From edgar-online.com
POTENTIAL ADVERSE MARKET IMPACT OF SHARES ELIGIBLE FOR FUTURE SALE. Sales of substantial amounts of the Common Stock in the public market after the Offering could adversely affect the market price of the Common Stock. Upon completion of the Offering, the Company will have outstanding 10,256,981 shares of Common Stock (including shares to be issued upon conversion of the Convertible Preferred Stock upon completion of the Offering). All of the 2,500,000 shares sold in the Offering will be freely transferable as of the date of this Prospectus by persons other than "affiliates" of the Company without restriction or further registration under the Securities Act. The remaining
7,756,981 shares of Common Stock that will be outstanding upon completion of the Offering (the "Restricted Shares") will be held by officers, directors, employees, consultants and other stockholders of the Company. The Restricted Shares were sold by the Company in reliance on exemptions from the registration requirements of the Securities Act and are "restricted securities" under the
Securities Act. The officers, directors, employees and certain stockholders of the Company, who together hold the Restricted Shares, have agreed not to sell their shares without the consent of Merrill Lynch, Pierce, Fenner & Smith Incorporated for a period of 180 days from the date of this Prospectus. Certain holders of shares of Common Stock and securities convertible into or exercisable for shares of Common Stock have certain registration rights under a registration rights agreement among such holders and the Company. The shares of Common Stock covered by these registration rights include: the 6,880,791 shares of Common Stock which will be issued upon conversion of the Convertible Preferred Stock upon completion of the Offering; and the 160,187 shares of Common Stock issuable upon conversion of the Convertible Preferred Stock for which warrants are exercisable. These registration rights have been waived in connection with the Offering but will, subject to the agreements not to sell referred to above, continue to apply to the aforementioned shares of Common Stock upon completion of the Offering. In addition, the Company intends to register approximately 1,380,000 shares of Common Stock subject to outstanding stock options or reserved for issuance under the Company's stock option plans and employee stock purchase plan following completion of the Offering. See "Management -- Employee Benefit Plans" and "Shares Eligible for Future Sale."
Note this was filed May 1996, so 180 days expired long ago. |
