FILED PURSUANT TO RULE 424(B)(2)
REGISTRATION NO. 333-66126
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED NOVEMBER 26, 2001)
GENERAL MAGIC, INC.
33,333,333 SHARES OF COMMON STOCK
You should read this prospectus supplement, the accompanying base
prospectus dated November 26, 2001, our prospectus supplement on Form 424(b)(2)
dated as of December 3, 2002, the accompanying Amendment No. 2 to our Quarterly
Report on Form 10-Q for the quarter ended September 30, 2001 and the other
documents incorporated by reference into this prospectus supplement and our base
prospectus carefully before you invest. These documents contain information you
should consider carefully before making your investment decision. You should
rely only on the information contained or incorporated by reference in this
prospectus supplement and the accompanying prospectus. We have not authorized
anyone else to provide you with different or additional information.
This prospectus supplement and the accompanying prospectus do not
constitute an offer to sell or a solicitation of an offer to buy any securities
other than the common stock offered hereby. This prospectus supplement and the
accompanying prospectus do not constitute an offer to sell or a solicitation of
an offer to buy our common stock in any circumstances in which an offer or
solicitation is unlawful.
Information in this prospectus supplement replaces any inconsistent
information in the base prospectus, as amended. Information in this prospectus
supplement and the accompanying prospectus may change after the date on the
front of the applicable document. You should not interpret the delivery of this
prospectus supplement or the accompanying prospectus or the sale of the common
stock as an indication that there has been no change in our affairs since that
date.
Our principal executive offices are located at 420 North Mary Avenue,
Sunnyvale, California 94085. Our telephone number is (408) 774-4000.
AN INVESTMENT IN OUR SECURITIES INVOLVES SUBSTANTIAL RISKS. THESE RISKS
ARE DESCRIBED UNDER THE CAPTION "RISK FACTORS" BEGINNING ON PAGE 8 OF THE BASE
PROSPECTUS ACCOMPANYING THIS PROSPECTUS SUPPLEMENT.
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HYPERION PARTNERS CORP.
Hyperion Partners is not required to sell
any specific number or dollar amount of
securities but will use its best efforts
to sell the securities offered.
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We are offering an aggregate of 33,333,333 shares of our common stock to
institutional investors and certain individuals pursuant to this prospectus
supplement. The purchase price for these shares of common stock is $7,000,000 in
the aggregate, or $0.21 per share.
Our common stock is quoted on the Nasdaq National Market under the symbol
"GMGC". On March 25, 2002, the last reported sales price of our common stock as
quoted on the Nasdaq National Market was $0.25 per share.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER REGULATORY
BODY HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE RELATED PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus supplement is March 26, 2002.
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RECENT DEVELOPMENTS
Based upon the Company's current cash position and the total amount
of proceeds that the Company may receive in this financing, the Company
expects to receive a "going concern" opinion on its Annual Report on Form
10-K.
THE OFFERING
Common stock offered in this
prospectus........................... 33,333,333 shares
Common stock outstanding after
the offering......................... 126,315,964 shares(1)
Use of proceeds......................... For product development, capital
expenditure, sales and marketing
and for other general corporate
purposes. See "Use of Proceeds."
Nasdaq National Market symbol........... GMGC
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(1) Based on shares outstanding as of March 21, 2002. Does not include
10,005,361 shares of common stock issuable upon exercise of outstanding
options, 9,916,149 shares of common stock issuable upon conversion of
outstanding preferred stock or 4,445,484 shares of common stock issuable
upon exercise of outstanding warrants as of March 21, 2002.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Some of the statements in this prospectus supplement and the documents
incorporated by reference are forward-looking statements. These forward-looking
statements are subject to certain risks and uncertainties, including, among
others, those listed under "Risk Factors" above and in the documents
incorporated by reference.
In some cases, you can identify forward-looking statements by words such
as "anticipates," "believes," "estimates," "seeks," expects," "plans,"
"intends," "future" and similar expressions.
Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, events, levels of
activity, performance, or achievements and therefore such expectations may be
incorrect. You are cautioned not to place undue reliance on these
forward-looking statements.
All subsequent written and oral forward-looking statements attributable to
us or to persons acting on our behalf are expressly qualified in their entirety
by our cautionary statements. The forward-looking statements included or
incorporated herein are made only as of the date of this prospectus supplement,
or as of the date of the documents incorporated by reference. We do not intend,
and undertake no obligation, to update these forward-looking statements.
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PLAN OF DISTRIBUTION
ISSUANCES OF SHARES OF COMMON STOCK BY US
We engaged Hyperion Partners Corp. ("Hyperion") on November 7, 2001 to act
as our non-exclusive placement agent for the offering of shares of our common
stock, par value $0.001 per share, to investors who may wish to purchase our
common stock from time to time on specific terms to be negotiated between us and
such investors. This engagement is scheduled to expire on May 6, 2002, unless
extended by the parties. The securities will be offered by us pursuant to
prospectus supplements to our base prospectus, dated November 26, 2001, as
supplemented or amended from time to time. Hyperion is not committed to purchase
any of our securities, regardless of whether Hyperion does or does not
successfully identify others to purchase our securities. We, in turn, are not
obligated to sell any of our securities to any prospective purchaser
successfully identified by Hyperion.
Pursuant to our engagement agreement with Hyperion, Hyperion has
identified 10 institutional investors and 2 individuals that will be included in
this offering.
We have agreed to pay Hyperion a cash placement fee equal to 4% of the
gross proceeds to General Magic from each such sale.
We also paid to Hyperion a $10,000 commencement bonus, and we agreed to
reimburse Hyperion for certain expenses up to a maximum of $15,000.
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
Page
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THE OFFERING 3
SPECIAL NOTE REGARDING
FORWARD-LOOKING STATEMENTS 3
PLAN OF DISTRIBUTION 4
PROSPECTUS
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Page
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RECENT DEVELOPMENTS 3
SUMMARY 4
ABOUT GENERAL MAGIC 4
SECURITIES TO BE OFFERED 7
RISK FACTORS 8
SPECIAL NOTE REGARDING
FORWARD-LOOKING STATEMENTS 19
USE OF PROCEEDS 19
SELLING STOCKHOLDERS 20
PLAN OF DISTRIBUTION 21
GENERAL DESCRIPTION OF THE SECURITIES 25
DESCRIPTION OF COMMON STOCK 25
DESCRIPTION OF PREFERRED STOCK 25
DESCRIPTION OF WARRANTS 28
LEGAL MATTERS 29
EXPERTS 29
WHERE YOU CAN FIND MORE INFORMATION 29
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