[EQUITY] $1,370,250
[DEBT] 0
[CONVERTIBLE] 0
[OTHER] 0
As filed with the Securities and Exchange Commission on October 8, 1999.
Commission File No. 0-20598
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________
AMENDMENT NO. 1
TO
REGISTRATION STATEMENT ON FORM S-3
Under The Securities Act of 1993
________________________
DEFINITION, LTD.
(Exact name of Registrant as specified in its charter)
NEVADA 75-2293489
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
4625 W. Nevso Drive, Suite 2, Las Vegas, NV 89103, (702) 257-2367
(Address including zip code, and telephone number, including area code, of
registrant's principal
executive offices)
Charles Kiefner
Chairman
Definition, Ltd.
4625 West Nevso Drive, Suite 2
Las Vegas, Nevada 89103
(702) 257-2367
(Name and address, including zip code, and telephone number, including area
code, of agents for service)
- ----------------------------------------------------------------------------
Copy to:
CHARLES A. CLEVELAND, P.S.
Charles A. Cleveland, Esquire
1212 North Washington, Suite 304
Spokane, Washington 99201-2401
(509) 326-1029
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement has become effective.
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 line: [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
1
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_______________________________________________________________________
Calculation Of Registration Fee
Proposed Proposed
maximum maximum
offering price aggregate offering
Title of Securities Amount to be price per price per share
to be registered share [1] price[1] price [1]
Common Stock,
$0.001 par value 1,631,250 shares $0.84[1] $1,370,250
__________________
Amount of Registration fee $ 384.00 [2]
____________________________________________________________________________
[1] The maximum offering price was calculated pursuant to Rule 457(c), based
upon the closing bid price for the Common Stock on September 16, 1999.
[2] Minimum fee.
2
<PAGE>
DEFINITION LTD.
Cross Reference Sheet Required by Item 501(b) of Regulation S-K
Form S-3 Item Number and Caption Caption in Prospectus
- -------------------------------- ----------------------
1. Forepart of Registration Statement Facing Page of Registration
and Outside Front Cover Page Statement and Cover Page of
of Prospectus Prospectus
2. Inside Front and Outside Back Inside Cover Page of
Cover Pages of Prospectus Prospectus
and Outside Cover Page of
Prospectus
3. Summary Information, Risk Not Applicable
Factors and Ratio of Earnings to
Fixed Charges
4. Use of Proceeds Not Applicable
5. Determination of Offering Price Not Applicable
6. Dilution Not Applicable
7. Selling Security Holders Sales by Selling Shareholders
8. Plan of Distribution Cover Page of Prospectus and
Sales by Selling Shareholders
9. Description of Securities to Grant of Stock Bonus; and
be Registered Sales by Selling Shareholders
10.Interest of Named Experts Not Applicable
and Counsel
11.Material Changes Not Applicable
12.Incorporation of Certain Information Incorporation of Certain
by Reference Information by Reference
13.Disclosure of Commission Position Indemnification
on Indemnification or Securities
Act Liabilities
3
<PAGE>
PROSPECTUS
DEFINITION, LTD.
1,631,250 Shares of Common Stock
($0.001 par value per share)
The shareholders named in the table included in the "Selling Shareholders"
section of this prospectus, which begins on page 10, are offering all of the
shares of common stock covered by this prospectus. Those people are called
selling shareholders and will be referred to throughout this document as the
"Selling Shareholders".
We will not receive any of the proceeds from such sales. We will pay all
expenses in connection with this offering, other than commissions and
discounts of underwriters, dealers or agents.
The Selling Shareholders may sell all or a portion of their stock at any
time whether through a broker, or otherwise. The stock will generally be
sold at the market price or whatever price is negotiated.
Our common stock is quoted on the OTC Electronic Bulletin Board (Symbol: DFNL).
On September 16, 1999, the closing price of the common stock was $0.84 per
share.
See "Risk Factors" beginning on page 8 for a description of certain factors
that should be considered by purchasers of the common stock.
We have not, nor has any individual named in this prospectus, authorized any
person to give any information or to make any representation other than those
contained in, or incorporated by reference into, this prospectus. This
prospectus does not constitute an offer to sell or solicitation of an offer
to buy.
We have filed a registration statement on Form S-3 in respect of the
common stock offered by this prospectus with the Securities and Exchange
Commission under the Securities Act. This prospectus does not contain all of
the information contained in the registration statement. You should read
this entire prospectus carefully as well as the registration statement for
additional information.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED ON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
___________
This Prospectus does not constitute an offer to sell securities in any state
to any person to whom it is unlawful to make such offer in such state.
The date of the Prospectus is September 22, 1999.
4
<PAGE>
TABLE OF CONTENTS
Where You Can Find More Information.........................................6
Forward-Looking Statements ............................................. 7
About Us................................................................... 7
Risk Factors............................................................... 8
Use of Proceeds........................................................... 10
Selling Stockholders...................................................... 10
Plan of Distribution...................................................... 11
Our Common Stock.......................................................... 12
Indemnification........................................................... 13
Legal Matters............................................................. 14
Experts................................................................... 14
5
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We must file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any documents we file at
the SEC's public reference rooms in Washington, DC, New York, NY and Chicago,
IL. 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. Our file number is File
No. 0-20598. In addition, our proxy and information statements and other
information about us can be inspected at the offices of the National
Association of Securities Dealers, Inc., 1735 R Street, N.W., Washington,
D.C. 20006.
The SEC allows us to "incorporate by reference" information into this
prospectus, which means that we can disclose important information to you by
referring you to another document filed separately with the SEC. The
information incorporated by reference is considered to be part of this
prospectus.
Information in this prospectus may update documents previously filed with the
SEC, and later information that we file with the SEC will automatically
update this prospectus. We incorporate by reference the documents listed
below and any future filings made with the SEC under Sections 13(a), 13(c),
14 or 15(d) of the Securities Exchange Act of 1934 prior to the termination
of the offering:
(1) The Company's latest Annual Report on Form 10-KSB for the year ended
December 31, 1998;
(2) The Company's Quarterly Report on Form 10-QSB for the period ended
March 31, 1999.
(3) The Company's Quarterly Report on Form 10-QSB for the period ended
June 30,1999; and
(4) All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the Company's
Annual Report referred to above.
All reports and documents filed by the Company pursuant to Section 13, 14 or
15(d) of the Exchange Act, prior to the filing of a post-effective amendment
which indicate that all securities offered hereby have been sold or which
de-registers all securities then remaining unsold, shall be deemed to be
incorporated by reference herein and to be a part hereof from the respective
date of filing of each such document. Any statement incorporated by
reference herein shall be deemed to be modified or superseded for purposes
of this Prospectus to the extent that a statement contained herein or in any
other subsequently filed document, which also is or is deemed to be
incorporated by reference herein, modified or supersedes such statement.
Any statement modified or superseded shall not be deemed, except as so
modified or superseded, to constitute part of this Prospectus.
You may request a copy of these filings at no cost, by writing or telephoning us
at the following address:
Corporate Secretary,
Definition, Ltd.
4625 West Nevso Drive, Suite 2
Las Vegas, Nevada 89103
telephone (561)844-7701
Information on our website is not part of this prospectus.
6
<PAGE>
FORWARD LOOKING STATEMENTS
Some of the information in this prospectus contains forward-looking statements
that involve substantial risks and uncertainties. You can identify these
statements by forward-looking words such as "may," "will," "expect,"
"anticipate," "believe," "intend," "estimate" and "continue" or similar
words. You should read statements that contain these words carefully for
the following reasons:
- the statements discuss our future expectations;
- the statements contain projections of our future earnings or of
our financial condition; and
- the statements state other "forward-looking" information.
We believe it is important to communicate our expectations to our
investors. There may be events in the future, however, that we are not
accurately able to predict or over which we have no control. The risk
factors listed above, as well as any cautionary language in or incorporated by
reference into this prospectus, provide examples of risks, uncertainties and
events that may cause our actual results to differ materially from the
expectations we describe in our forward-looking statements. The SEC allows
us to "incorporate by reference" the information we file with them, which
means we can disclose important information to you by referring you to those
documents. Before you invest in our common stock, you should be aware that
the occurrence of any of the events described in the above risk factors,
elsewhere in or incorporated by reference into this prospectus and other
events that we have not predicted or assessed could have a material adverse
effect on our earnings, financial condition and business. If the events
described above or other unpredicted events occur, then the trading price
of our common stock could decline and you may lose all or part of your
investment.
ABOUT US
We were formed on March 13, 1989 in the State of Nevada. Originally we
acquired the rights and license to sell and exploit commercially a patented
stone hot plate that operated without electrical connection, in the United
States, Canada, Mexico and the West Indies. We also obtained and further
enhanced procedures for the development, decoration, establishment and
operation of restaurants in the United States and such other countries
using the Stone Grill for tabletop cooking. From 1989 to 1993, we tried
to market and sell the Stone Grill cooking and its Stone Grill products and,
even tested a restaurant in 1991. During 1993, we decided not to continue
in the restaurant business. We sold all of our interest to Stone Grill
Restaurants, Inc., a related company.
During 1994, we started to acquire the materials to do business in interactive
media and communications. We started to acquire programming, a broadcast
film library, computers, video, studio, broadcast and cable equipment and
pre-paid air time.
Our business includes the production of direct response programming, and
interactive programming for use around the world, including educational
software, infomercials, interactive computer media, video and the sale of
television advertising. Our primary station is WAQ-TV 19, in West Palm Beach,
Florida. We also sell outside the U.S., copies of video, film clips and
programming from our broadcast film library. Our library contains many
programs, documentaries, newsreels, music books and educational footage. We
are also involved with the production of television programs for broadcast
in the West Palm Beach, Florida, and the Dallas/Fort Worth, Texas areas.
We also produce one-hour infomercials for video and cable television
broadcast.
We are seeking to develop customers and sales utilizing the "Internet". We
are working with World Wide Marketing, a Europe-based firm ("WWM"). We bring
into the United States art, art objects and craft items from Italy, which
are being sold at auction by Sotheby Auctioneers in cooperation with
Hofstra University, Hempstead, New York. Most of the items we import are
obtained from large and small vendors and craftsmen located primarily in the
Verona, Italy, area.
7
<PAGE>
RISK FACTORS
You should carefully consider the risks described below before making an
investment decision. The risks and uncertainties described below are not
the only ones facing us. Additional risks and uncertainties not presently
known to us or that we currently deem immaterial may also impair our business
operations. If any of the following risks actually occur, our business,
financial condition or results of operations could be materially and
adversely affected. In such case, the trading price of our common stock could
decline, and you may lose all or part of your investment.
PROBLEMS WITH LOW-POWER TELEVISION STATIONS. Our primary business is a
community (low-power) television station. We have to compete with other far
more powerful television stations and cable-television stations and other
means of advertising, like radio or newspapers.
OPERATIONS SUBJECT TO EXTENSIVE GOVERNMENT REGULATION - If our business is
alleged or found to violate television broadcasting and applicable laws set by
the Federal Communications Commission, our revenue and earnings could
materially decrease.
Our business is subject to extensive, frequently changing, federal, state and
local regulation regarding the following:
- - prohibitions and limitations on types of advertising;
- - television licensing requirements;
- - health and safety requirements;
environmental concerns, such as electrical or signal transmissions;
changing technology requirements.
Some of these laws may restrict or limit our business. Much of this
regulation, particularly technology requirements, is complex and open to
differing interpretations. If any of our operations are found to violate
these laws, we may be subject to severe sanctions or be required to alter or
discontinue our operations. If we are required to alter our practices, we may
not be able to do so successfully. The occurrence of any of these events
could cause our revenue and earnings to decline.
WE MAY NOT BE PROFITABLE OR GENERATE CASH FROM OPERATIONS IN THE FUTURE.
- -- We have incurred significant losses in the last several years. We
intend to continue to expend significant financial and management resources
on the development of additional products, sales and marketing, improved
technology and expanded operations. Although we believe that operating
losses and negative cash flows may diminish in the near future, we may not
be profitable or generate cash from operations in the foreseeable future.
IF WE DO NOT SECURE ADDITIONAL FINANCING, WE MAY BE UNABLE TO DEVELOP OR
ENHANCE OUR SERVICES, TAKE ADVANTAGE OF FUTURE OPPORTUNITIES OR RESPOND
TO COMPETITIVE PRESSURES.
- -- We require substantial working capital to fund our business. We have had
significant operating losses and negative cash flow from operations.
Additional financing may not be available when needed on favorable terms or
at all. If adequate funds are not available or are not available on
acceptable terms, we may be unable to develop or enhance our services,
take advantage of future opportunities or respond to competitive pressures,
which could materially adversely affect our business. Our capital
requirements depend on several factors, including the rate of market
acceptance of our products, the ability to expand our customer base,
the growth of sales and marketing and other factors. If capital
requirements vary materially from those currently planned, we may require
additional financing sooner than anticipated.
8
<PAGE>
DEPENDENCE UPON KEY PERSONNEL - If we lose any of our executive officers, or
are unable to attract and retain qualified management personnel and
directors, our ability to run our business could be adversely affected and
our revenue and earnings could decline.
- -- We are dependent upon the services and management skills of our executive
officers, Donna Anderson, President/Chief Executive Officer and Charles R.
Kiefner, Chairman of the Board and Secretary. Mr. Kiefner has been with us
since August, 1997. We have not entered into employment agreements with Ms.
Anderson and Mr. Kiefner. We do not maintain key man life insurance on
either officer. Further, our growth strategy will depend, in part, on our
ability to attract and retain additional key management, marketing and
operating personnel.
CONTROL BY EXISTING MANAGEMENT - Certain members of our board of Directors
own a significant portion of our outstanding common stock.
- -- Our Board of Directors, officers and their respective affiliates
beneficially own 58.5% of our outstanding common stock. Although these
persons do not have any agreements or understandings to act or vote in
concert, any such agreement, understanding or acting in concert would make
it difficult for others to elect the entire Board of Directors, or to
control the disposition of any matter submitted to a vote of shareholders.
THE VALUE OF OUR STOCK HAS IN THE PAST AND MAY IN THE FUTURE CHANGE
SUDDENLY AND SIGNIFICANTLY. The trading price of our common stock has been
subject to significant fluctuations to date and could be subject to wide
fluctuations in the future, in response to many factors, including the
following:
. Quarter-to-quarter variations in our operating results,
. New Licensing requirements,
. General conditions in the markets for our products or the television
industry,
. The price and availability of advertising revenue,
. General financial market conditions, or
. Other events or factors.
In this regard, we do not endorse or accept responsibility for the estimates
or recommendations issued by stock research analysts from time to time. The
volatility of public stock markets, and media stocks specifically, have
frequently been unrelated to the operating performance of the specific
companies. These market fluctuations may adversely affect the market price
of our common stock.
PROPRIETARY PROTECTION. As part of our business we have tried to build up a
library of films to be used for infomercials, documentaries, movies,
newsreels and educational films. Our products may not be protected by
registered copyrights, and we have not filed any copyright applications
in any jurisdiction. The lack of copyright protection may limit our ability
to distinguish ourselves from other industry competitors. In addition, while
we license our films to purchasers and restrict unauthorized use under our
licensing provisions, this does not protect us from an erosion of potential
revenue due to illicit use and piracy.
9
<PAGE>
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares of our
common stock by the Selling Shareholders.
SELLING SHAREHOLDERS
The following table lists (a) the name of the Selling Shareholders (b) the
number of shares of common stock beneficially owned by each Selling
Shareholder prior to the offering (c) the number of shares being offered
under this prospectus by such Selling Shareholders; and (d) the number of
shares of common stock beneficially owned by each Selling Shareholder after
the completion of the offering. The table assumes that the Selling
Shareholders will sell all shares they are offering under this prospectus,
and that the Selling Shareholders will not acquire additional shares of our
common stock prior to completion of this offering. The shares are being
registered to permit secondary trading of the Shares, and the Selling
Shareholders may offer such shares for resale from time to time. See
"Plan of Distribution.".
Number of Shares to Percentage
Name of Shares Shares to Be Owned To Be Owned
Selling Shareholder Owned Be Offered After Offering After
Offering
- ------------------ ------ ---------- ------------- --------
CHARLES R. KIEFNER 3,488,450 300,000 3,188,450 26.88%
238 Wilshire Boulevard
Casselberry, Florida 32707
GUY E. EVANS 73,500 26,250 47,250 0.4%
P O Box 12978
Jackson, Mississippi
ROBERT GOLDMAN 225,000 225,000 0 0
1510 W. Montana Street
Chicago, Illinois 60604
BIANCA HODGE 100,000 100,000 0 0
48 Sunset Avenue
Farmingdale, New York 11735
THE B.N.K. CORPORATION 100,750 100,000 750 0
238 Wilshire Boulevard, Suite 149
Casselberry, Florida 32707
STERLING CONSULTING CO. 500,000 500,000 0 0
c/o John Anderson
797 North High Road
Pam Springs, California 92262
LAURA M. KOUGH 250,000 250,000 0 0
312 P Nicholson Drive
Winter Park, Florida 32792
ROBERT CRAWFORD 30,200 30,000 200 0
61 Crestwood Drive
St. Louis, Missouri 63105
CHARLES A. CLEVELAND 100,000 100,000 0 0
Rock Pointe Center
1212 North Washington, Suite 304
Spokane, Washington 99201-2401
10
<PAGE>
(1) Except as set forth herein, all securities are directly owned and the
sole investment and voting power are held by the person named. A person
is deemed to be the beneficial owner of securities that can be acquired
by such person within 60 days of September 15, 1999 upon the exercise of
options or warrants.
(2) Based upon 11,862,873 shares of Common Stock issued and outstanding.
Each beneficial owner's percentage is determined by assuming that all such
exercisable options or warrants that are held by such person (but not those
held by any other person) have been exercised.
PLAN OF DISTRIBUTION
The Company has been advised by the Selling Shareholders that they intend to
sell all or a portion of their Shares offered by this prospectus from time
to time. These sales may be made:
- on the over-the-counter market;
- to purchasers directly;
- in ordinary brokerage transactions in which the broker solicits
purchasers;
- through underwriters, dealers and agents who may receive
compensation in the form of underwriting discounts, concessions
or commissions from a seller and/or the purchasers of the shares
for whom they may act as agent;
- through the pledge of shares as security for any loan or obligation,
including pledges to brokers or dealers who may from time to
time effect distributions of the shares or other interests in
the shares;
- through purchases by a broker or dealer as principal and resale by
such broker or dealer for its own account pursuant to this
prospectus;
- through block trades in which the broker or dealer so engaged will
attempt to sell the shares as agent or as riskless principal but
may position and resell a portion of the block as principal to
facilitate the transaction;
- in any combination of one or more of these methods; or
- in any other lawful manner.
The Selling Shareholders may also make private sales directly or through a
broker or brokers, who may act as agent or as principal. In connection with
any sales, such Selling Shareholders and any brokers participating in such
sales may be deemed to be underwriters within the meaning of the Securities
Act and any compensation received by them might be deemed to be underwriting
discounts and commissions under the Securities Act.
Any broker-dealer participating in such transactions as agent may receive
commissions from the Selling Shareholders (and, if they act as agent for the
purchaser of such Shares, from such purchaser). Brokerage fees may be paid
by the Selling Shareholder, which may be in excess of usual and customary
brokerage fees. Broker-dealers may agree with the Selling Shareholders to
sell a specified number of Shares at a stipulated price, and, to the extent
such a broker-dealer is unable to do so acting as agent for any Selling
Shareholder, to purchase as principal any unsold Shares at the price
required to fulfill the broker-dealer's commitment to such Selling
Shareholder. Broker-dealers who acquire Shares as principal may thereafter
resell such Shares from time to time in transactions (which may involve
crosses and block transactions and which may involve sales to and through
other broker-dealers, including transactions of the nature described above)
on the over-the-counter Bulletin Board, in negotiated transactions or
otherwise at market prices prevailing at the time of sale or at negotiated
prices, and in connection with such resales may pay to or receive from
the purchasers of such Shares commissions computed as described above.
Any Shares covered by this Prospectus which qualify for sale pursuant
to Rule 144 under the Securities Act may be sold under that Rule rather
than pursuant to this Prospectus.
11
<PAGE>
The Selling Shareholders will be subject to the applicable provisions
of the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder, including without limitation Regulation M, which
provisions may limit the timing of purchases and sales of any of the Common
Stock by the Selling Shareholders. All of the foregoing may affect the
marketability of the Common Stock.
We will pay substantially all the expenses incident to this offering of Shares
by the Selling Shareholders, other than brokerage and selling fees.
The Selling Shareholders will pay all applicable stock transfer taxes,
transfer fees and brokerage commissions or underwriting or other discounts.
We have agreed to indemnify the selling shareholders against certain
liabilities, including liabilities under the Securities Act.
In order to comply with certain states' securities laws, if
applicable, the common stock will be sold in such jurisdictions only
through registered or licensed brokers or dealers. In addition, in certain
states the common stock may not be sold unless the common stock has been
registered or qualified for sale in such state or an exemption from
registration or qualification is available and we or Selling Shareholders
comply with the applicable requirements.
We may be required to file a supplemental prospectus in connection with
any activities involving a seller which may be deemed to be an
"underwriting." In that case, a supplement to this prospectus would contain:
(1) information as to whether an underwriter selected by a seller, or
any other broker-dealer, is acting as principal or agent for the seller,
(2) the compensation to be received by an underwriter selected by a
seller or any broker-dealer, for acting as principal or agent for a seller and
(3) the compensation to be received by any other broker-dealer, in
the event the compensation of such other broker-dealers is in excess of
usual and customary commissions.
Any broker or dealer participating in any distribution of the shares may
be required to deliver a copy of this prospectus, including any prospectus
supplement, to any individual who purchases any shares from or through such
a broker-dealer.
DESCRIPTION OF SECURITIES
Common Stock
We can issue up to 50,000,000 shares of Common Stock, $0.001 par value per
share. Our stockholders are entitled to one vote per share on each matter
submitted to a vote at any meeting of shareholders. A majority of our
outstanding Common Stock can elect the entire Board of Directors of the
Company. Our bylaws say that a majority of the outstanding shares is a
quorum for shareholders' meetings, except if the bylaws or a law say
otherwise.
Our Shareholders have no preemptive rights to acquire additional shares of
Common Stock or other securities. Our Common Stock is subject to redemption
and will carry no subscription or conversion rights. If we liquidate, our
Common Stock will be entitled to share equally in corporate assets after
satisfaction of our bills. The shares of Common Stock, once issued, is
fully paid and non-assessable.
Our stockholders can receive dividends if the Board of Directors decides to do
so and if we have the funds legally available. We intends to expand our
business through reinvesting our profits, if we have any, and don't expect
to pay dividends.
Our Directors have the authority to issue shares without action by the
shareholders.
Transfer Agent
The transfer agent for the shares of Common Stock of the Company is Corporate
Stock Transfer, 370 17th Street Suite 2350, Denver, Colorado 80202.
12
<PAGE>
INDEMNIFICATION
Our Articles of Incorporation, as amended, limit, to the maximum extent
permitted by law, the personal liability of our directors and officers for
monetary damages for breach of their fiduciary duties as directors and
officers, except in certain circumstances involving certain wrongful acts,
such as a breach of the director's duty of loyalty or acts of omission which
involve intentional misconduct or a knowing violation of law.
Nevada law provides that Nevada corporations may include within their articles
of incorporation provisions eliminating or limiting the personal liability of
their directors and officers in shareholder actions brought to obtain
damages for alleged breaches of fiduciary duties, as long as the alleged
acts or omissions did not involve intentional misconduct, fraud, a knowing
violation of law or payment of dividends in violation of the Nevada statutes.
Nevada law also allows Nevada corporations to include in their articles of
incorporation or bylaws provisions to the effect that expenses of officers
and directors incurred in defending a civil or criminal action must be paid
by the corporation as they are incurred, subject to an undertaking on behalf
of the officer or director that he or she will repay such expenses if it is
ultimately determined by a court of competent jurisdiction that such officer
or director is not entitled to be indemnified by the corporation because such
officer or director did not act in good faith and in a manner reasonably
believed to be in or not opposed to the best interests of the corporation.
Nevada law provides that Nevada corporations may eliminate or limit the
personal liability of its directors and officers. This means that the
articles of incorporation could state a dollar maximum for which directors
would be liable, either individually or collectively, rather than
eliminating total liability to the full extent permitted by the law.
Our Charter provides that a director or officer is not be personally liable
to us or our shareholders for damages for any breach of fiduciary duty as
a director or officer, except for liability for (i) acts or omissions which
involve intentional misconduct, fraud or a knowing violation of law, or
(ii) the payment of distribution in violation of Nevada Revised Statures,
Sec 78.300. In addition, Nevada Revised Statutes, Sec 78.751 and Article VII of
our Bylaws, under certain circumstances, provided for the indemnification
of the officers and directors of the Company against liabilities which they
may incur in such capacities. A summary of the circumstances in which such
indemnification is provided for is set forth in the following paragraph, but
such summary is qualified in its entirety by reference to Article VII of our
Bylaws.
In general, any director of officer (an "Indemnitee") who was or is a party
to, or is threatened to be made a party to, or is otherwise involved in any
threatened, pending or completed action or suit (including,
without limitation, an action, suit or proceeding by or in the right of us),
whether civil, criminal, administrative or investigative (a "Proceeding")
by reason of the fact that the Indemnitee is or was a director or officer
of us or is or was serving in any capacity for us as a director, officer,
employee, agent, partner or fiduciary of, or in any other capacity for,
another corporation or any partnership, joint venture, trust or other
enterprise shall be indemnified and held harmless by us for actions taken
by the Indemnitee and for all omissions to the full extent permitted by
Nevada law against all expense, liability and loss (including, without
limitation, attorneys' fees, judgments, fines, taxes, penalties and amounts
paid or to be paid in settlement) reasonably incurred or suffered by the
Indemnitee in connection with any Proceeding.
The rights to indemnification specifically include the right to
reimbursement by us for all reasonable costs and expenses incurred in
connection with the Proceeding and indemnification continues as to an
Indemnitee who has ceased to be a director or officer. The Board of
Directors may include employees and other persons as though they were
Indemnitees. The rights to indemnification are not exclusive of any
other rights that any person may have by law, agreement or otherwise.
The Bylaws also provide that we can purchase and maintain insurance or make
other financial arrangements on behalf of any person who otherwise qualifies
as an Indemnitee under the foregoing provisions. Other financial
arrangements to assist the Indemnitee are also permitted, such as the
creation of a trust fund, the establishment of a program of self-insurance,
the securing of our obligation ofindemnification by granting a security
interest or other lien on any of our assets (including cash) and the
establishment of a letter of credit, guaranty or surety.
13
<PAGE>
We and Interactive Systems, Inc., our wholly-owned subsidiary (ISI),
have entered into agreements with each of their respective directors,
executive officers and significant employees providing for indemnification
by us and by ISI of each of them to the extent permitted by our respective
Charters and Bylaws.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling us
pursuant to the foregoing provisions, we have been informed that in the
opinion of the Securities and Exchange Commission, such indemnification
is against public policy as expressed in the Securities Act and is therefore
unenforceable.
LEGAL MATTERS
Our attorney, Charles A. Cleveland, P.S., Spokane, Washington will pass
upon the validity of the issuance of the shares of common stock offered
hereby and certain other legal matters. Charles A. Cleveland, the sole
shareholder of the law firm, beneficially owns 100,000 shares of common
stock and is a Selling Shareholder.
EXPERTS
The consolidated financial statements and the related financial statement
schedules incorporated in this prospectus by reference from the Company's
Annual Report on Form 10-KSB and 10-KSB/A for the Year ended December 31,
1998 have been audited by Clancy & Co., PLLC, Certified Public Accountants,
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
as stated in their report.
14
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 14. Other Expenses Of Insurance And Distribution
The following sets forth the estimated expenses and costs in connection
with the issuance and distribution of securities being registered hereby.
All such expenses will be borne by the Company.
Securities and Exchange Commission Registration Fee...... $ 384.00[2]
Accounting Fees and Expenses............................. 2,000.00*
Legal Fees and Expenses.................................. [1]
Printing expenses........................................ 2,000.00
Miscellaneous............................................ 1,250.00*
----------
Total.................................................... $5,634 [1]
======
- ---------------------
* Estimated
[1] Legal Fees will be paid in the form of Common Stock
Item 15. Indemnification Of Directors And Officers.
Nevada Revised Statutes 78.037 is incorporated herein by this reference.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended, the Securities Exchange Act of 1934 or the Rules and
Regulations of the Securities and Exchange Commission thereunder may be
permitted under said indemnification provisions of the law, or otherwise,
the Company has been advised that, in the opinion of the Securities and
Exchange Commission, any such indemnification is against public policy and
is, therefore, unenforceable.
ARTICLES AND BYLAWS. The Company's Articles of Incorporation and the
Company's Bylaws provide that the Company shall, to the fullest extent
permitted by law, indemnify all directors of the Company, as well as any
officers or employees of the Company to whom the Company has agreed to
grant indemnification.
Item 16. Exhibits And Financial Statement Schedules.
Certain of the following exhibits are filed as part of this registration
statement.
The following are filed as exhibits to this Registration Statement:
Sequentially
Numbered
Exhibit No. Description
- ----------- ----------- ------------
Instruments defining the rights of security holders including indentures
4.2 Amended and Restated Articles of Incorporation, dated January 13,
1995, of the Company. Incorporated by reference to the
Company's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 1998.
4.3 By-laws of the Company, dated January 13, 1995. Incorporated by
reference to the Company's Annual Report on Form 10-K, for the
fiscal year ended December 31, 1998.
5 Opinion of Charles A. Cleveland, re: Legality
24.1 Consent of Clancy and Co., P.L.L.C., Certified Public Accountants
25.1 Consent of Charles A. Cleveland, Attorney At Law Powers of
Attorney
(contained on Sequential page of this Registration Statement)
Item 17. Undertakings.
The 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 Act;
(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 Paragraphs (a)(1)(i) and (a)(1)(ii) above do not
apply if the information required to the 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
and Exchange Act of 1934, as amended (the "Exchange Act"), that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the Act, 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.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the Registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is incorporated
by reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(c)Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the registrant
has been advised that in the opinion of the Securities and Exchange
Commission 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing of 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 Las Vegas, State of Nevada, on the 8 day of
October, 1999.
DEFINITION, LTD.
By: _____________________________
/s/ Donna Anderson
Title: President, Chief Executive Officer,
By: _____________________________
/s/ Charles Kiefner
Title: Chairman, Secretary
Date: October 8, 199
KNOW ALL MEN BY THESE PRESENT, that each person whose signature appears
below constitutes and appoints Donna Anderson, as his/her true and lawful
for him and in
his name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this Registration
Statement, and to file the same, therewith, with the Securities and Exchange
Commission, and to make any and all state securities law or Blue Sky
filings, granting unto said attorney-in-fact and agent, full power and
authority to do and perform each and every act and thing requisite or
necessary to be done in about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying the confirming
all that said attorney-in-fact and agent, or any substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
Signature Title Date
- --------- ----- -----
__________________ President and Director October 8, 1999.
/s/ Donna Anderson
__________________ Chairman, Secretary and October 8, 1999.
/s/ Charles Kiefner Director
__________________ Director October 8, 1999.
/s/ Steven Gallagher
__________________ Director October 8, 1999.
/s/ Frankie Randall
Exhibit 24.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement
on Form S-3 of Definition, Ltd., of our report on examination of the
financial statements of Definition, Ltd., for the years ended December 31,
1998 and 1997, dated August 9, 1999, appearing in the Annual Report to
Stockholders for the year ended December 31, 1998 and incorporated in the
Company's Annual Report on Form 10-KSB and to the use of our name, and the
statements with respect to us, as appearing under the heading "Experts" in
the Prospectus.
Clancy & Company, P.L.L.C.
Certified Public Accountants
Phoenix, Arizona
October 8, 1999
