As filed with the Securities and Exchange Commission on December 20, 2000.
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF l933
GENERAL DATACOMM INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 06-0853856
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
Park Road Extension, Middlebury, Connecticut 06762-l299
(203) 758-1811
(Address, including zip code, and telephone number, including area
code, of Registrant's principal executive offices)
1998 STOCK OPTION PLAN
(Full title of the plan)
HOWARD S. MODLIN, ESQ., Weisman Celler Spett & Modlin, P.C.
445 Park Avenue, New York, New York l0022
(2l2) 37l-5400
(Name, address and telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
Title of Securities to be Price Offering Registration
to be Registered Registered Per Unit(1) Price Fee
------------------- ---------- ----------- --------- ------------
Common Stock, par 500,000 $1.25 $625,000 $173.75
value, $.l0 per share
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(1) Estimated pursuant to Rule 457(c) solely for the purpose of calculating
the registration fee based upon the closing price of shares of the
Registrant's common stock, par value $.l0 per share on December 13, 2000
on the New York Stock Exchange.
Rule 429: The prospectus contained herein is a combined prospectus with
Registration No. 333-89571.
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GENERAL DATACOMM INDUSTRIES, INC.
1998 STOCK OPTION PLAN
Cross Reference Sheet Between Items of Form S-8 and Prospectus
Item Required by Form S-8 Caption in Prospectus
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1. Plan Information Cover Page;
1998 Stock Option Plan;
Federal Income Tax Consequences
2. Registrant Information Available Information
and Employee Plan Annual
Information
ii
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PROSPECTUS
GENERAL DATACOMM INDUSTRIES, INC.
Park Road Extension
Middlebury, Connecticut 06762-1299
203-758-1811
1998 STOCK OPTION PLAN
2,000,000 Shares of Common Stock, $.10 par value
This prospectus relates to the offering by General DataComm Industries,
Inc. ("GDC") of the shares of Common Stock covered hereby to our employees and
directors and employees of our subsidiaries as may be granted options to
purchase shares pursuant to our 1998 Stock Option Plan which is described in
this prospectus.
Certain of the optionees may, from time to time, sell or otherwise
dispose of some or all of the shares of Common Stock which may be acquired by
them. Certain of the resales or other dispositions may be made pursuant to this
Prospectus, but others may be made by employees who are deemed to be
"affiliates" of the Corporation within the meaning of the Securities Act of
1993, as amended ("Securities Act"), and such persons may effect such resales
only pursuant to a separate prospectus or an appropriate exemption from
registration.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined whether
this prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
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The date of this prospectus is December 20, 2000
This document constitutes a prospectus covering securities that have been
registered under the Securities Act of 1933, as amended.
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No person has been authorized by us to give any information or to
make any representation not contained in this Prospectus in connection with the
offering covered by this Prospectus and, if given or made, such information or
representation must not be relied upon as having been authorized by us. Neither
the delivery of this Prospectus nor any sales made hereunder shall under any
circumstances create any implication that there has been no change in our
affairs since the date hereof.
TABLE OF CONTENTS
PAGE
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REGISTRATION STATEMENT 2
WHERE YOU CAN FIND MORE INFORMATION 3
1998 STOCK OPTION PLAN 4
FEDERAL INCOME TAX CONSEQUENCES 6
DESCRIPTION OF CAPITAL STOCK 7
LEGAL MATTERS 17
INDEPENDENT ACCOUNTANTS 17
INDEMNIFICATION 17
REGISTRATION STATEMENT
We have filed with the Securities and Exchange Commission, Washington,
D.C. Registration Statements (hereinafter, as amended to date, referred to as
the "Registration Statements") on Form S-8 (File Nos. 333-89571 and 333-
_________) under the Securities Act in respect of 2,000,000 shares of the
Corporation's Common Stock, $.10 par value, subject to adjustment, which may be
purchased from time to time pursuant to stock options issued to our key
employees, including our officers and directors who are employees and non
employee directors and employees of our subsidiaries under our 1998 Stock Option
Plan (the "1998 Plan"). For further information with respect to GDC and the
securities offered by this Prospectus, reference is made to the Registration
Statements and the exhibits filed as a part thereof.
The statements made about the 1998 Plan in this Prospectus are
summaries of certain provisions of the 1998 Plan, a copy of which is an exhibit
to this Registration Statement. Reference is made to the 1998 Plan for complete
statements of such provisions, and such summaries are qualified in this entirety
by such reference.
Any optionee who may be deemed an affiliate of GDC, as defined in Rule
405 issued under the Securities Act must utilize an exemption, including Rule
144, from the registration provisions of the Securities Act to sell shares
received pursuant to the exercise of an option unless a separate prospectus is
in effect.
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WHERE YOU CAN FIND MORE INFORMATION
Federal securities law requires us to file information with the SEC
concerning our business and operations. We file annual, quarterly and special
reports, proxy statements and other information with the SEC. You can read and
copy these documents at the public reference facility maintained by the SEC at
Judiciary Plaza, 450 Fifth Street, NW, Room 1024, Washington, DC 20549. You can
also copy and inspect such reports, proxy statements and other information at
the regional offices of the SEC located at Seven World Trade Center, 13th Floor,
New York, New York 10048 and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661.
Please call the SEC at 1-800-SEC-0330 for further information on
the public reference rooms. Our SEC filings are also available to the public on
the SEC's web site at http://www.sec.gov. You can also inspect our reports,
proxy statements and other information at the offices of the New York Stock
Exchange.
The SEC allows us to "incorporate by reference" the information we
file with it, which means that we can disclose important information to you by
referring you to those documents. The information that we incorporate by
reference is considered to be part of this prospectus, and later information
that we file with the SEC will automatically update and/or supersede this
information. We incorporate by reference the documents listed below and any
future filings made by us with the SEC under Sections 13(a), 13(c), 14 or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"):
1. Our Annual Report on Form 10-K for the year ended September 30, 1999.
2. Our quarterly reports on Form 10-Q for the quarters ended December 31,
1999, March 31, 2000 and June 30, 2000.
3. Our current reports on Form 8-K dated May 17, 2000 and July 31, 2000.
4. The Definitive Proxy Statement for the Annual Meeting of GDC on
Schedule 14A, dated January 4, 2000.
This prospectus is part of registration statements we filed with
the SEC (Registration No. 333-89571 and 333- _____). You may request a free copy
of any of the above filings by writing or calling Vice President Business
Development, General DataComm Industries, Inc., Park Road Extension, Middlebury,
CT 06762-1299 (telephone number (203) 758-1811).
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You should rely only on the information incorporated by reference or provided in
this prospectus or any supplement to this prospectus. We have not authorized
anyone else to provide you with different information. You should not assume
that the information in this prospectus or any supplement to this prospectus is
accurate as of any date other than the date on the cover page of this prospectus
or any supplement.
1998 STOCK OPTION PLAN
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Purpose and Eligibility
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The 1998 Plan was originally adopted by our directors on April 22, 1998
as a "broad based Stock Option Plan" as permitted by the policy of the New York
Stock Exchange for the purpose of enabling GDC and its subsidiaries to provide
an inducement to attract and keep able and qualified key employees, including
officers and directors who are employees and non-employee directors, by the
grant of non-statutory stock options up to a present maximum of 2,000,000
shares. At all times a minimum of 20% of our employees must be eligible for
grants of options under the 1998 Plan, and less than 50% of the persons eligible
for options shall be officers. The granting of options is determined by our
Chairman of the Board who administers the 1998 Plan to all persons, other than
employees subject to Section 16 of the Securities Exchange Act of 1934
("Exchange Act") who are generally executive officers and directors, and reports
to the Board of Directors the names of those granted options, the number of
shares covered by each option and the applicable option prices. The Stock Option
Committee of the Board of Directors reports to the Board of Directors with
respect to the names of employees and non-employee directors subject to Section
16 of the Exchange Act who are granted stock options, the number of shares
covered by each such option, and the applicable option prices. The Chairman of
the Board, or the Stock Option Committee, as the case may be, subject to the
provisions of the 1998 Plan, has sole discretion to determine the persons to
whom options shall be granted, the number of shares to be subject to each option
and the increments by which such granted options are exercisable. In making such
determination, the Chairman of the Board or the Stock Option Committee, as the
case may be, considers in his or their opinion those employees or non-employee
directors, as the case may be, who perform services of special importance to the
management, operation and development of our business provided that no employee
whose basis salary before bonuses or incentive payments is less than $20,000 per
year is eligible to receive an option. There is no limitation with respect to
the number of shares that are subject to grant of option to any one employee. It
is presently expected that approximately 900 employees and all three
non-employee directors are eligible to receive options under the 1998 Plan.
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Shares Available and Exercise of Options
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The 1998 Plan provides for options to purchase an aggregate of
2,000,000 shares of Common Stock of the Corporation. Such amount is subject to
appropriate adjustment in the event of changes in our outstanding common stock
by reason of stock dividends or splits in excess of 5% in any one year, mergers,
consolidations, exchanges or reorganizations.
The stock options granted under the 1998 Plan are non-statutory stock
options. The 1998 Plan provides that each option granted is exercisable, in
whole or in part, from time to time during the term thereof as may be determined
by the Chairman of the Board or the Stock Option Committee, as the case may be,
and as stated in each option granted, commencing one (1) year after the date of
grant of the option; and that the options expire unless exercised on or before
ten (10) years from the date of grant. Such one (1) year restriction may be
waived by the Chairman of the Board or Stock Option Committee, as the case may
be, in their discretion as to any option or options.
The option price of the non-statutory stock options shall be the fair
market value of our Common Stock at the time of grant or such greater price as
determined by the Chairman of the Board or the Stock Option Committee, as the
case may be. The term of each non-statutory stock option may not exceed ten (10)
years from the date of grant. If an optionee holds more than one non-statutory
stock option, such options may be exercised by the optionee in any order.
Options are exercised by the payment of cash or the delivery of our
common stock valued at the market price for such shares at the time of exercise.
As of September 30, 2000, 2,568,706 options have been granted under the
1998 Plan to 479 employees at an average exercise price of $3.98. Of such
granted options, 64,550 have been exercised, 1,762,777 remain outstanding,
741,379 have been canceled and 172,673 options remain available for grant at
such date. Options may not be granted under the 1998 Plan after April 22, 2008.
Limitations in Participation
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Except for gifts to family members or a transfer pursuant to a domestic
relations order, options are not transferable other than by will or by the laws
of descent and distribution. If an optionee becomes permanently and totally
disabled or dies while employed by us, the option granted to the optionee may be
exercised only within one (1) year following the date of such permanent and
total disability or death, by the optionee in the case of such disability, and
by the person or persons to whom the Optionee's rights under the option shall
pass by the Optionee's will or the laws of descent and distribution in the case
of death, to the extent of the following schedule, but in no event after the
expiration of the term of the option.
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Time from Grant of Option
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From To (the end of) Percentage Exercisable
---- --------------- ----------------------
1 day 12 months 33%
12 months 24 months 67%
Over 24 months 100%
If an optionee ceases to be employed by us or a non-employee's
directorship terminates for any reason other than death or disability, he or she
may, but only within the three (3) months following such cessation of
employment, exercise his or her option to the extent that he or she was entitled
to exercise it at the date of such cessation, unless the optionee was discharged
for cause. If an optionee is discharged for cause, or the optionee fails to give
reasonable notice of termination of employment, such option terminates on the
date of such discharge and the optionee forfeits any and all rights which may
have accrued prior thereto. The above restrictions apply to options which were
permitted gifts on transfers.
Modification
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Our Board of Directors may at any time, or from time to time, without
stockholder approval, suspend, terminate or amend the 1998 Plan in such respects
as it shall deem advisable.
FEDERAL INCOME TAX CONSEQUENCES
Tax Aspects - Non-statutory Stock Options
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Messrs. Weisman Celler Spett & Modlin, P.C., our legal counsel, have
advised us that under existing Treasury regulations with respect to
non-statutory stock options, (i) an optionee will not realize taxable income
upon the grant of an option; (ii) the difference between the option price and
the fair market value of the shares on the date of exercise is taxable as
ordinary income to the optionee at the time of exercise and is allowable to us
as an income tax deduction; (iii) the ordinary income to the optionee will be
treated as compensation to the optionee which is subject to income tax
withholding by us; (iv) the optionee will take a basis in the shares equal to
the sum of the option price plus the amount taxed to him or her as compensation
income; and (v) any gain or loss on a subsequent sale of the shares, which will
equal the difference between the sales proceeds and the optionee's basis in the
shares, will be capital gain or loss at the time of sale. If the optionee holds
the shares for more than one year, such gain or loss will be treated as a
long-term capital gain or loss, with any such long-term capital gain taxed at a
maximum rate of 20%.
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Employee Retirement Income Security Act of 1974
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The 1998 Plan is not subject to any of the provisions of the Employee
Retirement Income Security Act of 1974 or of Section 401 (a) of the Internal
Revenue Code of 1986.
DESCRIPTION OF CAPITAL STOCK
Our current authorized capital consists of 50,000,000 shares of
common stock, par value $.10 per share, 10,000,000 shares of Class B Stock, par
value $.10 per share and 3,000,000 shares of Preferred Stock, par value $1.00
per share.
The Board of Directors is authorized pursuant to our Restated
Certificate of Incorporation ("Charter") to provide for the issue of the shares
of Preferred Stock in one or more series with such rights as the Board of
Directors may determine.
Common Stock
The holders of shares of our common stock are entitled to one vote
per share on all matters submitted to stockholders. They are also entitled to
vote separately as a class as are the holders of shares of the Class B Stock on
all matters requiring an amendment to our Charter as well as on mergers,
consolidations and certain other significant transactions for which stockholder
approval is required under Delaware law. Holders of the common stock do not have
preemptive rights or cumulative voting rights.
Dividends on our common stock will be paid if, and when, declared.
However, if a cash dividend is paid in respect of the common stock, a cash
dividend must also be paid on the Class B Stock in an amount per share of Class
B Stock equal to 90% of the amount of the cash dividends paid on each share of
the common stock. Otherwise, however, our common stock and the Class B Stock
rank equally as to dividends.
We have never paid cash dividends on the common stock or Class B
Stock and cash dividends, except as provided for in our loan and security
agreement allowing payment of dividends on our 9% Preferred Stock, are not
permitted by our loan and security agreement. Stock dividends on and stock
splits of common stock will only be payable or made in shares of common stock.
Upon our liquidation, dissolution or winding up of our affairs, the
holders of our common stock and Class B stock, sharing ratably as one class, are
entitled to receive the entire net assets of the Company remaining after payment
of all debts and other claims of creditors and after the holders of each series
of preferred stock, if any, have been paid the
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preferred liquidating distribution on their shares, if any, as fixed by our
Board of Directors. The common stock is not convertible into shares of any other
equity security of GDC.
Our common stock is freely transferable.
Class B Stock
The holders of shares of our Class B Stock are entitled to one vote
per share on all matters submitted to stockholders except that they are entitled
to ten votes per share under certain circumstances in the election of directors.
They are also entitled to vote separately as a class as are the holders of
shares of common stock on all matters requiring an amendment to our Charter as
well as on mergers, consolidations and certain other significant transactions
for which stockholder approval is required under Delaware law. Holders of our
Class B Stock do not have preemptive rights or cumulative voting rights.
Dividends on our Class B Stock will be paid only as and when
dividends on the common stock are declared and paid. Moreover, if a cash
dividend is paid in respect of the common stock, a cash dividend must also be
paid on the Class B Stock in an amount per share of Class B Stock equal to 90%
of the amount of the cash dividends paid on each share of common stock.
Otherwise, however, the common stock and the Class B Stock rank equally as to
dividends. Stock dividends on and stock splits of Class B Stock will only be
payable or made in shares of Class B Stock.
In the event of our liquidation or insolvency, the holders of Class
B Stock and common stock share ratably in the assets remaining after payment of
all debts and other claims of creditors, subject to the rights of any preferred
stock which may be issued in the future.
Holders of our Class B Stock may elect at any time to convert any
of or all such shares to shares of our common stock on a share-for-share basis.
In the event that the number of outstanding shares of Class B Stock falls below
5% of the aggregate number of issued and outstanding shares of common stock and
Class B Stock, or the Board of Directors and holders of a majority of the
outstanding shares of Class B Stock approve the conversion of the Class B Stock
into common stock, then the Class B Stock will automatically be converted into
shares of common stock. In the event of such conversion, certificates formerly
representing outstanding shares of Class B Stock will thereafter be deemed to
represent the number of shares of common stock corresponding to the number of
shares of Class B Stock thus converted.
The Class B Stock is not transferable except to certain family
members and related entities of the holder thereof.
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Special Voting Requirements
Our Charter contains a provision requiring a two-thirds vote on any
merger or consolidation or any sale or other disposition of all or substantially
all of our assets. It also contains a "fair price" provision requiring all
stockholders to receive equal treatment in the event of a takeover which may be
coercive. This "fair price" provision may not be amended except by a four-fifths
vote of the stockholders and may be considered to have the effect of
discouraging tender offers, takeover attempts, acquisitions or business
combinations involving us. That provision also requires that business
combinations involving us and certain "Acquiring Persons", who are any persons
or entities which directly or indirectly own or control at least 5% of our
voting stock, be approved by the holders of four-fifths of our outstanding
shares entitled to vote (other than shares held by an Acquiring Person with
which or by or on whose behalf a business combination is proposed) unless such
business combination either:
- Has been authorized by our Board of Directors prior to the time that
the Acquiring Person involved in such business combination became an
Acquiring Person; or
- will result in the receipt by our other stockholders of a specified
minimum amount and form of payment for their shares.
Anti-Takeover Statute
Section 203 of the Delaware General Corporation Law ("Delaware
Section 203") is applicable to corporate takeovers in Delaware. Subject to
certain exceptions set forth therein, Delaware Section 203 provides that a
corporation shall not engage in any business combination with any "interested
stockholder" for a three-year period following the date that such stockholder
becomes an interested stockholder unless:
- Prior to such date, the board of directors of the corporation approved
either the business combination or the transaction which resulted in
the stockholder becoming an interested stockholder;
- upon consummation of the transaction which resulted in the stockholder
becoming an interested stockholder, the interested stockholder owned at
least 85% of the voting stock of the corporation outstanding at the
time the transaction commenced (excluding certain shares); or
- on or subsequent to such date, the business combination is approved by
the board of directors of the corporation and by the affirmative vote
of at least 66-2/3% of the outstanding voting stock which is not owned
by the interested stockholder.
An interested stockholder is defined to include any person who,
together with affiliates and associates, owns, or within the prior three (3)
years did own, 15% or more of the corporation's voting stock. Delaware Section
203 could make it more difficult for an
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"interested stockholder" to effect various business combinations with a
corporation for a three-year period although the stockholders may, by adopting
an amendment to the corporation's certificate of incorporation or by-laws, elect
not to be governed by this section, effective twelve months after adoption. Our
Charter and By-laws do not exclude us from the restrictions imposed under
Delaware Section 203.
Preferred Stock - General
Preferred Stock, including our 5% Preferred Stock and 9% Preferred
Stock, may be issued in one or more series from time to time by action of our
Board of Directors. The shares of any series of Preferred Stock may be
convertible into our common stock, may have priority over the common stock and
Class B Stock in the payment of dividends and as to the distribution of assets
in the event of our liquidation, dissolution or winding up of our affairs and
may have preferential or other voting rights, in each case, to the extent, if
any, determined by our Board of Directors at the time it creates the series of
Preferred Stock. The 5% Preferred Stock and 9% Preferred Stock are our only
classes of Preferred Stock outstanding.
5% Preferred Stock
We have outstanding 200,000 shares of 5% Preferred Stock. The 5%
Preferred Stock has a liquidation preference of $25.00 per share and ranks as to
dividends and liquidation prior to the common stock and on a parity with the 9%
Preferred Stock. The 5% Preferred Stock is fully paid and nonassessable. Holders
of 5% Preferred Stock do not have any preemptive rights. The 5% Preferred Stock
is not subject to any sinking fund or other obligation to redeem or retire such
stock except it will automatically convert into common stock two (2) years from
issuance on July 31, 2002 unless extended for failure of the underlying shares
of common stock to be registered.
Holders of shares of our 5% Preferred Stock will be entitled to
receive, when, if and as declared by our Board of Directors out of our funds
legally available for payment, dividends at the annual rate of 5% or $1.25 per
share. Dividends are payable quarterly in arrears on January 31, April 30, July
31, and October 31 of each year. Dividends on the 5% Preferred Stock are
cumulative from the date of original issue and at the option of the Board of
Directors are payable in common stock or cash. We have not declared or paid
dividends for the quarterly period ended October 31, 2000.
So long as our 5% Preferred Stock is outstanding, we may not
declare or pay any dividend on common stock or other stock ranking junior to or
on a parity with the 5% Preferred Stock or acquire common stock or any other
stock ranking junior to or on a parity with the 5% Preferred Stock (except by
conversion into or exchange for any stock ranking junior to the 5% Preferred
Stock), unless the full cumulative dividends on the 5% Preferred Stock have been
paid, or contemporaneously are declared and paid, through the last
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dividend payment date. Should dividends not be paid in full on the 5% Preferred
Stock, and any other preferred stock ranking on a parity as to dividends with
the 5% Preferred Stock, all dividends declared on the 5% Preferred Stock and any
other preferred stock ranking on a parity as to dividends with the 5% Preferred
Stock will be declared pro rata, so that the amount of dividends declared per
share on the 5% Preferred Stock and such other preferred stock will bear to each
other the same ratio that accumulated dividends per share on the shares of 5%
Preferred Stock and such other preferred stock bear to each other. No interest,
or sum of money in lieu of interest, shall be payable in respect of any dividend
payment or payments on the 5% Preferred Stock which may be in arrears. The 5%
Preferred Stock and our 9% Preferred Stock are on a parity.
We are not currently permitted by our principal loan agreement to
pay cash dividends on the 5% Preferred Stock, so it is intended all such
dividends will be payable in shares of common stock registered under another
prospectus.
The holders of our 5% Preferred Stock are entitled at any time to
convert the shares of the 5% Preferred Stock into common stock at the conversion
price of $5.00 per share, subject to adjustment, or presently 5 shares of common
stock for each share of 5% Preferred Stock, except that, with respect to shares
of the 5% Preferred Stock called for automatic conversion or redemption,
conversion rights will expire at the close of business on the redemption date,
unless with respect to redemption, we default in payment of the redemption
price.
The conversion price is subject to potential adjustment on six
reset dates commencing January 31, 2001 and each three (3) months thereafter if
the trading price of our common stock is less than the conversion price then in
effect based on the average closing price for ten (10) trading days preceding
the reset date. There was a potential earlier reset date following release of
our September 30, 2000 quarter results if our net worth fell below a formula
which did not occur because such net worth exceeded the formula. Subject to
consent under our revolving credit and term loan facility we have the right to
redeem some or all of the 5% Preferred Stock at 105% of the redemption price of
$25.00 per share plus accumulated and unpaid dividends in order to avoid the
reset by written notice given at least 15 days prior to the reset date. If we
fail to redeem the shares on any reset date for which we have given notice of
redemption, we will lose the right to repurchase the shares for any future reset
date if there is an adjustment. We have given notice that we will redeem all of
the outstanding 5% Preferred Stock to avoid any such reset, if applicable.
In the event of our voluntary or involuntary liquidation,
dissolution or winding-up, the holders of shares of the 5% Preferred Stock will
be entitled to receive, out of the assets available for distribution to
stockholders, before any distribution or payment is made to holders of common
stock or any other stock ranking junior upon liquidation to the 5%
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Preferred Stock, liquidating distributions in the amount of $25.00 per share
plus all accumulated and unpaid dividends to the date of liquidation.
Subject to consent under our revolving credit and term loan
facility, we have the right to redeem the 5% Preferred Stock at $25.00 per share
plus any accumulated and unpaid dividends, on no less than 30 days and no more
than 60 days notice if we sell assets or one or more business units for net
proceeds of $50 million or more or sell securities in an underwritten public
offering in excess of $50 million and a registration statement is in effect for
the shares of common stock into which the 5% Preferred Stock is convertible.
We also have the right by no less than 30 days nor more than sixty
(60) days written notice to cause the 5% Preferred Stock to be automatically
convertible into common stock if the closing price (as defined) of the common
stock has equaled or exceeded 125% of the conversion price then in effect for at
least 20 trading days within 30 consecutive trading days ending within five
trading days before notice of conversion is mailed, and a registration statement
is in effect for the shares of common stock to be issued.
Unless full cumulative dividends on all outstanding shares of our
5% Preferred Stock and any other preferred stock ranking on a parity with the 5%
Preferred Stock have been or contemporaneously are declared and paid for all
past dividend periods, the 5% Preferred Stock may not be redeemed and we may not
purchase or otherwise acquire any shares of the 5% Preferred Stock.
If we are to be merged into another corporation, the holders of the
5% Preferred Stock will have the option by written notice given with fifteen
(15) days after receipt of notice of the stockholders meeting called to approve
the merger to either convert their 5% Preferred Stock into our common stock at
the then conversion price or require the surviving corporation to redeem our 5%
Preferred Stock at 125% of its liquidation value. If such option is not
exercised, the 5% Preferred Stock will automatically convert into our common
stock at the end of the fifteen (15) day period.
Except as required by the Delaware General Corporation Law, the
holders of 5% Preferred Stock will not be entitled to vote.
The approval of the holders of at least a majority of the shares of
the 5% Preferred Stock then outstanding will be required to amend, alter or
repeal any of the provisions of the Charter or the Certificate of Designation or
to authorize any reclassification of the 5% Preferred Stock, in either case so
as to affect adversely the preferences, special rights or privileges or voting
power of the 5% Preferred Stock, either directly or indirectly. A similar
majority vote of the holders of the shares of the 5% Preferred Stock then
outstanding is required:
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- to authorize or create any class of stock senior to the 5% Preferred
Stock as to dividends or distributions upon liquidation or;
- to create, issue or increase the authorized number of shares of any
series of our authorized preferred stock ranking senior to the 5%
Preferred Stock as to dividends or distributions upon liquidation; or
- to authorize additional shares of 5% Preferred Stock.
9% Preferred Stock
We have outstanding 787,900 shares of 9% Preferred Stock. The 9%
Preferred Stock has a liquidation preference of $25.00 per share and ranks as to
dividends and liquidation prior to the common stock and on a parity with the 5%
Preferred Stock. The 9% Preferred Stock is fully paid and nonassessable. Holders
of 9% Preferred Stock do not have any preemptive rights. The 9% Preferred Stock
is not subject to any sinking fund or other obligation to redeem or retire such
stock. Unless converted, redeemed or exchanged, the 9% Preferred Stock will
remain outstanding indefinitely.
Holders of shares of our 9% Preferred Stock will be entitled to
receive, when, if and as declared by our Board of Directors out of our funds
legally available for payment, cash dividends at the annual rate of 9% or $2.25
per share. Dividends are payable quarterly in arrears on March 31, June 30,
September 30, and December 31 of each year. Dividends on the 9% Preferred Stock
are cumulative from the date of original issue. We have not declared or paid
dividends for the quarterly period ended September 30, 2000.
So long as our 9% Preferred Stock is outstanding, we may not
declare or pay any dividend on common stock or other stock ranking junior to or
on a parity with the 9% Preferred Stock or acquire common stock or any other
stock ranking junior to or on a parity with the 9% Preferred Stock (except by
conversion into or exchange for our stock ranking junior to the 9% Preferred
Stock), unless the full cumulative dividends on the 9% Preferred Stock have been
paid, or contemporaneously are declared and paid, through the last dividend
payment date. Should dividends not be paid in full on the 9% Preferred Stock,
and any other preferred stock ranking on a parity as to dividends with the 9%
Preferred Stock, all dividends declared on the 9% Preferred Stock and any other
preferred stock ranking on a parity as to dividends with the 9% Preferred Stock
will be declared pro rata, so that the amount of dividends declared per share on
the 9% Preferred Stock and such other preferred stock will bear to each other
the same ratio that accumulated dividends per share on the shares of 9%
Preferred Stock and such other preferred stock bear to each other. No interest,
or sum of money in lieu of interest, shall be payable in respect of any dividend
payment or payments on the 9% Preferred Stock which may be in arrears.
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We are permitted to pay cash dividends on the 9% Preferred Stock,
so long as we are not in default under our revolving credit and term loan
facility and our borrowing availability exceeds $1,000,000 after payment of such
dividend.
The holders of our 9% Preferred Stock are entitled at any time to
convert the shares of the 9% Preferred Stock into common stock at the conversion
price of $13.65 per share subject to adjustment, except that, with respect to
shares of the 9% Preferred Stock called for redemption or exchange, conversion
rights will expire at the close of business on the redemption or exchange date,
unless we default in:
- the payment of the redemption price;
- the issuance of 9% Debentures in exchange for the 9% Preferred Stock; or
- the payment of the final dividend on the exchange date.
The 9% Preferred Stock is exchangeable in whole, but not in part,
at our sole option for 9% Convertible Subordinated Debentures due 2006 (the "9%
Debentures") on any Dividend Payment Date at a rate of $25.00 principal amount
of the 9% Debentures for each share of the 9% Preferred Stock. We may not
exchange any shares of the 9% Preferred Stock unless full cumulative dividends
have been paid or set aside for payment on the 9% Preferred Stock and on any
preferred stock ranking as to dividends on a parity with the 9% Preferred Stock.
On and after the date of exchange of 9% Preferred Stock for 9%
Debentures, the 9% Preferred Stock will cease to accumulate dividends, will no
longer be deemed to be outstanding and will represent only the right to receive
the 9% Debentures and accrued and unpaid dividends, if any, to the Exchange
Date.
In the event of our voluntary or involuntary liquidation,
dissolution or winding-up, the holders of shares of the 9% Preferred Stock will
be entitled to receive, out of the assets available for distribution to
stockholders, before any distribution or payment is made to holders of common
stock or any other stock ranking junior upon liquidation to the 9% Preferred
Stock, liquidating distributions in the amount of $25.00 per share plus all
accumulated and unpaid dividends to the date of liquidation.
The 9% Preferred Stock is redeemable in whole or in part, at our
sole option, at the redemption price of $25.00 per share, plus accumulated and
unpaid dividends to the date fixed for redemption.
Unless full cumulative dividends on all outstanding shares of 9%
Preferred Stock and any other preferred stock ranking on a parity with the 9%
Preferred Stock have been or contemporaneously are declared and paid for all
past dividend periods, the 9% Preferred
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Stock may not be redeemed and we may not purchase or otherwise acquire any
shares of the 9% Preferred Stock.
Except as indicated below or as required by the Delaware General
Corporation Law, the holders of 9% Preferred Stock will not be entitled to vote.
If at any time dividends payable on our 9% Preferred Stock are in
arrears and unpaid in an amount equal to or exceeding the amount of dividends
payable thereon for six quarterly dividend periods, the holders of our 9%
Preferred Stock, voting separately as a class with the holders of any other
series of our preferred stock granted voting rights, will have the right to
elect two (2) directors. These directors would be in addition to the number of
directors constituting our Board of Directors immediately prior to the accrual
of that right. So long as our Board of Directors is divided into classes, our
directors so elected by the holders of shares of the 9% Preferred Stock and
other such preferred stock series would be elected to the classes with the
longest remaining terms. Such voting rights will continue for the 9% Preferred
Stock until all dividends accumulated and payable on that stock have been paid
in full, at which time such voting rights of the holders of the 9% Preferred
Stock will terminate. Such voting rights would revest in the event of a
subsequent similar arrearage. Upon any termination of such voting right the term
of office of all the directors so elected by preferred stockholders voting
separately as a class will terminate. We have not paid dividends for the
quarterly period ended September 30, 2000.
The approval of the holders of at least a majority of the shares of
the 9% Preferred Stock then outstanding will be required to amend, alter or
repeal any of the provisions of the Charter or the Certificate of Designation or
to authorize any reclassification of the 9% Preferred Stock, in either case so
as to affect adversely the preferences, special rights or privileges or voting
power of the 9% Preferred Stock, either directly or indirectly. A similar
majority vote of the holders of the shares of the 9% Preferred Stock then
outstanding is required (a) to authorize or create any class of stock senior to
the 9% Preferred Stock as to dividends or distributions upon liquidation or (b)
to create, issue or increase the authorized number of shares of any series of
our authorized preferred stock ranking senior to the 9% Preferred Stock as to
dividends or distributions upon liquidation.
The 9% Preferred Stock has special rights that become effective
upon the occurrence of certain types of significant transactions affecting
corporate control or our ownership which are deemed a "Change in Control". The
holders of the 9% Preferred Stock shall have the right effective for thirty days
following the mailing date of a notice disclosing a Change in Control to require
us to repurchase all or any part of their shares of 9% Preferred Stock on the
date that is no later than 45 days after the date of such repurchase right
notice, at a repurchase price equal to $25.00 per share, plus accrued and unpaid
dividends to the repurchase date with respect to such shares. We may satisfy our
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repurchase obligations through the issuance of shares of our common stock valued
at the Market Price of the common stock.
A "Change in Control" means the occurrence of any of the following
events:
- any person (including any entity or group deemed to be a "person" under
Section 13(d)(3) or Section 14(d)(2) of the Exchange Act) becomes the
direct or indirect beneficial owner (as determined in accordance with
Rule 13d-3 under the Exchange Act) of shares of our capital stock
representing greater than 50% of the total voting power of all shares
of our capital stock entitled to vote in the election of Directors
under ordinary circumstances or to elect a majority of our Board of
Directors;
- we sell, transfer or otherwise dispose of all or substantially all of
our assets;
- when, during any period of 12 consecutive months after the date of
original issuance of the Preferred Stock, individuals who at the
beginning of any such 12-month period constituted our Board of
Directors (together with any new directors whose election by such Board
or whose nomination for election by our stockholders was approved by a
vote of a majority of the directors still in office who were either
directors at the beginning of such period or whose election or
nomination for election was previously so approved), cease for any
reason to constitute a majority of our Board of Directors then in
office (excluding from such calculation any election of directors by
holders of the 9% Preferred Stock); or
- the date of the consummation of our merger or consolidation with
another corporation where our stockholders immediately prior to the
merger or consolidation, would not beneficially own immediately after
the merger or consolidation, shares entitling such stockholders to 50%
or more of all votes (without consideration of the rights of any class
of stock to elect directors by a separate class vote) to which all
stockholders of the corporation issuing cash or securities in the
merger or consolidation would be entitled in the election of directors
rectors, or where members of our Board of Directors immediately prior
to the merger or consolidation, would not immediately after the merger
or consolidation, constitute a majority of the board of directors of
the corporation issuing cash or securities in the merger or
consolidation.
As used herein, "Market Price" of a share of the common stock will
be the average of the Closing Prices of the common stock for the ten trading
days ending on the last trading day preceding the date of the Change in Control.
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Registrar and Transfer Agent
Chase Mellon Shareholder Services, L.L.C., is our Registrar and Transfer
Agent for the 9% Preferred Stock as well as our common stock and Class B Stock.
We act as Registrar and Transfer Agent for the 5% Preferred Stock.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be passed
upon for us by Weisman Celler Spett & Modlin, P.C., New York, New York. Howard
S. Modlin, a member of Weisman Celler Spett & Modlin, P.C. is a Director and
Secretary of GDC.
INDEPENDENT ACCOUNTANTS
Our consolidated financial statements as of September 30, l999 and
l998 and for each of the periods in the three year period ended September 30,
l999 incorporated by reference in this prospectus have been audited by
PricewaterhouseCoopers L.L.P., independent accountants, as stated in their
report appearing therein.
INDEMNIFICATION
---------------
Our Charter authorizes the indemnification of directors and officers
and the purchase of insurance on behalf of such persons against liability
asserted against them in such capacity or arising out of such status. We
maintain an insurance policy covering our directors and officers against certain
losses. Section 145 of the General Corporation Law of Delaware permits or
requires indemnification of officers and directors in the event that certain
statutory standards of conduct are met.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers and controlling persons pursuant
to the foregoing provisions, or otherwise, we have been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable.
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FORM S-8
PART II: INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
See Prospectus, "Where You Can Find More Information," page 3
and "Description of Capital Stock," page 7.
Item 4. Description of Securities
Not applicable.
Item 5. Interest of Named Experts and Counsel
The consolidated financial statements as of September 30, 1999
and 1998 and for each of the periods in the three years ended September 30, 1999
incorporated by reference in this Registration Statement, have been audited by
PricewaterhouseCoopers LLP, independent accountants, as stated in their report
therein.
Item 6. Indemnification of Directors and Officers
Reference is made to Article Tenth of the registrant's Restated
Certificate of Incorporation filed as Exhibit 3.l to the Registrant's Quarterly
Report on Form l0-Q for the quarter ended June 30, l999, which is incorporated
by reference for information concerning indemnification of directors and
officers. Section l45 of the General Corporation Law of Delaware permits or
requires indemnification of officers and directors in the event that certain
statutory standards of conduct are met. However, reference is made to Item 9(d)
with respect to indemnification for liabilities arising under the Securities
Act.
Under an insurance policy with The Chubb Group of Companies, the
directors and certain officers of the undersigned registrant and its
subsidiaries are indemnified against certain losses arising from certain claims
which may be made against such persons, by reason of their being such directors
or officers.
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. List of Exhibits
10.1 1998 Stock Option Plan
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10.2 Non-Statutory Stock Option Agreement form - employee
(Incorporated by reference from Exhibit 10.2 to Form S-8,
Registration Statement No. 333-89571.)
10.3 Non-Statutory Stock Option Agreement form -
non-employee directors (Incorporated by reference from
Exhibit 10.3 to Form S-8, Registration Statement No. 333-89571.)
23. Consents
PricewaterhouseCoopers LLP
Item 9. Undertakings
(a) The undersigned registrant hereby undertakes:
(l) 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 l0(a)(3) of the Securities Act of
l933 (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 clauses (i) and (ii) do not apply if the information required to
be included in a post-effective amendment by those clauses is contained in
periodic reports filed by the Registrant pursuant to Section l3 or Section l5(d)
of the Securities Exchange Act of l934 ("Exchange Act") that are incorporated by
reference in this Registration Statement.
(2) 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 herein 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 the
purpose of determining any liability under the Securities Act, each filing of
the registrant's annual report pursuant to Section l3 or l5(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section l5(d) of the Exchange Act) 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.
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(c) The undersigned registrant hereby undertakes to deliver or
cause to be delivered with the Prospectus to each employee to whom the
Prospectus is sent or given, a copy for the registrant's latest annual report to
stockholders that is incorporated by reference in the Prospectus and furnished
pursuant to and meeting the requirements of Rule 14a-3 or Rule 14c-3 under the
Exchange Act, unless such employee otherwise has received a copy of such report
in which case the registrant shall state in the Prospectus that it will promptly
furnish without charge a copy of such report on written request of the employee,
and where interim financial information required to be presented by Article 3 of
Regulation S-X is not set forth in the Prospectus, to deliver the latest
quarterly report that is specifically incorporated by reference in the
Prospectus to provide such financial information.
(d) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the undersigned registrant pursuant to the foregoing provisions, or
otherwise, the undersigned 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 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 undersigned 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
undersigned 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 will be governed by the final
adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of l933, 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 Town of Middlebury, State of Connecticut, on the 20th day of
December, 2000.
GENERAL DATACOMM INDUSTRIES, INC.
By: /s/ CHARLES P. JOHNSON
Charles P. Johnson, Chairman of the Board
Pursuant to the requirements of the Securities Act of l933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ CHARLES P. JOHNSON Chairman of the Board December 20, 2000
Charles P. Johnson and Chief Executive Officer
/s/ WILLIAM G. HENRY Vice President, Finance December 20, 2000
William G. Henry And Chief Financial Officer
/s/ HOWARD S. MODLIN Director December 20, 2000
Howard S. Modlin
/s/ FREDERICK R. CRONIN Director December 20, 2000
Frederick R. Cronin
/s/ LEE M. PASCHALL
Lee M. Paschall Director December 20, 2000
/s/ JOHN L. SEGALL
John L. Segall Director December 20, 2000
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