As filed with the Securities and Exchange Commission on April 21, 1999
Registration No. 333-67741
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
PRE-EFFECTIVE
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
TELIDENT, INC.
(Exact name of registrant as specified in its charter)
MINNESOTA 3661 41-1533060
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification
Number)
TEN SECOND STREET N.E., SUITE 212
MINNEAPOLIS, MN 55413
(612) 623-0911
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
W. EDWARD MCCONAGHAY
TELIDENT, INC.
TEN SECOND STREET N.E., SUITE 212
MINNEAPOLIS, MN 55413
(612) 623-0911
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
COPIES TO:
BRIAN D. WENGER, ESQ.
BRETT D. ANDERSON, ESQ.
DAVID H. MASON, ESQ.
BRIGGS AND MORGAN, P.A.
2400 IDS CENTER
MINNEAPOLIS, MINNESOTA 55402
(612) 334-8400
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT AS DETERMINED BY
MARKET CONDITIONS.
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If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: |_|
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box: |X|
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering: |_|
If this form is a post effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering: |_|
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box: |_|
--------------------------
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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<PAGE>
The information contained in this prospectus is not complete and may be amended.
These securities may not be sold until the related registration statement filed
with the SEC or any applicable state securities commission becomes effective.
This prospectus is not an offer to sell nor is it seeking an offer to buy any
securities in any state where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED APRIL 21, 1999
PROSPECTUS
- --------------------------------------------------------------------------------
3,319,038 SHARES
TELIDENT, INC.
COMMON STOCK
- --------------------------------------------------------------------------------
The shareholders of Telident identified on page 11 are offering and
selling 3,319,038 shares of common stock under this prospectus. We will not
receive any part of the proceeds from this offering.
Our common stock is quoted on the Nasdaq SmallCap Market and trades
under the ticker symbol "TLDT." On April 16, 1999, the closing price of one
share of our stock on the Nasdaq SmallCap Market was $1.875.
---------------
NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR
DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
---------------
THE SHARES INVOLVE RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE 4.
---------------
THE DATE OF THIS PROSPECTUS IS ____________, 1999
<PAGE>
PROSPECTUS SUMMARY
BECAUSE THIS IS A SUMMARY, IT DOES NOT CONTAIN ALL THE INFORMATION THAT
MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS CAREFULLY BEFORE
YOU DECIDE TO INVEST.
TELIDENT
We design, manufacture and market hardware and software systems which
provide the exact location of a 911 telephone call to the emergency dispatcher
at the 911 public safety answering point who receives the call. Our systems
provide information which can speed the response time to a 911 call, reduce the
costs associated with responses to incorrect locations and improve the safety of
individuals within private businesses and public institutions that own or
operate private telephone systems. We also manufacture and market systems that
direct emergency calls to the correct 911 response center and which are used to
create emergency networks for public and private telephone networks and
governmental agencies.
Our products utilize existing enhanced 911 network technology which
automatically transmits the caller's telephone number and address to the nearest
emergency dispatcher. Over two-thirds of the telephone systems in the United
States have access to this enhanced technology. Despite this level of access,
generally only residential telephones connected to the public telephone company
are able to take advantage of this enhanced technology. Private telephone
systems, such as those used by private businesses and public institutions,
generally do not have the ability to send a caller's location to an emergency
911 dispatcher without equipment such as ours. Our products work with enhanced
technology to transmit the precise location, and generally the caller's name, to
the nearest emergency dispatcher through the existing enhanced public network.
Six states have adopted legislation mandating the modification of certain
private telephone systems to make them fully compatible with existing 911
technology. We believe other states are considering such legislation.
The primary markets for our systems and services include a wide variety
of private telephone system owners such as:
* Medium to large corporations * Apartments and condominiums
* Colleges and universities * Nursing and retirement homes
* City, county and state government * Hotels and motels
offices
* Public schools * Hospitals and clinics
OUR BUSINESS STRATEGIES
We have implemented strategies to grow our core business. Such plans
include extending our current products to include additional features and
adapting our hardware and software to take advantage of the information
networking capabilities of sophisticated private data networks and the Internet.
We have also created a special board committee and hired an investment banking
firm to explore our strategic options, including selling Telident or acquiring
another company. There can be no assurance that we will consummate any such
transaction or that any such transaction, if consummated, will ultimately be
advantageous or profitable for us.
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<PAGE>
THE OFFERING
We issued the securities covered by this prospectus to the selling
shareholders primarily in connection with stock purchase agreements between us
and the selling shareholders. The selling shareholders currently hold about 40%
of the shares covered by this prospectus and will receive the other 60% upon the
conversion of preferred stock and the exercise of warrants. The precise number
of shares of common stock which the selling shareholders will receive upon
conversion of preferred stock cannot be determined at this time. Accordingly,
the actual number of shares issued may be higher or lower than the number of
common shares underlying preferred stock registered hereby.
The selling shareholders may offer their shares through public or
private transactions, on or off the Nasdaq SmallCap Market, at prevailing market
prices or privately negotiated prices. No period of time has been fixed within
which the shares may be offered or sold.
GENERAL
Our principal executive offices are located at Ten Second Street, N.E.,
Suite 212, Minneapolis, Minnesota 55413, and our telephone number is (612)
623-0911.
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<PAGE>
RISK FACTORS
BEFORE YOU INVEST IN OUR COMMON STOCK, YOU SHOULD BE AWARE THAT THERE
ARE VARIOUS RISKS, INCLUDING THOSE DESCRIBED BELOW. YOU SHOULD CONSIDER
CAREFULLY THESE RISK FACTORS, AND THE OTHER INFORMATION INCLUDED IN THIS
PROSPECTUS BEFORE YOU DECIDE TO PURCHASE SHARES OF OUR COMMON STOCK.
TELIDENT MAY NOT OPERATE PROFITABLY IN THE FUTURE AND MAY NOT BE ABLE
TO CONTINUE IN BUSINESS UNLESS LONG-TERM TRENDS CHANGE. Except for the last
three quarters, we have historically incurred losses from operations because we
have not sold enough products to cover our expenses. We had an accumulated
deficit of approximately $13.6 million as of December 31, 1998. Net losses
applicable to our common stock including deemed dividends for the years ended
June 30, 1998 and 1997, were approximately $1.1 million and $3.8 million,
respectively. We cannot assure you that we will be able to operate profitably in
the future. We cannot assure you that we will be able to continue in business
unless long-term trends change.
PREFERRED STOCK CONVERSIONS, WARRANT EXERCISES AND OPTION EXERCISES
WILL SUBSTANTIALLY DILUTE TELIDENT'S SHAREHOLDERS. In general, the 400,000
outstanding shares of Series III convertible preferred stock are convertible at
a floating rate that may be substantially below the market price of the common
stock. Based on a 10-day average closing price for the period ending April 16,
1999, each share of this series was convertible into approximately 1.77 common
shares. Pursuant to a modification agreement with Special Situations, one of the
two preferred stock holders, Special Situations is entitled to convert each
preferred share, during a limited period of time, into approximately 3.18 common
shares. The lower the common stock price at the time of conversion, the more
common shares FAMCO and Special Situations get. Due to the conversion formula
applicable to this series, there is no limit on the number of common shares into
which shares of this series can be converted:
* To the extent FAMCO and Special Situations convert preferred
shares and then sell common stock, the common stock price may
decrease due to the additional shares in the market. This
could allow FAMCO and Special Situations to convert preferred
shares into a greater amount of common stock, the sales of
which would further decrease the price of the common stock.
* The significant downward pressure on the price of the common
stock as FAMCO and Special Situations convert and sell
material amounts of common stock could encourage short sales
by FAMCO, Special Situations or others. This could place
further downward pressure on the price of the common stock.
* The conversion of preferred shares may result in substantial
dilution to the interests of other holders of common stock
since FAMCO and Special Situations may ultimately convert and
sell the full amount issuable upon conversion.
As of April 16, 1999, there were 3,027,657 shares of common stock
outstanding. There were warrants outstanding to purchase 1,084,907 shares of
common stock and options outstanding to purchase 93,519 shares of common stock.
As noted above, there were also 400,000 shares of Series III convertible
preferred stock outstanding. While the preferred shares convert at a floating
rate, each outstanding warrant is exercisable for one common share. If Telident
issues new securities at a price less than $2.50 per share, the antidilution
provisions of the preferred shares and the warrants would cause Telident to
issue a greater number of common shares upon their conversion/exercise based
upon such trigger price.
Based on the 10-day average closing price presented above and assuming
full conversion of the preferred stock and the exercise of all outstanding
warrants and options, Telident would have issued approximately 2,168,475 shares
of common stock. Such shares would have represented approximately 71.6% of our
issued and outstanding common stock on that date.
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The following chart depicts the number of common shares we would be
required to issue upon full conversion of the outstanding preferred stock and
the exercise of all outstanding warrants and options, including those which have
exercise prices higher than the current market price. It is worthwhile to note
that, depending upon the 10-day average closing price at the time of conversion,
Telident's average daily trading volume may prevent Special Situations from
converting its preferred stock into the numbers of common shares presented in
the following chart. See "Selling Shareholders - Preferred stock conversion
terms."
<TABLE>
<CAPTION>
10-Day Percentage Common
Average Above or Shares Common Shares Issuable Percentage of
Common Below Preferred Stock Issuable Upon Conversion of Total Out-standing Resulting Common Shares
Stock Price Recent 10- Conversion Ratio Upon Preferred Stock Common Stock Beneficially Owned By
at Time of Day Average ------------------- Exercise of ---------------------- Newly Issued -----------------------
Conversion Common Special Warrants Special Shares Would Special
or Exercise Stock Price FAMCO Situations and Options FAMCO Situations Represent FAMCO Situations
- ----------- ------------ ----- ---------- ----------- ------- ----------- ---------------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$0.708 -60% 4.414 4.414 1,178,426 882,768 882,768 97.2% 2,499,864 1,082,768
$1.062 -40% 2.943 3.185 1,178,426 588,512 636,942 79.4% 2,205,608 836,942
$1.416 -20% 2.207 3.185 1,178,426 441,384 636,942 74.5% 2,058,480 836,942
$1.770 No Change 1.766 3.185 1,178,426 353,107 636,942 71.6% 1,970,203 836,942
$2.124 +20% 1.471 3.185 1,178,426 294,256 636,942 69.7% 1,911,352 836,942
$2.478 +40% 1.261 3.185 1,178,426 252,220 636,942 68.3% 1,869,316 836,942
$2.832 +60% 1.103 3.185 1,178,426 200,000 636,942 66.6% 1,817,096 836,942
</TABLE>
TELIDENT MAY BE UNABLE TO SELL ITSELF OR ACQUIRE ANOTHER COMPANY. We
are exploring strategic options, including selling Telident or acquiring another
company. These options are designed to increase the size and capability of
Telident, to spread the cost of our existing infrastructure, and to increase
shareholder value. We do not have any understandings, commitments or agreements
with respect to any such transactions. There can be no assurance that we will
consummate any such transaction or that any such transaction, if consummated,
will ultimately be advantageous or profitable for us.
TELIDENT MAY REQUIRE ADDITIONAL CAPITAL TO MAINTAIN ITS NASDAQ LISTING
OR TO ACQUIRE ANOTHER COMPANY. At December 31, 1998, we had approximately $1.3
million in cash and $2.3 million in net tangible assets. We believe that the
proceeds from our August 1998 private placement and the cash received from
future operations will enable us to meet the working capital requirements of our
current operating plan and to sustain our business as a going concern at least
through December 31, 1999. However, should we incur additional operating losses
in the future, we may require additional capital to meet Nasdaq's $2.0 million
net tangible asset requirement for continued listing on the Nasdaq SmallCap
Market. If additional capital is not available in these circumstances, we could
lose our listing on the Nasdaq SmallCap Market. The availability of capital may
also impact our ability to consummate a future acquisition of another company.
Additional capital may not be available on terms acceptable to us or at all.
NASDAQ MAY DELIST TELIDENT'S SHARES FOR OTHER REASONS. Telident barely
exceeds the minimum standards for continued listing on the Nasdaq SmallCap
Market. The Nasdaq Stock Market may also decide that our past issuances of
securities violated Nasdaq's corporate governance requirements. In either case,
our shares could be delisted. If our shares do not continue to be listed on the
Nasdaq SmallCap Market, trading, if any, would be conducted in the
over-the-counter market in the so-called "pink sheets" or the OTC Bulletin
Board, which was established for securities that do not meet the Nasdaq SmallCap
Market listing requirements. Consequently, selling our shares would be more
difficult because smaller quantities of shares could be bought and sold,
transactions could be delayed, and security analyst and news media coverage of
Telident may be reduced. These factors could result in lower prices and larger
spreads in the bid and ask prices for our shares. There can be no assurance that
our common stock will continue to be listed on the Nasdaq SmallCap Market.
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TELIDENT'S RESTRUCTURING MAY NOT LEAD TO PROFITABILITY. We have focused
on strengthening our market position, reducing our costs and examining ways to
grow and be profitable. Such efforts have included reducing operating expenses,
cutting our workforce and repositioning our sales force. These steps may not
lead to increased revenue, improved market position or profitability. If these
measures and other reorganization efforts prove unsuccessful, our business,
operating results and financial condition could be materially adversely affected
and we may be unable to achieve the strategic objectives described above.
TELIDENT MAY BE UNABLE TO INTRODUCE NEW OR IMPROVED PRODUCTS ON A
TIMELY BASIS. We participate in an industry in which significant changes and new
and better products are rapidly introduced. To keep up with the industry changes
and product development, we must make substantial investments in product and
technology developments. We are currently investing in hardware and software
upgrades to increase our product capabilities and to take advantage of improving
microprocessor and software capabilities available on the market. However, if
existing technical standards change more rapidly than we anticipate or if our
plans for operating within changing technical standards prove unworkable, our
products may not meet a competitive market's needs or timing and may not meet
necessary regulatory requirements. Furthermore, we may not have the funds
required to continue these developments or to make additional investments on a
timely basis in the future.
TELIDENT'S DEVELOPMENT AND PROFITABILITY DEPEND ON W. EDWARD MCCONAGHAY
AND OTHERS. We believe that our development and ability to operate profitably
depends on the continued employment of our senior management team. If W. Edward
McConaghay, the President and Chief Executive Officer, who Telident has employed
since April 1997, or other members of the management team do not continue to
serve in their present positions, our business, operating results, financial
condition, and cash flows could be materially adversely affected. We have not
entered into non-competition or employment agreements with our employees. As a
result, our employees could leave at any time and compete against us in our
industry. Further, we do not maintain life insurance on any of our employees.
COMPETITION IN 911 TRANSLATION MAY PREVENT TELIDENT FROM GETTING OR
KEEPING CUSTOMERS. We face increasing competition from other companies that
market products similar to our station translation system product. We are aware
of two competitors which market similar products. In addition, several other
competitors provide a basic 911 translation capability through hardware and
software used in connection with private telephone systems. Many of our
potential competitors are larger and have greater resources than we do. In
addition, the technology used in the telecommunications industry is subject to
rapid change. We must be able to adapt to such changes by our competitors or our
products will become obsolete. There can be no assurance that we will be able to
adapt to such changes on a timely basis, if at all. Our competitors continually
take steps to attract customers and increase their market share. The most
heavily used techniques are advertising, target marketing and price competition.
These competitive practices, as well as competition that may develop in the
future, could diminish our ability to obtain and keep customers.
THE MARKETPLACE MAY NOT ACCEPT 911 TRANSLATION PRODUCTS. There can be
no assurance that additional states or the FCC will mandate the modification of
certain private telephone systems to make them fully compatible with existing
911 technology. In the absence of such mandates, there can be no assurance that
our products will maintain their current level of acceptance.
TELEPHONE COMPANIES MAY NOT COOPERATE WITH TELIDENT. The attractiveness
of our products to the public depends, in part, on the tariffs filed by local or
regional telephone companies. We depend, and our customers depend, upon the
cooperation of local telephone companies for the installation and operation of
our products. If the pricing for network interfaces or database access provided
by telephone companies is not favorable to our products, or if telephone
companies are uncooperative, our sales in the affected market may drop.
We presently are experiencing delays with Ameritech, the telephone
company for Illinois, Michigan, Ohio, Indiana and Wisconsin. We believe that
other telephone equipment manufacturers and related service
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providers are having similar difficulties with Ameritech. We have installed and
continue to install working systems in these states; however, we can experience
120-150 day delays by Ameritech in the installation of requested network
interfaces throughout this territory. Although the delays have not had a
material adverse effect on our business, we are exploring ways to improve our
relationship with Ameritech so that completion of projects for our customers are
not unduly delayed. There can be no assurance that we will be successful in
these endeavors.
TELIDENT'S ANALOG PRODUCTS WILL BECOME OBSOLETE; TELIDENT WILL BE
REQUIRED TO DEVELOP DIGITAL SOFTWARE INTERFACES. Several telephone companies
have expressed a preference to sell digital equipment to customers within their
territories instead of the current standard analog interface offered by
Telident. We are currently preparing for a change to the use of digital
interfaces connecting our products to private telephone systems. We are in the
early stages of developing interfaces so that our software will work with
digital equipment, we believe that we have the technical ability to develop such
interfaces and we estimate that such development will cost $20,000 to $30,000.
We intend that our software applications will operate with digital equipment
independent of the type of interface and independent of the hardware vendor.
TELIDENT'S STOCK PRICE MAY BE VOLATILE. The market price of our common
stock has fluctuated significantly in recent months in response to numerous
factors. Variations in our financial results, changes by financial research
analysts in their estimates of our earnings, conditions in the economy in
general or in our industry in particular, unfavorable publicity or changes in
applicable laws and regulations affecting us may cause such fluctuations. In the
first three months of trading in 1999, our stock ranged from a high of $7.00 per
share on January 12 to a low of $1.06 per share on March 19 and 22. There can be
no assurance that purchasers of our stock can sell such stock at or above the
prices at which it was purchased.
TELIDENT MAY BE LIABLE FOR DELAYED RESPONSES TO 911 CALLS. We may be
liable if, through the failure of any of our products, any such products
contribute to a delayed response from a 911 call resulting in injury, illness or
death. While our products are designed to complete 911 calls even if they fail
to provide number and location detail, there can be no assurance that this
feature will always work as expected. We carry product liability insurance, but
this insurance may not be adequate to cover successful product liability claims.
We know of no product liability claims against us and we know of no product
liability claims brought against our competitors. However, a successful product
liability suit could materially adversely affect our business, operating
results, financial condition and cash flows.
TELIDENT MAY BE UNABLE TO PROTECT ITS INTELLECTUAL PROPERTY. We rely
upon trade secrets and patents to protect the technology we develop. We also
require our employees to execute nondisclosure agreements to preserve our trade
secrets. It is important for our success to preserve our intellectual property.
Our competitors may develop or acquire substantially equivalent technologies or
gain access to our trade secrets. We may not be able to protect our rights in
our trade secrets and our attempts to do so may not provide us with a
competitive advantage.
THE SALE OF TELIDENT'S STOCK MAY CAUSE THE MARKET PRICE OF TELIDENT'S
STOCK TO FALL. The market price of our common stock could drop as a result of a
large number of shares of common stock being sold in the market following resale
registrations, the exercise of warrants and options, the conversion of
convertible securities, or the perception that such sales could occur. These
factors could also make it more difficult for us to raise funds through future
equity offerings.
TELIDENT'S LOW STOCK PRICE MAY PRESENT LIQUIDITY PROBLEMS FOR
SHAREHOLDERS. If our shares are not listed on the Nasdaq SmallCap Market, a
broker-dealer trading our shares may need to make a special suitability
determination for a purchaser and receive a purchaser's written consent to a
transaction prior to sale. If our shares are delisted from Nasdaq and we fail to
meet other financial criteria, the SEC may apply "penny stock" restrictions to
our shares. In either case, the market liquidity for our shares would be
adversely affected.
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DIRECTORS EFFECTIVELY CONTROL TELIDENT. Our current directors
beneficially own over half of our common stock. Accordingly, such persons may
control the outcome of shareholder approvals of business acquisitions, mergers
and combinations and other actions. Even if other shareholders sought to
discontinue operations and liquidate Telident, our current directors could
prevent Telident from taking such actions.
YEAR 2000 COMPLIANCE ISSUES MAY NEGATIVELY AFFECT TELIDENT. Many
currently installed computer systems and software products, which are currently
coded to accept only two digit date entries, will need to accept four digit date
entries to distinguish 21st century dates from 20th century dates. As a result,
in less than one year, computer systems and software used by many companies may
need to be upgraded to comply with such "Year 2000" requirements. The failure of
our products, our vendors or our customers to achieve Year 2000 compliance on a
timely basis could materially adversely affect our business, operating results,
financial condition and cash flows.
State of readiness. We are presently completing the assessment of our
Year 2000 readiness for operations, focusing on critical operating and
applications systems, particularly the Year 2000 compliance of:
* our hardware and software products
* our internal administrative systems, and
* the compliance of our key software/hardware vendors.
We believe that all Telident products currently manufactured and
marketed are Year 2000 compliant. None of our current products rely on a date to
function properly. To the extent that our products process dates, they use four
digit years and are not subject to the effects of Year 2000. We communicate
these facts, and specific product compliance, non-compliance and upgrade
options, to our customers through our Internet web page and routine sales and
marketing communications activities.
As a part of our Year 2000 assessment, we simulated the event by
inserting key dates leading up to and beyond the Year 2000 in an orchestrated
manner for our key infrastructure components, critical business processes and
key applications systems. We expect that minor Year 2000 compliance issues will
continue to be identified as an outcome of these Year 2000 simulation tests and
we intend to address these compliance issues no later than the second quarter of
calendar 1999.
Telident's internal accounting software is not Year 2000 compliant;
however, we have already purchased Year 2000 compliant accounting software and
we plan to roll over our accounting operations to utilize the new software in
1999. Our internal telecommunications and data processing systems have all been
brought into compliance.
We are currently performing a compliance survey of our critical
vendors. Our key computer and software application suppliers are Year 2000
compliant, or we know their plans to become so. We have requested and will
review our building operator's and utility vendors' plans for becoming Year 2000
compliant.
Costs to address Year 2000 issues. We intend to complete our Year 2000
remediation efforts primarily with in-house resources, but will utilize
consultants should the need arise. In the aggregate, we have spent an estimated
$20,000 and anticipate spending an additional $15,000 as part of our Year 2000
assessment and remediation. The additional $15,000 includes the estimated $3,000
to $5,000 cost of rolling over our accounting operations to utilize new software
that is Year 2000 compliant.
Risks of Year 2000 issues. We recognize that issues related to Year
2000 constitute a material known uncertainty. We also recognize the importance
of ensuring that Year 2000 issues will not adversely affect our operations. We
believe that the processes described above will be effective to manage the risks
associated with the problem. However, there can be no assurance that the
processes can be completed on the timetable described above or that remediation
will be fully effective. The failure to identify and remediate Year 2000
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issues, or the failure of customers, key vendors or other critical third parties
who do business with us to timely remediate their Year 2000 issues could cause
system failures or errors, business interruptions and, in a worst case scenario,
the inability to engage in normal business practices for an unknown length of
time. Our business, operating results, financial condition and cash flows could
be materially adversely affected. At this time, however, Telident does not
possess information necessary to estimate the overall potential financial impact
of Year 2000 compliance issues. Specific risks we face with regard to Year 2000
issues include the following:
1. Decreased sales. Although we have tested and believe that our
current products are Year 2000 compliant, we believe that the purchasing
patterns of customers and potential customers may be affected as they direct a
significant portion of their scarce information technology resources to complete
their Year 2000 compliance programs. These expenditures may result in reduced
funds available to purchase 911 hardware and software products such as ours.
This could result in a material adverse effect on our business, operating
results, financial condition and cash flows.
2. Customer litigation. We have developed a program to advise our
customers of the Year 2000 compliance status of our products and we have
identified upgrade and replacement products for our customers potentially
affected by Year 2000 issues. Although we believe that our efforts will ensure
no disruption in the business or operations of our customers, the possibility
exists that some customers may experience problems that may motivate them to sue
us for restitution and damages that may be related to such problems.
3. Disruption of supply materials. Several months ago, we began an
ongoing process of surveying our vendors with regard to their Year 2000
readiness and we are now in the process of assessing and cataloging the first
responses to the survey. We are hopeful of receiving adequate responses from
critical vendors and many non-critical vendors by the second calendar quarter of
1999. We presently expect to work with vendors that show a need for assistance
or that provide inadequate responses, and in many cases expect that survey
results will be refined significantly by such work. Where ultimate survey
results show that the need arises, we will arrange for back-up vendors before
the change-over date.
4. Disruption of internal computer systems. Telident has simulated the
Year 2000 event by inserting key dates leading up to and beyond the Year 2000 in
an orchestrated manner for our key infrastructure components, critical business
processes and key applications systems. We believe that disruption of our
internal computer systems is unlikely; however, we expect that minor Year 2000
compliance issues will continue to be identified as an outcome of these Year
2000 simulation tests. We intend to address these compliance issues no later
than the second quarter of calendar 1999.
5. Disruption of non-computer systems. We are currently conducting a
comprehensive assessment of all non-computer systems, including utility,
telecommunications, delivery and other services. Although we intend to work with
any third party providers of such services to ensure that there will be no
disruption in our operations, we believe that if any disruptions do occur, such
will be dealt with promptly and will be no more severe with respect to
correction or impact than would be an unexpected breakdown of such services and
related equipment.
Contingency plans. We recognize the need for Year 2000 contingency
plans in the event that remediation is not fully successful or that the
remediation efforts of our vendors, suppliers and governmental/regulatory
agencies are not timely completed. We intend to address contingency planning
during calendar 1999.
If key parts suppliers or contract manufacturers do not achieve Year
2000 compliance in a timely manner, or at all, we believe that we have
identified alternative sources that will meet our business or operations
requirements. Additionally, we plan to create sufficient reserves of finished
goods inventory, such that any delay in changing vendors will have a minimal
effect on our business, operating results, financial condition and cash flows.
9
<PAGE>
SPECIAL NOTE REGARDING TELIDENT'S FORWARD-LOOKING STATEMENTS
Some of the information in this document may contain forward-looking
statements. You can identify such statements by noting the use of
forward-looking terms such as "believes," "expects," "plans," "estimates" and
other similar words. Risks, uncertainties or assumptions that are difficult to
predict may affect such statements. The risk factors presented above and other
cautionary statements could cause our actual operating results to differ
materially from those expressed in any forward-looking statement. We caution you
to keep in mind these risk factors and other cautionary statements and to
refrain from placing undue reliance on any forward-looking statements, which
speak only as of the date of this document.
10
<PAGE>
SELLING SHAREHOLDERS
The following table presents information regarding the selling
shareholders. The shares listed below represent the shares that each selling
shareholder owned on April 16, 1999, or which each selling shareholder may own,
upon the conversion of preferred stock or the exercise of warrants.
The securities "beneficially owned" by a person are determined in
accordance with the SEC's definition of "beneficial ownership" and, accordingly,
may include securities owned by or for, among others, the spouse, children or
other relatives of such person, as well as other securities over which the
person has or shares voting or investment power or securities which the person
has the right to acquire within 60 days of April 16, 1999.
In the following chart, percentage of beneficial ownership is based on
3,027,657 outstanding shares of common stock. Shares issuable pursuant to the
conversion of preferred stock and the exercise of warrants and options are
deemed outstanding for computing the percentage of the person holding such
securities but are not deemed outstanding for computing the percentage of any
other person. The number of shares purchasable pursuant to the conversion of
preferred stock assumes a 10-day average closing bid price of $1.00 per common
share. We have used this price because $1.00 represents the minimum bid price
required for continued listing on the Nasdaq SmallCap Market. See "- Preferred
stock conversion terms."
<TABLE>
<CAPTION>
PERCENTAGE OF
SHARES OUTSTANDING SHARES
BENEFICIALLY SHARES BENEFICIALLY
OWNED BENEFICIALLY OWNED IF ALL
BEFORE OWNED BEFORE SHARES SHARES ARE SOLD
SELLING SHAREHOLDER OFFERING OFFERING OFFERED IN THE OFFERING
- ----------------------------------------- ------------ ------------- --------- ---------------
<S> <C> <C> <C> <C>
FAMCO III, Limited Liability Company(1) 2,242,096 53.2% 2,242,096 0
Interchange Tower, Suite 850
600 S. Highway 169
Minneapolis, MN 55426
Special Situations Private Equity Fund, L.P.(2) 836,942 21.7% 836,942 0
153 East 53rd Street
New York, NY 10022
Willis Drake(3) 164,630 5.4% 80,000 84,630
5704 Schaefer Road
Edina, MN 55436
Warren Tyler Estate(4) 115,937 3.8% 80,000 35,937
c/o/ Steven Tyler
125 Walker Street
Wayzata, MN 55391
Richard Hencley(5) 107,374 3.5% 80,000 27,374
1424 Indian Oaks Court
Arden Hills, MN 55112
</TABLE>
- ---------------
(1) Represents 625,000 shares purchasable pursuant to the conversion of
200,000 shares of Series III convertible preferred stock, 564,907
shares purchasable pursuant to the exercise of warrants and 1,052,189
shares of common stock. John Wunsch and Greg Nelson are the natural
persons who exercise control over FAMCO.
(2) Represents 636,942 shares purchasable pursuant to the conversion of
200,000 shares of Series III convertible preferred stock and 200,000
shares purchasable pursuant to the exercise of warrants. Austin Marxe
and David Greenhouse are the natural persons who exercise control over
Special Situations.
11
<PAGE>
(3) Includes 2,702 shares purchasable pursuant to the exercise of options
and 14,625 shares purchasable pursuant to the exercise of warrants.
(4) Steven Tyler is the natural person who exercises control over the
Warren Tyler Estate.
(5) Includes 3,750 shares of common stock which Mr. Hencley owns jointly
with his spouse.
SALES TO SELLING SHAREHOLDERS
In April 1998, Telident entered into a securities purchase agreement
with FAMCO and Special Situations pursuant to which FAMCO and Special Situations
each purchased 200,000 shares of Series III convertible preferred stock and
warrants to purchase 200,000 shares of common stock. Family Financial
Strategies, Inc. is the manager of FAMCO. John Wunsch and Greg Nelson are the
sole officers and directors of Family Financial Strategies, Inc. Mr. Wunsch has
also been a director of Telident since July 1997. MG Advisers, L.L.C. acts as
general partner of and investment adviser to Special Situations. Austin W. Marxe
and David Greenhouse are the sole members of MG Advisers.
In June 1994, Telident sold 62,500 shares of Series I convertible
preferred stock for an aggregate consideration of $1,000,000 in a private
transaction. In this transaction, Willis Drake, Richard Hencley and Warren
Tyler each purchased one-third of the shares sold. All three individuals were
directors of Telident at the time of purchase and Mr. Drake continues to serve
as a director of Telident. In March 1999, Willis Drake, Richard Hencley and
Warren Tyler's Estate each converted their remaining 12,500 shares of Series I
convertible preferred stock into 80,000 shares of common stock at the fixed
conversion ratio of 6.4 common shares per preferred share. As a consequence, the
Series I convertible preferred stock has been completely converted to common
shares. Steven Tyler is the natural person who exercises control over the Warren
Tyler Estate.
PREFERRED STOCK CONVERSION TERMS
In general, the 400,000 outstanding shares of Series III convertible
preferred stock are convertible at a floating rate which depends on the 10-day
average closing bid price of the common stock at the time of conversion. The
following conversion formula applies to the preferred stock:
$2.50
--------------------------------------------
The lesser of (a) $2.50 or (b) if the 10-day
average closing bid price of the common
stock is less than $2.50, then 80% of such
average price
The preferred stock also contains antidilution rights which provide
that the number of shares issuable upon conversion will be increased if Telident
issues new securities at a price less than $2.50 per share.
Based on a 10-day average closing price for the period ending April 16,
1999, FAMCO and Special Situations would have been entitled to convert each
share of their preferred stock into approximately 1.77 common shares.
Pursuant to a modification agreement, Telident amended the conversion
terms that apply to Special Situations, the owner of 200,000 shares of preferred
stock. The modification agreement only applies to those shares of common stock
which Special Situations receives upon conversion and sells between:
* the effect date of the registration statement which registers
such shares and
* the last date that the closing bid price of the common shares
exceeds $1.75 for a period of 10 consecutive trading days.
12
<PAGE>
During this special conversion period, the phrase "80% of such average
price" in the conversion formula shall not exceed $0.785. In other words, as to
those shares which Special Situations is able to sell during the special
conversion period, the conversion rate will be approximately 3.18 shares of
common stock, as opposed to approximately 1.77 shares of common stock which
would otherwise be received upon conversion, for each share of preferred stock.
Depending upon the 10-day average closing price at the time of conversion,
Telident's average daily trading volume may prevent Special Situations from
converting all of its preferred stock during the special conversion period. At
the end of the special conversion period, the conversion rate set forth in the
modification agreement will no longer apply to the shares of preferred stock
then owned by Special Situations.
The actual number of common shares issuable upon conversion of the
shares of preferred stock is subject to adjustment depending on factors that
cannot be predicted at this time, such as the future market price of the common
stock.
PREFERRED STOCK DIVIDEND RIGHTS
FAMCO and Special Situations are entitled to dividends if dividends are
paid on the common stock. If dividends are paid on the common stock, a
comparable dividend must be paid on the preferred stock. No cumulative dividends
are currently outstanding on Telident's preferred stock.
TERMS OF THE RELATED WARRANTS
In connection with their purchase of preferred stock, FAMCO and Special
Situations each received warrants to purchase 200,000 shares of common stock.
Such warrants are exercisable at $3.125 per share and they terminate in April
2000. These warrants also contain antidilution rights which provide that the
number of shares issuable upon exercise will be increased if Telident issues new
securities at a price less than $2.50 per share. Telident may call the warrants
if the bid price of the common stock equals or exceeds $4.375 per share for at
least 10 consecutive trading days immediately before the call. Telident may not
call the warrants during any period in which the registration of the shares
underlying the warrants is not effective.
In July 1997, Telident issued 277,778 shares of Series II convertible
preferred stock and warrants to purchase 312,500 shares of common stock to
FAMCO. Although the Series II convertible preferred stock has been completely
converted to common shares, FAMCO still holds the related warrant. This warrant
is exercisable at $4.83 per share and terminates in July 1999. The number of
shares issuable pursuant to this warrant has been adjusted pursuant to
antidilution rights substantially similar to those described above. As of April
16, 1999, such warrant could have been exercised for 364,907 common shares.
Telident may call the warrants if the bid price of the common stock equals or
exceeds $7.88 per share for at least 10 consecutive trading days immediately
before the call.
SELLING SHAREHOLDERS' REGISTRATION RIGHTS
Under our stock purchase agreements with FAMCO and Special Situations,
we agreed to register:
* their shares of common stock,
* shares to be issued to them upon the conversion of their
preferred stock, and
* shares to be issued to them upon the exercise of their
warrants.
We also agreed to use our best efforts to keep the registration
statement effective for three years, until they no longer hold or have the right
to acquire the shares, or until all of their shares may be sold pursuant to SEC
rules without volume restrictions, whichever comes first.
13
<PAGE>
Pursuant to our modification agreement with the former holders of
Series I convertible preferred stock, we agreed to register the shares issued to
them upon the conversion of their preferred stock. We also agreed to use our
best efforts to keep the registration statement effective for two years.
Our registration of the shares does not necessarily mean that the
selling shareholders will sell all or any of the shares covered by this
prospectus.
USE OF PROCEEDS
All of the net proceeds from the sale of the shares will go to the
shareholders who offer and sell their shares. Accordingly, we will not receive
any proceeds from the sale of the shares.
PLAN OF DISTRIBUTION
The selling shareholders may offer their shares at various times in one
or more of the following transactions:
* on the Nasdaq SmallCap Market
* in transactions other than on such market
* in privately negotiated transactions, or
* in a combination of any of the above transactions
The selling shareholders may sell their shares at market prices
prevailing at the time of sale, at prices related to such prices, or at
negotiated prices. We are indemnifying the selling shareholders against
liabilities under the Securities Act.
The selling shareholders may use broker-dealers to sell their shares.
If this happens, broker-dealers will either receive discounts or commissions
from the selling shareholders, or they will receive commissions from purchasers
of shares for whom they acted as agents.
The selling shareholders and any persons who participate in the sale of
the shares from time to time, may be deemed to be "underwriters" within the
meaning of Section 2(a)(11) of the Securities Act. Any commissions paid or
discounts or concessions allowed to any such persons and any profits received on
resale of the shares, may be deemed to be underwriting compensation under the
Securities Act.
In order to comply with applicable state securities laws, the shares
will be sold only through registered or licensed brokers or dealers. In
addition, the shares will not be sold until they have been registered or
qualified for sale in the applicable state or an exemption from the registration
or qualification requirement is available.
LEGAL MATTERS
For the purposes of this offering, Briggs and Morgan, Professional
Association, is giving its opinion on the validity of the shares.
EXPERTS
The financial statements incorporated in this prospectus by reference
from Telident's Annual Report on Form 10-KSB/A for the year ended June 30, 1998
have been audited by Deloitte & Touche LLP, independent auditors, as stated in
their report, which is incorporated herein by reference, and have been so
incorporated in reliance upon the report of such firm given upon their authority
as experts in accounting and auditing.
14
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information
on the public reference rooms. Our SEC filings are also available to the public
from the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to documents we file with the SEC. The information incorporated by
reference is considered to be part of this prospectus. Information that we file
later with the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings we
will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until the selling shareholders sell all of the
shares covered by this prospectus:
* Annual Report on Form 10-KSB/A for the year ended June 30,
1998;
* Quarterly Reports on Form 10-QSB for the quarters ended
September 30, 1998 and December 31, 1998;
* Description of our common stock contained in our Registration
Statement on Form SB-2 (No. 333-04311) filed on May 22, 1996
(as amended);
* Current Reports on Form 8-K filed on August 19, 1998; and
* Definitive Schedule 14A (Proxy Statement) filed on September
29, 1998.
This prospectus is part of a registration statement we filed with the
SEC. You may request a copy of the registration statement or any of the above
filings, at no cost, by writing or telephoning the Chief Executive Officer at
the following address:
Telident, Inc.
Ten Second Street N.E., Suite 212
Minneapolis, Minnesota 55413
(612) 623-0911
You should rely only on the information or representations provided in
this prospectus. We have not authorized anyone else to provide you with
different information. The selling shareholders will not make an offer of these
shares in any state where the offer is not permitted. You should not assume that
the information in this prospectus is accurate as of any date other than the
date on the front of this document.
15
<PAGE>
================================================================================
YOU SHOULD RELY ON THE INFORMATION CONTAINED IN THIS DOCUMENT OR THAT
TO WHICH WE HAVE REFERRED YOU. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
INFORMATION THAT IS DIFFERENT. YOU SHOULD NOT ASSUME THAT THE INFORMATION IN
THIS DOCUMENT IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF
THIS DOCUMENT. THIS PROSPECTUS IS NOT AN OFFER TO SELL NOR IS IT SEEKING AN
OFFER TO BUY ANY SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT
PERMITTED.
-----------------
TABLE OF CONTENTS
-----------------
Page
----
Prospectus Summary........................................................... 2
Risk Factors................................................................. 4
Selling Shareholders......................................................... 11
Use of Proceeds.............................................................. 14
Plan of Distribution......................................................... 14
Legal Matters................................................................ 14
Experts...................................................................... 14
Where You Can Find More Information.......................................... 15
================================================================================
3,319,038 SHARES
TELIDENT, INC.
COMMON STOCK
------------
PROSPECTUS
------------
______________, 1999
================================================================================
<PAGE>
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the various expenses payable by Telident
in connection with the sale and distribution of the shares being registered. All
amounts shown are estimates, except the registration fee.
SEC registration fee......................................... $ 1,027
Legal fees and expenses...................................... 17,500
Accounting fees and expenses................................. 7,500
Blue sky and related fees and expenses....................... 1,000
Miscellaneous (including listing fees, if applicable)........ 22,973
--------
Total................................................... $ 50,000
========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Minnesota Statutes Section 302A.521 provides that a Minnesota business
corporation shall indemnify any director, officer, employee or agent of a
corporation made or threatened to be made a party to a proceeding, by reason of
the former or present official capacity (as defined) of the person, against
judgments, penalties, fines, settlements and reasonable expenses incurred by the
person in connection with the proceeding if certain statutory standards are met.
"Proceeding" means a threatened, pending or completed civil, criminal,
administrative, arbitration or investigative proceeding, including one by or in
the right of a corporation. Section 302A.521 contains detailed terms regarding
such right of indemnification and reference is made thereto for a complete
statement of such indemnification rights.
Article VII of Telident's Restated Articles of Incorporation eliminates
certain personal liability of the directors of Telident for monetary damages for
certain breaches of the directors' fiduciary duties.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
Exhibit
Number Description
- ------ -----------
5.1 Opinion of Briggs and Morgan, Professional Association (previously
filed).
10.1 Stock Purchase Agreement dated April 13, 1998, between Telident
and FAMCO III Limited Liability Company and Special Situations
Private Equity Fund, L.P. (incorporated by reference to the
Registrant's Annual Report on Form 10-KSB filed with the SEC on
August 28, 1998, File No. 000-20887).
10.2 Series I Convertible Preferred Stock Modification Agreement dated
December 29, 1998, between Telident and the holders of Series I
Convertible Preferred Stock (incorporated by reference to the
Registrant's Quarterly Report on Form 10-QSB filed with the SEC on
February 16, 1999, File No. 000-20887).
10.3 Series III Convertible Preferred Stock Modification Agreement
dated December 29, 1998, between Telident and Special Situations
Private Equity Fund, L.P. (incorporated by reference to the
Registrant's Quarterly Report on Form 10-QSB filed with the SEC on
February 16, 1999, File No. 000-20887).
23.1 Consent of Briggs and Morgan, Professional Association (included
in Exhibit 5.1).
23.2 Independent Auditors' Consent (previously filed).
24.1 Power of Attorney (previously filed).
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
II-1
<PAGE>
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
and
(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 the undertakings set forth in paragraphs (i) and (ii)
above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports
filed by the Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new Registration Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling persons of
the Registrant pursuant to the provisions summarized in Item 15 above, or
otherwise, the Registrant has been advised that in the opinion of the SEC such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer, or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer, or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel, the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Minneapolis and State of Minnesota, on April 21,
1999.
TELIDENT, INC.
By /s/ W. Edward McConaghay
-------------------------------------
W. Edward McConaghay
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act, this registration
statement has been signed by the following persons on the dates and in the
capacities indicated.
Signature Title Date
--------- ----- ----
/s/ W. Edward McConaghay President, Chief Executive April 21, 1999
- -------------------------- Officer and Director (Principal
W. Edward McConaghay Executive Officer)
/s/ W. Edward McConaghay Treasurer and Chief Financial April 21, 1999
- -------------------------- Officer (Principal Financial and
W. Edward McConaghay Accounting Officer)
* Chairman of the Board and
- -------------------------- Director
Mark W. Sheffert
* Director
- --------------------------
Scott R. Anderson
* Director
- --------------------------
Willis K. Drake
* Director
- --------------------------
David F. Durenberger
* Director
- --------------------------
John D. Wunsch
* Director
- --------------------------
Mack V. Traynor, III
* By /s/ W. Edward McConaghay April 21, 1999
---------------------------------
W. Edward McConaghay
As Attorney-In-Fact
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------ -----------
5.1 Opinion of Briggs and Morgan, Professional Association (previously
filed).
10.1 Stock Purchase Agreement dated April 13, 1998, between Telident
and FAMCO III Limited Liability Company and Special Situations
Private Equity Fund, L.P. (incorporated by reference to the
Registrant's Annual Report on Form 10-KSB filed with the SEC on
August 28, 1998, File No. 000-20887).
10.2 Series I Convertible Preferred Stock Modification Agreement dated
December 29, 1998, between Telident and the holders of Series I
Convertible Preferred Stock (incorporated by reference to the
Registrant's Quarterly Report on Form 10-QSB filed with the SEC on
February 16, 1999, File No. 000-20887).
10.3 Series III Convertible Preferred Stock Modification Agreement
dated December 29, 1998, between Telident and Special Situations
Private Equity Fund, L.P. (incorporated by reference to the
Registrant's Quarterly Report on Form 10-QSB filed with the SEC on
February 16, 1999, File No. 000-20887).
23.1 Consent of Briggs and Morgan, Professional Association (included
in Exhibit 5.1).
23.2 Independent Auditors' Consent (previously filed).
24.1 Power of Attorney (previously filed).
