-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CqIwe4Oltp68Ix+Z5mvDfhK3QdZtuP9nmfgXywCCQLNxTKz+ixTgT6LPnm35k8/t ikF4TECosMij5eZ+pQ980w== 0000902664-08-001662.txt : 20080327 0000902664-08-001662.hdr.sgml : 20080327 20080327101508 ACCESSION NUMBER: 0000902664-08-001662 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20080327 DATE AS OF CHANGE: 20080327 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CAPTARIS INC CENTRAL INDEX KEY: 0000931784 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 911190085 STATE OF INCORPORATION: WA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-43497 FILM NUMBER: 08713753 BUSINESS ADDRESS: STREET 1: 10885 NE 4TH ST. #400 CITY: BELLEVUE STATE: WA ZIP: 98004 BUSINESS PHONE: 4254556000 MAIL ADDRESS: STREET 1: 10885 NE 4TH ST. #400 CITY: BELLEVUE STATE: WA ZIP: 98004 FORMER COMPANY: FORMER CONFORMED NAME: AVT CORP DATE OF NAME CHANGE: 19980811 FORMER COMPANY: FORMER CONFORMED NAME: APPLIED VOICE TECHNOLOGY INC /WA/ DATE OF NAME CHANGE: 19941021 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Emancipation Capital CENTRAL INDEX KEY: 0001292832 IRS NUMBER: 020700892 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 153 E. 53RD STREET STREET 2: 26TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 212-521-5033 MAIL ADDRESS: STREET 1: 153 E. 53RD STREET STREET 2: 26TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D/A 1 p08-0810sc13da.txt CAPTARIS, INC. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------- SCHEDULE 13D* (Rule 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) Under the Securities Exchange Act of 1934 (Amendment No. 2) Captaris, Inc. - -------------------------------------------------------------------------------- (Name of Issuer) Common Stock, par value $0.01 per share - -------------------------------------------------------------------------------- (Title of Class of Securities) 14071N104 - -------------------------------------------------------------------------------- (CUSIP Number) Mr. Charles Frumberg Emancipation Capital 1120 Avenue of the Americas, Suite 1504 New York, NY 10036 (212) 626-2641 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) March 26, 2008 - -------------------------------------------------------------------------------- (Date of Event which Requires Filing of This Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box. [ ] NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent. (Continued on following pages) - ---------------- * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). CUSIP No. 1407N104 13D/A Page 2 of 9 Pages - ----------------------------------------------------------------------------- (1) NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY) Emancipation Capital, LP - ----------------------------------------------------------------------------- (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP * (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- (3) SEC USE ONLY - ----------------------------------------------------------------------------- (4) SOURCE OF FUNDS* OO - ----------------------------------------------------------------------------- (5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- (6) CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - ----------------------------------------------------------------------------- NUMBER OF (7) SOLE VOTING POWER -0- SHARES -------------------------------------------------------------- BENEFICIALLY (8) SHARED VOTING POWER 1,752,541 OWNED BY -------------------------------------------------------------- EACH (9) SOLE DISPOSITIVE POWER -0- REPORTING -------------------------------------------------------------- PERSON WITH (10) SHARED DISPOSITIVE POWER 1,752,541 - ----------------------------------------------------------------------------- (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,752,541 - ----------------------------------------------------------------------------- (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES * [ ] - ----------------------------------------------------------------------------- (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.65% - ----------------------------------------------------------------------------- (14) TYPE OF REPORTING PERSON * PN - ----------------------------------------------------------------------------- * SEE INSTRUCTIONS BEFORE FILLING OUT! CUSIP No. 1407N104 13D/A Page 3 of 9 Pages - ----------------------------------------------------------------------------- (1) NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY) Emancipation Capital, LLC - ----------------------------------------------------------------------------- (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP * (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- (3) SEC USE ONLY - ----------------------------------------------------------------------------- (4) SOURCE OF FUNDS* OO - ----------------------------------------------------------------------------- (5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- (6) CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - ----------------------------------------------------------------------------- NUMBER OF (7) SOLE VOTING POWER -0- SHARES -------------------------------------------------------------- BENEFICIALLY (8) SHARED VOTING POWER 1,752,541 OWNED BY -------------------------------------------------------------- EACH (9) SOLE DISPOSITIVE POWER -0- REPORTING -------------------------------------------------------------- PERSON WITH (10) SHARED DISPOSITIVE POWER 1,752,541 - ----------------------------------------------------------------------------- (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,752,541 - ----------------------------------------------------------------------------- (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES * [ ] - ----------------------------------------------------------------------------- (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.65% - ----------------------------------------------------------------------------- (14) TYPE OF REPORTING PERSON * OO - ----------------------------------------------------------------------------- * SEE INSTRUCTIONS BEFORE FILLING OUT! CUSIP No. 1407N104 13D/A Page 4 of 9 Pages - ----------------------------------------------------------------------------- (1) NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY) Emancipation Capital Master, Ltd. - ----------------------------------------------------------------------------- (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP * (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- (3) SEC USE ONLY - ----------------------------------------------------------------------------- (4) SOURCE OF FUNDS* OO - ----------------------------------------------------------------------------- (5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- (6) CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - ----------------------------------------------------------------------------- NUMBER OF (7) SOLE VOTING POWER -0- SHARES -------------------------------------------------------------- BENEFICIALLY (8) SHARED VOTING POWER 1,752,541 OWNED BY -------------------------------------------------------------- EACH (9) SOLE DISPOSITIVE POWER -0- REPORTING -------------------------------------------------------------- PERSON WITH (10) SHARED DISPOSITIVE POWER 1,752,541 - ----------------------------------------------------------------------------- (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,752,541 - ----------------------------------------------------------------------------- (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES * [ ] - ----------------------------------------------------------------------------- (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.65% - ----------------------------------------------------------------------------- (14) TYPE OF REPORTING PERSON * CO - ----------------------------------------------------------------------------- * SEE INSTRUCTIONS BEFORE FILLING OUT! CUSIP No. 1407N104 13D/A Page 5 of 9 Pages - ---------------------------------------------------------------------------- (1) NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY) Charles Frumberg - ----------------------------------------------------------------------------- (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP * (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- (3) SEC USE ONLY - ----------------------------------------------------------------------------- (4) SOURCE OF FUNDS* OO - ----------------------------------------------------------------------------- (5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- (6) CITIZENSHIP OR PLACE OF ORGANIZATION United States - ----------------------------------------------------------------------------- NUMBER OF (7) SOLE VOTING POWER -0- SHARES -------------------------------------------------------------- BENEFICIALLY (8) SHARED VOTING POWER 1,752,541 OWNED BY -------------------------------------------------------------- EACH (9) SOLE DISPOSITIVE POWER -0- REPORTING -------------------------------------------------------------- PERSON WITH (10) SHARED DISPOSITIVE POWER 1,752,541 - ----------------------------------------------------------------------------- (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,752,541 - ----------------------------------------------------------------------------- (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES * [ ] - ----------------------------------------------------------------------------- (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.65% - ----------------------------------------------------------------------------- (14) TYPE OF REPORTING PERSON * IN - ----------------------------------------------------------------------------- * SEE INSTRUCTIONS BEFORE FILLING OUT! CUSIP No. 1407N104 13D/A Page 6 of 9 Pages Item 1. Security and Issuer. This Amendment No. 2 ("Amendment No. 2") hereby amends the Schedule 13D filed with the Securities and Exchange Commission (the "SEC") on January 31, 2008, as previously amended (the "Original 13D," and together with Amendment No. 2, the "Schedule 13D") relating to the shares ("Shares") of common stock, $0.01 par value, of Captaris, Inc. (the "Issuer"). Item 3. Source and Amount of Funds or Other Consideration. Item 3 of the Schedule 13D is hereby amended and restated in its entirety as follows: As of March 26, 2008, the aggregate amount of funds used to purchase the Shares held by the Reporting Persons was approximately $7.0 million. The Shares beneficially owned by the Reporting Persons were acquired with investment funds in accounts under management. Item 4. Purpose of Transaction. Item 4 of the Original 13D is amended to include the following: Charles Frumberg, as managing member of Emancipation Capital, sent a letter to the Board of the Issuer dated March 26, 2008, requesting that it expeditiously move forward toward signing up a definitive acquisition agreement with Vector Capital ("Vector") and accept terms that best maximize value for the Issuer's shareholders. The letter indicates that, by entering in to an agreement with Vector, the Issuer's shareholders are assured of a price premium, have a reasonable probability of yet a higher price and have eliminated the risk of a failed auction. In the letter, the Reporting Persons encourage the Issuer to seek a higher price from Vector as a condition of entering in to an agreement, as well as a lengthened go-shop timeline, both of which the Reporting Persons indicate that they believe would further reduce deal risk to the Issuer's shareholders and ultimately serve to maximize shareholder value. The letter indicates that, based on the Reporting Persons' discussions with the Issuer and its bankers, the Reporting Persons understand that there is a belief on the part of the Special Committee of the Issuer that having an agreement with Vector that includes a go-shop provision may dissuade potential strategic acquirers. In the letter, the Reporting Persons disagree with this conclusion and indicate their belief that a go-shop period of not more than 45 to 60 days will allow other potential buyers sufficient time to review and bid for the Issuer. In the letter, the Reporting Persons also indicate that Vector's requested cap on reimbursed expenses of $1 million, or $0.04 per share, is reasonable and limits any extraordinary expenses that another buyer would have to assume, and therefore will not have a chilling effect on other bids. The letter further indicates the Reporting Persons' belief that Vector's shortened due diligence timeline will allow the Issuer's bankers to solicit any other parties with virtually no interruption. In addition, the letter notes that, given the current financing environment, the Reporting Persons believe that it is imprudent to put the Vector proposal on hold until an auction is completed when the same result can be accomplished through a go-shop provision. CUSIP No. 1407N104 13D/A Page 7 of 9 Pages A copy of the letter is filed as Exhibit II to this Amendment No. 2. The Reporting Persons have no present plan or proposal that would relate to or result in any of the matters set forth in subparagraphs (a)-(j) of Item 4 of Schedule 13D except as set forth herein or such as would occur upon completion of any of the actions discussed herein. The Reporting Persons intend to review their investment in the Issuer on a continuing basis. Depending on various factors including, without limitation, the Issuer's financial position and strategic direction, price levels of the Shares, conditions in the securities market and general economic and industry conditions, the Reporting Persons may in the future take such actions with respect to their investment in the Issuer as they deem appropriate including, without limitation, purchasing additional Shares or selling some or all of their Shares, hedging their positions and/or otherwise changing their intentions with respect to any and all matters referred to herein. Item 5. Interest in Securities of the Company. Item 5, sections (a) through (c), of the Schedule 13D are hereby amended and restated in their entirety as follows: (a) As of March 26, 2008, the Reporting Persons beneficially owned, in the aggregate, approximately 6.65% of the Issuer's outstanding Shares. The aggregate percentage of Shares reported to be beneficially owned by the Reporting Persons is based upon 26,645,544 Shares outstanding, which is the total number of Shares outstanding as of February 29, 2008, as reported in the Issuer's Annual Report on Form 10-K for the fiscal year ended December 31, 2007. (b) The Reporting Persons have the following voting and dispositive powers over the Shares reported herein: (i) Emancipation Capital: Beneficial owner, with shared power to vote or direct the vote and to dispose or direct the disposition, of 1,752,541 Shares, or an aggregate of 6.65% of outstanding Shares. (ii) Emancipation Capital LLC: Beneficial owner, with shared power to vote or direct the vote and to dispose or direct the disposition, of 1,752,541 Shares, or an aggregate of 6.65% of outstanding Shares. (iii) Emancipation Master Ltd: Beneficial owner, with shared power to vote or direct the vote and to dispose or direct the disposition, of 1,752,541 Shares, or an aggregate of 6.65% of outstanding Shares. (iv) Mr. Frumberg: Beneficial owner, with shared power to vote or direct the vote and to dispose or direct the disposition, of 1,752,541 Shares and, or an aggregate of 6.65% of outstanding Shares. (c) The following table sets forth all transactions with respect to the Shares effected since the previous filing by any of the Reporting Persons, inclusive of the transactions effected through 4:00 pm, New York City time, on March 26, 2008. All such transactions were effected in the open market. CUSIP No. 1407N104 13D/A Page 8 of 9 Pages - -------------------- ---------- --------- --------- ----------- No. of Price Per Transaction Name Date Shares Share (4) Type - -------------------- ---------- --------- --------- ----------- Emancipation Capital 03/19/2008 25,000 4.23 Purchase Emancipation Capital 03/20/2008 10,000 4.19 Purchase Emancipation Capital 03/20/2008 15,000 4.14 Purchase Emancipation Capital 03/24/2008 5,000 4.14 Purchase Emancipation Capital 03/24/2008 3,000 4.14 Purchase Item 7. Materials to be Filed as Exhibits Exhibit I: Joint Filing Agreement, dated as of January 31, 2008 (previously filed) Exhibit II: Letter to the Issuer dated March 26, 2008 SIGNATURES After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: March 27, 2008 EMANCIPATION CAPITAL, LP By: Emancipation Capital, LLC, its general partner By: /s/ Charles Frumberg -------------------------- Name: Charles Frumberg Title: Managing Member EMANCIPATION CAPITAL MASTER LTD. By: /s/ Charles Frumberg -------------------------- Name: Charles Frumberg Title: Director EMANCIPATION CAPITAL, LLC By: /s/ Charles Frumberg -------------------------- Name: Charles Frumberg Title: Managing Member CHARLES FRUMBERG /s/ Charles Frumberg - ---------------------------------- CUSIP No. 1407N104 13D/A Page 9 of 9 Pages Exhibit Index Exhibit I: Joint Filing Agreement, dated as of January 31, 2008 (previously filed) Exhibit II: Letter to the Issuer dated March 26, 2008 EX-99 2 p08-0810exhibit.txt EXHIBIT II [LOGO] Board of Directors of Captaris c/o Mr. Bruce Crockett 301 116th Ave SE Suite 400 Bellevue, Washington 98004-6446 March 26, 2008 Dear Members of the Board; I am the Managing Member of Emancipation Capital, an investment firm that owns 1,752,541 shares of Captaris, or 6.65%. We are writing this letter to implore you to fully negotiate with Vector Capital and accept terms that we believe best maximize value for us and your other shareholders. According to Vector's most recent filing, they have proposed terms that are generally reasonable to your shareholders and offer downside protection while your bankers are still able to conduct a broad based auction. Based on our previous discussions with you and your bankers, we understand that there is a belief on the Special Committee's part that having an agreement with Vector which includes a go-shop provision may dissuade potential strategic acquirers. We respectfully disagree. We believe that a sufficiently long period will allow any and all potential buyers sufficient time to review and bid for Captaris. It is our position that a 45-60 day period is more than adequate. Vector also filed that they are capping their request for reimbursed expenses at $1 million, or $0.04 per share. This too is reasonable and limits any extraordinary expenses that another buyer would have to assume and thus will not have a chilling effect on other bids. Finally, Vector's shortened due diligence timeline will allow the bankers to solicit any other parties with virtually no interruption. We encourage you to engage Vector immediately in substantive discussions. We would also encourage you to seek a higher price from them as a condition of entering in to an agreement, as well as a lengthened go-shop timeline, both of which would further reduce deal risk to your shareholders and ultimately serve to maximize shareholder value. As you know, we are in a turbulent environment. The probabilities of acquirers finding financing are far worse than at any time in years, which significantly raises the risk of completing a sale. Therefore, it is imprudent to put the Vector proposal on hold until an auction is completed when you can accomplish the same result through a go shop provision. Furthermore, those potential strategic buyers that do not require outside funding are already familiar with Captaris and its market. We believe a two month process is ample to introduce, engage, conduct due diligence, and negotiate a definitive merger agreement with any likely acquirer. By entering in to an agreement with Vector, your shareholders are assured of a price premium, have a reasonable probability of yet a higher price, and have eliminated the risk of a failed auction. Given Vector's apparent willingness to move closer to your position as expressed in their recent filings, it is in the best interests of your shareholders that the Company expeditiously move forward toward signing up a definitive acquisition agreement with Vector and we strongly encourage you to do so. Respectfully submitted; /s/ Charles Frumberg Charles Frumberg Managing Member -----END PRIVACY-ENHANCED MESSAGE-----