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As filed with the Securities and Exchange Commission on April 14, 1997
Securities Act File No. 333-24513 Exchange Act File No. 0-18034
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
INDENET, INC.
(Exact name of registrant as specified in its charter)
Delaware 68-0158367
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
16000 Ventura Boulevard, Suite 700
Encino, California 91436
(818) 461-8525
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
Graeme R. Jenner
Chief Executive Officer
IndeNet, Inc.
16000 Ventura Boulevard, Suite 700
Encino, California 91436
(818) 461-8525
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
With copies to:
Istvan Benko, Esq.
Troy & Gould Professional Corporation
1801 Century Park East, Suite 1600
Los Angeles, California 90067
(310) 553-4441
Approximate date of commencement of proposed sale to public:
From time to time after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, as amended (the "Securities Act"), other than
securities offered only in connection with dividend or interest reinvestment
plans, check the following box. [X]
If this Form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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PROSPECTUS
INDENET, INC.
11,492,364 SHARES OF COMMON STOCK
This Prospectus relates to the offer by the securityholders named herein
("Selling Securityholders") for sale from time to time of up to 11,492,364
shares (the "Shares") of Common Stock, $.001 par value (the "Common Stock"), of
IndeNet, Inc., a Delaware corporation ("IndeNet" or the "Company"). To the
extent required by applicable law or Securities and Exchange Commission
regulations, this Prospectus shall be delivered to purchasers upon resale of
Common Stock by the Selling Securityholders. The Shares consist of (i)
6,791,284 currently outstanding shares of Common Stock, (ii) 4,553,080 shares of
Common Stock issuable upon the conversion of the Company's currently
outstanding shares of Series C Preferred Stock, and (iii) 148,000 shares
issuable upon the exercise of currently outstanding warrants to purchase shares
of Common Stock (the "Warrants"). The number of shares of Common Stock issuable
upon the conversion of the shares of Series C Preferred Stock, and upon the
exercise of the Warrants is subject to adjustment. The Company will not receive
any proceeds from the sale of the Shares offered hereby. The Warrants contain a
"cashless" exercise provision. However, if the holders of the Warrants elect to
pay the exercise price of the Warrants in cash, the Company will receive an
aggregate of $740,000 upon the cash exercise of all of the Warrants. See, "Use
of Proceeds" and "Selling Securityholders."
The Common Stock is quoted on the Nasdaq National Market under the
symbol "INDE." The closing price of the Common Stock reported on the Nasdaq
National Market on March 26, 1997 was $2.00 per share.
The Selling Securityholders have advised the Company that they may
sell, directly or through brokers, all or a portion of the securities offered
hereby in negotiated transactions or in one or more transactions in the market
at the price prevailing at the time of sale. In connection with such sales,
the Selling Securityholders and any participating broker may be deemed to be
"underwriters" of the Common Stock within the meaning of the Securities Act of
1933, as amended. It is anticipated that usual and customary brokerage fees
will be paid by the Selling Securityholders in all open market transactions.
The Company will pay all other expenses of this offering. See "Plan of
Distribution."
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AN INVESTMENT IN THE SECURITIES OFFERED HEREBY INVOLVES
A HIGH DEGREE OF RISK. SEE "RISK FACTORS" ON
PAGES 5 THROUGH 8 OF THE PROSPECTUS.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is April 15, 1997
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") and in accordance
therewith files reports, proxy or information statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy statements and other information can be inspected and copied at the
public reference facilities maintained by the Commission at Judiciary Plaza,
450 Fifth Street, N.W., Washington, D.C. 20549, as well as at the following
regional offices: Seven World Trade Center, New York, New York 10048, and
Citicorp Center, 500 W. Madison Street, Suite 1400, Chicago, Illinois 60661.
Copies of such material can be obtained from the Public Reference Section of
the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. In addition, the Commission maintains a Web site
that contains reports, proxy and information statements and other information
regarding registrants that file electronically with the Commission. The
address of the Commission's Web site is http://www.sec.gov. The Common Stock
of the Company is quoted on the Nasdaq National Market. Reports, proxy
statements and other information concerning the Company may be inspected at the
offices of the National Association of Securities Dealers, Inc. at 1735 K
Street, N.W., Washington, D.C. 20006.
Additional information regarding the Company and the securities offered
hereby is contained in the Registration Statement of which this Prospectus is a
part, and the exhibits thereto, filed with the Commission under the Securities
Act of 1933, as amended (the "Securities Act"). For further information
pertaining to the Company and the securities offered hereby, reference is made
to the Registration Statement and the exhibits thereto, which may be inspected
without charge at, and copies thereof may be obtained at prescribed rates from,
the office of the Commission at Judiciary Plaza, 450 Fifth Street, Washington,
D.C. 20549. Statements contained herein concerning the provisions of any
document are not necessarily complete and in each instance reference is made to
the copy of the document filed as an exhibit or schedule to the Registration
Statement. Each such statement is qualified in its entirety by reference to
the copy of the applicable documents filed with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission under
the Exchange Act are incorporated in this Prospectus by reference: (a) the
Company's Annual Report on Form 10-KSB for the year ended March 31, 1996, filed
with the Commission on June 30, 1996, as amended by Form 10-KSB/A, filed on
January 17, 1997; (b) the Company's quarterly report on Form 10-QSB for the
quarter ended June 30, 1996, filed with the Commission on August 14, 1996, as
amended by Form 10-QSB/A, filed on January 17, 1997; (c) the Company's quarterly
report on Form 10-QSB for the quarter ended September 30, 1996, filed with the
Commission on November 14, 1996; (d) the Company's quarterly report on Form
10-QSB for the quarter ended December 31, 1996, filed with the Commission on
February 14, 1997; (e) the Company's current report on Form 8-K dated February
7, 1996, filed with the Commission on February 22, 1996, as amended by Form
8-K/A, filed on April 22, 1996; (f) the Company's current report on Form 8-K,
filed with the Commission on May 13, 1996, as amended by Form 8-K/A, filed on
May 14, 1996; (g) the Company's current report on Form 8-K dated May 16, 1996,
filed with the Commission on May 31, 1996; (h) the Company's current report on
Form 8-K dated May 24, 1996, filed with the Commission on June 7, 1996, as
amended by Form 8-K/A, filed on August 5, 1996; (i) the Company's current report
on Form 8-K dated March 24, 1997, filed with the Commission on April 8, 1997;
(j) the Company's proxy statement furnished in connection with its Annual
Meeting of Shareholders on September 16, 1996, filed with the Commission on
August 16, 1996; (k) the Company's proxy statement furnished in connection with
its Special Meeting of Shareholders on February 13, 1997, filed with the
Commission on January 17, 1997; and (l) the description of the Common Stock set
forth in the Company's Registration Statement on Form 8-A under the Exchange Act
filed with the Commission on October 12, 1989, including any amendment or report
subsequently filed by the Company for the purpose of updating that description.
The file number of each of the foregoing documents is 0-18034.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the securities offered hereby shall
be deemed to be incorporated by reference into this Prospectus and to be a part
of this Prospectus from the date of filing of such documents. Any statement
contained in a document incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein
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modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, on the written or oral request of any such person, a
copy of any or all of the documents incorporated by reference (other than
exhibits to such documents that are not specifically incorporated by reference
in such documents). Written requests for such copies should be directed to
Richard J. Parent, Chief Financial Officer and Secretary, IndeNet, Inc., 16000
Ventura Boulevard, Suite 700, Encino, California 91436. Telephone requests may
be directed to Mr. Parent at (818) 461-8525.
Safe Harbor Statement under the Private Securities Litigation Reform
Act of 1995.
Except for the historical information contained herein, the matters
discussed in this Prospectus are forward-looking statements which involve risks
and uncertainties, including but not limited to economic, competitive,
governmental and technological factors affecting the Company's revenues,
operations, markets, products and prices, and other factors discussed in the
section entitled "Risk Factors" on pages 5 through 8 of this Prospectus.
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THE COMPANY
Since commencing its current business in February 1995, IndeNet, Inc.,
through its consolidated subsidiaries, has emerged as a provider of:
o television advertisement spot delivery services for national
advertisers and television programmers, and
o computer systems and equipment for the management of
advertisement spots and the insertion of ad spots into
television programs.
The Company is also currently deploying The IndeNet Digital Broadcast
Network(TM) ("The IndeNet"), a computer-based, MPEG 2 standard, digital
satellite network. Substantially all spot ads in the television support
industry are currently delivered in analog format, mostly on video tape by
overnight mail. Once the Company's network is fully deployed, The IndeNet will
be able to deliver spot ads instantaneously and simultaneously to hundreds of
stations in a digital format. Because of the distribution benefits of digital
transmissions, the superior quality of digital video and audio, and because of
the computer editing capabilities of digital deliveries, the Company believes
that The IndeNet has the potential to materially change and improve the manner
in which most television spot ads are distributed in the television industry.
The Company's goal is to offer the television industry a complete,
integrated range of support services, including those related to the sale and
purchase of spot advertising time, the delivery of the ads, the scheduling of
air time, the insertion of the ads into the television programming, the
verification of the airing, and the billing for the airing. In pursuit of this
goal, the Company has targeted acquisition candidates with a history of
operations, an established customer base, strong market share, and a stable
source of revenues. The Company believes that the successful implementation of
its goals will benefit the television industry by reducing the cost and time
required to transact the everyday business between the key parties.
Since February 1995, IndeNet has consummated five acquisitions, all of
which are in the Company's business segment. On March 24, 1997, IndeNet sold
all of its interests in one of the acquired companies, Channelmatic, Inc. The
acquired companies were assembled to establish a horizontally integrated network
of television support services that the Company is able to offer to advertisers,
television programmers, television stations and cable operators. The Company
may pursue the possible acquisition of other companies that will allow the
Company to expand its client base or the range of products and services it can
offer to advertisers, programmers, television stations and cable operators.
The Company currently distributes national spot broadcast advertising
to virtually all of the top United States television stations and cable
systems. In addition, the Company's television broadcast traffic, billing and
management software is installed in over 140 U.S. television stations (which
serve an estimated 50% of the total U.S. television advertising market) and 70
television stations located in the United Kingdom, Western Europe, New Zealand,
Australia, Southeast Asia and South Africa. Additionally, the Company's cable
industry traffic and billing software is installed in approximately 240 cable
systems, primarily in the U.S. The Company's advertising insertion hardware is
used by approximately 1,200 cable suppliers in the United States. The
Company's clients include such accounts as McDonald's Corporation (4.9%), Coca
Cola (3.8%), King World Syndicated Programming (4.4%), Questar Home Video
(0.5%), TCI (2.8%), Time Warner (0.8%), NBC Television Stations (1.4%) and Fox
Television Stations (0.6%). The percentages in parentheses represent the
approximate percentile contribution by each of the foregoing clients to the
Company's revenues for the fiscal year ended March 31, 1996.
IndeNet was originally founded as a Colorado corporation on April 4,
1988 and was re-organized under the laws of the State of Delaware on July 17,
1995. Prior to October 31, 1993, IndeNet provided the media communications
industry with various support services, including audiotext and conferencing
applications and bank card settlement and clearing services. Effective October
31, 1993, IndeNet sold all of its operating assets with the intent to
transition into a new line of business utilizing the proceeds from the sale.
Effective February 3, 1995, IndeNet acquired Mediatech, Inc. ("Mediatech"),
which became the first operating subsidiary of IndeNet. On November 27, 1995,
IndeNet acquired a 66.67% interest in Channelmatic, Inc. ("Channelmatic") and
on February 7, 1996 it completed the acquisition of Starcom Television
Services, Inc. ("Starcom"). On May 16, 1996, IndeNet acquired Cable
Computerized Systems Management, Inc. ("CCMS") and on May 24, 1996, IndeNet
acquired
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Enterprise Systems Group Limited and its subsidiaries ("Enterprise"). On March
24, 1997, IndeNet sold all of its interests in Channelmatic. The Company's
principal executive office is located at 16000 Ventura Boulevard, Suite 700,
Encino, California 91436. Its telephone number is (818) 461-8525.
RISK FACTORS
The securities offered hereby are speculative in nature, involve a high
degree of risk, and should not be purchased by any investor who cannot afford
the loss of his entire investment. Prior to making an investment decision with
respect to the securities offered hereby, prospective investors should
carefully consider, along with the other matters discussed in this Prospectus,
the following risk factors:
PRIOR AND ANTICIPATED LOSSES. The Company has experienced net losses
during each of its last two fiscal years. In addition, even after giving effect
to all of the five acquisitions as if all such acquisitions had been consummated
on April 1, 1995, the Company would have had a net loss of $3,026,000 for the
fiscal year ended March 31, 1996. The Company does not expect to achieve
profitability during the fiscal year ended March 31, 1997 or during the current
fiscal year. Although certain of the Company's subsidiaries have operated
profitably on a stand-alone basis, the ability of the Company as a whole to
achieve profitability will be dependent upon numerous factors, including the
operations of the Company's various subsidiaries, the Company's ability to
integrate the operations of its various businesses, and the ability to deploy
and operate The IndeNet, the Company's digital broadcast network. In addition,
as a result of the acquisitions of its subsidiaries, the Company recorded
Goodwill and Customer List as intangible assets on its balance sheet, which are
to be amortized 20 years and 15 years, respectively. As of December 31, 1996,
the Company had approximately $15.4 million in Goodwill and $14.4 million in
Customer List. Although the amount of Goodwill has been reduced due to the
recent sale of Channelmatic, the Company's future earnings, if any, will
continue to be negatively impacted by the annual amortization charges resulting
from the Goodwill and Customer List remaining in the Company's accounting
records. There can be no assurance that the value of such goodwill or customer
list will ever be realized by the Company or that the Company will achieve
profitability in any future period.
HOLDING COMPANY. The Company is a holding company which generates no
independent revenue and is completely dependent on the operations of its
subsidiaries for cash flow. Certain of such subsidiaries do not generate
positive cash flow, and certain of the subsidiaries have significant
indebtedness, the repayment of which uses such subsidiaries' excess cash flow.
Accordingly, the Company may be unable to obtain any cash from its
subsidiaries. The Company has also guaranteed certain of the indebtedness of
the subsidiaries. The payment of dividends from the subsidiaries to the
Company and the payment of any interest on or the repayment of any principal of
any loans or advances made by the Company to any of its subsidiaries may be
subject to statutory or contractual restrictions and are contingent upon the
earnings of such subsidiaries. The credit and loan agreements entered into by
certain of its subsidiaries contain restrictions on the ability of such
subsidiaries to pay dividends to the Company or to make loans to the Company.
LIMITED HISTORY OF OPERATIONS. Prior to the acquisition of its first
subsidiary in February 1995, the Company had no operating business or revenue.
Since February 1995, the Company has acquired four other subsidiaries, one of
which was sold on March 24, 1997. Although all of the subsidiaries that the
Company now owns are established companies with lengthy operating histories
(three subsidiaries have been operating for more than 10 years), the Company
itself has no history in operating these companies.
RISKS RELATED TO DIGITAL BROADCAST NETWORK. An important element in the
Company's future plan of operations is to provide a complete range of broadcast
network services to advertisers, programmers and television stations, which
will in turn depend in significant part upon the success of The IndeNet, the
Company's digital network satellite delivery system. In order for the
television broadcast stations and cable operators to be able to receive and use
advertisements or programming that is distributed digitally via The IndeNet,
the stations and cable operators need to install the Company's SpotServers.
The Company commenced deploying its satellite network in 1996 by installing at
television stations the equipment necessary to receive and use the digital
transmissions. The Company believes that approximately 350 to 400 SpotServers
need to be installed before The IndeNet can be viable. To date, the Company
has installed only approximately 100 SpotServers. The Company is currently
engaged in a comprehensive review of its over-all long-term business plan,
including the operations of The IndeNet. Accordingly, no assurance can be given
that the deployment of 400 SpotServers can be achieved. If the Company's
digital satellite network does not achieve the minimum degree of market
acceptance,
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there could be a material adverse impact on the Company's business, financial
condition and results of operations. In addition, failure to implement The
IndeNet could prevent the Company from recouping the equipment costs and other
start-up expenses incurred by the Company in connection with the deployment of
the satellite network. Although the Company has operated The IndeNet on a
limited basis at several television stations, the entire digital network
satellite system has not yet been fully implemented and may, therefore, require
additional modifications or technological alterations.
HIGHLY COMPETITIVE ENVIRONMENT; RAPID TECHNOLOGICAL ADVANCES.
Competition in each of the Company's businesses is highly competitive. Each of
the Company's subsidiaries competes in its business with numerous competitors
and potential competitors, many of whom are substantially larger in size and
have greater financial, technical, marketing, customer service and other
resources available than the Company. Certain of the Company's competitors and
potential competitors have technological capabilities or other resources that
would allow them to develop alternative products or provide alternative
services which could compete directly with the Company's products and services.
The Company's competitors in the digital delivery market include Vyvx,
Inc., a leading provider of integrated satellite and fiber-optic video
transmission services. In addition, Digital Generation Systems, Inc., a major
provider of electronic distribution services for radio stations, has also
announced that it intends to expand its existing operations into the television
advertising market and that it also intends to establish and operate a digital
satellite distributions network.
The Company's future success and its ability to remain competitive will
depend in significant part upon the technological quality of its products and
processes relative to those of its competitors and its ability both to develop
new and enhanced products and services and to introduce such products and
processes at competitive prices and in a timely and cost-effective manner. All
of the Company's current operations are subject to rapid technological changes
due primarily to the computerization and digitalization of the television
services industry and to the technological changes occurring in the broadcast
industry. No assurance can be given that the Company will be able to develop
new and enhanced products and services at competitive prices and in a timely
manner.
The markets for the Company's software products are characterized by
evolving industry standards, rapid technological advances resulting in short
product life cycles, price reductions, significant price/performance
improvements and frequent new products introductions. The Company's future
success in the television services business will depend at least in part upon
its ability to continually enhance its existing automated program playback
systems and to enhance its traffic and billing, revenue management and other
program management software products, and to develop and introduce new hardware
and software products and features that meet changing customer requirements and
emerging industry standards on a timely basis. There can be no assurance that
one or more of the Company's products will not be rendered noncompetitive or
obsolete by technological advances or changing customer preferences. The
Company has in the past experienced delays in introducing new products and
product enhancements, and there can be no assurance that the Company will not
experience difficulties that could delay or prevent the successful development,
introduction and marketing of new products or product enhancements in the
future.
RELIANCE ON INTEGRATION OF BUSINESSES. The Company has recently
experienced a period of rapid growth through the acquisition of its
subsidiaries, which growth has resulted in new and increased responsibilities
for management personnel and has placed and continues to place increasing
demands on the Company's management, operational and financial systems and
resources. In order to achieve the synergies that the Company believes can
result from its recent acquisitions, the Company intends to consolidate and
integrate certain operations of its subsidiaries. However the assimilation and
integration of the various businesses of the subsidiaries may be hampered
because the subsidiaries are located in various states and countries and
operate in different, albeit similar, businesses. There can be no assurance
that the Company will be able to successfully integrate the operations of its
various subsidiaries.
RESTRUCTURING. During the last calendar quarter of 1996, the Company
initiated a plan to integrate and restructure the operations of its various
subsidiaries. As a result of the restructuring, in the fiscal quarter ended
December 31, 1996, the Company took a $8.5 million charge to earnings as a
write down of Goodwill and other depreciable assets, and took an additional
restructuring charge to earnings in the amount of $1.6 million. The
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amount of the foregoing restructuring charge and write down increased the
Company's third quarter losses to $12 million. Furthermore, no assurance can
be given that the reorganization plan will not, at least in the short term,
adversely affect the Company's operations.
VOLATILE MARKET FOR COMMON STOCK. There is no assurance that a regular
trading market for the Company's securities will be sustained. The market
price for the Company's Common Stock may be significantly affected by such
factors as the Company's financial performance, the market price of its
competitors' stock, or market conditions in general. The Company's stock price
has been particularly volatile. During the past 12 months, the Company's Common
Stock has traded in a range between $7.25 per share and $1.50 per share.
Additionally, in recent years, the stock market has experienced a high level of
price and volume volatility for many companies, particularly small and emerging
growth companies traded in the over-the-counter market, and these wide price
fluctuations are not necessarily related to the operating performance of these
companies. Accordingly, there may continue to be significant volatility in the
market for the Company's securities. The Common Stock offered by this
Prospectus constitutes approximately 68% of the total amount of Common Stock
currently outstanding. The Common Stock offered hereby may be offered and sold
from time to time throughout an indefinite and extended period of time. Such
sales may have an adverse effect on the prevailing market price for the Common
Stock. The extent of such adverse effect, if any, cannot be predicted, but
based on the volume of trading in the market and on the number of shares that
could be sold hereunder by the Selling Securityholders, such adverse effect may
be material.
LITIGATION. On April 26, 1996, the Company sold 1,200 shares of its
Series A Preferred Stock in an offering which was exempt from registration
pursuant to Regulation S of the Securities Act. The Series A Preferred Stock
is convertible into Common Stock, pursuant to certain restrictions. Due to
what was believed to be highly unusual and suspicious trading activity in the
Company's Common Stock in breach of the subscription agreements for the Series
A Preferred Stock, the Company announced that it would no longer convert the
Series A Preferred Stock into shares of Common Stock. The Company had reached
agreement with holders of 75% of the outstanding Series A Preferred Stock to
exchange their shares of the Series A Preferred Stock into Series C Preferred
Stock and warrants to purchase Common Stock. However, the Company is still in
dispute with the owners of 250 shares of Series A Preferred Stock. One of the
dissenting investors has filed a lawsuit against the Company to force the
Company to convert the investor's Series A Preferred Stock. If the investor is
successful in the foregoing lawsuit, the Company could be forced to issue a
significant number of shares of Common Stock. The issuance and resale of such
shares could have a material adverse effect on the trading price of the Common
Stock. In addition, the other investors who have not agreed to the exchange of
the Series A Preferred Stock for the Series C Preferred Stock have also
threatened to file a lawsuit against the Company.
The Company is also a party to certain litigation, which if resolved
adversely to the Company could have a material adverse effect on its financial
condition.
DIVIDENDS UNLIKELY. The Company has never paid cash dividends on its
Common Stock and anticipates that for the foreseeable future all earnings, if
any, will be retained for operations and for the development of the Company's
assets and business. The Company's ability to pay any dividends is dependent
on its financial condition and on Delaware law. Under Delaware law, a
corporation is permitted to pay dividends only out of surplus (including
paid-in and earned surplus) or out of net profits for the current and
immediately preceding fiscal years. No assurance can be given that the Company
will in the future be permitted under Delaware law to pay dividends.
DEPENDENCE ON KEY PERSONNEL. The Company's future success depends in
large part on the continued service of its key marketing, research and
development and management personnel. The Company is dependent upon its
ability to identify, hire, train, retain and motivate high quality personnel,
especially highly skilled engineers involved in the development and
implementation of The IndeNet. The Company is particularly dependent on the
skills and contributions of certain of its management personnel. Competition
for personnel in the Company's industry is characterized by a high level of
employee mobility and aggressive recruiting of skilled personnel. There can be
no assurance that the Company's current employees will continue to work for the
Company or that the Company will be able to obtain the services of additional
personnel necessary for the Company's growth.
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AUTHORIZATION OF PREFERRED STOCK; PROVISIONS AFFECTING CHANGES IN
CONTROL. The Company's Certificate of Incorporation authorizes the issuance of
"blank check" preferred stock with such designation, rights and preferences as
may be determined from time to time by the Board of Directors. Accordingly,
the Board of Directors is empowered, without stockholder approval, to issue a
new series of preferred stock with dividend, liquidation, conversion, voting or
other rights which could adversely affect the voting power or other rights of
the holders of the Company's Common Stock. In the event of issuance, the new
series of preferred stock could be utilized, under certain circumstances, as a
method of discouraging, delaying or preventing a change in control of the
Company. Although the Company has no present intention to issue any additional
shares of its preferred stock, there can be no assurance that the Company will
not do so in the future.
USE OF PROCEEDS
The Company will not receive any proceeds for the conversion of the
shares of Series C Preferred Stock. The Warrants can be exercised either for
cash, at a price of $5.00 per share, or pursuant to a cashless exercise
provision contained in the Warrants. The Company intends to use any cash
proceeds that it may receive from the cash exercise of the Warrants for working
capital purposes. The Company will not otherwise receive any of the proceeds
from the sale by the Selling Securityholders of any of the Shares offered
hereby. The Company will pay all of the costs of this offering.
SELLING SECURITYHOLDERS
The Shares offered hereby represent shares of (i) Common Stock
previously issued by the Company to the Selling Securityholders in connection
with the acquisition by the Company of Mediatech in February 1995, the
acquisition of Channelmatic in November 1995, the acquisition of Starcom in
February 1996, and the acquisition of both CCMS and Enterprise in May 1996
(collectively, the "Acquisitions"), (ii) Common Stock issued upon the conversion
of certain convertible promissory notes issued as consideration in connection
with the acquisitions of Mediatech and Enterprise, (iii) Common Stock issued or
issuable upon conversion of the currently outstanding shares of the Company's
Series C Preferred Stock, and (iv) Common Stock issuable upon the exercise of
the Warrants. The Warrants are owned by the holders of the Series C Preferred
Stock and were acquired by them in connection with their acquisition of the
Series C Preferred Stock. In connection with the Acquisitions and the issuance
of the Series C Preferred Stock and Warrants, the Company entered into
registration rights agreements that require the Company to register the shares
of Common Stock issued or issuable to the Selling Securityholders. The Shares
have been registered pursuant to such registration rights provisions.
The terms of the Acquisitions and the issuance of the Series C
Preferred Stock were determined by arm's-length negotiations between the
Company and the Selling Securityholders. Neither the Selling Securityholders
nor their affiliates had or has any material relationship with the Company or
its officers, directors or affiliates except as noted in the table below.
The following table sets forth as of the date of this Prospectus the
number and percent of shares of Common Stock beneficially owned by the Selling
Securityholders, the number of shares of Common Stock offered hereby by the
Selling Securityholders, and the number and percent of shares of Common Stock
to be held by the Selling Securityholders after the conclusion of this
offering.
8.
<PAGE> 10
<TABLE>
<CAPTION>
BEFORE OFFERING AFTER OFFERING
------------------------ ------------------------
NUMBER OF NUMBER OF
SHARES NUMBER OF SHARES
SELLING BENEFICIALLY SHARES BENEFICIALLY
SECURITYHOLDERS OWNED(1) PERCENT BEING OFFERED OWNED(1)(2) PERCENT
--------------- -------- ------- ------------- ----------- -------
<S> <C> <C> <C> <C> <C>
Robert F. McConnell(3) 37,117 * 17,117 20,000 *
Clinton Leroy Bulkley(3) 16,749 * 11,749 5,000 *
George Theodore Beattie(3) 8,453 * 8,453 0 0
Lynda D. Johnson(3) 5,909 * 3,909 2,000 *
Joseph Robert Lennon(3) 8,170 * 3,170 5,000 *
Betty M. Amon(3) 530 * 530 0 0
Amy D. Simmons(3) 500 * 500 0 0
Kathleen J. Micci(3) 379 * 379 0 0
Ryan Rodney Rockwell(3) 318 * 318 0 0
Christopher J. Lennon(3) 318 * 318 0 0
Kathleen E. Lennon(3) 318 * 318 0 0
Betty L. Matkin(3) 318 * 318 0 0
Richard Lee Schleufer(3)(9) 190,203 1.12 65,203 125,000 *
Abacus (Nominees) Ltd.(3) 246,306 1.46 246,306 0 0
Advent Nominees Ltd.(3) 153,357 * 153,357 0 0
CIN Venture Nominees Ltd.(3) 786,714 4.65 786,714 0 0
Commercial Union Life 78,006 * 78,006 0 0
Assurance(3)
Commercial Union Nominees 52,004 * 52,004 0 0
Ltd.(3)
Legal & General Assurance 108,220 * 108,220 0 0
Society Ltd.(3)
Thompson Clive Investments 90,252 * 90,252 0 0
PLC(3)
Thompson Clive Ventures(3) 154,933 * 154,933 0 0
Thompson Clive Ventures LP(3) 55,656 * 55,656 0 0
Peter Rhodes Dimmer(3) 184,625 1.09 184,625 0 0
Michael John Boxford(3) 12,574 * 12,574 0 0
Magna Standard Trust(3) 167,366 * 167,366 0 0
Susan Mary Pacey(3) 7,071 * 5,071 2,000 *
Michael John Pacey(3) 29,234 * 29,234 0 0
Shiela Lillian Martin(3) 10,143 * 10,143 0 0
Barnaby John Gibbens(3) 12,937 * 12,937 0 0
Philip Sansome(3) 26,200 * 6,200 20,000 *
Joseph James Frazer(3) 8,381 * 3,381 5,000 *
Edith Peakman Frazer(3) 2,113 * 2,113 0 0
Raymond Vidler(3) 8,804 * 3,804 5,000 *
Roger James Carmody(3) 2,576 * 2,576 0 0
Valerie Lesley Dianne Hill(3) 2,758 * 758 2,000 *
</TABLE>
9.
<PAGE> 11
<TABLE>
<CAPTION>
BEFORE OFFERING AFTER OFFERING
------------------------ ------------------------
NUMBER OF NUMBER OF
SHARES NUMBER OF SHARES
SELLING BENEFICIALLY SHARES BENEFICIALLY
SECURITYHOLDERS OWNED(1) PERCENT BEING OFFERED OWNED(1)(2) PERCENT
--------------- -------- ------- ------------- ----------- -------
<S> <C> <C> <C> <C> <C>
Lee Anne Fredrick(3) 2,758 * 758 2,000 *
Philip James Welch(3) 2,758 * 758 2,000 *
Alan Brown B. Wilson(3) 2,758 * 758 2,000 *
Lilla Ajgaonkar Wylie(3) 2,758 * 758 2,000 *
Julian Paul Watkin(3) 318 * 318 0 0
Graeme Ronald Jenner(3)(10) 286,769 1.68 86,769 200,000 1.17
David William Martin(3) 78,731 * 23,731 55,000 *
Fifth Dimension Communications 265,745 1.57 194,025 71,720 *
Holdings, Inc.(4)
Starcom Television Services, 105,900 * 105,900 0 0
Inc.(4)
Andre A. Blay Trust(4)(11) 261,232 1.54 215,399 45,833 *
Wayne Kennedy and Lerile 45,113 * 45,113 0 0
Rockwell(4)
Rabiner Partners(4) 22,594 * 22,594 0 0
James A. Miller and Mary G. 22,594 * 22,594 0 0
Miller(4)
The Dimitri Villard Revocable 14,344 * 14,344 0 0
Living Trust(4)
Laidlaw & Co.(4) 17,531 * 17,531 0 0
S. Michael Ross(5)(12) 328,279 1.93 268,279 60,000 *
Judith K. Thome(5)(13) 328,279 1.93 268,279 60,000 *
John W. Sorensen(5)(14) 91,054 * 51,054 40,000 *
Thomas H. Baur(6)(15) 1,687,030 9.92 1,587,030 100,000 *
Robert Derham(6)(16) 291,780 1.70 56,780 235,000 1.37
Killer Barn, Inc.(7)(17) 1,530,000 9.05 1,530,000 0 0
Wood Gundy London(8) 511,880 3.03 511,880 0 0
Comeron Capital(8) 703,835 4.16 703,835 0 0
Reg-S Investment Fund(8) 157,145 * 157,145 0 0
Banque Edouard Constant SA 1,029,795 6.09 1,029,795 0 0
(formerly Bank Scandinave en
Suisse)(8)
Faisal Finance(8) 285,115 1.69 285,115 0 0
The Tail Wind Fund(8) 378,275 2.24 378,275 0 0
Legong Investments(8) 255,940 1.51 255,940 0 0
Richcourt $ Strategies(8) 215,295 1.27 215,295 0 0
</TABLE>
10.
<PAGE> 12
<TABLE>
<CAPTION>
BEFORE OFFERING AFTER OFFERING
------------------------ ------------------------
NUMBER OF NUMBER OF
SHARES NUMBER OF SHARES
SELLING BENEFICIALLY SHARES BENEFICIALLY
SECURITYHOLDERS OWNED(1) PERCENT BEING OFFERED OWNED(1)(2) PERCENT
--------------- -------- ------- ------------- ----------- -------
<S> <C> <C> <C> <C> <C>
Grace Church & Co.(8) 424,755 2.51 424,755 0 0
Charles Kucey(8) 157,145 * 157,145 0 0
Cornerstone Capital(8) 75,655 * 75,655 0 0
Societe Generale(8) 506,245 2.99 506,245 0 0
___________ ___________ __________
12,558,917 11,492,364 1,066,553
</TABLE>
______________
* less than 1%.
(1) Pursuant to the rules promulgated under the Exchange Act, a person is
deemed to be the beneficial owner of a security if that person has the
right to acquire ownership of such security within 60 days.
(2) The table assumes that the Selling Securityholders will dispose of all
Shares owned by them or issuable to them that are being registered for
sale by this Prospectus.
(3) Selling Securityholders that were issued shares of Common Stock in
connection with the acquisition of Enterprise. The Shares of such
Selling Securityholders include shares of Common Stock issued upon
conversion of notes issued as part of the consideration for the
acquisition.
(4) Selling Securityholders that were issued shares of Common Stock in
connection with the acquisition of Starcom. Each Selling
Securityholder is limited to selling not more than 1/24 of such
Selling Securityholder's initial holding of Shares, during each
calendar month for two years commencing February 1, 1997.
(5) Selling Securityholders that were issued shares of Common Stock in
connection with the acquisition of CCMS. Each Selling Securityholder
is limited to selling not more than 1/24 of such Selling
Securityholder's initial holding of Shares, during each calendar month
for two years commencing May 16, 1997.
(6) Selling Securityholders that were issued shares of Common Stock in
connection with the acquisition of Mediatech. The Shares of such
Selling Securityholders include shares of Common Stock issued upon
conversion of promissory notes that were issued as part of the
consideration for the acquisition of Mediatech.
(7) Selling Securityholder that was issued shares of Common Stock in
connection with the acquisition of Channelmatic.
(8) Selling Securityholders of shares of Common Stock issued or issuable
upon conversion of the Series C Preferred Stock and the exercise, for
cash, of the Warrants. The number of shares issuable upon a
"cashless" exercise will be less than upon a cash exercise.
(9) Mr. Schleufer has served as director of IndeNet and has served as
Chief Executive Officer of Enterprise since September 1996. Mr.
Schleufer is also the Chief Executive Officer of IndeNet's
Broadcast/Cable Services Division.
(10) Mr. Jenner was the Chief Executive Officer of Enterprise from 1987
until September 1996, and the Chief Operating Officer of IndeNet from
September 1996 until March 1997. Mr. Jenner was appointed as the
Chief Executive Officer of IndeNet in April 1997 and is a director
of IndeNet.
11.
<PAGE> 13
(11) The Andre A. Blay Trust is affiliated with Mr. Andre A. Blay, who has
served as a director of IndeNet since February 1996.
(12) Mr. Ross was Chief Executive Officer of CCMS until February 1997.
(13) Ms. Thome has been an officer of CCMS since May 1996.
(14) Mr. Sorensen has been an officer of CCMS since the acquisition of CCMS
by IndeNet in May 1996 and has been the general manager of CCMS since
February 1997.
(15) Mr. Baur has served as director of IndeNet since March 1995 and has
served as the Chairman and Chief Executive Officer of Mediatech since
1975.
(16) Mr. Derham has served as Executive Vice President and Managing
Director of Mediatech since 1983. Mr. Derham has served as Chief
Executive Officer of Mediatech since April 1996.
(17) Killer Barn, Inc. is owned and controlled by Mr. William D. Killion
who served as a director of IndeNet from November 1995 until February
1997.
12.
<PAGE> 14
PLAN OF DISTRIBUTION
The Selling Securityholders may sell, directly or through brokers, the
shares of Common Stock in negotiated transactions or in one or more transactions
in the market at the price prevailing at the time of sale. In connection with
such sales, the Selling Securityholders and any participating broker may be
deemed to be "underwriters" of the shares of Common Stock within the meaning of
the Securities Act, although the offering of these securities will not be
underwritten by a broker-dealer firm. Sales in the market may be made to
broker-dealers making a market in the Common Stock or other broker-dealers, and
such broker-dealers, upon their resale of such securities, may be deemed to be
"selling securityholders" in this offering. The NASD member firms who make a
market in the Company's Common Stock, as most recently reported to the Company
by The Nasdaq Stock Market, include Bear, Stearns & Co. Inc.; Mayer & Schweitzer
Inc.; Cruttenden & Company; L.T. Lawrence & Co.; Herzog, Heine, Geduld, Inc.;
Josephthal Lyon & Ross; Sherwood Securities Corp.; Knight Securities L.P.; and
Troster Singer Corp, among others. Pursuant to the terms under which the Shares
were sold, the Company has agreed to indemnify the Selling Securityholders
against such liabilities as they may incur as a result of any untrue statement
of a material fact in the Registration Statement of which this Prospectus forms
a part, or any omission herein or therein to state a material fact necessary in
order to make the statements made, in the light of the circumstances under which
they were made, not misleading. Such indemnification includes liabilities that
the Selling Securityholders may incur under the Securities Act.
The Company will bear all costs and expenses of the registration under
the Securities Act and certain state securities laws of the Common Stock, other
than fees of counsel (if any) for the Selling Securityholders and any discounts
or commissions payable with respect to sales of such securities.
From time to time this Prospectus will be supplemented and amended as
required by the Securities Act. During any time when a supplement or amendment
is so required, the Selling Securityholders are required to cease sales until
the Prospectus has been supplemented or amended.
LEGAL MATTERS
The validity of the securities offered hereby has been passed upon by
Troy & Gould Professional Corporation, Los Angeles, California.
EXPERTS
The audited consolidated financial statements contained in the Annual
Report on Form 10-KSB and Form 10-KSB/A of the Company for the year ended March
31, 1996, and incorporated in this Prospectus by reference, have been so
incorporated in reliance on the reports of BDO Seidman, LLP, independent public
accountants, given on the authority of said firm as experts in auditing and
accounting.
13.
<PAGE> 15
=================================================
No dealer, salesman or other person has
been authorized to give any information or make
any representations, other than those contained
in this Prospectus, in connection with the
offering hereby, and, if given or made, such
information and representations must not be
relied upon as having been authorized by the
Company or the Selling Securityholders. This
Prospectus does not constitute an offer to sell,
or a solicitation of an offer to buy, any
securities to any person in any State or other
jurisdiction in which such offer or solicitation
is unlawful. Neither the delivery of this
Prospectus nor any sale made hereunder shall,
under any circumstances, create any implication
that there has been no change in the affairs of
the Company or the facts herein set forth since
the date hereof.
_______________
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Available Information . . . . . . . . 2
Incorporation of Certain
Documents by Reference . . . . . . 2
The Company . . . . . . . . . . . . . 4
Risk Factors . . . . . . . . . . . . 5
Use of Proceeds . . . . . . . . . . . 8
Selling Securityholders . . . . . . . 8
Plan of Distribution . . . . . . . . 13
Legal Matters . . . . . . . . . . . . 13
Experts . . . . . . . . . . . . . . . 13
</TABLE>
11,492,364 Shares of Common Stock
INDENET, INC.
------------
PROSPECTUS
-------------
April 15, 1997
=================================================
<PAGE> 16
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The Company estimates that expenses in connection with the
distribution described in this Registration Statement will be as follows. All
expenses incurred with respect to the distribution will be paid by the Company,
and such amounts, with the exception of the Securities and Exchange Commission
registration fees, are estimates.
<TABLE>
<S> <C>
SEC registration fee . . . . . . . . . . . . . . . . . $ 6,408
Nasdaq listing fees . . . . . . . . . . . . . . . . . 17,500
Blue Sky fees and expenses . . . . . . . . . . . . . . 500
Accounting fees and expenses . . . . . . . . . . . . . 2,000
Legal fees and expenses . . . . . . . . . . . . . . . 10,000
Printing and engraving expenses . . . . . . . . . . . 4,000
Miscellaneous . . . . . . . . . . . . . . . . . . . . 2,000
-------
Total . . . . . . . . . . . . . . . . . . . . . . . $42,408
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Pursuant to Section 102(b)(7) of the General Corporation Law of the
State of Delaware (the "GCL"), the Certificate of Incorporation of the Company
eliminates the liability of the Company's directors to the Company or its
stockholders, except for liabilities related to breach of duty of loyalty,
actions not in good faith, and certain other liabilities.
The Certificate of Incorporation, and the Bylaws of the Company
provide for the indemnification of directors and officers to the fullest extent
permitted by the GCL.
Section 145 of the GCL authorizes indemnification when a person is
made a party to any proceeding by reason of the fact that such person is or was
a director, officer, employee or agent of the corporation or was serving as a
director, officer, employee or agent of another enterprise, at the request of
the corporation, and if such person acted in good faith and in a manner
reasonably believed by him or her to be in, or not opposed to, the best
interests of the corporation. With respect to any criminal proceeding, such
person must have had no reasonable cause to believe that his or her conduct was
unlawful. If it is determined that the conduct of such person meets these
standards, he or she may be indemnified for expenses incurred and amounts paid
in such proceeding if actually and reasonably incurred by him or her in
connection therewith.
If such a proceeding is brought by or on behalf of the corporation
(i.e., a derivative suit), such person may be indemnified against expenses
actually and reasonably incurred if he or she acted in good faith and in a
manner reasonably believed by him or her to be in, or not opposed to, the best
interests of the corporation. There can be no indemnification with respect to
any manner as to which such person is adjudged to be liable to the corporation;
however, a court may, even in such case, allow such indemnification to such
person for such expenses as the court deems proper. Where such person is
successful in any such proceeding, he or she is entitled to be indemnified
against expenses actually and reasonably incurred by him or her. In all other
cases, indemnification is made by the corporation upon determination by it that
indemnification of such person is proper because such person has met the
applicable standard of conduct.
The registration rights agreements between the Company and the Selling
Securityholders provide that the Company shall indemnify the Selling
Securityholders, and the Selling Securityholders shall indemnify the Company
and the officers and directors of the Company, for certain liabilities,
including certain liabilities under the Securities Act.
(i)
<PAGE> 17
ITEM 16. EXHIBITS
The following exhibits, which are furnished with this Registration
Statement or incorporated by reference, are filed as part of this Registration
Statement:
<TABLE>
<CAPTION>
Exhibit
No. Description
--- -----------
<S> <C>
4.1 Form of Common Stock certificate(1)
5.1 Opinion of Troy & Gould Professional Corporation
23.1 Consent of BDO Seidman, LLP
23.2 Consent of Troy & Gould Professional Corporation (contained in
Exhibit 5.1)
24.1 Power of Attorney (contained in Part II of Registration Statement
filed on April 4, 1997)
</TABLE>
_____________
(1) Previously filed as an exhibit to the Company's Form 8-A filed on
October 12, 1989, which exhibit is hereby incorporated herein by
reference.
ITEM 17. UNDERTAKINGS
(a) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Securities Act") may be permitted to directors,
officers and controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the opinion
of the Commission such indemnification is against public policy as expressed in
the Securities Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
(b) The undersigned registrant hereby undertakes that for purposes
of determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(ii)
<PAGE> 18
(c) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made of the securities registered hereby, a post-effective amendment
to this Registration Statement.
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of this Registration Statement (or the
most recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in this
Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in the
registration statement or any material change to such information in the
registration statement;
provided, however, that (i) and (ii) do not apply if the Registration Statement
is on Form S-3, and the information required to be included in a post-effective
amendment is contained in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
(iii)
<PAGE> 19
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Amendment
No. 1 to this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Encino, State of
California, on April 14, 1997.
INDENET, INC.
By /s/ GRAEME R. JENNER
-----------------------------
Graeme R. Jenner,
Chief Executive Officer
<PAGE> 20
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 1 to Registration Statement has been signed by the following
person in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
* Director April 14, 1997
- ------------------------------------------
Thomas H. Baur
* Director April 14, 1997
- ------------------------------------------
William A. Kunkel
* Director April 14, 1997
- ------------------------------------------
Cary S. Fitchey
* Director and Chairman of April 14, 1997
- ------------------------------------------ the Board
Andre A. Blay
* Director and Chief Executive Officer April 14, 1997
- ------------------------------------------
Graeme R. Jenner
* Director April 14, 1997
- ------------------------------------------
Richard L. Schleufer
/s/ Richard J. Parent Chief Financial Officer and Secretary April 14, 1997
- ------------------------------------------ (Principal Financial
Richard J. Parent and Accounting Officer)
</TABLE>
- ---------------
* Executed on behalf of such person by Mr. Graeme R. Jenner pursuant to the
power of attorney granted to Mr. Jenner in the Registration Statement filed
on April 4, 1997.
<PAGE> 21
EXHIBIT INDEX
The following exhibits, which are furnished with this Registration
Statement or incorporated by reference, are filed as part of this Registration
Statement:
<TABLE>
<CAPTION>
Exhibit
No. Description
--- -----------
<S> <C>
4.1 Form of Common Stock certificate(1)
5.1 Opinion of Troy & Gould Professional Corporation
23.1 Consent of BDO Seidman, LLP
23.2 Consent of Troy & Gould Professional Corporation (contained in Exhibit 5.1)
24.1 Power of Attorney (contained in Part II of Registration Statement
filed on April 4, 1997)
</TABLE>
______________
(1) Previously filed as an exhibit to the Company's Form 8-A filed on
October 12, 1989, which exhibit is hereby incorporated herein by
reference.
<PAGE> 1
EXHIBIT 5.1
April 14, 1997
IND 7.2
IndeNet, Inc.
16000 Ventura Boulevard, Suite 700
Encino, California 91436
Gentlemen:
We have acted as counsel for IndeNet, Inc. (the "Company") in connection
with the preparation and filing with the Securities and Exchange Commission
under the Securities Act of 1933, as amended, of a Registration Statement on
Form S-3, as amended (the "Registration Statement"). The Registration Statement
relates to the offer and sale by the selling securityholders named therein (the
"Selling Securityholders") of up to 11,492,364 shares (collectively, the
"Shares") of Common Stock, $.001 par value, of the Company.
In acting as counsel to the Company, we have examined originals or
copies, certified to our satisfaction, of such documents, corporate records and
other instruments as we have deemed necessary, and we are familiar with the
proceedings heretofore taken by the Company in connection with the
authorization, issue and sale by the Company to the Selling Securityholders of
the Shares and certain convertible preferred stock and warrants of the Company.
In addition, we have examined such books and records of the Company as in our
judgment are necessary or appropriate to enable us to render the opinions
expressed below.
Based upon the foregoing, it is our opinion that the Shares are, or
when issued upon conversion of such convertible preferred stock or upon
exercise of such warrants will be, legally and validly issued, fully paid and
nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and the use of our name in the
1.
<PAGE> 2
April 14, 1997
Page 2
Registration Statement and Prospectus of the Company made part thereof. By
giving you this opinion and consent, we do not admit that we are experts with
respect to any part of the Registration Statement or Prospectus within the
meaning of the term "expert" as used in Section 11 of the Securities Act of
1933, as amended, or the rules and regulations promulgated thereunder, nor do we
admit that we are in the category of persons whose consent is required under
Section 7 of said Act.
Very truly yours,
/s/ TROY & GOULD
TROY & GOULD
Professional Corporation
2.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and Board of Directors of IndeNet, Inc.:
We consent to the use of our report incorporated herein by reference and to the
reference of our firm under the heading "Experts" in the Prospectus.
/s/ BDO Seidman, LLP
BDO Seidman, LLP
Los Angeles, California
April 14, 1997
