ACTV INC /DE/
424B3, 1999-04-09
RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT
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                                                Filed pursuant to Rule 424(b)(3)
                                                          SEC File No. 333-69923
PROSPECTUS




                                   ACTV, INC.

                        9,858,172 Shares of Common Stock

            Shareholders of ACTV, Inc. named under the caption "Selling Security
Holders", from time to time, may offer and sell up to 9,858,172 shares of ACTV
common stock.

            ACTV's common stock is traded on the Nasdaq SmallCap Market under
the symbol "IATV" and on the Boston Stock Exchange under the symbol "IAT". On
April 8, 1999, the last reported sale price of ACTV's common stock on Nasdaq was
$17 7/8.

            An investment in these securities is risky. You should only purchase
these shares if you can afford to lose your entire investment.
See Risk Factors commencing on page 4.

            Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these securities or passed
on the accuracy or adequacy of this prospectus. Any representation to the
contrary is a criminal offense.





                  The date of this prospectus is April 9, 1999


                                       1
<PAGE>

                               PROSPECTUS SUMMARY

            This summary does not contain all of the information that may be
important. You should read the detailed information appearing elsewhere in this
prospectus including the documents incorporated by reference.

The Company

            ACTV has developed proprietary and patented software technologies
that we call Individualized Television and HyperTV(TM). These software
technologies enable the creation of interactive programming for both digital
television and for applications merging television and the Internet.

            ACTV's Individualized Television software technology provides the
tools needed to create live or pre-recorded television programming that
individualizes what the viewer sees and hears. The proprietary software can
remember all of the choices the viewer keys in with his TV remote control,
allowing the television to literally respond to each viewer with tailored
programming and advertising content. Using a standard digital remote control,
television viewers switch channels seamlessly and instantly among multiple,
real-time feeds of live or pre-recorded video, audio and data. Because there is
no observed gap between the viewer's selection and the display on the
television, viewers do not realize that they have changed channels, but perceive
they are watching one channel that is responsive to their choices. In fact,
Individualized Television is a multi-channel telecast of several elements of
related programming material such as instant replay on demand, an isolation
camera on a star player, and statistical data. To receive our individualized
programming a viewer needs a standard digital television set-top box that is
compatible with our Individualized Television software technology.

            The first commercial digital application of Individualized
Television will be a subscription television network that presents regional
sports programming. We plan to launch the network in 1999 in the region served
by Fox Sports Southwest. Fox Sports Southwest distributes programming to more
than 5 million households in Texas, Louisiana, Arkansas, Oklahoma and nine New
Mexico counties. The southwest regional network will feature individualized
telecasts of Houston Rockets, Dallas Mavericks, and San Antonio Spurs
professional basketball games, Dallas Stars professional hockey games, and Texas
Rangers and Houston Astros major league baseball games. Additional programming
will include college sports events from the Southeastern, Southland and Western
Athletic conferences. We have an agreement with Tele-Communications Inc., to
distribute and market our regional network to its digital television subscribers
in Texas.

            ACTV's first national individualized programming will be developed
and managed through a joint venture formed in September 1998 with Liberty Media
Corporation, called LMC IATV Events, LLC. LMC IATV Events, through an exclusive
license from ACTV, has the right to produce and distribute telecasts of major
events incorporating our individualized programming enhancements. As
consideration for granting such a license, ACTV received a fixed one-third
equity interest in the joint venture, with no obligations to make additional
capital contributions.

            HyperTV(TM) software technologies enable the simultaneous delivery
of streamed video and complementary material available on the World Wide Web
directly to personal 


                                       2
<PAGE>

computer users or television viewers. We announced the introduction of
HyperTV(TM) for entertainment applications in March 1999. The first commercial
application of HyperTV(TM) was the on-line education market including K-12
classrooms, universities, distance learning programs, and corporations. The
HyperTV(TM) software products include content creation software, student and
teacher user software, and software for assessing and storing student
performance. We provide clients with Internet content design assistance, the
hosting of educational programs on our computer servers, and technical
consulting. Currently, all of our revenues are derived form sales to the on-line
learning market.

            ACTV was incorporated in Delaware on July 24, 1989. ACTV is the
successor, by merger effective November 1, 1989, to ACTV, Inc., a California
corporation, organized on July 11, 1983. Our executive offices are located at
1270 Avenue of the Americas, New York, New York 10020, telephone number (212)
217-1600.

The Offering

Securities Offered                  9,858,172 shares of common stock

Common Stock Outstanding            33,914,846 shares

Common Stock Market Symbols         Nasdaq SmallCap Market - "IATV"
                                    Boston Stock Exchange - "IAT"

Estimated Net Proceeds              The selling security holders will
                                    receive the net proceeds from the
                                    sale of the shares.  We will
                                    receive none of the proceeds from
                                    the sale of the shares offered by
                                    this prospectus.

Risk Factors                        An investment in the shares
                                    involves a high degree of risk. See
                                    "Risk Factors" commencing on the
                                    next page.


                                       3
<PAGE>

                                  RISK FACTORS

            An investment in ACTV's shares involves a high degree of risk. You
should carefully consider the following risks, in addition to the other
information contained in this prospectus, before deciding to invest in ACTV's
shares.

Risks Related to Our Business

We have had operating losses and limited revenues to date and may not be able to
generate income or significant revenue in the future.

            We have been operating at a loss to date. Losses applicable to
common shareholders for the years ended December 31, 1998, 1997 and 1996 were
$20,868,324, $10,358,683, and $10,300,481, respectively. Through December 31,
1998, we had an accumulated deficit of approximately $71.9 million. We have had
limited revenues. Revenues for the years ended December 31, 1998, 1997 and 1996
were $1,405,838, $1,650,955, and $1,476,329, respectively. We may not be able to
generate significant revenues in the future. Also, we do not expect to achieve
profitability in the foreseeable future.

Our individualized programming products are new to the new digital television
market and may not sell.

            We have not had any sales of our digital individualized programming
service. While we plan to commercialize our individualized programming in
conjunction with Fox Sports Southwest and have conducted certain test marketing,
we have not yet introduced this product on a commercial basis. We can not assure
you that the initial monthly subscription price of $9.95 for our southwest
regional network will be successful. Therefore, the subscription service should
be viewed as a newly introduced product, the demand for, and market acceptance
of which, is uncertain. Our individualized programming may not become
commercially successful, and there may not be sufficient demand and market
acceptance for our products to become profitable.

Sales of our HyperTV(TM) has been limited and may not be accepted by the market.

            We made our first our HyperTV(TM) sale to the on-line education 
market in the second quarter of 1997. We have had only a limited number of
additional sales to this market, which itself is a new, developing market in the
process of evolving. We can not assure you that sales growth in the on-line
education market will lead to profitability. In addition, we are only in the
early planning stages of extending the HyperTV(TM) software technology to
entertainment and corporate applications.

We will need additional financing which will dilute your investment.

            We have required significant capital to develop our Individualized
Television and HyperTVTM technologies, to produce programming, to develop
marketing approaches and strategic alliances, and to cover costs of selling,
general and administrative expenses. We have also from time to time experienced
working capital deficits. To date, we have not generated revenues sufficient to
sustain our operations, and cannot generate such revenues, if at all, without
raising additional funds to implement our business plan. We have issued debt to
raise funds for the development of the southwest regional network; however, we
are not yet delivering our 


                                       4
<PAGE>

product to consumers or deriving any revenue from the southwest regional
network. Although we believe we have the necessary resources to launch the
southwest regional network, we will need additional funding to operate the
network at planned levels and to fund our operations before we breakeven. We
will need additional funding to launch networks in other regions. We currently
do not have any arrangements for additional financing and cannot assure you that
additional financing will be available on acceptable terms, or at all.
Additional equity financing may substantially dilute your investment in ACTV's
common stock.

We are dependent on business relationships with other companies.

            We are dependent upon our relationships with General Instrument,
Scientific-Atlanta and other digital set-top box manufacturers to sell cable
systems digital boxes compatible with our downloadable software. In addition, we
are dependent upon Liberty Media Corporation to fund and direct LMC IATV, our
joint venture with Liberty Media. We are also dependent upon the cooperation of
FOX Sports Net in connection with the marketing of our regional sport network to
cable systems. We can not assure you that these third parties will dedicate
sufficient resources to their relationships with us or perform their obligations
in a time frame that will allow us to implement our current business plan. Their
failure to do so could have a material adverse effect on our operations, or
result in delays in our ability to implement our business plan in a timely
manner.

Our efforts to protect our patents and proprietary information from competitors
may not be adequate to do so.

            We have obtained patents covering certain aspects of Individualized
Television and HyperTVTM and have patents pending with respect to other
developments or enhancements. We cannot assure you that:

            o     patents applied for will be granted;

            o     the patents we own or have rights to or that may be granted or
                  obtained by us in the future will be enforceable or will
                  provide us with meaningful protection from competition;

            o     any products developed by us will not infringe any
                  patent or rights of others; or

            o     we will possess the financial resources necessary to enforce
                  any patent rights that we hold.

            We require each of our employees, consultants and advisors to
execute confidentiality and assignment of proprietary rights agreements upon the
commencement of employment or a consulting relationship with us. These
arrangements generally provide that all inventions, ideas and improvements made
or conceived by the individual arising out of the employment or consulting
relationship shall be our exclusive property. In addition, all proprietary
information is required to be kept confidential and not disclosed to third
parties except with our consent or in other specified circumstances. These
agreements, however, may not provide


                                       5
<PAGE>

effective protection of our proprietary information in the event of unauthorized
use or disclosure of such information.

A delay in the launch of our southwest regional network could adversely affect
our marketing strategy.

            The launch of our southwest regional network is planned for mid-1999
in Dallas. A delay beyond Fall 1999 will not only increase our planned start-up
costs but, more importantly, affect our ability to take market feedback from the
first launch and commence activities in 2000 in other Fox Sports Net regions.

We are dependent upon the experience and expertise of key management and
technical personnel and their loss could put us at a competitive disadvantage.

            We are largely dependent upon the efforts of William C. Samuels,
ACTV's Chairman of the Board and Chief Executive Officer, David Reese,
President, Chief Operating Officer and Director and Bruce Crowley, Executive
Vice President and a Director of ACTV and President of HyperTV Networks, Inc.,
our Internet division. In August 1995, ACTV entered into employment agreements
with Mr. Samuels, which terminates December 31, 2003, and with each of Mr. Reese
and Mr. Crowley, which terminate on December 31, 2000. We currently do not
maintain "key employee" insurance on the lives of Messrs. Samuels, Reese or
Crowley. We may not be able to obtain such insurance at an acceptable cost
should we seek to acquire such insurance in the future.

            We are also dependent on a group of employees, who are expert in the
Java computer language. The Internet industry is very competitive and there is
large demand for, and a high turnover rate of, qualified Java programmers. If we
were required to replace such personnel, we may not be readily able to do so.
Even if we are able to hire such qualified replacements, our business
development may be delayed.

If the computer systems we rely upon are not year 2000 compliant our business
may be adversely affected.

            The year 2000 issue is the result of computer software that was
written with only two digits rather than four digits to represent the year in a
date field. Computer hardware and software applications that are date-sensitive
may interpret a date represented as "00" to be the year 1900 rather than the
year 2000. The result could be system failure or miscalculations causing the
disruption of operations.

            We believe that our internal systems, relating to both computer
hardware and software, will function properly with respect to dates in the year
2000 and beyond. In addition, we believe that our proprietary software either
sold directly to third parties or incorporated in products sold to third parties
is year 2000 compliant. Having performed an assessment of the potential year
2000 problem, we do not expect to incur significant costs related to year 2000
issues.

            However, there is general uncertainty regarding the year 2000
problem and its effect on the overall business environment. We cannot determine
at this time whether the year 


                                       6
<PAGE>

2000 problem will have a material impact on our operations or financial
condition as the result of significant disruptions to the U.S. economy and/or
business infrastructure.

Risks Related to Our Industry

Delivery of our digital programming is dependent upon timely upgrade of analog
cable distribution systems.

            The success of our individualized programming is dependent upon the
slowly evolving digital television market. The number of potential subscribers
to our digital programming services is directly affected by the speed with which
cable systems operators both upgrade their current programming distribution
systems for digital distribution and deploy digital set top boxes to their
subscribers. In order to utilize individualized programming, subscribers must
have a digital television set-top box installed in their homes. The timely
deployment of digital television set-top boxes is entirely out of our control.
There may not be a sufficient number of potential subscribers to receive digital
television set-top boxes in the near future so as to enable us to deploy our
individualized programming in accordance with our business plan. Material delays
in the deployment of digital television distribution systems and set-top boxes
could have a material effect on our results of operations and financial
condition.

Our inability to keep pace with technological change may result in our products
becoming obsolete.

            Both the digital television and Internet platforms are characterized
by extensive research efforts and rapid, significant technological change, often
resulting in product obsolescence or short product life cycles. Our ability to
compete will depend in large part on our capacity to introduce individualized
programming and Internet products in a timely manner, to continually enhance and
improve individualized programming and Internet products, and to adapt to
technological changes and advances in the markets in which we compete. Our
competitors may develop technologies or products that render our individualized
programming and/or Internet products obsolete or less marketable. We may not be
able to keep pace with the demands of an ever-changing marketplace.

There may become a possible shortage of available channels for in-home cable
applications.

            In order for our individualized programming to be delivered over
cable and direct broadcast satellite systems to the home, we must compete with
other programming services for digital channel space. Most distributors of
television programming have channel capacity limitations. Our individualized
programming applications currently require four channels of band-width in a
digital system. We believe, although there can be no assurance, that the cable
and direct broadcast satellite industries, in general, will continue to increase
digital channel capacity. We cannot assure you that distributors of television
programming will devote a sufficient number of channels of band-width to our
individualized programming in the future, even they do increase channel
capacity.

Changes in government funding could hurt our Internet division.

            The success of eSchool Online, our first HyperTV application, is
dependent on public schools' continuing to receive various federal and state
funding for Internet connectivity 


                                       7
<PAGE>

and a broader distribution of computers. If such government funding were to be
substantially reduced or eliminated, it could have a material adverse effect on
our operations and financial condition.

We may not be able to compete effectively in our industry.

            There are two major new digital television applications that
directly compete with us for use of the new digital distribution capability:
high definition television and multicasting. High definition television provides
better color quality, but has the disadvantage of requiring the consumer to
purchase a new expensive television set. Multicasting increases the quantity of
programs available within a channel that used to be able to distribute only one
television program before the conversion to digital. Individualized Television
offers the consumer in depth programming that is tailored to each person's
preferences. It is premature to determine the relative consumer demand for
improved color offered by high definition television, versus greater quantity
offered by multicasting, versus the individualization of content offered by
Individualized Television. As a result, there is a risk that other digital
distribution technologies may be better accepted by the public than our
Individualized Television.

            We compete with many other companies that provide programming for
the television industry and, in particular, with companies that provide sports
programming. Our enhanced version of Fox Sports Net will compete with the
simultaneous telecast of the un-enhanced version of the same event. Such
competitors' programming may obtain greater viewership than our Individualized
Television.

Risks Related to the Offering

Our officers and directors control significant voting rights and can have
substantial influence on matters voted on by stockholders.

            If our officers and directors exercise their options that are
exercisable within 60 days of the date of this prospectus and convert their
convertible preferred stock, they will have the right to vote approximately 5.6
million outstanding shares of common stock, or 15% of the outstanding shares of
common stock. This includes approximately 720,000 shares owned by the Washington
Post Company which William C. Samuels, our Chairman and Chief Executive Officer,
pursuant to a voting agreement, has voting control. Consequently Mr. Samuels has
voting control over approximately 3.6 million shares of common stock, or
approximately 10% of the outstanding shares of common stock. Accordingly, Mr.
Samuels could have substantial influence over the affairs of ACTV, including the
election of directors. If our officers and directors sell their shares included
in this prospectus, which they currently own or may acquire within 60 days, they
will have voting rights over 3.2 million shares, or 10% of the outstanding
shares of common stock.

Your investment may be substantially diluted upon exercise of outstanding
options and warrants.

            As of the date of this prospectus, ACTV has granted options and
warrants to purchase an aggregate of 10,270,346 shares of common stock that had
not been exercised. Of the shares of common stock subject to these unexercised
options and warrants 4,702,016 may be purchased for between $1.00 and $1.99 per
share; 4,730,830 may be purchased for between $2.00 and $2.99 per share; 125,000
may be purchased for between $3.00 and $3.99 per share; 125,000 

                                       8
<PAGE>

may be purchased for between $4.00 and $4.99 per share; and 165,000 may be
purchased for between $5.00 to $5.99 per share and 422,500 may be purchased for
between $6.00 and $6.99 per share. To the extent that the outstanding stock
options and warrants are exercised, our stockholders' interest in ACTV will be
diluted. Moreover, the terms upon which we will be able to obtain additional
equity capital may be affected adversely, since the holders of the outstanding
options and warrants can be expected to exercise them at a time when we would,
in all likelihood, be able to obtain any needed capital on more favorable terms
than those provided in the outstanding options and warrants.

Your investment may be substantially diluted upon conversion of convertible
preferred stock.

            In November 1998, we issued 5,018 shares of ACTV's Series B 10%
Convertible Preferred Stock, which has a face value of $5,018,000 and pays an
annual dividend of 10%. The dividend may be paid either in cash or in kind, at
our option. We may redeem the Series B Preferred at any time at a 10% premium
above face value plus accrued dividends. The Series B Preferred holders may not
convert any Series B Preferred into common stock until November 13, 1999,
whether or not we give a redemption notice prior to such date. If the Series B
Preferred shares are not redeemed for cash by November 13, 1999, the holders may
convert each Series B Preferred share into common stock at a price of $2.00 per
share until February 13, 2000. If the Series B Preferred is not redeemed by
February 13, 2000, its conversion price will be adjusted to a fixed price of
$1.33 per share for the remainder of its life.

            ACTV has outstanding 32,600 shares of Series A Convertible Preferred
Stock which is convertible into common stock based upon a conversion rate of
$1.50 per share of common stock, or approximately 600,000 shares of common
stock.

            Common stockholders will be diluted by future conversions to common
stock, if they should occur, by holders of our convertible preferred stock.
Additionally, since such shares of common stock will be registered for sale in
the marketplace, future offers to sell such shares could have a potentially
depressive effect upon the price of the common stock and make future sales of
common stock by ACTV or our stockholders difficult.

Certain officers' options to acquire voting control of certain of our
subsidiaries may make a takeover difficult.

            ACTV has issued to William C. Samuels, ACTV's Chairman and Chief
Executive Officer, David Reese, ACTV's President, Chief Operating Officer and a
director, Bruce Crowley, ACTV's Executive Vice President and a director,
Christopher Cline, ACTV's Senior Vice President, Chief Financial Officer and
Secretary and certain other employees, options to acquire Class B common stock
of certain of our material subsidiaries. The ten year options are currently
fully vested. In each case, the Class B common stock is identical to the common
stock of each such subsidiary that is owned by ACTV, but has voting rights of 25
votes per share. If exercised, such options will result in the optionees' having
approximately 75% of the voting power of each subsidiary. As a result, should
such options be exercised as to any such subsidiary, the holders thereof would
have the right to elect the Board of Directors of such subsidiary and otherwise
control its business and affairs. The holders have also entered into an
agreement as to the voting of certain of such shares if issued. The exercise of
the options to acquire the Class B common stock of such subsidiaries might
render it more difficult, and therefore discourage, an unsolicited 


                                       9
<PAGE>

takeover proposal such as a tender offer, proxy contest or removal of incumbent
management, even if such actions would be in the best interest of our
stockholders.

Forward looking information may not be realized.

      To the extent that the information presented in this prospectus discusses
financial projections, information or expectations about our products or
markets, or otherwise makes statements about future events, such statements are
forward-looking. Although we believe that the expectations reflected in these
forward-looking statements are based on reasonable assumptions, there are a
number of risks and uncertainties that could cause actual results to differ
materially from such forward-looking statements. These include, among others:

      o     the successful and timely development of new products;

      o     market place acceptance of our new products; and

      o     the availability of sufficient funding to effect such
product development.

      When considering such forward-looking statements, you should keep in mind
the risk factors and other cautionary statements in this prospectus.


                                       10
<PAGE>

                       WHERE YOU CAN FIND MORE INFORMATION

            We file annual, quarterly and special reports, proxy statements, and
other information with the SEC. Our SEC filings are available to the public over
the Internet at the SEC's web site at http://www.sec.gov. You may also 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. ACTV is
listed on the Nasdaq SmallCap Market and the Boston Stock Exchange. Our periodic
reports, proxy statements, and other information can be inspected at the offices
of Nasdaq at 1735 K Street, NW, Washington, DC, 20006, or the offices of the BSE
at 1 Boston Place, Boston, Massachusetts, 02108.

            The SEC allows us to "incorporate by reference" the information we
file with them. This prospectus incorporates important business and financial
information about ACTV which is not included in or delivered with this
prospectus. The information incorporated by reference is an important part of
this prospectus, and information that we file later with the SEC will
automatically update and supersede this information. We incorporate by reference
the following SEC filings:

            o     Annual Report on Form 10-K for the year ended December 31,
                  1998, as filed on March 19, 1999; and

            o     future filings we make with the SEC under Sections 13(a),
                  13(c), 14 or 15(d) of the Securities Exchange Act of 1934
                  until all of the shares offered by the selling security
                  holders have been sold.

            You may obtain a copy of these filings, without charge, by writing
or calling us at:

                                    ACTV, Inc.
                                    1270 Avenue of the Americas
                                    New York, New York 10020
                                    Attention: Secretary
                                    (212) 217-1600

            If you would like to request these filings from us, please do so at
least five business days before you have to make an investment decision.

            You should rely only on the information incorporated by reference or
provided in this prospectus. We have not authorized anyone else to provide you
with different information. We are not making an offer of these securities in
any state where the offer is not permitted. You should not assume that the
information in this prospectus or the documents incorporated by reference is
accurate as of any date other then the date on the front of those documents.


                                       11
<PAGE>

                                 USE OF PROCEEDS

            ACTV will not receive any proceeds from the sale of the
security holders' shares offered by this prospectus. All proceeds from
the sale of the security holders' shares will be for the account of the
selling security holders. See "Selling Security Holders."

                                MATERIAL CHANGES

            There have been no material changes since the filing of ACTV's Form
10-K for the year ended December 31, 1998 on March 19, 1999.

                            SELLING SECURITY HOLDERS

            All of the shares of ACTV common stock offered under this prospectus
may be sold by the holders who either have previously acquired their shares or
who will acquire such shares from ACTV upon the exercise of options, warrants,
or stock appreciation rights, or upon conversion of ACTV's 10% Series B
Convertible Preferred Stock. ACTV will not receive any of the proceeds from
sales of shares offered under this prospectus, but will receive the exercise
price upon the exercise of the options or warrants described above.

            All costs, expenses and fees in connection with the registration of
the security holders' shares will be borne by ACTV. All brokerage commissions,
if any, attributable to the sale of shares by selling security holders will be
borne by such holders.

            The selling security holders are offering a total of 9,858,172
shares of ACTV's common stock. The following table sets forth:

      o     the name of each person who is a selling security holder;

      o     the number of securities owned by each such person at the
            time of this offering; and

      o     the number of shares of common stock such person will own
            after the completion of this offering.

            The following table assumes the exercise of all options and warrants
beneficially owned by each such security holder and the conversion of all Series
B preferred stock into shares of common stock. The column "Beneficial Ownership
Prior to Offering" includes:

      o     shares of common stock issuable upon exercise of all currently
            exercisable options, warrants, and stock appreciation rights and
            conversion of all Series B preferred stock, based on the lesser of
            current or future conversion prices; and

      o     shares that have been registered on previous registration statements
            but have not been sold as of March 12, 1999.

            The column "Beneficial Ownership After Offering" gives effect to the
sale of all the shares of common stock being offered hereby.


                                       12
<PAGE>

<TABLE>
<CAPTION>
                                       Beneficial                                            Beneficial
                                        Ownership                        Shares               Ownership
                                         Prior to                   Included in                   After
Name                                     Offering             %   This Offering                Offering             %

<S>                                     <C>               <C>         <C>                       <C>                <C> 
Westgate International                  2,227,665         6.34%       1,944,710   (1)           282,955             *
Elliott Associates, L.P.                2,159,476         6.14%       1,955,478   (2)           203,998             *
Ravich Children's Trust                   241,953             *         241,953   (3)                 0             *
Ravich Revocable Trust of 1989            417,713         1.22%         417,713   (4)                 0             *
US Bancorp Investments, Inc.            1,183,722         3.37%       1,183,722   (5)                 0             *
Rand Ravich                                42,041             *          42,041   (6)                 0             *
Lee Helper                                  4,000             *           4,000                       0             *
Larry Goldman                               4,000             *           4,000                       0             *
David Alworth                             126,630             *          75,000   (7)            51,630             *
Banca del Gottardo                      4,871,987        14.36%         459,783   (8)         4,412,204        13.01%
Richard Barron                             85,630             *          25,000   (9)            60,630             *
Richard Carvalho                           25,435             *          15,000   (9)            10,435             *
Christopher Cline                         135,342             *          75,000  (10)            60,342             *
Peter Cohen                                 7,000             *           7,000   (9)                 0             *
James Crook                                82,442             *           5,000   (9)            77,442             *
Bruce Crowley                             827,689         2.45%         516,000  (11)           311,689             *
Xiomara DeLeon                              5,724             *           5,000   (8)               724             *
Frank Deo                                  62,500             *          62,500  (12)                 0             *
Jeff Harrington                            25,092             *          10,000   (9)            15,092             *
Brent Imai                                 80,539             *          25,000   (9)            55,539             *
Jennifer Lange                             10,000             *          10,000   (8)                 0             *
Kevin Liga                                 59,550             *          59,550  (13)                 0             *
Eric Martinez                              23,623             *           4,183   (9)            19,440             *
Margie Mercado                              6,809             *           5,000   (8)             1,809             *
Ted O'Donnell                              15,000             *          15,000  (14)                 0             *
Eric Pack                                  12,653             *          12,500   (8)               153             *
Stanley Plesent                            10,000             *          10,000   (9)                 0             *
David Reese                             1,295,648         3.79%         847,000  (15)           448,648         1.35%
William Samuels                         3,910,229        11.18%       1,598,000  (16)         2,312,229         6.92%
Amy Satin                                  15,000             *          15,000   (8)                 0             *
Steven Schuster                            38,334             *          12,500  (14)            25,834             *
Patricia Wilson                             5,117             *           5,000   (8)               117             *
Michael Freeman                           324,746             *          32,000  (17)           292,746             *
Dorsey & Whitney                           90,500             *          40,000                  50,500             *
Craig Ullman                              104,849             *          50,000  (18)            54,849             *
Russell Riopelle                            3,072             *           3,072                       0             *
Bratskeir & Co.                            29,700             *           7,800                  21,900             *
Stuart Lipson                               7,667             *           7,667  (19)                 0             *
C.P. Kersch                                50,000             *          50,000  (19)                 0             *

    Totals                             18,443,156                     9,858,172               8,584,984
</TABLE>

*       Less than one percent

(1)   Consists of 660,671 shares of common stock issuable upon the exercise of
      warrants at $2.00 per share and 1,284,039 shares of common stock issuable
      upon conversion of Series B Preferred Stock at $1.33 per share.


                                       13
<PAGE>

(2)   Consists of 664,329 shares of common stock issuable upon the exercise of
      warrants at $2.00 per share and 1,291,149 shares of common stock issuable
      upon conversion of Series B Preferred Stock at $1.33 per share.
(3)   Consists of 241,953 shares of common stock issuable upon conversion of
      Series B Preferred Stock at $1.33 per share.
(4)   Includes 345,980 shares of common stock issuable upon conversion of 
      Series B Preferred Stock at $1.33 per share.
(5)   Consists of 616,163 shares of common stock issuable upon the exercise of
      warrants at $2.00 per share and 567,559 shares of common stock issuable
      upon conversion of Series B Preferred Stock at $1.33 per share.
(6)   Consists of 42,041 shares of common stock issuable upon conversion of
      Series B Preferred Stock at $1.33 per share.
(7)   Consists of 25,000 shares of common stock issuable upon the exercise of
      options at $1.50 per share and 50,000 shares of common stock issuable upon
      the exercise of stock appreciation rights at $1.50 per share.
(8)   Consists of common stock issuable upon the exercise of options at $1.60
      per share.
(9)   Includes 16,666 shares of common stock issuable upon the exercise of
      options at $1.50 per share.
(10)  Consists of 25,000 shares of common stock issuable upon the exercise of
      options at $1.60 per share and 50,000 shares of common stock issuable upon
      the exercise of stock appreciation rights at $1.50 per share.
(11)  Consists of 382,000 shares of common stock issuable upon the exercise of
      options at $1.50 per share and 134,000 shares of common stock issuable
      upon the exercise of options at $1.60 per share.
(12)  Consists of 62,500 shares of common stock issuable upon the exercise of
      warrants at $1.50 per share.
(13)  Consists of 50,000 shares of common stock issuable upon the exercise of
      warrants at $1.50 per share and 9,550 shares of common stock issuable upon
      the exercise of options at $1.60 per share.
(14)  Consists of common stock issuable upon the exercise of options at $1.63
      per share.
(15)  Consists of 627,000 shares of common stock issuable upon the exercise of
      options at $1.50 per share and 220,000 shares of common stock issuable
      upon the exercise of options at $1.60 per share.
(16)  Consists of 1,248,000 shares of common stock issuable upon the exercise of
      options at $1.50 per share and 350,000 shares of common stock issuable
      upon the exercise of options at $1.60 per share.
(17)  Consists of common stock issuable upon the exercise of stock appreciation
      rights at $1.50 per share.
(18)  Consists of common stock issuable upon the exercise of options at $5.25
      per share.
(19)  Consists of common stock issuable upon the exercise of options at $2.00
      per share.



                                       14
<PAGE>

                          DESCRIPTION OF CAPITAL STOCK

            The total authorized capital stock of ACTV consists of 65,000,000
shares of common stock, par value $0.10 per share, and 1,000,000 shares of
Preferred Stock, par value $0.10 per share. The following descriptions of
capital stock are qualified in all respects by reference to the Restated
Certificate of Incorporation and By-Laws of ACTV, which are incorporated by
reference as exhibits to the Registration Statement of which this prospectus is
a part.

Common Stock

            The holders of common stock will elect all directors and are
entitled to one vote for each share held of record. As of the date of this
prospectus, 33,914,846 shares of common stock were issued and outstanding. All
shares of common stock will participate equally in dividends, when and as
declared by the Board of Directors and in net assets on liquidation. The shares
of common stock will have no preference, conversion, exchange, preemptive or
cumulative voting rights.

Preferred Stock

            ACTV's Certificate of Incorporation authorizes the issuance of
1,000,000 shares of preferred stock with designations, rights and preferences
determined from time to time by its board of directors. Accordingly, ACTV's
Board of Directors is empowered, without stockholder approval, to issue
preferred stock with dividend, liquidation, conversion or other rights that
could adversely affect the rights of holders of common stock. Except as set
forth below, ACTV has no current plans to issue any shares of its preferred
stock, but there can be no assurance that it will not do so in the future.

            ACTV has designated 120,000 shares of its preferred stock as Series
A 7% Convertible Preferred Stock. In November 1997, ACTV issued 86,200 shares of
the Series A Preferred in exchange for consideration equal to $25.00 per share.
The Series A Preferred has a liquidation preference $25.00 per share and pays a
dividend, in cash or accumulated and paid in common stock upon conversion, of 7%
per annum. The Series A Preferred is convertible into ACTV common stock. The
number of shares issued upon conversion is determined by dividing the
liquidation value of $25.00 plus accrued dividends by the conversion price of
$1.50 per common share. As of the date of this prospectus 32,600 shares of
Series A Preferred remain outstanding and would be convertible into
approximately 600,000 shares of common stock if exchanged as of March 12, 1999.

            ACTV has designated 6,110 shares of its preferred stock as Series B
10% Convertible Preferred Stock. In November 1998, ACTV issued 5,018 shares of
the Series B Preferred as a partial exchange for approximately 179,000 shares of
exchangeable preferred stock, which had been issued by a subsidiary of ACTV. The
Series B Preferred has a liquidation preference $1,000.00 per share and pays a
dividend, in cash or accumulated and paid in common stock upon conversion, of
10% per annum.

            The Series B Preferred is fully redeemable by ACTV at any time at a
10% premium above face value plus accrued dividends. The holders of Series B
Preferred are prohibited from converting any shares into common stock through
November 13, 1999, whether 


                                       15
<PAGE>

or not ACTV gives a notice of redemption during this period. Beginning November
13, 1999, the number of shares issued upon conversion is determined by dividing
the liquidation value of $1,000.00 plus accrued dividends by the conversion
price of $2.00 per common share. Beginning February 13, 2000, the number of
shares issued upon conversion is determined by dividing the liquidation value of
$1,000.00 plus accrued dividends by the conversion price of $1.33 per common
share. As of the date of this prospectus 5,018 shares of Series B Preferred
remain outstanding. Such preferred shares are currently not convertible into
common stock and will be convertible into common stock only after November 13,
1999.

            In August 1996, one of ACTV's wholly-owned subsidiaries conducted a
private placement in which it issued an aggregate of 400,000 shares of
exchangeable preferred stock at $25.00 per share and placement agent's warrants
to purchase an aggregate of 36,000 shares of exchangeable preferred stock at
$25.00 per share. The exchangeable preferred stock was exchangeable into common
stock at varying prices.

            During November and December 1998, all of the outstanding
exchangeable preferred stock was either exchanged for common stock or for a
combination of common stock, warrants and Series B Preferred. In addition, all
of the outstanding warrants to purchase exchangeable preferred stock were
exercised and simultaneously converted into common stock.

Transfer Agent

            ACTV's transfer agent is Continental Stock Transfer & Trust Company,
New York, New York 10007.

Shares Eligible for Future Sale

            Assuming exercise/conversion of all of the common stock offered in
this prospectus that are issuable pursuant to warrants, options, stock
appreciation rights, and Series B Preferred Stock, there will be 43,199,296
shares of common stock outstanding. Of these shares, the shares being offered in
this prospectus will be freely tradable without restriction under the Securities
Act of 1933, for so long as this prospectus is kept current by ACTV. An
aggregate of approximately 2.6 million shares of common stock held by existing
stockholders will be "restricted" shares as defined in Rule 144.

            In general, under Rule 144 a person, or group of persons whose
shares are aggregated, who has beneficially owned restricted shares of ACTV for
at least one year, is entitled to sell in normal brokerage transactions during
the periods when certain information regarding ACTV is publicly available,
within any three-month period, an amount of shares that does not exceed the
greater of:

      o     the average weekly trading volume in ACTV's shares during
            the four calendar weeks preceding such sale; or

      o     1% of the shares then outstanding.

      A person who has not been an affiliate of ACTV for the three months prior
to such sale and who has held restricted shares for at least two years would be
entitled to sell such shares without restriction. Most of such restricted shares
are held by non-affiliates of ACTV who will not 


                                       16
<PAGE>

be able to sell such shares under Rule 144 until October 1999. Actual sales, or
the prospect of sales by the present stockholders of ACTV, or by future holders
of restricted securities under Rule 144, or otherwise, may, in the future, have
a depressive effect upon the price of ACTV's common stock.


                                       17
<PAGE>

                              PLAN OF DISTRIBUTION

            Up to 9,284,450 of the security holders' shares may be sold by the
selling security holders who will have acquired such shares from ACTV upon the
exercise of options, warrants, stock appreciation rights, and conversion of
Series B Preferred Stock. ACTV will not receive any of the proceeds from any
sales by selling security holders of their shares, but will receive the exercise
price upon the exercise of options and warrants by the selling security holders.
See "Selling Security Holders."

            The selling security holders have advised ACTV that the sale or
distribution of the common stock may be effected directly to purchasers by the
selling security holders as principals or through one or more underwriters,
brokers, dealers or agents from time to time in one or more transactions,
including crosses or block transactions, by any of the following methods:

      o     on the Boston Stock Exchange;
      o     on the Nasdaq SmallCap Market;
      o     in the over-the-counter market;
      o     in transactions other than on any stock exchange or in the
            over-the-counter market;
      o     through the writing of options on ACTV common stock; or
      o     by settlement of short sales of ACTV common stock.

            The purchase price of the shares may be determined by the
selling security holder or by agreement between the selling security
holder and underwriters, brokers, dealers or agents or purchasers. The
price may be at:

      o market prices prevailing at the time of sale; 
      o prices related to such prevailing market prices; 
      o varying prices determined at the time of sale; or 
      o negotiated or fixed prices.

            If the selling security holders effect such transactions by selling
common stock to or through underwriters, brokers, dealers or agents, such
underwriters, brokers, dealers or agents may receive compensation in the form of
discounts, concessions or commissions from the selling security holders or
commissions from purchasers of common stock for whom they may act as agent which
may be in excess of those customary in the types of transactions involved. The
selling security holders and any brokers, dealers or agents that participate in
the distribution of the common stock may be deemed to be underwriters, and any
profit on the sale of common stock by them and any discounts, concessions or
commissions received by any such underwriters, brokers, dealers or agents may be
deemed to be underwriting discounts and commissions under the Securities Act of
1933.

            Because the selling security holders may each be deemed to be an
"underwriter" within the meaning of Section 2(11) of the Securities Act of 1933,
the selling security holders will be subject to prospectus delivery requirements
under the Securities Act of 1933. Furthermore, in the event of a "distribution"
of its shares, the selling security holder, any selling broker or dealer and any
"affiliated purchasers" may be subject to Regulation M under the Securities
Exchange Act of 1934 until its participation in that distribution is completed.

                                       18
<PAGE>

            At the time a particular offer of security holders' shares is made
by or on behalf of any of the selling security holders, to the extent such offer
constitutes a distribution under the Securities Act of 1933, a supplement to
this prospectus will be distributed, which will set forth the type and number of
securities being offered by such selling security holders and the terms of such
offering, including:

      o     the name or names and addresses of any underwriters,
            dealers or agents;
      o     the purchase price paid by any underwriter for securities
            purchased from the selling security holder; and
      o     any discounts, commissions or concessions allowed or
            reallowed or paid to dealers, and the proposed selling
            price to the public.

            ACTV will bear all costs and expenses of the registration under the
Securities Act of 1933 and certain state securities laws of the security
holders' shares. However, all brokerage commissions, if any, attributable to the
sale of such shares by holders thereof will be borne by such holders.

            The shares that may be offered from time to time by selling security
holders may be sold through ordinary brokerage transactions in the
over-the-counter market or on the Boston Stock Exchange, in negotiated
transactions or otherwise, at market prices prevailing at the time of sale or at
negotiated prices.

            Under the Securities Exchange Act of 1934 and the regulations
thereunder, any person engaged in a distribution of the securities offered by
this prospectus may not simultaneously engage in market-making activities with
respect to shares of ACTV common stock during the applicable two or nine days
"cooling off" period prior to the commencement of such distribution. In
addition, and without limiting the foregoing, the selling security holders will
be subject to applicable provisions of the Securities Exchange Act of 1934 and
the rules and regulations thereunder, including, without limitation, Regulation
M, in connection with transactions in the securities, which provisions may limit
the timing of purchases and sales of the securities by the selling security
holders.


                                       19
<PAGE>

                                  LEGAL MATTERS

            Certain legal matters, including the legality of the issuance by
ACTV of the shares of common stock offered herein, are being passed upon for
ACTV by ACTV's counsel, Gersten, Savage & Kaplowitz, LLP, or GSK, 101 East 52nd
Street, New York, New York 10022. Jay Kaplowitz, a partner in ACTV's counsel
owns options to purchase 25,000 shares of ACTV's common stock.

                                     EXPERTS

            The consolidated financial statements and the related financial
statement schedule incorporated in this prospectus by reference from ACTV's
Annual Report on Form 10-K for the year ended December 31, 1998 have been
audited by Deloitte & Touche LLP, independent auditors, as stated in their
report, which is incorporated herein by reference, which expresses an
unqualified opinion, and have been so incorporated in reliance upon the report
of such firm given upon their authority as experts in accounting and auditing.

                    INDEMNIFICATION OF DIRECTORS AND OFFICERS

            Paragraph "Twelfth" of the Restated Certificate of Incorporation of
ACTV, which contains a provision, as permitted by Delaware law, eliminates the
personal liability of directors to ACTV and its stockholders for monetary
damages for unintentional breach of a director's fiduciary duty to ACTV. This
provision does not permit any limitation on, or elimination of, the liability of
a director for:

      o     disloyalty to ACTV or its stockholders;
      o     failing to act in good faith;
      o     for engaging in intentional misconduct or a knowing violation of 
            law;
      o     for obtaining an improper personal benefit; or
      o     for approving an illegal dividend or stock repurchase.

            The Restated Certificate of Incorporation and By-Laws of ACTV
require ACTV to indemnify directors and officers against expenses, judgments,
fines and amounts paid in settlement in connection with specified actions, suits
or proceedings, whether civil, criminal, administrative or investigative, other
than a derivative action, if they acted in good faith and in a manner they
reasonably believed to be in or not opposed to the best interests of ACTV, and,
with respect to any criminal action or proceeding, had no reasonable cause to
believe their conduct was unlawful. A similar standard of care is applicable in
the case of derivative actions, except that indemnification only extends to
expenses incurred in connection with defense or settlement of such an action.
Moreover, Delaware law requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to ACTV.

            Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of ACTV pursuant to the foregoing provisions, or otherwise, ACTV has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in Securities Act of 1933
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities, other than the payment by ACTV of expenses incurred or
paid by a director, officer or controlling person of ACTV in the successful
defense of any action, suit or proceeding, 


                                       20
<PAGE>

in connection with the securities being registered, ACTV will, unless in the
opinion of 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 Securities Act of 1933 and will
be governed by the final adjudication of such issue.


                                       21
<PAGE>


You may rely only on the information contained in this prospectus. We have not
authorized anyone to provide information different from that contained in this
prospectus. Neither the delivery of this prospectus nor sale of common stock
means that information contained in this prospectus is correct after the date of
this prospectus. This prospectus is not an offer to sell or solicitation of an
offer to buy these shares of common stock in any circumstances under which the
offer or solicitation is unlawful.

             TABLE OF CONTENTS

                                            Page
                                            ----
                                           
Prospectus Summary                            2
Risk Factors                                  4
Where You Can Find More Information          11
Use of Proceeds                              12
Material Changes                             12
Selling Security Holders                     12
Description of Capital Stock                 15
Plan of Distribution                         18
Legal Matters                                20
Experts                                      20
Indemnification of Directors and Officers    20


                               ACTV, INC.


9,858,172 shares of Common Stock offered by Selling Security Holders, consisting
of:

(a) 573,722 shares of Common Stock, and

(b) 9,284,450 shares of Common Stock issuable upon the exercise of options,
warrants, stock appreciation rights and upon the conversion of convertible
preferred shares









                             April 9, 1999




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