SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): JANUARY 8, 2001
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C-PHONE CORPORATION
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(Exact name of registrant as specified in its charter)
New York 0-24424 06-1170506
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(State or Other Jurisdiction (Commission) (IRS Employer
of Incorporation) File Number) Identification No.)
6714 Netherlands Drive, Wilmington, North Carolina 28405
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (910) 395-6100
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N/A
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
C-Phone Corporation has entered into a letter of intent dated as of December 29,
2000 (the "Letter of Intent" ), with Motion Media Technology, Inc. ("Motion
Media") for the sale of C-Phone's videoconferencing assets for $1 million.
Motion Media is a subsidiary of Motion Media PLC Group (London Stock Exchange).
The transaction is subject to the execution of definitive documentation which is
expected to contain customary conditions to closing, including the approval of
C-Phone shareholders.
Pursuant to the Letter of Intent, Motion Media purchased some of C-Phone's
component inventory for $150,000 and agreed to pay an additional $150,000 for a
paid up, non-exclusive license ("the License") for a recently developed
POTS-only product design, which has not yet been put into production. If the
transaction with Motion Media closes, such up-front payments will be subtracted
from the $1 million purchase price. On January 8, 2000, C-Phone issued a press
release describing the transaction with Motion Media.
In the same press release, C-Phone announced that it intended to voluntarily
withdraw its appeal of the delisting of its common stock from the Nasdaq
SmallCap Market. After consulting with Nasdaq, C-Phone believes that its common
stock will be delisted from the Nasdaq SmallCap Market later this week, at which
time trading should continue on the OTC Bulletin Board.
If the transaction with Motion Media is approved by C-Phone's shareholders and
closes, C-Phone estimates that the funds remaining for eventual distribution to
shareholders may be as much as $0.05 per share.
There can be no assurance, even if the shareholders of C-Phone approve the sale
of C-Phone's videoconferencing assets to Motion Media for $1 million, that the
transaction with Motion Media will close, or, even if it does close, that there
will be $0.05 per share available for distribution to C-Phone's shareholders.
However, if the C-Phone shareholders fail to approve the transaction, the
License will become exclusive and then, in all likelihood, C-Phone will cease
its remaining operations, in which event it is unlikely that any funds will be
available for distribution to C-Phone's shareholders.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
99.1 Letter of Intent with Motion Media Technology, Inc., dated as of
December 29, 2000
99.2 Press Release, dated January 8, 2001
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
C-PHONE CORPORATION
By: /S/ PAUL H. ALBRITTON
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President and Chief
Executive
Date: January 8, 2001
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