-----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, J6VGWETHhFeRsewfmG9AaHsb3iXHzhJ7rixLrthxPJWlZp00NWdSrD99MDYjM/VJ tuv8OxmOAk78zHwTcBJwBw== 0000950168-96-000494.txt : 19960326 0000950168-96-000494.hdr.sgml : 19960326 ACCESSION NUMBER: 0000950168-96-000494 CONFORMED SUBMISSION TYPE: S-8 POS PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 19960325 EFFECTIVENESS DATE: 19960325 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: GLENAYRE TECHNOLOGIES INC CENTRAL INDEX KEY: 0000808918 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 980085742 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 POS SEC ACT: 1933 Act SEC FILE NUMBER: 033-88818 FILM NUMBER: 96538233 BUSINESS ADDRESS: STREET 1: 5935 CARNEGIE BOULEVARD CITY: CHARLOTTE STATE: NC ZIP: 28209 BUSINESS PHONE: 7045530038 FORMER COMPANY: FORMER CONFORMED NAME: N W GROUP INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: NU WEST GROUP INC DATE OF NAME CHANGE: 19880221 FORMER COMPANY: FORMER CONFORMED NAME: NU WEST GROUP LTD DATE OF NAME CHANGE: 19871126 S-8 POS 1 GLENAYRE S-8 POS As filed with the Securities and Exchange Commission on March 25, 1996 Registration No. 33-88818 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------- POST-EFFECTIVE AMENDMENT NO. 1 ON FORM S-8 TO REGISTRATION STATEMENT ON FORM S-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------- GLENAYRE TECHNOLOGIES, INC. (Exact name of registrant as specified in its charter) DELAWARE 98-0085742 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification Number) 5935 CARNEGIE BOULEVARD, CHARLOTTE, NORTH CAROLINA 28209 (Address of Principal Executive Offices) (Zip Code) WESTERN MULTIPLEX CORPORATION 1981 INCENTIVE STOCK OPTION PLAN WESTERN MULTIPLEX CORPORATION 1991 INCENTIVE STOCK OPTION PLAN WESTERN MULTIPLEX CORPORATION 1992 INCENTIVE STOCK OPTION PLAN WESTERN MULTIPLEX CORPORATION 1993 INCENTIVE STOCK OPTION PLAN (Full title of the Plans) CLARKE H. BAILEY CHAIRMAN OF THE EXECUTIVE COMMITTEE 667 MADISON AVENUE, 25TH FLOOR NEW YORK, NEW YORK 10021-8029 (Name and address of agent for service) (212) 935-5678 (Telephone number, including area code, of agent for service) WITH COPIES TO: A. ZACHARY SMITH III KENNEDY COVINGTON LOBDELL & HICKMAN, L.L.P. NATIONSBANK CORPORATE CENTER, SUITE 4200 100 NORTH TRYON STREET CHARLOTTE, NORTH CAROLINA 28202-4006 ---------------------------- THIS POST-EFFECTIVE AMENDMENT COVERS SHARES OF THE REGISTRANT'S COMMON STOCK ORIGINALLY REGISTERED ON THE REGISTRATION STATEMENT ON FORM S-4 TO WHICH THIS IS AN AMENDMENT. THE REGISTRATION FEES IN RESPECT OF SUCH COMMON STOCK WERE PAID AT THE TIME OF THE ORIGINAL FILING OF THE REGISTRATION STATEMENT ON FORM S-4 RELATING THERETO. ON EACH OF JUNE 19, 1995 AND DECEMBER 29, 1995, THE COMPANY PAID A 3 FOR 2 STOCK SPLIT IN THE FORM OF A 50% STOCK DIVIDEND. PURSUANT TO RULE 416 UNDER THE SECURITIES ACT OF 1933, SUCH ADDITIONAL SHARES ISSUED WITH RESPECT TO THE SHARES REGISTERED UNDER THE REGISTRATION STATEMENT ON FORM S-4 ARE DEEMED TO BE COVERED BY SUCH REGISTRATION STATEMENT. PART I INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS Item 1. Plan Information.* Item 2. Registrant Information and Employee Plan Annual Information.* * The information required by Items 1 and 2 of Part I of Form S-8 is omitted from this registration statement in accordance with the Note to Part 1 of Form S-8. Pursuant to General Instruction C to Form S-8, a reoffer prospectus with respect to 145,680 of the 750,000 shares of Glenayre Common Stock covered by this registration statement (prior to adjustment for the 3 for 2 stock splits paid on June 19, 1995 and December 29, 1995) (327,780 shares following such adjustments) is being filed concurrently with this registration statement. PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference. The following documents heretofore filed by Glenayre Technologies, Inc. (the "Company") with the Securities and Exchange Commission, Commission file number 0-15761, are incorporated herein by reference: (a) The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1994; (b)(i) The Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1995; (ii) The Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1995; (iii) The Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1995; (iv) The Company's Current Report on Form 8-K dated March 7, 1995; (v) The Company's Current Report on Form 8-K dated April 13, 1995; (vi) The Company's Current Report on Form 8-K dated May 9, 1995, as amended by a Form 8-K/A dated July 7, 1995; (vii) The Company's Current Report on Form 8-K dated March 11, 1996. (c) The description of the Company's Common Stock contained in the Company's Registration Statement filed pursuant to Section 12 of the Exchange Act, including any amendment or report filed for the purpose of updating such description. All reports and other documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, after the date hereof and 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 part hereof from the date of filing of such reports and documents. 2 Item 4. Description of Securities. Not applicable. Item 5. Interests of Named Experts and Counsel. Not applicable. Item 6. Indemnification of Directors and Officers. The Delaware General Corporation Law contains provisions prescribing the extent to which directors and officers shall or may be indemnified against liabilities which they may incur in their capacities as such. Under those provisions the availability or requirements of indemnification or reimbursement of expenses is dependent upon numerous factors, including whether the action is brought by the corporation or by outsiders and the extent to which the potential indemnitee is successful in his defense. The Bylaws of the Company provide for indemnification of directors to the fullest extent permitted by law. The statute also permits a corporation to purchase and maintain insurance on behalf of its directors and officers against liabilities which they may incur in their capacities as such, whether or not the corporation would have the power to indemnify them under other provisions of the statute. The Company has purchased insurance to provide for indemnification of directors and officers. Item 7. Exemption from Registration Claimed. Not applicable. Item 8. Exhibits. 5 Opinion of Kennedy Covington Lobdell & Hickman, L.L.P. (previously filed) 23.1 Consent of Deloitte & Touche LLP 23.2 Consent of Shilling & Kenyon, Inc. 23.3 Consent of Ireland San Filippo & Company 23.4 Consent of Grant Thornton 23.5 Consent of Kennedy Covington Lobdell & Hickman, L.L.P. (included in Exhibit 5) 23.6 Acknowledgment Letter of Ernst & Young LLP 99 Reoffer Prospectus Item 9. Undertakings. (a) The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; 3 (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; (iii) 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; provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the registration statement is on Form S-3 or Form S-8, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the Registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, 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. (3) 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. (b) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference 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. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 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 Securities and Exchange 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. 4 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, 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 Post- Effective Amendment No. 1 to the registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Charlotte, State of North Carolina, on the 23rd day of March, 1996. GLENAYRE TECHNOLOGIES, INC. By: /s/ Stanley Ciepcielinski Stanley Ciepcielinski Executive Vice President Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the date indicated.
Signature Title Date * Director and Chairman of the March 23, 1996 Gerald B. Cramer Board * Director, Vice Chairman and March 23, 1996 Clarke H. Bailey Chairman of the Executive Committee * John J. Hurley Director and Vice Chairman March 23, 1996 * Director, President and Chief March 23, 1996 Ramon D. Ardizzone Executive Officer (Principal Executive Officer) * Director March 23, 1996 Barry W. Gray * Director March 23, 1996 Thomas C. Israel * Director March 23, 1996 Edward J. Rosenthal * Director March 23, 1996 Thomas E. Skidmore /s/ Stanley Ciepcielinski Executive Vice President, Chief March 23, 1996 Stanley Ciepcielinski Financial Officer, Secretary and Treasurer (Principal Financial Officer) 5 /s/ Billy C. Layton Vice President, Controller and March 23, 1996 Billy C. Layton Chief Accounting Officer (Prin- cipal Accounting Officer) * By: /s/ Stanley Ciepcielinski Stanley Ciepcielinski, Attorney-in-Fact
6 EXHIBIT INDEX Exhibit Description 5 Opinion of Kennedy Covington Lobdell & Hickman, L.L.P. 23.1 Consent of Deloitte & Touche LLP 23.2 Consent of Shilling & Kenyon 23.3 Consent of Ireland San Filippo & Company 23.4 Consent of Grant Thornton 23.6 Acknowledgment Letter of Ernst & Young LLP 99 Reoffer Prospectus EX-23 2 EXHIBIT 23.1 EXHIBIT 23.1 INDEPENDENT AUDITOR'S CONSENT We consent to the incorporation by reference in this Post-Effective Amendment on Form S-8 to Registration Statement No. 33-88818 of Glenayre Technologies, Inc. on Form S-4 of our reports dated February 3, 1995, appearing and incorporated by reference in the Annual Report on Form 10-K of Glenayre Technologies, Inc. for the year ended December 31, 1994 and to the reference to us under the headings "Experts" in the Reoffer Prospectus, which is part of such Registration Statement. DELOITTE & TOUCHE LLP Charlotte, North Carolina March 25, 1996 EX-23 3 EXHIBIT 23.2 EXHIBIT 23.2 We hereby consent to the use in this Post-Effective Amendment to the Registration Statement of our report, dated August 8, 1994, relating to the financial statements of Western Multiplex Corporation and to the reference of our firm under the caption "Experts" in the Prospectus. SHILLING & KENYON, INC. San Jose, California March 23, 1996 EX-23 4 EXHIBIT 23.3 EXHIBIT 23.3 We hereby consent to the use in this Post-Effective Amendment to the Registration Statement of our report, dated August 8, 1993, relating to the financial statements of Western Multiplex Corporation and to the references of our firm under the caption "Experts" in the Prospectus. IRELAND SAN FILIPPO & COMPANY San Carlos, California March 23, 1996 EX-23 5 EXHIBIT 23.4 EXHIBIT 23.4 CONSENT OF INDEPENDENT CHARTERED ACCOUNTANTS To the Directors of Glenayre Technologies, Inc. We consent to the incorporation by reference in Glenayre Technologies, Inc.'s Post-Effective Amendment to the Registration Statement with respect to the acquisition by Glenayre Technologies, Inc. of Western Multiplex Corporation on Form S-4 of our report dated April 21, 1993 appearing in the Annual Report on Form 10-K of Glenayre Technologies, Inc. for the year ended December 31, 1994. GRANT THORNTON Chartered Accountants Vancouver, Canada March 23, 1996 EX-23 6 EXHIBIT 23.6 EXHIBIT 23.6 March 23, 1996 To the Board of Directors and Stockholders of Glenayre Technologies, Inc. Charlotte, North Carolina We are aware of the incorporation by reference in the Post-Effective Amendment to the Registration Statement (Form S-8, No. 33-88818) of Glenayre Technologies, Inc. for the registration of shares under the Western Multiplex Corporation 1981, 1991, 1992, and 1993 Incentive Stock Option Plans of our reports dated July 21, 1995 and October 19, 1995 relating to the unaudited consolidated interim financial statements of Glenayre Technologies, Inc. that are included in its Forms 10-Q for the quarters ended June 30, 1995 and September 30, 1995. Pursuant to Rule 436(c) of the Securities Act of 1933 our reports are not a part of the registration statement prepared or certified by accountants within the meaning of Section 7 or 11 of the Securities Act of 1933. Very truly yours, Ernst & Young LLP EX-99 7 EXHIBIT 99 EXHIBIT 99 P R O S P E C T U S 157,486 SHARES GLENAYRE TECHNOLOGIES, INC. COMMON STOCK ($.02 PAR VALUE) The Common Stock, $.02 par value, of Glenayre Technologies, Inc. (the "Company") is traded under the symbol of GEMS and transactions in the Common Stock and reported on the NASDAQ National Market System. On March 22, 1996, the last reported sale price of the Company's Common Stock on the National Market System was $32.50. All of the Offered Shares are being offered for the account of certain Selling Shareholders. SEE "INVESTMENT CONSIDERATIONS" FOR INFORMATION THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The Selling Shareholders intend to distribute all of the Offered Shares in one or more transactions effected from time to time in the over-the-counter market at market prices prevailing of the time of sale. All the expenses of this offering are payable by the Company. The date of this Prospectus is March 25, 1996. GLENAYRE TECHNOLOGIES, INC. CROSS REFERENCE SHEET PURSUANT TO RULE 501(B) OF REGULATION S-K SHOWING LOCATION IN THE PROSPECTUS OF INFORMATION REQUIRED BY ITEMS IN PART I OF FORM S-3
FORM S-3 PAGE OR HEADING ITEM NUMBER AND CAPTION IN PROSPECTUS Item 1. Forepart of the Registration Statement and Outside of the Front Cover Page of Prospectus.................................................................Outside Front Cover Page Item 2. Inside Front and Outside Back Cover Pages of Prospectus............................Inside Front Cover Page Item 3. Summary Information, Risk Factors and Ratio of Earnings to Fixed The Company; Investment Charges............................................................................Considerations Item 4 Use of Proceeds....................................................................Use of Proceeds Item 5. Determination of Offering Price....................................................Not Applicable Item 6. Dilution...........................................................................Not Applicable Item 7. Selling SecurityHolders............................................................Selling Shareholders Item 8. Plan of Distribution...............................................................Plan of Distribution Item 9. Description of Securities to be Registered.........................................Not Applicable Item 10. Interests of Named Experts and Counsel.............................................Legal Opinion; Experts Item 11. Material Changes...................................................................Not Applicable Item 12. Incorporation of Certain Information by Reference..................................Incorporation of Certain Documents by Reference Item 13. Disclosure of Commission Position on Indemnification for Securities Act Liabilities....................................................................Not Applicable
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED HEREIN, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL ANY SECURITIES OTHER THAN THE REGISTERED SECURITIES TO WHICH IT RELATES OR AN OFFER TO SELL THE SECURITIES COVERED BY THIS PROSPECTUS IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO WHOM, IT IS UNLAWFUL TO MAKE SUCH OFFER. NEITHER THE DELIVERY HEREOF NOR ANY DISTRIBUTION MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE FACTS SET FORTH HEREIN SINCE THE DATE HEREOF. THE COMPANY IS SUBJECT TO THE INFORMATION REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT"), AND IN ACCORDANCE THEREWITH FILES REPORTS AND OTHER INFORMATION WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION"). REPORTS, PROXIES AND INFORMATION STATEMENTS AND OTHER INFORMATION FILED BY THE COMPANY CAN BE INSPECTED AND COPIED AT THE PUBLIC REFERENCE FACILITIES MAINTAINED BY THE COMMISSION AT: ROOM 1024, JUDICIARY PLAZA, 450 FIFTH STREET, N.W., WASHINGTON, D.C. 20549; ROOM 1204, EVERETT MCKINLEY DIRKSEN BUILDING, 219 SOUTH DEARBORN STREET, CHICAGO, ILLINOIS 60604; FEDERAL BUILDING, 26 FEDERAL PLAZA, NEW YORK, NEW YORK 10007; AND SUITE 1710, 10960 WILSHIRE BOULEVARD, LOS ANGELES, CALIFORNIA 90024. COPIES OF SUCH MATERIAL CAN BE OBTAINED FROM THE PUBLIC REFERENCE SECTION OF THE COMMISSION AT JUDICIARY PLAZA, 450 FIFTH STREET, N.W., WASHINGTON, D.C. 20549 AT PRESCRIBED RATES. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents previously filed with the Commission are incorporated in this Prospectus by reference: 1. The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1994. 2. The Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1995. 3. The Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1995. 4. The Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1995. 5. The Company's Current Report on Form 8-K dated March 7, 1995. 6. The Company's Current Report on Form 8-K dated April 13, 1995. 7. The Company's Current Report on Form 8-K dated May 9, 1995, as amended July 7, 1995. 8. The Company's Current Report on Form 8-K dated March 11, 1996. 9. The description of the Company's Common Stock contained in its Registration Statement filed pursuant to Section 12 of the Exchange Act, including any amendment or report filed for the purpose of updating such description. All reports and other documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, after the date hereof and prior to the termination of the offering shall be deemed to be incorporated by reference herein and to be a part hereof from the date of filing of such reports and documents. The Company hereby undertakes to provide without charge to each person, including any beneficial owner, to whom a Prospectus is delivered, on the written or oral request of such person, a copy of any and all information that has been incorporated by reference in the Prospectus (not including exhibits to the information that is incorporated by reference unless such exhibits are specifically incorporated by reference into the information that the Prospectus incorporates). Written or oral requests for such copies should be directed to: Secretary, Glenayre Technologies, Inc., 5935 Carnegie Boulevard, Charlotte, NC 28209, telephone 704/553-0038. 1 THE COMPANY Glenayre Technologies Inc. ("Glenayre" or the "Company") is a leading world wide supplier of telecommunications equipment and related software used by service providers in the paging and wireless personal communications markets. The Company designs, manufactures, markets and services switches, transmitters, controls and software used in personal communications systems (including paging, voice messaging and message management and mobile data systems) and radio telephone systems. The Company was incorporated under the laws of the State of Delaware on September 21, 1987 and is the successor to a corporation organized on April 7, 1945. The principal executive offices of the Company are located at 5935 Carnegie Boulevard, Charlotte, NC 28209. The Company's telephone number is 704/553-0038. INVESTMENT CONSIDERATIONS In addition to other information in this Prospectus, the following should be considered carefully in evaluating the Company and business before purchasing the Common Stock offered hereby. POTENTIAL MARKET CHANGES RESULTING FROM TECHNOLOGICAL ADVANCES The paging industry and Glenayre's business are subject to competition from alternative forms of data communication. In addition, Glenayre's business is focused entirely upon the wireless telecommunications industry. Future technological advances in the wireless telecommunications industry, including digital-based cellular telephone systems, could result in new products which are competitive with Glenayre's products. There can be no assurance that Glenayre will not be adversely affected in the event of such technological advances. While the introduction of more advanced forms of telecommunication may provide opportunities to Glenayre for the development of new products, these advanced forms of telecommunication may reduce the demand for pagers and thus the type of paging transmission systems and related software designed and sold by Glenayre. In addition, there can be no assurance that Glenayre will be able to develop successfully these new products or to provide additional enhancements to its existing products. VOLATILITY OF STOCK PRICE The market price of Glenayre Common Stock is volatile. The market price of Glenayre Common Stock could be subject to significant fluctuations in response to variations in Glenayre's quarterly operating results and other factors such as announcements of technological developments or new products by Glenayre, developments in Glenayre's relationships with its customers, technological advances by existing and new competitors, general market conditions in the industry and changes in government regulations. In addition, in recent years conditions in the stock market in general and shares of technology companies in particular have experienced significant price and volume fluctuations which have often been unrelated to the operating performance of these specific companies. Such market fluctuations and economic conditions unrelated to Glenayre may adversely affect the market price of Glenayre's Common Stock. LIMITS ON PROTECTION OF PROPRIETARY TECHNOLOGY AND INFRINGEMENT CLAIMS Glenayre owns or licenses numerous patents used in its operations. Glenayre believes that while these patents are useful to Glenayre, they are not critical or valuable on an individual basis. The collective value of the intellectual property of Glenayre is comprised of its patents, blueprints, specifications, technical processes and cumulative employee knowledge. Although Glenayre attempts to protect its proprietary technology through a combination of trade secrets, patent law, nondisclosure agreements and technical measures, such protection may not preclude competitors from developing products with features similar to Glenayre's products. The laws of some foreign countries in which Glenayre sells or may sell its products, including The Republic of Korea, The People's 2 Republic of China, Saudi Arabia, Thailand, Dubai, India and Brazil, do not protect Glenayre's proprietary rights in the products to the same extent as do the laws of the United States. Although Glenayre believes that its products and technology do not infringe on the proprietary rights of others, Glenayre is currently party to certain infringement claims, and there can be no assurance that third parties will not assert additional infringement claims against Glenayre in the future. If such litigation resulted in Glenayre's inability to use technology, Glenayre might be required to expend substantial resources to develop alternative technology or to license the prior technology. There can be no assurance that Glenayre could successfully develop alternative technology or license the prior technology on commercially reasonable terms. Glenayre does not believe, however, that an adverse resolution of the pending claims would have a material adverse effect on Glenayre. POTENTIAL CHANGES IN GOVERNMENT REGULATION Many of Glenayre's products operate on radio frequencies. Radio frequency transmissions and emissions, and certain equipment used in connection therewith, are regulated in the United States, Canada and internationally. Regulatory approvals generally must be obtained by Glenayre in connection with the manufacture and sale of its products, and by Glenayre's customers to operate Glenayre's products. There can be no assurance that appropriate regulatory approvals will continue to be obtained, or that approvals required with respect to products being developed for the personal communications services market will be obtained. The enactment by federal, state, local or international governments of new laws or regulations or a change in the interpretation of existing regulations could affect the market for Glenayre's products. Although recent deregulation of international telecommunications industries along with recent radio frequency spectrum allocations made by the FCC have increased the demand for Glenayre's products by providing users of those products with opportunities to establish new paging and other wireless personal communications services, there can be no assurance that the trend toward deregulation and current regulatory developments favorable to the promotion of new and expanded personal communications services will continue or that other future regulatory changes will have a positive impact on Glenayre. INTERNATIONAL BUSINESS RISKS Approximately 35% of 1995 net sales were generated in markets outside of the United States. International sales are subject to the customary risks associated with international transactions, including political risks, local laws and taxes, the potential imposition of trade or currency exchange restrictions, tariff increases, transportation delays, difficulties or delays in collecting accounts receivable, and, to a lesser extent, exchange rate fluctuations. Although a substantial portion of 1995 international sales of the Company's products and services were negotiated in U.S. dollars, there can be no assurance that the Company will be able to maintain such a high percentage of U.S. dollar denominated international sales. The Company seeks to mitigate its currency exchange fluctuation risk by entering into currency hedging transactions. The Company also acts to mitigate certain risks associated with international transactions through the purchase of political risk insurance and the use of letters of credit. USE OF PROCEEDS The Company will not receive any of the proceeds from the sale of the Offered Shares by the Selling Shareholders. SELLING SHAREHOLDERS The names of the Selling Shareholders, the number of shares of the Company's Common Stock to be sold by each of them in this Offering and the number of such shares and the percentage of outstanding Glenayre Common Stock which will be owned by each of them after completion of this Offering are set forth below: 3
PERCENTAGE SHARES HELD SHARES HELD HELD BEFORE SHARES TO AFTER AFTER NAME OFFERING BE SOLD OFFERING OFFERING1 John Woods......................................... 229,568 2 74,326 155,242 3 Michael Gresham4................................... 114,799 7,775 107,024 3 Frank Hegarty5..................................... 170,000 74,326 95,674 3 Edmund Stamburg.................................... 1,059 1,059 1,059 3
1 Based on 60,688,922 shares of the $.02 par value Common Stock outstanding as of March 23, 1996. 2 Mr. Woods served as director and president of Western Multiplex Corporation prior to its acquisition by the Company on April 25, 1995. Includes 106,381 shares subject to presently exercisable options or options exercisable within 60 days and 42,470 shares held as custodian for his children. 3 Less than 1%. 4 Mr. Gresham served as a director and vice president of Western Multiplex Corporation prior to its acquisition by the Company on April 25, 1995. Includes 70,605 shares subject to presently exercisable options or options exercisable within 60 days. 5 Mr. Hegarty served as a director and chief financial officer of Western Multiplex Corporation prior to its acquisition by the Company on April 25, 1995. PLAN OF DISTRIBUTION The Selling Shareholders or their transferees intend to distribute all of the Offered Shares in one or more transactions, effected from time to time in the over-the-counter market at market prices prevailing at the time of sale. If any Offered Shares are sold through broker-dealers, the Selling Shareholders or their transferees may pay customary brokerage commissions and charges. Any broker-dealer that participates in the distribution of the Offered Shares may be deemed to be an "underwriter" within the meaning of the Securities Act of 1933 and any commissions and discounts received by such broker-dealer and any profit from the resale of the Offered Shares by such broker-dealer might be deemed to be underwriting discounts and commissions under the Securities Act. LEGAL OPINION The legality of the Offered Shares has been passed upon by Kennedy Covington Lobdell & Hickman, L.L.P., 4200 NationsBank Corporate Center, 100 North Tryon Street, Charlotte, NC 28202. EXPERTS The consolidated financial statements and the related financial statement schedule incorporated by reference from the Company's Annual Report on Form 10-K for the year ended December 31, 1994 have been audited by Deloitte & Touche LLP, independent auditors, as stated in their report, which is incorporated herein by reference, and has been so incorporated by reference in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. 4 -----END PRIVACY-ENHANCED MESSAGE-----