. Lansing
160 Biscay Drive
Bal Harbour, FL 33154................................... 25,000 * 25,000
Chester White
329A 17th Street
Manhattan Beach, CA 90266............................... 12,500 * 12,500
John Belko
P.O. Box 156
43 Old Harbor Road
Adamsville, RI 02801.................................... 10,000 * 10,000
John Everets
c/o Boston Private Bank
Attn: Don Brown
10 Post Office Square
Boston, MA 02109........................................ 10,000 * 10,000
Bruce A. Haverberg
10 Tremont, Suite 200
Boston MA 02108......................................... 10,000 * 10,000
Mary T. Haverberg
10 Tremont, Suite 100
Boston MA 02108......................................... 10,000 * 10,000
John D. Hogan, IRA #1
c/o Fiduciary Trust International
2 World Trade Center
New York, NY 10048...................................... 11,000 * 10,000
Arthur A. & Alice E. Sasahara Insurance Trust
The Courtyard, #12
1115 Beacon Street
Newton, MA 02461........................................ 10,000 * 10,000
Claire R. Saxe
84 Westerly Road
Weston, MA 02493........................................ 10,000 * 10,000
Stuart H. Whitlock
c/o CIBC World Markets Corp., Custodian
1 Federal St, 22nd Fl.
Boston, MA 02110........................................ 10,000 * 10,000
</TABLE>
* Less than 1%.
11
<PAGE>
PLAN OF DISTRIBUTION
We are registering the common stock on behalf of the selling stockholders.
The shares offered by this prospectus may be sold from time to time by the
selling stockholders or their respective pledgees, donees, transferees or
successors in interest, in one or more of the following transactions (which may
involve one or more block transactions):
o on the American Stock Exchange;
o in the over-the-counter market;
o in privately negotiated transactions;
o through the writing of options on shares or short sales; or
o in a combination of such transactions.
Each sale may be made either at market prices prevailing at the time of
such sale or at negotiated prices or at such other price as the selling
stockholders determine from time to time. Some or all of the shares offered by
this prospectus may be sold directly to market makers acting as principals or
through brokers acting on behalf of the selling stockholders or as agents for
themselves or their customers or to dealers for resale by such dealers. In
connection with such sale, such brokers and dealers may receive compensation in
the form of discounts, commissions or concessions from the selling stockholders
and may receive commissions from the purchasers of shares offered by this
prospectus for whom they act as broker or agent (which discounts and commissions
are not anticipated to exceed those customary in the types of transactions
involved).
The selling stockholders have sole discretion not to accept any purchase
offer or make any sale of shares offered by this prospectus if they deem the
purchase price to be unsatisfactory. Any broker or dealer participating in any
such sale may be deemed to be an "underwriter" within the meaning of the
Securities Act and will be required to deliver a copy of this prospectus to any
person who purchases any of the shares offered by this prospectus from or
through such broker or dealer. The compensation of such broker-dealers may be
deemed underwriting discounts and commissions. In addition, any shares covered
by this prospectus that qualify for sale pursuant to Rule 144 may be sold under
Rule 144 rather than pursuant to this prospectus.
The selling stockholders may enter into hedging transactions with
broker-dealers or other financial institutions in connection with distribution
of the shares or otherwise. In such transactions, broker-dealers or other
financial institutions may engage in short sales of the shares in the course of
hedging the positions they assume with selling stockholders. The selling
stockholders may also sell shares short and redeliver the shares to close out
such short positions. The selling stockholders may enter into option or other
transactions with broker-dealers or other financial institutions which require
the delivery to the broker-dealer or other financial institutions of the shares.
The broker-dealer or other financial institutions may then resell or
otherwise transfer such shares pursuant to this prospectus. The selling
stockholders also may loan or pledge the shares to a broker-dealer. The
broker-dealer may sell the shares so loaned, or upon a default the broker-dealer
may sell the pledged shares pursuant to this prospectus.
To comply with the securities laws of certain jurisdictions, if applicable,
the shares offered by this prospectus will be sold in such jurisdictions only
through registered or licensed brokers or dealers. In certain states, the shares
offered by this prospectus may not be sold unless (1) the shares offered by this
prospectus have been registered or qualified for sale in such state or an
exemption from registration exists or (2) qualification is available and is
complied with. Also, each selling stockholder will be subject to the applicable
provisions of the Securities Act and Exchange Act and the rules and regulations
of both acts, including Regulation M. The provisions of Regulation M may limit
the timing of purchases and sales of shares of the common stock by the selling
stockholders.
We will make copies of this prospectus available to the selling
stockholders and we have informed them of the need for delivery of copies of
this prospectus to purchasers at or prior to the time of any sale of the shares
offered hereby. The selling stockholders may indemnify any broker-dealer that
participates in transactions involving the sale of the shares against certain
liabilities, including liabilities arising under the Securities Act of 1933.
12
<PAGE>
At the time a particular offer of shares is made, if required, a prospectus
supplement will be distributed that will set forth the number of shares being
offered and the terms of the offering, including the name of any underwriter,
dealer or agent, the purchase price paid by any underwriter, any discount,
commission and other item constituting compensation, any discount, commission or
concession allowed or reallowed or paid to any dealer, and the proposed selling
price to the public.
Pursuant to the terms of the registration rights agreements between us and
the selling stockholders, we will pay all expenses of the registration of the
common stock, except that the selling stockholders will pay any applicable
underwriting discounts and commissions. The selling stockholders will be
indemnified by us against certain civil liabilities, including certain civil
liabilities under the Securities Act. We will be indemnified by the selling
stockholders against certain civil liabilities, including certain liabilities
under the Securities Act.
LEGAL MATTERS
The validity of the shares offered by this prospectus will be passed upon
for us by Latham & Watkins, Los Angeles, California.
EXPERTS
The financial statements incorporated in this prospectus by reference to
the Annual Report on Form 10-KSB for the year ended December 31, 1999 have been
so incorporated in reliance on the report (which contains an explanatory
paragraph relating to Digital Lava's ability to continue as a going concern as
described in Note 2 to the financial statements) of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
13
<PAGE>
<TABLE>
<CAPTION>
<S><C>
======================================================= ====================================================
NEITHER DIGITAL LAVA NOR THE SELLING
STOCKHOLDERS HAVE AUTHORIZED ANY PERSON TO GIVE ANY DIGITAL LAVA INC.
INFORMATION OR TO MAKE ANY REPRESENTATION NOT
CONTAINED OR INCORPORATED BY REFERENCE IN THIS
PROSPECTUS. YOU MUST NOT RELY ON ANY INFORMATION OR 2,625,000 SHARES
REPRESENTATION NOT CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS. THIS PROSPECTUS IS NOT
AN OFFER TO SELL, NOR IS IT SEEKING AN OFFER TO BUY,
ANY SECURITY OTHER THAN THE SHARES OFFERED BY THIS OF
PROSPECTUS. THIS PROSPECTUS IS NOT AN OFFER TO SELL,
NOR IS IT SEEKING AN OFFER TO BUY, THESE SHARES IN
ANY JURISDICTION IN WHICH THE OFFER OR SALE IS
PROHIBITED. THE INFORMATION IN THIS PROSPECTUS IS COMMON STOCK
COMPLETE AND ACCURATE AS OF ITS DATE, BUT THE
INFORMATION MAY CHANGE AFTER THAT DATE.
--------------
TABLE OF CONTENTS
PAGE
----
Where You Can Find More Information............. 2
The Company..................................... 3
Risk Factors.................................... 4
Special Note Regarding Forward Looking
Statements................................... 8
Use of Proceeds................................. 8
Selling Stockholders............................ 9
Plan of Distribution............................ 12
Legal Matters................................... 13
Experts......................................... 13
----------------------------------------------------
PROSPECTUS
----------------------------------------------------
, 2000
======================================================= ====================================================
</TABLE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Digital Lava will pay all expenses incident to the offering and sale to the
public of the shares being registered other than any commissions and discounts
of underwriters, dealers or agents and any transfer taxes. Such expenses are set
forth in the following table. All of the amounts shown are estimates except the
SEC registration fee.
SEC registration fee.............................................. $ 4,201
Legal and accounting fees and expenses............................ 50,000
Printing fees and expenses........................................ 5,000
Miscellaneous expenses............................................ 5,799
-----------
Total.......................................................... $ 65,000
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware
provides that a corporation has the power to indemnify a director, officer,
employee or agent of the corporation and certain other persons serving at the
request of the corporation in related capacities against amounts paid and
expenses incurred in connection with an action or proceeding to which he or she
is made, or is threatened to be made, a party by reason of such position, if
such person has acted in good faith and in a manner he or she reasonably
believed to be in or not opposed to the best interests of the corporation, and,
in any criminal proceeding, if such person had no reasonable cause to believe
his or her conduct was unlawful; provided that, in the case of actions brought
by or in the right of the corporation, no indemnification may be made with
respect to any matter as to which such person has been adjudged to be liable to
the corporation unless and only to the extent that the adjudicating court
determines that such indemnification is proper under the circumstances.
Digital Lava's Second Restated Certificate of Incorporation provides that
no director will be personally liable to Digital Lava or its stockholders for
monetary damages for breach of fiduciary duty as a director, except for
liability (i) for any breach of the director's duty of loyalty to Digital Lava
or its stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii) for
authorizing the payment of a dividend or repurchase of stock or (iv) for any
transaction in which the director derived an improper personal benefit.
Digital Lava's Second Restated Certificate of Incorporation further
provides that Digital Lava shall indemnify, in accordance with and to the full
extent now or hereafter permitted by law, any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(including, without limitation, an action by or in the right of Digital Lava),
by reason of his acting as director of Digital Lava (and Digital Lava, in the
discretion of the Board, may so indemnify a person by reason of the fact that he
is or was an officer or employee of Digital Lava or is or was serving at the
request of Digital Lava in any other capacity for or on behalf of Digital Lava)
against any liability or expense actually and reasonably incurred by such person
in respect thereof; provided, however, that, Digital Lava shall not be obligated
to indemnify any such person (i) with respect to proceedings, claims or actions
initiated or brought voluntarily by such person and not by way of defense, or
(ii) for any amounts paid in settlement of an action effected without the prior
written consent of Digital Lava to such settlement. Such indemnification is not
exclusive of any other right to indemnification provided by law, agreement or
otherwise.
Digital Lava's Amended and Restated Bylaws provide that Digital Lava shall,
to the fullest extent permitted by law, indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending, or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of Digital Lava) by
reason of the fact that he or she is or was a director or officer of Digital
Lava, or that such director or officer is or was serving at the request of
Digital Lava as a director, officer, employee or agent of another corporation,
partnership, joint venture trust or other enterprise (collectively "Agent"),
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him or her in connection with
such action, suit or proceeding if he or she acted in good faith and in a
II-1
<PAGE>
manner he or she reasonably believed to be in or not opposed to the best
interests of Digital Lava, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct was unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
will not, of itself, create a presumption that the person did not act in good
faith and in a manner which he or she reasonably believed to be in or not
opposed to the best interests of Digital Lava, and with respect to any criminal
action or proceeding, had reasonable cause to believe that his or her conduct
was unlawful.
Digital Lava's Amended and Restated Bylaws provide further that Digital
Lava shall, to the fullest extent permitted by law, indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of Digital Lava to procure a
judgment in its favor by reason of the fact that he or she is or was an Agent
against expenses (including attorneys' fees) actually and reasonably incurred by
him or her in connection with the defense or settlement of such action or suit
if he or she acted in good faith and in a manner he or she reasonably believed
to be in or not opposed to the best interests of Digital Lava, provided that no
indemnification may be made in respect of any claim, issue or matter as to which
such person has been adjudged to be liable to Digital Lava unless and only to
the extent that the Delaware Court of Chancery or the court in which such action
or suit was brought determines upon application that, despite the adjudication
of liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the Delaware
Court of Chancery or such other court deems proper.
Pursuant to its Bylaws, Digital Lava has the power to purchase and maintain
a directors and officers liability policy to insure its officers and directors
against certain liabilities.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
registrant pursuant to the foregoing provisions, the registrant has 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.
ITEM 16. EXHIBITS.
Please see Index of Exhibits below.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(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) Securities
Act of 1933 (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 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% change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
Registration Statement;
(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 the Registration Statement;
PROVIDED, HOWEVER, that paragraphs A(l)(i) and A(l)(ii) do not apply if the
Registration Statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act") that are incorporated by reference in the Registration
Statement;
II-2
<PAGE>
(2) That, for the purpose of determining any liability under the Securities
Act, 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
this offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement 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.
Insofar as indemnification for liabilities arising under the Securities Act
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 SEC such indemnification is against
public policy as expressed in the Securities 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 Securities Act and will be governed by the final
adjudication of such issue.
II-3
<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, thereunto duly
authorized, in the City of Marina del Rey, California, on September 11, 2000.
DIGITAL LAVA INC.
By: /S/ ROBERT GREENE
-------------------------------------
Robert Greene
Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below does hereby constitute and
appoint Robert Greene, Danny Gampe and Joshua Sharfman, and each of them, with
full power of substitution and full power to act without the other, his true and
lawful attorney-in-fact and agent to act for him in his name, place and stead,
in any and all capacities, to sign any or all amendments (including
post-effective amendments) to this registration statement on Form S-3, or any
registration statement for the same offering that is to be effective upon filing
pursuant to Rule 462(b) under the Securities Act of 1933, and to file the same,
with all exhibits thereto, and other documents in connection therewith or in
connection with the registration of the common stock under the Securities
Exchange Act of 1934, as amended, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents, and each of them, full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully, to all intents and purposes, as they or he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, may lawfully do or cause to be done by virtue hereof.
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/ ROBERT GREENE Chairman of the Board and Chief Executive Officer September 11, 2000
----------------------------------- (PRINCIPAL EXECUTIVE OFFICER)
Robert Greene
/S/ DANNY GAMPE Chief Financial Officer (PRINCIPAL FINANCIAL AND September 11, 2000
----------------------------------- ACCOUNTING OFFICER)
Danny Gampe
/S/ JOSHUA SHARFMAN President and Chief Technology Officer September 11, 2000
-----------------------------------
Joshua D.J. Sharfman
/S/ ROGER BERMAN Director September 11, 2000
-----------------------------------
Roger Berman
/S/ JOHN CARRINGTON Director September 11, 2000
-----------------------------------
John Carrington
/S/ MICHAEL WHEELER Director September 11, 2000
-----------------------------------
Michael Wheeler
</TABLE>
II-4
<PAGE>
INDEX OF EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
------- -----------
4.1 Registration Rights Agreement dated as of July 26, 2000,
between Digital Lava Inc. and each of the Investors named
therein (incorporated by reference to Exhibit 1 to the Form 8-K
filed by Digital Lava on July 31, 2000).
5.1 Opinion of Latham & Watkins.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Latham & Watkins (included in Exhibit 5.1).
24.1 Power of Attorney (included on page II-4).
II-5
