SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. ___)
PROTOSOURCE CORPORATION
(Name of Issuer)
Common Stock. no par value
(Title of Class of Securities)
743958 10 0
(CUSIP Number)
Charles Snow, Esq.
Snow Becker Krauss P.C.
605 Third Avenue, New York, New York 10021
(212) 687-3860
(Name, Address and Telephone Number of
Person Authorized to Receive Notices and Communications)
October 31, 1996
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13D-1(b)(3) or (4), check the following box [ ].
Page 1 of 4 pages
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SCHEDULE 13D
CUSIP No. 743958 10 0 Page 2 of 4 Pages
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1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Howard Silverman
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
3) SEC USE ONLY
4) SOURCE OF FUNDS
OO
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
6) CITIZENSHIP OR PLACE OF ORGANIZATION
USA
7) SOLE VOTING POWER
0
NUMBER 8) SHARED VOTING POWER
OF SHARES 0
BENEFICIALLY
OWNED BY 9) SOLE DISPOSITIVE POWER
EACH 850,000
REPORTING
PERSON WITH 10) SHARED DISPOSITIVE POWER
0
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
850,000
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [ ]
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
11%
14) TYPE OF REPORTING PERSON
IN
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Page 3 of 4
Item 1. Security and Issuer.
This Statement relates to shares of Common Stock, without par value (the
"Shares"), underlying certain warrants (the "Warrants") issued to the Reporting
Person by ProtoSource Corporation, a California corporation (the "Issuer"). The
principal executive offices of the Issuer are located at 2580 West Shaw Lane,
Suite 102, Fresno, CA 93711-2765.
Item 2. Identity and Background.
The Reporting Person is Howard Silverman, a financial consultant with an
address at 2618 South Beverly Drive, Los Angeles, CA 90034.
During the last five years, the Reporting Person has not been convicted in
a criminal proceeding (excluding traffic violations or similar misdemeanors).
During the past five years, the Reporting Person has not been a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction
resulting in a judgment, decree or final order enjoining future violations of,
or prohibiting or mandating activities subject to, Federal or state securities
laws or finding any violation with respect to such laws.
The Reporting Person is a citizen of the United States of America.
Item 3. Source and Amount of Funds or Other Consideration.
The Reporting Person acquired the Warrants as compensation for acting as
Financial Consultant to Andrew, Alexander, Wise & Company, Inc., the placement
agent (the "Placement Agent") for the Issuer in a private offering by the Issuer
of an aggregate of 6,400,000 Shares for an aggregate amount of 1,700,000 (the
"Offering").
Item 4. Purpose of Transaction.
The Reporting Person acquired the Warrants for investment purposes only and
not with a view to their resale or distribution. Absent any change in personal
circumstances, the Reporting Person intends to maintain his equity position in
the Issuer. The Reporting Person, however, has been granted registration rights
with respect to the Shares underlying the Warrants and intends to review on a
continuing basis its investment in the Issuer and may, depending upon such
evaluation of the Issuer's business and prospects and upon future developments
in the Issuer's business and economic conditions, determine to increase,
decrease, continue to hold or dispose of his position in the Issuer.
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Page 4 of 4
Item 5. Interest in Securities of the Issuer.
(a) The Reporting Person beneficially owns 850,000 Warrants. This amount
represents approximately 11% of the outstanding Shares of the Issuer.
(b) The Warrants confer no voting power. The Reporting Person has sole
dispositive power over the Warrants.
(c) The Reporting Person has not, in the past sixty days, engaged in any
other transactions involving Shares of the Issuer.
(d) and (e) N/A.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
The Reporting Person has no agreements or understandings with any person or
entity respecting the Warrants other than a Lock-Up Agreement with the Placement
Agent for the Issuer relating to the 850,000 Warrants.
Item 7. Material to be Filed as Exhibits.
1. Lock-up Agreement signed between the Reporting P erson and the Placement
Agent .
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: November 7, 1996
/s/ Howard Silverman
Howard Silverman
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Exhibit 1
LOCK-UP AGREEMENT
LOCK-UP AGREEMENT (the "Agreement" or "Lock-Up Agreement") dated September
30, 1996 by and between Howard Silverman, with a address of 300 East 62nd
Street, New York, New York 10021 ("Silverman"), and Andrew, Alexander, Wise &
Co. with a place of business at 17 State Street, New York, NY 10004 ("AAWC").
W I T N E S S E T H:
WHEREAS, Silverman is the holder of warrants to purchase up to 850,000
shares of the restricted Common Stock (the "Shares") of ProtoSource Corporation
(the "Company") and;
WHEREAS, AAWC is the holder of warrants to purchase up to 1,350,000 Shares;
WHEREAS, Silverman, AAWC and all other holders of the Shares have agreed
not to sell, transfer or otherwise dispose of the Shares except during the time
periods set forth in accordance with the terms of this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the terms, conditions
and mutual covenants appearing in this Agreement and the Release, the parties
hereto hereby agree as follows:
SECTION 1.
(A) Silverman hereby agrees that he will not offer, sell, transfer or
otherwise dispose of the Shares or the Shares underlying the warrants without
the prior written consent of AAWC for a period of three (3) years following the
date hereof (the "Term").
(B) For a period of two (2) years following the Term of this Agreement,
Silverman may sell Shares subject to this Lock-Up Agreement through a broker
other than AAWC only if such other broker has made a higher bid than AAWC,
except that AAWC shall have the right to receive immediate notice of such higher
bid and if AAWC is able to make the same or higher bid, then AAWC shall be the
selling broker.
(C) Silverman acknowledges that his breach or impending violation of any of
the provisions of this Agreement may cause irreparable damage to AAWC for which
remedies at law would be inadequate. Silverman further acknowledge that the
provisions set forth herein are essential terms and conditions of the Release.
Silverman therefore agrees that AAWC shall be entitled to a decree or order by
any court of competent jurisdiction enjoining such impending or actual violation
of any of such provisions. Such decree or order, to the extent appropriate,
shall specifically enforce the full performance of any such provision by
Silverman, and Silverman and AAWC hereby consent to the jurisdiction of any such
court of competent jurisdiction, state or federal, sitting in the State of New
York, and authorizes the entry on its behalf of any required appearance for such
purpose. This remedy shall be in addition to all other remedies available to
AAWC at law or equity. If any portion of this Section 1 is adjudicated to be
invalid or unenforceable, this Section 1 shall be deemed amended to delete
therefrom the portion so adjudicated, such deletion to apply only with respect
to the operation of this Section 1 in the jurisdiction in which such
adjudication is made.
SECTION 2. Subject to Section 5 hereunder, this Agreement shall inure to
the benefit of and be binding upon AAWC and Silverman, their successors and
assigns.
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SECTION 3. Should any part of this Agreement, for any reason whatsoever, be
declared invalid, illegal, or incapable of being enforced in whole or in part,
such decision shall not affect the validity of any remaining portion, which
remaining portion shall remain in full force and effect as if this Agreement had
been executed with the invalid portion thereof eliminated, and it is hereby
declared the intention of the parties hereto that they would have executed the
remaining portion of this Agreement without including therein any portion which
may for any reason be declared invalid.
SECTION 4. This Agreement shall be construed and enforced in accordance
with the laws of the State of New York applicable to agreements made and to be
performed in such State without application of the principles of conflicts of
laws of such State.
SECTION 5. This Agreement and all rights hereunder are personal to the
parties and shall not be assignable, and any purported assignment in violation
thereof shall be null and void.
SECTION 6. Any notice (except under paragraph 1(B)) statement, report,
request or demand required or permitted to be given by this Agreement shall be
in writing, and shall be sufficient if delivered in person or if addressed and
sent by certified mail, return receipt requested, postage prepaid; or by
overnight courier service; or by facsimile transmission, followed promptly by
first class mail, to the parties at the addresses set forth above, or at such
other place that either party may designate by notice in the foregoing manner to
the other. Any such notice shall be deemed given five (5) days after being
mailed by certified mail, three (3) days after being sent by facsimile
transmission followed by being mailed by first class mail, one (1) day after
being sent by overnight courier service with morning delivery and immediately
when personally delivered.
SECTION 7. The failure of either party to insist upon the strict
performance of any of the terms, conditions and provisions of this Agreement
shall not be construed as a waiver or relinquishment of future compliance
therewith, and said terms, conditions and provisions shall remain in full force
and effect. No waiver of any term or any condition of this Agreement on the part
of either party shall be effective for any purpose whatsoever unless such waiver
is in writing and signed by such party.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first written above.
ANDREW, ALEXANDER, WISE & CO.
By: /s/Andreas Zigouras
Andreas Zigouras
/s/Howard Silverman
Howard Silverman
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