From the prospectus dated 9/26/97-
"All of the Common Shares offered hereby (the "Offering") may be sold by
certain Selling Security Holders (the "Selling Security Holders") of WavePhore,
Inc. ("WavePhore" or the "Company"). Pursuant to Rule 416 under the Securities
Act of 1933, as amended (the "Securities Act"), the number of Common Shares
offered hereby (the "Common Shares") includes such presently indeterminate
number of Common Shares as may be issued on conversion of the Company's Series C
Convertible Preferred Stock (the "Series C Preferred Shares"), as a dividend,
payment of a redemption price or otherwise pursuant to the provisions thereof
regarding determination of the applicable conversion price, including
adjustments to the conversion price to prevent dilution resulting from stock
splits, stock dividends or similar transactions, or by reason of reductions in
the conversion price in accordance with the terms thereof (including, but not
limited to, the terms which cause the variable conversion price thereof to
decrease to the extent the market price of the Company's Common Shares
declines). In addition, the Company has agreed to register 175% of the Common
Shares issuable upon conversion of the Series C Preferred Shares at the Fixed
Conversion Price (defined below) and exercise of the related Warrants issued on
July 24, 1997. Until January 23, 1998, six months after the date of issuance of
the Series C Preferred Shares, the applicable conversion price is $8.80 ("Fixed
Conversion Price"), which is equal to 115% of the average closing sale prices of
the Company's Common Shares for the five trading days prior to but not including
the date of issuance. The Fixed Conversion Price may be extended up to six
months if the Company satisfies certain conditions in its Articles of Amendment.
If the Fixed Conversion Price of the Common Shares were used to determine the
number of Common Shares issuable as of the first date on which the Series C
Preferred Shares may be converted, the Company would be obligated to issue a
total of approximately 2,727,275 Common Shares if all 24,000 Series C Preferred
Shares outstanding on the date of this Prospectus were to be converted. An
additional 545,454 Common Shares may be purchased upon exercise of presently
outstanding Warrants sold to the Selling Security Holders simultaneously with
the purchase of the Series C Preferred Shares. The 545,454 Common Shares
purchasable upon exercise of the Warrants also may be offered by the Selling
Security Holders. See "Selling Security Holders." The Company will not receive
any of the proceeds from the sale of Common Shares by the Selling Security
Holders, although the Company will receive up to $4,799,995 upon exercise of the
Warrants. The Selling Security Holders may elect to sell all, a portion, or none
of the Common Shares registered hereby. "
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