SEC File No.: 333-109313
Filed pursuant to Rule 424(b)(3) and 424(c)
PROSPECTUS SUPPLEMENT NO. 1
(To Prospectus dated December 29, 2003)
21ST CENTURY HOLDING COMPANY
816,100 Redeemable Warrants
612,075 Shares of Common Stock
This Prospectus Supplement supplements and amends the Prospectus dated
December 18, 2003 (the "Prospectus") relating to the resales from time to time
by holders (the "Selling Securityholders") of our Warrants ("Warrants") and
Shares ("Shares") of our common stock issuable upon exercise of the Warrants.
This Prospectus Supplement should be read in conjunction with the Prospectus,
which is to be delivered with this Prospectus Supplement.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS SUPPLMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus Supplement is January 17, 2006.
OVERVIEW
The Warrants are listed for trading on the NASDAQ National Market under
the symbol "TCHCW." On January 13, 2006, the closing sales price of the Warrants
on the NASDAQ National Market ("NASDAQ") was $4.366 per Warrant. Each Warrant
entitles the holder to purchase 3/4 of one share of our common stock at an
exercise price of $12.744 per whole share. On January 13, 2006, the closing
sales price of Shares of the Company's common stock on NASDAQ was $18.70 per
share.
SELLING SECURITYHOLDERS
The information in the table appearing under the heading "Selling
Securityholders" adds information with respect to persons not previously listed
in the Prospectus as Selling Securityholders and supersedes information for
persons previously listed as Selling Securityholders in the Prospectus. The
information below presents information as of January 17, 2006 regarding the
Selling Securityholders and the Warrants and the Shares that the Selling
Securityholders may offer and sell from time to time under this Prospectus. The
table is prepared based on information supplied to us by the Selling
Securityholders.
Although we have assumed for purposes of the table below that the Selling
Securityholders will sell all of the Warrants or Shares offered by this
Prospectus, no assurances can be given as to the actual number of Warrants or
Shares that will be resold by the Selling Securityholders or that will be held
by the Selling Securityholders after completion of the resales. In addition, the
Selling Securityholders may have sold, transferred or otherwise disposed of the
Warrants or the Shares in transactions exempt from the registration requirements
of the Securities Act since the date the Selling Securityholders provided the
information regarding their securities holdings. Information concerning the
Selling Securityholders may change from time to time and changed information
will be presented in a supplement to the Prospectus and the Prospectus
Supplement if and when necessary and required.
None of the Selling Securityholders has been within the last three years,
or is currently, affiliated with the Company. Except for Omega Overseas
Partners, Ltd. ("Omega Overseas"), each Selling Security holder purchased its
Warrants together with a 6% subordinated note ("Note") in our July 2003 private
offering of Notes and Warrants. Omega acquired the Warrants and underlying
Shares of common stock that are being registering for resale on the open-market.
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Ownership of Ownership of
Securities Number Securities
Before Offering Offered By After Offering
-------------------- Selling -------------------
Selling Securityholder Number Percent Shareholder
---------------------- ------ -------- ----------- ------- -----
Newport Alternative Income Fund(1) 3,041 * 3,041 0 *
Omicron Master Trust 196,098 2.69% 39,235 156,863 2.16%
Omega Overseas Partners, Ltd. (1) 89,100 1.21% 89,100 0 *
OTAPE Investments LLC (1) 13,078 * 13,078 0 *
SilverCreek II Limited (1) 10,100 * 10,100 0 *
SilverCreek Limited Partnership (1) 17,268 * 17,268 0 *
---------------
* Less than 1%.
(1) Represents shares of the Company's common stock underlying Warrants held
by certain Selling Securityholders and the number of Warrants held by each
Selling Securityholder is as follows: Newport Alternative Income Fund -
4,054 Warrants; Omega Overseas Partners, Ltd. - 118,800 Warrants; OTAPE
Investments LLC -17,437 Warrants; SilverCreek II Limited, 13,466 Warrants
and SilverCreek Limited Partnership - 23,024 Warrants.
The Selling Securityholders listed above have provided us with additional
information regarding the individuals or entities that exercise control over
each Selling Securityholder. The proceeds of any sale of Warrants or Shares
pursuant to the Prospectus and the Prospectus Supplement will be for the benefit
of the individuals that control the selling entity.
The following is a list of the Selling Securityholders and the entities
that may exercise the right to vote or dispose of the shares owned by each
Selling Securityholder:
o Omega Overseas has appointed John Lattanzio as a manager of a portion of
its investment portfolio. Mr. Lattanzio is responsible for exercising voting and
dispositive power of the Warrants and the underlying Shares of the Company's
common stock. Omega Advisors, Inc. ("Omega Advisors") also serves as an
investment advisor to Omega Overseas. Leon Cooperman is the President and
majority shareholder of Omega Advisors; however, Mr. Cooperman and Omega
Advisors disclaim any voting or dispositive power over the Warrants and the
underlying Shares of the Company's common stock because Mr. Lattanzio has been
granted sole voting and dispositive power over the portion of Omega Overseas'
portfolio which includes the Warrants and Shares of the Company's common stock.
Mr. Cooperman is the managing member of Omega Associates, L.L.C., which is the
general partner of Omega Equity Investors, L.P ("Omega Equity") and Omega
Capital Investors, L.P ("Omega Capital") and is deemed to exercise voting and
dispositive control of each of these entities. Omega Equity and Omega Capital
each own 270,600 shares and 50,000 shares of the Company's common stock,
respectively. Mr. Cooperman is the managing member of Omega Associates, L.L.C.,
which is the general partner of these partnerships.
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o Omicron Capital, L.P., a Delaware limited partnership ("Omicron
Capital"), serves as investment manager to Omicron Master Trust, a trust formed
under the laws of Bermuda ("Omicron"); Omicron Capital, Inc., a Delaware
corporation ("OCI"), serves as general partner of Omicron Capital; and
Winchester Global Trust Company Limited ("Winchester") serves as the trustee of
Omicron. By reason of such relationships, Omicron Capital and OCI may be deemed
to share dispositive power over the shares of our common stock owned by Omicron,
and Winchester may be deemed to share voting and dispositive power over the
shares of our common stock owned by Omicron. Omicron Capital, OCI and Winchester
disclaim beneficial ownership of such shares of our common stock. Omicron
Capital has delegated authority from the board of directors of Winchester
regarding the portfolio management decisions with respect to the shares of
common stock owned by Omicron and, as of December 30, 2005, Mr. Olivier H.
Morali and Mr. Bruce T. Bernstein, officers of OCI, have delegated authority
from the board of directors of OCI regarding the portfolio management decisions
with respect to the shares of common stock owned by Omicron. By reason of such
delegated authority, Messrs. Morali and Bernstein may be deemed to share
dispositive power over the shares of our common stock owned by Omicron. Messrs.
Morali and Bernstein disclaim beneficial ownership of such shares of our common
stock and neither of such persons has any legal right to maintain such delegated
authority. No other person has sole or shared voting or dispositive power with
respect to the shares of our common stock being offered by Omicron, as those
terms are used for purposes under Regulation 13D-G of the Securities Exchange
Act of 1934, as amended. Omicron and Winchester are not "affiliates" of one
another, as that term is used for purposes of the Securities Exchange Act of
1934, as amended, or of any other person named in this prospectus as a selling
shareholder. No person or "group" (as that term is used in Section 13(d) of the
Securities Exchange Act of 1934, as amended, or the SEC's Regulation 13D-G)
controls Omicron and Winchester.
o OTAPE Investments, LLC is managed by OTA. Ira M. Leventhal, a U.S.
citizen, who may be deemed to have voting and dispositive power with regard to
the shares beneficially owned by OTAPE Investments, LLC.
o Each of Newport Alternative Income Fund, SilverCreek II Limited and
SilverCreek Limited Partnership is managed by SilverCreek Management, Inc.
Louise Morwick and Bryn Joynt are the managing members of Silver Creek
Management, Inc. and have voting and dispositive power over the shares owned by
each of the entities.
PLAN OF DISTRIBUTION
The Selling Securityholders and any pledgees, donees, transferees or other
successors in interest of the Selling Securityholders (collectively, all shall
be referred to as the "Selling Securityholders") may sell their Warrants and
Shares in various ways and at various prices. Some of the methods by which the
Warrants and the Shares may be sold include:
o ordinary brokerage transactions and transactions in which the broker
solicits purchasers or makes arrangements for other brokers to
participate in soliciting purchasers;
o privately negotiated transactions;
o block trades in which the broker or dealer will attempt to sell the
Warrants or Shares as agent but may position and resell a portion of
the block as principal to facilitate the transaction;
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o purchases by a broker or dealer as principal and resale by that
broker or dealer for the Selling Securityholder's account under this
prospectus on the Nasdaq National Market at prices and on terms
then-prevailing in the market;
o sales under Rule 144, if available, rather than using this
Prospectus;
o a combination of any of these methods of sale; and
o any other legally permitted method.
The applicable sales price may be affected by the type of transaction. In
addition, this Plan of Distribution, is also updated to include, the exercise of
the Warrants by assignees, transferees, purchasers or other successors in
interest to the original Selling Securityholders listed in the Prospectus.
When selling Warrants and/or Shares, the Selling Securityholders intend to
comply with the prospectus delivery requirements under the Securities Act, by
delivering the Prospectus, this Prospectus Supplement and any other supplements
or amendments to these documents to each purchaser. We may file any supplements,
amendments or other necessary documents in compliance with the Securities Act
that may be required if a Selling Securityholder defaults under any customer
agreement with brokers.
Brokers and dealers may receive commissions or discounts from the Selling
Securityholders or, if the broker-dealer acts as agent for the purchaser of the
Warrants or Shares, from that purchaser, in amounts to be negotiated. These
commissions are not expected to exceed those customary in the types of
transactions involved. We cannot estimate at the present time the amount of
commissions or discounts, if any, that will be paid by the Selling
Securityholders in connection with any sales of the Warrants and/or Shares.
The Selling Securityholders and any broker-dealers or agents that
participate with a Selling Securityholders in sales of the Warrants and/or
Shares may, in certain instances, be deemed to be "underwriters" within the
meaning of the Securities Act in connection with these sales. In that event, any
commissions received by the broker-dealers or agents and any profit on the
resale of the Warrants or the Shares purchased by them may be deemed to be
underwriting commissions or discounts under the Securities Act.
Under the securities laws of certain states, the Warrants and Shares may
be sold in those states only through registered or licensed broker-dealers. In
addition, the Warrants and Shares may not be sold unless the Warrants and Shares
have been registered or qualified for sale in the relevant state or unless the
Warrants and Shares qualify for an exemption from registration or qualification.
We have agreed to pay all of our out-of-pocket expenses and our
professional fees and expenses incident to the registration of the resale of the
Warrants and the issuance of the Shares. The Selling Securityholders and other
persons participating in any distribution of the Warrants or Shares offered
under this Prospectus and this Prospectus Supplement are subject to the
applicable requirements of Regulation M promulgated under the Exchange Act in
connection with sales of the Warrants and the Shares.
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