As filed with the Securities and Exchange Commission on June 15, 2000.
Registration No.
============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
---------------
SCIENCE DYNAMICS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 22-2011859
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1919 Springdale Road
Cherry Hill, New Jersey 08003-1069
(856) 424-0068
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Joy C. Hartman, President
1919 Springdale Road
Cherry Hill, New Jersey 08003-1069
(856) 424-0068
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy To:
Stephen M. Robinson, Esq.
Stephen M. Robinson, P.A.
172 Tuckerton Road
Medford, NJ 08055
-----------------------
Approximate date of commencement of proposed sale to the public: On such date
as the selling stockholders shall elect to commence sales to the public
following the effective date of this registration statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. |_|
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
CALCULATION OF REGISTRATION FEE
=============================================================================
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Title of each Number of Proposed
class of shares to maximum Proposed maximum Amount of
securities to be offering price aggregate registration
be registered registered per share(1) offering price fee
-----------------------------------------------------------------------------
Common Stock
par value $.01
per share 618,650 $7.88 $4,875,750 $1,287.20
=============================================================================
</TABLE>
(1) Based on the average of the bid and ask prices of the Common
Stock quoted on the Nasdaq OTC Bulletin Board on June 7,2000 of
$7.75 and $8.00 per share, solely for the purpose of calculating the
registration fee pursuant to Rule 457(c).
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.
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<PAGE>
Subject to Completion
Dated June 15, 2000
Prospectus
Science Dynamics Corporation
Common Stock
618,650 Shares
This is an offering of 618,650 shares for the benefit of the selling
stockholders. They may elect from time to time to sell their shares but are
not required to do so. We will not receive any of the sale proceeds. We are
paying all the expenses of the offering.
Our Common Stock is traded on the Nasdaq Over the Counter Bulletin Board
under the symbol "SIDY". Our Common Stock has been traded publicly since
April 22, 1981. The last reported bid price of our common stock on
June 7, 2000 was $.7.75 per share.
Investing in the Company involves a high degree of risk. You should
purchase shares only if you can afford a complete loss. You should
carefully read and review this prospectus including the "Risk Factors"
beginning on page 6 before deciding whether to buy shares in this Offering.
The Securities and Exchange Commission has not approved or disapproved of
these securities or determined if this prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.
Prospectus dated June , 2000.
2
<PAGE>
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TABLE OF CONTENTS
Page
----
Incorporation of Certain Information
by Reference.............................3
Prospectus Summary ......................4
Risk Factors ............................6
Use of Proceeds.........................11
Selling Stockholders ...................11
Plan of Distribution ...................12
Disclosure of Commission Position on
Indemnification For Securities Act
Liabilities...........................13
Legal Matters ..........................13
Experts.................................13
Where You Can Find More Information.....13
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
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 to those documents. The information incorporated by reference is
an important part of this prospectus, and information that we file later
with the Commission will automatically update and supersede this information.
We incorporate by reference the following documents filed by us with
the SEC:
- Our Annual Report on Form 10-KSB for the year ended December 31, 1999
filed with the SEC on March 30, 2000;
- Our Quarterly Report on Form 10-QSB for the period ended March 31, 2000
filed with the SEC on May 15, 2000;
- All other reports and other documents filed by us pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 ("Exchange Act") since
the December 31, 1998 Form 10-KSB;
- All documents and reports subsequently filed by us pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
prospectus and prior to the filing of a post-effective amendment which
indicates that all securities which may be offered hereby have been sold or
which deregisters all securities then remaining unsold.
At your request, we will provide you, without charge, with a copy of
any information incorporated by reference in this prospectus. If you want
more information, write or call us at:
Science Dynamics Corporation
1919 Springdale Road
Cherry Hill, New Jersey 08003-1069
(856) 424-0068
You may also obtain information from the SEC as described in "Where You
Can Find More Information."
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<PAGE>
PROSPECTUS SUMMARY
We have provided you with a summary of important information on our
business. You should read all the information in this prospectus for a more
complete understanding. Some of the information has been incorporated from
our SEC filings. You can obtain copies of this incorporated information from
us without charge as described beginning on page 3. Please be sure to read
"Risk Factors" beginning on page 6 for a description of the high risk involved
in acquiring our shares.
THE COMPANY
Principal Executive Science Dynamics Corporation
Offices: 1919 Springdale Road
Cherry Hill, New Jersey 08003-1069
(856) 424-0068
Our Business:
Science Dynamics Corporation (the "Company" or "SciDyn") was incorporated in
the State of Delaware May 1973 and commenced operations in July 1977. During
the past 22 years the Company has developed, designed and marketed a variety
of Telecommunications systems, including intelligent call processing platforms,
which provide telecommunications service capabilities to the public switched
telephone network (PSTN). These platforms are sophisticated software based
systems, which satisfy a wide range of computer telephony integration
applications. In November 1996, the Company acquired the intellectual
property of Innovative Communications Technology (ICT) and embarked on
transforming the Company into a predominately software design and system
integration Company.
Over the past few years, the challenge was to expand the product offerings
and migrate into additional markets within the Computer Telephony Integration
(CTI) industry. The Company believes that communicating via packet networks
such as ATM, Frame Relay and the Internet is becoming the preferred strategy
for both public networks and business enterprises. The Company's focus is to
address niche market opportunities in Data Network Companies, Telephone
Service Distributors and Regional Bell Operating Companies (RBOC's), and
large independent telephone operating companies.
The Company's development is driven by user needs for cost effective, easy
to use multiservice products that provide an array of telecommunications
solutions and services to the customers. These opportunities are primarily
in the areas of Voice over Internet Protocol, Inmate Systems, Video over Frame
Relay, Voice Announcements, Interactive Communications, Intelligent Network
Control and Administration. The Company's strategy today is to deliver
quality software products and services that empower its customers to improve
their applications and deploy quality services worldwide.
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<PAGE>
BUSINESS DEVELOPMENT
--------------------
Science Dynamics is continuing to focus its strategy on becoming a key
provider of enabling technologies required for the convergence of traditional
and new communications media infrastructures.
The telecommunications industry is still moving forward with the early stages
of shifting traditional circuit switched traffic such as voice and fax to
new packet based networks. The market for products and technology to enable
the shift of these established services to lower cost and more advanced data
networks is growing faster then ever. It will take many years to displace a
major portion of the currently installed circuit switched infrastructure.
This provides two major opportunities in the next few years. First a need
to bridge the old circuit switched networks with newer packet based networks.
This challenge demands high quality dependable gateway equipment and services.
Second new emerging carriers building from the ground up on these advanced
packet based networks require equipment that can help them offer the services
and features that are currently deployed in the existing circuit switched
networks. Certainly the deciding factor will be up to the public and
corporate users of these networks. Traditional telecom carriers are
currently in an intense battle to keep customers and prevent costly churning
of user accounts. Offering more advanced features with realizable benefits
to the end user is the key to winning this battle. This will hold true as
packet based network providers attempt to lure customers to their new
technology. One key factor here is the ability to provide new features at a
faster pace then competition. Packet based networks and much of the technology
supporting this network relies more heavily on software driven systems. These
systems along with the inherent ability of these networks to overcome distance
and access to data obstacles means a greater ability to provide features
quickly and more creatively then ever before.
Management believes that current products and development strategy teamed
with Science Dynamics strong telecommunications background will provide a
solid product to meet today's needs and the advancements required to progress
the packet based telecom revolution.
THE OFFERING
Securities Offered: 618,650 shares. The shares are being offered by the
selling stockholders. See "Plan of Distribution."
Shares Outstanding: There were 17,644,801 shares outstanding (does not
include an additional 125,800 shares of Treasury
Stock) as of June 7, 2000.
Estimated Offering
Expenses: $9,000.
Risk Factors: Investing in our shares is very risky. Investors
should be able to bear the complete loss of their
investment.
Use of Proceeds: The proceeds of this offering will be paid to the
selling stockholders. None of the proceeds will be
paid to the Company. See "Use of Proceeds."
Trading Symbol: "SIDY"
5
<PAGE>
RISK FACTORS
WE HAVE HAD LOSSES AND THERE MAY BE FURTHER LOSSES
We incurred net losses of $2,054,886 for the year ended December 31, 1999 and
$1,036,306 for the year ended December 31, 1998. We cannot assure you that
we can sustain or increase profitability on a quarterly or annual basis in
the future. If revenues grow more slowly than we anticipate, or if operating
expenses exceed our expectations or cannot be adjusted accordingly, our
business, results of operations and financial condition will be materially and
adversely affected.
OUR MARKETS ARE COMPETITIVE
Due to the diversified nature of the products and target markets, our
competition varies greatly by product line. Our Inmate Products division
holds a respectable portion of the Inmate market with the Commander system.
We compete against three other primary vendors in this area but the system
captures a sizable share of the target market.
We have limited competition in the Video-Over-Frame market. Competing
products include integrated Frame Relay Codec, an ISDN over Frame Relay
product and the use of H.323 packetized LAN Video, a different concept which
crosses into our market.
Our IP products will compete in a marketplace that is populated by larger
companies who have significantly more resources for development, marketing
and deployment. We may not be able to compete successfully against current
or future competitors, and competitive pressures could significantly harm us.
RISKS OF BUSINESS COMBINATIONS AND STRATEGIC ALLIANCES
We may expand our operations or market presence by entering into business
combinations, investments, joint ventures or other strategic alliances with
other companies. These transactions create risks such as:
- Difficulty assimilating the operations, technology and personnel
of the combined companies,
- Disruption of our ongoing business,
- Problems retaining key technical and managerial personnel,
- Expenses associated with amortization of goodwill and other
purchased intangible assets,
- Additional operating losses and expenses of acquired
businesses, and
- Impairment of relationships with existing employees,
customers and business partners.
We may not succeed in addressing these risks.
WE MAY NEED ADDITIONAL FUNDS TO EXPAND OUR SALES AND MARKETING ACTIVITIES,
RESEARCH AND DEVELOPMENT, AND STRATEGIC ALLIANCES.
Based on current levels of operations and planned growth, we anticipate that
our existing capital resources, together with cash generated from operations
will enable us to maintain our operations for the next 12 months. We may
require additional funds to sustain and expand our sales and marketing
activities, research and development, and our strategic alliances, particularly
if a well-financed competitor emerges or if there is a rapid technological
shift in the telecommunications industry. There can be no assurance that
financing will be available in amounts or on terms acceptable to us, if at
all. The inability to obtain sufficient funds from operations and external
sources would have a material adverse effect on our business.
6
<PAGE>
WE DEPEND ON KEY PERSONNEL.
We depend on the continued services and on performance of our senior
management and other key personnel, particularly Joy C. Hartman, our
President, CEO, Secretary and Treasurer, and Alan C. Bashforth, our Chairman
of the Board of Directors and Consultant. Our success also depends on our
ability to retain and motivate our other officers and key employees. The loss
of the services of any of our executive officers or other key employees could
harm our business. Our future success also depends on our ability to attract
and retain and motivate other highly skilled engineering, technical, sales,
marketing and customer service personnel. Competition for such personnel is
intense, and there can be no assurance that we will be able to successfully
attract, assimilate or retain sufficiently qualified personnel which could
harm our business.
WE ARE RELIANT UPON CERTAIN SUPPLIERS, THE LOSS OF ANY OF WHICH COULD BE
DISRUPTIVE TO OUR BUSINESS, REDUCE OUR OPPORTUNITIES FOR PROFITABILITY AND
CAUSE THE PRICE OF OUR STOCK TO FALL.
Although most of the components used in our products are available from a
number of different suppliers on an off-the-shelf basis, certain components
are purchased from sole source suppliers. If such a supplier should cease to
deliver a component, another source would have to be developed. Acquiring a
substitute part or module may require a hardware or software change in the
unit in order to provide satisfactory performance, adding costs and delays of
unknown amount and duration.
OUR REVENUES ARE GENERATED AMONG A RELATIVELY SMALL NUMBER OF CUSTOMERS. THE
LOSS OF ANY ONE OR MORE OF THESE CUSTOMERS WOULD GREATLY REDUCE OUR
OPPORTUNITIES TO ACHIEVE AND SUSTAIN PROFITABILITY AND MAY CAUSE A REDUCTION
IN THE MARKET PRICE OF OUR STOCK.
A majority of our sales have been attributable to a relatively small number
of customers. For example, our major customers, independent and Bell
Operating Companies, accounted for 82.95%, 4.69% and 3.45% of total revenue
in 1998. If one or more of our large-volume customers were to discontinue
doing business with us, our results of operations would be materially and
adversely affected. In addition, the irregular timing of large orders and
their materiality to our total revenues for any given reporting period has
caused, and is expected to cause, substantial volatility in our operating
results. However, with the introduction of the new product lines, we have
expanded our customer base globally and should be less reliant on any single
market or territory.
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<PAGE>
WE MAY BE UNABLE TO PROTECT OUR INTELLECTUAL PROPERTY
We regard substantial elements of our software products as proprietary
and attempt to protect them by relying on patent, trademark, service mark,
trade dress, copyright, and trade secret laws and restrictions, as well as
confidentiality procedures and contractual provisions. Any steps we take to
protect our intellectual property may be inadequate, time consuming, and
expensive. In addition, despite our efforts, we may be unable to prevent
third-parties from infringing upon or misappropriating our intellectual
property. Any such infringement or misappropriation could have a material
adverse effect on our business, results of operations, and financial
condition. Currently issued patents or any new patent applications may not
provide us with any competitive advantages, or may be challenged by third
parties. Effective trademark, copyright, and trade secret protection may not
be available in every country in which our products are distributed. In
addition, our competitors may independently develop similar technology that
substantially limits the value of our intellectual property.
OTHERS MAY BRING INTELLECTUAL PROPERTY INFRINGEMENT CLAIMS AGAINST US
In addition to the technology we have developed internally, we also have
acquired or licensed technologies from other companies. Our internally
developed technology or the technology we acquired or licensed may infringe
on a third party's intellectual property rights and such third parties may
bring claims against us alleging infringement of their intellectual property
rights. Any such infringement or claim of infringement could have a material
adverse affect on our business, result of operations, and financial condition.
8
<PAGE>
In recent years, there has been significant litigation in the United
States involving patents and other intellectual property rights. We are not
currently involved in any intellectual property litigation. We may, however,
be a party to litigation in the future to protect our intellectual property
or as a result of an alleged infringement of others' intellectual property.
Such claims and any resulting litigation could subject us to significant
liability for damages and invalidation of our proprietary rights. Such
litigation, regardless of its success, likely would be time-consuming and
expensive to defend and would divert management time and attention. Any
potential intellectual property litigation could also force us to do one or
more of the following:
- Cease selling, incorporating, or using products or services
that incorporate the challenged intellectual property;
- Obtain from the holder of the infringed intellectual property
right a license to sell or use the relevant technology, which
license may not be available on reasonable terms, or at all; and
- Redesign those products or services that incorporate such
technology.
Any of these results could have a material adverse effect on our business,
results of operations, and financial condition.
WE MAY NEVER PAY DIVIDENDS ON OUR COMMON STOCK, IN WHICH EVENT PURCHASERS'
ONLY RETURN ON THEIR INVESTMENT, IF ANY, WILL OCCUR ON THE SALE OF OUR STOCK.
We have never declared or paid a cash dividend. We presently intend to retain
any future earnings for use in the business and do not presently intend to
pay cash dividends in the foreseeable future.
INDEMNIFICATION AND LIMITATION OF LIABILITY OF OUR OFFICERS AND DIRECTORS
MAY INSULATE THEM FROM ACCOUNTABILITY TO STOCKHOLDERS AT SUBSTANTIAL COST TO
SCIENCE DYNAMICS
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Our by-laws include provisions whereby our officers and directors are to
be indemnified against liabilities to the fullest extent permissible under
Delaware law. Our by-laws also limit a director's liability for monetary
damages for breach of fiduciary duty, including gross negligence. In addition,
we have agreed to advance the legal expenses of our officers and directors
who are required to defend against claims. These provisions and agreements
may have the effect of reducing the likelihood of suits against directors and
officers even though such suits, if successful, might benefit us and our
stockholders. Furthermore, your investment may be adversely affected if we
pay the cost of settlement and damage awards against directors and officers.
A LARGE BLOCK OF SHARES CAN BE SOLD UNDER RULE 144.
Owners of a large block of shares which were previously restricted can be
sold under Rule 144. The sale of a large number of these shares could lower
the price of our shares or make it harder to attract new investors.
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<PAGE>
Special Note Regarding Forward-looking Statements
Some of the statements contained in this prospectus, including
information incorporated by reference, discuss future expectations, contain
projections of future results of operations or financial condition or state
other "forward-looking" information. Those statements are subject to known
and unknown risks, uncertainties and other factors that could cause the
actual results to differ materially from those contemplated by the statements.
The forward-looking information is based on various factors and was derived
using numerous assumptions. Important factors that may cause actual results
to differ from projections include the risk factors set forth above.
USE OF PROCEEDS
All of the shares which may be sold pursuant to this prospectus will be
sold from time to time by the selling stockholders for their own accounts or
by pledgees, donees, transferees or other successors in interest thereof.
The Company will receive no proceeds from any such sales of shares.
SELLING STOCKHOLDERS
The following table sets forth the number of shares of Common Stock
beneficially owned by each of the selling stockholders as of the date hereof,
the number of shares owned by them covered by this prospectus and the amount
and percentage of shares to be owned by each selling stockholder after the
sale of all of the shares offered by this prospectus. None of the selling
stockholders has had any position, office or other material relationship with
the Company within the past three years other than as a result of the
ownership of the shares or other securities of the Company. The information
included below is based on information provided by the selling stockholders.
Because the selling stockholders may offer some or all of their shares, no
definitive estimate as to the number of shares that will be held by the
selling stockholders after such offering can be provided and the following
table has been prepared on the assumption that all shares of Common Stock
offered hereby will be sold.
Shares
Owned Percentage of
Shares of After Shares Owned
Beneficially Shares Offering After Offering
Name Owned Offered (1) (1)
-------------------------- --------- ------- -------- -------------
Aristella Ltd. 28,000 28,000 0 0.0%
Husky International Inc. 440,000 440,000 0 0.0%
Calmuny Limited 17,650 17,650 0 0.0%
Fidulex Management, Inc. 50,000 50,000 0 0.0%
James L. Britt 5,000 5,000 0 0.0%
Jeffrey J. Britt 41,063 18,000 23,063 *
Aberfoyle, Ltd. 227,500 10,000 217,500 1.3%
Zeke, L.P. 50,000 50,000 0 0.0%
----------
(1) Assumes sale of all shares offered by the selling stockholders.
* Less than one percent
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PLAN OF DISTRIBUTION
The shares are being registered in order to facilitate their sale from
time to time by the selling stockholders, or by pledgees, donees, transferees
or other successors in interest thereof, as market conditions permit in one
or more transactions. No underwriting arrangements have been entered into
by the selling stockholders. In addition, as none of the selling stockholders
have advised the Company whether or not they have any current intention of
selling any of the shares, the Company is unable to predict whether or when
any of the selling stockholders will determine to proceed with sales of the
shares, as such determination will be made solely at the discretion of each
selling stockholder. The distribution of the shares by the selling
stockholders and/or their pledgees, donees, transferees or other successors
in interest, may be effected in one or more transactions that may take place
on the over-the-counter market, including ordinary brokers transactions,
privately negotiated transactions or through sales to one or more dealers for
resale of the shares as principals, or a combination of such methods of sale,
at market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The shares may be sold by
one or more of the following methods, without limitation: (a) a block trade
in which a broker or dealer so engaged will attempt to sell the shares as
agent but may position and resell a portion of the block as principal to
facilitate the transaction; (b) purchases by a broker or dealer as principal
and resale by such broker or dealer for its account pursuant to this
prospectus; (c) ordinary brokerage transactions and transactions in which the
broker solicits purchasers; and (d) face-to-face transactions between sellers
and purchasers without a broker-dealer. In effecting sales, brokers or
dealers engaged by the selling stockholder may arrange for other brokers or
dealers to participate. Such brokers or dealers may receive commissions or
discounts from the selling stockholders in amounts to be negotiated
immediately prior to the sale. The selling stockholders and such brokers and
dealers and any other participating brokers or dealers may be deemed to be
"underwriters" within the meaning of the Securities Act, in connection with
such sales. The Company has agreed to bear all expenses of registration of
the shares.
The Company will receive no proceeds from any sales of the shares
offered hereby by the selling stockholders. The Company has agreed to pay
the filing fees, costs and expenses associated with the registration
statement excluding fees of counsel to the selling stockholders, but
including fees relating to compliance with state blue sky requirements,
commissions and discounts of underwriters, dealers or agents, if any, and any
stock transfer taxes.
The Company has agreed to indemnify the selling stockholders, or their
transferees or assignees against certain liabilities, including liabilities
under the Securities Act.
12
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DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Section 145 of the General Corporation Law of Delaware grants each
corporation organized thereunder the power to indemnify its officers,
directors, employees and agents on certain conditions against liabilities
arising out of any action or proceeding to which any of them is a party by
reason of being such officer, director, employee or agent. The Certificate
of Incorporation also provides for the indemnification, to the fullest extent
permitted by the General Corporation Law of Delaware, of such persons.
Insofar as indemnification for liabilities arising under the Securities Act,
may be permitted to directors, officers or persons controlling the Company
pursuant to the foregoing provisions, the Company has been informed that in
the opinion of the Commission such indemnification is against public policy
as expressed in the Securities Act and is therefore unenforceable.
LEGAL MATTERS
The validity of the shares offered hereby is being passed upon for the
Company by Stephen M. Robinson, P.A., 172 Tuckerton Road, Medford, NJ 08055.
EXPERTS
The consolidated financial statements and schedule incorporated by
reference in this prospectus and elsewhere in the registration statement have
been audited by Peter C. Cosmas Co., CPAs, independent public accountants, as
indicated in their reports with respect thereto, and are included herein in
reliance upon authority of the said firm as experts in accounting and
auditing.
WHERE YOU CAN FIND MORE INFORMATION
We have filed a registration statement which includes this prospectus
covering this offering with the Securities and Exchange Commission ("SEC").
This prospectus does not contain all the information included in the
registration statement. You can request a copy of the registration statement
and the exhibits from us to get a more complete description of our Company
and this offering. We have provided our address, telephone number and e-mail
address in the section "Incorporation of Certain Information by Reference" if
you wish to obtain free copies of the registration statement and exhibits.
We file annual, quarterly and current reports, proxy statements and
other information with the SEC. You may read and copy any reports, statements
or other information we file at the SEC's public reference room in Washington
D.C., New York, New York and Chicago, Illinois. You can also request copies of
these documents, upon payment of a duplicating fee, by writing to the SEC.
Please call the SEC at 1-800-SEC-0330 for further information on the operation
of the public reference rooms. Our SEC filings are also available to the
public on the SEC Internet site at http:\\www.sec.gov. The registration
statement, of which this prospectus forms a part, including all exhibits,
has been filed in electronic form with the SEC through EDGAR.
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============================================================================
Until ___________, all dealers that effect transactions in these securities
may be required to deliver a prospectus.
We have not authorized any person to give any information or to make any
representations other than those contained in this prospectus. You must not
rely upon any information or representation not contained or incorporated by
reference in this prospectus as if we had authorized it. If any person does
make a statement that differs from what is in this prospectus, you should
not rely on it. This prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any securities other than the securities to
which they relate nor does this prospectus constitute an offer to sell or the
solicitation of an offer to buy securities in any state or other jurisdiction
to any person to whom it is unlawful to make such offer or solicitation in
such jurisdiction. The information contained in this prospectus is accurate
as of the date of its cover. When we deliver this prospectus or make a sale
pursuant to this prospectus, we are not implying that the information is
current as of the date of the delivery of the sale.
=============================================================================
618,650 Shares
SCIENCE DYNAMICS CORPORATION
Common Stock
_______________
PROSPECTUS
_______________
June , 2000
=============================================================================
14
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INFORMATION NOT REQUIRED IN THE PROSPECTUS
The Company will bear no expenses in connection with any sale or other
distribution by the selling stockholders of the shares being registered other
than the expenses of preparation and distribution of this registration
statement and the prospectus included in this registration statement. Such
expenses are set forth in the following table. All of the amounts are
estimates except the Securities and Exchange Commission filing fee.
Item 14. Other Expenses of Issuance and Distribution.
SEC registration fee .....................$1,287.20
Accounting fees and expenses..............$2,500.00
Legal fees and expenses.................. $5,000.00
Printing expenses.........................$ 100.00
Miscellaneous.............................$ 112.80
Total................................. $9,000.00
Item 15. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law (the "DGCL")
provides that a corporation may indemnify its directors and officers, as well
as other employees and individuals, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement in connection with
specified actions, suits or proceedings, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the corporation - a "derivative action"), if they acted in good faith and in
a manner they reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe their conduct was unlawful. A
similar standard is applicable in the case of derivative actions, except that
indemnification only extends to expenses (including attorneys' fees) incurred
in connection with the defense or settlement of such actions, and the statute
requires court approval before there can be any indemnification in which the
person seeking indemnification has been found liable to the corporation. The
statute provides that it is not exclusive of other indemnification that may
be granted by a corporation's charter, bylaws, disinterested director vote,
stockholder vote, agreement or otherwise.
The Registrant's Bylaws require that the Corporation shall indemnify to
the full extent authorized by law any person made or threatened to be made a
party to any action, suit or proceeding, whether criminal, civil,
administrative or investigative, by reason of the fact that he, his testator
or intestate is or was a director, officer or employee of the Corporation or
any predecessor of the Corporation or serves or served any other enterprise
as a director, officer or employee at the request of the Corporation or any
predecessor of the Corporation.
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Section 102(b)(7) of the DGCL permits a corporation to provide in its
certificate of incorporation that a director of the corporation shall not be
personally liable to the corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director, except for liability for (1) any
breach of the director's duty of loyalty to the corporation or its
stockholders, (2) acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (3) payments of
unlawful dividends or unlawful stock repurchases or redemptions, or (4) any
transaction from which the director derived an improper personal benefit.
The Registrant's Certificate of Incorporation provides that to the
full extent that the DGCL, as it now exists or may hereafter be amended, a
director of the Registrant shall not be liable to the Registrant or its
stockholders for monetary damages for breach of fiduciary duty as a director.
Any amendment to or repeal of such provision shall not adversely affect any
right or protection of a director of the Registrant existing at the time of
such repeal or modification.
Insurance for the Registrant's directors and officers, against expenses
and liabilities in connection with the defense of actions, suits or
proceedings to which they may be parties by reason of having been directors
or officers of the Registrant, is provided by the Registrant.
Item 16. Exhibits.
Exhibit Description
-------- -----------
1 Not Applicable
2 Not Applicable
4 Not Applicable
5 Opinion of Stephen M. Robinson, P.A., filed herewith
8 Not Applicable
15 Not Applicable
23.1 Consent of Peter C. Cosmas Co., CPAs, filed herewith
23.2 Consent of Stephen M. Robinson, P.A. (included in the opinion
filed as Exhibit No. 5)
24 Not Applicable
25 Not Applicable
26 Not Applicable
27 Not applicable
16
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Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) 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 of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the information
set forth in the registration statement;
(iii) To include any additional or changed material information
with respect to the plan of distribution:
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required in a post-effective amendment is incorporated by
reference from periodic reports filed with the Commission by the registrant
pursuant to section 13 or section 15(d) of the Securities Exchange Act of
1934 (the "Exchange Act").
(2) That, for the purpose of determining any liability under the
Securities Act, the undersigned will treat each such post-effective
amendment as a new registration statement of the securities offered, and the
offering of the securities at that time to be the initial bona fide offering
thereof.
(3) To file a post-effective amendment to remove from registration any
of the securities that remain unsold at the end of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Company'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.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Company, pursuant to the provisions described in Item 15
above, or otherwise, the Company has been advised 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.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Company of expenses incurred or paid by a director,
officer or controlling person of the Company in the successful defense of any
action, suit or proceeding) is asserted by any such director, officer or
controlling person in connection with the securities being registered, the
Company 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 of whether or not such indemnification is against
public policy as expressed in the Securities Act and will be governed by the
final adjudication of such issue.
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(d) The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and Rule 424(b)(1) or (4)
or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus 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
the initial bona fide offering thereof.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused
this registration statement on Form S-3 to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Cherry Hill in the
State of New Jersey on June 15, 2000.
SCIENCE DYNAMICS CORPORATION
By /s/ Joy C. Hartman
--------------------------------------
Joy C. Hartman
President
Pursuant to the requirements of the Securities Act of 1933, this
registration statement on Form S-3 has been signed by the following persons
in the capacities and on the dates indicated.
Signature Date
/s/ Alan C. Bashforth June 15, 2000
----------------------------------
Alan C. Bashforth
Chairman of the Board of Directors
/s/ Joy C. Hartman June 15, 2000
----------------------------------
Joy C. Hartman
President, CEO, Treasurer,
Secretary, and Director
/s/ Kenneth P. Ray June 15, 2000
----------------------------------
Kenneth P. Ray
Director
/s/ Sheldon Hofferman June 15, 2000
----------------------------------
Sheldon Hofferman
Director
/s/ Anand Kumar June 15, 2000
----------------------------------
Anand Kumar
Director
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