As filed with the Securities and Exchange Commission on July 10, 1996
File No. 333-_______
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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DCC COMPACT CLASSICS, INC.
(Exact name of issuer as specified in its charter)
Colorado 84-1046186
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
9301 Jordan Avenue
Suite 105
Chatsworth, California 91311
(Address of principal executive offices) (Zip Code)
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CONSULTING AND STOCK OPTION AGREEMENT WITH GARY GILLMAN
COMMON STOCK PURCHASE WARRANT WITH MARSHALL BLONSTEIN
(Full title of the plan)
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Marshall Blonstein
9301 Jordan Avenue, Suite 105
Chatsworth, California 91311
(Name and address of agent for service)
Copy to:
Jim Schneider, Esq.
Atlas, Pearlman, Trop & Borkson, P.A.
200 East Las Olas Boulevard, Suite 1900
Fort Lauderdale, Florida 33301
(305) 763-1200
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CALCULATION OF REGISTRATION FEE
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Proposed Proposed
maximum maximum
offering aggregate Amount of
Title of securities Amount to be price per offering registration
to be registered registered(1) share(1) price(1) fee(2)
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Common Stock
($.005 par value)
10,000 shares $.10 $ 1,000 $ .34
200,000 shares $.13 $ 26,000 $ 8.97
200,000 shares $.13 $ 26,000 $ 8.97
--------
$ 53,000 $100.00
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(1) Pursuant to Rule 457(h), the maximum offering price was calculated based
upon the exercise price of the Options described herein.
(2) The registration fee represents the minimum prescribed fee.
ii
DCC COMPACT CLASSICS, INC.
CROSS REFERENCE SHEET REQUIRED BY ITEM 501(b) OF REGULATION S-K
Form S-8 Item Number
and Caption Caption in Prospectus
-------------------- ---------------------
1. Forepart of Registration State- Facing Page of Registration
ment and Outside Front Cover Statement and Cover Page of
Page of Prospectus Prospectus
2. Inside Front and Outside Back Inside Cover Page of Pro-
Cover Pages of Prospectus spectus and Outside Cover
Page of Prospectus
3. Summary Information, Risk Fac- Not Applicable
tors and Ratio of Earnings to
Fixed Charges
4. Use of Proceeds Not Applicable
5. Determination of Offering Price Not Applicable
6. Dilution Not Applicable
7. Selling Security Holders Sales by Selling Security
Holders
8. Plan of Distribution Cover Page of Prospectus
and Sales by Selling
Security Holders
9. Description of Securities to be Description of Securities;
Registered Consulting and Stock
Option Agreement with
Gary Gillman and Warrant
with Marshall Blonstein.
10. Interests of Named Experts and Not Applicable
Counsel
11. Material Changes Not Applicable
12. Incorporation of Certain Infor- Incorporation of Certain
mation by Reference Documents by Reference
13. Disclosure of Commission Posi- Indemnification; Undertak-
tion on Indemnification for ings
Securities Act Liabilities
iii
PROSPECTUS
DCC COMPACT CLASSICS, INC.
410,000 Shares of Common Stock
($.005 par value)
Issued Pursuant to Exercise of
Options under the Company's
Consulting and Stock Option Agreement with Gary Gillman
and Warrants under the Company's Common Stock Purchase Warrant
with Marshall Blonstein
This Prospectus is part of a Registration Statement which registers an
aggregate 410,000 shares of Common Stock ("Common Stock"), $.005 par value (such
shares being referred to as the "Shares") of DCC Compact Classics, Inc. (the
"Company") which may be issued upon the exercise of certain options and
warrants, as set forth herein, to: (i) Gary Gillman, a consultant to and
director of the Company, pursuant to a written Consulting and Stock Option
Agreement dated March 8, 1996 (the "Gillman Option Agreement"), providing for
the issuance of options to purchase shares of Common Stock, 10,000 of which are
being registered hereby;and (ii) Marshall Blonstein, the CEO, President and a
director of the Company ("Blonstein"), pursuant to a written Common Stock
Purchase Warrant dated April 1, 1994, as amended (the "Blonstein Warrant"),
providing for the issuance of warrants to purchase shares of Common Stock,
200,000 of which are being registered hereby. Gillman and Blonstein in their
capacity as selling shareholders, may sometimes hereafter be collectively
referred to as the "Selling Security Holders." The Company has been advised by
the Selling Security Holders that each of them may sell all or a portion of the
Shares from time to time in the over-the-counter market in negotiated
transactions, directly or through brokers or otherwise, and that such shares
will be sold at market prices prevailing at the time of such sales or at
negotiated prices, and the Company will not receive any proceeds from such
sales.
No person has been authorized by the Company to give any information or to
make any representation other than as contained in this Prospectus, and if given
or made, such information or representation must not be relied upon as having
been authorized by the Company. Neither the delivery of this Prospectus nor any
distribution of the shares of the Gillman Incentive Stock nor the Blonstein
Incentive Stock issuable pursuant to the terms of the Option Agreement or the
Blonstein Warrant, respectively, shall, under any circumstances, create any
implication that there has been no change in the affairs of the Company since
the date hereof.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION (THE "COMMISSION") NOR HAS THE COMMISSION PASSED ON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL SECURITIES IN ANY
STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH STATE.
The date of this Prospectus is July 10, 1996.
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 "Commission"). Reports, proxy statements
and other information filed with the Commission can be inspected and copied at
the public reference facilities of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Copies of this material can also be obtained at
prescribed rates from the Public Reference Section of the Commission at its
principal office at 450 Fifth Street, N.W., Washington, D.C. 20549. The
Company's Common Stock is traded in the over-the-counter market on NASDAQ under
the symbol "DCCC."
The Company has filed with the Commission a Registration Statement on Form
S-8 (the "Registration Statement") under the Securities Act of 1933, as amended
(the "Act"), with respect to the resale of up to an aggregate of 410,000 shares
of the Company's Common Stock, to be issued to a consultant and directors of the
Company upon exercise of certain options and warrants pursuant to the written
Gillman Option Agreement and the Blonstein Warrant. This Prospectus, which is
Part I of the Registration Statement, omits certain information contained in the
Registration Statement. For further information with respect to the Company and
the shares of the Common Stock offered by this Prospectus, reference is made to
the Registration Statement, including the exhibits thereto. Statements in this
Prospectus as to any document are not necessarily complete, and where any such
document is an exhibit to the Registration Statement or is incorporated by
reference herein, each such statement is qualified in all respects by the
provisions of such exhibit or other document, to which reference is hereby made,
for a full statement of the provisions thereof. A copy of the Registration
Statement, with exhibits, may be obtained from the Commission's office in
Washington, D.C. (at the above address) upon payment of the fees prescribed by
the rules and regulations of the Commission, or examined there without charge.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference and made a part hereof:
1. The Company's Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1994.
2. The Company's Form 10-QSB Quarterly Report for the quarterly period
ended March 31, 1995.
2
3. The Company's Form 10-QSB Quarterly Report for the quarterly period
ended June 30, 1995.
4. The Company's Form 10-QSB Quarterly Report for the quarterly period
ended September 30, 1995.
5. The Company's Form 10-KSB Annual Report for the year
ended December 31, 1995.
All reports and documents filed by the Company pursuant to Section 13, 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 herein and to be a part hereof from the respective
date of filing of such documents. Any statement incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein or in any other subsequently filed
document, which also is or is deemed to be incorporated by reference herein,
modifies or supersedes such statement. Any statement modified or superseded
shall not be deemed, except as so modified or superseded, to constitute part of
this Prospectus.
The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom a copy of the Prospectus has been
delivered, on the written or oral request of any such person, a copy of any or
all of the documents referred to above which have been or may be incorporated by
reference in this Prospectus, other than exhibits to such documents. Written
requests for such copies should be directed to Corporate Secretary, DCC Compact
Classics, Inc., 9301 Jordan Avenue, Suite 105, Chatsworth, California 91311,
Telephone (818) 993-8822.
3
THE COMPANY
DCC Compact Classics, Inc. (the "Company") was incorporated as a Colorado
corporation on February 20, 1986, and on October 19, 1987, completed the
acquisition of Dunhill Compact Classics, Inc., a privately-held California
corporation. The focus of the Company's operations following such acquisition
was to establish a specialized niche in the then-emerging market for compact
discs ("CDs"). The emergence of compact disc technology in the early 1980's led
to segments of the consuming public replacing their collections of vinyl and
audio cassettes with the superior quality and convenience of compact discs.
Classical music listeners were the first segment to accept compact disc
technology and the initial discs made available were comprised of classical
albums. Since that time there has been substantial acceptance of compact discs
for all types of music, including classical, jazz, rock and oldies. Sales of
compact discs are growing rapidly and by the end of 1994 represented in excess
of 70% of all music sales in the $12 billion record industry.
A predominant portion of the Company's manufacturing process utilizes a
coating of 24K gold and a proprietary vintage vacuum tube system which are
considered by various audiophiles to have a superior phonic quality compared
with standard CDs, and thereby can be sold at a premium in excess of the
incremental manufacturing costs. The Company is presently one of the industry
leaders in the sale of 24K gold CDs and has license rights to the exclusive
exportation of 24K gold CDs albums by such artists as Frank Sinatra, Ray
Charles, Bob Dylan, The Doors, The Eagles, Paul McCartney, Cream, Miles Davis,
Creedence Clearwater Revival, Joni Mitchell, The Steve Miller Bank and Bob
Seger. The Company has successfully exploited the consumer demand for reissues
and compilations of music originally issued on vinyl and audio cassettes. This
has been achieved through the purchase, exploitation and sale of catalogs of
music masters and by licensing rights from others to music masters for
exploitation. The Company's basic concept has been to provide the listening
public a compact disc line that specializes in contemporary music which includes
jazz, classical and oldies and the 24K gold limited edition series. In addition,
the Company has developed "Collection" series which features the best of a
certain performance era or type of music.
Since formation of the Company in February 1986, the Company has entered
into licensing agreements with major record labels throughout the industry,
including Sony, MCA, Warner, Elektra, Atlantic, Arista, Capitol and Polygram
among others. Typically, licensing agreements range from three to five years in
term with possible renewal options. Royalties are paid to the licensor at
between $.55 to $6.00 per unit sold for the term of the agreement. The licensing
agreements grant the Company the exclusive or non-exclusive right to take master
4
recordings of many top artists for the purpose of enhancing the sound quality
through digital sound recording process and then to market under the Company's
trade label the individual recordings or compilations in the form of a compact
disc. At the present time, most of the major music recording companies are not
seeking to develop this specialized niche on a proprietary basis and rely on
specialty operations such as the Company for the development of the reissue
market. The Company follows the normal practice for independent record labels,
which entails subcontracting manufacturing, field sales, physical distribution,
billing and collections to specialized entities providing the services.
Commencing in 1994, the Company formed a strategic alliance with Romance
Alive Audio, Inc. to enter into the emerging market for audio books with a focus
on romance novels. Romance Alive Audio operates out of the same facilities as
the Company, specializes in publishing romance novels on audio cassettes and
markets such audio cassettes through chain stores, supermarkets and traditional
book outlets. The Company has completed signings with numerous well-known
authors in this field and has the potential to become a recognized publisher of
women's romance novels on audio cassettes in the United States.
The Company's offices are located at 9301 Jordan Avenue, Suite 105,
Chatsworth, California 91311, the telephone number of the Company is (818)
993-8822.
CONSULTING AND STOCK OPTION AGREEMENT WITH GARY GILLMAN
On November 21, 1991, the Company entered into an oral Consulting and
Stock Option Agreement with Gary Gillman (reduced to writing on March 8, 1996)
to which the Company agreed to issue to the Consultant options (the "Options")
to purchase 25,000 Shares in consideration for certain financial, administrative
and accounting services to be provided to the Company on an as-needed basis. Mr.
Gillman has also served as a director of the Company since 1993. The Options are
exercisable at $.10 per share of Common Stock on or prior to November 20, 1996.
At this time the Company is registering 10,000 of the 25,000 shares of Common
Stock underlying the Options issued by the Company to Mr. Gillman.
COMMON STOCK PURCHASE WARRANT WITH MARSHALL BLONSTEIN
On April 15, 1994, the Company issued a Common Stock Purchase Warrant to
Marshall Blonstein, the President and Chief Executive Officer and a director of
the Company, a warrant to purchase up to 225,000 shares of Common Stock,
exercisable at any time on or before April 15, 1999. On May 24, 1995, the board
of directors of the Company modified the exercise price of the Warrants from
$.25 per Share to $.13 per Share. The Company is registering hereby 200,000 of
the 225,000 Shares underlying the Warrants issued by the Company to Mr.
Blonstein.
5
Federal Income Tax Effects
An option or warrant holder does not recognize taxable income on the date
of the grant of the Options or Warrants, which is a non-statutory option and
warrant, but recognizes ordinary income generally at the date of exercise in the
amount of the difference between the Option or Warrant exercise price and the
fair market value of the Common Stock on the date of exercise. However, if the
holder is subject to the restrictions on resale of common stock under Section 16
of the Securities Exchange Act of 1934, such person generally recognizes
ordinary income at the end of the six-month period following the date of
exercise in the amount of the difference between the Option or Warrant exercise
price and the fair market value of the common stock at the end of the six-month
period. Nevertheless, such holder may elect, within 30 days after the date of
exercise, to recognize ordinary income as of the date of exercise. The amount of
ordinary income recognized by the option or warrant holder is deductible by the
Company in the year that income is recognized.
Restrictions Under Securities Laws
The sale of any shares of Common Stock acquired upon the exercise of the
Options and Warrants must be made in compliance with federal and state
securities laws. Officers, directors and 10% or greater stockholders of the
Company, as well as certain other persons or parties who may be deemed to be
"affiliates" of the Company under the Federal Securities Laws, should be aware
that resales by affiliates can only be made pursuant to an effective
Registration Statement, Rule 144 or any other applicable exemption. Officers,
directors and 10% and greater stockholders are also subject to the "short swing"
profit rule of Section 16(b) of the Securities Exchange Act of 1934. Section
16(b) of the Exchange Act generally provides that if an officer, director or 10%
and greater stockholder sold any Common Stock of the Company acquired pursuant
to the exercise of a stock option or warrant, he would generally be required to
pay to the Company any "profits" resulting from the sale of the stock and
receipt of the stock option. Section 16(b) exempts all option exercises from
being treated as purchases and, instead, treats an option grant as a purchase of
the underlying security, which grant/purchase may be matched with any sale of
the underlying security within six months of the date of grant.
SALES BY SELLING SECURITY HOLDER
The following table sets forth the name of the Selling Security Holder,
the amount of shares of Common Stock held directly or indirectly, the maximum
amount of shares of Common Stock to be offered by the Selling Security Holder,
the amount of Common Stock to be owned by the Selling Security Holder following
the sale of such shares of Common Stock and the percentage of shares of Common
Stock to be owned by the Selling Security Holder following completion of such
6
offering (based on 6,696,725 shares of Common Stock of the Company outstanding
at June 17, 1996).
Percentage
Shares to be to be Owned
Name of Selling Number of Shares to Owned After After
Security Holder Shares Owned be Offered Offering Offering
- --------------- ------------ ---------- -------- --------
Gary Gillman 25,000(1) 10,000 15,000 (2)%
Marshall Blonstein 2,936,440(4) 200,000 2,736,440 40.86%
- --------------------
(1) Includes options to purchase 25,000 shares of Common Stock at $.10 per
share.
(2) Less than 1%.
DESCRIPTION OF SECURITIES
Authorized Capital Stock
The Certificate of Incorporation of the Company authorizes the Company to
issue up to 10,000,000 shares of Common Stock, par value $.005 per share, of
which 6,696,725 shares were outstanding at June 17, 1996. No shares of Preferred
Stock are authorized by the Company's Certificate of Incorporation.
Common Stock
The Company's authorized Common Stock consists of 10,000,000 shares par
value $.005 per share, of which 6,696,725 shares were outstanding at June 17,
1996. Each holder of record of Common Stock is entitled to one vote for each
outstanding share of Common Stock owned by him on every matter properly
submitted to such stockholder for his vote. The Restated Certificate of
Incorporation of the Company does not authorize cumulative voting for the
election of directors.
The holders of Common Stock are entitled to such dividends as may be
declared by the Board of Directors out of funds legally available therefor and,
in the event of liquidation, dissolution or winding up of the affairs of the
Company, such holders are entitled to receive ratably the net assets of the
Company available for distribution to holders of Common Stock. No holder of any
shares of Common Stock has any preemptive right to subscribe for any securities
of the Company.
Transfer Agent
The transfer agent for the Common Stock is Corporate Stock Transfer
Company, 370 17th Street, Suite 2350, Denver, Colorado 80202-4614.
7
LEGAL MATTERS
Certain legal matters in connection with the securities being offered
hereby will be passed upon for the Company by Atlas, Pearlman, Trop & Borkson,
P.A., 200 East Las Olas Boulevard, Suite
1900, Fort Lauderdale, Florida 33301.
EXPERTS
On April 22, 1996, Henson & Company, the Company's independent auditors,
chose not to continue as the Company's independent auditor based on its desire
to discontinue providing auditing services to publicly-traded companies. The
Company and Henson & Company did not have any disagreements during the two
fiscal years ending December 31, 1994 or any subsequent interim period with
respect to matters of accounting principles or practices, financial statement
disclosure or auditing scope, or procedure which, if not resolved to Henson &
Company's satisfaction, would have caused it to make reference to the subject
matter of such disagreement in its reports. In connection with the termination
of such relationship, the Company decided to engage Winter, Scheifley &
Associates, P.C., Certified Public Accountants, as the Company's accountants to
audit the Company's financial statements for the fiscal year ending December 31,
1995.
INDEMNIFICATION
Article XII of the Articles of Incorporation of the Company provides as
follows:
"The Corporation shall indemnify any and all of its directors,
officers, employees, authorized agents or former directors or
officers or any person who may have served at its request as a
director or officer of another corporation in which it owns shares of
capital stock or of which it is a creditor, against expenses actually
and necessarily incurred by them to the fullest extent permitted
under Colorado Corporate Code, in connection with the defense of any
action, suit or proceeding in which they or any of them, are made
parties, or a party, by reason of being or having been directors or
officers of the Corporation, or of such other corporation, except in
relation to matters to which any such director or officer or former
director or person shall be adjudged in such action, suit or
proceeding to be liable for gross negligence or willful misconduct in
the performance of duty. Such indemnification shall not be deemed
exclusive of any other rights to which those indemnified may be
entitled, under any By-Law agreement, vote of shareholders or
otherwise.
8
In addition, no officer, director, employee or authorized agent shall
be personally liable for any injury to person or property arising out
of a tort committed by an employee unless such officer or director
was personally involved in the situation giving rise to the
litigation or unless such officer or director committed a criminal
offense. The protection afforded hereby shall not restrict the
Corporation's right to eliminate or limit the personal liability of a
director to the Corporation or to its shareholders for monetary
damages for breach of fiduciary duty as a director, and the personal
liability of directors to the Corporation and to its shareholders for
monetary damages shall be eliminated or limited, to the full extent
permitted by the Colorado Corporation Code, except for monetary
damages for: any breach of the director's duty of loyalty to the
Corporation or to its shareholders; acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation
of law; acts specified in Section 7-5-114 of the Colorado Corporation
Code; or any transaction from which the director derived an improper
personal benefit. Nor shall the liability of a director of the
Corporation be eliminated or limited to the Corporation or to its
shareholders for monetary damages for any act or omission occurring
prior to the effective date of this Article."
9
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
- ------- ---------------------------------------
The documents listed in (a) through (f) below are incorporated by
reference in the Registration Statement. All documents subsequently filed by the
Registrant pursuant to Section 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference in the Registration Statement and to be part
thereof from the date of filing of such documents.
(a) The Registrant's latest annual report filed pursuant to Section
13(a) or 15(d) of the Exchange Act, or, in the case of the Registrant, either
(1) the latest prospectus filed pursuant to Rule 424(b) under the Securities Act
of 1933, as amended (the "Act"), that contains audited financial statements for
the Registrant's latest fiscal year for which such statements have been filed or
(3) the Registrant's effective Registration Statement on Form 10 or 30F filed
under the Exchange Act containing audited financial statements for the
Registrant's latest fiscal year.
(b) The Registrant's Quarterly Report on Form 10-QSB for the quarter
ended March 31, 1995.
(c) The Registrant's Quarterly Report on Form 10-QSB for the quarter
ended June 30, 1995.
(d) The Registrant's Quarterly Report on Form 10-QSB for the quarter
ended September 30, 1995.
(e) The Registrant's Annual Report on Form 10-KSB for the year ended
December 31, 1995.
(f) All other reports filed pursuant to Section 13(a) or 15(d) of
the Exchange Act since the end of the fiscal year covered by the Registrant's
document referred to in (a) above.
(g) The description of the Common Stock of the Company which is
contained in a Registration Statement filed under the Exchange Act, including
any amendment or report filed for the purpose of updating such description.
10
Item 4. Description of Securities
- ------ -------------------------
A description of the Registrant's securities is set forth in the
Prospectus incorporated as a part of this Registration Statement.
Item 5. Interests of Named Experts and Counsel
- ------ --------------------------------------
Not Applicable.
Item 6. Indemnification of Directors and Officers
- ------ -----------------------------------------
Article XII of the Articles of Incorporation of the Company provides as
follows:
"The Corporation shall indemnify any and all of its directors,
officers, employees, authorized agents or former directors or
officers or any person who may have served at its request as a
director or officer of another corporation in which it owns shares of
capital stock or of which it is a creditor, against expenses actually
and necessarily incurred by them to the fullest extent permitted
under Colorado Corporate Code, in connection with the defense of any
action, suit or proceeding in which they or any of them, are made
parties, or a party, by reason of being or having been directors or
officers of the Corporation, or of such other corporation, except in
relation to matters to which any such director or officer or former
director or person shall be adjudged in such action, suit or
proceeding to be liable for gross negligence or willful misconduct in
the performance of duty. Such indemnification shall not be deemed
exclusive of any other rights to which those indemnified may be
entitled, under any By-Law agreement, vote of shareholders or
otherwise.
In addition, no officer, director, employee or authorized agent shall
be personally liable for any injury to person or property arising out
of a tort committed by an employee unless such officer or director
was personally involved in the situation giving rise to the
litigation or unless such officer or director committed a criminal
offense. The protection afforded hereby shall not restrict the
Corporation's right to eliminate or limit the personal liability of a
director to the Corporation or to its shareholders for monetary
damages for breach of fiduciary duty as a director, and the personal
liability of directors to the Corporation and to its shareholders for
monetary damages shall be eliminated or limited, to the full extent
permitted by the Colorado Corporation Code, except for monetary
11
damages for: any breach of the director's duty of loyalty to the
Corporation or to its shareholders; acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation
of law; acts specified in Section 7-5-114 of the Colorado Corporation
Code; or any transaction from which the director derived an improper
personal benefit. Nor shall the liability of a director of the
Corporation be eliminated or limited to the Corporation or to its
shareholders for monetary damages for any act or omission occurring
prior to the effective date of this Article."
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Commission, such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant 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 Registrant 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 Act and
will be governed by the final adjudication of such issue.
Item 7. Exemption from Registration Claimed
- ------ -----------------------------------
Inasmuch as the consultant that received the Incentive Stock of the
Registrant was knowledgeable, sophisticated and had access to comprehensive
information relevant to the Registrant, such transaction was undertaken in
reliance on the exemption from registration provided by Section 4(2) of the Act.
As a condition precedent to such grant, the Consultant was required to express
an investment intent and consent to the imprinting of a restrictive legend on
each stock certificate to be received from the Registrant except upon sale of
the underlying shares of Common Stock pursuant to a registration statement.
12
Item 8. Exhibits
- ------ --------
Exhibit Description
- ------- -----------
(4.1) Consulting and Stock Option Agreement with Gary Gillman.
(4.2) Common Stock Purchase Warrant with Marshall Blonstein.
(4.3) Resolution dated May 24, 1995 modifying the exercise price of Common
Stock Purchase Warrants.
(5) Opinion of Atlas, Pearlman, Trop & Borkson, P.A. relating to the
issuance of shares of securities pursuant to the above Option Agreement
(23.1) Consent of Atlas, Pearlman, Trop & Borkson, P.A. included in the
opinion filed as exhibit (5) hereto
(23.2.1) Consent of independent certified public accountants - Henson and
Company for the period ended December 31, 1994.
(23.2.2) Consent of independent certified public accountants - Scheifley &
Associates, P.C.
Item 9. Undertakings
- ------- ------------
(1) The undersigned Registrant hereby undertakes:
(a) To file, during any period in which offerings or sales are being
made, a post-effective amendment to this Registration Statement 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;
(b) That, for the purposes of determining any liability under the
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; and
(c) 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.
(2) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the Registrant'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
13
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.
(3) Insofar as indemnification for liabilities arising under the Act may
be permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Commission, such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant 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 Registrant 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 Act and
will be governed by the final adjudication of such issue.
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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- 8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Chatsworth and the State of California, on the
10th day of July, 1996.
DCC COMPACT CLASSICS, INC.
By: /s/Marshall Blonstein
------------------------------
Marshall Blonstein
President and Principal
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
President, Principal
Executive Officer,
Principal Financial
Officer and Director
and Principal Accounting
/s/ Marshall Blonstein Officer July 10, 1996
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Marshall Blonstein
/s/ Robert Siner Director July 10, 1996
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Robert Siner
/s/ Gary Gillman Director July 10, 1996
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Gary Gillman