As filed with the Securities and Exchange Commission on May 11, 1999
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------
DIGITAL DATA NETWORKS, INC.
(Exact name of registrant as specified in its charter)
Washington 91-1426372
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3102 Maple Avenue
Suite 230
Dallas, TX 75201
(214) 969-7200
(Address, including zip code and telephone number,
of registrant's principal executive offices)
---------------------------
1994 Combined Incentive and Nonqualified Stock Option Plan
and
1996 Combined Incentive and Nonqualified Stock Option Plan
(Full title of the plans)
--------------------------
Donald B. Scott
President, Chairman of the Board and Chief Executive Officer
3102 Maple Avenue
Suite 230
Dallas, TX 75201
(214)969-7200
(Name, address and telephone number of agent for services)
------------------------
Copies to:
Maurice J. Bates, L.L.C.
8214 Westchester, Suite 500
Dallas, TX 75225
Phone: (214) 692-3566
Fax: (214) 9878-2091
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed
Title of Proposed Maximum Maximum Amount
Securities Amount Offering Price Aggregate of
To be to be Per Share (1) Offering Price Registration
Registered Registered (1) Fee (2)
- --------------------------------------- ------------------ -------------------- ------------------ ------------------
<S> <C> <C> <C> <C>
Common Stock, no par value 355,652 $ .25 $ 88,913
- --------------------------------------- ------------------ -------------------- ------------------ ------------------
Common Stock, no par value 6,000 $ 4.50 $ 27,000
- --------------------------------------- ------------------ -------------------- ------------------ ------------------
TOTAL 361,652 - $ 115,913 $ 78.00
- --------------------------------------- ------------------ -------------------- ------------------ ------------------
</TABLE>
(1) Estimated solely for the purposes of calculating the registration fee
based upon the exercise price of $.25 per share with respect to 355,652
shares of common stock and $4.50 per share with respect to 6,000 shares
of common stock.
(2) The registration fee paid in connection herewith is based upon the
price at which the options may be exercised pursuant to Rule 457(h)(1).
<PAGE>
TABLE OF CONTENTS
Page
----
Available Information . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Incorporation of Certain Information by Reference . . . . . . . . . . . . 2
The Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Plan of Distribution. . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Selling Stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Legal Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Market for Common Stock. . . . . . . . . . . . . . . . . . . . . . . . . . 5
Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Disclosure of Commission Position of Indemnification for
Securities Act Liabilities . . . . . . . . . . . . . . . . . . . . . . . . 5
Information Required in the Section 10(a) Prospectus. . . . . . . . . . . 5
Information Required in the Registration Statement. . . . . . . . . . . . 6
Signatures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Exhibit Index. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
<PAGE>
REOFFER PROSPECTUS
Digital Data Networks, Inc.
361,652 Shares of Common Stock
(No Par Value)
This reoffer prospectus has been prepared for use in connection with
the proposed sales by the stockholders named herein (the "Selling Stockholders")
of an aggregate of 361,652 shares of Common Stock (no par value) of Digital Data
Networks, Inc. (the "Company") which can be acquired by the Selling Stockholders
upon the exercise of options granted to them under the Company's 1994 Combined
Incentive and Nonqualified Stock Option Plan and 1996 Combined Incentive and
Nonqualified Stock Option Plan.
The Selling Stockholders directly, through agents designated from time
to time, or through brokers, dealers, or through underwriters to be designated,
may sell the shares of common stock offered hereby from time to time on terms to
be determined at the time of sale. To the extent required by applicable law, the
specific shares to be sold, the terms of the offering, including price, the
names of any agent, dealer or underwriter, and any applicable commission,
discount or other compensation with respect to a particular sale, will be set
forth in an accompanying Prospectus Supplement. See "Selling Stockholders" and
"Plan of Distribution."
The Company will receive none of the proceeds from the sale of these
shares. The Selling Stockholders and any broker-dealers, agents or underwriters
that participate with the Selling Stockholders in the distribution of the common
stock may be deemed to be underwriters within the meaning of the Securities Act,
and any commission received by them and any profit on the resale of the common
stock purchased by them, may be deemed to be underwriting commissions or
discounts under the Securities Act. The Company has paid all of the costs of the
offering with respect to the shares to be offered by the Selling Stockholders.
See "Selling Stockholders" and "Plan of Distribution."
The Company's common stock is currently listed for trading in the
over-the-counter market and is quoted on the National Association of Securities
Dealers, Inc. Bulletin Board or in the "pink sheets" maintained by the National
Quotation Bureau, Inc. under the symbol "DIDA." On May 5, 1999, the closing
market price for the common stock as traded in the over-the-counter market was
approximately $.33 per share.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is May 11, 1999.
1
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the information requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and, in
accordance therewith, files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the Public
Reference Room of the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the Commission's regional offices at 7 World Trade
Center, Suite 1300, New York, New York 10048; and at 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. Copies of the Registration Statement and
the exhibits and schedules thereto may be obtained from the Public Reference
Room of the Commission at its principal office in Washington, D.C. at prescribed
rates. The Commission maintains a web site that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the Commission. The address of the Commission's web site is
http://www.sec.gov.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents, including the exhibits thereto, which are on
file with the Securities and Exchange Commission, are incorporated in this
Registration Statement by reference:
(a) The Company's Annual Report on Form 10-KSB for the year ended
December 31, 1998;
(b) The description of the Common Stock which is contained in the
Company's Registration Statement on Form SB-2 (File
33-95744-D) filed under the Securities Act of 1933, as
amended;
(c) All other reports filed pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 since the end of the
fiscal year referred to in (a) above.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 from the date
hereof to the termination of the offering of the securities covered hereby shall
be deemed to be incorporated by reference in the Prospectus and to be a part
hereof from the date of filing such documents.
Copies of documents incorporated herein by reference may be obtained
upon written or oral request without charge (other than exhibits thereto) from
the headquarters of the Company, Digital Data Networks, Inc., 3102 Maple Avenue,
Suite 230, Dallas, Texas 75201, telephone (214) 969-7200, Attention: Rick
Boeglin, Vice President, Finance and Operations.
2
<PAGE>
THE COMPANY
The Company was incorporated as Transit Information Systems, Inc. under
the laws of the State of Washington on October 17, 1988. The present name was
adopted in July, 1995. The Company also operates as The Transit Network under an
assumed name certificate.
The Company, a wireless, passenger communication and advertising
company, is principally engaged in development, design, installation and
operation of a "digital information network". Utilizing an FM subcarrier signal
to transmit data, this network of computerized electronic displays deliver
current news, information and advertising to riders on-board public transit
vehicles.
The Company currently has four full-time employees and one part-time
employee. Its principal executive offices are located at 3102 Maple Avenue,
Suite 230, Dallas, Texas 75201, telephone (214) 969-7200.
PLAN OF DISTRIBUTION
The shares of the Company's common stock offered hereby by the Selling
Stockholders may be sold from time to time to purchasers directly by the Selling
Stockholders. Alternatively, the Selling Stockholders may from time to time
offer the shares of common stock through underwriters, dealers or agents, who
may receive compensation in the form of underwriting discounts, concessions or
commissions from the Selling Stockholders and/or the purchasers of the shares
for whom they may act as agent. The Selling Stockholders and any underwriters,
dealers or agents that participate in the distribution of the shares of common
stock may be deemed to be underwriters and any profit on the sale of shares by
them and any discounts, commissions or concessions received by any such
underwriters, dealers or agents may be deemed to be underwriting discounts and
commissions under the Securities Act.
The shares of common stock may be sold from time to time in one or more
transactions at a fixed offering price which may be changed or at varying prices
determined at the time of sale or negotiated prices.
The Company has paid all of the expenses incident to the offering of
the shares of the common stock offered by the Selling Stockholders, other than
commissions and discounts of underwriters, dealers or agents.
3
<PAGE>
SELLING STOCKHOLDERS
The table below sets forth the names and present positions held by the
Selling Stockholders, all of whose addresses are care of the Company at 3102
Maple Avenue, Suite 230, Dallas, Texas 75201. The shares that the Selling
Stockholders may offer from time to time are shares acquired or to be acquired
by them upon the exercise of options that have been granted to them by the
Company pursuant to the Company's 1994 Combined Incentive and Nonqualified Stock
Option Plan and/or 1996 Combined Incentive and Nonqualified Stock Option Plan
(the "Plans"). The following table lists all persons holding awards, who,
because of their position with the Company or amount of stock of the Company
owned by them, may be deemed to be "affiliates" and persons who are
non-affiliates who have acquired shares under the Plans prior to the filing of
the registration statement of which this prospectus is a part. The Selling
Stockholders may from time to time offer all or part of the shares acquired by
them upon the exercise of options now held or which may be granted to them in
the future by the Company in any trading markets. The Company will pay all
expenses of preparing and reproducing this Prospectus, but will not receive any
part of the proceeds of the sale of any such shares. The Selling Stockholders
will pay any and all brokerage commissions charged to sellers in connection with
such sales.
<TABLE>
<CAPTION>
No. of Shares No. of
Owned Before Shares
Name Position with Company Offering (1) Offered (2)
- ---- --------------------- ------------ -----------
<S> <C> <C>
Donald B. Scott, Jr. President and 63,278 124,723
Chief Executive Officer
James F. Biagi, Jr. Secretary and Director 11,181 107,952
Robert F. Hussey Director 100,000 50,000
Richard J. Boeglin Vice President, 2,246 61,798
Finance and Operations
Susan E. Hassel Vice President, Sales 16,678 11,179
Fred Meyers Former Affiliate 2,500 6,000
</TABLE>
- --------------
(1) Includes shares of Common Stock, either owned or which may be acquired upon
the exercise of options, not covered by this prospectus.
(2) Option shares only which may be sold pursuant to this prospectus.
LEGAL MATTERS
The legality of the shares of Common Stock being offered hereby will be
passed upon by Maurice J. Bates, L.L.C., 8214 Westchester, Suite 500, Dallas,
Texas 75225.
4
<PAGE>
EXPERTS
The financial statements incorporated in this prospectus by reference
to the Company's Annual Report on Form 10-KSB for the year ended December 31,
1998, have been so incorporated in reliance on the report of BDO Seidman, LLP,
independent certified public accountants, given on the authority of such firm as
experts in auditing and accounting.
MARKET FOR COMMON STOCK
The Common Stock of the Company, including the shares offered hereby,
is designated for quotation on the Nasdaq OTC Bulletin Board under the symbol:
DIDA.
USE OF PROCEEDS
The Company will not receive any proceeds from the reoffer and resale
of securities by the Selling Stockholders hereunder.
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
The Commission has expressed its opinion that indemnification of
directors, officers and controlling persons of the Company against liabilities
arising under the Securities Act, is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the Company
of expenses incurred or paid by an Indemnitee of the Company in the successful
defense of any such act or proceeding) is asserted by such Indemnitee in
connection with securities which have been registered by the Company, the
Company will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.
The information required by Part I is included in documents to be sent
or given to the participants.
5
<PAGE>
Item 2. Registration Information and Employee Plan Annual Information.
Upon written or oral request, Digital Data Networks, Inc., a Washington
corporation (the "Registrant") will provide, without charge, a copy of all
documents incorporated by reference in Item 3 of Part II of this Registration
Statement, which are incorporated by reference in the Section 10(a) Prospectus,
and all other documents required to be delivered to employees pursuant to Rule
428(b) promulgated under the Securities Act of 1933, as amended (the "Securities
Act"). All requests should be made to Digital Data Networks, Inc., 3102 Maple
Avenue, Suite 230, Dallas, 75201, telephone number (214) 969-7200.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents filed by Digital Data Networks, Inc. (the
"Company") with the Commission are also incorporated herein by reference:
(a) The Company's Annual Report on Form 10-KSB for the year ended
December 31, 1998;
(b) The description of the Common Stock which is contained in the
Company's Registration Statement on Form SB-2 (File 33-95744-D)
filed under the Securities Act of 1933, as amended.
(c) All other reports filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 since the end of the fiscal year
referred to in (a) above.
In addition to the foregoing, all documents subsequently filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, prior to the filing of a post-effective amendment
indicating that all of the securities offered hereunder have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be a part hereof
from the date of filing of such documents. Any statement contained in a document
incorporated by reference in the Registration Statement shall be deemed to be
modified or superseded for purposes of the Registration Statement to the extent
that a statement contained herein or in any subsequently filed document that is
also incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of the Registration Statement.
Item 4. Description of Securities
Not Applicable.
6
<PAGE>
Item 5. Interests of Named Experts and Counsel
Not Applicable.
Item 6. Indemnification of Directors and Officers
Pursuant to Section 23B.08.500 of the Washington Business Corporation
Act, a corporation may indemnify an individual made a party to a proceeding
because the individual is or was a director against liability incurred in his
official capacity with the corporation including expenses and attorneys fees.
Article IX of the Bylaws provides that the Company may indemnify and hold
harmless to the full extent permitted by applicable law each person who was or
is made a party to or is threatened to be made a party to or is involved in an
actual or threatened action, suit, or other proceeding, civil or criminal, by
reason of the fact that he is or was a director, officer, employee or agent of
the Company against all expenses, liabilities and losses, including attorneys
fees, judgments, fines, and ERISA excise taxes or penalties, actually or
reasonably incurred or suffered by such person in connection with any such
action.
Article V of the Restated Articles of Incorporation provides that a
director of the Company shall not be personally liable to the Company or its
shareholders for monetary damages for conduct as a director, except for
liability of the director (i) for acts or omissions that involve intentional
misconduct by the director or knowing violation of law by the director, (ii) or
conduct violating Section 23B.08.310 of the Washington Business Corporation Act
(pertaining to liability for unlawful distributions), or (iii) for any
transaction from which the director will personally receive a benefit in money,
property or services to which the director is not legally entitled.
Item 7. Exemption from Registration Claimed
Offers and sales of Common Stock pursuant to the Plans were exempt from
registration under the Securities Act of 1933, as amended, by virtue of Sections
4(2) of such Act. Since the inception of the Plans, a total of six (6) persons
have been granted options under the Plans for an aggregate of 361,652 shares. No
persons have exercised options and purchased Common Stock. The issuances of the
options were deemed to be exempt from registration pursuant to Section 4(2) of
the Securities Act as transactions not involving a public offering. All
optionees were officers and/or directors, except one consultant who was a
business marketing consultant, who were familiar with the Company and its
business and had access to corporate and financial information about the
Company.
Item 8. Exhibits
4.1 1994 Combined Incentive and Nonqualified Stock Option Plan (1)
4.2 1996 Combined Incentive and Nonqualified Stock Option Plan (2)
5.1 Opinion of Maurice J. Bates, L.L.C. (3)
23.0 Consent of BDO Seidman, LLP
- --------------
(1) Incorporated by reference to Registration Statement of Form SB-2 (File No.
33-95744-D), Exhibit 10.1.
(2) Incorporated by reference to Schedule 14, the Company's Definitive Proxy
Statement, filed May 7, 1996.
(3) Filed herewith.
7
<PAGE>
Item 9. Undertakings
(a) 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:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus, any facts or events
arising after the effective date of the
Registration Statement (or the most recent
post-effective amendment thereof) which,
individually or in the aggregate, represent a
fundamental change in the information set forth in
the Registration Statement;
(iii) To include any material information with respect
to the plan of distribution not previously
disclosed in the Registration Statement or any
material change to such information in the
Registration Statement; provided, however, that
paragraphs 1(i) and 1(ii) do not apply if the
information required to be included in a
post-effective amendment by those paragraphs is
contained in periodic reports filed by the
Registrant pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 that are
incorporated by reference in the Registration
Statement;
(iv) That, for the purposes 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; and
(v) To remove from registration by means of a
post-effective amendment any of the securities
being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act
of 1933, each filing of the Registrant's annual report
pursuant to Section 13(a) or Section 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 be the initial bona
fide offering thereof.
8
<PAGE>
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of
expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense
of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it
is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and have duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Dallas, State of Texas, May 11, 1999.
DIGITAL DATA NETWORKS, INC.
By: /s/ Donald B. Scott, Jr.
-------------------------------------
Donald B. Scott, Jr.
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons, in their
capacities at Digital Data Networks, Inc. and on the dated indicated.
<TABLE>
<CAPTION>
Person Title Date
------ ----- ----
<S> <C> <C>
/s/ Donald B. Scott, Jr. Chairman of the Board, President, May 11, 1999
- ------------------------- Chief Executive Officer and Director
Donald B. Scott, Jr. (Principal Executive Officer)
/s/ James F. Biagi, Jr. Secretary and Director May 11, 1999
- ------------------------
James F. Biagi, Jr.
/s/ Richard J. Boeglin Vice President, Finance and May 11, 1999
- ----------------------- Operations (Principal Financial and
Richard J. Boeglin Accounting Officer)
9
<PAGE>
/s/ Robert F. Hussey Director May 11, 1999
- ---------------------
Robert F. Hussey
</TABLE>
10
<PAGE>
EXHIBIT INDEX
Document Description of Document
- -------- -----------------------
5.1 Opinion of Maurice J. Bates, L.L.C.
23.0 Consent of BDO Seidman, LLP
11
<PAGE>
EXHIBIT 5.1
MAURICE J. BATES, L.L.C.
ATTORNEY AT LAW
8214 WESTCHESTER SUITE, 500
DALLAS , TEXAS 75225
Telephone (214) 692-3566
Fax (214) 987-2091
May 10, 1999
Digital Data Networks, Inc.
3102 Maple Avenue, Suite 230
Dallas, Texas 75201
Re: Registration Statement on Form S-8
Gentlemen:
I have acted as counsel to you in connection with the preparation of a
registration statement on Form S-8 (the "Registration Statement") under the
Securities Act of 1933, as amended, that you are filing with respect to 361,652
shares of common stock, no par value, (the "Shares") issuable pursuant to the
1994 Combined Incentive and Nonqualified Stock Option Plan and 1996 Combined
Incentive and Nonqualified Stock Option Plan of Digital Data Networks, Inc. (the
"Plans"). I have examined the minute books of the Company, copies of the Plans,
the Registration Statement and such other documents as I deemed necessary to
render this opinion.
Based upon the foregoing, I am of the opinion that the Plans and the
Shares have been duly authorized and, when issued and paid for in accordance
with the terms of the Plans, the Shares will be validly issued, fully paid and
non-assessable.
I hereby consent to the use of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Maurice J. Bates
--------------------
Maurice J. Bates
12
<PAGE>
EXHIBIT 23.0
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Digital Data Networks, Inc.
Dallas, Texas
We hereby consent to the incorporation by reference in the Company's Form S-8 of
our report dated March 10, 1999 relating to the consolidated financial
statements of Digital Data Networks, Inc. appearing in the Company's Annual
Report on Form 10-KSB for the year ended December 31, 1998.
/s/ BDO Seidman, LLP
- --------------------
BDO Seidman, LLP
Seattle, Washington
May 10, 1999
13
