<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________
SCHEDULE 13D
(AMENDMENT NO. 3)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
ADVANCE DISPLAY TECHNOLOGIES, INC.
______________________________________________________________________________
(Name of Issuer)
Common Stock, $.001 par value
______________________________________________________________________________
(Title of Class of Securities)
007422306
______________________________________________________________________________
(CUSIP Number)
John F. Knoeckel, Esq.
Holme Roberts & Owen LLP
1700 Lincoln Street, Suite 4100
Denver, Colorado 80203
(303) 861-7000
______________________________________________________________________________
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
See Item 5
______________________________________________________________________________
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box / /.
Check the following box if a fee is being paid with the statement / /.
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 2 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Display Optics, Ltd., a Colorado limited partnership
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
State of Colorado
7 SOLE VOTING POWER
-0-
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
-0-
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.0%
14 TYPE OF REPORTING PERSON
PN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 3 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Display Group LLC, a Colorado limited liability company
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
BK, AF, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
State of Colorado
7 SOLE VOTING POWER
1,715,030
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 350,000
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
1,715,030
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.0%
14 TYPE OF REPORTING PERSON
OO
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 4 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Keith A. Hancock
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
76,045
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 76,045
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
76,045
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.4%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 5 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
G. Schneider Holdings Co., a Colorado limited partnership
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC, BK
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
State of Colorado
7 SOLE VOTING POWER
4,941,959
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 4,941,959
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
4,941,959
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
23.2%
14 TYPE OF REPORTING PERSON
PN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 6 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Gene W. Schneider
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
4,941,959
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 4,941,959
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
4,941,959
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
23.2%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 7 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
William W. Becker
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Canada
7 SOLE VOTING POWER
1,873,369
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 1,873,369
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
1,873,369
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.8%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 8 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Mark L. Schneider
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF, BK
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
2,509,173
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 2,509,173
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
2,509,173
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
11.8%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 9 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Jan E. Helen
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF, BK
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Norway
7 SOLE VOTING POWER
1,126,797
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 1,126,797
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
1,126,797
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.3%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 10 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
William J. Elsner
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
1,126,812
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 1,126,812
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
1,126,812
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.3%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 11 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
J. Timothy Brittan
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF, BK
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
842,492
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 842,492
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
842,492
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
4.0%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 12 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Bruce H. Etkin
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
3,247,456
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 3,247,456
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
3,247,456
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
15.2%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 13 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Peregrine Investments, a Virginia general partnership
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
State of Virginia
7 SOLE VOTING POWER
760,450
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 760,450
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
760,450
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES /X/
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.6%
14 TYPE OF REPORTING PERSON
PN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 14 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Daryl H. Owen
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
-0-
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED 760,450
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
760,450
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
760,450
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.6%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 15 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Lindsay D. Hooper
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
-0-
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED 760,450
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
760,450
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
760,450
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.6%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 16 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
James C. Gould
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
-0-
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED 760,450
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
760,450
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
760,450
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.6%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 17 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
John D. Seiver
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
118,630
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 118,630
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
118,630
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.6%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 (SCHEDULE 13D AMENDMENT NO. 3) Page 18 of 29
______________________________________________________________________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
John P. Cole, Jr.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
886,685
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED -0-
BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 886,685
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THIS REPORTING PERSON
886,685
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
4.2%
14 TYPE OF REPORTING PERSON
IN
______________________________________________________________________________
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 19 of 29
This statement, dated June 12, 1997 ("Amendment No. 3"), is Amendment No. 3
to the Schedule 13D, dated December 19, 1996, as previously amended through
Amendment No. 1 to Schedule 13D, dated January 29, 1997, and Amendment No. 2 to
Schedule 13D, dated March 19, 1997 (collectively, the "Schedule 13D"), that was
filed on behalf of the reporting persons (as defined in Item 2(a) of this
Amendment No. 3), with respect to the common stock of Advance Display
Technologies, Inc. All information set forth in the Schedule 13D previously
filed is hereby incorporated into this Amendment No. 3 by this reference. This
Amendment No. 3 is filed in accordance with Rule 13d-2 of the Securities
Exchange Act of 1934.
ITEM 1. SECURITY AND ISSUER.
- ----------------------------
The class of equity securities to which this Amendment No. 3 relates is
Common Stock, $.001 par value (the "Common Stock").
The issuer of the Common Stock is Advance Display Technologies, Inc., a
Colorado corporation ("Issuer"), whose principal executive offices are located
at 1251 South Huron, Unit C, Denver, Colorado 80223.
ITEM 2. IDENTITY AND BACKGROUND.
- --------------------------------
(a), (b) and (c) This Amendment No. 3 is filed on behalf of each of the
----------------
following persons (the "Reporting Persons"), with respect to the Common Stock
described in this Amendment No. 3. The Reporting Persons previously made single
joint filings pursuant to Rule 13d-1(f) as a precautionary matter in the event
that they were deemed to comprise one or more "groups" within the meaning of
section 13(d)(3) of the Securities Exchange Act of 1934 (the "Act"). However,
each of the Reporting Persons disclaimed the existence of any such group and
each Reporting Person disclaimed beneficial ownership of securities owned by the
other Reporting Persons except as specifically stated otherwise in the Schedule
13D. Based on the transactions described below in Item 4, the Reporting Persons
have determined that they will no longer report jointly under Section 13(d) of
the Securities Exchange Act of 1934 and related regulations of the Securities
and Exchange Commission (collectively, including such Act, "Section 13(d)").
Accordingly, this Amendment No. 3 is the last joint filing by the Reporting
Persons. Subsequent filings will be made individually by the Reporting Persons
to the extent that the individual Reporting Persons are required to file under
Section 13(d). The Reporting Persons include the following:
(1) Display Optics Ltd., a Colorado limited partnership ("Display
Optics"), whose general partners are Issuer and Display Group LLC, a Colorado
limited liability company ("Display Group"). The executive officers and
directors of Issuer are
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 20 of 29
Darrell D. Avey, John Kilgore and Vince Bradshaw./1/ The manager of Display
Group is Keith A. Hancock. As discussed below, Display Optics is now wholly
owned by Issuer.
(2) Display Group, whose manager is Keith A. Hancock. As discussed
below, Display Group is now wholly owned by the Issuer.
(3) Keith A. Hancock
(4) G. Schneider Holdings Co., a Colorado limited partnership ("GS
Holdings"), whose general partner is Gene W. Schneider.
(5) Gene W. Schneider
(6) William W. Becker
(7) Mark L. Schneider
(8) Jan E. Helen
(9) William J. Elsner
(10) J. Timothy Brittan
(11) Bruce H. Etkin
(12) Peregrine Investments, a Virginia general partnership ("Peregrine
Investments"), whose general partners are Daryl H. Owen, Lindsay D. Hooper, and
James C. Gould.
(13) Daryl H. Owen
(14) Lindsay D. Hooper
(15) James C. Gould
(16) John D. Seiver
(17) John P. Cole, Jr.
- --------------
/1/ Michael A. Nixon was a director of Issuer through March 5, 1997.
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 21 of 29
The residence or business address, and the present principal occupation or
employment of each reporting person has been set forth in the Schedule 13D
previously filed.
(d) and (e) None of the persons identified in Item 2(a) has, during the
-----------
last five years, (i) been convicted in a criminal proceeding or (ii) been a
party to a civil proceeding and as a result of which was or is subject to a
judgment, decree, or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws, or a
judgment, decree, or final order finding any violations with respect to such
laws.
(f) With the exception of William W. Becker, who is a citizen of
Canada, and Jan E. Helen, who is a citizen of Norway, all of the individual
persons identified in Item 2(a) are citizens of the United States of America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
- ----------------------------------------------------------
On May 21, 1997, the Reporting Persons entered into an Exchange Agreement
with the Issuer (the "Exchange Agreement"), pursuant to which the Reporting
Persons changed the form of their beneficial ownership of securities of the
Issuer. In particular, the Reporting Persons exchanged all of their direct and
indirect interests in the Issuer for Common Stock and Nonvoting Series C
Preferred Stock of the Issuer. The direct and indirect interests included (a)
Series B Preferred Stock of the Issuer convertible into Common Stock, (b) Class
A Limited Partnership Interests convertible into Common Stock, (c) debt of the
Partnership convertible into Class B Partnership Interests, which in turn were
convertible into Common Stock, (d) equity interests in Display Group and (e)
debt of Display Group, which was convertible into Class B Partnership Interests,
which in turn were convertible into Common Stock. In connection with the
exchange, certain of the Reporting Persons who had previously guaranteed bank
loans to Display Group borrowed funds from the bank and lent the funds to
Display Group, which used the funds to repay the bank loan to Display Group. As
a result of the transaction, Display Group and Display Optics became wholly
owned by the Issuer. The Issuer assumed the obligation of Display Group to pay
outstanding legal fees in an amount to be agreed upon. No cash consideration was
paid.
ITEM 4. PURPOSE OF TRANSACTION.
- -------------------------------
The exchange referred to in Item 3 above was entered into in order to
simplify the structure of the Issuer's business, while retaining to the extent
practicable the economic characteristics of the interests that the Reporting
Persons held in the Issuer, Display Optics and Display Group. Pursuant to the
Exchange Agreement, which is attached hereto as
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 22 of 29
Exhibit 7.1, the Reporting Persons changed the form of their beneficial
ownership of the Issuer by exchanging the interests described in Item 3 above
for Common Stock and Series C Preferred Stock of the Issuer. The Issuer also
assumed certain liability for legal fees incurred by Display Group. In
addition, because the Issuer acquired all of the outstanding equity interests in
Display Group and Display Optics (which the Issuer intends to dissolve), the
Issuer indirectly acquired (i) the right to vote 1,365,030 shares of Common
Stock that are the subject of a replevin action brought by Display Group against
American Consolidated Growth Corporation and AGT Sports, Inc. (Display Group,
LLC v. American Consolidated Growth Corporation and AGT Sports, Inc. (Civil
Action No. 96-CV-1560), and (ii) ownership of 350,000 shares of Common Stock
that Display Group had acquired from former Board member Michael A. Nixon in
connection with the settlement of litigation between the Issuer, Display Group
and Display Optics, as plaintiffs, and Mr. Nixon and others, as defendants. The
Reporting Persons were granted "piggyback" registration rights for their Common
Stock pursuant to the Exchange Agreement and a Registration Rights Agreement, a
copy of which is attached hereto as Exhibit 7.2 (the "Registration Rights
Agreement").
Before the exchange, Michael A. Nixon resigned as a member of the Board of
Directors of the Issuer and Darrell Avey, the sole remaining director, elected
John Kilgore and Vince Bradshaw to fill vacancies existing on the Board. The
Issuer agreed in the Exchange Agreement to use its best efforts to make all
required filings pursuant to Rule 14f-1 under the 1934 Act in connection with
the election of additional directors of the Company. Subject to compliance with
Rule 14f-1 under the Act, the additional directors are expected to include Gene
W. Schneider, Mark Schneider, Bruce Etkin and Keith Hancock, although there is
no assurance that all of these persons will join the Board of Directors or that
other of the Reporting Persons will not join the Board of Directors. The
Exchange Agreement requires that the Issuer not take any of the following
actions without the prior written consent of holders of a majority of the
Issuer's Series C Preferred Stock until the earlier of (i) 90 days after the
date of the Exchange Agreement or (ii) the date on which four of seven members
of the board of directors have been designated by holders of the Issuer's Series
C Preferred Stock:
(a) Amend the Articles of Incorporation or Bylaws of the Issuer;
(b) Consummate any mergers, acquisitions, sales or leases of assets and
other significant transactions involving the Issuer;
(c) Sell or otherwise issue any equity or debt securities of the Issuer;
(d) Approve any annual operating and capital budgets of the Issuer or any
significant changes thereto;
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 23 of 29
(e) Change the Issuer's business activities beyond the scope of individual
display screen products;
(f) Enter into any agreements with directors, officers and other affiliates
of the Issuer;
(g) Consummate any stock splits or other reclassifications by the Issuer;
(h) Compromise or release any claims of, or debts owed to, the Issuer;
(i) Consummate any other actions out of the ordinary course of business of
the Issuer; or
(j) Review and approve any publicity or other communications pertaining to
the technology being developed by the Issuer or the shareholders.
The Exchange Agreement also requires that the Issuer allow up to two
representatives of the holders of the Issuer's Series C Preferred Stock to
attend all meetings of the Issuer's Board of Directors.
The foregoing summary of the Exchange Agreement and the Registration Rights
Agreement is not meant to be complete and is qualified in its entirety by
reference to the full text of such agreements, which are attached hereto as
exhibits and are incorporated herein by this reference.
Except as set forth in this Item 4, the Reporting Persons have no present
plan or proposal that relates to or that would result in any of the actions
specified in clauses (a) through (j) of Item 4 of Schedule 13D of the Act.
However, each of the Reporting Persons will continuously review its investment
in Issuer and may propose such transactions in the future.
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 24 of 29
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
- ---------------------------------------------
(a)
<TABLE>
<CAPTION>
Number of Shares
of Common Stock
Reporting Person Beneficially owned Percentage of Class
- --------------------------- ------------------ --------------------
<S> <C> <C>
Display Optics, Ltd. 0 0.0%
Display Group LLC 1,715,030 8.04%
Keith A. Hancock 76,045 0.36%
G. Schneider Holdings Co. 4,941,959 23.15%
Gene W. Schneider 4,941,959 23.15%
William W. Becker 1,873,369 8.78%
Mark L. Schneider 2,509,173 11.76%
Jan E. Helen 1,126,797 5.28%
William J. Elsner 1,126,812 5.28%
J. Timothy Brittan 842,492 3.95%
Bruce H. Etkin 3,247,456 15.21%
Peregrine Investments 760,450 3.56%
Daryl H. Owen 760,450 3.56%
Lindsay D. Hooper 760,450 3.56%
James C. Gould 760,450 3.56%
John D. Seiver 118,630 0.56%
John P. Cole, Jr. 886,685 4.15%
</TABLE>
(b) Except with respect to the Common Stock beneficially owned by Daryl H.
Owen, Lindsay D. Hooper, and James C. Gould, and the Replevin Shares
beneficially owned by Display Group, each of the Reporting Persons listed in
Item 5(a) above has sole voting and dispositive power over the Common Stock
beneficially owned by him. Daryl H. Owen, Lindsay D. Hooper, and James C.
Gould, as general partners of Peregrine Investments, each hold the shared power
to vote and dispose of the Common Stock owned by Peregrine Investments. Display
Group currently holds the sole power to vote the Replevin Shares. The Litigation
(as described in the Schedule 13D previously filed) has been pursued by Display
Group for the benefit of
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 25 of 29
Display Optics. Any recovery from the Litigation, including the Replevin
Shares, if awarded, will be held on behalf of Display Optics. As a result of the
Exchange Agreement, Issuer now owns all of the outstanding equity interests in
Display Optics and Display Group, therefore, any recovery from the Litigation
will ultimately be for the benefit of Issuer.
(c) On May 21, 1997, Issuer and the Reporting Persons completed the
transactions contemplated by the Exchange Agreement as described in Item 4
above.
(d) Not applicable.
(e) Without compromising any previous disclaimer of beneficial ownership or
status as a group, upon completion on May 21, 1997, of the transactions
contemplated by the Exchange Agreement, each of the following Reporting Persons
did not beneficially own greater than 5% of Issuer's Common Stock:
(1) Display Optics Ltd.
(2) Keith A. Hancock
(3) J. Timothy Brittan
(4) Peregrine Investments, a Virginia general
partnership ("Peregrine Investments"), whose
general partners are Daryl H. Owen, Lindsay D.
Hooper, and James C. Gould.
(5) Daryl H. Owen
(6) Lindsay D. Hooper
(7) James C. Gould
(8) John D. Seiver
(9) John P. Cole, Jr.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
- ------------------------------------------------------------------------------
TO SECURITIES OF THE ISSUER.
- ---------------------------
The exchange described in Item 4 above was consummated pursuant to the
Exchange Agreement attached as Exhibit 7.1 hereto, and the Registration Rights
Agreement attached hereto as Exhibit 7.2, both entered into by and among Issuer
and the Reporting Persons. The Reporting Persons previously made single joint
filings pursuant to Rule 13d-1(f) as a precautionary matter in the event that
they were deemed to comprise one
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 26 of 29
or more "groups" within the meaning of section 13(d)(3) of the
Securities Exchange Act of 1934 (the "Act"). However, each of the Reporting
Persons disclaimed the existence of any such group and each Reporting Person
disclaimed beneficial ownership of the securities owned by the other Reporting
Persons except as specifically stated otherwise in the Schedule 13D. Based on
the transactions described above in Item 4, the Reporting Persons have
determined that they will no longer report jointly under Section 13(d).
Accordingly, this Amendment No. 3 is the last joint filing by the Reporting
Persons. Subsequent filings will be made individually by the Reporting Persons
to the extent that the individual Reporting Persons are required to file under
Section 13(d).
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
- -----------------------------------------
7.1 Exchange Agreement dated as of May 21, 1997, among the Reporting
Persons and the Issuer.
7.2 Registration Rights Agreement dated as of May 21, 1997, among the
Reporting Persons and the Issuer.
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 27 of 29
SIGNATURES
- ----------
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Amendment No. 3 is true,
complete, and correct.
Dated: June 12, 1997.
DISPLAY OPTICS, LTD., a Colorado limited partnership
By: ADVANCE DISPLAY TECHNOLOGIES,
INC., a Colorado corporation, its general
partner
By: /s/ Darrell D. Avey
--------------------------------------
Darrell D. Avey, its chairman and vice
president
By: DISPLAY GROUP LLC, a Colorado limited
liability company, its managing general
partner
By: /s/ Keith Hancock
--------------------------------------
Keith Hancock, its manager
DISPLAY GROUP LLC, a Colorado limited
liability company
By: /s/ Keith Hancock
-------------------------------------------
Keith Hancock, its manager
/s/ Keith A. Hancock
----------------------------------------------
Keith A. Hancock
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 28 of 29
G. SCHNEIDER HOLDINGS CO., a Colorado
limited partnership
By: ***
-------------------------------------------
Gene W. Schneider, its general partner
***
----------------------------------------------
Gene W. Schneider
***
----------------------------------------------
William W. Becker
***
----------------------------------------------
Mark L. Schneider
***
----------------------------------------------
Jan E. Helen
***
----------------------------------------------
William J. Elsner
***
----------------------------------------------
J. Timothy Brittan
***
----------------------------------------------
Bruce H. Etkin
PEREGRINE INVESTMENTS, a Virginia general
partnership
By: ***
-------------------------------------------
Daryl H. Owen, general partner
<PAGE>
CUSIP NO. 007422306 SCHEDULE 13D (AMENDMENT NO. 3) Page 29 of 29
***
----------------------------------------------
Daryl H. Owen
***
----------------------------------------------
Lindsay D. Hooper
***
----------------------------------------------
James C. Gould
***
----------------------------------------------
John D. Seiver
***
----------------------------------------------
John P. Cole, Jr.
***By: /s/ Keith A. Hancock
----------------------------------------
Keith A. Hancock, attorney-in-fact
<PAGE>
Exhibit 7.1
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT (this "Agreement") is entered into as of this
21st day of May, 1997 by and among Keith A. Hancock, individually ("Hancock"),
- ----
G. Schneider Holdings Co., a Colorado limited partnership ("G.S. Holdings"),
William W. Becker, individually ("Becker"), Mark L. Schneider, individually ("M.
Schneider"), Jan E. Helen, individually ("Helen"), William J. Elsner,
individually ("Elsner"), J. Timothy Brittan, individually ("Brittan"), Bruce H.
Etkin, individually ("Etkin"), Peregrine Investments, a Virginia general
partnership ("Peregrine"), John D. Seiver, individually ("Seiver") and John P.
Cole, Jr., individually ("Cole") (collectively, the "Exchanging Parties," and
each an "Exchanging Party"), Advance Display Technologies, Inc., a Colorado
corporation (the "Company"), Display Optics, Ltd., a Colorado limited
partnership (the "Partnership"), and Display Group, LLC, a Colorado limited
liability company (the "LLC").
RECITALS
A. The Exchanging Parties individually own the assets indicated on
Schedule A to this Agreement, including (i) Series B Preferred Stock of the
Company, (b) Class A limited partnership interests in the Partnership, (c) debt
of the Partnership, (d) equity interests in the LLC and (e) debt of the LLC. In
addition, as also indicated on Schedule A, the LLC holds debt of the
Partnership.
B. The Series B Preferred Stock of the Company is convertible into
common stock of the Company ("Common Stock"). All of the debt described above
is convertible into Class B limited partnership interests in the Partnership.
The Partnership Agreement of the Partnership provides that 99% of all
distributions by the Partnership will be made to the limited partners until the
limited partners have received distributions equal to 150% of their investment
in the Partnership. The Class A and Class B limited partnership interests are
convertible into Common Stock.
C. In order to simplify the structure of the Company's business,
while retaining to the extent practicable the economic characteristics of the
investments described above, the parties desire for the Exchanging Persons to
transfer to the Company the assets listed on Schedule A (the "Exchanged Assets")
in exchange for the assets and rights listed on Schedule B and otherwise
described in this Agreement.
D. The independent directors of the Company have unanimously
determined that the transactions contemplated by this Agreement are fair to, and
in the best interests of, the Company and the shareholders of the Company other
than the exchanging Persons.
<PAGE>
The parties agree as follows:
Section 1 Exchange.
- --------- --------
1.1 (a) The parties hereto acknowledge that the exchange
contemplated by Section 1.1(b) below does not include value for any accrued
interest on the Loans. Each Exchanging Party hereby expressly waives all rights
to any accrued but unpaid interest on the Loans.
(b) Each Exchanging Party hereby transfers all of its right,
title and interest in and to all assets indicated as owned by such Exchanging
Party on Schedule A in exchange for the number of shares of Common Stock and
Series C Preferred Stock of the Company indicated for such Exchanging Party on
Schedule B and the other consideration referred to elsewhere in this Agreement.
The Company accepts such assignment and hereby issues to each Exchanging Party
the stock of the Company as indicated on Schedule B (the "Company Stock"). The
exchange contemplated by this Section 1.1(b) shall be immediately effective as
soon as this Agreement has been signed by all the parties (the "Effective
Time").
1.2 After the Effective Time, each Exchanging Party shall promptly
surrender to the Company all notes, certificates or other instruments of any
kind evidencing ownership of any of the Exchanged Assets, all duly endorsed to
the Company and accompanied by proper instruments of transfer to the Company, at
its office designated as herein provided. Upon receipt of the foregoing from an
Exchanging Person, the Company shall promptly deliver or send the following to
such Exchanging Person:
(a) certificates in the name of such Exchanging Person evidencing
the Company Stock to which such Exchanging Party is entitled as indicated on
Schedule B.
(b) a Registration Rights Agreement in the form attached to this
Agreement as Exhibit A, duly executed by the Company.
1.3 For each Exchanging Person, the exchange contemplated by this
Agreement shall be deemed to have occurred as of the Effective Time, and the
person or persons entitled to receive the shares of Company Stock shall be
treated for all purposes as the record shareholder or shareholders of such
shares of Company Stock on the Effective Time.
1.4 If any Exchanging Party is unable to locate a promissory note or
stock certificate to be surrendered by such Exchanging Party under Section 1.2,
such Exchanging Party shall be entitled nevertheless to receive the items
referred to in clauses (a) and (b) of Section 1.2 upon submission to the Company
of a lost note or lost certificate affidavit in customary form. The affidavit
shall state, among other things, that the lost note or certificate has not been
endorsed or otherwise transferred to encumbered and that such Exchanging Party
will indemnify the Company and the other Exchanging Parties for any damages they
may incur in connection with any claim by any third party to have any interest
in the lost note or certificate.
-2-
<PAGE>
1.5 All obligations of the Exchanging Parties under this Agreement
shall be several and not joint. Under no circumstances will any Exchanging
Party have any liability for any failure by any other Exchanging Party to comply
with any provision of this Agreement.
Section 2 Assignment and Assumption.
- --------- -------------------------
2.1 In connection with and as part of the exchange described in
Section 1.2 above, the Company hereby assumes the obligation of the LLC to pay
$163,000 to Holme Roberts & Owen LLP ("HRO") for fees and disbursements relating
to legal services, pending review of the legal invoices therefor. The final
amount of legal fees shall be agreed upon by the LLC, the Company and HRO, and
in the event that the amount of such fees is not equal to $163,000, the Company
stock to be issued pursuant to Schedule B shall be adjusted accordingly.
Section 3 Company Representations and Warranties. As a material inducement to
- --------- --------------------------------------
the Exchanging Parties to enter into this Agreement, the Company makes the
following representations and warranties to the Exchanging Parties, subject to
the disclosures set forth on Exhibit B attached hereto (the "Disclosure
Schedule"):
3.1 Organization, Standing, and Qualification. The Company is a
-----------------------------------------
corporation, duly organized, validly existing and in good standing under the
laws of the State of Colorado, and has all necessary power and authority to own
its properties owned by it and carry on its business as currently conducted.
3.2 Authorization; Enforceability. All action on the part of the
-----------------------------
Company necessary for the authorization, execution, delivery, and performance
of all the obligations of the Company under this Agreement and the consummation
of the transactions contemplated hereby has been taken. This Agreement
constitutes the valid and binding obligations of the Company, enforceable
against the Company in accordance with its terms. The members of the Company's
Board of Directors are Darrel Avey, John Kilgore, and Vince Bradshaw, and there
------------ --------------
are no other Directors of the Company. Each such person was duly appointed and
remains in good standing as a Director of the Company. The Company has provided
the Exchanging Parties and their respective counsel with true and accurate
copies of the appropriate resolutions of the Company's Board of Directors
relating to the transactions contemplated by this Agreement, certified by the
Secretary of the Company as true, accurate, and effective as of the date hereof.
3.3 Capitalization. The authorized capital stock of the Company
--------------
consists of 100,000,000 shares of Common Stock, par value $.001 per share, and
100,000,000 shares of Preferred Stock par value $.001 per share, of which
1,000,000 shares have been designated as Series A Preferred Stock, 2,991,474
shares have been designated as Series B Preferred Stock and 1,843,900 shares
have been designated as Series C Preferred Stock. Of the authorized capital
stock of the Company, 3,834,505 shares of Common Stock, no shares of Series A
Preferred Stock, and 2,991,505 shares of Series B Preferred Stock are
outstanding. All outstanding shares of the Company's capital stock are duly
authorized, validly issued, fully paid and nonassessable. Upon completion of the
transactions contemplated by this Agreement, 21,343,923 shares of
-3-
<PAGE>
Common Stock, no shares of Series A Preferred Stock, no shares of Series B
Preferred Stock and 1,843,900 shares of Series C Preferred Stock will be issued
and outstanding. Except as set forth on the Disclosure Schedule, there are no
outstanding rights, subscriptions, options, warrants, conversion privileges,
preemptive rights, or other agreements or commitments obligating the Company to
issue or transfer any additional equity securities (with or without the passage
of time and/or the occurrence of any other events) except for the items being
transferred to the Company by the Exchanging Parties under Section 1 above, none
of which items will be outstanding upon completion of the transactions
contemplated by this Agreement.
3.4 Validity of Stock. The Articles of Amendment to the Articles of
-----------------
Incorporation (the "Articles of Amendment") of the Company, a complete and
accurate copy of which are attached hereto as Exhibit C, are duly authorized by
the Company's Amended and Restated Articles of Incorporation, have been duly
adopted by the Board of Directors of the Company and govern the terms of the
Series C Preferred Stock. The Articles of Amendment have been filed with the
Colorado Secretary of State and are in full force and effect. The shares of
Common Stock and Series C Preferred Stock to be issued pursuant to this
Agreement (collectively, the "Shares"), when issued, shall be duly authorized,
validly issued, fully paid, and non-assessable and will be free of any liens or
encumbrances.
3.5 Control of Shares. Upon completion of the transactions
------------------
contemplated by this Agreement, the Exchanging Parties, in the aggregate, will
own stock possessing at least 80% of the total combined voting power of all
classes of stock of the Company entitled to vote and at least 80% of the total
number of shares of all other classes of stock of the Company.
3.6 Securities and Exchange Commission Filings. (a) True and
------------------------------------------
complete copies of all reports, registration statements, definitive proxy
statements and other documents, including all amendments to any of the foregoing
(collectively the "Commission Filings") filed by the Company with the Securities
and Exchange Commission (the "Commission") have been furnished to Display Group
by the Company. The Commission Filings constitute all of the documents required
to be filed by the Company with the Commission during the last five years. As of
their respective dates, each of such Commission Filings complied in all material
respects with the applicable requirements of the Securities Act of 1933 and the
Securities Exchange Act of 1934, and none of such Commission Filings contained
as of such date any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(b) When filed with the Commission, the financial statements included
in the Commission Filings filed during the three-year period ending on the date
of this Agreement complied as to form in all material respects with the
applicable rules and regulations of the Commission and were prepared in
accordance with generally accepted accounting principles applied on a consistent
basis (except as may be indicated therein or in the notes or schedules thereto),
and such financial statements fairly present the financial position of the
Company as at the dates thereof and the results of its operations and its cash
flows for the periods then ended,
-4-
<PAGE>
subject, in the case of the unaudited interim financial statements, to normal,
recurring year-end audit adjustments. Except to the extent reflected or
reserved against in the financial statements included in the Company's Quarterly
Report on Form 10-Q for the quarter ended December 31, 1996 (the "10-Q"), the
Company does not have any liability or obligation of any kind, whether accrued,
absolute, contingent, unliquidated or other and whether due or to become due
(including any liability for breach of contract, breach of warranty, torts,
infringements, claims or lawsuits), other than liabilities for debt included in
the Exchanged Assets and immaterial liabilities incurred since December 31,
1996, in the ordinary course of business. Since December 31, 1996, the Company
has not entered into any agreement (other than this Agreement), or transaction
outside of the ordinary course of business, or declared or paid any dividend or
acquired or committed to acquire any of its capital stock (other than pursuant
to this Agreement) and there has not been any material adverse change in the
Company's financial position, results of operations or prospects.
3.7 Tax Returns and Audits. The Company has filed all federal,
----------------------
state, and local tax returns and reports within the times and in the manner
prescribed by law and has paid (or made adequate provision in the balance sheet
included in the 10-Q for) all taxes shown due on such returns, as well as all
other assessments and penalties which have become due and payable. The
Company's federal income tax returns have not been audited by the Internal
Revenue Service or any other taxing authority and no notice of audit has been
received. The provisions for taxes in the balance sheet included in the 10-Q
are adequate for any and all federal, state, county, local and other taxes for
the period ending on such date and for all prior periods, whether or not
disputed. The Company has not received notice of any disputes, deficiency
assessments, or proposed adjustments to taxes payable by the Company.
3.8 Articles of Incorporation and Bylaws: No Conflicts. The Company
---------------------------------------------------
is not in violation of any provision of its Articles of Incorporation or Bylaws,
as amended and in effect as of the date hereof. There is no default or event
that, with notice or lapse of time, or both, would conflict with or constitute a
breach of the Company's Amended and Restated Articles of Incorporation or
Bylaws. The execution, delivery and performance of this Agreement by the
Company will not violate, cause a default under, otherwise breach or result in
the actual or potential acceleration of any obligations or any loss or
forfeiture of any rights by the Company pursuant to any existing agreement or
arrangement to which the Company or, to the best of the Company's knowledge, the
Partnership, is a party or by which their respective assets may be affected.
3.9 Litigation. There are no actions, suits, or legal,
----------
administrative, or other proceedings or investigations pending or, to the best
of the Company's knowledge, threatened before any court, agency, or other
tribunal to which the Company or, to the best of the Company's knowledge, the
Partnership, is a party or against or affecting any of the property, assets,
businesses, or financial condition of the Company or, to the best of the
Company's knowledge, the Partnership. Neither the Company nor, to the best of
the Company's knowledge, the Partnership, is in default with respect to any
order, writ, injunctions, or decree of any federal, state, local or foreign
court, department, agency, or instrumentality to which it is a party.
-5-
<PAGE>
3.10 Agreement Will Not Cause Breach or Violation. The consummation
--------------------------------------------
of the transactions contemplated by this Agreement (including the issuance of
the Company Stock) will not result in any violation of or constitute a default
or an event that, with notice or lapse of time, or both, would conflict with or
constitute a breach or default of the Partnership Agreement or the Articles of
Incorporation or Bylaws of the Company or of any contract commitment or other
arrangement or any material provision of state or federal law and will not
result in the creation or imposition of any lien or encumbrance on any of the
property of the Company or, to the best of the Company's knowledge, the
Partnership, or on the Company Stock, the limitation of any rights of the
Company or, to the best of the Company's knowledge, the Partnership, or the
increase or acceleration of any obligations of the Company or the Partnership.
3.11 Governmental Approvals/Third Party Consents. All consents,
-------------------------------------------
approvals, or authorizations of, or registrations, qualifications, designations,
declarations, or filings with any federal or state governmental authority, and
all consents, approvals or authorizations of any third party, required in
connection with the execution of this Agreement and the transactions
contemplated hereby (including the issuance and sale of the Company Stock) have
been obtained by the Company.
3.12 Registration Rights. The Company is not under any obligation to
-------------------
register any of its presently outstanding securities pursuant to the Securities
Act of 1933 (the "Securities Act") except as set forth in the Registration
Rights Agreement in form substantially similar to Exhibit A, to be executed by
the Exchanging Parties and the Company simultaneously with this Agreement.
3.13 The Company and its Board of Directors have received a written
opinion from Neidiger, Tucker, Bruner, Inc., independent financial advisors,
that the transactions contemplated by this Agreement are fair, from a financial
point of view, to the shareholders of the Company other than the Exchanging
Parties.
3.14 Accuracy of Information Furnished. The representations and
---------------------------------
warranties in this Agreement do not contain any untrue statement of a material
fact or omit to state any material fact that is necessary to make the statements
contained herein or therein not misleading as of the Effective Time.
3.15 Compliance with Laws. The Company (a) has complied with and is
--------------------
in compliance in all material respects with all federal, state and local
statutes, laws, ordinances, regulations, rules, judgments, orders and decrees
applicable to it and its assets, business and operations and (b) has not
received notice of any claim of default under or violation of any statute, law,
ordinance, regulation, rule, judgment, order or decree.
Section 4 Remedies on and Notices of Default. In addition to any other
- --------- ----------------------------------
available legal or equitable remedies, if the representation and warranty in
Section 3.3 of this Agreement is ever determined to have been inaccurate in any
respect when made, then the Company shall promptly issue to each Exchanging
Person the number of shares of Common Stock and/or Series C
-6-
<PAGE>
Preferred Stock that will cause the total amount of Company Stock issued to each
Exchanging Party to represent the same percentage voting and economic interest
in the Company as such person would have received if there had been no
inaccuracy in Section 3.3.
Section 5 Representations and Warranties of the Exchanging Parties. (a) Each
- --------- --------------------------------------------------------
Exchanging Party represents severally, but not jointly, that this Agreement
is a valid and binding obligation of such Exchanging Party, enforceable against
such Exchanging Party in accordance with its terms, and that the Exchanging
Party has not taken any action that would cause any of the Exchanged Assets
owned by such Exchanging Party (as indicated on Schedule A to this Agreement) to
be subject to the claims of any third party.
(b) Each Exchanging Party acknowledges, represents and warrants as
follows:
(i) Each Exchanging Party that is a natural person is twenty-one (21)
years of age, of legal capacity to execute this Agreement, and in a financial
position to hold the Shares for an indefinite period of time and is able to bear
the economic risks and withstand a complete loss of his investment in the
Shares; and
(ii) Each Exchanging Party, either alone or with the assistance of his
own professional advisor, has such knowledge and experience in financial and
business matters that he is capable of evaluating the merits and risk of an
investment in the Shares and has the net worth to undertake such risks; and
(iii) Each Exchanging Party has received and had the opportunity to
review the Company's Annual Report on Form 10-KSB for the fiscal year ended June
30, 1996 and the Articles of Amendment to the Articles of Incorporation
describing the Series C Preferred Stock, and has been given access to full and
complete information regarding the Company and has utilized such access to his
satisfaction for the purpose of obtaining such information regarding the Company
as he has reasonably requested; and, particularly, each Exchanging Party has
been given reasonable opportunity to ask questions of, and receive answers from,
representatives of the Company concerning the terms and conditions of the
exchange and to obtain any additional information, to the extent reasonably
available; and
(iv) Each Exchanging Party recognizes that the Company has a limited
operating history and that the Shares as an investment involve a high degree of
risk, including but not limited to the risk of economic losses from operations
of the Company; and
(v) Each Exchanging Party realizes that (A) the purchase of the Shares
is a long-term investment; (B) the purchaser of the Shares must bear the
economic risk of investment for an indefinite period of time because the Shares
have not be registered under the Securities Act of 1933 or under the securities
laws of any state and, therefore, the Shares cannot be resold unless the Share
are subsequently registered under said laws or exemptions from such
registrations are available; and (C) the transferability of the Shares is
restricted and requires conformity with the restrictions contained in paragraph
(c) below.
-7-
<PAGE>
(c) Each Exchanging Party acknowledges that the Shares have not been
registered under the Securities Act of 1933 or applicable state securities laws
and that the Shares are being offered and sold pursuant to exemptions from such
laws and that the Company's reliance upon such exemptions is predicated in part
on each Exchanging Party's representations as contained herein. Each Exchanging
Party represents and warrants that the Shares are being purchased for his own
account and for investment purposes only, and without the intention of reselling
or redistributing the same, that each Exchanging Party has made no agreement
with others regarding any of the Shares, and that each Exchanging Party's
financial condition is such that it is not likely that it will be necessary to
dispose of any of such securities in the foreseeable future. Each Exchanging
Party further represents and agrees that if, contrary to the foregoing
intentions, he should later desire to dispose of or transfer any of such
securities in any manner, he shall not do so without first obtaining (i) the
opinion of counsel to the Company that such proposed disposition or transfer may
be lawfully made without the registration of such securities pursuant to the
Securities Act of 1933, as then amended, and applicable state securities laws,
or (ii) such registration (it being understood that the Company has no
obligation to register any securities). The Company will restrict transfer in
accordance with the foregoing representation.
(d) Each Exchanging Party hereby represents and warrants that he is an
"accredited investor" and within the meaning of Rule 501 of Regulation D of the
1933 Act.
(e) Each Exchanging Party has obtained independent tax counsel or
advice regarding the tax treatment and effect of the Exchange to such Exchanging
Party. None of the Exchanging Parties has relied on any advice from the Company
regarding the tax treatment of the Exchange, and understands that the Company
has made no representations or warranties to that effect.
(f) The financial statements of the LLC as of December 31, 1996 (the
"LLC Financials") and previously delivered to the Company are a true and
accurate statement of the financial condition of the respective entities as of
the dates therein stated, prepared in accordance with Federal Income Tax
principles. Except to the extent reflected or reserved against in the LLC
Financials, the LLC does not have any liability or obligation of any kind,
whether accrued, absolute, contingent, unliquidated or other and whether due or
to become due (including any liability for breach of contract, breach of
warranty, torts, infringements, claims or lawsuits), other than immaterial
liabilities incurred since December 31, 1996, in the ordinary course of
business.
Section 6 Covenants of the Company.
- ----------- ------------------------
6.1 Affirmative Covenants. The Company shall use its best efforts to
---------------------
make all required filings under Rule 14f-1 of the Securities Exchange Act of
1934 in connection with the election of additional directors of the Company.
6.2 Negative Covenants. For a period commencing as of the Effective
------------------
Time through the earlier to occur of (i) 90 days thereafter, or (ii) the date on
which the holders of the Series C Preferred Stock have elected 4 of the 7
members of the Board of Directors of the Company after filing of all applicable
securities filing described in Section 6.1 above, the Company agrees that it
-8-
<PAGE>
will not take any of the following actions by the Company without the prior
written consent of a majority of the holders of Series C Preferred Stock of the
Company:
(a) Amend the Articles of Incorporation or Bylaws of the Company;
(b) Consummate any mergers, acquisitions, sales or leases of assets
and other significant transactions involving the Company;
(c) Sell or otherwise issue any equity or debt securities of the
Company;
(d) Approve any annual operating and capital budgets of the Company or
any significant changes thereto;
(e) Change the Company's business activities beyond the scope of
individual display screen products;
(f) Enter into any agreements with directors, officers and other
affiliates of the Company;
(g) Consummate any stock splits or other reclassifications by the
Company;
(h) Compromise or release any claims of, or debts owed to, the
Company;
(i) Consummate any other actions out of the ordinary course of
business of the Company; or
(j) Review and approve any publicity or other communications
pertaining to the technology being developed by the Company or the shareholders.
The holders of the Series C Preferred shall reply promptly to any request by the
Company to take any of the foregoing actions.
In addition, up to 2 representatives of the holders of Series C Preferred Stock
shall be permitted to attend all meetings of the Board of Directors of the
Company. Also, upon request of the holders of Series C Preferred Stock and at
the expense of the Company, the Company will engage auditors and attorneys to
conduct a due diligence review of the Company, and the Company agrees to
cooperate in such review.
Section 7 Miscellaneous Provisions.
----------- ------------------------
7.1 Modifications and Waivers. This Agreement may not be amended or
-------------------------
modified, nor may the rights of any party be waived, except by a written
document that is executed by (a) the Company and (b) Exchanging Persons with at
least 50% of the "amount at risk" as indicated in Schedule A. No amendment to
this Agreement reducing the consideration to be
-9-
<PAGE>
received by any Exchanging Person shall be effective unless signed by each
Exchanging Person whose consideration is to be reduced.
7.2 Assignment. This Agreement is binding upon and shall inure to
----------
the benefit of the parties and their respective successors and permitted
assigns. No party hereto may assign this Agreement to any third party without
the prior written consent of (a) the Company and (b) Exchanging Persons with at
least 50% of the "amount at risk" as indicated in Schedule A.
7.3 Rights and Obligations of Third Parties. Nothing in this
---------------------------------------
Agreement, whether express or implied, is intended to confer any rights or
remedies under or by reason of this Agreement on any persons other than the
parties to it and their respective successors and permitted assigns, nor is
anything in this Agreement intended to relieve or discharge the obligation or
liability of any third parties to any party to this Agreement, nor shall any
provision give any third party any right of subrogation or action against any
party to this Agreement.
7.4 Notices. Any notice, request, consent, or other communication
-------
hereunder shall be in writing, and shall be sent by one of the following means:
(i) by registered or certified first class mail, postage prepaid, return receipt
requested; (ii) by facsimile transmission with confirmation of receipt; (iii) by
overnight courier service; or (iv) by personal delivery, and shall be properly
addressed as follows:
If to the Company to:
Advance Display Technologies, Inc.
1251 South Huron Street
Denver, Colorado 80223
Attention: Darrell Avey
Facsimile: (303) 733-5363
With a copy to:
David Babiarz, Esq.
Overton Babiarz & Sykes
7720 E. Belleview Ave., Suite 200
Englewood, Colorado 80111
Facsimile: (303) 779-6006
If to Partnership, to:
Display Optics, Ltd.
5251 DTC Parkway, Suite 1210
Englewood, Colorado 80111
Attention: Darrell Avey
Facsimile: (303) 694-0770
-10-
<PAGE>
If to LLC, to:
Display Group, LLC
5251 DTC Parkway, Suite 1210
Englewood, Colorado 80111
Attention: Keith Hancock
Facsimile: (303) 694-0770
If to an Exchanging Party, to such Exchanging Party at the address set
forth on Schedule C attached to this Agreement, or to such other address or
addresses as the Company, the Partnership or the LLC or any Exchanging Party
shall hereafter designate to the other parties in writing. Notices sent by mail
shall be effective 7 days after they are sent, and notices delivered personally
by facsimile or by courier shall be effective at the time of delivery thereof.
7.5 Further Actions. All parties hereto agree to execute and deliver
---------------
to the other parties, from time to time hereafter, for no additional
consideration and at no additional cost to the requesting party, such further
assignments, certificates, instruments, records, or other documents, assurances
or things as may be reasonably necessary to give full effect to this Agreement
and to allow each party fully to enjoy and exercise the rights accorded and
acquired by it under this Agreement.
7.6 Entire Agreement. This Agreement, including the schedules and
----------------
exhibits to this Agreement, constitutes the entire agreement between the parties
hereto in relation to the subject matter hereof. Any prior written or oral
negotiations, correspondence, or understandings relating to the subject matter
hereof shall be superseded by this Agreement and shall have no force or effect.
The representations, warranties, covenants and agreements made herein shall
survive any investigation made by the Exchanging Parties.
7.7 Severability. If any provision that is not essential to the
------------
effectuation of the basic purpose of this Agreement is determined by a court of
competent jurisdiction to be invalid and contrary to any existing or future law,
such invalidity shall not impair the operation of the remaining provisions of
this Agreement.
7.8 Headings. The headings of the Sections of this Agreement are
--------
inserted for convenience of reference only and shall not affect the construction
or interpretation of any provisions hereof.
7.9 Schedules and Exhibits. The schedules and exhibits to this
----------------------
Agreement are a part of this Agreement for all purposes. Terms which are
defined in this Agreement shall have the same meanings when used in such
schedules and exhibits.
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<PAGE>
7.10 Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which when executed and delivered shall be an original,
but all of which together shall constitute one and the same instrument.
7.11 Expenses. Each party shall bear and pay its own expenses
--------
incurred in connection with negotiating and preparing this Agreement and the
exhibits hereto.
7.12 Governing Law. This Agreement shall be construed in accordance
-------------
with and governed by the laws of the State of Colorado.
7.13 Delays or Omissions. No delay or omission to exercise any
-------------------
right, power, or remedy accruing to either party, upon any breach or default of
the other party under this Agreement, shall impair any such right, power, or
remedy, nor shall it be construed to be a waiver of any such breach or default,
or an acquiescence therein, or of or in any similar breach of default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent, or approval on the part of either party of any breach
or default by the other party under this Agreement, or any waiver of any
provisions or conditions of this Agreement must be made in writing signed by the
parties and shall be effective only to the extent specifically set forth in such
writing. All remedies, either under this Agreement or by law or otherwise
afforded to either party, shall be cumulative and not alternative.
7.14 Attorneys Fees. If any party elects to pursue legal action to
--------------
enforce its rights under this Agreement, and if a court of competent
jurisdiction adjudicates the matter, then the prevailing party in such action
shall be entitled to receive from the losing party all reasonable costs and
expenses, including the reasonable fees of attorneys, accountants, and other
experts, incurred by the prevailing party in investigating and prosecuting (or
defending) such action at the arbitration, trial and appellate levels.
COMPANY:
ADVANCE DISPLAY
TECHNOLOGIES, INC.,
a Colorado corporation
By: /s/ Darrell Avey
-----------------------------
Name: Darrell Avey
Title: Chairman
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<PAGE>
PARTNERSHIP:
DISPLAY OPTICS, LTD.,
a Colorado limited partnership
By: Advance Display Technologies, Inc., a
Colorado corporation, General Partner
By: /s/ Darrell Avey
------------------------------
Name: Darrell Avey
Title: Chairman
LLC:
DISPLAY GROUP, LLC,
a Colorado limited liability company
By: /s/ Keith A. Hancock
---------------------------------
Name: Keith A. Hancock
Title: Manager
EXCHANGING PARTIES:
/s/ Keith A. Hancock
---------------------------------
Keith A. Hancock
G. SCHNEIDER HOLDINGS CO.,
a Colorado limited partnership
By: /s/ Gene W. Schneider
----------------------------------
Gene W. Schneider
General Partner
/s/ William W. Becker
----------------------------------
William W. Becker
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<PAGE>
/s/ Mark L. Schneider
----------------------------------
Mark L. Schneider
/s/ Jan E. Helen
-----------------------------
Jan E. Helen
/s/ William J. Elsner
----------------------------------
William J. Elsner
/s/ J. Timothy Brittan
-----------------------------------
J. Timothy Brittan
/s/ Bruce H. Etkin
-------------------------------
Bruce H. Etkin
PEREGRINE INVESTMENTS,
a Virginia general partnership
By: /s/ Daryl Owen
---------------------------
Name: Daryl Owen
Title: General Partner
/s/ John D. Seiver
-------------------------------
John D. Seiver
/s/ John P. Cole, Jr.
----------------------------------
John P. Cole, Jr.
-14-
<PAGE>
Exhibit 7.2
FORM OF
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is entered into as of May
, 1997, among Advance Display Technologies, Inc., a Colorado corporation (the
- --
"Company"), and the several shareholders of the Company named on the signature
pages to this Agreement (the "Holders").
RECITALS
A. Each Holder owns shares of Common Stock of the Company as of the date of
such Holder's execution of this Agreement and none of the Holders have any
registration rights under the Securities Act of 1933 (the "Securities Act")
with respect to such shares.
B. As an inducement to each Holder to enter into an Exchange Agreement of even
date herewith among the Holders, the Company and certain other parties (the
"Exchange Agreement"), and as consideration for the other agreements made by
the Holders in this Agreement, the Company is entering into this Agreement
with the Holders. This Agreement sets forth the terms on which each Holder
shall have the right to join in any registration of "Registrable Securities"
by the Company under the Act. As used in this Agreement, "Registrable
Securities" means Common Stock of the Company issued to the Holders and any
securities issued or issuable with respect to such Common Stock by way of
any stock split or in connection with a combination of shares, merger,
recapitalization, merger consolidation or other reorganization.
AGREEMENT
The parties agree as follows:
1. Piggyback Registration Rights. For a period of 5 years after the date
------------------------------
hereof, subject to the other terms and conditions of this Agreement, if at
any time the Company proposes to register for offer and sale under the
Securities Act of 1933 (the "Securities Act") any of its Common Stock or
other securities, whether or not for sale for its own account, the Company
shall provide each Holder with a written notice of the proposed registration
(unless the proposed registration is on Form S-4, S-8, or another form that
may not be used for sales of Common Stock by the Holders). Such notice shall
not be required to include the price at which the securities will be offered
for sale. Upon the written request of each Holder given within 20 days after
any such notice is given by the Company, the Company shall include in such
registration statement all of the Registrable Securities held by such Holder
that such Holder so requests to be registered and included in such offering
(subject to Section 6 of this Agreement in connection with underwritten
offerings).
<PAGE>
2. Withdrawal. A Holder shall have the right to withdraw its shares from the
----------
registration process, but if the same relates to an underwritten offering it
may only do so during the time period and on terms agreed upon by the
managing underwriter for such underwritten offering. Under no circumstances
will this Agreement limit the right of the Company to withdraw any
registration statement at any time.
3. Obligations of the Company. Whenever required under Section 1 to effect the
--------------------------
registration of any Registrable Securities, the Company shall, as
expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and employ in good faith
reasonable efforts to cause such registration statement to become
effective, and keep such registration statement effective for a period
of up to 90 days or until the distribution contemplated in the
registration statement has been completed, whichever first occurs;
provided, however, that before filing a registration statement or
-------- -------
prospectus or any amendments or supplements thereto, including
documents incorporated by reference after the initial filing of the
registration statement and prior to effectiveness thereof, the Company
shall furnish to one counsel designated by the selling Holders (by
majority vote based on the number of Registrable Securities to be
registered) copies of all such documents in the form substantially as
proposed to be filed with the SEC at least four business days prior to
filing for review by such counsel.
(b) Prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection with
such registration statement necessary to comply, in all material
respects, with the provisions of the Act with respect to the
disposition of all securities covered by such registration statement.
(c) Furnish to the Holders such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as they may
reasonably request in order to facilitate the disposition of
Registrable Securities owned by them.
(d) Employ in good faith reasonable efforts to register and qualify
the securities covered by such registration statement under such
securities or Blue Sky laws of such jurisdictions as shall be
reasonably requested by the Holders or managing underwriter or agent,
if applicable; provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do
business or to file a general consent to service of process in any
such states or jurisdictions, unless the Company is already subject to
service in such jurisdiction and except as may be required by the Act.
-2-
<PAGE>
(e) In the event of any underwritten or agented public offering, enter
into and perform its obligations (including indemnification and
contribution obligations) under an underwriting or agency agreement,
in usual and customary form, with the managing underwriter or agent of
such offering.
(f) Notify each Holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto
is required to be delivered under the Act, upon the Company's
discovery that, or upon the happening of any event as a result of
which, the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to
make the statements therein in the light of the circumstances under
which they were made not misleading, and at the request of any such
Holder promptly prepare and furnish to such Holder and each
underwriter, if any, a reasonable number of copies of a supplement to
or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such securities, such
prospectus shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein in the light of the
circumstances under which they were made not misleading; provided,
however, that, except in the case of an underwritten offering as to
which Registrable Securities have been sold thereunder, the Company
may delay effecting or causing to be effected a supplement or post-
effective amendment to the registration statement or the related
prospectus for a period not to exceed 90 days in any 365 day period.
(g) Cause all such Registrable Securities covered by such registration
statement to be listed on each securities exchange, if any, or
National Association of Securities Dealers Automatic Quotation System
(Nasdaq), on which similar securities issued by the Company are then
listed.
(h) Provide a transfer agent and registrar for all Registrable
Securities registered hereunder and a CUSIP number for all such
Registrable Securities, in each case not later than the effective date
of such registration.
(i) Promptly notify each selling Holder of any stop order issued or
threatened in writing to be issued by the SEC in connection therewith
and take all reasonable actions required to prevent the entry of such
stop order or to remove it if entered.
(j) Make available to the Company's security holders upon request
copies of all periodic reports, proxy statements, and other
information referred to in Section 11, including an earnings statement
satisfying the provisions of Section 11(a), of the Act no later than
90 days following the end of the 12-month period beginning with the
first month of the Company's first fiscal quarter commencing after the
effective date of each registration statement filed pursuant to this
Agreement.
-3-
<PAGE>
(k) Use the Company's reasonable efforts to obtain a "comfort letter"
from its independent public accountants, and legal opinions of counsel
to the Company addressed to the selling Holders, in customary form and
covering such matters of the type customarily covered by such letters,
and in a form that shall be reasonably satisfactory to the selling
Holders. The Company shall furnish to counsel for the selling Holders
a signed counterpart of any such comfort letter or legal opinion.
Delivery of any such opinion or comfort letter shall be subject to
each Selling Holder furnishing such written representations or
acknowledgments as are customarily provided by selling stockholders
who receive such comfort letters or opinions, and an opinion of
counsel for the selling stockholders addressed to the Company and the
underwriters in customary form and covering such matters of the type
customarily covered by such opinion letters.
(l) Take all other reasonable actions necessary to expedite and
facilitate disposition by the Holders of the Registrable Securities
pursuant to the registration statement.
Each Holder of Registrable Securities agrees that, upon receipt of any notice
from the Company of the occurrence of any event of the kind described in
Subsection 3(f), such Holder shall forthwith discontinue such Holder's
disposition of Registrable Securities pursuant to the registration statement
relating to such Registrable Securities until such Holder's receipt of the
copies of the supplemented or amended prospectus contemplated by Subsection 3(f)
and, if so directed by the Company, shall deliver to the Company (at the
Company's expense) all copies, other than permanent file copies, then in such
Holder's possession of the prospectus relating to such Registrable Securities
current at the time of receipt of such notice. In the event the Company shall
give any such notice, the period of time for which the Company shall be required
to keep the applicable registration statement effective under Subsection 3(a)
shall be extended by the length of the period from and including the date when
each Holder of any Registrable Securities covered by such registration statement
shall have been given such notice to the date on which each such Holder has
received the copies of the supplemented or amended prospectus contemplated by
Subsection 3(f). The Company agrees to use its best efforts to minimize the
duration and frequency of any periods during which Holders are required to
discontinue their disposition of Registrable Securities under Section 3(f) to
those where distributing a supplement or filing a post-effective amendment would
materially interfere with, or require premature disclosure of, any financing,
acquisition or reorganization involving the Company or any of its wholly-owned
subsidiaries or would otherwise have a material adverse effect on the Company.
4. Furnish Information. It shall be a condition precedent to the obligations
-------------------
of the Company to take any action pursuant to Section 1 with respect to the
Registrable Securities of any selling Holder that such Holder shall furnish
to the Company such information regarding itself, the Registrable Securities
held by it, and the intended method of disposition of such securities as
shall be required to effect the registration of such Holder's Registrable
Securities.
-4-
<PAGE>
5. Expenses. Except as otherwise required by applicable securities laws or
--------
policies, all expenses incurred by the Company in connection with a
registration pursuant to this Agreement, including, but not limited to, all
registration and filing fees, fees and expenses of compliance with
securities or blue sky laws, and fees and disbursements of the Company's
counsel, of one counsel for the selling Holders and of independent certified
public accountants of the Company (including the expenses of any special
audit required by or incident to such performance), shall be borne by the
Company. This provision shall not apply to payment of any selling
commissions or other selling expenses of the selling Holders, other than the
fees and disbursements of one counsel for the selling Holders.
6. Underwriting Requirements.
-------------------------
(a) In connection with any underwritten offering of the Company's
capital stock or, if the managing underwriter or agent expressly
consents to the inclusion of Registerable Securities in such
underwriting, other securities under the Act, the Company shall not be
required under Section 1 to include any of a Holder's Registrable
Securities in such underwriting unless such Holder accepts the terms
of the underwriting as agreed upon between the Company and the
underwriters selected by it. If the managing underwriter advises the
selling Holders that marketing factors require any limitation as to
the Registrable Securities included in such offering, subject to
Section 6(b), the Registrable Securities to be included in such
registration shall be allocated among all selling Holders of
Registrable Securities which would otherwise be underwritten pursuant
hereto in proportion (as nearly as practicable) to the amount of
Registrable Securities owned by each selling Holder or as shall
mutually be agreed to by the Company and the selling Holders.
(b) If the managing underwriter advises the selling Holders that
marketing factors require any limitation as to Registerable Securities
to be underwritten and shares other than the selling Holders are
proposed to be included in the registration, then (A) first,
securities being registered by the Company will be included in such
registration before those of the selling Holders or any other
stockholders exercising piggyback registration rights, (B) second,
securities being registered by selling Holders will be included in
such registration pursuant to Section 6(a) above before those of any
other stockholders exercising piggyback registration rights, and (C)
finally, securities being registered by any other stockholders
exercising piggyback registration rights shall be included in such
registration on a basis comparable to that stated in the last sentence
of Section 6(a).
7. Delay of Registration. No Holder shall have any right to obtain or seek an
---------------------
injunction restraining or otherwise delaying any such registration as the
result of any controversy that might arise with respect to the
interpretation or implementation of this Agreement.
-5-
<PAGE>
8. Indemnification.
---------------
(a) In connection with any registration statement in which a Holder
participates pursuant to this Agreement, the Company agrees to
indemnify, to the extent permitted by law, each such Holder, the
officers and directors of each Holder, and each person who controls
such Holder (within the meaning of the Securities Act or the
Securities Exchange Act of 1934 (the "Exchange Act")) against all
losses, claims, damages, liabilities, and expenses caused by any
untrue or alleged untrue statement of material fact contained in any
registration statement, prospectus, preliminary prospectus, or other
related filing with the Securities and Exchange Commission or any
other federal or state governmental agency, or any omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading,
except insofar as the same are caused by or contained in any
information furnished to the Company by such Holder expressly for use
therein or by such Holder's failure to comply with any legal
requirement applicable to him and not contractually assumed by the
Company to deliver a copy of the registration statement or prospectus
or any amendments or supplements thereto after the Company has
furnished such Holder with a sufficient number of copies of the same.
(b) In connection with any registration statement in which a Holder
participates pursuant to this Agreement, each such Holder will furnish
to the Company or the underwriter in writing such information and
affidavits as the Company reasonably requests for use in connection
with any such registration statement or prospectus and, to the extent
permitted by law, will indemnify the Company, its directors and
officers, and each person who controls the Company (within the meaning
of the Securities Act or the Exchange Act) against all losses, claims,
damages, liabilities, and expenses resulting from any untrue or
alleged untrue statement of material fact or any omission or alleged
omission of a material fact required to be stated in the registration
statement or prospectus or other related filing with the Securities
and Exchange Commission or any other federal or state governmental
agency, or any amendment thereof or supplement thereto or necessary to
make the statements therein not misleading, but only to the extent
that such untrue statement or omission is caused by or contained in
any information furnished to the Company by such Holder expressly for
use therein; provided that the obligation to indemnify will be
several, not joint, among such Holders.
(c) Any person entitled to indemnification hereunder will (i) give
prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification and (ii) unless in such
indemnified party's reasonable judgment (based on written advice of
counsel) a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit the
indemnifying party to assume the defense of the claim with counsel
reasonably satisfactory to the indemnified party. If the defense is so
assumed, the
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<PAGE>
indemnifying party will not be subject to any liability for any
settlement made by the indemnified party without its consent, which
will not be unreasonably withheld. An indemnifying party who is not
entitled to or elects not to assume the defense of a claim, will not
be obligated to pay the fees and expenses of more than one counsel for
all parties it indemnifies with respect to such claim, unless in the
reasonable judgment of any indemnified party (based on written advice
of counsel) a conflict of interest may exist between such indemnified
party and any other indemnified parties with respect to such claim.
9. Participation in Underwritten Registrations. No Holder may participate in
-------------------------------------------
any registration hereunder for an underwritten offering unless such Holder
(a) agrees to sell its securities on the basis provided in any underwriting
arrangements approved by the Company and (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
10. Lock-up In Public Offering. If the Company files a registration statement
--------------------------
under the Securities Act in connection with any proposed public offering of
securities issued by the Company, each Holder, if so requested by the
Company and by the managing underwriter of such offering, agrees to sign a
lock-up agreement or letter in customary form to the effect that such
Holder will not, directly or indirectly, sell, make any short sale of,
grant any option for the purchase of, or otherwise dispose of any capital
stock of the Company (except securities included in such registration
statement and public offering) during the 30-day period ending, and up to a
180-day period beginning, on the first date of the effectiveness of such
registration statement.
11. Covenants of the Company. The Company hereby agrees and covenants as
------------------------
follows: The Company shall not, directly or indirectly, (x) enter into any
merger, consolidation or reorganization in which the Company shall not be
the surviving corporation, unless prior to such merger, consolidation, or
reorganization, the surviving corporation shall have agreed in writing to
assume the obligations of the Company under this Agreement, and for that
purpose references hereunder to "Registrable Securities" shall be deemed to
include the securities which the Holders of Registrable Securities would be
entitled to receive in exchange for Registrable Securities pursuant to any
such merger, consolidation or reorganization.
12. Miscellaneous.
-------------
(a) Suspension of Registration Obligation. The Company shall not be
-------------------------------------
required to register securities under this Agreement for any Holder at
any time when such Holder could publicly sell all of its Registrable
Securities without registration during a single 90-day period pursuant
to Rule 144 under the Securities Act or otherwise.
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<PAGE>
(b) Remedies. Any person having rights under this Agreement will be
--------
entitled to enforce them specifically, to recover damages caused by
reason of any breach of any provision of this Agreement, and to
exercise all other rights granted by law.
(c) Amendments and Waivers. Except as otherwise provided herein, this
----------------------
Agreement may be amended and the Company may take any action herein
prohibited, or fail to perform any act herein required to be performed
by it, only with the written consent of Holders of a majority of the
Registrable Securities.
(d) Successors and Assigns. All covenants and agreements in this
----------------------
Agreement by or on behalf of any of the parties hereto will bind and
inure to the benefit of the respective successors and assigns of the
parties hereto, whether so expressed or not. In addition, any
provisions of this Agreement for the benefit of Holders are also for
the benefit of, and enforceable by, any subsequent Holder of
Registrable Securities who has been expressly assigned such rights at
the time of the transfer of the Registrable Securities to him, but not
otherwise.
(e) Assignment of Registration Rights. The rights to cause the
---------------------------------
Company to register Registrable Securities pursuant to this Section 1
may be assigned (but only with all related obligations) by a Holder (a
"Permitted Transferee"), provided: (a) the Company is, within 10
business days of such transfer, furnished with written notice of the
name and address of such transferee or assignee and the securities
with respect to which such registration rights are being assigned; (b)
such transferee or assignee agrees in writing to be bound by and
subject to the terms and conditions of this Agreement; (c) immediately
following such transfer the further disposition of such securities by
the transferee or assignee is restricted under the Act; and (d) the
number of shares of Common Stock to be held by such transferee is at
least 50,000 (adjusted for stock dividends, stock splits, reverse
stock splits, combinations and the like).
(f) Severability. The invalidity or unenforceability of any provision
------------
in this Agreement in any application will not affect the validity or
enforceability of any other provision of this Agreement or of the same
provision in any other application.
(g) Notices.
-------
(i) How Given. All notices, requests, consents and other
---------
communications given pursuant to this Agreement shall be in
writing and shall be sent by first class registered mail,
postage prepaid, addressed as follows, or by facsimile
transmission directed as follows:
If to the Company, at
Advance Display Technologies, Inc.
1251 South Huron Street
-8-
<PAGE>
Denver, Colorado 80223
Attention: Darrell Avey
Facsimile: (303) 733-5363
with a copy to
David Babiarz, Esq.
Overton Babiarz & Sykes
7720 E. Belleview Ave., Suite 200
Englewood, Colorado 80111
Facsimile: (303) 779-6006
If to the Holders, to the addresses and, if applicable,
facsimile numbers, shown for such Holders on the record books of
the Company.
(ii) Deemed Receipt; Change of Address. Any such notice, request,
---------------------------------
consent or other communication shall be deemed to be received
three business days after being sent by mail, or upon
confirmation of a facsimile transmission. Any party may
designate a different address or facsimile number by notice
given to the other parties pursuant to this Section 7(f).
(h) Confidentiality of Notices. Each Holder agrees to keep strictly
--------------------------
confidential the fact that any notice has been given by the Company
under Section 1 of this Agreement until a registration statement
referred to in such notice has been filed with the Securities and
Exchange Commission, except that a Holder may disclose the existence
of such a notice to the Holder's legal, financial and tax advisors
solely for the purpose of determining how to respond to the notice and
then only if such advisors agree in writing for the benefit of the
Company to keep the existence of such notice strictly confidential.
(i) Governing Law. This Agreement will be governed by Colorado law.
-------------
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
respective dates indicated below to be effective as of the date first written
above.
COMPANY:
ADVANCE DISPLAY TECHNOLOGIES, INC., a
Colorado corporation
Date: ______________ By: /s/ Darrell Avey
-----------------------------
Name: Darrell Avey
Title: Chairman
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<PAGE>
HOLDERS:
Date: 5/9/97 /s/ Keith A. Hancock
---------- ---------------------------------
Keith A. Hancock
G. SCHNEIDER HOLDINGS CO.,
a Colorado limited partnership
Date: ________________ /s/ Gene W. Schneider
----------------------------------
Gene W. Schneider, General Partner
Date: ________________ /s/ William W. Becker
----------------------------------
William W. Becker
Date: ________________ /s/ Mark L. Schneider
----------------------------------
Mark L. Schneider
Date: ________________ /s/ Jan E. Helen
-----------------------------
Jan E. Helen
Date: ________________ /s/ William J. Elsner
----------------------------------
William J. Elsner
Date: 5/12/97 /s/ J. Timothy Brittan
----------- -----------------------------------
J. Timothy Brittan
Date: ________________ /s/ Bruce H. Etkin
-------------------------------
Bruce H. Etkin
PEREGRINE INVESTMENTS,
a Virginia general partnership
Date: ________________ By: /s/ Daryl Owen
---------------------------
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<PAGE>
Name: Daryl Owen
Title: General Partner
Date: ________________ /s/ John D. Seiver
-------------------------------
John D. Seiver
Date: ________________ /s/ John P. Cole, Jr.
----------------------------------
John P. Cole, Jr.
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