<PAGE> 1
As filed with the Securities and Exchange Commission on December 16, 1996
Registration No. 333-_____________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AAVID THERMAL TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 02-0466826
(State or other juris- (I.R.S. Employer
diction of incorporation Identification
or organization) Number)
ONE EAGLE SQUARE
CONCORD, NH 03301
(603) 224-1117
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
AAVID THERMAL TECHNOLOGIES, INC.
1994 STOCK OPTION PLAN
(full title of the plan)
RONALD F. BORELLI
PRESIDENT AND CHIEF EXECUTIVE OFFICER
AAVID THERMAL TECHNOLOGIES, INC.
ONE EAGLE SQUARE
CONCORD, NH 03301
(603) 224-1117
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies of all communications, including all communications sent to
the agent for service, should be sent to:
JOHN W. MITCHELL, ESQ. PAUL JACOBS, ESQ.
VICE PRESIDENT AND GENERAL COUNSEL FULBRIGHT & JAWORSKI L.L.P.
AAVID THERMAL TECHNOLOGIES, INC. 666 FIFTH AVENUE
ONE EAGLE SQUARE NEW YORK, NEW YORK 10103
CONCORD, NH 03301
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
Proposed maximum Proposed maximum Amount of
Title of Securities to be Amount to be offering price per aggregate offering registration fee
registered registered share price
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock $.01 par
value per share........... 328,747 shares $9.8125(1) $3,225,830 $ 978
Common Stock $.01 par
value per share........... 215,017 $4.54 (2) $ 976,178 $ 296
Common Stock $.01 par
value per share........... 97,221 $9.50 (2) $ 923,600 $ 280
Common Stock $.01 par
value per share........... 20,500 $7.38 (2) $ 151,290 $ 46
Common Stock $.01 par
value per share........... 104,186 $9.00 (2) $ 937,674 $ 285
Common Stock $.01 par
value per share........... 28,655 $2.20 (2) $ 63,041 $ 20
======= ========== ======
Total Maximum Offering and
Registration Fees......... 794,326 shares $6,277,613 $1,905
===================================================================================================================================
<FN>
(1) THE PRICE IS ESTIMATED IN ACCORDANCE WITH RULE 457(h)(1) UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, SOLELY FOR THE PURPOSE OF
CALCULATING THE REGISTRATION FEE, BASED ON THE AVERAGE OF THE HIGH AND
LOW PRICES OF THE COMMON STOCK AS REPORTED ON THE NASDAQ NATIONAL
MARKET ON DECEMBER 12, 1996.
(2) REPRESENTS THE PRICE AT WHICH THE INDICATED OPTIONS MAY BE EXERCISED
UNDER THE 1994 STOCK OPTION PLAN.
</TABLE>
<PAGE> 2
PROSPECTUS
794,326 SHARES
AAVID THERMAL TECHNOLOGIES INC.
COMMON STOCK
This Prospectus relates to the offer and sale of up to 794,326 shares
(the "Shares") of Common Stock, par value $.01 per share (the "Common Stock"),
of Aavid Thermal Technologies, Inc. (the "Company"). The Shares are being
offered by certain stockholders of the Company (the "Selling Stockholders") who
purchased such Shares pursuant to the Company's 1994 Stock Option Plan (the
"Plan"). The distribution of the Shares by the Selling Stockholders may be
effected from time to time in one or more transactions for their own accounts
(which may include block transactions) in the over-the-counter market (including
the Nasdaq National Market), or on any exchange on which the Common Stock may
then be listed, in negotiated transactions, through the writing of options on
shares (whether such options are listed on an options exchange or otherwise), or
a combination of such methods of sale, at fixed prices which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Stockholders may
effect such transactions by selling Shares to or through broker-dealers, and
such broker-dealers may receive compensation in the form of discounts,
concessions or commissions from the Selling Stockholders and/or the purchasers
of Shares for whom such broker-dealers may act as agent or to whom they sell as
principal, or both (which compensation as to a particular broker-dealer might be
in excess of customary commissions). The Selling Stockholders may also sell such
Shares pursuant to Rule 144 promulgated under the Securities Act of 1933, as
amended (the "Securities Act"), or may pledge Shares as collateral for margin
accounts and such Shares could be resold pursuant to the terms of such accounts.
The Selling Stockholders and any participating brokers and dealers may be deemed
to be "underwriters" as defined in the Securities Act, and any concessions
received by them and any profit on the resale of the Shares may be deemed to be
underwriting discounts or commissions under the Securities Act. See "Selling
Stockholders" and "Plan of Distribution."
The Common Stock of the Company is traded on the Nasdaq Stock Market's
National Market (the "Nasdaq National Market") under the symbol "AATT." The last
sale price as reported on the Nasdaq National Market for the Common Stock on
December 12, 1996 was $10.00 per share.
None of the proceeds from the sale of the Shares by the Selling
Stockholders will be received by the Company. The Company has agreed to bear all
expenses in connection with the registration of the Shares being offered by the
Selling Stockholders. See "Plan of Distribution."
SEE "RISK FACTORS" COMMENCING ON PAGE 6 FOR A DISCUSSION OF
CERTAIN FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE
COMMON STOCK OFFERED HEREBY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS DECEMBER 16, 1996
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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 periodic reports, proxy statements and other
information with the Securities and Exchange Commission (the "Commission"). Such
reports, proxy statements and other information filed with the Commission may be
inspected and copied at the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549 and at the regional offices of the
Commission located at 500 West Madison Street, Chicago, Illinois 60661, and
Seven World Trade Center, New York, New York 10048. Copies of such material can
be obtained from the Public Reference Section of the Commission at prescribed
rates by writing to the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549. Copies of such information may also be inspected at the reading room of
the National Association of Securities Dealers, Inc., 1735 K Street, N.W.,
Washington, D.C. 20006. The Commission maintains a World Wide Web site on the
Internet at http://www.sec.gov that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the Commission.
This Prospectus constitutes a part of a Registration Statement on Form
S-8 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") filed by the Company with the Commission under the
Securities Act. This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information with respect to the Company and the Common Stock, reference is
hereby made to the Registration Statement. Statements contained herein
concerning the provisions of any document are not necessarily complete, and in
each instance reference is made to the copy of such document filed as an exhibit
to the Registration Statement or otherwise filed with the Commission. Each such
statement is qualified in its entirety by such reference. Copies of the
Registration Statement together with exhibits may be inspected at the offices
of the Commission as indicated above without charge and copies thereof may be
obtained therefrom upon payment of a prescribed fee.
Private Securities Litigation Reform Act Safe Harbor Statement. This
Prospectus (including the documents incorporated by reference herein) contains
certain forward-looking statements (as such term is defined in the Private
Securities Litigation Reform Act of 1995) and information relating to the
Company that are based on the beliefs of the management of the Company, as well
as assumptions made by and information currently available to the management of
the Company. When used in this Prospectus, the words "estimate," "project,"
"believe," "anticipate," "intend," "expect" and similar expressions are intended
to identify forward-looking statements. Such statements reflect the current
views of the Company with respect to future events and are subject to risks and
uncertainties that could cause actual results to differ materially from those
contemplated in such forward-looking statements. For a discussion of such risks,
see "Risk Factors." Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof. The Company
does not undertake any obligation to publicly release any revisions to these
forward-looking statements to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.
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DOCUMENTS INCORPORATED BY REFERENCE
The following documents filed by Aavid Thermal Technologies, Inc. (the
"Company") with the Commission (File No. 0-27308) are incorporated herein by
reference:
(i) The Company's Annual Report on Form 10-K for the year
ended December 31, 1995, as amended.
(ii) The Company's Quarterly Report on Form 10-Q for the
quarter ended March 30, 1996.
(iii) The Company's Quarterly Report on Form 10-Q for the
quarter ended June 29, 1996.
(iv) The Company's Quarterly Report on Form 10-Q for the
quarter ended September 28, 1996.
(v) The Company's Current Report on Form 8-K dated May
16, 1996, as amended.
(vi) The Company's Current Report on Form 8-K dated August
29, 1996.
(vii) The Company's Form 8-A dated January 25, 1996.
In addition to the foregoing, all documents subsequently filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act
subsequent to the date of this Prospectus and prior to the termination of the
offering shall be deemed to be incorporated by reference in the Registration
Statement and to be part hereof from the date of filing of such documents or
Reports. Any statement contained in a document incorporated by reference in the
Registration Statement, unless otherwise indicated therein, speaks as of the
date of the document. Any statement contained in a document incorporated by
reference shall be deemed to be modified or superseded for purposes of the
Registration Statement to the extent that a statement contained herein or in any
subsequently filed document that is also incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of the Registration Statement. The information contained in this Prospectus
relating to the Company should be read together with the information contained
in the documents incorporated herein by reference.
The Company will provide without charge to each person to whom a copy
of this Prospectus is delivered, upon the written or oral request of any such
person, a copy of any or all the documents incorporated herein by reference
(other than exhibits to such documents). Requests for such copies should be
directed to: Aavid Thermal Technologies, Inc., One Eagle Square, Suite 509,
Concord, NH 03301, Attention: Company Secretary, telephone number: (603)
224-1117.
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<PAGE> 5
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information, including "Risk Factors," appearing elsewhere or incorporated by
reference in this Prospectus.
THE COMPANY
Aavid Thermal Technologies, Inc. ("Aavid" or the "Company") is a
leading provider of thermal management products that dissipate unwanted heat in
electronic and electrical components and systems. The Company's thermal
management products, which include aluminum and copper heat sinks, heat sink/fan
combinations, heat pipes, liquid cooled cold plates, attachment accessories,
compliant interface materials and conductive adhesives, operate by conducting,
convecting and radiating away unwanted heat. Substantial engineering is involved
in designing the product to maximize heat dissipation and minimize customers'
assembly costs. The Company believes it has the broadest range of products in
the thermal management industry.
Increases in silicon and system integration, higher processing speeds
and frequencies, smaller form factors, more sophisticated power requirements and
other advances in chip technology are creating increasing heat dissipation
problems in electronic and electrical components and systems. The Company
utilizes a broad array of technologies, design and application engineering
services and software tools to develop product solutions that address customers'
thermal management problems. The Company seeks to work closely with its
customers' engineering personnel to achieve "design-in" of the Company's
products and to focus its research and development efforts.
Aavid's strategy is to expand its technological capabilities,
capitalize on its manufacturing strengths, work closely with its customers and
expand its international presence in order to strengthen its position as a
leading provider of thermal management solutions. Aavid's highly diversified
customer base includes OEMs, distributors and contract manufacturers serving
major industry segments, including the computer, semiconductor,
telecommunications, transportation and power conversion industries. The Company
conducted business in 1995 with over 2,000 customers. The Company's customers
include Allen-Bradley, AT&T, Chrysler, General Electric, Hewlett-Packard, IBM,
Intel, Motorola, Packard Bell and StorageTek.
The Company, through its wholly-owned subsidiary, Fluent Inc.
("Fluent"), is a leading developer and marketer of computational fluid dynamics
("CFD") software which enables sophisticated simulation and analysis of air and
other fluid flows, heat and mass transfer, chemical reaction and related
phenomena. In May 1996, Fluent acquired Fluid Dynamics, Inc. ("FDI"), a leading
computational fluid dynamics company. Fluent's software and problem-solving
support services are used by its customers' advanced product and process
engineering groups for detailed product development, design optimization and
trouble shooting. By providing detailed information and the ability to model
and simulate, Fluent's software can significantly reduce its customers'
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engineering costs and time to market, while improving the final product design.
Fluent's software is used in a broad range of applications, including design of
automobiles, electronic systems, aerospace components and combustion systems, as
well as process plant engineering. Fluent enhances the Company's ability to
develop high-end application engineering solutions and sophisticated design
tools for thermal management customers. The Company intends to leverage Fluent's
international presence to accelerate Aavid's penetration into international
markets.
The Company was incorporated in Delaware in October 1993. Aavid
Engineering, Inc. ("Aavid Engineering"), the Company's predecessor which was
acquired by the Company in October 1993, was incorporated in New Hampshire in
February 1964. As used in this Prospectus, references to "Aavid" and the
"Company" include Aavid Thermal Technologies, Inc. and its subsidiaries,
including Aavid Engineering, Fluent and Fluent's subsidiary FDI. Aavid
Engineering does business under the name "Aavid Thermal Technologies." The
Company's principal executive offices are located at One Eagle Square, Suite
509, Concord, New Hampshire 03301 and its telephone number is (603) 224-1117.
The Aavid World Wide Web address is http://www.aavid.com.
RECENT DEVELOPMENT
Effective October 15, 1996, Ronald F. Borelli, a director of the
Company, became Aavid's President, Chief Executive Officer and Chairman of the
Board of Directors. Mr. Borelli succeeded Alan Beane, who had been Aavid's
President and Chief Executive Officer and a principal stockholder since 1985
and David Steadman, Aavid's Chairman. Messrs. Beane and Steadman will continue
as members of the Board.
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RISK FACTORS
An investment in the shares of Common Stock offered hereby involves a
high degree of risk. Prospective investors should carefully consider the
following risk factors, in addition to other information contained in this
Prospectus, in evaluating an investment in the shares of Common Stock offered
hereby. This Prospectus contains, in addition to historical information,
forward-looking statements that involve risks and uncertainties. The Company's
actual results could differ materially. Factors that could cause or contribute
to such difference include, but are not limited to, those discussed below, as
well as those discussed elsewhere in this Prospectus.
Potential Fluctuations in Operating Results. The Company's quarterly and annual
operating results are affected by a wide variety of factors, many of which are
outside the Company's control, that have in the past and could in the future
materially and adversely affect net sales, gross margins and profitability.
These factors include the volume and timing of orders received, competitive
pricing pressures, availability and cost of raw materials, changes in the mix of
products sold, potential cancellation or rescheduling of orders, changes in the
level of customer inventories of the Company's products, the timing of new
product and manufacturing process technology introductions by the Company or its
competitors, availability of manufacturing capacity and market acceptance of new
or enhanced products introduced by the Company. Additionally, the Company's
growth and results of operations have in the past been, and would in the future
be, adversely affected by downturns in the semiconductor or electronics
industries. The Company is limited in its ability to reduce costs quickly in
response to revenue shortfalls, and this limitation will be exacerbated to the
extent the Company adds additional manufacturing capacity. The need for
continued investment in research and development could also limit the Company's
ability to reduce expenses quickly. As a result of these factors, the Company
expects its operating results to continue to fluctuate. Results of operations in
any one quarter should not be considered indicative of results to be expected
for any future period, and fluctuations in operating results may also cause
fluctuations in the market price for the Common Stock. While the Company targets
certain high growth segments of the thermal management market, the overall
market for thermal management products is growing at a relatively modest rate.
There can be no assurance that the overall thermal management market, the
segments of the market served by the Company or the Company will continue to
grow in the future. Historically, sales have been negatively affected in the
third quarter of each year due to lower customer demand during the summer months
as well as lower production levels due primarily to employee vacations. The
Company anticipates the seasonality of its business will be exacerbated by its
acquisition of Fluent, which historically has had substantially lower revenues
in the second and third calendar quarters than in the first and fourth calendar
quarters due to the summer slowdown in Europe and the budgeting and purchasing
patterns of its customers. See "-Dependence on Emerging Digital Market,"
"-Dependence on Electronics Industry; Cyclicality of Semiconductor Industry,"
"-Risks Associated with Manufacturing Capacity and Fixed Costs" and "-Rapid
Technological Change."
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<PAGE> 8
Dependence on Emerging Digital Market. A significant portion of the recent
growth in the Company's net sales has been, and is expected to continue to be,
dependent upon sales of thermal management products for digital electronics
applications within the Company's markets, consisting primarily of
microprocessors and related chip sets. The Company's sales for digital
electronics applications accounted for approximately 11%, 14%, 18%, 20% and 20%
of net sales in 1992, 1993, 1994, 1995 and the first nine months of 1996,
respectively. The market for thermal management products for commercial digital
electronics applications has only recently emerged and is characterized by more
rapid and uncertain technological change, shorter product lifecycles, greater
pricing pressure and increasing foreign and domestic competition as compared to
the market for power electronics applications. Beginning in the fourth quarter
of 1995 and continuing in the first six months of 1996, the Company has
experienced decreased demand for products for digital electronics applications,
which the Company believes resulted from a downturn in the semiconductor
industry as reflected in decade lows in industry book-to-bill ratios. The
Company has had limited experience in developing thermal management products for
digital electronics applications, and there can be no assurance that the Company
will be able to adapt to the rapidly changing conditions in this market. There
also can be no assurance that the demand for thermal management products for
digital electronics applications within the Company's markets will continue to
grow.
A competitor of the Company has commenced a legal action against the
Company alleging that the Company's method of manufacturing substantially all
the Company's products for digital electronics applications infringes this
competitor's patent. While the Company believes, based on the advice of its
patent counsel, that it has meritorious defenses to this action, there can be no
assurance the Company will prevail. In the event that this competitor were to
prevail, the Company would be materially adversely affected. See "-Pending
Patent Litigation."
Dependence on Electronics Industry; Cyclicality of Semiconductor Industry. The
Company's business is highly dependent on the demand for semiconductor devices
utilized by the electronics industry. The growth of the Company's business will
depend primarily on increased demand for semiconductor devices and products that
require thermal solutions. The semiconductor industry has historically been
cyclical and subject to significant economic downturns characterized by
diminished product demand and eroding average selling prices. A decrease in
demand for semiconductor products would reduce demand for the Company's products
and have an adverse impact on the Company's results of operations. Further,
semiconductor manufacturers and their customers, in developing and designing new
products, typically seek to eliminate or minimize thermal problems, and such
efforts could have the effect of reducing or eliminating demand for certain of
the Company's products. Additionally, the Company believes that many of its OEM
customers compete in intensely competitive markets characterized by declining
prices and low margins. These OEMs pressure their component suppliers, including
the Company, to lower prices regardless of the proprietary content and cost of
the suppliers' products. There can be no assurance
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<PAGE> 9
that demand for semiconductors will increase in the future. The Company
believes, based on publicly available market data, that semiconductor growth in
1996 will be lower than in 1995. There can be no assurance that the Company
will not be adversely affected by cyclical conditions in the semiconductor and
electronics industries. See "-Rapid Technological Change."
Limited Sources of Supply. The Company purchases its raw aluminum logs,
aluminum extrusion and aluminum coil stock and various components from a
limited number of outside sources. The Company purchases substantially all of
its aluminum logs from a single supplier and substantially all of its aluminum
coil from another single supplier.
On September 16, 1996, the Company acquired an aluminum extrusion
business located in Franklin, New Hampshire to minimize the risk of an
interruption in aluminum extrusion supply. The Company expects that the
aluminum extrusion business will supply more than 50% of its raw extrusion
needs. This acquisition, will subject the Company to all of the risks
associated with the ownership and operation of an aluminum extrusion business.
If the available supply of aluminum declines, or if one or more of the current
suppliers is unable for any reason to meet the Company's requirements, is
acquired by a competitor or determines to compete with Aavid, the Company could
experience cost increases, a deterioration of service from its suppliers, or
interruptions, delays or a reduction in raw material supply that may cause the
Company to fail to meet delivery schedules to customers. Although the Company
believes that viable alternate suppliers exist for the aluminum coil stock and
components, any unanticipated interruption of supply would have a short-term
material adverse effect on the Company. Also, because most suppliers of
aluminum extrusion cannot currently meet the product tolerances and design
limits required by the Company, any unanticipated interruption of supply of
aluminum extrusion would have a material adverse effect until the Company could
obtain another supplier which could meet the product tolerances and design
limits required by the Company or the Company itself began to produce aluminum
extrusion or source an alternative materials technology.
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<PAGE> 10
Impact of Changing Aluminum Prices. The Company's results of operations in 1995
and the second half of 1994 were adversely impacted by increases in the price
of aluminum. The principal raw material used in the Company's products is
aluminum, and aluminum represents a significant component of the Company's cost
of goods sold. Market prices for raw aluminum have historically been cyclical
and highly volatile and are influenced by numerous factors beyond the control
of the Company. After remaining generally flat during 1992 and 1993, aluminum
prices in the spot market for ingot increased dramatically in 1994 from
$0.54/lb. on January 3, 1994 to $0.945/lb. on December 30, 1994, peaking at
$1.035/lb. on January 24, 1995 and gradually decreasing to $0.79/lb. at
December 31, 1995. On December 3, 1996, the price for aluminum in the spot
market for ingot was $0.72/lb. The Company's ability to pass price increases
along to its customers is limited by competitive pressures, customer resistance
and price adjustment limitations in the Company's product purchase contracts
with its customers. Even if the Company is able to pass along all or a portion
of raw material price increases, of which there can be no assurance, there is
typically a lag of three to twelve months between the actual cost increase of
raw material and the corresponding increase in the prices of the Company's
products. There can be no assurance that the Company in the future will be able
to recover increased aluminum costs through higher prices to its customers. As
the effective purchase price for the Company's aluminum and other raw materials
changes, competitive conditions will influence the amount of the change, if
any, in the Company's prices to its customers. Fluctuating aluminum prices have
a significant effect on the Company's gross margin and could have a material
adverse effect upon the Company's results of operations and business, as
occurred in 1995 and the second half of 1994. See "-Potential Fluctuations in
Operating Results."
Management of Growth. The Company has recently experienced substantial growth
and has significantly expanded its operations through manufacturing capacity
additions, acquisitions and geographic expansion, including the acquisition of
an extrusion business, Fluent and FDI, and the formation, in August 1996, of a
joint venture in Taiwan with Birchtek Inc., in which the Company owns a 51%
interest, for the development, manufacture and sale of thermal management
products in Taiwan. As part of its strategy, the Company intends to increase its
manufacturing capacity overseas, expand the products and services it offers and
make selective acquisitions. This growth and expansion has placed, and will
continue to place, a significant strain on the Company's management, production,
technical, financial and other resources. To manage growth effectively, the
Company must maintain a high level of manufacturing quality and efficiency, and
must continue to enhance its operational, financial and management systems and
expand, train and manage its employee base. There can be no assurance that the
Company will be able to effectively manage this expansion, and any failure to do
so could have a material adverse effect on the Company's operating results and
financial condition. See "-Risks Associated with Manufacturing Capacity and
Fixed Costs" and "-Dependence on Key Personnel."
The Company is in the process of implementing new and upgraded
operating and financial systems, procedures and controls, including improvements
to its accounting and other internal management systems. There can be no
assurance that such efforts can be accomplished successfully. Moreover, there
can be no assurance that those
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<PAGE> 11
systems, procedures and controls will, when implemented, be adequate to support
the Company's operations. Any failure to expand these areas in a timely manner
could have a material adverse effect on the Company's business, operating
results and financial condition.
In February 1995, the Company installed a newly released software
system designed for "made-to-order manufacturing." Upon installation, the system
was unable to handle Aavid's transaction load, and the Company encountered
numerous "bugs" and deficiencies in the functioning of the software. These
problems resulted in substantial difficulties in managing production and
substantial delays in manufacturing and shipping products, which had a material
adverse effect on the Company's results of operations in the first quarter of
1995 and, to a lesser extent, the second and third quarters of 1995. While the
system is currently operating adequately, there can be no assurance that this
problem will not recur or that other problems will not arise. The Company is
beginning the installation of this system in its other manufacturing facilities,
and there can be no assurance that the Company will not encounter similar
problems at these other facilities.
Risks Associated with Fluent and FDI Acquisitions. In August 1995, the Company
acquired Fluent, which provides computerized design and simulation software used
to predict air and other fluid flows, heat and mass transfer, chemical reaction
and related phenomena. In May 1996, Fluent acquired FDI. The Company has never
managed a software company or engaged in the development of software products
for sale to third parties. The future success of Fluent will depend on the
Company's ability to retain Fluent's management team and continue to attract
qualified software engineers. Although the Company believes Fluent is a leader
in the market for general purpose computational fluid dynamics software tools
used for modeling fluid flow, heat and mass transfer, and chemical reactions,
Fluent has very little presence in Aavid's market, thermal management of
electronics, and there can be no assurance that Fluent can successfully
penetrate this market. Because of the inherent differences between the
businesses of Aavid and Fluent, there can be no assurance that the Company and
its stockholders will ultimately realize any benefit from the acquisition of
Fluent and FDI. See "-Dependence on Key Personnel" and "-Dependence Upon
Intellectual Property."
Risks Associated with Manufacturing Capacity and Fixed Costs. During parts of
1994 and 1995, the Company's manufacturing facilities and workforce operated at
capacity, despite an increase in manufacturing capacity in 1994 and 1995.
Capacity constraints during 1995 were exacerbated by the problems resulting from
the installation of the new software system in February 1995, which adversely
impacted Aavid's production planning and control capability. As a result of
capacity additions which came on line in 1995 and 1996 and the improvement in
the performance of the Company's new software system, the Company is not
currently operating under a physical capacity constraint. Capacity constraints
generally result in longer lead times to customers, thus risking loss of
business to competitors because customers value short lead times. A recurrence
of capacity constraints could adversely affect the Company in the future. The
Company's constantly changing mix of products makes it difficult to manage
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<PAGE> 12
production efficiently. Any failure by the Company to adequately forecast, plan
for or manage efficiently its production could adversely affect the Company's
sales and operating results. The Company's ability to add manufacturing capacity
depends, in part, on the availability of a qualified pool of employees.
The Company has added approximately 168,000 square feet of
manufacturing capacity since January 1, 1994. In addition, the Company intends
to add manufacturing capacity in Canada, Europe and the Far East, initially,
in the case of the Far East, through its Taiwan joint venture. The Company's
recent capacity additions have resulted, and the planned capacity additions
will result, in a significant increase in fixed and operating expenses. If
sales levels do not increase sufficiently to absorb these additional expenses,
or if demand for the Company's products declines, the Company's operating
results would be adversely affected in future periods in light of the fixed
costs needed to own or lease and operate its manufacturing facilities.
A substantial majority of the Company's net sales are generated through
its manufacturing operations in Laconia, New Hampshire. If the Company were
unable to use all or a substantial portion of its Laconia facility for any
reason, the Company's operations would be materially adversely affected until
the Company was able to obtain substitute production capability.
Rapid Technological Change. The markets for the Company's products are
characterized by rapidly changing technology, frequent new product introductions
and enhancements, and rapid product obsolescence. The Company's future success
will be highly dependent upon its ability to continually develop new, and
enhance existing, products, materials, manufacturing processes and services in
order to keep pace with the technological advancements of its customers and
their corresponding increasingly complex thermal management needs. There can be
no assurance that the Company will be able to identify new product trends or
opportunities, develop and bring to market new products, respond effectively to
new technological changes or product announcements by others, develop or obtain
access to advanced materials, or that its products will receive commercial
acceptance. In addition, there can be no assurance that products or technologies
developed by others, including the Company's customers, will not render the
Company's products or technologies noncompetitive or obsolete.
Competition. The markets for thermal management products and CFD software are
highly competitive. Certain of the companies with which the Company competes,
including divisions or subsidiaries of large companies and its customers, have
substantially greater technical, financial, research and development and
marketing resources than the Company. The ability of the Company to compete
successfully depends upon a number of factors, including price, customer
acceptance of the Company's products, cost effective high-volume manufacturing,
proximity to customers, lead times, ease of installation of its products, new
product and manufacturing process technology introductions by the Company and
its competitors, access to new technologies and general market and economic
conditions. Fluent competes primarily on the basis of product performance. There
can be no assurance that the Company will
-11-
<PAGE> 13
be able to compete successfully in the future against existing or potential
competitors or that the Company's operating results will not be adversely
affected by increased price competition. In addition, there can be no assurance
that the Company's customers for thermal management products will not
manufacture such products internally rather than purchase them from the Company.
Future Capital Needs. In order to remain competitive, the Company must continue
to make significant expenditures for expansion of its operations, including
expenditures for capital equipment and new manufacturing facilities in Canada
and overseas, and for research and development. In addition, the Company's
growth since 1993 has required, and any future growth will require, significant
amounts of working capital. The Company believes that the proceeds from its
initial public offering, together with existing cash balances, cash flow from
operations and existing credit facilities, will be adequate to fund its
anticipated capital expenditures and working capital needs through at least
1997. However, after that time, the Company may require additional equity or
debt financing to meet its working capital requirements. There can be no
assurance that additional capital will not be required sooner or, if required,
that it will be available on a timely basis or on terms satisfactory to the
Company. The inability of the Company to obtain adequate additional financing on
reasonable terms when needed would have a material adverse effect on the
Company's business, financial condition and results of operations. If additional
funds are raised through the issuance of equity securities, the percentage
ownership of then current stockholders of the Company would be reduced. Further,
such equity securities may have rights, preferences or privileges senior to
those of the Company's Common Stock. At September 28, 1996, the Company had an
accumulated deficit of $2.625 million.
Dependence Upon Intellectual Property. The Company believes that the success of
its business, particularly the business of its Fluent subsidiary, will depend in
part upon its intellectual property, including patents, copyrights, trade
secrets, know-how and continuing technology innovation. The Company owns patents
and copyrights and seeks patents and copyrights when appropriate on inventions
concerning new products and improvements as part of its ongoing research,
development and manufacturing efforts. There can be no assurance that any steps
taken by the Company to protect its intellectual property will be adequate to
prevent misappropriation, that any patents or copyrights issued to the Company
will not be invalidated, circumvented or challenged or that the rights granted
thereunder will provide a competitive advantage. In addition, the laws of
certain countries in which the Company's products are, or may be, developed,
manufactured or sold, including countries located in Asia, Europe and Latin
America, may not provide the Company's products and intellectual property rights
with the same degree of protection as the laws of the United States.
Furthermore, there can be no assurance that others will not independently
develop technologies that are similar or superior to the Company's technology
and obtain patents or copyrights thereon. In such event, the Company may not be
able to license such technologies on reasonable terms, or at all. Although the
Company believes that its products and technology do not infringe upon
proprietary rights of others, there can be no assurance that third parties will
not assert infringement claims in the future. Moreover, litigation may be
necessary
-12-
<PAGE> 14
in the future to enforce the Company's patents, copyrights and other
intellectual property rights, to protect the Company's trade secrets, to
determine the validity and scope of the proprietary rights of others, or to
defend against claims of infringement or invalidity. Such litigation could
result in substantial costs and diversion of resources and could have a material
adverse effect on the Company's financial condition and results of operations.
Pending Patent Litigation. In August 1992, Thermalloy Inc. ("Thermalloy"), one
of the Company's competitors, commenced a legal action against the Company
alleging infringement of a Thermalloy patent covering a method of manufacturing
heat sinks by gang sawing. Heat sinks made using methods of manufacturing
alleged by Thermalloy to infringe its patent are primarily sold for digital
electronic applications, principally microprocessors and related chipsets, and
constitute substantially all of the Company's digital product line. The Company
filed an answer claiming that (i) its methods of manufacturing pin grid array
heat sinks did not infringe the patent and (ii) the patent is invalid and
unenforceable, among other things, because of the existence of prior art. The
Company filed a counterclaim alleging that Thermalloy violated the United
States antitrust laws by attempting to enforce a patent which it knows to be
invalid. In April 1993, while the case was pending, Thermalloy petitioned the
United States Patent and Trademark Office (the "Patent Office") to reexamine the
claims of the patent in light of certain prior art disclosed to Thermalloy by
Aavid in the litigation. In the reexamination, Thermalloy sought and obtained
new and amended patent claims that attempted to distinguish the published prior
art identified by the Company and presented to the Patent Office by Thermalloy.
The Company believes that the reexamined claims are invalid because the patent
law prohibits the broadening of patent claims on reexamination, and in May 1995
the Company filed a motion for summary judgment on this issue. On March 15,
1996, the United States District Court for the District of New Hampshire granted
the Company's motion for summary judgment and found the patent invalid.
Thermalloy has filed an appeal. While the Company believes, based on the advice
of its patent counsel, that it will prevail on the appeal taken by Thermalloy,
there can be no assurance that the Company will ultimately prevail in this
matter. In the event that Thermalloy were to prevail in such action, Aavid would
be required to cease using the affected technology and/or pay damages and
license fees to Thermalloy, which would have a material adverse effect on the
Company. In the event that Thermalloy were to prevail and Aavid was unable to
obtain a license from Thermalloy or employ a non-infringing method of
manufacturing these products, the Company's ability to compete in the digital
electronics market would be materially adversely affected. Sales of heat sink
products where gang sawing was used to create fins or pins in 1994 and 1995 were
$8.7 million and $18.2 million, respectively. The District Court has also
dismissed the Company's antitrust counterclaim against Thermalloy. See
"-Dependence on Emerging Digital Market."
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<PAGE> 15
Dependence on Key Personnel. The Company believes that its future success will
depend to a significant extent upon its senior management, many of whom would be
difficult to replace. The loss of the services of any key personnel, including
Ronald F. Borelli, the Company's Chairman of the Board, President and Chief
Executive Officer, D. Max Henderson, Aavid Engineering's President and Chief
Operating Officer, and Bharatan R. Patel, Fluent's President and Chief
Executive Officer, could have a material adverse effect upon the Company. The
Company's future success will also depend upon its ability to attract and
retain qualified management, technical and manufacturing employees, including
software engineers, to support its future growth. Competition for such
personnel is intense, and there can be no assurance that the Company will be
successful in attracting or retaining such personnel. The failure to attract
and/or retain such persons could materially adversely affect the Company's
business, results of operations and financial condition. See "-Management of
Growth."
Transaction with Affiliate; Potential Conflict of Interest. Mr. Alan F. Beane,
a director of the Company, is the chairman and, together with one of his
brothers, 90% owner of Materials Innovation, Inc. ("MII"), a company founded
in 1985 and principally engaged in the invention, development and
commercialization of novel coatings and thin films, new engineered materials and
related net shape part manufacturing technologies. The Company and MII are
parties to an agreement pursuant to which the Company licenses certain patents
from MII. In addition, MII has conducted research and development for the
Company in advanced materials and related net shape part manufacturing
technologies. In 1993, 1994, 1995 and the first nine months of 1996, royalty
payments and expense reimbursements by the Company to MII totalled $0, $42,000,
$37,000 and $13,000, respectively, and sales of MII products and development
services to the Company were $270,000, $120,000, $398,000 and $0, respectively.
Under the terms of Mr. Beane's non-competition agreement with the
Company, Mr. Beane is prohibited from competing against the Company. The
relationship of MII to the Company is regulated by the terms of an agreement
between MII, its principals and Aavid, which prohibits MII from competing with
the Company in the markets for heat sinks and other products whose principal
purpose is to dissipate heat from electronic devices. MII is pursuing the
development of certain products and advanced materials which, if
successfully developed, would have
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<PAGE> 16
application to the Company's business. However, MII is not obligated to license
such technology to Aavid, and there can be no assurance that Aavid will benefit
from the relationship with MII or will be able to license any intellectual
property from MII, if desirable, on acceptable terms or at all. There can be no
assurance that a conflict of interest will not develop between Aavid and MII or
that Mr. Beane's association with MII will not materially interfere with his
responsibilities to the Company.
Foreign Operations. The Company believes that it will need to acquire additional
manufacturing facilities overseas to adequately service its customers, many of
which have moved manufacturing operations and expanded their business overseas.
This trend may have an adverse impact on the Company's sales of domestically
manufactured products. As a result, a key element of the Company's business
strategy is to expand internationally, particularly in the market for digital
electronics applications. The Company's international sales (excluding Canada
and Mexico) in 1993, 1994, 1995 and the first nine months of 1996 were $3.3
million, $7.0 million, $14.9 million and $14.4 million, respectively, and
Fluent's international sales for its fiscal years ended March 31, 1994 and 1995
and for the period from January 1, 1995 to August 24, 1995 (the date of the
acquisition of Fluent) were $4.5 million, $6.3 million and $4.2 million,
respectively. In August 1996, the Company formed a joint venture in Taiwan for
the development, manufacture and sale of thermal management products in Taiwan.
The Company has had only limited experience to date operating outside the United
States. There can be no assurance that the Company's expansion of its foreign
operations will be successful. Foreign operations are subject to a number of
risks, including work stoppages, transportation delays and interruptions,
political instability, foreign currency fluctuations, economic disruptions,
expropriation, nationalization, misappropriation of intellectual property, the
imposition of tariffs and import and export controls, changes in governmental
policies (including U.S. policy toward these countries) and other factors which
could have an adverse effect on the Company's business. In addition, the Company
may be subject to risks associated with the availability of, and time required
for, the transportation of products to and from foreign countries. The
occurrence of any of these factors may delay or prevent the delivery of goods
ordered by customers, and such delay or inability to meet customers'
requirements would have a material adverse effect on the Company's results of
operations and could have an adverse effect on the Company's relationships with
its customers. Furthermore, the occurrence of certain of these factors in
countries in which Aavid owns or operates manufacturing facilities could result
in the impairment or loss of the Company's investment in such countries.
Dependence on Independent Distributors. During 1993, 1994, 1995 and the first
nine months of 1996, sales to independent distributors accounted for
approximately 14%, 13%, 15% and 13% of net sales, respectively. The largest
single distributor accounted for less than 3% of net sales in each of those
periods. Several of these distributors have a limited right to return unsold
products to the Company, and there can be no assurance that such returns will
not have a material adverse effect on the Company. These independent
distributors generally are not subject to any minimum purchase requirements and
can discontinue marketing the Company's products at any time upon
-15-
<PAGE> 17
proper notice. Accordingly, the Company must compete for the focus and sales
efforts of its distributors. There can be no assurance that the Company's
distributors will continue to distribute the Company's products or do so
successfully. Although the Company believes that other channels of distribution
would be available if the Company were to lose the services of one or more of
its independent distributors, there can be no assurance that such loss would not
have an adverse effect on its results of operations.
Environmental Regulations. The Company is subject to a variety of federal, state
and local environmental laws relating to the storage, discharge, handling,
emission, generation, manufacture, use and disposal of chemicals, solid and
hazardous waste and other toxic and hazardous materials used to manufacture the
Company's products. The Company believes that it has been operating its
facilities in substantial compliance in all material respects with existing laws
and regulations. Nevertheless, the failure to comply with current or future
regulations could result in substantial fines being imposed on the Company,
suspension of production, alteration of its manufacturing or cessation of
operations. Such regulations could require the Company to acquire expensive
remediation equipment or to incur substantial expenses to comply with
regulations. The Company cannot predict the nature, scope or effect of
legislation or regulatory requirements that could be imposed or how existing or
future laws or regulations will be administered or interpreted with respect to
products or activities to which they have not previously applied. Compliance
with more stringent laws or regulations, as well as more vigorous enforcement
policies of regulatory agencies, could require substantial expenditures by the
Company and could adversely affect the results of operations of the Company.
Control by Certain Principal Stockholders; Effect of Certain Anti-Takeover
Provisions. The Company's executive officers and directors and their affiliated
entities as a group beneficially own approximately 54% of the outstanding Common
Stock. As a result, Aavid's executive officers and directors as a group will
have a significant influence over, and may in fact control, the outcome of all
matters submitted to a vote of the Company's stockholders, including the
election of directors and significant corporate transactions. The shares
beneficially owned by the Company's executive officers, directors and
affiliates, combined with the ability of the Board of Directors to issue shares
of preferred stock without further vote or action by the stockholders, may have
the effect of delaying, deferring or preventing a change in control of the
Company without further action by the stockholders, which could adversely affect
the market price of the Common Stock. The Company's credit agreement provides
the lender with the right to require the payment of all outstanding loans if a
change in control of the Company occurs. In addition, Section 203 of the
Delaware General Corporation Law, which is applicable to the Company, contains
provisions that restrict certain business combinations with interested
stockholders, which may have the effect of inhibiting a nonnegotiated merger or
other business combination.
Shares Eligible for Future Sale. Sales of substantial amounts of Common Stock in
the public market, or the perception that such sales may occur, could adversely
affect the prevailing market price of the Common Stock and the ability of the
Company to raise
-16-
<PAGE> 18
capital through a public offering of its equity securities. Currently,
approximately 3.5 million shares of Common Stock are eligible for sale in the
public market without registration, subject to certain volume and other
limitations, pursuant to Rule 144 under the Securities Act. Approximately 1.5
million of such shares of Common Stock are eligible for sale in the public
market without limitation pursuant to Rule 144(k) under the Securities Act.
Additional shares, including shares issuable upon exercise of options, will
also become available for sale in the public market from time to time in the
future. Certain of the Company's stockholders have the right to cause the
Company to register their shares under the Securities Act and to include their
shares in any future registration of securities effected by the Company under
the Securities Act. An aggregate of approximately 5.7 million shares of Common
Stock, including approximately 2.0 million shares of Common Stock issuable upon
exercise of outstanding options and warrants, are covered by such registration
rights. If such holders, by exercising their demand registration rights, cause
a large number of shares to be registered and sold in the public market, such
sales may have an adverse effect on the market price of the Common Stock. If
the Company is required to include in a Company-initiated registration shares
held by such holders pursuant to the exercise of their piggyback registration
rights, such sales may have an adverse effect on the Company's ability to
raise needed capital.
-17-
<PAGE> 19
SELLING STOCKHOLDERS
The Company will supplement this Prospectus from time to time to
include certain information concerning the security ownership of the Selling
Stockholders and the position, office or other material relationship which a
Selling Stockholder has had within the past three years with the Company or any
of its predecessors or affiliates.
PLAN OF DISTRIBUTION
The distribution of the Shares by the Selling Stockholders may be
effected from time to time in one or more transactions for their own accounts
(which may include block transactions) in the over-the-counter market
(including the Nasdaq National Market), or on any exchange on which the Common
Stock may then be listed, in negotiated transactions, through the writing of
options on shares (whether such options are listed on an options exchange or
otherwise), or a combination of such methods of sale, at fixed prices which may
be changed, at market prices prevailing at the time of sale, at prices related
to such prevailing market prices or at negotiated prices. The Selling
Stockholders may effect such transactions by selling Shares to or through
broker-dealers, and such broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the Selling Stockholders and/or the
purchasers of Shares for whom such broker-dealers may act as agent or to whom
they sell as principal, or both (which compensation as to a particular
broker-dealer might be in excess of customary commissions). The Selling
Stockholders may also sell such Shares pursuant to Rule 144 promulgated under
the Securities Act, or may pledge Shares as collateral for margin accounts and
such Shares could be resold pursuant to the terms of such accounts. The Selling
Stockholders and any participating brokers and dealers may be deemed to be
"underwriters" as defined in the Securities Act and any commissions received by
them and any profit on the resale of the Shares may be deemed to be
Underwriting discounts or commissions under the Securities Act.
In order to comply with certain state securities laws, if applicable,
the Common Stock will not be sold in a particular state unless such securities
have been registered or qualified for sale in such state or any exemption from
registration or qualification is available and complied with.
The Company has agreed to pay all the costs and expenses of this
offering.
LEGAL MATTERS
The validity of the shares offered hereby have been passed upon for the
Company by Fulbright & Jaworski L.L.P., New York, New York. As of December 13,
1996, partners of Fulbright & Jaworski L.L.P. own an aggregate of 4,000 shares
of the Company's Common Stock.
-18-
<PAGE> 20
EXPERTS
The consolidated balance sheets as of December 31, 1994 and
1995 and the consolidated statements of operations, changes in stockholders'
equity and cash flows of the Company for the period from September 26 to
December 31, 1993 and for the years ended December 31, 1994 and 1995, and the
consolidated statements of operations and changes in stockholders' equity and
cash flows of the Company's predecessor for the nine months ended September 25,
1993, incorporated by reference in this Prospectus, have been incorporated by
reference herein in reliance on the report of Coopers & Lybrand L.L.P.,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
-19-
<PAGE> 21
================================================================================
NO PERSON IS AUTHORIZED IN CONNECTION WITH ANY OFFERING MADE HEREBY TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT 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, ANY SELLING STOCKHOLDER OR ANY
OTHER PERSON. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY ANY SECURITY OTHER THAN THE COMMON STOCK OFFERED
HEREBY, NOR DOES IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY ANY OF THE SECURITIES OFFERED HEREBY TO ANY PERSON IN ANY JURISDICTION IN
WHICH IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION. NEITHER THE DELIVERY
OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES
CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF
ANY DATE SUBSEQUENT TO THE DATE HEREOF.
------------
TABLE OF CONTENTS
PAGE
Available Information................................... 2
Documents Incorporated
by Reference........................................... 3
Prospectus Summary...................................... 4
Risk Factors............................................ 6
Selling Stockholders.................................... 18
Plan of Distribution.................................... 18
Legal Matters .......................................... 18
Experts................................................. 19
================================================================================
================================================================================
794,326 Shares
AAVID THERMAL
TECHNOLOGIES, INC.
Common Stock
----------
PROSPECTUS
----------
December 16, 1996
================================================================================
<PAGE> 22
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by Aavid Thermal Technologies, Inc. (the
"Company") with the Commission (File No. 0-27308) are incorporated herein by
reference:
(i) The Company's Annual Report on Form 10-K for the year
ended December 31, 1995, as amended.
(ii) The Company's Quarterly Report on Form 10-Q for the
quarter ended March 30, 1996.
(iii) The Company's Quarterly Report on Form 10-Q for the
quarter ended June 29, 1996.
(iv) The Company's Quarterly Report on Form 10-Q for the
quarter ended September 28, 1996.
(v) The Company's Current Report on Form 8-K dated May
16, 1996, as amended.
(vi) The Company's Current Report on Form 8-K dated August
29, 1996.
(vii) The Company's Form 8-A dated January 25, 1996.
In addition to the foregoing, all documents subsequently filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended, prior to the filing of a post-effective
amendment indicating that all of the securities offered hereunder have been sold
or deregistering all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be part hereof
from the date of filing of such documents. Any statement contained in a document
incorporated by reference in this Registration Statement shall be deemed to be
modified or superseded for purposes of this Registration Statement to the extent
that a statement contained herein or in any subsequently filed document that is
also incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
II-1
<PAGE> 23
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The legality of the Common Stock offered hereby has been passed on for
the Company by Fulbright & Jaworski L.L.P., 666 Fifth Avenue, New York, New
York 10103. As of December 13, 1996, partners of Fulbright & Jaworski L.L.P.
own an aggregate of 4,000 shares of the Company's Common Stock.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145(c) of the General Corporation Law of the State of Delaware
("GCL") provides that a Delaware corporation may indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the corporation),
by reason of the fact that he is or was a director, officer, employee or agent
of the corporation or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation or enterprise,
against expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding
if he acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no cause to believe his conduct was
unlawful.
Section 145(b) of the GCL provides that a Delaware corporation may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by or in the right of
the corporation to procure a judgment in its favor by reason of the fact that
such person acted in any of the capacities set forth above, against expenses
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted under similar standards, except
that no indemnification may be made in respect of any claim, issue or matter as
to which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the court in which such action or suit was
brought shall determine that despite the adjudication of liability, such person
is fairly and reasonably entitled to be indemnified for such expenses which the
court shall deem proper.
Section 145 of the GCL further provides that to the extent a director
or officer of a corporation has been successful in the defense of any action,
suit or proceeding referred to in subsections (a) and (b) or in the defense of
any claim, issue or matter therein, he shall be indemnified against expenses
actually and reasonably incurred by him in connection therewith; that
indemnification provided for by Section 145 shall not be deemed exclusive of
any other rights to which the indemnified party may be entitled; and that the
corporation may purchase and maintain insurance on behalf of any person who is
or was a director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation or enterprise, against any liability asserted
against him or incurred by him in any such capacity or arising out of his
status as such
II-2
<PAGE> 24
whether or not the corporation would have the power to indemnify him against
such liabilities under such Section 145.
The Company's Certificate of Incorporation and Bylaws provide
that the Company shall indemnify certain persons, including officers, directors,
employees and agents, to the fullest extent permitted by Section 145 of the
General Corporation Law of the State of Delaware. The Company has also entered
into indemnification agreements with its current directors and executive
officers. Reference is made to the Certificate of Incorporation, Bylaws and form
of indemnification agreement filed as Exhibits 3.1, 3.3 and 10.6 to the
Company's Registration Statement (No. 33-99232) on Form S-1, respectively. The
Company's directors and officers are insured against losses arising from any
claim against them as such for wrongful acts or omission, subject to certain
limitations.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
4.1 -- Aavid Thermal Technologies, Inc. 1994 Stock Option
Plan (incorporated herein by reference to Exhibit
10.6 to the Company's Registration Statement (No.
33-99232) on Form S-1).
4.2 -- Form of Option Agreement (incorporated herein by
reference to Exhibit 10.7 to the Company's
Registration Statement (No. 33- 99232) on Form S-1).
5 -- Opinion of Fulbright & Jaworski L.L.P.
23.1 -- Consent of Coopers & Lybrand L.L.P.
23.2 -- Consent of Fulbright & Jaworski L.L.P. (contained in
their opinion constituting Exhibit 5).
24 -- Power of Attorney (included in signature page).
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:
II-3
<PAGE> 25
(i) To include any prospectus required by section 10(a)
(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective dates 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.
Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the
total dollar value of securities offered would not
exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
offering range may be reflected in the form of
prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20 percent
change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee"
table in the effective 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, Form S-8 or Form F-3, and
the information required to be included in a
post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished
to the Commission 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 Section 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.
(h) 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
II-4
<PAGE> 26
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 Securities Act of 1933 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 Securities Act of 1933
and will be governed by the final adjudication of
such issue.
II-5
<PAGE> 27
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 Concord, State of New Hampshire on December 16,
1996.
Aavid Thermal Technologies, Inc.
By: /s/ Ronald F. Borelli
----------------------------------------------------
Ronald F. Borelli, President and Chief Executive
Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Ronald F. Borelli and Mark Brown as his
true and lawful attorneys-in-fact and agents, each acting alone, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments to this
Registration Statement, including post-effective amendments, and to file the
same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority of do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, and hereby ratifies and confirms all that said
attorneys-in-fact and agents, each acting alone, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as
amended, this registration statement has been signed below by the following
persons in the capacities and on the dates indicated.
Signature Title Date
/s/ Ronald F. Borelli Chairman of the Board December 16, 1996
- ------------------------- of Directors, President
Ronald F. Borelli and Chief Executive
Officer (Principal
Executive Officer)
II-6
<PAGE> 28
/s/ Alan F. Beane Director December 16, 1996
- -------------------------
Alan F. Beane
/s/ D. Max Henderson Director December 16, 1996
- -------------------------
D. Max Henderson
/s/ David R.A. Steadman Director December 16, 1996
- -------------------------
David R.A. Steadman
/s/ Edward F. Glassmeyer Director December 16, 1996
- -------------------------
Edward F. Glassmeyer
/s/ M. William Macey, Jr. Director December 16, 1996
- -------------------------
M. William Macey, Jr.
/s/ Douglas L. Newhouse Director December 16, 1996
- -------------------------
Douglas L. Newhouse
/s/ Bharatan R. Patel Director December 16, 1996
- -------------------------
Bharatan R. Patel
/s/ William L. Selden Director December 16, 1996
- -------------------------
William L. Selden
/s/ Mark Brown Vice President, Chief December 16, 1996
- ------------------------- Financial Officer and
Mark Brown Treasurer (Principal
Financial and
Accounting Officer)
II-7
<PAGE> 29
INDEX TO EXHIBITS
Exhibit
No. Description Page No.
4.1 Aavid Thermal Technologies, Inc. 1994 Stock Option Plan
(incorporated herein by reference to Exhibit 10.6 to the
Company's Registration Statement (No. 33-99232) on Form S-1).
4.2 Form of Option Agreement (incorporated herein by reference to
Exhibit 10.7 to the Company's Registration Statement (No. 33-
99232) on Form S-1).
5 Opinion of Fulbright & Jaworski L.L.P.
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Fulbright & Jaworski L.L.P. (contained in their
opinion constituting Exhibit 5).
24 Power of Attorney (included in signature page).
<PAGE> 1
Fulbright & Jaworski L.L.P.
666 Fifth Avenue
New York, New York 10103
December 16, 1996
Aavid Thermal Technologies, Inc.
One Eagle Square
Concord, NH 03301
Dear Sirs:
We refer to the Registration Statement on Form S-8 (the
"Registration Statement") to be filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "Act"), on behalf
of Aavid Thermal Technologies, Inc. (the "Company"), relating to 794,326 shares
of the Company's Common Stock, $.01 par value per share (the "Shares"), to be
issued under the Company's 1994 Stock Option Plan (the "Plan").
As counsel for the Company, we have examined such corporate records,
other documents, and such questions of law as we have considered necessary or
appropriate for the purposes of this opinion and, upon the basis of such
examination, advise you that in our opinion, all necessary corporate proceedings
by the Company have been duly taken to authorize the issuance of the Shares
pursuant to the Plan and that the Shares being registered pursuant to the
Registration Statement, when issued under the Plan in accordance with the terms
of the Plan, will be duly authorized, validly issued, fully paid and
non-assessable.
We hereby consent to the use of this opinion as a part of the
Registration Statement and to the reference to our name under the headings
"Legal Matters" and "Interests of Named Experts and Counsel" set forth in the
Registration Statement. This consent is not to be construed as an admission that
we are a person whose consent is required to be filed with the Registration
Statement under the provisions of the Act.
Very truly yours,
Fulbright & Jaworski L.L.P.
<PAGE> 1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement of
Aavid Thermal Technologies, Inc. on Form S-8 of our report, dated February 23,
1996, on our audits of the consolidated financial statements and financial
statement schedule of Aavid Thermal Technologies, Inc. as of December 31, 1995
and 1994, and for the years ended December 31, 1995 and December 31, 1994, and
the period from September 26, 1993 to December 31, 1993, and the Predecessor
for the nine months ended September 25, 1993, which report is included in the
Aavid Thermal Technologies, Inc. 1995 Annual Report on Form 10-K, as amended.
We also consent to the reference to our firm under the caption "Experts."
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
December 16, 1996
