-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OU2IJw3abCHllXHFWU1mewpaXooc98ThHjtM7c0CY+VAib0bUtE6xAbVRzBH1TbD ECIC3YFTmepTnHeCRd7rNg== 0001019056-97-000307.txt : 19971114 0001019056-97-000307.hdr.sgml : 19971114 ACCESSION NUMBER: 0001019056-97-000307 CONFORMED SUBMISSION TYPE: 424B3 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19971112 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: C-PHONE CORP CENTRAL INDEX KEY: 0000835585 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE & TELEGRAPH APPARATUS [3661] IRS NUMBER: 061170506 STATE OF INCORPORATION: NY FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: 424B3 SEC ACT: SEC FILE NUMBER: 333-25273 FILM NUMBER: 97714008 BUSINESS ADDRESS: STREET 1: 6714 NETHERLANDS DRIVE CITY: WILMINGTON STATE: NC ZIP: 28405 BUSINESS PHONE: 9103956100 MAIL ADDRESS: STREET 1: 6714 NETHERLANDS DR CITY: WILMINGTON STATE: NC ZIP: 28405 FORMER COMPANY: FORMER CONFORMED NAME: TARGET TECHNOLOGIES INC DATE OF NAME CHANGE: 19940615 424B3 1 FORM 424(B)(3) Filed pursuant to Rule 424(b)(3) under the Securities Act of 1933 Registration Statement on Form S-3 (No. 333-25273) PROSPECTUS SUPPLEMENT (to the Prospectus, dated June 25, 1997) C-PHONE CORPORATION 3 3,684,668 Shares Common Stock THIS PROSPECTUS SUPPLEMENT CONSTITUTES AN ESSENTIAL PART OF THE PROSPECTUS, DATED JUNE 25, 1997, OF C-PHONE CORPORATION (THE "PROSPECTUS") AND SHOULD BE READ IN CONJUNCTION WITH THE PROSPECTUS. The information set forth below supersedes the information contained under "Selling Shareholders" in the Prospectus. All capitalized terms used herein have the meanings given such terms in the Prospectus. SELLING SHAREHOLDERS The Selling Shareholders are the investors in the 1997 Placement (the "Investors"), the holders of the 1994 Warrants and the holders of the 1997 Warrants. The holders of the 1994 Warrants consist of employees (including controlling persons) of Josephthal, a former director of Josephthal and the estate of a former officer, director and principal shareholder of Josephthal. The holders of the 1997 Warrants consist of employees (including controlling persons) of Josephthal. The Investors include, among others, Josephthal and most of the holders of the 1994 Warrants. Josephthal was the representative of the underwriters for the 1994 Public Offering and the placement agent for the 1997 Placement. Josephthal also is a market maker for the Common Stock. Pursuant to the 1997 Placement, the Company issued to the Investors 833,667 shares of Common Stock (the "Original Shares") plus the right, under certain circumstances and without any additional consideration, to receive additional shares of Common Stock pursuant to the terms of "contingent value rights" (the "Rights"). The Rights are automatically exercised at the time that, and from time to time as, the Original Shares are first publicly sold through a broker dealer during the one-year period commencing June 25, 1997. The Rights, to the extent not exercised, expire June 25, 1998. The terms of the Rights provide that, upon any such initial sale of any Original Shares at a price of less than $8.00 per share, the seller of the Original Shares will automatically receive, for each such Original Share sold, without the payment of any additional consideration, such additional number of shares of Common Stock (the "Rights Shares") as equals (i) $8.00 divided by the Adjusted Price, minus (ii) one; where the Adjusted Price will equal the greater of (x) the average closing bid price per share of Common Stock on The Nasdaq National Market for the ten trading days immediately preceding the date of sale of the Original Shares, or (y) $2.00. The Original Shares and the Rights Shares are included in the Prospectus pursuant to certain registration rights granted to the Investors; the Company has agreed to maintain the effectiveness of the Registration Statement which contains the Prospectus until June 25, 1998. As of October 31, 1997, all of the Investors, except one Investor who holds 30,000 Original Shares, have sold all of their Original Shares and have been issued all of the Rights Shares, if any, to which each such Investor was entitled. In connection with the 1997 Placement, in addition to other consideration paid to Josephthal, the Company issued to WBM LLC, an Investor in the 1997 Placement and an affiliate of Josephthal, the 1997 Warrants to acquire an aggregate of 150,000 shares of Common Stock at an exercise price of $9.60 per share. The 1997 Warrants expire December 22, 1997. Substantially all of the 1997 Warrants have been transferred by WBM LLC to certain of the Selling Shareholders. The shares of Common Stock issuable upon exercise of the 1997 Warrants are included in the Prospectus. In connection with the 1994 Public Offering, the Company entered into the Representative's Warrant Agreement with Josephthal providing for the issuance to Josephthal of the 1994 Warrants to purchase 200,000 shares of Common Stock and also providing certain registration rights with respect to the shares issuable upon exercise of the 1994 Warrants. The 1994 Warrants have been transferred by Josephthal to certain of the Selling Shareholders. The shares of Common Stock issuable upon exercise of the 1994 Warrants are included in the Prospectus. 1 The following table sets forth certain information relating to the security ownership of the Selling Shareholders as of November 10, 1997 and as adjusted to reflect the sale of the Common Stock in the offering covered by the Prospectus. Except as set forth above, none of the Selling Shareholders has had a material relationship with the Company or any of its predecessors or affiliates within the past three years.
SHARES OF COMMON SHARES OF COMMON STOCK BENEFICIALLY STOCK BENEFICIALLY OWNED AFTER THE OWNED AS OF SHARES OF COMMON SALE OF SHARES NAME OF SELLING SHAREHOLDER OCTOBER 31, 1997 STOCK TO BE SOLD COVERED HEREBY13 - ------------------------------------------------------- ------------------ ------------------ ----------------- Balk, Matthew 64,613(1,2) 64,613(9) 0 Berger, Franklin 101(1) 101(9) 0 Borgman, Larry 101(1) 101(9) 0 Burke, Dennis 101(1) 101(9) 0 Cerruto, Kenneth 1,000(1) 1,000(9) 0 Corday, Brian 12,055(1) 12,055(9) 0 Fitzgerald, Paul 7,037(1,2) 7,037(9) 0 Guzzi, Anthony 43(1) 43(9) 0 Holistica International Ltd 714(3) 714(10) 0 Josephthal Lyon & Ross Incorporated 11,028(3) 11,028(10) 0 Kowitski, Steven 101(1) 101(9) 0 Larkin, Sherwood P 7,896(1,2) 7,896(9) 0 Loew, Michael 7,747(2,4) 7,560(9) 187 Majumdar, Swatick 1,000(1) 1,000(9) 0 Mando, Raymond 29(1) 29(9) 0 Masagung, Made Oka 120,000(5) 120,000(11) 0 Omotsu Holdings Ltd. 4,596(3) 4,596(10) 0 Paneco SA 5,651(3) 5,562(10) 0 Purjes, Esther 2,350(3) 2,350(10) 0 Purjes, Dan 177,752(6) 177,752(12) 0 Rice, Lawrence R 14,256(1,2) 14,256(9) 0 Roden, Charles 10,515(1,2) 10,515(9) 0 Satloff, Averell 1,793(1) 1,793(9) 0 Sheikh, Elahi 1,000(1) 1,000(9) 0 Shieb, Estate of Peter 22,467(1) 22,467(9) 0 Sobhy, Hisham 3,980(1) 3,980(9) 0 Syed, Saleem 35,000(3) 35,000(10) 0 The FK 1997 Grat 13,793(7) 3,793(10) 10,000 WBM LLC 4,645(8) 4,645(9) 0 Weisman, Scott 16,600(1,2) 16,600(9) 0
2 - ---------------- (1) Consists of shares of Common Stock issuable upon exercise of the 1994 Warrants and/or 1997 Warrants. (2) Does not include any shares of Common Stock issued or issuable to WBM LLC, a limited liability company in which such Selling Shareholder is a member. See footnote (8) to this table. Such Selling Shareholder disclaims beneficial ownership in any of such shares, since such Selling Shareholder has no voting power or investment power with respect to such shares. (3) Consists of Rights Shares issued to such Selling Shareholder in connection with the sale of Original Shares. (4) Consists of (a) 7,560 shares of Common Stock issuable upon exercise of the 1994 Warrants and 1997 Warrants, and (b) 187 shares of Common Stock previously purchased by Mr. Loew. (5) Consists of (a) 30,000 Original Shares, and (b) 90,000 Rights Shares (the maximum number of Rights Shares which may be issued to such Selling Shareholder in connection with the sale of such Original Shares). (6) Consists of (a) 173,107 shares of Common Stock issuable upon exercise of the 1994 Warrants and 1997 Warrants, and (b) 4,645 shares issuable to WBM LLC (see footnote (8) to this table), with respect to which Mr. Purjes is the managing member. Does not include any shares of Common Stock beneficially owned by Josephthal, of which Mr. Purjes is the Chairman and Chief Executive Officer. (7) Consists of (a) 3,793 Rights Shares issued to the FK 1997 Grat of which Felix Kaufman is the trustee, in connection with the sale of Original Shares, and (b) 10,000 shares of Common Stock purchased by Mr. Kaufman prior to the 1994 Public Offering. (8) Consists of shares of Common Stock issuable upon exercise of the 1997 Warrants. Dan Purjes is the managing member of WBM LLC and the shares attributable to WBM LLC also are included in the security ownership of Mr. Purjes (see footnote (6) to this table). (9) Consists of shares of Common Stock issuable upon exercise of the 1994 Warrants and/or 1997 Warrants and assumes the sale of all Shares covered by the Prospectus. (10) Consists of Rights Shares issued to such Selling Shareholder in connection with the sale of such Original Shares, and assumes the sale of all Shares covered by the Prospectus. (11) Consists of (a) 30,000 Original Shares, and (b) 90,000 Rights Shares (the maximum number of Rights Shares issuable to such Selling Shareholder in connection with the sale of such Original Shares), and assumes the sale of all Shares covered by the Prospectus. (12) Consists of (a) 173,107 shares of Common Stock issuable upon exercise of the 1994 Warrants and 1997 Warrants, and (b) 4,645 shares issuable to WBM LLC (see footnote (8) to this table), with respect to which Mr. Purjes is the managing member, and assumes the sale of all Shares covered by the Prospectus. (13) Assumes the sale of all Shares covered by the Prospectus. The date of this Prospectus Supplement is November 12, 1997 3 -----END PRIVACY-ENHANCED MESSAGE-----