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As filed with the Securities and Exchange Commission on August 27, 1998.
Registration No. 333-61571
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 1 TO FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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ACTIVISION, INC.
(Exact name of registrant as specified in its charter)
Delaware 94-2606438
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3100 Ocean Park Boulevard
Santa Monica, California 90405
(310) 255-2000
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
----------------------
Robert A. Kotick
Chairman of the Board and Chief Executive Officer
ACTIVISION, INC.
3100 Ocean Park Boulevard
Santa Monica, California 90405
(310) 255-2000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
----------------------
Copies To:
Robinson Silverman Pearce Aronsohn & Berman LLP
1290 Avenue of the Americas
New York, New York 10104
Attention: Kenneth L. Henderson, Esq.
(212) 541-2000
Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this Registration Statement.
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 the following
box and list the Securities Act registration statement 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: [ ]
CALCULATION OF REGISTRATION FEE
=============================================================================
Proposed Proposed
Maximum Maximum
Title of Class Amount Offering Aggregate Amount of
of Securities to be Price Offering Registration
to be Registered Registered Per Share(1) Price Fee
- -----------------------------------------------------------------------------
Common Stock,
$.000001
par value. . . . 1,000,000 shares $11.375 $11,375,000 $3,447(2)
=============================================================================
(1) Estimated solely for purposes of calculating the registration fee
pursuant to the provisions of Rule 457(c) under the Securities Act of
1933, as amended, based on the average of the reported last high and
low sales prices on the Nasdaq National Market on August 12, 1998.
(2) Previously paid.
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until the Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
=============================================================================
_____________________________________________________________________________
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement
becomes effective. This prospectus shall not constitute an offer to sell or
the solicitation of an offer to buy nor shall there be any sale of these
securities in any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such State.
_____________________________________________________________________________
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED AUGUST 27, 1998
1,000,000 Shares
ACTIVISION, INC.
Common Stock
-----------------
This Prospectus relates to 1,000,000 shares of Common Stock (the
"Common Stock"), par value $.000001 per share, of Activision, Inc. (the
"Company") being offered for the account of certain of the Company's
stockholders (each a "Selling Stockholder" and collectively the "Selling
Stockholders"). See "Selling Stockholders." The shares of Common Stock
offered hereby were issued to the Selling Stockholders in connection with the
issuance by the Company to the shareholders of S.B.F. Services, Limited, a
Minnesota corporation doing business as Head Games Publishing ("Head Games"),
of 1,000,000 shares of Common Stock in exchange for all of the outstanding
capital stock of Head Games owned by such shareholders.
The Company is a leading international publisher, developer and
distributor of interactive entertainment software. The Company's products
span a wide range of product genres, including action, adventure, strategy
and simulation, and have included best selling titles such as MechWarrior 2,
Vigilante 8, Hexen II, Nightmare Creatures, Heavy Gear, Dark Reign, Pitfall
and Shanghai. Since its founding in 1979, the Company has published hundreds
of entertainment software products for a variety of personal computer ("PC")
and console systems. See "The Company."
The Common Stock is traded in the NASDAQ National Market System
under the symbol "ATVI." On August 12, 1998, the last sale price for the
Common Stock as reported on the NASDAQ National Market System was $11.50 per
share.
No underwriting is being utilized in connection with this
registration of Common Stock and, accordingly, the shares of Common Stock are
being offered without underwriting discounts. The expenses of this
registration will be paid by the Company. Normal brokerage commissions,
discounts and fees will be payable by the Selling Stockholders.
For a discussion of certain matters which should be considered by
prospective investors, see "Risk Factors" commencing on page 2 of this
Prospectus.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OR ANY STATE SECURITIES 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 , 1998.
RISK FACTORS
Before purchasing any of the shares of Common Stock offered hereby,
prospective investors should carefully consider the following factors in
addition to the other information in this Prospectus.
Fluctuations in Quarterly Results; Future Operating Results Uncertain;
Seasonality
The Company's quarterly operating results have varied significantly in
the past and will likely vary significantly in the future depending on
numerous factors, several of which are not under the Company's control. Such
factors include, but are not limited to, demand for the Company's products
and those of its competitors, the size and rate of growth of the interactive
entertainment software market, development and promotional expenses relating
to the introduction of new products, changes in computing platforms, product
returns, the timing of orders from major customers, delays in shipment, the
level of price competition, the timing of product introduction by the Company
and its competitors, product life cycles, software defects and other product
quality problems, the level of the Company's international revenues, and
personnel changes. In particular, during the past few fiscal years the
Company's operating results for the quarters ended June 30 have been less
favorable than in other quarters as a result of the release of fewer new
products during the June 30 quarters in accordance with the Company's product
release schedules. Products are generally shipped as orders are received,
and consequently, the Company operates with little or no backlog. Net
revenues in any quarter are, therefore, substantially dependent on orders
booked and shipped in that quarter.
The Company's expenses are based in part on the Company's product
development and marketing budgets. Many of the costs incurred by the Company
to produce and sell its products are expensed as such costs are incurred,
which is often long before a product is released. In addition, a large
portion of the Company's expenses are fixed. As the Company increases its
production and sales activities, current expenses will increase and, if sales
from previously released products are below expectations, net income is
likely to be disproportionately affected.
Due to all of the foregoing, revenues and operating results for any
future quarter are not predictable with any significant degree of accuracy.
Accordingly, the Company believes that period-to-period comparisons of its
operating results are not necessarily meaningful and should not be relied
upon as indications of future performance.
The Company's business has experienced and is expected to continue to
experience significant seasonality, in part due to consumer buying patterns.
Net revenues typically are significantly higher during the fourth calendar
quarter, due primarily to the increased demand for consumer software during
the year-end holiday buying season. Net revenues in other quarters are
generally lower and vary significantly as a result of new product
introductions and other factors. The Company expects its net revenues and
operating results to continue to reflect significant seasonality.
Dependence On New Product Development; Product Delays
The Company's future success depends in part on the timely introduction
of successful new products to replace declining revenues from older products.
If, for any reason, revenues from new products were to fail to replace
declining revenues from older products, the Company's business, operating
results and financial condition would be materially and adversely affected.
In addition, the Company believes that the competitive factors in the
interactive entertainment software marketplace create the need for higher
quality, distinctive products that incorporate increasingly sophisticated
effects and the need to support product releases with increased marketing,
resulting in higher development, acquisition and marketing costs. The lack
of market acceptance or significant delay in the introduction of, or the
presence of a defect in, one or more products could have a material adverse
effect on the Company's business, operating results and financial condition,
particularly in view of the seasonality of the Company's business. Further,
because a large portion of a product's revenue generally is associated with
initial shipments, the delay of a product introduction expected near the end
of a fiscal quarter may have a material adverse effect on operating results
for that quarter.
The Company has, in the past, experienced significant delays in the
introduction of certain new products. The timing and success of interactive
entertainment products remain unpredictable due to the complexity of product
development, including the uncertainty associated with technological
developments. Although the Company has implemented substantial development
controls, there likely will be delays in developing and introducing new
products in the future. There can be no assurance that new products will be
introduced on schedule, or at all, or that they will achieve market
acceptance or generate significant revenues.
Reliance on Third Party Developers and Independent Contractors
The percentage of products published by the Company that are developed
by independent third party developers has increased over the last several
fiscal years. From time to time, the Company also utilizes independent
contractors for certain aspects of internal product development and
production. The Company has less control over the scheduling and the quality
of work by independent contractors and third party developers than that of
its own employees. A delay in the work performed by independent contractors
and third party developers or poor quality of such work may result in product
delays. Although the Company intends to continue to rely in part on products
that are developed primarily by its own employees, the Company's ability to
grow its business and its future operating results will depend, in
significant part, on the Company's continued ability to maintain
relationships with skilled independent contractors and third party
developers. There can be no assurance that the Company will be able to
maintain such relationships.
Uncertainty of Market Acceptance; Short Product Life Cycles
The market for entertainment systems and software has been characterized
by shifts in consumer preferences and short product life cycles. Consumer
preferences for entertainment software products are difficult to predict and
few entertainment software products achieve sustained market acceptance.
There can be no assurance that new products introduced by the Company will
achieve any significant degree of market acceptance, that such acceptance
will be sustained for any significant period, or that product life cycles
will be sufficient to permit the Company to recoup development, marketing and
other associated costs. In addition, if market acceptance is not achieved,
the Company could be forced to accept substantial product returns to maintain
its relationships with retailers and its access to distribution channels.
Failure of new products to achieve or sustain market acceptance or product
returns in excess of the Company's expectations may have a material adverse
effect on the Company's business, operating results and financial condition.
Product Concentration; Dependence On Hit Products
A key aspect of the Company's strategy is to focus its development and
acquisition efforts on selected, high quality entertainment software
products. The Company derives a significant portion of its revenues from a
select number of high quality entertainment software products released each
year, and many of these products have substantial production or acquisition
costs and marketing budgets. During fiscal 1997, two titles accounted for
approximately 23% and 16% respectively, of the Company's consolidated net
revenues. During fiscal 1998, one other title accounted for approximately
12% of the Company's consolidated net revenues. The Company anticipates that
a limited number of products will continue to produce a disproportionate
amount of revenues. Due to this dependence on a limited number of products,
the failure of one or more of the Company's principal new releases to achieve
anticipated results may have a material adverse effect on the Company's
business, operating results and financial condition.
The Company's strategy also includes as a key component developing and
releasing products that have franchise value, such that sequels, enhancements
and add-on products can be released over time, thereby extending the life of
the property in the market. While the focus on franchise properties, if
successful, results in extending product life cycles, it also results in the
Company depending on a limited number of titles for its revenues. There can
be no assurance that the Company's existing franchise titles can continue to
be exploited as successfully as in the past. In addition, new products that
the Company believes will have potential value as franchise properties may
not achieve market acceptance and therefore may not be a basis for future
releases.
Changes in Technology and Industry Standards
The consumer software industry is undergoing rapid changes, including
evolving industry standards, frequent new platform introductions and changes
in consumer requirements and preferences. The introduction of new
technologies, including operating systems such as Microsoft's Windows 98,
technologies that support multi-player games, and new media formats such as
on-line delivery and digital video disks ("DVD"), could render the Company's
previously released products obsolete or unmarketable. The development cycle
for products utilizing new operating systems, microprocessors or formats may
be significantly longer than the Company's current development cycle for
products on existing operating systems, microprocessors and formats and may
require the Company to invest resources in products that may not become
profitable. There can be no assurance that the mix of the Company's future
product offerings will keep pace with technological changes or satisfy
evolving consumer preferences, or that the Company will be successful in
developing and marketing products for any future operating system or format.
Failure to develop and introduce new products and product enhancements in a
timely fashion could result in significant product returns and inventory
obsolescence and could have a material adverse effect on the Company's
business, operating results and financial condition.
Limited Protection of Intellectual Property and Proprietary Rights; Risk of
Litigation
The Company holds copyrights on its products, manuals, advertising and
other materials and maintains trademark rights in the Company name, the
Activision logo, and the names of products owned by the Company. The Company
regards its software as proprietary and relies primarily on a combination of
trademark, copyright and trade secret laws, employee and third-party
nondisclosure agreements and other methods to protect its proprietary rights.
Unauthorized copying is common within the software industry, and if a
significant amount of unauthorized copying of the Company's products were to
occur, the Company's business, operating results and financial condition
could be adversely effected. There can be no assurance that third parties
will not assert infringement claims against the Company in the future with
respect to current or future products. As is common in the industry, from
time to time the Company receives notices from third parties claiming
infringement of intellectual property rights of such parties. The Company
investigates these claims and responds as it deems appropriate. Any claims
or litigation, with or without merit, could be costly and could result in a
diversion of management's attention, which could have a material adverse
effect on the Company's business, operating results and financial condition.
Adverse determinations in such claims or litigation could also have a
material adverse effect on the Company's business, operating results and
financial condition.
Policing unauthorized use of the Company's products is difficult, and
while the Company is unable to determine the extent to which piracy of its
software products exists, software piracy can be expected to be a persistent
problem. In selling its products, the Company relies primarily on "shrink
wrap" licenses that are not signed by licensees and, therefore, may be
unenforceable under the laws of certain jurisdictions. Further, the Company
enters into transactions in countries where intellectual property laws are
not well developed or are poorly enforced. Legal protections of the
Company's rights may be ineffective in such countries.
Risk of Software Defects
Software products such as those offered by the Company frequently
contain errors or defects. Despite extensive product testing, in the past
the Company has released products with defects and has discovered software
errors in certain of its product offerings after their introduction. In
particular, the PC hardware environment is characterized by a wide variety of
non-standard peripherals (such as sound cards and graphics cards) and
configurations that make pre-release testing for programming or compatibility
errors very difficult and time-consuming. There can be no assurance that,
despite testing by the Company, errors will not be found in new products or
releases after commencement of commercial shipments, resulting in a loss of
or delay in market acceptance, which could have a material adverse effect on
the Company's business, operating results and financial condition.
Industry Competition; Competition For Shelf Space
The interactive entertainment software industry is intensely
competitive. Competition in the industry is principally based on product
quality and features, the compatibility of products with popular platforms,
company or product line brand name recognition, access to distribution
channels, marketing effectiveness, reliability and ease of use, price and
technical support. Significant financial resources also have become a
competitive factor in the entertainment software industry, principally due to
the substantial cost of product development and marketing that is required to
support best-selling titles. In addition, competitors with broad product
lines and popular titles typically have greater leverage with distributors
and other customers who may be willing to promote titles with less consumer
appeal in return for access to such competitor's most popular titles.
The Company's competitors range from small companies with limited
resources to large companies with substantially greater financial, technical
and marketing resources than those of the Company. The Company's competitors
currently include Electronic Arts, LucasArts, Microsoft, Sega, Nintendo,
Sony, Cendant, GT Interactive, Midway, Interplay, Virgin and Eidos, among
many others.
As competition increases, significant price competition, increased
production costs and reduced profit margins may result. Prolonged price
competition or reduced demand would have a material adverse effect on the
Company's business, operating results and financial condition. There can be
no assurance that the Company will be able to compete successfully against
current or future competitors or that competitive pressures faced by the
Company will not have a material adverse effect on its business, operating
results and financial condition.
Retailers typically have a limited amount of shelf space, and there is
intense competition among entertainment software producers for adequate
levels of shelf space and promotional support from retailers. As the number
of entertainment software products increases, the competition for shelf space
has intensified, resulting in greater leverage for retailers and distributors
in negotiating terms of sale, including price discounts and product return
policies. The Company's products constitute a relatively small percentage of
a retailer's sale volume, and there can be no assurance that retailers will
continue to purchase the Company's products or promote the Company's products
with adequate levels of shelf space and promotional support.
Dependence on Distributors and Retailers; Risk of Customer Business Failure;
Product Returns
Certain mass market retailers have established exclusive buying
relationships under which such retailers will buy consumer software only from
one intermediary. In such instances, the price or other terms on which the
Company sells to such retailers may be adversely effected by the terms
imposed by such intermediary, or the Company may be unable to sell to such
retailers on terms which the Company deems acceptable. The loss of, or
significant reduction in sales attributable to, any of the Company's
principal distributors or retailers could materially adversely effect the
Company's business, operating results and financial condition.
Retailers in the computer industry have from time to time experienced
significant fluctuations in their businesses and there have been a number of
business failures among these entities. The insolvency or business failure
of any significant retailer or other wholesale purchaser of the Company's
products could have a material adverse effect on the Company's business,
operating results and financial condition. Sales are typically made on
credit, with terms that vary depending upon the customer and the nature of
the product. The Company does not hold collateral to secure payment.
Although the Company has obtained insolvency risk insurance to protect
against any bankruptcy filings that may be made by its customers, such
insurance contains a significant deductible as well as a co-payment
obligation, and the policy does not cover all instances of non-payment. In
addition, the Company maintains a reserve for uncollectible receivables that
it believes to be adequate, but the actual reserve which is maintained may
not be sufficient in every circumstance. As a result of the foregoing, a
payment default by a significant customer could have a material adverse
effect on the Company's business, operating results and financial condition.
The Company also is exposed to the risk of product returns from
retailers and other wholesale purchasers. Although the Company provides
reserves for returns that it believes are adequate, and although the
Company's agreements with certain of its customers place certain limits on
product returns, the Company could be forced to accept substantial product
returns to maintain its relationships with retailers and its access to
distribution channels. Product returns that exceed the Company's reserves
could have a material adverse effect on the Company's business, operating
results and financial condition.
Dependence on Key Personnel
The Company's success depends to a significant extent on the performance
and continued service of its senior management and certain key employees.
Competition for highly skilled employees with technical, management,
marketing, sales, product development and other specialized training is
intense, and there can be no assurance that the Company will be successful in
attracting and retaining such personnel. Specifically, the Company may
experience increased costs in order to attract and retain skilled employees.
Although the Company enters into term employment agreements with many of its
skilled employees and certain other key personnel, there can be no assurance
that such employees will not leave the Company or compete against the
Company. The Company's failure to attract or retain qualified employees
could have a material adverse effect on the Company's business, operating
results and financial condition.
Risks Associated With International Operations; Currency Fluctuations
International sales and licensing accounted for 23%, 58% and 67% of the
Company's total revenues in the fiscal years 1996, 1997 and 1998,
respectively and 69% of total revenues in the quarter ended June 30, 1998.
The Company intends to continue to expand its direct and indirect sales,
marketing and localization activities worldwide. Such expansion will require
significant management time and attention and financial resources in order to
develop adequate international sales and support channels. There can be no
assurance, however, that the Company will be able to maintain or increase
international market demand for its products. International sales are
subject to inherent risks, including the impact of possible recessionary
environments in economies outside the United States, the costs of
transferring and localizing products for foreign markets, longer receivable
collection periods and greater difficulty in accounts receivable collection,
unexpected changes in regulatory requirements, difficulties and costs of
staffing and managing foreign operations, and political and economic
instability. There can be no assurance that the Company will be able to
sustain or increase international revenues or that the foregoing factors will
not have a material adverse effect on the Company's future international
revenues and, consequently, on the Company's business, operating results and
financial condition. The Company currently does not engage in currency
hedging activities. Although exposure to currency fluctuations to date has
been insignificant, there can be no assurance that fluctuations in currency
exchange rates in the future will not have a material adverse impact on
revenues from international sales and licensing and thus the Company's
business, operating results and financial condition.
Risks Associated with Acquisitions
The Company is integrating the operations of its recently acquired
CentreSoft and NBG subsidiaries with its previously existing European
operations and the operations of its recently acquired Head Games subsidiary
with its previously existing domestic operations. This process, as well as
the process of managing three significant new operations, requires
substantial management time and effort and diverts the attention of
management from other matters. In addition, there is a risk of loss of key
employees, customers and vendors of the recently acquired operations as well
as existing operations as this process is implemented. There is no assurance
that the Company will be successful in integrating these operations or that,
if the operations are combined, there will not be adverse effects on its
business.
Consistent with its strategy to enhance distribution and product
development capabilities, the Company intends to continue to pursue
acquisitions of companies and intellectual property rights and other assets
that can be purchased or licensed on acceptable terms and which the Company
believes can be operated or exploited profitably. Some of these transactions
could be material in size and scope. While the Company will continually be
searching for appropriate acquisition opportunities, there can be no
assurance that the Company will be successful in identifying suitable
acquisitions. If any potential acquisition opportunities are identified,
there can be no assurance that the Company will consummate such acquisitions
or if any such acquisition does occur, that it will be successful in
enhancing the Company's business or be accretive to the Company's earnings.
As the entertainment software business continues to consolidate, the Company
faces significant competition in seeking acquisitions and may in the future
face increased competition for acquisition opportunities, which may inhibit
its ability to complete suitable transactions. Future acquisitions could
also divert substantial management time, could result in short term
reductions in earnings or special transaction or other charges and may be
difficult to integrate with existing operations or assets.
The Company may, in the future, issue additional shares of Common Stock
in connection with one or more acquisitions, which may dilute its
shareholders. Additionally, with respect to most of its future acquisitions,
the Company's shareholders may not have an opportunity to review the
financial statements of the entity being acquired, or to evaluate the
benefits of the intellectual property rights being purchased or licensed, or
to vote on any such acquisitions.
Risk of CentreSoft Vendor Defections; Vendor Concetration
The Company's recently acquired CentreSoft subsidiary performs software
distribution services in the United Kingdom and, via export, in other
European territories for a variety of entertainment software publishers, many
of which are competitors of the Company. These services are generally
performed under limited term contracts. While the Company expects to use
reasonable efforts to retain these vendors, there can be no assurance that
the Company will be successful in this regard. The cancellation or non-
renewal of one or more of these contracts could have a material adverse
effect on the Company's business, operating results and financial condition.
Three of CentreSoft's vendors accounted for 38.2%, 11.8% and 11.1%,
respectively, of CentreSoft's net revenues in fiscal year 1998. The net
revenues from these vendors represented 17.9%, 5.5% and 5.2%, respectively,
of total net revenues of the Company.
THE COMPANY
Activision is a leading international publisher, developer and
distributor of interactive entertainment software. The Company's products
span a wide range of product genres, including action, adventure, strategy
and simulation, and have included best selling titles such as MechWarrior 2,
Vigilante 8, Hexen II, Nightmare Creatures, Heavy Gear, Dark Reign, Pitfall
and Shanghai. Since its founding in 1979, the Company has published hundreds
of entertainment software products for a variety of personal computer and
console platforms.
The Company currently focuses its publishing, development and
distribution efforts on products designed for PCs, the Sony PlayStation
console system and the Nintendo 64 console system.
The Company's strategy includes the following elements:
Publish high quality titles. The Company seeks to differentiate its
titles through the highest quality production values and superior gaming
play, supported by comprehensive trade and consumer marketing programs
coordinated with product releases. Accordingly, the Company must support the
development, production, acquisition and marketing of its titles with the
resources necessary to create best selling products. In order to reduce the
financial risks associated with the higher development and marketing budgets
required to support this strategy, the Company pursues a combination of
internally and externally developed titles; products based on proven
technology and newer technology; and PC and console products.
Focus on franchise properties. The Company focuses its publishing and
developing activities principally on titles that are, or have the potential
to become, franchise properties with sustainable consumer appeal and brand
recognition. These titles can thereby serve as the basis for sequels,
prequels, mission packs and other add-ons and related new titles that can be
released over an extended period of time. The Company believes that the
publishing and distribution of products based in large part on franchise
properties will enhance revenue predictability. The Company currently is
publishing products based on several franchise properties, including Quake,
Hexen, Pitfall and Shanghai. The Company also has rights to several other
properties that it believes may have franchise value, including Heavy Gear,
Vigilante 8, Dark Reign, Battlezone, Heretic, Nightmare Creatures, Asteroids,
and Jack Nicklaus Golf.
Expand direct distribution capabilities. In North America, the
Company's products are sold primarily on a direct basis to major computer and
software retailing organizations, consumer electronic stores and discount
warehouses. In international territories, the Company's products are sold
both direct to retail and through third party distribution and licensing
arrangements. In order to maximize the revenues to be generated by each of
its products, the Company is expanding its worldwide direct distribution
capabilities. The Company believes that a dedicated internal sales force and
direct distribution to retailers provide significant competitive advantages,
including the ability to compete more effectively for shelf space, to create
additional point-of-sale promotional opportunities, to more properly manage
inventory levels, and to increase margins by eliminating third party
distributors. Consistent with this strategy, the Company has concluded two
acquisitions in the past twelve months in an effort to bolster its direct
distribution capabilities in international markets.
Continue to grow original equipment manufacturer ("OEM") revenues. The
Company also generates significant revenue throughout the world as a result
of arrangements with OEMs, in which the Company's titles are sold together
with hardware or peripheral devices manufactured by the OEM. The Company
believes that OEM bundle arrangements expand the distribution of its titles
to a broader and more diverse audience, and it intends to continue
aggressively pursuing these arrangements.
Enhance product flow. In order to expand the Company's library of
titles, intellectual property rights and talent base, the Company is actively
engaged in the exploration of acquisition opportunities in the software
development business. Consistent with this strategy, in June 1998 the
Company acquired Head Games, an entertainment software publisher based in St.
Paul, Minnesota that focuses on value priced lifestyle products, including
the best selling title Cabela's Big Game Hunter. Additionally, in August
1997 the Company acquired Raven Software Corporation ("Raven"), an
entertainment software developer based in Madison, Wisconsin that has created
numerous best selling titles, including Heretic, Hexen: Beyond Heretic and
Hexen II. In order to create a closer relationship with independent
developers, the Company also from time to time makes investments and acquires
minority equity interests in independent developers at the same time as it
acquires publishing rights to the developers' products.
The Company's principal executive offices are located at 3100 Ocean Park
Blvd., Santa Monica, California 90405, and its telephone number is (310) 255-
2000. The Company also maintains offices in the United Kingdom, France,
Germany, Japan, Australia, Madison, Wisconsin and St. Paul, Minnesota. The
Company's World Wide Web home page is located at http://www.activision.com.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Common Stock being offered hereby for the account of the Selling
Stockholders.
SELLING STOCKHOLDERS
The following table sets forth certain information regarding the
beneficial ownership of Common Stock by the Selling Stockholders as of August
10 , 1998, and the number of shares of Common Stock being offered by this
Prospectus.
Beneficial Ownership of
Common Stock Prior to
the Offering Number of
------------------------ Shares of
Number of Percentage Common Stock
Shares of Class(1) Being Offered
--------- ---------- -------------
Steven Foust
2905 Xanthus Lane North
Plymouth, MN 55447 435,000(2) 2.2% 420,000
Daniel Hammett
15612 Canyon Ridge
Eden Prairie, MN 55347 560,000(3) 2.8 310,000
Denis Sward
4650 Lexington Avenue
Ham Lake, MN 55304 230,000 1.1 230,000
Chad Koehler
3238 Kyle Avenue North
Golden Valley, MN 55422 40,000 (4) 40,000
All Selling Stockholders
as a group 1,265,000 6.3% 1,000,000
____________
(1) Percentages are based on 20,022,565 shares of Common Stock that were
issued and outstanding as of August 10, 1998.
(2) Includes 15,000 shares of Common Stock underlying options that are
exercisable within 60 days of the date of hereof.
(3) Includes 250,000 shares of Common Stock underlying options that are
exercisable within 60 days of the date of hereof.
(4) Less than 1%.
The Company has entered into an agreement and plan of reorganization
(the "Head Games Merger Agreement") with Head Games of which Steven Foust,
Daniel Hammett, Denis Sward and Chad Koehler were the sole shareholders. The
transaction contemplated by the Head Games Merger Agreement was consummated
on June 30, 1998. Pursuant to the Head Games Merger Agreement, the Head
Games Selling Stockholders agreed not to sell, pledge, gift, hypothecate or
otherwise dispose of the shares of Common Stock received in the transaction
until the issuance by the Company of its first earnings press release
containing at least thirty (30) days of combined operations of the Company
and Head Games. The Company estimates that this restriction on the transfer
of shares will lapse in October 1998.
In order to ensure that the representations, warranties and covenants
made by the Head Games stockholders under the Head Games Merger Agreement are
not breached, and in order to provide a source of indemnification to the
Company pursuant to such agreement, each of the former Head Games
stockholders deposited in escrow pursuant to a warranty escrow agreement ten
percent (10%) of the total number of shares of Common Stock issued to each
stockholder in connection with the transaction, an aggregate of 100,000
shares of Common Stock, to be held until the earlier of (i) the date on which
the first audited results of the combined enterprises' financial statements
is completed, (2) June 30, 1999, or (3) the date set forth in a joint written
direction executed by the Company and the former Head Games stockholders.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of 55,000,000
shares of capital stock, $.000001 par value, consisting of 50,000,000 shares
of Common Stock and 5,000,000 shares of preferred stock. As of August 10,
1998, approximately 20,022,565 shares of Common Stock were outstanding. The
Common Stock is listed in the NASDAQ National Market System under the symbol
"ATVI."
Each outstanding share of Common Stock entitles the holder to one vote
on all matters submitted to a vote of stockholders, including the election of
directors. There is no cumulative voting in the election of directors, which
means that the holders of a majority of the outstanding shares of Common
Stock can elect all of the directors then standing for election. Subject to
preferences which may be applicable to any outstanding shares of preferred
stock, holders of Common Stock are entitled to such distributions as may be
declared from time to time by directors of the Company out of funds legally
available therefor. The Company has not paid, and has no current plans to
pay, dividends on its Common Stock. The Company intends to retain all
earnings for use in its business.
Holders of Common Stock have no conversion, redemption or preemptive
rights to subscribe to any securities of the Company. All outstanding shares
of Common Stock are fully paid and nonassessable. In the event of any
liquidation, dissolution or winding-up of the affairs of the Company, holders
of Common Stock will be entitled to share ratably in the assets of the
Company remaining after provision for payment of liabilities to creditors and
preferences applicable to outstanding shares of preferred stock.
The rights, preferences and privileges of holders of Common Stock are
subject to the rights of the holders of any outstanding shares of preferred
stock. At present, no shares of preferred stock are outstanding. As of
August 10, 1998, the Company had approximately 5,000 stockholders of record,
excluding banks, brokers and depository companies that are stockholders of
record for the account of beneficial owners.
The transfer agent for the Common Stock of the Company is Continental
Stock Transfer & Trust Company, 2 Broadway, New York, New York 10004.
PLAN OF DISTRIBUTION
The Common Stock may be sold from time to time by the Selling
Stockholders, or by pledgees, donees, transferees or other successors in
interest. Such sales may be made on one or more exchanges or in the
over-the-counter market, or otherwise, at prices and at terms then prevailing
or at prices related to the then current market price, or in negotiated
transactions. The shares may be sold by one or more of the following,
without limitation: (a) a block trade in which the broker or dealer so
engaged will attempt to sell the shares as agent but may position and resell
a portion of the block as principal to facilitate the transaction, (b)
purchases by a broker or dealer as principal and resale by such broker or
dealer or for its account pursuant to the Prospectus, as supplemented, (c) an
exchange distribution in accordance with the rules of such exchange, and (d)
ordinary brokerage transactions and transactions in which the broker solicits
purchasers. In addition, any securities covered by this Prospectus which
qualify for sale pursuant to Rule 144 may be sold under Rule 144 rather than
pursuant to this Prospectus, as supplemented. From time to time the Selling
Stockholders may engage in short sales, short sales against the box, puts and
calls and other transactions in securities of the Company or derivatives
thereof, and may sell and deliver the shares in connection therewith.
From time to time Selling Stockholders may pledge their shares pursuant
to the margin provisions of their respective customer agreements with their
respective brokers. Upon a default by a Selling Stockholder, the broker may
offer and sell the pledged shares of Common Stock from time to time as
described above.
All expenses of registration of the Common Stock (other than commissions
and discounts of underwriters, dealers or agents), estimated to be
approximately $18,500, shall be borne by the Company. As and when the
Company is required to update this Prospectus, it may incur additional
expenses in excess of this estimated amount.
LEGAL MATTERS
Certain legal matters in connection with the shares of Common Stock
offered hereby have been passed upon for the Company by Robinson Silverman
Pearce Aronsohn & Berman LLP, New York, New York.
EXPERTS
The consolidated financial statements and financial statement schedule
of the Company and its subsidiaries as of March 31, 1998 and 1997 and for
each of the years in the three year period ended March 31, 1998, have been
incorporated by reference herein and in the registration statement in
reliance upon the report of KPMG Peat Marwick LLP, independent certified
public accountants, incorporated by reference herein, and upon the authority
of said firm as experts in accounting and auditing.
AVAILABLE INFORMATION
The Company is subject to the informational 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 "SEC"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the SEC at its offices at Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the
regional offices of the SEC located at Seven World Trade Center, New York,
New York 10048 and at Northwestern Atrium Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661-2511. Copies of such materials can be
obtained by mail from the Public Reference Section of the SEC at Judiciary
Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates,
and can also be obtained electronically through the SEC's Electronic Data
Gathering, Analysis and Retrieval system at the SEC's Web site
(http://www.sec.gov). The Company's Common Stock is listed on the Nasdaq
National Market and copies of such reports and other information can also be
inspected at the offices of the Nasdaq National Market, 1735 K Street, N.W.,
Washington, D.C. 20006.
The Company has filed with the SEC a registration statement on Form S-3
(herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"), and the rules and regulations promulgated thereunder, with
respect to the Common Stock offered hereby. This Prospectus, which
constitutes a part of the Registration Statement, does not contain all of the
information set forth in the Registration Statement and the exhibits and
schedules thereto, as permitted by the rules and regulations of the SEC. For
further information with respect to the Company and the Common Stock offered
hereby, reference is made to the Registration Statement, including the
exhibits thereto and the financial statements, notes and schedules filed as a
part thereof, which may be inspected and copied at the public reference
facilities of the SEC referred to above. Statements contained in this
Prospectus as to the contents of any contract or other document are not
necessarily complete, and in each instance reference is made to the full text
of such contract or document filed as an exhibit to the Registration
Statement, each such statement being qualified in all respects by such
reference.
The Company furnishes stockholders with annual reports containing
audited financial statements and with proxy material for its annual meetings
complying with the proxy requirements of the Exchange Act.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents which have been filed by the Company with the
SEC are incorporated in this Prospectus by reference:
1. The Company's Annual Report on Form 10-K for the year ended March
31, 1998, which contains audited consolidated balance sheets of the Company
and subsidiaries as of March 31, 1998 and 1997, and related consolidated
statements of operations, changes in shareholders' equity and cash flows for
each of the years in the three year period ended March 31, 1998.
2. The Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1998, filed with the Commission on August 14, 1998.
3. The Company's Current Report on Form 8-K filed with the Commission on
July 1, 1998.
4. Description of the Company's Common Stock contained in the Company's
Registration Statement on Form S-3, Registration No. 333-46425.
5. All other reports filed by the Company pursuant to Section 13(a) or
15(d) of the Exchange Act since March 31, 1998.
All reports and other documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to
the filing of a post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in and to
be a part of this Prospectus from the date of filing of such reports and
documents.
Any statement contained herein or in a document which is incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement in any subsequently filed
document that is also deemed to be incorporated by reference herein modifies
or supersedes such prior statement.
This Prospectus incorporates documents by reference which are not
presented or delivered herewith. These documents are available upon written
or oral request from the Company, without charge, to each person to whom a
copy of this Prospectus has been delivered, other than exhibits to those
documents. Requests should be directed to the Office of the Secretary,
Activision, Inc., 3100 Ocean Park Boulevard, Santa Monica, California 90405
(telephone (310) 255-2000).
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements included or incorporated by reference into this
Prospectus constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. All such forward-looking
statements involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of the
Company, or industry results, to be materially different from any future
results, performance, or achievements expressed or implied by such forward-
looking statements. Such factors include the various matters described
herein under "Risk Factors" and various other factors described in the
Company's other filings with the Commission.
SPECIAL NOTE REGARDING THE YEAR 2000 PROBLEM
Many computer systems and applications currently use two digits to
define the applicable year. As a result, date-sensitive systems may
recognize the year 2000 as 1900 or not at all, which could cause
miscalculations or system failures.
The Company has assessed its computerized systems to determine their
ability to correctly identify the year 2000 and is devoting the necessary
internal and external resources to replace, upgrade or modify all significant
systems which do not correctly identify the year 2000. The Company
anticipates that all of its systems will be year 2000 compliant well before
the end of 1999. In addition, the Company has determined the extent to which
its operations may be affected by the compliance efforts of its significant
suppliers and is taking the necessary steps to minimize the problems.
Based on current information, the costs of addressing the year 2000
issue have not and are not expected to have a material adverse impact on the
Company's financial position, results of operations or cash flows.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
=============================================================================
No dealer, salesman or other person has been authorized to give any
information or to make representations other than those contained in this
Prospectus, and if given or made, such information or representations must
not be relied upon as having been authorized by the Company or the Selling
Stockholders. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create an implication that the
information herein is correct as of any time subsequent to its date. This
Prospectus does not constitute an offer of solicitation by anyone in any
jurisdiction in which such offer or solicitation is not authorized or in
which the person making such offer of solicitation is not qualified to do so
or to anyone to whom it is unlawful to make such offer or solicitation.
-----------------------
TABLE OF CONTENTS
Page
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
The Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Selling Stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Description of Capital Stock . . . . . . . . . . . . . . . . . . . . . . . 11
Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Legal Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Available Information. . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Documents Incorporated by Reference. . . . . . . . . . . . . . . . . . . . 13
Special Note Regarding Forward-Looking Statements . . . . . . . . . . . . 14
Special Note Regarding The Year 2000 Problem . . . . . . . . . . . . . . . 14
=============================================================================
=============================================================================
1,000,000 Shares
ACTIVISION, INC.
Common Stock
----------
PROSPECTUS
----------
_____________, 1998
=============================================================================
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table itemizes the expenses incurred by the Company
in connection with the offering of the Common Stock being registered. All
the amounts shown are estimates except the Securities and Exchange Commission
(the "Commission") registration fee.
Item Amount
---- ------
Registration Fee - Securities and Exchange Commission. . . . $3,447
Legal Fees and Expenses. . . . . . . . . . . . . . . . . . . 7,500
Accounting Fees and Expenses . . . . . . . . . . . . . . . . 5,000
Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . 2,500
------
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . $18,447
======
Item 15. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law ("DGCL"), paragraph
B of Article SIXTH of the Company's Amended and Restated Certificate of
Incorporation and paragraph 5 of Article VII of the Company's By-laws provide
for the indemnification of the Company's directors and officers in a variety
of circumstances, which may include liabilities under the Securities Act of
1933, as amended (the "Securities Act").
Paragraph B of Article SIXTH of the Amended and Restated Certificate of
Incorporation provides mandatory indemnification rights to any officer or
director of the Company who, by reason of the fact that he or she is an
officer or director of the Company, is involved in a legal proceeding of any
nature. Such indemnification rights shall include reimbursement for expenses
incurred by such officer or director in advance of the final disposition of
such proceeding in accordance with the applicable provisions of the DGCL.
Paragraph 5 of Article VII of the Company's By-laws currently provide that
the Company shall indemnify its directors and officers to the fullest extent
permitted by the DGCL.
Paragraph A of Article SIXTH of the Amended and Restated Certificate of
Incorporation contains a provision which eliminates the personal liability of
a director to the Company and its stockholders for certain breaches of his or
her fiduciary duty of care as a director. This provision does not, however,
eliminate or limit the personal liability of a director (i) for any breach of
such director's duty of loyalty to the Company or its stockholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (iii) under the Delaware statutory provision
making directors personally liable, under a negligence standard, for unlawful
dividends or unlawful stock repurchases or redemptions, or (iv) for any
transaction from which the director derived an improper personal benefit.
This provision offers persons who serve on the Board of Directors of the
Company protection against awards of monetary damages resulting from
negligent (except as indicated above) and "grossly" negligent actions taken
in the performance of their duty of care, including grossly negligent
business decisions made in connection with takeover proposals for the
Company. As a result of this provision, the ability of the Company or a
stockholder thereof to successfully prosecute an action against a director
for a breach of his duty of care has been limited. However, the provision
does not affect the availability of equitable remedies such as an injunction
or rescission based upon a director's breach of his duty of care.
It is currently unclear as a matter of law what impact these provisions
will have regarding securities law violations. The Commission takes the
position that indemnification of directors, officers and controlling persons
against liabilities arising under the Securities Act is against public policy
as expressed in the Securities Act and therefore is unenforceable.
Item 16. Exhibits
(a) Exhibits:
4.1 Articles of Merger, with the Plan of Merger annexed thereto, as
filed with the Secretary of State of the State of Minnesota on June
30, 1998 (incorporated by reference to the Company's Current Report
on Form 8-K filed with the Commission on July 1, 1998).
* 5.1 Opinion of Robinson Silverman Pearce Aronsohn & Berman LLP as to
the legality of securities being registered.
* 23.1 Consent of Robinson Silverman Pearce Aronsohn & Berman LLP
(included as part of Exhibit 5.1).
* 23.2 Consent of KPMG Peat Marwick LLP.
* 24.1 Power of attorney (included on signature page).
______________
* Filed previously.
Item 17. Undertakings
The Company 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;
(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 registration statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by
the Company pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, 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.
The Company hereby further undertakes that, for purposes of determining
any liability under the Securities Act, each filing of the Company's annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) 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.
The Company hereby further undertakes to deliver or cause to be
delivered with the Prospectus, to each person to whom the Prospectus is sent
or given, the latest annual report to security holders that is incorporated
by reference in the Prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Exchange Act; and, where
interim financial information required to be presented by Article 3 of
Regulation S-X are not set forth in the Prospectus, to deliver, or cause to
be delivered to each person to whom the Prospectus is sent or given, the
latest quarterly report that is specifically incorporated by reference in the
Prospectus to provide such interim financial information.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the Company has
been advised that in the opinion of the Commission such indemnification 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 a director, officer or controlling person of the Company 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 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Los Angeles, State of
California, on August 26, 1998.
ACTIVISION, INC.
By:* /s/ Robert A. Kotick
----------------------------
Robert A. Kotick, Chairman and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
*/s/ Robert A. Kotick Chairman, Chief Executive Officer August 26, 1998
- ----------------------- (Principal Executive Officer)
(Robert A. Kotick) and Director
/s/ Brian G. Kelly Chief Operating Officer, President August 26, 1998
- ----------------------- and Director
(Brian G. Kelly)
*/s/ Barry J. Plaga Chief Financial Officer (Principal August 26, 1998
- ----------------------- Financial and Accounting Officer)
(Barry J. Plaga)
*/s/ Harold A. Brown Director August 26, 1998
- -----------------------
(Harold A. Brown)
*/s/ Barbara S. Isgur Director August 26, 1998
- -----------------------
(Barbara S. Isgur)
*/s/ Steven T. Mayer Director August 26, 1998
- -----------------------
(Steven T. Mayer)
*/s/ Robert J. Morgado Director August 26, 1998
- -----------------------
(Robert J. Morgado)
*By:/s/ Brian G. Kelly
- -----------------------
Brian G. Kelly
(Attorney-in-fact)
EXHIBIT INDEX
Page Number
in Signed
Registration
Exhibit No. Description Statement
4.1 Articles of Merger, with the Plan of Merger annexed
thereto, as filed with the Secretary of State of
the State of Minnesota on June 30, 1998
(incorporated by reference to the Company's Current
Report on Form 8-K filed with the Commission on
July 1, 1998).
* 5.1 Opinion of Robinson Silverman Pearce
Aronsohn & Berman LLP as to the legality
of securities being registered.
* 23.1 Consent of Robinson Silverman Pearce Aronsohn &
Berman LLP (included as part of Exhibit 5.1).
* 23.2 Consent of KPMG Peat Marwick LLP.
* 24.1 Power of attorney (included on signature
page).
_________________
* Filed previously.