<PAGE>
As filed with the Securities and Exchange Commission on September 19, 1997
Registration No.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
__________________________________
CHANNELL COMMERCIAL CORPORATION
DELAWARE 95-2453261
(State of Incorporation (I.R.S. Employer
or Organization) Identification Number)
26040 Ynez Road
Temecula, California 92591-9022
(909) 694-9160
(Address of principal executive offices)
CHANNELL COMMERCIAL CORPORATION 1996 INCENTIVE STOCK PLAN
CHANNELL COMMERCIAL CORPORATION 1996 PERFORMANCE-BASED ANNUAL INCENTIVE
COMPENSATION PLAN
(Full title of the plans)
-------------------------
WILLIAM H. CHANNELL, SR.
CHAIRMAN OF THE BOARD
26040 YNEZ ROAD
TEMECULA, CALIFORNIA 92591-9022
(909) 694-9160
(Agent for service)
-------------------------
It is requested that copies of communications be sent to:
EDMUND M. KAUFMAN, ESQ.
IRELL & MANELLA LLP
333 S. HOPE ST., SUITE 3300
LOS ANGELES, CALIFORNIA 90071
(213) 620-1555
-------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
CALCULATION OF REGISTRATION FEE
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Title of Securities Amount to be Proposed Maximum Offering Proposed Maximum Aggregate Amount of
to be registered registered (1) Price Per Share Offering Price(1) Registration Fee
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Common Stock ($.01 par value) 1,000,000 shares (2) $14.00 $14,000,000 $4,243.00
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(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933 based upon the average
of the high and low sale prices of the Common Stock on the Nasdaq National
Market System on September 19, 1997.
(2) Includes 750,000 shares which have been or may be acquired pursuant to the
Channell Commercial Corporation 1996 Incentive Stock Plan and 250,000 shares
which have been or may be acquired pursuant to the Channell Commercial
Corporation 1996 Performance-Based Annual Incentive Compensation Plan.
<PAGE>
EXPLANATORY NOTE
Pursuant to General Instruction E of Form S-8, this Registration Statement
on Form S-8 (the "Registration Statement") registers 750,000 shares of the
Company's common stock, $0.01 par value per share (the "Common Stock") which
have been or may be acquired pursuant to the Channell Commercial Corporation
1996 Incentive Stock Plan (the "Stock Plan"), and contains a reoffer prospectus
reflecting the shares registered hereby.
This Registration Statement (including the reoffer prospectus included
herein) also registers 250,000 shares which have been or may be acquired
pursuant to the Channell Commercial Corporation 1996 Performance-Based Annual
Incentive Compensation Plan (the "Compensation Plan"). The total number of
shares of Company Stock that may be issued under the Compensation Plan in any
fiscal year of the Company, and the number of shares of Common Stock that may be
issued under the Compensation Plan in any fiscal year of the Company to any
single participant, may not exceed five percent (5%) of the number of issued and
outstanding shares of Common Stock at the beginning of the prior fiscal year.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Pursuant to the requirements of the Note to Part I of Form S-8 and
Rule 428(b)(1) of the Rules under the Securities Act of 1933, as amended, the
information required by Part I of Form S-8 is incorporated by reference in the
Reoffer Prospectus which follows. The Reoffer Prospectus, together with the
documents incorporated by reference pursuant to Item 3 of Part II of this
Registration Statement, constitutes the Section 10(a) Prospectus.
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<PAGE>
REOFFER PROSPECTUS
The material which follows, up to but not including the pages beginning
Part II of this Registration Statement, constitutes a prospectus prepared in
accordance with the applicable requirements of Part I of Form S-3 and General
Instruction C to Form S-8, to be used in connection with resales of securities
acquired under the Registrant's 1996 Incentive Stock Plan and the Registrant's
1996 Performance-Based Annual Incentive Compensation Plan.
CHANNELL COMMERCIAL CORPORATION
COMMON STOCK
($.01 PAR VALUE)
1,000,000 SHARES
______________
This Prospectus relates to 1,000,000 shares of common stock, $0.01 par
value per share ("Common Stock"), of Channell Commercial Corporation, a Delaware
corporation (the "Company"), which may be offered from time to time by one or
all of the selling stockholders named herein (the "Selling Stockholders") or,
pursuant to General Instruction C to Form S-8, in a supplement to this
Prospectus. The Company will receive no part of the proceeds of such sales.
The Company has agreed to pay certain costs and expenses incurred in connection
with the registration of the shares of Common Stock offered hereby, except that
the Selling Stockholders shall be responsible for all selling commissions,
transfer taxes and related charges in connection with the offer and sale of such
shares. See "Plan of Distribution."
The Selling Stockholders may sell all or a portion of the shares offered
hereby from time to time on the National Market System of the National
Association of Securities Dealers Automated Quotation System (the "NASDAQ-NMS")
at prevailing prices at the time of such sales, at prices related to such
prevailing prices or at negotiated prices. The Selling Stockholders may effect
such transactions by selling to or through one or more broker-dealers, and such
broker-dealers may receive compensation in the form of underwriting discounts,
concessions or commissions from the Selling Stockholders. The Selling
Stockholders and any broker-dealers that participate in the distribution may be
deemed to be "underwriters" within the meaning of the Securities Act of 1933, as
amended (the "Securities Act"), and any commissions received by such broker-
dealers and any profits realized on the resale of shares by them may be deemed
to be underwriting discounts and commissions under the Securities Act. The
Selling Stockholders may agree to indemnify such broker-dealers against certain
liabilities, including liabilities under the Securities Act. To the extent
required, the specified shares to be sold, the public offering price, the names
of any such broker-dealers, and any applicable commission or discount with
respect to any particular offer will be set forth in a supplement to this
Prospectus. See "Plan of Distribution."
The Common Stock of the Company is traded on the NASDAQ-NMS. On September
17, 1997, the closing sale price of the Company's Common Stock was $14.75 per
share.
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.
FOR INFORMATION CONCERNING CERTAIN FACTORS RELATING TO THIS OFFERING, SEE "RISK
FACTORS."
The date of this Prospectus is September 22, 1997.
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TABLE OF CONTENTS
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PAGE
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AVAILABLE INFORMATION.......................................... iii
DOCUMENTS INCORPORATED BY REFERENCE............................ iv
THE COMPANY.................................................... v
RISK FACTORS................................................... v
USE OF PROCEEDS................................................ x
SELLING STOCKHOLDERS........................................... x
PLAN OF DISTRIBUTION........................................... xii
LEGAL MATTERS.................................................. xii
EXPERTS........................................................ xii
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NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY, THE SELLING STOCKHOLDERS OR ANY UNDERWRITER. NEITHER
THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY
CIRCUMSTANCES CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH
OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER
OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH SOLICITATION.
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 reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information may 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, and at the following Regional
Offices of the Commission: Seven World Trade Center, New York, New York 10048
and Northwestern Atrium Center, 500 W. Madison Street, 14th Floor, Chicago,
Illinois 60661. Copies may be obtained at the prescribed rates from the Public
Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549. The Commission maintains a Web site at
http://www.sec.gov containing reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission, including the Company.
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The Company has filed with the Commission a registration statement on Form
S-8 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act, with respect to the shares of Common Stock
offered hereby. This Prospectus does not contain all of the information set
forth in the Registration Statement and the exhibits thereto, as permitted by
the rules and regulations of the Commission. For further information with
respect to the Company and the shares of Common Stock offered hereby, reference
is hereby made to the Registration Statement, including the exhibits filed or
incorporated as a part thereof. Statements contained herein concerning the
provisions of any document are not necessarily complete and in each instance
reference is made to the copy of the document filed as an exhibit to the
Registration Statement. Each such statement is qualified in its entirety by
reference to the copy of the applicable documents filed with the Commission.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents heretofore filed by the Company under the Exchange
Act with the Commission are incorporated herein by reference: (1) the Company's
Annual Report on Form 10-K for the year ended December 31, 1996; (2) the
Company's Quarterly Report on Form 10-Q for the quarters ended March 31, 1997
and June 30, 1997; and (3) the description of the Company's Common Stock as set
forth in the registration statement filed by the Company on Form 8-A pursuant to
Section 12(g) of the Exchange Act, and any amendments thereto filed with the
Commission for the purpose of updating such description.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the Common Stock made hereby shall be deemed to
be incorporated in this Prospectus by reference and to be a part hereof from the
date of filing of such documents, except as to any portion of any future Annual
or Quarterly Report to the Company's stockholders that is not deemed to be filed
under said provisions. Any statement incorporated herein shall be deemed to be
modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any other subsequently filed document that also
is or is deemed to be incorporated by reference herein modifies or supersedes
such statement. Any such statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Prospectus.
The Company will provide, without charge, to each person to whom a copy of
this Prospectus has been delivered, on the request of such person, a copy of any
and all of the information that has been or may be incorporated by reference in
this Prospectus, other than exhibits thereto. Written or oral requests for such
copies should be directed to Channell Commercial Corporation at 26040 Ynez Road,
Temecula, California 92591-9022, Attention: Chief Financial Officer. The
telephone number is (909) 694-9160.
-iv-
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THE COMPANY
The Company is a leading designer, manufacturer and marketer of precision-
molded thermoplastic enclosures used by cable television ("CATV") operators and
local telephone companies worldwide. The Company has a leading share of the
CATV market for enclosures in the United States and Canada (based upon the
portion of enclosure product requirements of major CATV operators sold by the
Company) and markets a wide range of products to local telephone companies.
Channell Commercial Corporation also operates through 3 wholly-owned
domestic and foreign subsidiaries: Channell Commercial Europe Ltd, Channell
Commercial Canada Ltd and Standby Electronics Corp. Except as the context
otherwise requires, references to the "Company" include Channell Commercial
Corporation and its operating subsidiaries. The Company's executive offices are
located at 26040 Ynez Road, Temecula, California 92591-9022. The Company's
telephone number is (909) 694-9160.
The Company was incorporated in April 1996 as the successor to Channell
Commercial Corporation, a California corporation incorporated in 1966.
RISK FACTORS
PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED HEREBY SHOULD CONSIDER
CAREFULLY THE INFORMATION SET FORTH BELOW, AS WELL AS THE OTHER INFORMATION
CONTAINED IN THIS PROSPECTUS, IN DETERMINING WHETHER TO PURCHASE SHARES OF
COMMON STOCK OFFERED HEREBY.
OBSOLESCENCE; UNCERTAINTY OF MARKET ACCEPTANCE OF NEW PRODUCTS
The communications industry is characterized by rapid technological change.
The introduction of products embodying new technologies or the emergence of new
industry standards can render existing products or products under development
obsolete or unmarketable. For example, satellite, wireless and other
communication technologies currently being deployed may represent a threat to
copper, coaxial and fiber optic-based systems by reducing the need for wire-line
networks. To date, however, the Company believes that these technologies have
not had a significant impact on the demand for traditional wire-line network
based services, and management anticipates that a number of factors, including
network capacity requirements, existing investments in wire-line networks,
security and long-term cost effectiveness, will result in continued growth of
wire-line networks. However, there can be no assurance that future advances or
further development of these or other new technologies will not have a material
adverse effect on the Company's business. Further, the Company's growth
strategies are designed, in part, to take advantage of opportunities that the
Company believes are emerging as a result of the development of enhanced voice,
video and other transmission networks and internet access in the CATV and
telecommunications industries. There can be no assurance that demand resulting
from these emerging trends will develop rapidly or that the Company's products
will meet with market acceptance.
IMPORTANCE OF NEW PRODUCT DEVELOPMENT TO GROWTH
The Company's ability to anticipate changes in technology and industry
standards and to successfully develop and introduce new products on a timely
basis will be a significant factor in the Company's ability to grow and remain
competitive. New product development often requires long-term forecasting of
market trends, development and implementation of new designs and processes and a
substantial capital commitment. The trend toward consolidation of the
communications industry may
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require the Company to quickly adapt to rapidly changing market conditions and
customer requirements. Although the Company's manufacturing and marketing
expertise has enabled it to successfully develop and market new products in the
past, any failure by the Company to anticipate or respond in a cost-effective
and timely manner to technological developments or changes in industry standards
or customer requirements, or any significant delays in product development or
introduction, could have a material adverse effect on the Company's business,
operating results and financial condition.
CONCENTRATION OF CUSTOMERS; LIMITED BACKLOG
The Company's core business consists of enclosure product sales to the CATV
market. Such sales comprised approximately 87% of the Company's total net sales
in 1996. The CATV industry is concentrated, with relatively few cable operators
accounting for a large percentage of the Company's available market.
Consequently, while the Company shipped product to over 4,000 customer locations
in 1996, its five largest customers (by sales volume) accounted for 54.6% of the
Company's total net sales in 1996. Two customers, TCI and Time Warner,
accounted for 14.9% and 17.3%, respectively, of the Company's total net sales
during the period.
The Company's customers typically require prompt shipment of the Company's
products. As a result, the Company has historically operated with a relatively
small backlog, and sales and operating results in any quarter are principally
dependent upon orders booked and products shipped in that quarter. Further, the
Company's customers generally do not enter into long-term supply contracts
providing for future purchase commitments for the Company's products. These
factors, when combined with the Company's operating leverage and the need to
incur certain capital expenditures and expenses in part based upon the
expectation of future sales, results in the Company's operating results being at
risk to changing customer buying patterns. If sales levels in a particular
period do not meet the Company's expectations, operating results for that period
may be materially and adversely affected.
The industries in which the Company operates are highly competitive. The
Company believes that many of its customers periodically review their supply
relationships and alter buying patterns based upon their current assessment of
the products and pricing available in the marketplace. This periodic review can
and does result in significant changes from fiscal period to fiscal period in
the level of purchases of the Company's products by specific customers.
DEPENDENCE ON THE COMMUNICATIONS INDUSTRY
The Company's sales to the communications industry represent substantially
all of the Company's historical sales and are expected to continue to do so for
the foreseeable future. Within that industry, 88% of the Company's total net
sales in 1996 were derived from domestic and international sales to the CATV
segment, with 32.2% of total net sales for that year attributable to two
customers in that industry, TCI and Time Warner. The Company expects that sales
to the CATV industry will continue to represent a substantial portion of its
total sales. Demand for products to this segment depends primarily on capital
spending by cable operators for constructing, rebuilding, maintaining or
upgrading their systems. The amount of capital spending and, therefore, the
Company's sales and profitability are affected by a variety of factors,
including general economic conditions, access by cable operators to financing,
government regulation of cable operators, demand for cable services and
technological developments in the broadband communications industry. The
Company's remaining sales in 1996 were derived from the telecommunications
industry, primarily local telephone operators. Although local telephone
operators may have greater access to capital than many cable operators, the same
factors dictating the demand for products in the CATV segment of the industry
also apply to the local telephone segment. Thus, the Company's success is
dependent upon continued demand for products used in signal transmission systems
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<PAGE>
from the communications industry generally, including both CATV and telephone,
which may be affected by factors beyond the Company's control, including the
convergence of voice, data and video transmission systems occurring within the
CATV and telephone markets, continuing consolidation of companies within those
markets and the provision of internet access by cable operators and local
telephone companies.
PRICE FLUCTUATIONS OF RAW MATERIALS; AVAILABILITY OF COMPLEMENTARY PRODUCTS
The Company's cost of sales may be materially adversely affected by
increases in the market prices of the raw materials used in the Company's
manufacturing processes, including resin. The Company does not engage in
hedging transactions for such materials, although it periodically enters into
contracts for certain raw materials for as much as one year or more. There can
be no assurance that price increases in raw materials can be passed on to the
Company's customers through increases in product prices. In addition, in order
to position itself as a full-line product supplier, the Company relies on
certain manufacturers to supply products that complement the Company's own
product line, including grade level boxes and cable-in-conduit. Although the
Company believes there are multiple sources of supply for these products,
disruptions or delays in the supply of such products could have a material
adverse effect on sales of the Company's own products.
RISKS ASSOCIATED WITH INTERNATIONAL OPERATIONS
International sales accounted for 11.8%, of the Company's net sales in
1996, and the Company expects that international sales may increase as a
percentage of sales in the future. Due to its international sales, the Company
is subject to the risks of conducting business internationally, including
unexpected changes in, or impositions of, legislative or regulatory
requirements, fluctuations in the U.S. dollar which could materially adversely
affect U.S. dollar revenues or operating expenses, tariffs and other barriers
and restrictions, potentially longer payment cycles, greater difficulty in
accounts receivable collection, potentially adverse taxes and the burdens of
complying with a variety of international laws and communications standards.
The Company is also subject to general geopolitical risks, such as political and
economic instability and changes in diplomatic and trade relationships, in
connection with its international operations. There can be no assurance that
these risks of conducting business internationally will not have a material
adverse effect on the Company's business.
COMPETITION
The industries in which the Company operates are highly competitive.
Further, in connection with the anticipated growth in the communications
industry generally and demand for products required in signal transmission
networks in particular, the level and intensity of competition may increase in
the future. In the telephone segment of the Industry, the Company's competition
includes a company that has a significant market share. While the Company's
strategy includes continued focus on increasing sales to this segment, there can
be no assurance that the Company will be able to compete successfully against
that company or other competitors, many of which may have access to greater
financial resources than the Company. See "Concentration of Customers; Limited
Backlog."
DISRUPTIONS AT THE COMPANY'S MANUFACTURING FACILITY; LEASE WITH RELATED PARTY
All of the Company's manufacturing operations are currently located at the
Company's facility in Temecula, California, which also includes the Company's
principal warehouse and corporate offices. The Company's success depends in
large part on the orderly operation of this facility. Because the Company's
manufacturing operations and administrative departments are concentrated at this
facility, a
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fire, earthquake or other disaster at this facility could materially and
adversely affect its business and results of operations. The Company maintains
standard property and earthquake insurance on this facility as well as business
interruption insurance and back-up data systems.
The Company currently leases the Temecula facilities from William H.
Channell, Sr., a principal stockholder and Chairman of the Board and chief
Executive Officer of the Company. Annual rental expense for this property is
expected to be $1,100,000 in 1997. The Company believes the terms of these
leases are no less favorable than would be available from an unrelated third
party after arms' length negotiations. Although the Company has renewal options
through the year 2015 under these leases, there can be no assurance that the
Company and Mr. Channell, Sr. will be able to agree on renewal terms for the
properties currently leased by the Company. The failure of the Company to renew
the leases would require the Company to relocate its existing facilities.
DEPENDENCE ON KEY PERSONNEL
The future success of the Company depends in part on its ability to attract
and retain key executive, engineering, marketing and sales personnel. Key
personnel of the Company include William H. Channell, Sr., the Chairman of the
Board and Chief Executive Officer and William H. Channell, Jr., the President.
Competition for qualified personnel in the communications industry is intense,
and the loss of certain key personnel could have a material adverse effect on
the Company. The Company has entered into employment contracts with Mr.
Channell, Sr. and Mr. Channell, Jr.
CHANGING REGULATORY ENVIRONMENT
The communications industry is subject to regulation in the United States
and other countries. Federal and state regulatory agencies regulate most of the
Company's domestic customers. On February 1, 1996, the United States Congress
passed the Telecommunications Act of 1996 (the "Telecommunications Act"), which
the President signed into law on February 8, 1996. The Telecommunications Act
lifts certain restrictions on the ability of companies, including RBOCs and
other customers of the Company, to compete with one another and generally
reduces the regulation of the communications industry. While the Company
believes that the deregulation of the Communications industry may increase the
Company's opportunities to provide solutions for its customers' signal
transmission network needs, the effect of the Telecommunications Act on the
market for the Company's products is difficult to predict at this time, and
there can be no assurance that competition in the Company's markets will not
intensify as a result of such deregulation. Changes in current or future laws
or regulations, in the United States or elsewhere, could materially adversely
affect the Company's business.
UNCERTAIN ABILITY TO MANAGE GROWTH; RISKS ASSOCIATED WITH IMPLEMENTATION OF NEW
MANAGEMENT INFORMATION SYSTEM
The growth in the Company's business has required, and is expected to
continue to require, significant Company resources in terms of personnel,
management and other infrastructure. The Company's ability to manage any future
growth effectively will require it to attract, train, motivate and manage new
employees successfully, to integrate new employees into its overall operations
and to continue to improve its operational, financial and management information
systems. In particular, in 1996, the Company began an implementation of a new
management information system ("MIS"). The Company believes the new MIS
significantly affects many aspects of its business, including its accounting,
operations, purchasing, sales and marketing functions. The successful
implementation of this system is important to the Company's provision of
services and to facilitate future growth. If the
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Company experiences difficulties in such implementation, the Company could
experience problems with delivery of its products or an adverse impact on its
ability to access financial and accounting information on a timely basis.
ENVIRONMENTAL MATTERS
The Company is subject to a wide variety of federal, state and local
environmental laws and regulations and uses a limited number of chemicals that
are classified as hazardous or similar substances. Although management believes
that the Company's operations are in compliance in all material respects with
current environmental laws and regulations, the Company's failure to comply with
such laws and regulations could have a material adverse effect on the Company.
POSSIBLE VOLATILITY OF STOCK PRICE
The market price of shares of the Company's Common Stock may be highly
volatile. Factors such as announcements of technological innovations or new
products by the Company or its competitors, developments in patent or other
proprietary rights by the Company or its competitors, litigation, fluctuations
in the Company's operating results, market conditions for emerging growth stocks
or communications industry stocks in general, regulatory developments affecting
the communications industry, and other factors outside the control of the
Company, could have a significant impact on the future price of the Common
Stock.
EFFECT ON STOCK PRICE OF CERTAIN ANTI-TAKEOVER PROVISIONS
Certain provisions of the Company's Restated Certificate of Incorporation
and Bylaws and of Delaware law could have the effect of making it more difficult
for a third party to acquire, or of discouraging a third party from attempting
to acquire, control of the Company. These provision could limit the price that
certain investors might be willing to pay in the future for shares of the
Company's Common Stock.
CONTROL BY PRINCIPAL STOCKHOLDERS
As of August 31, 1997, members of the Channell family (or entities
controlled by them) own 64.0% of the outstanding Common Stock. As a result of
their interests in the Company, the members of the Channell family together are
able to elect a majority of the Board of Directors and control the management
and affairs of the Company.
LIMITATION ON DIVIDENDS
The Company's policy is to retain its future earnings to finance the growth
and development of its business and the Company does not anticipate declaring or
paying cash dividends on its Common Stock in the foreseeable future.
SHARES AVAILABLE FOR FUTURE PUBLIC SALE
In addition to shares already publicly held, as of August 31, 1997 up to
4,942,780 shares held by current directors and executive officers (excluding
shares issuable upon exercise of stock options) are currently available for sale
pursuant to Rule 144 under the Securities Act.
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USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
shares of Common Stock offered hereby.
SELLING STOCKHOLDERS
The shares of Common Stock covered by this Prospectus are being registered
for reoffers and resales by Selling Stockholders of the Company who have or may
acquire such shares pursuant to the exercise of options that may be granted
under the Company's 1996 Stock Plan (the "Stock Plan") or the Company's 1996
Performance-Based Annual Incentive Compensation Plan (the Compensation Plan").
The Selling Stockholders named below may resell all, a portion, or none of the
shares that they have acquired or may acquire pursuant to the exercise of
options.
Key employees deemed to be "affiliates" of the Company who acquire
registered Common Stock under the Plan may be added to the Selling Stockholders
listed below from time to time, either by means of a post-effective amendment
hereto or by use of a prospectus filed pursuant to Rule 424 under the Securities
Act. An "affiliate" is defined in Rule 405 under the Securities Act as a
"person that directly, or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with," the Company.
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The following table shows the names of the Selling Stockholders, their
positions with the Company, the number of shares of Common Stock known by the
Company to be beneficially owned by them as of August 31, 1997, the number of
shares covered by this Prospectus and the number of shares of Common Stock to be
owned by each Selling Stockholder if such Selling Stockholder were to sell all
of his shares of Common Stock covered by this Prospectus.
<TABLE>
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PERCENTAGE OF
NUMBER OF NUMBER OF NUMBER OF CLASS TO BE
SHARES SHARES COVERED SHARES TO BE BENEFICIALLY
POSITION BENEFICIALLY BY THIS HELD AFTER OWNED AFTER
SELLING STOCKHOLDER WITH THE COMPANY OWNED PROSPECTUS OFFERING(1) OFFERING(1)
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William H. Channell Chairman of the 3,420,830 -- 3,420,830 33.4
Board and Chief
Executive Officer
William H. Channell, Jr. President 1,519,250 150,000 1,669,250 16.3
Gary W. Baker Chief Financial 700 24,000 24,700 (2)
Officer
Andrew M. Zogby Vice President, 700 24,000 24,700 (2)
Marketing
Edward J. Burke Vice President, -- 24,000 24,000 (2)
Engineering
Dale C. Wooding Vice President, 300 24,000 24,300 (2)
Manufacturing
John B. Kaiser Vice President, Sales -- 24,000 24,000 (2)
Gary M. Napolitano Vice President, RMS -- 18,000 18,000 (2)
Division
Eugene R. Schutt, Jr. Director 1,000 2,000 3,000 (2)
Richard A. Cude Director -- 2,000 2,000 (2)
Jacqueline M. Channell Director -- 2,000 2,000 (2)
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Assumes that no additional shares are purchased and sold by any Selling
Stockholder.
(2) Less than one percent of outstanding shares.
-xi-
<PAGE>
PLAN OF DISTRIBUTION
The sale of all or a portion of the shares of Common Stock offered hereby
by the Selling Stockholders may be effected from time to time on the NASDAQ-NMS
at prevailing prices at the time of such sales, at prices related to such
prevailing prices or at negotiated prices. The Selling Stockholders may effect
such transactions by selling to or through one or more broker-dealers, and such
broker-dealers may receive compensation in the form of underwriting discounts,
concessions or commissions from the Selling Stockholders. The Selling
Stockholders and any broker-dealers that participate in the distribution may be
deemed to be "underwriters" within the meaning of the Securities Act, and any
commissions received by such broker-dealers and any profits realized on the
resale of shares by them may be deemed to be underwriting discounts and
commissions under the Securities Act. The Selling Stockholders may agree to
indemnify such broker-dealers against certain liabilities, including liabilities
under the Securities Act.
To the extent required under the Securities Act, a supplement to this
Prospectus will be filed disclosing (a) the name of any such broker-dealers, (b)
the number of shares involved, (c) the price at which such shares are to be
sold, (d) the commissions paid or discounts or concessions allowed to such
broker-dealers, where applicable, (e) that such broker-dealers did not conduct
any investigation to verify the information set out or incorporated by reference
in this Prospectus, as supplemented, and (f) other facts material to the
transaction.
There is no assurance that any of the Selling Stockholders will sell any or
all of the shares of Common Stock offered hereby.
The Company has agreed to pay certain costs and expenses incurred in
connection with the registration of the shares of Common Stock offered hereby,
except that the Selling Stockholders shall be responsible for all selling
commissions, transfer taxes and related charges in connection with the offer and
sale of such shares.
LEGAL MATTERS
The validity of the securities offered hereby will be passed upon for the
Company by the law firm of Irell & Manella LLP, Los Angeles, California.
EXPERTS
The consolidated financial statements as of December 31, 1996 and 1995 and
for each of the three years in the period ended December 31, 1996 incorporated
in this Prospectus by reference from the Company's Annual Report on Form 10-K
for the year ended December 31, 1996, have been audited by Grant Thornton LLP,
independent auditors, as stated in their report, which is incorporated herein by
reference, and has been so incorporated in reliance upon the report of such firm
given upon their authority as experts in accounting and auditing.
-xii-
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Commission by the Company are
incorporated herein by reference:
(1) the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996;
(2) the Company's Quarterly Report on Form 10-Q for the fiscal
quarters ended March 31, 1997 and June 30, 1997; and
(3) the description of the Common Stock contained in the Form 8-A
Registration Statement registering the Common Stock pursuant to Section
12(g) of the Exchange Act, and any amendments thereto filed with the
Commission for the purpose of updating such description.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 and
15(d) of the Exchange Act subsequent to the date this Registration Statement is
filed with the Commission, and prior to the filing of a post-effective amendment
which indicates that all securities offered by this Registration Statement have
been sold or which deregisters all such securities then remaining unsold, shall
be deemed to be incorporated by reference in this Registration Statement and to
be a part hereof from the date of the filing of such documents. Any statement
contained in a document incorporated or deemed to be incorporated herein by
reference 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 which also is, or is deemed to be, incorporated by
reference herein modifies or supersedes such prior 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, except as indicated herein.
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 Company's Restated Certificate of Incorporation contains provisions to
eliminate the personal liability of its directors for monetary damages resulting
from breaches of their fiduciary duty to the extent permitted by the Delaware
Law and to indemnify its directors and officers to the fullest extent permitted
by Section 145 of the Delaware Law. The Company has also entered into indemnity
agreements with each of its executive officers and directors providing, among
other things, that the executive officer or director shall be indemnified to the
fullest extent permitted by applicable law.
-xiii-
<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
None.
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------ -----------
<S> <C>
4 Form of Common Stock Certificate(1)
5 Legal Opinion of Irell & Manella LLP(2)
23.1 Consent of Independent Auditors - Grant Thornton LLP(2)
23.2 Consent of Irell & Manella LLP (included in legal opinion filed as
Exhibit 5)
24 Power of Attorney (included on the signature pages filed herewith)
99.1 Channell Commercial Corporation 1996 Incentive Stock Plan (1)
99.2 Channell Commercial Corporation 1996 Performance-Based Annual
Incentive Compensation Plan (1)
</TABLE>
________________
(1) Incorporated by reference to Amendment No. 1 to the Company's
Registration Statement on Form S-1 (No. 333-3621).
(2) Filed herewith.
ITEM 9. UNDERTAKINGS.
1. The undersigned registrant hereby undertakes:
(a) 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;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or
the most recent post-effective amendment hereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration
Statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement;
provided, however, that paragraphs (1)(a)(i) and (1)(a)(ii) will not apply if
- -------- -------
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 Section 15(d) of the Exchange Act that are incorporated by
reference in this Registration Statement.
-xiv-
<PAGE>
(b) That, for the purpose of determining any liability under the
Securities Act, 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.
(c) 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.
2. The undersigned registrant hereby further undertakes that, for
purposes of determining any liability under the Securities Act, each filing of
the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in this 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.
3. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the provisions described under Item 6 above, or
otherwise, the registrant has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities 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 Securities Act and will be governed by the final
adjudication of such issue.
-xv-
<PAGE>
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 Temecula, State of California, on this 19th day of
September, 1997.
Channell Commercial Corporation
(a Delaware corporation)
Registrant
By:/s/ WILLIAM H. CHANNELL, JR.
------------------------------
William H. Channell, Jr.
President and Director
-xvi-
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned officers and directors of Channell Commercial
Corporation, a Delaware corporation, do hereby constitute and appoint William H.
Channell, Jr., President and Director, and Gary W. Baker, Chief Financial
Officer, the lawful attorneys-in-fact and agents, with full power and authority
to do any and all acts and things and to execute any and all instruments which
said attorneys and agents determine to be necessary or advisable or required to
enable said corporation to comply with the Securities Act of 1933, as amended,
and any rules or regulation or requirements of the Commission in connection with
this Registration Statement. Without limiting the generality of the foregoing
power and authority, the powers granted include the power and authority to sign
the names of the undersigned officers and directors in the capacities indicated
below to this Registration Statement, to any and all amendments, both pre-
effective and post-effective, and supplements to this Registration Statement and
to any and all instruments or documents filed as part of or in connection with
this Registration Statement or amendments or supplements thereof, and each of
the undersigned hereby ratifies and confirms all that said attorneys and agents
shall do or cause to be done by virtue hereof. This Power of Attorney may be
signed in several counterparts.
IN WITNESS WHEREOF, each of the undersigned has executed this Power of
Attorney as of September 19, 1997.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities indicated on September 19, 1997.
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ WILLIAM H. CHANNELL, SR. Chairman of the Board and Chief Executive
- ---------------------------- Officer of Channell Commercial
William H. Channell, Sr. Corporation (Principal Executive Officer)
/s/ WILLIAM H. CHANNELL, JR. President and Director
- ----------------------------
William H. Channell, Jr.
/s/ GARY W. BAKER Chief Financial Officer of Channell
- ----------------- Commercial Corporation (Principal
Gary W. Baker Financial and Accounting Officer)
/s/ JACQUELINE H. CHANNELL Secretary and Director
- --------------------------
Jacqueline M. Channell
</TABLE>
-xvii-
<PAGE>
<TABLE>
<S> <C>
Director
- --------------------
Eugene R. Schutt, Jr.
/s/ Richard A. Cude Director
- -------------------
Richard A. Cude
</TABLE>
-xviii-
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
EXHIBITS
TO
FORM S-8
UNDER
SECURITIES ACT OF 1933
CHANNELL COMMERCIAL CORPORATION
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------ -----------
<S> <C>
4 Form of Common Stock Certificate (1)
5 Legal Opinion of Irell & Manella LLP (2)
23.1 Consent of Independent Auditors - Grant Thornton LLP (2)
23.2 Consent of Irell & Manella LLP (included in legal opinion filed as
Exhibit 5)
24 Power of Attorney (included on the signature pages filed herewith)
99.1 Channell Commercial Corporation 1996 Incentive Stock Plan (1)
99.2 Channell Commercial Corporation 1996 Performance-Based Annual
Incentive Compensation Plan (1)
</TABLE>
_________________
(1) Incorporated by reference to Amendment No. 1 to the Company's
Registration Statement on Form S-1 (No. 333-3621).
(2) Filed herewith.
-xix-
<PAGE>
EXHIBIT 5
LEGAL OPINION OF IRELL & MANELLA LLP
[LETTERHEAD OF IRELL & MANELLA LLP]
September 22, 1997
Channell Commercial Corporation
26040 Ynez Road
Temecula, California 92591-9022
Ladies and Gentlemen:
We have acted as counsel for Channell Commercial Corporation, a Delaware
corporation (the "Company"), in connection with the proposed filing with the
Securities and Exchange Commission expected to be made on or about September 19,
1997 under the Securities Act of 1933, as amended, of a Registration Statement
on Form S-8 (the "Registration Statement") for the purpose of registering
1,000,000 shares of the Company's Common Stock, par value $.01 per share (the
"Shares") that have been or may be issued in accordance with the terms and
conditions of the Channell Commercial Corporation 1996 Incentive Stock Plan and
the Channell Commercial Corporation 1996 Performance-Based Annual Incentive
Compensation Plan. As your counsel in connection with this transaction, we have
examined such matters and documents as we have deemed necessary or relevant as a
basis for this opinion.
Based on these examinations, it is our opinion that the Shares, when issued
and paid for in the manner referred to in the Registration Statement, will be
legally and validly issued, fully-paid and non-assessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to the reference to this firm under the caption
"Legal Matters" in the Reoffer Prospectus forming a part of this Registration
Statement.
Very Truly Yours,
/s/ IRELL & MANELLA LLP
-----------------------
Irell & Manella LLP
-xx-
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS -- GRANT THORNTON LLP
We consent to the incorporation by reference in this Registration Statement of
Channell Commercial Corporation on Form S-8 of our report dated January 30,
1997, appearing in the Annual Report on Form 10-K of Channell Commercial
Corporation for the year ended December 31, 1996 and to the reference to us
under the heading "Experts" in the Prospectus, which is part of this
Registration Statement.
/s/ GRANT THORNTON LLP
- ----------------------
Grant Thornton LLP
Los Angeles, CA
September 18, 1997
-xxi-
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
Reference is made to the signature pages of this Registration Statement.
-xxii-
