<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 20, 2000
REGISTRATION NO. 333-____
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
IMAGINON, INC.
(Exact name of Registrant as specified in its charter)
Delaware 7372 84-1217733
(State or other jurisdiction of (Primary Standard (IRS Employer
incorporation or organization) Industrial Code) Identification No.)
1313 Laurel Street
San Carlos, California 94070
(650) 596-9300
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)
David M. Schwartz
President, Chairman and Chief Executive Officer
1313 Laurel Street
San Carlos, California 94070
(650) 596-9300
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies of all correspondence to:
John W. Kellogg, Esq.
RaLea A. Sluga, Esq.
Friedlob Sanderson Paulson & Tourtillott, LLC
1400 Glenarm Place, Suite 300
Denver, Colorado 80202
(303) 571-1400
--------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to
time after the effective date of this Registration Statement as determined by
market conditions.
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [_]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [X]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check this following box and
list the Securities Act registration number of the earlier effective
registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
<PAGE>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
----------------------------------------------------------------------------------------------------------
TITLE OF EACH CLASS OF SECURITIES TO AMOUNT TO BE PROPOSED PROPOSED AMOUNT OF
BE REGISTERED REGISTERED(1) MAXIMUM MAXIMUM REGISTRATION
OFFERING PRICE AGGREGATE FEE
PER SHARE(2) OFFERING PRICE
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 3,875,984 $.3438 $1,332,564 $ 352
----------------------------------------------------------------------------------------------------------
Common Stock issuable upon the 16,000,000(3) $.3438 $5,500,800 $1,452
conversion of Series G Convertible
Preferred Stock
----------------------------------------------------------------------------------------------------------
TOTAL 19,875,984 $6,833,364 $1,804
----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to Rule 457(c), the average of the bid and ask price of ImaginOn,
Inc. common stock as quoted on the NASDAQ SmallCap Market on November 16,
2000 was $.3438.
(2) Pursuant to Rule 457(g), the proposed maximum offering price per share of
common stock is $.3438.
(3) Pursuant to the registration rights agreement between ImaginOn and the
investors in the Series G Convertible Preferred Stock private placement, we
are required to register 200% of aggregate number of shares into which the
Series G Convertible Preferred Stock may be converted at the time of this
filing. The conversion price at the time of filing is $.2750, which is 80%
of the average of the closing bid prices of our commom stock over the
immediately preceding five consecutive trading days.
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<PAGE>
Subject to Completion; Prospectus dated November 20, 2000
[LOGO]
1313 Laurel Street
San Carlos, CA 94070
19,875,984 shares of common stock
This prospectus relates to the proposed resale from time to time of up to
19,875,984 shares of our common stock by the selling securityholders. We will
not receive any of the proceeds from the sale of these securities.
The selling securityholders listed on page 8 are offering:
. 3,875,984 shares of common stock
. 16,000,000 shares of common stock issuable upon the conversion of
outstanding shares of our Series G 8% Convertible Preferred Stock
The selling securityholders may sell all or any portion of their shares of
common stock in one or more transactions on the NASDAQ SmallCap Market or in
private, negotiated transactions. The selling securityholders will pay all
selling expenses, including any brokerage commissions. ImaginOn will pay the
registration fee.
Our common stock trades on the NASDAQ SmallCap Market under the symbol
"IMON." On November 16, 2000, the last reported sale price of our common stock
was $.3438 per share.
We may amend or supplement this prospectus from time to time by filing
amendments or supplements as required. You should read this entire prospectus
and any amendments or supplements carefully before you make your investment
decision.
See "Risk Factors" starting on page 3 to read about material risks you
should consider before you purchase shares of our common stock.
___________________
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is
a criminal offense.
___________________
Prospectus dated November 20, 2000.
<PAGE>
TABLE OF CONTENTS
Section Page
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Risk Factors................................................. -3-
Where You Can Find Additional Information.................... -6-
Forward-looking Statements................................... -7-
Information About ImaginOn, Inc.............................. -7-
Recent Developments.......................................... -8-
Use of Proceeds.............................................. -8-
Description of Securities.................................... -8-
Selling Securityholders...................................... -8-
Plan of Distribution......................................... -9-
Indemnification Provided in Connection with the Offering..... -10-
Legal Matters................................................ -11-
Experts...................................................... -11-
<PAGE>
Risk Factors
You should carefully consider the risk factors listed below and the other
information contained in this prospectus before purchasing our common stock.
Investing in our common stock and warrants involves a high degree of risk. Any
or all of the risks listed below could have a material adverse effect on our
business, operating results or financial condition, which could cause the market
price of our stock to decline, in which event you could lose your investment in
our common stock. You should also keep these risk factors in mind when you read
forward-looking statements. We have identified all of the material risks which
we believe may affect our business and the principal ways in which we anticipate
that they may affect our business or financial condition.
Risks Relating to Our Business
------------------------------
We have little relevant operating history to evaluate performance or prospects.
Prior to the fourth quarter of 1999, we considered ourselves to be a
development stage company, and engaged primarily in research and development
activities, raising capital, acquiring businesses and recruiting personnel. In
the fourth quarter of 1999, we began selling our broadband Internet television
software systems, which we developed in conjunction with technologies and
resources obtained in part through our business. We also completed a $6,000,000
private placement of our common stock and warrants. While as a result of these
events, beginning in the fourth quarter of 1999, we no longer consider ourselves
to be a development stage company, we have little relevant operating history
upon which we can evaluate our performance and prospects. We face all the risks
common to companies in their early stage of development, including:
. undercapitalization;
. cash shortages;
. high capital expenditures;
. unproven business model;
. difficulties in managing rapid growth; and
. lack of sufficient customers, revenue and cash flow.
Although our personnel have experience in developing and commercializing
new products based on innovative technologies, unanticipated expenses, problems
or technical difficulties could occur which would result in material delays in
product commercialization. Our efforts may not result in successful product
commercialization.
Our securities may be de-listed from the Nasdaq SmallCap Market causing our
liquidity to decrease.
We have received notice from Nasdaq that our net tangible assets are below
the required minimum for listing on the Nasdaq SmallCap Market. Nasdaq is
reviewing our plan to achieve and sustain compliance with the minimum net
tangible assets requirement. In addition, we have received notice from Nasdaq
that our common stock's minimum bid price has fallen below the required $1.00
per share. We have until December 26, 2000 to regain compliance with the minimum
bid price requirement. Although we have no plans to enter into an agreement that
would obligate us to issue an aggregate of more than 20% of our common stock
outstanding without stockholder approval, if we do enter into such an agreement,
our securities could be de-listed from the Nasdaq SmallCap Market. If our
securities are de-listed from the Nasdaq SmallCap Market, the price of our
Common Stock may be quotes on either the electronic bulletin board or on pink
sheets. This would make it more difficult for securityholders to sell their
shares of our common stock on the market and would decrease our liquidity.
We have outstanding convertible securities that may cause substantial dilution
to holders of our common stock.
The conversion terms of our outstanding Series G 8% Convertible Preferred
Stock may cause substantial dilution in the book value per share of our common
stock. The conversion feature in the Series G 8% Convertible Preferred Stock
allows the selling securityholder to purchase increasing shares of common stock
as a result of a decreasing market price of our common stock price including but
not limited to the following circumstances:
. To the extent that the selling securityholder converts or exercises
and then sells common stock, the common stock price may decrease due
to the additional shares in the market. This could allow the selling
securityholder to convert or exercise remaining Series G 8%
Convertible Preferred Stock into greater amounts of common stock, the
sales of which would further depress the stock price.
. The significant downward pressure on the price of the common stock
could encourage short sales and consequently place further downward
pressure on the price of the common stock.
. Although we require that holders of our Series G 8%Convertible
Preferred Stock own no more than 9.999% of our currently outstanding
shares of common stock, it is possible for holders of our Series G 8%
Convertible Preferred Stock to circumvent this restriction. By
converting an amount of Series G 8% Convertible Preferred Stock equal
to 9.999% of our currently outstanding shares of common stock, then
selling the securities into the market and then converting another
block of Series G 8% Convertible Preferred Stock into common stock,
holders of our Series G 8% Convertible Preferred Stock create
additional dilution to the existing holders of our common stock.
. We are required to redeem any shares of Series G 8% Convertible
Preferred Stock at 125% of the stated value of such shares if their
conversion would exceed 19.9% of our issued and outstanding shares of
common stock on the date of our purchase agreement with the Series G
8% Convertible Preferred Stock investors, which was 8,932,233 shares
of common stock.
. The conversion of the Series G 8% Convertible Preferred Stock may
result in substantial dilution to the interests of other holders of
common stock.
Since we cannot know the conversion price of the Series G 8% Convertible
Preferred Stock until notice of conversion has been provided by the selling
securityholder, we cannot currently determine how many shares of common stock we
will need to issue upon conversion of the Series G 8% Convertible Preferred
Stock. However, pursuant to the registration rights agreement we are required to
register 200% of the shares of our common stock convertible from the Series G 8%
Convertible Preferred Stock, which at the current conversion price is 16,000,000
shares of common stock. For examples of the number of shares issuable upon
certain changes in the conversion price see "Description of securities" on
page 9.
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We will need additional capital to fund operations.
We will require additional financial resources to fund our new product
development and growth. Although we are actively exploring options for funding,
we have received no commitment from any person or source for that financing, and
adequate financing may not be available on reasonable terms. Our failure to
acquire additional funding when required could impede new product development
and growth and, ultimately, our performance and prospects.
Our earnings growth is dependent upon acceptance of our products.
Our earnings growth depends primarily upon market acceptance of our
software products. Our products may not be able to be successfully marketed or
achieve customer acceptance.
Our success depends on the introduction of new products and product
enhancements.
Our success in the software development business is heavily dependent upon
the timely introduction of successful new products or enhancements of existing
products to replace declining revenues from products at the latter stage of a
product cycle. Consumer preferences for software products are difficult to
predict, and few consumer software products achieve sustained market acceptance.
If revenue from new products or enhancements does not replace declining revenues
from existing products, we may experience:
. lower operating revenues
. lower net revenues
. lower cash flows
. less liquidity
Production delays could inhibit our success.
The process of developing our software products is extremely complex. A
significant delay in the introduction of one or more new products or
enhancements could have a material adverse effect on the ultimate success of
such products and we may experience:
. lower operating revenues
. lower net revenues
. lower cash flows
. less liquidity
We operate in a developing market with increasing participants.
The market for Internet products and computer software is rapidly evolving
and is characterized by an increasing number of market entrants who have
introduced or developed products and services. Although we believe that the
diverse segments of the Internet market will provide opportunities for more than
one supplier of products and services similar to those we possess, it is
possible that a single supplier may dominate one or more market segments.
Additionally, there may be insufficient market acceptance of our products
because the market for Internet products and computer software changes rapidly.
We are heavily dependent on our management.
Our success depends upon the personal efforts of our President and Chief
Executive Officer, David M. Schwartz. The loss of the services of Mr. Schwartz
could have a material adverse effect on our business and prospects. We do not
have "key-person" life insurance on Mr. Schwartz.
-4-
<PAGE>
Our success is linked to our ability to hire and maintain personnel.
Our success depends on our ability to hire and retain additional qualified
management, marketing, technical, financial and other personnel. Competition
for qualified personnel is intense and we may not be able to hire or retain
qualified personnel.
We are dependent on contracts with other companies for promotion of our products
and reputation.
We have entered into agreements and informal relationships with other
software and computer companies under which the companies will use our products.
We believe these arrangements are important to the promotion of our products and
the public recognition of the "ImaginOn" name. These arrangements typically are
not exclusive, and may be terminable upon little or no notice. Termination or
alteration of these agreements could have any of the following effects on us:
. limit or eliminate the market for our products
. limit or eliminate public recognition of the "ImaginOn" name
. reduce revenues
. lower cash flows
. impair liquidity
We regard our patented technology as proprietary.
Our success and ability to compete is dependent on our proprietary
technology. We regard our technology as proprietary and we rely primarily on
U.S. patent, trademark, copyright, trade secret laws, third-party non-disclosure
agreements and other methods to protect our proprietary rights. The steps taken
by us to protect our proprietary rights may not be adequate and third parties
may infringe or misappropriate our copyrights, trademarks, and similar
proprietary rights. Additionally, effective trademark, patent, copyright and
trade secret protection may not be available in every country in which our
products and media properties will be distributed or made available through the
Internet.
Risks Related to the Internet and the Internet Industry
-------------------------------------------------------
We face significant competition from other providers of Internet products and
computer software.
The markets that we intend to enter for our Internet products and computer
software are characterized by intense competition and an increasing number of
new market entrants who have developed or are developing potentially competitive
products. Further, the cost barriers to these markets are relatively low, which
means our competitors range from small companies with limited resources to
large, more established companies. Some competitors, regardless of size, have
substantially greater financial, technical, marketing, distribution, personnel
and other resources. For example, current and future competitors with greater
financial resources than us may be able to carry larger inventories, undertake
more extensive marketing campaigns, adopt more aggressive pricing policies and
make higher offers or guarantees to software developers and co-development
partners than us. It is possible that we may not have the resources to
withstand these and other competitive forces.
We may become subject to government regulation.
We are not currently subject to direct regulation by any government agency
in the United States, other than general business regulations applicable to
conduct businesses generally. Currently there are few laws or regulations
regarding access to or commerce on the Internet. Due to the increasing
popularity and use of the Internet, laws and regulations may be adopted with
respect to the Internet, covering issues such as user privacy, pricing and
characteristics and quality of products and services. These laws or
regulations, if adopted, could also limit the growth of the Internet, which
could, in turn, decrease the demand for our proposed products and services and
increase our cost of doing business. Inasmuch as the applicability to the
Internet of the existing laws governing issues such as property ownership, libel
and personal privacy is uncertain, any new legislation or regulation or the
application of existing laws and
-5-
<PAGE>
regulations to the Internet could have an adverse effect on our business and
prospects.
We could be held liable for some of our services.
Because materials may be downloaded by the online or Internet services
operated or facilitated by us and may be subsequently distributed to others,
there is a potential that claims will be made against us for defamation,
negligence, copyright or trademark infringement, personal injury or other
theories based on the nature and content of these materials. These types of
claims have been brought, and sometimes successfully pressed, against online
service providers. Although we carry general liability insurance, our insurance
may not cover potential claims of this type or may not be adequate to indemnify
us for all liability that may be imposed. Any impositions of liability or legal
defense expenses are not covered by insurance or in excess of insurance coverage
could effect our revenues, cash-flow and/or liquidity.
Where You Can Find Additional Information
Federal securities law requires ImaginOn to file information with the
Securities and Exchange Commission concerning its business and operations.
Accordingly, we have filed with the SEC annual, quarterly and special reports,
proxy statements and other information made with the Commission. You can
obtain a copy of registration statements, reports and the exhibits through the
SEC, at the SEC's public reference rooms at 450 Fifth Street, N.W., Washington,
D.C. 20549, Seven World Trade Center, 13/th/ Floor, New York, New York, 10048
and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661, or the SEC's website at http://www.sec.gov. Please call the SEC at 1-
-------------------
800-SEC-0330 for further information on the public reference rooms and their
copy charges.
We have furnished our stockholders with annual reports containing
financial statements audited by our independent auditors. We will also file
annual, quarterly and current reports, proxy statements and other information
with the SEC. You can also request copies of these documents, for a copying
fee, by writing the SEC.
Our common stock is traded as "SmallCap Market Securities" on the Nasdaq
SmallCap Market. Material filed by us can be inspected at the offices of the
National Association of Securities Dealers, Inc., Reports Section, 1735 K
Street, N.W., Washington, D.C. 20006.
The Commission allows ImaginOn to "incorporate by reference" the
information we file with them, which means we can disclose important information
to you by referring you to the other information we have filed with the
Commission. The information that we incorporate by reference is considered to
be part of this prospectus, and related information that we file with the
Commission will automatically update and supersede information we have included
in this prospectus. We also incorporate by reference any future filings we make
with the Commission under Sections 13(a), 13(c) or 15(d) of the Securities
Exchange Act of 1934, as amended, until the selling securityholders sell all of
their shares or until the registration rights of the selling securityholders
expire.
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 this offering has been completed:
. Our Annual Report on Form 10-K for the year ended December 31, 1999.
. Our Quarterly Report on Form 10-QSB for the quarter ended March 31,
2000.
. Our Quarterly Report on Form 10-QSB for the quarter ended June 30,
2000.
. Our Quarterly Report on Form 10-QSB for the quarter ended September
30, 2000
. Our Definitive Proxy Statement on Schedule 14A filed on March 16,
2000.
. The description of our common stock set forth in our Registration
Statement on Form S-1 filed on October 8, 1999.
You may request free copies of any filing by writing or telephoning us at
our principal offices, which are located at the following address:
1313 Laurel Street
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<PAGE>
San Carlos, CA 94070
(650) 596-9300
Attn: Secretary
Forward-Looking Statements
Certain statements under the captions "Summary," "Risk Factors," "Use of
Proceeds," "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and "ImaginOn, Inc." and elsewhere in this prospectus are
"forward-looking statements." These forward-looking statements include, but are
not limited to, statements about our plans, objectives, expectations, prospects
and intentions, markets in which we participate and other statements contained
in this prospectus that are not historical facts. When used in this prospectus,
the words "expect," "project," "anticipate," "believe," "estimate," "intend,"
"plan," "seek" and similar expressions are generally intended to identify
forward-looking statements. Because these forward-looking statements involve
risks and uncertainties, there are important factors that could cause actual
results to differ materially from those expressed or implied by these forward-
looking statements, including changes in our plans, objectives, expectations,
prospects and intentions and other factors discussed under "Risk Factors" and
elsewhere in this prospectus. We cannot guarantee any future levels of
activity, performance or achievements. We will update these forward-looking
statements, to the extent required by law, to reflect material changes in the
information previously disclosed.
Information About ImaginOn, Inc.
Our Mission
-----------
Our objective is to deliver Internet television to everyone who wants to
communicate, entertain, inform, educate or market in a new way, in a new era.
About Us
--------
We are an information technology company focused on developing and
marketing broadband Internet television systems to businesses and institutions.
Our Internet television system, ImOn.comTV, is a licensed turnkey package that
enables any website to present interactive television within a standard browser
window on any suitably connected computer. Web sites are places on the
Internet. Every web page has a location where it resides which is called its
site and every site has an address usually beginning with "http://." The
ImOn.comTV interactive "virtual console" offers its users video on demand, video
that branches under user command, automated Web searching, and many additional
features, customized for each licensee.
David Schwartz and Leonard Kain started ImaginOn in 1996 to develop better
ways for businesses and consumers to take advantage of the Internet and personal
computers. Originally, the Internet was called ARPANET after the Advanced
Research Projects Agency of the U.S. Department of Defense. This electronic
network, which is a multi-dimensional set of items and the connections between
them, connects the network host computers together so that a user may go from
one Web Page to another efficiently. This electronic connection network began
as a government experiment in 1969 with four computers connected together over
phone lines. By 1972, universities also had access to what was by then called
the Internet. On January 20, 1999, ImaginOn became a public company by
completing a merger with California Pro Sports, Inc., "CALP", in which their
shareholders retained 40% ownership of the merged entity and no representation
on our Board of Directors. All business operations of CALP were discontinued
prior to the merger and the name was changed to ImaginOn, Inc. ImaginOn
currently trades on the Nasdaq SmallCap Market under the symbol "IMON".
The software technology invented by our founders is the subject of two U.S.
patents. The primary functions of our applications are authoring media
intensive data and interactive playback of media intensive data. On the
authoring side, we enable automated data collection and organization, manually
guided collection and organization, or a combination of automated and manual
operations. Our authoring software is used to create Internet TV content. On
the playback side, we enable access and manipulation of interactive high
bandwidth streaming video. A stream is digital
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<PAGE>
data that is transmitted or delivered as a continuous flow of information within
a channel. The stream may or may not have a fixed duration. Examples of streams
are digitized audio and digitized video. To view or hear something in real-time
means to see or hear it immediately and without any slowdowns. Real-time audio
on the Internet, for example, means the user does not have to wait an entire
audio file to download, but can, almost immediately, start listening to the
audio as it is coming to them. Our media playback features interactivity that
goes beyond simple click-throughs. Real-time seamless branching of video
streams, and simultaneous real-time seamless integration of Web research data
within Internet TV, are fundamentally new features created by us.
Recent Developments
On October 19, 2000, we completed the sale of 15 shares of our Series G 8%
Convertible Preferred Stock to Bess Holdings Limited and Resonance Limited for
cash consideration of $1.5 million. In addition, on October 30, 2000, we
completed the sale of 7 shares of our Series G 8% Convertible Preferred Stock to
Gage LLC for cash consideration of $700,000. The proceeds from these
transactions were used for working capital, $120,000 was paid to The Tail Wind
Fund Ltd. and $80,000 was paid to Resonance Limited for accrued damages for late
registration of certain Common Stock pursuant to the Registration Rights
Agreement dated December 30, 1999 by and among us and the investors named
therein, and $466,683 was paid to Gage LLC for accrued damages for late
registration of certain Common Stock pursuant to the Registration Rights
Agreement dated May 4, 1999 by and among us and Gage LLC.
Provisions in the purchase agreements for the December 1999 private
placement provide that if we issue stock to another investor upon terms more
favorable than those in the December 1999 private placement, we are obligated to
issue shares of our common stock to the investors in our December 1999 private
placement to equal the more favorable terms. In compliance with these provisions
as a result of the October private placements, we have issued 1,291,994 shares
of our common stock to Southshore Capital Fund Limited, 3,875,984 shares of our
common stock to The Tail Wind Fund Ltd. and 2,583,989 shares of our common stock
to Resonance Limited. We are obligated to register 50% of these anti-dilution
shares of common stock in this offering and the other 50% by June 2001.
Use of Proceeds
We will not receive any proceeds from the sale of the shares of common
stock being sold by the selling securityholders.
Description of Securities
Common stock
We are authorized to issue up to 100,000,000 shares of common stock, $.01
par value per share. As of November 16, 2000, 52,434,618 shares are
outstanding. All outstanding shares of common stock are fully paid and non-
assessable, and all shares of common stock offered in the offering, when issued,
will be fully paid and non-assessable. The holders of our common stock:
. have equal ratable dividends from funds legally available, when and
if declared by our Board of Directors;
. are entitled to share ratably in all our assets available for
distribution to holders of common stock upon liquidation, dissolution
or winding up of our affairs;
. do not have preemptive, subscription or conversion rights and there
are no redemption or sinking fund provisions applicable thereto; and
. are entitled to one vote per share on all matters on which
stockholders may vote at all meetings of stockholders.
The holders of our common stock do not have cumulative voting rights, which
means that the holders of a majority of the outstanding shares represented at
any stockholder meeting at which a quorum is present, voting for the election of
directors, can elect all of the directors to be elected, if they so choose and,
in such event the holders of the remaining shares will not be able to elect any
of the directors.
Preferred stock
We are authorized to issue up to 5,000,000 shares of preferred stock with
such designations, rights and preferences as may be determined from time to time
by the Board of Directors. Accordingly the Board of Directors is empowered,
without stockholder approval, to issue preferred stock with dividend,
liquidations, conversion, voting or other rights that adversely affect the
voting powers or other rights of our common stockholders. Currently there are 22
shares of Series G 8% Convertible Preferred Stock issued and outstanding.
Series G 8% Convertible Preferred Stock
On October 19, 2000, we completed the sale of 15 shares of our Series G 8%
Convertible Preferred Stock to Bess Holdings Limited and Resonance Limited for
consideration of $1,500,000. In addition, on October 30, 2000, we completed the
sale of 7 shares of our Series G 8% Convertible Preferred Stock to Gage LLC for
consideration of $700,000. The proceeds from these transactions were used for
working capital, $120,000 was paid to The Tail Wind Fund Ltd. and $80,000 was
paid to Resonance Limited for accrued damages for late registration of certain
Common Stock pursuant to the Registration Rights Agreement dated December 30,
1999 by and among us and the investors named therein, and $466,683 was paid to
Gage LLC for accrued damages for late registration of certain Common Stock
pursuant to the Registration Rights Agreement dated May 1999 by and among us and
Gage LLC. In connection with the private placement, Aryeh Trading received
$75,000 as a finder.
Conversion of preferred stock into common stock can only occur by
submitting a Notice of Conversion and the stock certificate representing the
Series G 8% Convertible Preferred Stock to be converted. The holders of Series
G 8% Convertible Preferred Stock may convert any number of the Series G 8%
Convertible Preferred Stock into common stock provided that:
. holders of Series G 8% Convertible Preferred Stock do not currently
or as a result of such conversion, own more than 9.999% of the then
outstanding shares of common stock. However, it is possible for
holders of our Series G 8% Convertible Preferred Stock to circumvent
this restriction. By converting an amount of Series G 8% Convertible
Preferred Stock equal to 9.999% of our currently outstanding shares of
common stock, then selling the securities into the market and then
converting another block of Series G 8% Convertible Preferred Stock
into common stock, holders of our Series G 8% Convertible Preferred
Stock create additional dilution to the existing holders of our common
stock.
The conversion ratio for issuing shares of our common stock in exchange for
Series G 8% Convertible Preferred Stock is determined by dividing the stated
value of the Series G 8% Convertible Preferred Stock by the conversion price.
The conversion price will be the lowest of:
. $.60; or
. 80% of the average of closing bid prices of our common stock over the
immediately preceding five consecutive trading days preceding the
conversion date.
In no event, can the conversion price be less than $.10.
For example and for illustrative purposes only, if the conversion date is
November 17, 2000, the average of the closing bid prices of our common stock
over the immediately preceding five consecutive trading days is $.3438, 80% of
$.3438 is $.2750. Therefore, the lower of $.60 and $.2750 is $.2750 and is the
conversion price.
The following table sets forth, for illustrative purposes only, the effect
of decreasing stock prices and its result on the conversion price per share and
number of shares issued upon conversion of the Series G 8% Convertible Preferred
Stock.
<TABLE>
<CAPTION>
Aggregate number of shares of
Price per share common stock convertible from all
of common Conversion price Series G 8% Convertible Preferred Percentage of outstanding
stock (1) Stock(2) common stock(3)
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$.3438 $.2750 8,000,000 15.25%
-------------------------------------------------------------------------------------------------------------
$.2578(4) $.2062 8,932,233(8) 17.03%
-------------------------------------------------------------------------------------------------------------
$.1719(5) $.1375 8,932,233(8) 17.03%
-------------------------------------------------------------------------------------------------------------
$.4298(6) $.3438 6,399,070 12.20%
-------------------------------------------------------------------------------------------------------------
$.5157(7) $.4125 5,333,334 10.17%
-------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The conversion price is the lesser of (a) $.60 (b) 80% of the average of
closing bid prices of our common stock over the immediately preceding five
consecutive trading days preceding the conversion date.
(2) Assumes that all 22 shares of Series G 8% Convertible Preferred Stock,
which have a stated value of $2,200,000, will be converted into common
stock and there have been no prior conversions of the Series G 8%
Convertible Preferred Stock.
(3) Assumes 52,434,618 outstanding shares of our common stock prior to the
conversion of the Series G 8% Convertible Preferred Stock.
(4) Reflects a 25% reduction from the average closing bid price of $.3438.
(5) Reflects a 50% reduction from the average closing bid price of $.3438.
(6) Reflects a 25% increase from the average closing bid price of $.3438.
(7) Reflects a 50% increase from the average closing bid price of $.3438.
(8) Pursuant to restrictions in the Certificate of Designations, Preferences
and Rights of Series G 8% Convertible Preferred Stock, we are restricted
from issuing more than 8,932,233 shares of our common stock without
shareholder approval. If we are unable to obtain shareholder approval for
the issuance of the shares over the 8,932,233 limit, we are required to
redeem the excess shares of Series G 8% Convertible Preferred Stock at 125%
of the aggregate stated value of the redeemed shares plus all accrued and
unpaid dividends.
However, the number of shares of our common stock is subject to adjustment
in each of the following cases:
. stock dividend;
. declaration of dividends payable in cash while offering a right to
purchase more common stock at the dividend price;
. stock split;
. combination of outstanding shares of common stock;
. issue or reclassify common stock;
. consolidation, merger, sale or lease of substantially all of our
assets; or
. capital reorganization or reclassification of common stock.
The Holder of the Series G 8% Convertible Preferred Stock may request
redemption of their shares of Series G 8% Convertible Preferred Stock by us
provided one of the following triggering events occurs:
. the registration statement to register the underlying shares of common
stock for the Series G 8% Convertible Preferred Stock fails to be
declared effective by the Securities and Exchange Commission by
February 16, 2001 without a review by the Securities and Exchange
Commission or by March 18, 2001 if there is a review by the Securities
and Exchange Commission; or
. if sales cannot be made pursuant to the registration statement for any
reason that is not excused for longer than 180 days; or
. we fail to deliver stock certificates represented the common stock by
the tenth trading day after the date of conversion or we provide
notice that we will not comply with requests for conversion of any
shares of Series G 8% Convertible Preferred Stock; or
. we are a party to any change of control transaction and agree to sell
more than 33% of our assets; or
. we fail to have available a sufficient number of authorized and
unreserved shares of common stock to issue to the holder upon
conversion of the Series G 8% Convertible Preferred Stock; or
. we fail to observe or perform any material convenant, agreement or
warranty contained in the purchase agreement or registration rights
agreement for the Series G 8% Convertible Preferred Stock and such
failure if not cured within twenty business days after the date of
written notice of such failure.
The redemption price is subject to adjustment of the conversion price in
the event of a stock split, stock dividend or combination of shares or similar
event. The redemption price is 125% of the aggregate stated value of the
redeemed shares plus all accrued and unpaid dividends and the product of the
number of all shares of common stock issued in conversions of Series G 8%
Convertible Preferred Stock to the holder not more than twenty trading days
prior to the event causing the redemption and the per share closing bid price on
the date such redemption is demanded or the date the redemption price is paid in
full, whichever is greater.
As long as Series G 8% Convertible Preferred Stock is outstanding, we are
required to reserve and keep available out of our authorized but unissued common
stock no less that 200% of the number of shares of common stock convertible from
the Series G 8% Convertible Preferred Stock. A majority vote of the Series G 8%
Convertible Preferred Stockholders is required to amend our Certificate of
Incorporation if such amendment does any of the following:
. alter or amend the rights of the holders of the Series G 8%
Convertible Preferred Stock or the Certificate of Designations,
Preferences and Rights of Series G 8% Convertible Preferred Stock; or
. authorize or create any class of stock senior to the Series G 8%
Convertible Preferred Stock as to dividends or distribution of assets
upon a liquidation.
Registration rights
Under the registration rights agreement, we are obligated to register 200%
shares of common stock which may be issued upon conversion of the Series G 8%
Convertible Preferred Stock. We are fulfilling our obligations under the
registration rights agreement with this registration statement and prospectus.
Selling Securityholders
The following table lists the securities to be registered and offered for
sale by the selling securityholders including the total number of shares to be
registered by this registration statement. The term "selling securityholders"
include donees, pledgees, transferees and other successors in interest selling
shares received from the selling securityholders after the date of this
prospectus.
Because the selling securityholders may offer all or part of the shares of
common stock owned by them or received upon conversion of the Series G Preferred
Stock and because this offering is not being underwritten on a firm commitment
basis, no estimate can be given as to the number of shares of common stock that
the selling securityholders are going to sell. The shares of common stock
offered by this prospectus may be offered from time to time by the selling
securityholders.
Three of the selling securityholders acquired their securities in the
private placements of our Series G 8% Convertible Preferred Stock completed on
October 19 and October 30, 2000. See "Recent Developments," above.
Provisions in the purchase agreements for the December 1999 private
placement provide that if we issue stock to another investor upon terms more
favorable than those in the December 1999 private placement, we are obligated to
issue shares of our common stock to the investors in our December 1999 private
placement to equal the more favorable terms. In compliance with these
provisions, as a result of the October private placements, we have issued
1,291,994 shares of our common stock to Southshore Capital Fund Limited,
3,875,984 shares of our common stock to The Tail Wind Fund Ltd. and 2,583,989
shares of our common
-8-
<PAGE>
stock to Resonance Limited. We are obligated to register 50% of these anti-
dilution shares of common stock in this offering and the other 50% by June 2001.
Shares of Common Stock and Shares of Common Stock Underlying Shares of Series G
-------------------------------------------------------------------------------
8% Convertible Preferred Stock Offered by the Selling Securityholders
---------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares of Percent of
Shares of Shares of common stock Total Amount of outstanding
common common stock received upon shares of common common
stock owned to be the conversion common stock stock owned stock owned
Selling owned offered for of Series G 8% to be offered for by by
securityholder prior to securityholder's Convertible securityholder's securityholder securityholder
name offering account Preferred Stock account after the after the
to be offered for offering (2) offering (2)
securityholder's
account(1)
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Bess Holdings 0 0 10,327,273 10,327,273 0 0
Limited
-------------------------------------------------------------------------------------------------------------------------
Gage 0 0 5,090,909 5,090,909 0 0
-------------------------------------------------------------------------------------------------------------------------
Resonance 2,583,989 1,291,995 581,818 1,873,813 2,583,989 4.93%
Limited
-------------------------------------------------------------------------------------------------------------------------
Southshore 0 645,997 0 645,997 0 0
Capital Fund
Limited
-------------------------------------------------------------------------------------------------------------------------
The Tail Wind 0 1,937,992 0 1,937,992 0 0
Fund Ltd.
-------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to the registration rights agreement between us and the investors
in the Series G 8% Convertible Preferred Stock private placement, we are
required to register 200% of aggregate number of shares into which the
shares of Series G 8% Convertible Preferred Stock may be converted at the
time of this filing. The conversion price at the time of this filing is
$.2750, which is 80% of the average of the closing bid prices of our common
stock over the immediately preceding five consecutive trading days.
(2) Assumes all shares offered are sold, including shares of common stock
underlying the conversion of Series G Preferred Stock and there are
52,434,618 outstanding shares of our common stock.
Plan of Distribution
We are registering the shares offered by the selling securityholders and no
underwriters are participating in this offering.
We will pay all costs and expenses in connection with the preparation of
this prospectus and the registration of the shares. Brokerage commissions and
similar selling expenses, if any, attributable to the sale of shares will be
borne by the selling securityholders. The selling securityholders may sell
their shares from time to time in one or more types of transactions, which may
include block transactions, on the Nasdaq SmallCap Market. The types of
transactions include:
-9-
<PAGE>
. negotiated transactions;
. put or call option transactions;
. short sales; or
. a combination of the above transaction at market prices at the time of
sale or at negotiated prices.
These transactions may or may not involve brokers or dealers. The selling
securityholders have advised us that they have not entered into any agreements,
understandings or arrangements with any underwriters or broker-dealers regarding
the sale of the shares, nor is there an underwriter or coordinating broker
acting in connection with the proposed sale of shares by the selling
securityholders.
Pursuant to the Purchase Agreements dated October 19, 2000, between us and
Bess Holdings Limited and Resonance Ltd. and the Purchase Agreement dated
October 30, 2000 between us and Gage LLC, Bess Holdings Limited, Resonance Ltd.
and Gage LLC may not own more than 19.9% of our issued and outstanding shares
of common stock. We must redeem their excess shares at 125% of the value of the
shares of Series G 8% Convertible Preferred Stock to reduce the number of shares
of common stock to a number below the 19.9% limit.
In addition, the Certificate of Designations, Preferences and Rights of
Series G 8% Convertible Preferred Stock precludes us from issuing more than
8,932,233 shares of common stock upon conversion of the Series G 8% Convertible
Preferred Stock and requires that we obtain, within 75 days of conversion,
shareholder approval to issue more than 8,932,233 shares of common stock. If we
do not obtain shareholder approval within 75 days, we are required to redeem the
outstanding shares of Series G 8% Convertible Preferred Stock.
The selling securityholders and any broker-dealers that act in connection
with the sale of securities might be deemed to be underwriters within the
meaning of Section 2(a)(11) of the Securities Act, and any commissions received
by those broker-dealers and any profit on the resale of the securities sold by
them while acting as principals might be deemed to be underwriting discounts or
commissions under the Securities Act.
Because the selling securityholders may be deemed to be underwriters within
the meaning of Section 2(a)(11) of the Securities Act, the selling
securityholders will be subject to the prospectus delivery requirements of the
Securities Act. We have informed the selling securityholders that the anti-
manipulative provisions of Regulation M promulgated under the Exchange Act may
apply to their sales in the market.
The selling securityholders also may resell all or a portion of the shares
in open market transactions in reliance upon Rule 144 under the Securities Act,
provided they meet the criteria and conform to the requirements of that Rule.
Indemnification Provided in Connection with the Offering by ImaginOn
We have agreed to indemnify the selling securityholders and the officers,
directors and each person who controls the selling securityholders against all
losses, claims, damages, liabilities and expenses caused by:
. any untrue or alleged untrue statement of material fact contained in
the registration statement, this prospectus or any amendment or
supplement to these documents; or
. any omission or alleged omission to state a material fact in the
registration statement, this prospectus or any amendment or supplement
to these documents that is required to be stated or necessary to
ensure that the documents are not misleading.
The selling securityholders will not be indemnified if the claims result
from any written information furnished to us by the investor or the selling
securityholders fail to deliver a copy of this prospectus to a buyer.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers, or persons controlling ImaginOn
pursuant to the foregoing provisions, ImaginOn has 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.
-10-
<PAGE>
Legal Matters
Friedlob Sanderson Paulson & Tourtillott, LLC, Denver, Colorado, as our
counsel, has issued an opinion as to the validity of the common stock and
purchase warrants.
Experts
The consolidated financial statements incorporated herein by reference have
been audited by Gelfond Hochstadt Pangburn, P.C., independent certified public
accountants, given upon their authority as experts in auditing and accounting.
-11-
<PAGE>
[LOGO]
19,875,984 Shares Common Stock
____________________________________
PROSPECTUS
____________________________________
--------------------------------------------------------------------------------
We have not authorized any dealer, salesperson or other person to give you
written information other than this prospectus or to make representations as to
matters not stated in the prospectus. You must not rely on unauthorized
information. This prospectus is not an offer to sell these securities or our
solicitation of your offer to buy the securities in any jurisdiction where that
would not be permitted. The information contained in this prospectus is correct
only as of the date of this prospectus, regardless of the time of the delivery
of this prospectus or any sale of these securities.
--------------------------------------------------------------------------------
November 20, 2000
-12-
<PAGE>
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14 - OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following is an itemization of all expenses (subject to future
contingencies) incurred or to be incurred by the Registrant in connection with
the issuance and distribution of the securities being offered. All expenses are
estimated except the registration and NASD filing fees.
Registration and filing fee $ 1,804
Printing 1,000
Accounting fees and expenses 5,000
Legal fees and expenses 10,000
Blue sky fees and expenses 500
Transfer Agent 1,000
Other 596
-------
Total $19,900
=======
ITEM 15 - INDEMNIFICATION OF DIRECTORS AND OFFICERS
INDEMNIFICATION PROVIDED UNDER IMAGINON'S CERTIFICATE OF INCORPORATION
Section 145 of the Delaware General Corporation Law and Article Ninth of
the Registrant's Certificate of Incorporation provides for, under certain
circumstances, the indemnification of the Registrant's officers, directors,
employees and agents against liabilities which they may incur in such
capacities. A summarization of the circumstances in which such indemnifications
provided for is contained herein, but that description is qualified in its
entirety by reference to Article Ninth of the Registrant's Certificate of
Incorporation and the relevant Section of the Delaware General Corporation Law.
In general, the statute provides that any director, officer, employee or
agent of a corporation may be indemnified against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement, actually and reasonably
incurred in a proceeding (including any civil, criminal, administrative or
investigative proceeding) to which the individual was a party by reason of such
status. Such indemnity may be provided if the indemnified person's actions
resulting in the liabilities: (i) were taken in good faith; (ii) were reasonably
believed to have been in or not opposed to the Registrant's best interest; and
(iii) with respect to any criminal action, such person had no reasonable cause
to believe the actions were unlawful. Unless ordered by a court,
indemnification generally may be awarded only after a determination of
independent members of the Board of Directors or committee thereof, by
independent legal counsel or by vote of the stockholders that the applicable
standard of conduct was met by the individual to be indemnified.
The statutory provisions further provide that to the extent a director,
officer, employee or agent is wholly successful on the merits or otherwise in
defense of any proceeding to which he was a party, he is entitled to receive
indemnification against expenses, including attorneys' fees, actually and
reasonably incurred in connection with the proceeding.
Indemnification in connection with a proceeding by or in the right of
ImaginOn in which the director, officer, employee or agent is successful is
permitted only with respect to expenses, including attorneys' fees actually and
reasonably incurred in connection with the defense. In such actions, the person
to be indemnified must have acted in good faith, in a manner believed to have
been in ImaginOn's best interest and must not have been adjudged liable to
ImaginOn unless and only to the extent that the Court of Chancery or the court
in which such action or suit was brought shall determine upon application that,
despite the adjudication of liability, in view of all the circumstances of the
case, such person is fairly and reasonably entitled to indemnity for such
expense which the Court of Chancery or such other court shall deem proper.
Indemnification is otherwise prohibited in connection with a proceeding brought
on behalf of the Registrant in which a director is adjudged liable to the
Registrant, or in connection with any proceeding charging
II-1
<PAGE>
improper personal benefit to the director in which the director is adjudged
liable for receipt of an improper personal benefit.
Delaware law authorizes the Registrant to reimburse or pay reasonable
expenses incurred by a director, officer, employee or agent in connection with a
proceeding in advance of a final disposition of the matter. Such advances of
expenses are permitted if the person furnishes to the Registrant a written
agreement to repay such advances if it is determined that he is not entitled to
be indemnified by ImaginOn.
The statutory section cited above further specifies that any provisions for
indemnification of or advances for expenses does not exclude other rights under
the Registrant's Certificate of Incorporation, Bylaws, resolutions of its
stockholders or disinterested directors, or otherwise. These indemnification
provisions continue for a person who has ceased to be a director, officer,
employee or agent of ImaginOn and inure to the benefit of the heirs, executors
and administrators of such persons.
The statutory provision cited above also grants the power to the Registrant
to purchase and maintain insurance policies which protect any director, officer,
employee or agent against any liability asserted against or incurred by him in
such capacity arising out of his status as such. Such policies may provide for
indemnification whether or not ImaginOn would otherwise have the power to
provide for it. No such policies providing protection against liabilities
imposed under the securities laws have been obtained by the Registrant.
Article VIII of the Registrant's Bylaws provides that the Registrant shall
indemnify its directors, officers, employees and agents to the fullest extent
permitted by the Delaware General Corporation Law. In addition, the Registrant
has entered into agreements with its directors indemnifying them to the fullest
extent permitted by the Delaware General Corporation Law.
ITEM 16 - EXHIBITS
The following is a complete list of exhibits filed as part of this
registration statement:
No. Description
4.1 Specimen of Common Stock certificate. (Incorporated by reference
to Exhibit 4.1 to Amendment No. 4 to the Registrant's
Registration Statement on Form SB-2/A, filed with the SEC on
December 22, 1994, Commission File No. 033-85108.)
4.2 Certificate of Designations, Preferences and Rights of Series G
8% Convertible Preferred Stock dated August 3, 2000.
(Incorporated by reference to Exhibit 4.2 of the Registrant's
September 30, 2000 10-QSB).
4.3 Amended Certificate of Designations, Preferences and Rights of
Series G 8% Convertible Preferred Stock dated August 16, 2000.
(Incorporated by reference to Exhibit 4.3 of the Registrant's
September 30, 2000 10-QSB).
4.4 Amended Certificate of Designations, Preferences and Rights of
Series G 8% Convertible Preferred Stock dated October 16, 2000.
(Incorporated by reference to Exhibit 4.4 of the Registrant's
September 30, 2000 10-QSB).
4.5 Amended Certificate of Designations, Preferences and Rights of
Series G 8% Convertible Preferred Stock dated October 17, 2000.
(Incorporated by reference to Exhibit 4.5 of the Registrant's
September 30, 2000 10-QSB).
5.1 Opinion of Friedlob Sanderson Paulson & Tourtillott, LLC
II-2
<PAGE>
10.1 Purchase Agreement dated October 2000 by and among the Registrant
and the Series G Preferred investors. (Incorporated by reference
to Exhibit 10.1 of the Registrant's September 30, 2000 10-QSB).
10.2 Registration Rights Agreement dated October, 2000 by and among
the Registrant and the Series G Preferred investors.
(Incorporated by reference to Exhibit 10.2 of the Registrant's
September 30, 2000 10-QSB).
11.1 Computation of Net Income (Loss) Per Share (Incorporated by
reference to Exhibit 11.1 of the Registrant's September 30, 2000
10-QSB).
23.1 Consent of Independent Certified Public Accountants
23.2 Consent of Friedlob Sanderson Paulson & Tourtillott, LLC (See
Exhibit 5.1)
ITEM 17 - UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement 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.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual report pursuant
to section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to the initial bona fide offering
thereof.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
and has duly caused this amended registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of San Carlos,
State of California, on November 20, 2000.
IMAGINON, INC.
By:/s/ David M. Schwartz
----------------------------------------
David M. Schwartz,
Chairman, Chief Executive Officer
and President
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints David M. Schwartz, his attorney-in-fact, for him
in any and all capacities, to sign any amendments to this registration
statement, and any related registration statement filed pursuant to Rule 462(b),
and to file the sale, with exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming all that said attorney-in-fact, or his substitute, may 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.
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
---------- ----- ----
<S> <C> <C>
/s/ David M. Schwartz Chief Executive Officer November 20, 2000
------------------------------------------------------ and Director
David M. Schwartz
/s/ James A. Newcomb Chief Financial Officer November 20, 2000
------------------------------------------------------ and Director
James A. Newcomb
/s/ Dennis Allison Director November 20, 2000
------------------------------------------------------
Dennis Allison
/s/ Jim Polizotto Director November 20, 2000
------------------------------------------------------
Jim Polizotto
/s/ Mary E. Finn Director November 20, 2000
------------------------------------------------------
Mary E. Finn
</TABLE>
