PROSPECTUS
FINAL PROSPECTUS
PURSUANT TO RULE 424(b)(3)
FILE NO. 333-86867
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425,000 SHARES
CHILDREN'S BROADCASTING CORPORATION
COMMON STOCK
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The shareholders listed on page 8 below are offering and selling
425,000 shares of our common stock under this prospectus. We will not receive
any part of the proceeds from this offering.
Our common stock is quoted on the Nasdaq National Market and trades
under the ticker symbol "FILM." On September 22, 1999, the closing price of one
share of our stock on the Nasdaq National Market was $1.9375.
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NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR
DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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THE SHARES INVOLVE CERTAIN RISKS. SEE "RISK FACTORS" BEGINNING ON
PAGE 4.
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THE DATE OF THIS PROSPECTUS IS SEPTEMBER 24, 1999
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PROSPECTUS SUMMARY
BECAUSE THIS IS A SUMMARY, IT DOES NOT CONTAIN ALL THE INFORMATION THAT
MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS CAREFULLY BEFORE
YOU DECIDE TO INVEST.
OUR REPOSITIONING
We currently do business as iNTELEFILM Corporation and we believe that,
through a series of transactions, we have become the largest producer of
television commercials in the world. In the second quarter of 1999, we utilized
our resources to increase our ownership interest in Harmony Holdings, Inc., a
corporation which produces television commercials, music videos and related
media, to 55.2%. Over the last nine months, we advanced Harmony $3.25 million
pursuant to promissory notes. Although $2.28 million remained outstanding as of
August 31, 1999, the promissory notes are eliminated through consolidation for
reporting purposes. In addition, we also guarantee a $5.0 million line of credit
for Harmony which is included on our consolidated balance sheet. Harmony
typically directs its services towards large advertisers and advertising
agencies located in the major markets of New York, Los Angeles, Chicago,
Detroit, Dallas, San Francisco and Minneapolis. In 1998, Harmony had revenues of
approximately $62.0 million.
In March 1999, we acquired Chelsea Pictures, Inc., an entity with
offices in New York and Hollywood. Chelsea produces television commercials,
independent films and related media. In 1998, Chelsea had revenues of
approximately $13.0 million.
Effective as of August 1, 1999, we purchased the Option and Share
Transfer Agreement entered into by Harmony and the four principal executives of
Curious Pictures Corporation, a broadcast commercial production company and
producer of broadcast television programming, from such individuals. As a
result, we acquired 50% of Curious Pictures through the exercise of stock
options and a 1% equity interest owned by the four principal executives of
Curious Pictures. We will now consolidate Curious Pictures as a direct
subsidiary rather than accounting for it within our consolidation of Harmony.
Further, Harmony will begin to account for Curious Pictures as an equity
investment rather than as a consolidated subsidiary. Curious Pictures has
studios in New York and San Francisco. In 1998, Curious Pictures had revenues of
approximately $16.7 million.
Over the last year, we also incorporated two new subsidiaries: Buffalo
Rome Films, Inc. and Populuxe Pictures, Inc. Buffalo Rome seeks out independent
film opportunities. Populuxe, an entity with two directors and an executive
staff in New York, produces television commercials.
TELEVISION COMMERCIAL PRODUCTION
We intend to further expand our television commercial production
business and holdings through acquisitions and opportunities within our present
divisions. We seek to explore the consolidation of commercial production
companies in an effort to increase our commercial production director pool. In
addition, we intend to seek to acquire production service companies, such as
rental, editing, design/marketing, post-production and music companies. We
believe that we can increase gross revenues and profits through the acquisition
of private production companies and related service companies.
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We believe that potential opportunities exist in television commercial
production due to:
* the expanded number of cable television channels;
* advances in digital technology;
* the convergence of short form video content over the Internet;
* the demand for effective advertising concepts; and
* the demand for efficient delivery of production services.
The commercial production industry is fragmented and consists of a
number of privately held companies. Numerous commercial production companies
have limited resources and limited access to major advertisers. As a result,
private independent commercial production companies are unable to adequately
respond to growing demands for high quality and high profile commercial
productions. The demand for high quality service exists due to continued
globalization of advertising clients and the consolidation of production
advertising agencies. We believe compelling arguments exist for consolidation in
this industry.
Our goal is to create a community for creative talent that provides a
highly effective organization, executive producers, integrated production
services, and efficient, cost-effective back-office support. We believe key
talent will recognize that we will provide an environment that fosters
creativity by relieving them and production management of the responsibility of
business and financing operations, while providing a measure of financial
stability. Key talent will also recognize the possibility of us taking a
long-term interest in their career that traditional, independent production
houses typically do not provide.
We intend to consolidate additional commercial production companies and
production service companies, enabling the resulting entity to provide the
highest level of service to our clients. Because many production service
companies produce much higher profit margins than commercial production
companies, the benefits of consolidating both functions include:
* higher overall company profit margins;
* economies of scale;
* centralization of accounting, marketing and sales functions;
and
* the ability to receive more competitive rates from support
service providers.
We currently retain the exclusive services of approximately 60
directors. We believe that this director pool has the video expertise necessary
to meet the growing demand for short form video on the Internet. We intend to
leverage our talent base to explore the convergence of content and technology
over the Internet.
THIS OFFERING
We issued 125,000 of the shares covered by this prospectus to Chelsea's
sole shareholder in connection with an agreement and plan of reorganization
between us, one of our subsidiaries, Chelsea and such shareholder. We issued
warrants to purchase the remaining 300,000 shares covered by this prospectus to
the four principal executives of Curious Pictures as an inducement to enter into
employment agreements with Curious Pictures. The selling shareholders may offer
their shares through public or private transactions, on or off the Nasdaq
National Market, at prevailing market prices or privately negotiated prices. No
period of time has been fixed within which the shares may be offered or sold.
GENERAL
Children's Broadcasting Corporation (d/b/a iNTELEFILM Corporation) was
incorporated under the Minnesota Business Corporation Act on February 7, 1990.
All references to us herein include our subsidiaries, unless otherwise noted.
Our executive office is located at 5501 Excelsior Boulevard, Minneapolis,
Minnesota 55416, and our telephone number is (612) 925-8840.
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RISK FACTORS
BEFORE YOU INVEST IN OUR COMMON STOCK, YOU SHOULD BE AWARE THAT THERE
ARE VARIOUS RISKS, INCLUDING THOSE DESCRIBED BELOW. YOU SHOULD CONSIDER
CAREFULLY THESE RISK FACTORS, AND THE OTHER INFORMATION INCLUDED IN THIS
PROSPECTUS, BEFORE YOU DECIDE TO PURCHASE SHARES OF OUR COMMON STOCK.
OUR NEW VENTURE INTO TELEVISION COMMERCIAL PRODUCTION MAY NOT PROVE
ADVANTAGEOUS OR PROFITABLE. We have changed our business focus from the
programming of children's radio to the production of television commercials and
related media. Although we believe favorable opportunities exist in the
television commercial production industry, the industry is highly fragmented and
we cannot assure you that we will be successful in completing our revised
business plan or, if completed, that the revised business plan will be
advantageous or profitable. We cannot assure you that our competitors will not
try to consolidate commercial production companies and production service
companies. We cannot assure you that consolidation, if it occurs, will be
advantageous or profitable. We do not have any understandings, commitments or
agreements with respect to any future acquisitions. We cannot assure you that we
will consummate future acquisitions or that any acquisitions, if consummated,
will be advantageous or profitable.
WE MAY LOSE MONEY ON OUR INVESTMENT IN HARMONY AND WE HAVE LITTLE
ABILITY TO CUT POTENTIAL LOSSES DUE TO THE ILLIQUID NATURE OF HARMONY'S STOCK.
Through August 31, 1999, we had invested $9.73 million in purchasing Harmony
common stock and had advanced Harmony $3.25 million in cash. Of such advances,
$2.28 million remained outstanding as of August 31, 1999. Our investment in
Harmony's common stock is primarily reflected as goodwill on our consolidated
balance sheet. Our advances to Harmony are eliminated through financial
statement consolidation for reporting purposes. Over the last year, Harmony shut
down Harmony Pictures Inc. and sold 90% of its interest in The End (London),
Ltd., each a former subsidiary, due to continued losses. In February 1999,
Harmony's common stock was removed from listing on the Nasdaq SmallCap Market
and currently trades on the OTC Bulletin Board. We cannot assure you that the
notes receivable will be repaid or that our investment in Harmony will not lose
value or that we will be able to dispose of our Harmony common stock should we
decide to do so. As a result of our acquisition of 51% of Curious Pictures,
Harmony will no longer consolidate Curious Pictures' operating results, which
could have a detrimental effect on Harmony's business, operating results and
financial condition. Any of these events could have an adverse effect on the
market value of our stock.
WE MAY BE UNABLE TO ACQUIRE ADDITIONAL TELEVISION COMMERCIAL PRODUCTION
COMPANIES OR PRODUCTION SERVICE COMPANIES WITHOUT ADDITIONAL FINANCING. The
availability of capital may impact our ability to consummate future acquisitions
as we try to consolidate commercial production companies and production service
companies. There can be no assurance that we will obtain financing when
required, or if available, that the amount or terms of such proceeds would be
acceptable or favorable to us. Additional financing could require the sale of
equity securities which could result in significant dilution to our
shareholders.
TELEVISION COMMERCIAL DIRECTORS AND OTHER KEY PERSONNEL COULD LEAVE US,
IMPAIRING OUR DEVELOPMENT AND PROFITABILITY. We believe that our development and
ability to operate profitably in the television commercial production industry
depend on the hiring and continued engagement or employment of television
commercial directors and other key personnel. While we have entered into various
service agreements with such persons with terms of two to five years, we cannot
assure you that we will be able to retain such talent or that such talent will
fulfill their obligations to us. With the exception of one individual, we do not
maintain life insurance on any of our television commercial directors or other
key personnel.
OUR STOCK IS THINLY TRADED, CREATING POSSIBLE LIQUIDITY PROBLEMS FOR
SHAREHOLDERS WHO SEEK TO SELL. Our common stock is currently listed on the
Nasdaq National Market. We cannot assure you that our common stock will ever be
actively traded on such market or that, if active trading does develop, it will
be sustained.
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OUR STOCK PRICE MAY BE VOLATILE. The market price of our common stock
fluctuates significantly in response to numerous factors, including variations
in our annual or quarterly financial results, changes by financial research
analysts in their estimates of our earnings, conditions in the economy in
general or in the television commercial production industry in particular,
unfavorable publicity or changes in applicable laws and regulations, or judicial
or administrative interpretations thereof, affecting us or the television
commercial production industry. During 1998, the market price of our common
stock ranged from a high of $4.31 on January 7, 1998 to a low of $2.81 on
January 28, 1998 and December 29, 1998. During the first eight months of 1999,
the market price of our common stock ranged from a high of $3.06 on January 12,
1999 to a low of $1.50 on May 28, 1999 and August 10-17, 1999. We cannot assure
you that purchasers of our common stock will be able to sell such stock at or
above the prices at which it was purchased.
THE SALE OF OUR STOCK MAY CAUSE THE MARKET PRICE OF OUR STOCK TO FALL.
We had 6,249,442 shares of common stock outstanding as of August 31, 1999. On
that date, we also had warrants and options outstanding to purchase an
additional 3,829,685 shares of common stock at exercise prices ranging from
$1.63 to $13.80 per share. The sale of the shares covered by this prospectus and
the sale of shares which may become eligible for sale in the public market from
time to time upon the exercise of warrants and options could depress the market
price of our common stock.
WE DEPEND ON MANAGEMENT SERVICES RENDERED BY AN ENTITY WHICH MAY FAVOR
ITS OWN INTERESTS OVER OURS. We share with Harmony management services provided
by employees of an entity owned by Christopher T. Dahl, our President, Chief
Executive Officer and Chairman of the Board, and Richard W. Perkins, one of our
directors. The management services consist of administrative, legal and
accounting services. Such arrangement may present conflicts of interest in
connection with the pricing of services provided.
OUR MANAGEMENT HAS THE ABILITY TO SIGNIFICANTLY AFFECT THE OUTCOME OF
SHAREHOLDER VOTING, INCLUDING THE POSSIBILITY OF TAKING ACTIONS CONTRARY TO THE
PREFERENCES OF SHAREHOLDERS AT LARGE. As of August 31, 1999, approximately 26.3%
of our common stock was beneficially owned by our directors and executive
officers. Accordingly, such persons may exert significant influence over our
business affairs. This concentration of ownership may have the effect of
delaying, deferring or preventing a change in control.
OUR ABILITY TO ISSUE PREFERRED STOCK MAY PREVENT A CHANGE OF CONTROL.
Without any action by our shareholders, the board of directors may issue the
remaining undesignated and unissued authorized shares. The board may also fix
the powers, preferences, rights and limitations of such shares or any class or
series thereof, without shareholders approval. Persons acquiring such shares
could have preferential rights with respect to voting, liquidation, dissolution
or dividends over existing shareholders. We are subject to certain provisions of
the Minnesota Business Corporation Act which limit the voting rights of shares
acquired in "control share acquisitions" and restrict certain "business
combinations." Such provisions, as well as our ability to issue undesignated
shares, could deter or delay a takeover or other change in control, deny our
shareholders the receipt of a premium on their common stock and depress the
market price of our common stock.
OUR ABILITY TO DILUTE UNFRIENDLY POTENTIAL ACQUIRORS MAY PREVENT A
CHANGE IN CONTROL. In February 1998, the board of directors declared a dividend
of one common share purchase right for each share of common stock then
outstanding. Each right will entitle the registered holder to purchase from us,
after the distribution date (as defined in the rights agreement), shares of
common stock at an initial price of $18.00. The rights have certain
anti-takeover effects. The rights will cause substantial dilution to a person or
group that attempts to acquire us without conditioning the offer on a
substantial number of rights being acquired or redeemed. The rights should not
interfere with any merger or other business combination approved by our board
since our board may, at its option and in its sole and absolute discretion,
redeem the rights.
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THE EXISTENCE OF OUR SEVERANCE PLAN MAY PREVENT A CHANGE IN CONTROL OR
A LIQUIDATION OF OUR ASSETS. We have adopted a severance plan which would
provide significant benefits to two executive officers and one non-employee
director following a change in control. Christopher T. Dahl, our President,
Chief Executive Officer and Chairman of the Board, James G. Gilbertson, our
Chief Operating Officer, and Richard W. Perkins, one of our directors, are
eligible to receive lump sum severance payments under the plan. Based upon 1998
annual gross base salaries, the plan participants would receive an aggregate of
approximately $2.0 million following a change in control. The plan also provides
for accelerated vesting of outstanding options and other benefits following a
change in control. The existence of our severance plan could deter or delay a
takeover or other change in control.
YEAR 2000 NON-COMPLIANCE MAY NEGATIVELY AFFECT US. The term "Year 2000"
is used to describe general problems that may result from improper processing of
dates and date-sensitive calculations by computers or other machinery as the
Year 2000 is approached and reached. This problem stems from the fact that many
of the world's computer hardware and software applications have historically
used only the last two digits to refer to a year. As a result, many of these
computer programs do not or will not properly recognize a year that begins with
"20" instead of the familiar "19". If not corrected, this could result in a
system failure or miscalculations which may cause disruptions in operations,
including among other things, a temporary inability to process transactions,
send invoices, or engage in similar business activities.
To operate our business, we rely on certain information technology
("IT") and non-technology systems, including production, payroll, accounts
payable, banking and general ledger systems. We do not maintain any proprietary
IT systems and have not made any modifications to any of the IT systems provided
to us by outside vendors. We have hired an outside IT consultant to assess the
readiness of our hardware and software. This assessment has been completed and
it is anticipated that remediation needed to bring our systems into compliance
will be completed by October 31, 1999. As part of this remediation process, we
replaced our voicemail system during second quarter 1999 at a cost of
approximately $8,000.
We also rely upon certain suppliers and service providers, over which
we can assert little control. We have contacted critical suppliers and service
providers to assess the readiness of such parties and to determine the extent to
which we may be vulnerable to such parties' failure to resolve their own Year
2000 issues. To date, ongoing communications with these parties have not brought
to our attention any material non-compliance issues.
We anticipate that we may incur up to approximately $40,000 in total
costs to bring our systems into Year 2000 compliance. Based on the results of
our assessment, we believe that any future expenses that may be incurred will
not have a material adverse effect on our business, operating results or
financial condition.
We recognize that Year 2000 issues constitute a material known
uncertainty. We also recognize the importance of ensuring that Year 2000 issues
will not adversely affect our operations. We believe that the processes
described above will be effective to manage the risks associated with the
problem. However, we cannot assure you that the processes can be completed on
the timetable described above or that remediation will be fully effective. The
failure to identify and remediate Year 2000 issues, or the failure of key
suppliers and service providers or other critical third parties who do business
with us to timely remediate their Year 2000 issues could cause an interruption
in our business operations. At this time, however, we do not possess information
necessary to estimate the overall potential financial impact of Year 2000
compliance issues.
Specific risks we may face with regard to Year 2000 issues include the
inability of our suppliers and service providers to achieve Year 2000 readiness
which could result in delayed production schedules and may materially adversely
affect our business, operating results and financial condition. The most likely
worst case scenario is that we would be unable to produce television commercials
due to disruptions in the functioning of our production equipment. Our failure
to produce television commercials would result in reduced revenues and cash
flows during the period of disruption and could materially adversely affect our
business, operating results and financial condition.
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We recognize the need for Year 2000 contingency plans in the event that
remediation is not fully successful or that the remediation efforts of our
vendors, suppliers and service providers are not timely completed. We are
currently finalizing our Year 2000 contingency plans.
SPECIAL NOTE REGARDING OUR FORWARD-LOOKING STATEMENTS. Some of the
information in this document may contain forward-looking statements. You can
identify such statements by noting the use of forward-looking terms such as
"believes," "expects," "plans," "estimates" and other similar words. Risks,
uncertainties or assumptions that are difficult to predict may affect such
statements. The risk factors presented above and other cautionary statements
could cause our actual operating results to differ materially from those
expressed in any forward-looking statement. We caution you to keep in mind these
risk factors and other cautionary statements and to refrain from placing undue
reliance on any forward-looking statements, which speak only as of the date of
this document.
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SELLING SHAREHOLDERS
The following table presents information regarding the selling
shareholders. The shares listed below represent the shares which the selling
shareholders owned on August 31, 1999. In the following table, percentage of
beneficial ownership is based on 6,249,442 outstanding shares of common stock.
Unless otherwise indicated, the address of each selling shareholder is 440
Lafayette Street, New York, NY 10003.
<TABLE>
<CAPTION>
PERCENTAGE OF
SHARES OUTSTANDING SHARES
BENEFICIALLY SHARES BENEFICIALLY
OWNED BENEFICIALLY OWNED IF ALL
BEFORE OWNED BEFORE SHARES SHARES ARE SOLD
SELLING SHAREHOLDERS OFFERING OFFERING OFFERED IN THE OFFERING
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<S> <C> <C> <C> <C>
Steve Wax.............................. 125,000 2.0% 125,000 0
122 Hudson Street, Sixth Floor
New York, NY 10013
Susan Holden........................... 75,000 1.2% 75,000 0
Stephen Oakes.......................... 75,000 1.2% 75,000 0
David Starr............................ 75,000 1.2% 75,000 0
Richard Winkler........................ 75,000 1.2% 75,000 0
</TABLE>
SALES TO SELLING SHAREHOLDERS
In March 1999, we acquired Chelsea. In exchange for all of the stock of
Chelsea, we issued 125,000 shares of our common stock to Steve Wax, Chelsea's
sole shareholder. We agreed to issue an additional 75,000 shares to Mr. Wax
contingent upon Chelsea obtaining certain EBITDA levels. We also assumed
approximately $887,000 of Chelsea's liabilities. In connection with this
transaction, Chelsea entered into certain employment and commercial production
director agreements, including a five-year employment agreement with Mr. Wax.
In August 1999, we acquired 51% of Curious Pictures. In exchange for
such interest, we paid Susan Holden, Stephen Oakes, David Starr and Richard
Winkler, the four principal executives of Curious Pictures, $1.5 million in cash
and a promissory note for $1.5 million, bearing interest at 8% per year, due May
31, 2000. In a related transaction, such individuals extended their employment
agreements with Curious Pictures through December 31, 2003, received warrants to
purchase our common stock and received rights to acquire a minority interest in
Curious Pictures and to put their Curious Pictures stock to us upon certain
events. Each of such individuals received a warrant to purchase 75,000 shares of
our common stock at an exercise price of $1.92 per share. Each warrant becomes
exercisable to the extent of 50% of the shares purchasable thereunder on January
1, 2001, provided that the warrant holder is then employed by Curious Pictures.
If the holder of the warrant agrees to extend his or her employment agreement
with Curious Pictures through December 31, 2004, such warrant will become
exercisable as to the remaining 50% of the shares purchasable thereunder on
January 1, 2004. Each warrant expires on December 31, 2004.
SELLING SHAREHOLDERS' REGISTRATION RIGHTS
Under our purchase agreements with the selling shareholders, we agreed
to use our best efforts to register their shares of common stock. Our
registration of the shares does not necessarily mean that the selling
shareholders will sell all or any of the shares covered by this prospectus.
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USE OF PROCEEDS
All of the net proceeds from the sale of the shares will go to the
shareholders who offer and sell their shares. Accordingly, we will not receive
any proceeds from the sale of the shares.
PLAN OF DISTRIBUTION
The selling shareholders may offer their shares at various times in one
or more of the following transactions:
* on the Nasdaq National Market
* in transactions other than on such market
* in privately negotiated transactions, or
* in a combination of any of the above transactions
The selling shareholders may sell their shares at market prices
prevailing at the time of sale, at prices related to such prices, or at
negotiated prices. We are indemnifying the selling shareholders and they are
indemnifying us against certain liabilities.
The selling shareholders may use broker-dealers to sell their shares.
If this happens, such broker-dealers will either receive discounts or
commissions from the selling shareholders, or they will receive commissions from
purchasers of shares for whom they acted as agents.
The selling shareholders and any persons who participate in the sale of
the shares from time to time, may be deemed to be "underwriters" within the
meaning of Section 2(a)(11) of the Securities Act. Any commissions paid or
discounts or concessions allowed to any such persons, and any profits received
on resale of the shares, may be deemed to be underwriting compensation under the
Securities Act.
In order to comply with applicable state securities laws, the shares
will be sold only through registered or licensed brokers or dealers. In
addition, the shares will not be sold until they have been registered or
qualified for sale in the applicable state or an exemption from the registration
or qualification requirement is available.
LEGAL MATTERS
For the purposes of this offering, Jill J. Theis, Esq., our Secretary
and General Counsel, is giving her opinion on the validity of the shares. Ms.
Theis has options to purchase shares of our common stock.
EXPERTS
The consolidated financial statements as of December 31, 1997 and
December 31, 1998 of Children's Broadcasting Corporation, incorporated by
reference in this prospectus, have been audited by BDO Seidman, LLP, independent
certified public accountants, as set forth in their report thereon. Such
consolidated financial statements are incorporated by reference herein in
reliance upon such report given upon the authority of such firm as experts in
accounting and auditing.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information
on the public reference rooms. Our SEC filings are also available to the public
from the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to documents we file with the SEC. The information incorporated by
reference is considered to be part of this prospectus. Information that we file
later with the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings we
will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until the selling shareholders sell all of the
shares covered by this prospectus:
* Annual Report on Form 10-KSB for the year ended December 31,
1998;
* Quarterly Reports on Form 10-QSB for the quarters ended March
31, 1999 (as amended) and June 30, 1999;
* Description of our common stock contained in our Registration
Statement on Form S-2 (No. 33-80721) filed on December 21,
1995 (as amended);
* Current Reports on Form 8-K filed on January 28, 1999,
February 4, 1999, March 8, 1999, April 9, 1999, April 19,
1999, June 7, 1999, July 2, 1999 and August 4, 1999; and
* Definitive Schedule 14A Proxy Statement filed on April 30,
1999 (as revised).
This prospectus is part of a registration statement we filed with the
SEC. You may request a copy of the registration statement or any of the above
filings, at no cost, by writing or telephoning our Chief Operating Officer at
the following address:
Children's Broadcasting Corporation
5501 Excelsior Boulevard
Minneapolis, Minnesota 55416
(612) 925-8840
You should rely only on the information and representations provided in
this prospectus. We have not authorized anyone else to provide you with
different information. No selling shareholder will make an offer of these shares
in any state where the offer is not permitted. You should not assume that the
information in this prospectus is accurate as of any date other than the date on
the front of this document.
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YOU SHOULD RELY ON THE
INFORMATION CONTAINED IN THIS DOCUMENT
OR THAT TO WHICH WE HAVE REFERRED YOU.
WE HAVE NOT AUTHORIZED ANYONE TO
PROVIDE YOU WITH INFORMATION THAT IS 425,000 SHARES
DIFFERENT. YOU SHOULD NOT ASSUME THAT
THE INFORMATION IN THIS DOCUMENT IS
ACCURATE AS OF ANY DATE OTHER THAN THE
DATE ON THE FRONT OF THIS DOCUMENT.
THIS PROSPECTUS IS NOT AN OFFER TO SELL
NOR IS IT SEEKING AN OFFER TO BUY ANY CHILDREN'S BROADCASTING
SECURITIES IN ANY STATE WHERE THE OFFER CORPORATION
OR SALE IS NOT PERMITTED.
COMMON STOCK
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TABLE OF CONTENTS
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PROSPECTUS
Prospectus Summary......................2
Risk Factors............................4 --------------
Selling Shareholders....................8
Use of Proceeds.........................9
Plan of Distribution....................9
Legal Matters...........................9
Experts.................................9
Where You Can Find More Information....10
September 24, 1999
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