As filed with the Securities and Exchange Commission on May __, 1999
Registration No. 333- _________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
APPLIED MAGNETICS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 95-1950506
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
-------------------------
75 Robin Hill Road
Goleta, California 93117
(805) 683-5353
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
-------------------------
CRAIG D. CRISMAN
Chief Executive Officer
Applied Magnetics Corporation
75 Robin Hill Road
Goleta, California 93117
(805) 683-5353
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
With a copy to:
JAMES J. SLABY, JR., ESQ.
Sheppard, Mullin, Richter & Hampton LLP
333 South Hope Street, 48th Floor
Los Angeles, California 90071
(213) 620-1780
----------------------------
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If the any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE, AND WE MAY CHANGE IT.
OUR STOCKHOLDERS MAY NOT SELL THESE SHARES UNTIL THE REGISTRATION STATEMENT
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS
IS NOT AN OFFER TO SELL THESE SHARES. IT IS NOT SOLICITING AN OFFER TO BUY THESE
SHARES IN ANY STATE WHERE THEY DO NOT PERMIT THE OFFER OR SALE.
Page 2 of 31
<PAGE>
Subject to Completion, Dated April __, 1999
Prospectus
APPLIED MAGNETICS CORPORATION
18,002,367 Shares Common Stock
This prospectus relates to the public offering of 18,002,367 shares of our
common stock which is held by some of our current stockholders. We will not
receive any of the proceeds of any sales by the selling stockholders.
Our common stock is listed on the New York Stock Exchange under the symbol
"APM." The closing price of the common stock on ___________, 1999 was $____ per
share.
Investing in our common stock involves a high degree of risk. See "Risk Factors"
beginning on page 7 for a discussion of certain factors you should consider
before buying shares of the common stock.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or determined if
this prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
---------------------------
The date of this prospectus is _______, 1999
Page 3 of 31
<PAGE>
PROSPECTUS SUMMARY
You should read the following summary together with the more detailed
information about our company and our consolidated financial statements and the
notes to those statements incorporated by reference in this prospectus.
Applied
We are an independent manufacturer of magnetic recording heads and of head
stack assemblies for disk drives. We manufacture advanced inductive thin film
disk heads and are in the process of qualifying our 4.3 gigabyte
magnetoresistive disk heads, in each case, primarily to supply to manufacturers
of 3.5 inch hard disk drives. Our products compete on the basis of price,
performance, quality and availability. We have also begun development of giant
magnetoresistive disk heads, also intended for computer disk drive applications.
Our principal executive offices are located at 75 Robin Hill Road, Goleta,
California 93117, and our telephone number at that address is (805) 683-5353.
The Offering
Shares Offered 18,002,367 shares of common stock, $.10 par
value.
Plan of Distribution All of the shares of common stock are being
offered by the selling stockholders. The selling
stockholders may offer from time to time some or
all of the shares of common stock held by them
directly or through brokers or dealers. See "Plan
of Distribution".
Shares Outstanding 42,144,043 shares of common
stock as of February 25, 1999.
Proceeds We will not receive any of the proceeds
from the sale of the shares by the
selling stockholders.
NYSE Trading Symbol APM
Risk Factors You should read carefully and
consider the matters discussed under the
heading "Risk Factors" beginning on Page 9.
Page 4 of 31
<PAGE>
Material Developments
Effective February 11, 1999, through an Agreement and Plan of Merger,
dated as of November 24, 1998 and amended and restated as of January 19, 1999,
our wholly owned subsidiary combined with Das Devices, Inc., a Delaware
corporation, in a merger transaction in which DAS became our wholly owned
subsidiary. In connection with the merger:
o We issued or reserved for issuance to the holders of the common stock and
preferred stock of DAS, option holders, warrant holders, employees and
consultants, an aggregate of 13,051,872 shares of our common stock,
constituting approximately 33% of our outstanding common stock after
giving effect to the merger, but excluding the shares of common stock to
be sold to certain investors following the merger, and
o Directors and 5% stockholders of DAS are subject to a provision in the
merger agreement which restricts sales of our securities by DAS affiliates
until the earlier of (a) 60 days after the merger or (b) 48 hours after
one month of combined financial results have been published.
The merger was approved by the DAS stockholders on February 11, 1999. The
number of shares of Applied common stock issued in the merger was determined
through negotiations between our management and DAS management and was approved
by each company's Board of Directors.
Under the terms of a registration rights agreement with DAS, we have
agreed to register the shares for resale under the Securities Act of 1933 within
60 days following the effective time of the merger. We agreed to indemnify each
holder of registered shares for any loss caused by a failure to disclose
information or the disclosure of false information in the registration
statement, as long as the loss is not based upon information provided by such
holder. Each holder of shares included in the registration statement has agreed
to indemnify us, any underwriter and each other holder for any loss caused by a
failure to disclose information or the disclosure of false information in the
registration statement in reliance on information provided to us by such holder.
DAS is primarily engaged in research and development of high technology
advancements in magnetic recording heads for hard disk drives for computer
applications and production methods for these heads. DAS also has limited
manufacturing capability and has begun to manufacture and ship disk drive heads
in limited quantities. DAS is focused on developing products for 1999 and future
periods that are advancements over presently available disk drive head products.
The merger combines DAS' proprietary and patented state-of-the-art wafer
technology with our high volume manufacturing capability. The merger also
increases the ability of the combined company to produce giant magnetoresistive
heads for the marketplace at high areal densities. The merger should also enable
the combined company to compete more effectively against larger competitors by
providing it with a greater ability to develop new products and to accelerate
its time to market performance.
On November 24, 1998, we entered into a Securities Purchase Agreement, as
amended and restated as of January 19, 1999, with Sierra Ventures VI, Watershed
Partners, L.P., Watershed Cayman, L.L.C., Haussman Holdings, East River
Ventures, L.L.C., JAFCO America Ventures, Inc. and The Chase Manhattan Bank as
Trustee for First Plaza Group Trust. On February 11, 1999, pursuant to the
Page 5 of 31
<PAGE>
Securities Purchase Agreement, we sold to the investors 4,950,495 shares of our
common stock in consideration of the payment to us of $18,750,000. Under the
terms of a registration rights agreement with the investors, we have agreed to
register the shares for resale under the Securities Act of 1933, within 60 days
of the date of sale. The registration rights agreement contains indemnities
similar to those in our registration rights agreement with DAS. The registration
rights agreement also contains restrictions on the resale of our securities by
the investors similar to those contained in the merger agreement.
Page 6 of 31
<PAGE>
RISK FACTORS
You should carefully consider the risks described below before investing
in our common stock. The risks described below are not the only risks facing us.
Additional risks and uncertainties that we do not presently know or that we do
not presently believe are important to an investor may also harm us.
If any of the events or conditions described in the following risks
actually occur, our business, financial condition and results of operations
could be seriously harmed. In that case, you may lose all or part of your
investment.
We may not be able to respond to technology transitions which may cause our
products to not be competitive in the industry.
The magnetic recording head industry involves rapidly changing technology,
short product life cycles and intense price competition. Demand for greater data
storage capacity requires disk drive and disk head manufacturers to continue to
build greater performance into their respective products. We cannot assure you
that our products will achieve the performance necessary to remain competitive,
or that we will qualify as a supplier for disk drive manufacturers' programs.
During fiscal 1998, we experienced a rapid technology transition as the
disk drive industry moved from inductive thin film to magnetoresistive disk head
technology. Similarly, DAS abandoned its inductive thin film development program
when the market moved to magnetoresistive technology more quickly than DAS
management expected. As a result of our inability to qualify our
magnetoresistive products on customer programs during fiscal 1998, we faced
reduced customer demand for our products and significant reductions in revenues
and experienced substantial losses. We cannot assure you that we will qualify
for magnetoresistive and giant magnetoresistive disk head manufacturing programs
or that we will not experience manufacturing and product quality problems in the
future.
Our future success depends on our ability to develop and qualify new
products on a timely basis and to manufacture them in sufficient quantities to
compete effectively on the basis of price and performance in customer's disk
drives. We also cannot assure you that changes in technology will not result in
a move away from magnetoresistive and giant magnetoresistive technology to
another technology.
Das technology is unproven and may not meet expectations which may cause us to
spend additional research and development funds and cause us to lose customer
contacts.
DAS' giant magnetoresistive technology and production advancements have
been recently developed and are unproven. The DAS giant magnetoresistive
technology may not meet expectations as to performance, durability or
reliability or may otherwise fail to produce intended improvements over existing
technologies. Although DAS technology has achieved favorable performance in
testing, we cannot assure you that we will achieve these results in large-scale
production. If favorable results are not achieved in large scale production, or
the DAS technology fails to obtain expected results, we may be required to spend
additional research and development funds to resolve problems or develop
alternative solutions. In that event, we may lose the opportunity to bid for and
receive additional customer contracts, and that may seriously harm our business,
financial condition and results of operations.
Page 7 of 31
<PAGE>
Amortization of goodwill and merger expenses will delay or reduce our
profitability.
Amortization of merger expenses will reduce our profitability. The merger
with DAS is being accounted for as a purchase, with the purchase price allocated
to the acquired assets and liabilities of DAS. An in-process research and
development charge, estimated to be approximately $28.7 million, will be
recorded in the second quarter of fiscal 1999, the quarter during which the
merger was completed. Intangible assets are comprised of developed technology
and know-how of approximately $30.1 million and goodwill of approximately $12.2
million. The developed technology and know-how will be amortized as an expense
over three years, and the goodwill will be amortized as an expense over seven
years.
We also anticipate that costs associated with the merger will negatively
affect results of operations in the second quarter of fiscal 1999. We estimate
that the combined company will incur approximately $3.5 million of expenses,
primarily relating to costs associated with combining the operations of the two
companies and the fees of financial advisors, attorneys and accountants.
Although we do not believe that the costs will significantly exceed this amount,
we cannot assure you that this estimate is correct or that unanticipated
expenses, including research and development costs, will not substantially
increase the costs of the merger.
Integrating business operations may prove difficult or divert management
attention from our business which may cause short-term harm to operating
results.
The merger involves the integration of the operations and systems of the
two companies and the realization of potential operating synergies may prove
difficult. Management's attention may be diverted from other business concerns
to address integration issues. These and other difficulties, including
challenges related to assimilating and retaining personnel, associated with the
merger may lead to potential short-term harm to operating results.
Our quarterly and annual operating results may fluctuate due to product cycles.
Our operating results have fluctuated and may continue to fluctuate from
quarter to quarter and year to year. Our sales are generally made pursuant to
individual purchase orders and customer-specific materials are ordered on the
basis of these purchase orders. As customer programs reach the end of their life
cycle, we may have to write-down inventory and equipment. We must qualify on
future programs to sell our products. We experienced substantial losses and
cancellation, rescheduling and reduction of orders
in fiscal 1998. Cancellations, rescheduling and reductions of orders result in
inventory losses, under-utilization of production capacity and write downs of
tooling and equipment which may seriously harm our business, financial condition
and results of operations. Our operating results have in the past been and our
operating results likely will in the future be harmed during periods when
production capacity is underutilized.
We are exposed to cycles in the disk drive industry causing periods of over
supply, reduced production levels, reduced demand and intense competitive
pricing.
The disk drive industry is very cyclical and historically has experienced
periods of oversupply and reduced production levels, resulting in significantly
Page 8 of 31
<PAGE>
reduced demand for disk heads, as well as intensely competitive pricing. The
effect of these cycles on suppliers, including us, has been magnified by hard
disk drive manufacturers' practice of ordering recording heads in excess of
their needs during periods of rapid growth, which increases the severity of the
drop in the demand for recording heads during periods of slower growth or
contraction. An oversupply of hard disk drives occurred in early 1998 and, as a
result, head suppliers, including us, experienced intense pricing pressure on
their inductive thin film and magnetoresistive head products. A continued
decline in demand for hard disk drives, as experienced by the industry during
fiscal 1998, has seriously harmed our business, financial condition and results
of operations. A continued decline in demand for older products and the failure
to bring new products to the market would seriously harm our future business,
financial condition and results of operations.
We have significant capital needs which if not available will harm our business.
The recording disk head industry involves significant capital investment.
Substantial expenditures are necessary for research and development in order to
obtain technological improvements and develop new technologies such as
magnetoresistive and giant magnetoresistive disk head products. We believe that,
in order to achieve our objectives, we will need significant additional
resources over the next several years for capital expenditures, working capital
and research and development. We cannot assure you that such additional funds
will be available to us or, if available, upon terms and conditions acceptable
to us. During fiscal 1999, we plan to purchase or enter into lease financing for
approximately $45 million of manufacturing equipment and facility improvements.
We believe that we will be able to fund future expenditures from a combination
of existing cash balances, sale of common stock, cash flow from operations,
equipment lease financing arrangements and existing credit facilities. We may,
however, need additional sources of capital to meet our financing requirements.
If we are unable to obtain sufficient capital, we will need to curtail our
operating and capital expenditures, which could seriously harm our future
business, financial condition and results of operations.
We must service short-term borrowings and some of our loans are callable.
At February 22, 1999, we had approximately $60.2 million of short-term
borrowings outstanding in variable interest rate demand loans from banks in
Malaysia, where we have substantial manufacturing operations. The loans are
callable on demand and have no termination date. The loans are used for the
purchase of manufacturing equipment and for working capital purposes. While we
have no reason to believe the loans will be called, we cannot assure you that
the banks will continue to make such loans available. We have several
significant lease obligations and bank loans which are payable on a monthly
basis. We cannot assure you that we will continue to meet these obligations when
they come due. If we do not, the lenders could enforce penalties, reclaim
equipment or intellectual property, or otherwise seriously harm our business,
financial condition and results of operations.
Our revenues come primarily from a few customers.
We have depended on two customers for most of our recent sales. We cannot
assure you that these customers will continue to purchase from us or that we
will be successful in obtaining new customers.
Page 9 of 31
<PAGE>
The disk head industry is intensely competitive and largely dependent on
sales to a limited number of major disk drive manufacturers. Western Digital
accounted for 72% of our net sales in fiscal 1998; Samsung Electronics accounted
for 27% of our net sales during fiscal 1998.
On April 30, 1998, Western Digital and IBM entered into a letter of
intent. IBM plans to supply Western Digital with giant magnetoresistive heads
and other components and technology for desktop hard drives. Western Digital
expects to introduce hard drives based on IBM products and designs in the first
half of calendar year 1999. However, the agreement does not preclude other head
suppliers, such as us, from competing on future non-IBM desktop programs at
Western Digital. We cannot assure you, however, that we will be able to
successfully bid for and receive purchase orders for these programs in the
future.
Our ability to obtain new customers depends on whether we can:
o Achieve delivery of products that meet customer specifications at
competitive prices.
o Anticipate technological changes and meet development requirements
in a timely fashion.
o Develop products to meet individualized customer requirements.
Our business, financial condition and results of operations will be
seriously harmed if:
o We are unable to attract new customers.
o If vertically integrated manufacturers do not continue to purchase
hard drive components from third parties like us.
o Non-integrated disk drive manufacturers begin to develop component
manufacturing ability.
o Hard drive manufacturers enter into exclusive strategic arrangements
with component manufacturers.
We face intense competition and may not be able to remain competitive with our
competitors.
We face intense competition for our hard drive components. We cannot
assure you that we will continue to develop technology or sales and
manufacturing capabilities to compete effectively with our competitors.
We compete with other independent recording head suppliers, as well as
disk drive manufacturers that produce magnetic recording heads used in their own
products. Read-Rite Corporation has been the largest domestic competitor among
independent magnetoresistive disk head manufacturers and has had substantially
greater sales of magnetoresistive disk head products than us.
Currently, several large Japanese companies, some with considerably more
resources than us, compete in the independent head market and have had
considerable success in gaining market share. Alps Electric Corporation, TDK
Corporation (and its SAE Magnetics subsidiary) and Yamaha Corporation continue
to aggressively develop and market recording heads.
Page 10 of 31
<PAGE>
Other independent recording head manufacturers that are shipping, or
intend to ship, to the original equipment manufacturer marketplace include
Headway Technologies, Inc., Silmag, Kaifa Technology, Inc.
and Hitachi Metals Ltd.
Disk manufacturers such as Fujitsu, Hitachi, IBM, and Seagate Technology
produce some or all of their own inductive thin film, magnetoresistive and giant
magnetoresistive heads they use. All of these companies have significantly
greater financial, technical and marketing resources than us. IBM also makes its
recording head products available in the original equipment manufacturer market
to competing drive manufacturers.
We depend on foreign operations which are subject to labor disruption, civil
unrest and political instability.
We conduct our head production, assembly and test operations in our
facilities in Korea, Malaysia and China. Further, independent contractors
conduct manufacturing and assembly operations for us in Malaysia and China. Our
operations in Korea have, from time to time in recent years, been affected by
labor disruptions and may face potential labor shortages in the future, as other
disk drive and component manufacturers expand their production facilities in
Malaysia. In addition to risks of labor disruption, civil unrest and political
instability, our foreign operations may be subject to:
o Delays in obtaining governmental permits and approvals.
o Currency exchange fluctuations.
o Currency and trade restrictions.
o Transportation problems.
Our stock price has varied greatly and may continue to fluctuate which may
reduce our ability to raise additional operating funds.
The market price of our common stock has been volatile, with closing
market prices ranging from $4.00 to $33.25 per share during fiscal 1998 and from
$3.38 to $9.19 per share during the first five months of fiscal 1999. The
volatility of our stock price may reduce our ability to raise additional
operating funds. Our stock price may fluctuate in the future due to a number of
factors, including:
o Quarter-to-quarter operating results.
o Market assessments of proposed and completed strategic
transactions, including the merger.
o Disk drive and computer industry conditions.
o Awards of product qualifications and customer orders to competitors.
o Changes in prices of our products or the products sold by our
competitors.
o New product or product development announcements by us or our
competitors.
o General market and economic conditions.
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<PAGE>
The volatility of the stock markets in recent years has caused wide fluctuations
in trading prices of stocks of technology companies independent of their
individual operating results. The market price of our common stock at any given
time may be reduced by factors independent of our operating results.
We may not be ready for year 2000 computer issues which may cause significant
expenses.
The "Year 2000" issue exists because the date codes used in some computer
hardware and software systems use only two digits and are therefore unable to
distinguish between the years 1900 and 2000. Although we have partially
completed an investigation of our year 2000 exposure and we are in the process
of transferring DAS systems over to our systems, we cannot assure you that we
are ready for year 2000. Although we believe we will not incur significant
expenses relating to year 2000 readiness, we are continuing to evaluate our
information technology and product infrastructures for year 2000 compliance. Any
unresolved or undetected year 2000 compliance problems could seriously harm our
business, financial condition and results of operations.
Our effort to address year 2000 issues began in 1997. In fiscal 1998, we
spent $7.5 million to complete the implementation of a worldwide management
information system that addresses the year 2000 issue and also provides fully
integrated manufacturing and financial capabilities. In addressing year 2000
issues, we have employed a five-step process consisting of:
o Conducting a company-wide inventory.
o Assessing year 2000 compliance, including communication with our
customers and suppliers to determine their year 2000 efforts.
o Remediating non-compliant hardware and software.
o Testing remediation hardware and software.
o Certifying year 2000 compliance.
Inventory and assessment activities are estimated to be approximately 75%
complete. Overall remediation efforts are estimated to be approximately 50%
complete. Much of the cost for year 2000 efforts is being accounted for as part
of normal operating budgets.
Shares eligible for future sale may adversely affect market price of our common
stock making it more difficult to sell our securities in the future.
If our stockholders sell substantial amounts of our common stock in
the public market, the market price of our common stock could fall. These sales
also might make it more difficult to sell equity or equity-related securities in
the future at a time and at a price we deem appropriate. The Company currently
has outstanding:
o 7% Convertible Subordinated Debentures due 2006 which are convertible into
6,200,000 shares of the Applied Common Stock.
o Warrants to purchase 1,200,000 shares of the Applied Common Stock.
o 837,868 shares available for issuance pursuant to various stock option
plans.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other
information with the Securities and Exchange Commission. You may read and copy
any document that we file at the SEC's public reference room at Judiciary Plaza,
450 Fifth Street, N.W. Washington, D.C. 20549 and at the following regional
offices of the SEC: Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661 and 7 World Trade Center, Suite 1300, New York, New York
10048. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference room. Our SEC filings are also available to the public at the
SEC's Internet site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information that we file
with the SEC will automatically update and replace this information. We
incorporate by reference the documents listed below and any future filings made
with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until the selling stockholders sell all of the common
stock.
o Annual Report on Form 10-K for the fiscal year ended October 3, 1998
and Annual Report on Form 10-K/A for the fiscal year ended
October 3, 1998;
o Quarterly Reports on Form 10-Q for the fiscal quarter ended
January 2, 1999 and April 3, 1999; and
o Current Reports on Form 8-K dated October 28, November 24, 1998
February 12, 1999, March 26, 1999, Current Report on Form 8-K/A
dated March 5, 1999 and Current Report on Form 8-K/A dated May __,
1999.
This prospectus is part of a registration statement we filed with the SEC.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Applied Magnetics Corporations
75 Robin Hill Road
Goleta, California 93117
Attention: Peter T. Altavilla, Corporate Secretary
Telephone: (805) 683-5353
You should rely only on the information incorporated by reference or
provided in this prospectus or any supplement. We have not authorized anyone
else to provide you with different information. We are not making an offer of
the common stock in any state where the offer is not permitted. You should not
assume that the information in this prospectus or any supplement is accurate as
of any date other than the date on the front of this prospectus.
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SELLING STOCKHOLDERS
The following table provides information as to the shares of common stock
owned beneficially by the selling stockholders as of February 25, 1999, the
number of shares to be sold by the selling stockholders and the number of shares
which will be owned by the selling stockholders after the offering.
<TABLE>
<CAPTION>
NUMBER OF SHARES
SHARES TO BE BENEFICIALLY
NAME OF SELLING NUMBER OF BENEFICIALLY OFFERED FOR OWNED AFTER
STOCKHOLDER (1) OWNED PRIOR TO OFFERING (2) RESALE OFFERING (2)
--------------- --------------------------- ------ ------------
NUMBER PERCENT
------ -------
<S> <C> <C> <C> <C>
Cassin, Brendan Joseph and Isabel B., 186,872 * 186,872 0
Trustees of the Cassin Family Trust
U/D/T dated January 31, 1996 (5)
Donald L. Lucas Profit Sharing Trust 65,815 * 65,815 0
DTD 1-1-84 (5)
Lucas, Richard M. Cancer Foundation 52,619 * 52,619 0
(5)
Donald L. Lucas, Trustee, Donald L. 13,196 * 13,196 0
Lucas and Lygia S. Lucas Trust DTD
12/3/84 (5)
Viko Technology, Inc. (5) 35,189 * 35,189 0
Patel, Pinakin R., Trustee of the 17,594 * 17,594 0
Pinakin R. and Kalpana P. Patel Trust,
January 13, 1986 (5)
Kitrosser, Steven P. (5) 4,486 * 4,486 0
Teal, Robert G. (5) 5,383 * 5,383 0
Davis, Joseph (5) 1,759 * 1,759 0
Frontline Partners, L.P. (5) 175,948 * 175,948 0
Comdisco (5) 33,824 * 33,824 0
Venture Lending & Leasing Inc. (5) 12,725 * 12,725 0
Victory Ventures LLC (5) 323,407 * 323,407 0
Jacobson, Crystalynn (5) 29 * 29 0
Raza, S. Atiq (5) 52,756 * 52,756 0
Equities Holdings LLC (5) 26,199 * 26,199 0
Sierra Ventures VI (4) (5) 1,747,818 4.15% 1,747,818 0
SV Associates VI (5) 167,233 * 167,233 0
AK Investments, Inc. (5) 351,920 * 351,920 0
RWI Group II, L.P. (5) 213,862 * 213,862 0
Page 14 of 31
<PAGE>
NUMBER OF SHARES
SHARES TO BE BENEFICIALLY
NAME OF SELLING NUMBER OF BENEFICIALLY OFFERED FOR OWNED AFTER
STOCKHOLDER (1) OWNED PRIOR TO OFFERING (2) RESALE OFFERING (2)
--------------- --------------------------- ------ ------------
NUMBER PERCENT
------ -------
CitiCorp (5) 958,279 2.27% 958,279 0
Das, Shyam C. (5) 95 * 95 0
Northlea Partners, Ltd. (5) 3,985 * 3,985 0
Levy, Leonard, Smith Barney, Inc. (5) 1,112 * 1,112 0
Custodian FBO (5)
Goel, Prabhaker as Custodian for 17,596 * 17,596 0
Prakrati Goel (5)
Goel Foundation (5) 17,596 * 17,596 0
Adkisson, James (5) 4,399 * 4,399 0
Enguehard, Barre (5) 8,798 * 8,798 0
East River Ventures, L.P. (4) (5) 950,930 2.26% 950,930 0
Chisholm Private Capital Partners, L.P. 485,294 1.15% 485,294 0
(5)
Popular Profile Sdn. Bhd. (5) 175,960 * 175,960 0
Carozza, Anna and Dary (5) 1,935 * 1,935 0
Dewis, Joan (5) 2,551 * 2,551 0
Vitiello, Salvatore J. (5) 2,199 * 2,199 0
Lautman, William (5) 17,595 * 17,595 0
Lindgren, Alicia B. (5) 4,231 * 4,2231 0
DeMarco, Christopher (5) 2,639 * 2,639 0
Petillo, John (5) 8,798 * 8,798 0
M3 Partners, L.C. (5) 70,384 * 70,384 0
Newman, Harold J., Newberger & 35,192 * 35,192 0
Berman, LLC, Custodian FBO, IRA
Rollover (5)
Newman Harold J. (5) 52,788 * 52,788 0
M3 Partners L.C. (5) 4,961 * 4,961 0
Bailey, Clarke H. (5) 3,416 * 3,416 0
Egan, Robert L. (5) 3,416 * 3,416 0
Rawn, Stanley R. (5) 3,416 * 3,416 0
Hackett, Melinda, Trust FBO (5) 1,240 * 1,240 0
Pascal, Donald T. (5) 5,639 * 5,639 0
Page 15 of 31
<PAGE>
NUMBER OF SHARES
SHARES TO BE BENEFICIALLY
NAME OF SELLING NUMBER OF BENEFICIALLY OFFERED FOR OWNED AFTER
STOCKHOLDER (1) OWNED PRIOR TO OFFERING (2) RESALE OFFERING (2)
--------------- --------------------------- ------ ------------
NUMBER PERCENT
------ -------
Lowenberg, Jonathan M. (5) 496 * 496 0
Doykos, James (5) 496 * 496 0
Chorske, Michael W. (5) 496 * 496 0
Hackett, Montague III, Trust FBO (5) 1,240 * 1,240 0
Rubin, Donald (5) 6,269 * 6,269 0
Martin, Neil P. (5) 1,759 * 1,759 0
Martin, Herbert J. (5) 17,596 * 17,596 0
Lehman Brothers MBG Venture 15,234 * 15,234 0
Capital Partners 1997 L.P. (5)
LBI Group Inc. (5) 232,422 * 232,422 0
Walter A. Carozza (5) 3,519 * 3,519 0
Aragon Fondkommission AB (5) 175,963 * 175,963 0
Brewin Nominees Limited (5) 7,037 * 7,037 0
Gerlach & Co (5) 43,999 * 43,999 0
Banque Edouard Constant SA (5) 52,788 * 52,788 0
Task Holdings Limited (5) 175,963 * 175,963 0
Zaccaria, Bert L. (5) 204,761 * 204,761 0
DAHLM Partners (5) 21,995 * 21,995 0
English, Robert D. (5) 17,595 * 17,595 0
Hart, Larry (5) 924 * 924 0
KTS Partners LLC (5) 351,926 * 351,926 0
Lockwood, Christopher J. (5) 17,595 * 17,595 0
Price, D. Miles (5) 17,595 * 17,595 0
Strauss, Peter (5) 26,394 * 26,394 0
Whittier Ventures LLC (5) 175,963 * 175,963 0
Berlin, Howard R. (5) 35,192 * 35,192 0
Paduano, Daniel P. (5) 35,192 * 35,192 0
JAFCO Co., Ltd. (5) 175,963 * 175,963 0
JAFCO R-3 Investment Enterprise 120,523 * 120,523 0
Partnership (5)
Page 16 of 31
<PAGE>
NUMBER OF SHARES
SHARES TO BE BENEFICIALLY
NAME OF SELLING NUMBER OF BENEFICIALLY OFFERED FOR OWNED AFTER
STOCKHOLDER (1) OWNED PRIOR TO OFFERING (2) RESALE OFFERING (2)
--------------- --------------------------- ------ ------------
NUMBER PERCENT
------ -------
JAFCO JS-3 Investment Enterprise 72,313 * 72,313 0
Partnership (5)
JAFCO G-6(A) Investment Enterprise 108,470 * 108,470 0
Partnership (5)
JAFCO G-6(B) Investment Enterprise 108,470 * 108,470 0
Partnership (5)
JAFCO G-7(A) Investment Enterprise 147,038 * 147,038 0
Partnership (5)
JAFCO G-7(B) Investment Enterprise 147,038 * 147,038 0
Partnership (5)
U.S. Information Technology No. 2 527,890 * 527,890 0
Investment Enterprise Partnership (5)
Flinn, Lawrence Jr. (5) 175,963 * 175,963 0
Yorkton Securities Inc. in trust for 68,625 * 68,625 0
Valeo Limited (5)
Falore, David J. (5) 1,759 * 1,759 0
Falore, Joseph M. (5) 1,759 * 1,759 0
Schaltz, Gerald and Sharon A., Trustees 1,759 * 1,759 0
Shaltz Family Trust, DTD 1/12/98 (5)
Rush & Co. (5) 19,356 * 19,356 0
Lehman Brothers MBG Ventures 577 * 577 0
Capital Partners 1998 (A) L.P. (5)
Lehman Brothers MBG Ventures 10 * 10 0
Capital Partners 1998 (B) L.P. (5)
Lehman Brothers MBG Venture 65 65 0
Capital Partners 1998 (C) L.P. (5)
M.I.S. VC Partners, L.P. (5) 615,870 1.46% 615,870 0
Watershed Partners, L.P. (4) 299,505 * 299,505 0
Watershed Cayman, Ltd. (4) 299,505 * 299,505 0
JAFCO America Ventures, Inc. (4) 955,445 2.27% 955,445 0
The Chase Manhattan Bank, as Trustee 4,900,989 11.63% 4,900,939 0
for First Plaza Group Trust (3) (4)
Mitchel G. Underseth (5) 69,307 * 74,257 0
ORYX Technology Corp. (5) 54,455 * 54,455 0
- ---------------
<FN>
(1) Mr. Zaccaria became a member of our Board of Directors on February 26,
1999.
(2) The calculation of shares of common stock beneficially owned was
determined in accordance with Rule 13d-3 of the Exchange Act.
Page 17 of 31
<PAGE>
(3) The Chase Manhattan Bank acts as the Trustee for the First Plaza
Group Trust a trust under and for the benefit of certain employee
benefit plans of General Motors Corporation and its subsidiaries.
The address of Trust is c/o The Chase Manhattan Bank, as Trustee for
First Plaza Group Trust, 4 Chase Metrotech Center, Brooklyn, New
York 11245. These shares may be considered to be owned beneficially
by General Motors Investment Management Corporation a wholly owned
subsidiary of General Motors Corporation. General Motors Investment
Management Corporation's principal business is providing investment
advice and investment management services with respect to the assets
of certain employee benefit plans of General Motors Corporation and
its subsidiaries and with respect to the assets of certain direct
and indirect subsidiaries of General Motors Corporation and
associated entities. General Motors Investment Management
Corporation is serving as the Trust's Investment manager with
respect to these shares and in that capacity has sole power to
direct the Trustee as to the voting and disposition of these shares.
Because of the Trustee's limited role, beneficial ownership of these
shares by the Trustee is disclaimed. The address of General Motors
Investment Management Corporation is 767 Fifth Avenue, New York, New
York 10153.
(4) Indicates the selling shareholder received its shares in the DAS
merger.
(5) Indicates the selling shareholder purchased its shares under the
Securities Purchase Agreement.
</FN>
</TABLE>
Our registration of the shares included in this prospectus does not
necessarily mean that the selling stockholders will decide to sell any of the
shares offered by this prospectus. The shares covered by this prospectus may be
sold from time to time by the selling stockholders so long as this prospectus
remains in effect; provided, however, that the selling stockholders are first
required to contact us to confirm that this prospectus is in effect.
DESCRIPTION OF COMMON STOCK
Each holder of our common stock is entitled to one vote per share held of
record on each matter submitted to stockholders. Cumulative voting for the
election of directors is not permitted, and the holders of a majority of shares
voting for the election of directors can elect all members of the Board of
Directors.
Holders of record of shares of our common stock are entitled to receive
ratably dividends when and if declared by the Board of Directors out of funds of
legally available for dividends. In the event of a voluntary or involuntary
winding up or dissolution, liquidation or partial liquidation, holders of the
common stock are entitled to participate ratably in any distribution of the
assets of our company.
Holders of the common stock have no conversion, redemption or preemptive
rights. All outstanding shares of the common stock are validly issued, fully
paid and nonassessable.
Page 18 of 31
<PAGE>
PLAN OF DISTRIBUTION
Neither we nor the selling stockholders have employed an underwriter for
the sale of common stock by the selling stockholders. We will pay all expenses,
other than broker or dealer discounts and commissions, stock transfer taxes and
the fees and disbursements of separate counsel, if any, retained by the
shareholders, associated with the sale of the common stock. The securities
covered by this prospectus may be sold by or for the account of the selling
stockholders pursuant to this prospectus or pursuant to Rule 144 under the
Securities Act.
The selling stockholders may offer their shares of common stock directly
or through pledgees, donees, transferees or other successors in interest at
various times in one or more of the following transactions, which may include
block sales:
o On any stock exchange on which the shares of common stock may be
listed at the time of sale, either through a broker or otherwise;
o In negotiated transactions;
o In the over-the-counter market;
o In a combination of any of the above transactions; or
o Through any other available market transaction.
The selling stockholders may offer their shares of common stock at any of
the following prices:
o Fixed prices which may be changed;
o Market prices prevailing at the time of sale;
o Prices related to such prevailing market prices; or
o At negotiated prices.
If required by law, we will add a supplement to this prospectus to
disclose the specific shares to be sold, the names of the selling stockholders,
the public offering prices of the shares to be sold, the names of any broker or
dealer employed by the selling stockholders in connection with such sale, and
any applicable commission or discount with respect to a particular offer.
The selling stockholders may effect such transactions by selling shares to
or through broker-dealers, and all such broker-dealers may receive compensation
in the form of discounts, concessions, or commissions from the selling
stockholders and/or the purchasers of shares of common stock for whom such
broker-dealers may act as agents or to whom they sell as principals, or both.
Any broker-dealer acquiring common stock from the selling stockholders may
sell the shares either directly, in its normal market-making activities, through
or to other brokers on a principal or agency basis or to its customers. Any such
sales may be at prices then prevailing on the New York Stock Exchange or at
prices related to such prevailing market prices or at negotiated prices to its
customers or a combination of such methods. The selling stockholders and any
Page 19 of 31
<PAGE>
broker-dealers that act in connection with the sale of the common stock might be
deemed to be "underwriters" pursuant to Section 2(11) of the Securities Act; any
commissions received by them and any profit on the resale of shares as
principals might be deemed to be underwriting discounts and commissions under
the Securities Act of 1933. Any such commissions, as well as other expenses
incurred by the selling stockholders and applicable transfer taxes, are payable
by the selling stockholders. In addition, the selling stockholders may be
subject to applicable provisions of Regulation M under the Exchange Act of 1934,
which may limit the timing of the purchases and sales of shares of common stock
by the selling stockholders.
We have not registered or qualified offers and sales of shares of the
common stock under the laws of any country, other than the United States. To
comply with certain states' securities laws, if applicable, the selling
stockholders will offer and sell their shares of common stock in those
jurisdictions only through registered or licensed brokers or dealers. In
addition, in certain states the selling stockholders may not offer or sell
shares of common stock unless we have registered or qualified the shares for
sale in such states or we have complied with an available exemption from
registration or qualification.
LEGAL MATTERS
The validity of the shares of common stock has been passed upon for us by
Sheppard, Mullin, Richter & Hampton LLP, Los Angeles, California.
EXPERTS
The audited consolidated financial statements and schedules of Applied
included or incorporated by reference in this prospectus and elsewhere in the
registration statement have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their reports with respect to such audited
consolidated financial statements and schedules, and are included in this
prospectus in reliance upon their authority as experts in giving the indicated
reports.
The audited financial statements of DAS included or incorporated by
reference in this prospectus and elsewhere in the registration statement have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their reports with respect to such audited financial statements,
and are included in this prospectus in reliance upon their authority as experts
in giving the indicated reports.
No 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. If given or made, you must not
rely on such information or representations.
You should not consider that the delivery of
this prospectus or any sale made hereunder APPLIED MAGNETICS CORPORATION
under any circumstances creates any implication
that there has been no change in us or in our
business, operations or financial condition
since the date of this prospectus. This
prospectus does not constitute an offer or
solicitation by anyone in any jurisdiction in
which such offer or solicitation is not 18,002,367 shares of
qualified to do so or to anyone to whom it is common stock
unlawful to make such solicitation.
Page 20 of 31
<PAGE>
Table of Contents
Prospectus Summary.....................4
Risk Factors...........................7
Where You Can Find More Information...13
Selling Stockholders..................14 Prospectus
Description of Common Stock...........18 _______, 1999
Plan of Distribution..................19
Legal Matters.........................20
Experts...............................20
Page 21 of 31
<PAGE>
Part II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the various expenses in connection with the
sale and distribution of the securities being registered, other than
underwriting discounts and commissions. All of the amounts shown are estimates,
except the Securities and Exchange Commission registration fee and the listing
fee.
Securities and Exchange Commission
registration fee................ $15,518*
Printing and engraving expenses...... 2,000*
Accounting fees and expenses......... 7,500*
Legal fees and expenses.............. 15,000*
Miscellaneous expenses............... 1,000*
Total.......................... $41,018
*Estimate
Item 15. Indemnification of Directors and Officers
The indemnification of officers and directors of the Registrant is
governed by Section 145 of the General Corporation Law of the State of Delaware
(the "DGCL") and the Certificate of Incorporation and By-Laws of the Registrant.
Subsection (a) of DGCL Section 145 empowers a corporation to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the corporation) by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by the person in connection with
such action, suit or proceeding if the person acted in good faith and in a
manner the person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe the person's conduct was
unlawful.
Subsection (b) of DGCL Section 145 empowers a corporation to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that the
person is or was a director, officer, employee or agent of the corporation, or
II-1
Page 22 of 31
<PAGE>
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by the person in connection with the defense or settlement
of such action or suit if the person acted in good faith and in a manner the
person reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Delaware Court
of Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Court of Chancery or such
other court shall deem proper.
DGCL Section 145 further provides that to the extent that a present or
former director or officer is successful, on the merits or otherwise, in the
defense of any action, suit or proceeding referred to in subsections (a) and (b)
of Section 145, or in defense of any claim, issue or matter therein, such person
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection therewith. In all cases in
which indemnification is permitted under subsections (a) and (b) of Section 145
(unless ordered by a court), it shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of the
present or former director, officer, employee or agent is proper in the
circumstances because the applicable standard of conduct has been met by the
party to be indemnified. Such determination must be made, with respect to a
person who is a director or officer at the time of such determination, (1) by a
majority vote of the directors who are not parties to such action, suit or
proceeding, even though less than a quorum, or (2) by a committee of such
directors designated by majority vote of such directors, even though less than a
quorum, or (3) if there are no such directors, or if such directors so direct,
by independent legal counsel in a written opinion, or (4) by the stockholders.
The statute authorizes the corporation to pay expenses incurred by an officer or
director in advance of the final disposition of a proceeding upon receipt of an
undertaking by or on behalf of the person to whom the advance will be made, to
repay the advances if it shall ultimately be determined that he was not entitled
to indemnification. DGCL Section 145 also provides that indemnification and
advancement of expenses permitted thereunder are not to be exclusive of any
other rights to which those seeking indemnification or advancement of expenses
may be entitled under any By-law, agreement, vote of stockholders or
disinterested directors, or otherwise. DGCL Section 145 also authorizes the
corporation to purchase and maintain liability insurance on behalf of its
directors, officers, employees and agents regardless of whether the corporation
would have the statutory power to indemnify such persons against the liabilities
insured.
The Certificate of Incorporation of the Registrant (the "Certificate")
provides that no director of the Registrant shall be personally liable to the
Registrant or its stockholders for monetary damages for breach of fiduciary duty
as a director except for liability (i) for any breach of the director's duty of
loyalty to the Registrant or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) for paying a dividend or approving a stock repurchase in violation of
Section 174 of the DGCL or (iv) for any transaction from which the director
derived an improper personal benefit.
II-2
Page 23 of 31
<PAGE>
The Registrant's By-laws provide that the Registrant shall indemnify an
officer or director for any costs incurred by such officer or director in
connection with a proceeding against such officer or director by reason of the
fact that he is or was an officer or director of the Registrant, unless such
indemnification is prohibited under applicable law. Pursuant to the By-laws, the
Registrant may also be required to advance funds to an officer or director who
is entitled to indemnification upon receipt of an undertaking by or on behalf of
the officer or director to repay the amount if it is ultimately determined that
such person is not entitled to indemnification. The By-laws further provide that
the Registrant may provide indemnification or the advancement of expenses to any
other person as permitted by applicable law. Such By-law provisions are intended
to be broader than the statutory indemnification provided in the DGCL. However,
the extent to which such broader indemnification may be permissible under
Delaware law has not been established.
The Registrant maintains a directors and officers liability policy. The
policy's coverage, among other things, (i) provides for payment on behalf of the
Registrant's officers and directors against loss (as defined in the policy)
stemming from acts committed by directors and officers in their capacities as
such, with no annual individual deductible element per director or officer, and
(ii) provides for reimbursement of the Registrant against such loss for which
the Registrant grants indemnification to any director or officer, as permitted
by law.
Item 16. EXHIBITS
5.1 Opinion of Sheppard, Mullin, Richter & Hampton LLP
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Arthur Andersen LLP
23.3 Consent of Sheppard, Mullin, Richter & Hampton LLP (included in
Exhibit 5.1)
24.1 Power of Attorney of certain officers and directors (included on page S-1)
Item 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration Statement:
a. To include any prospectus required by Section 10(a)(3) of the
Securities Act;
b. To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registrant
Statement;
c. To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
II-3
Page 24 of 31
<PAGE>
Provided, however, that paragraphs (1)(a) and (1)(b) do not apply if the
Registration Statement is on Form S-3, or Form S-8, and the information required
to be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the Registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the Registration Statement.
2. That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
3. To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 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.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
The undersigned Registrant hereby undertakes that:
1. For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of Prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a form
of Prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
2. For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of Prospectus
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.
II-4
Page 25 of 31
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Goleta, State of California, on May 18, 1999.
APPLIED MAGNETICS CORPORATION
By Craig D. Crisman
-------------------------------
Craig D. Crisman
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Craig D. Crisman and Jerry Goldress, and each of
them, his attorneys-in-fact, each with the power of substitution, for him in any
and all capacities, to sign any amendments to this registration statement and to
file the same, with exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature Date
Craig D. Crisman May 18, 1999
- --------------------------------
Craig D. Crisman, Chairman of the Board
and Chief Executive Officer
(principal executive officer, principal
financial officer)
Peter T. Altavilla May 18, 1999
- --------------------------------
Peter T. Altavilla, Secretary and
Controller (principal accounting officer)
Herbert Dwight, Jr.* May 18, 1999
- --------------------------------
Herbert Dwight, Jr., Director
S-1
Page 26 of 31
<PAGE>
Harold Frank* May 18, 1999
- --------------------------------
Harold Frank, Director
Jerry Goldress* May 18, 1999
- --------------------------------
Jerry Goldress, Director
R. C. Mercure* May 18, 1999
- --------------------------------
R. C. Mercure, Director
Craig D. Crisman
*By: ---------------------------------
Craig D. Crisman
Attorney-In-Fact
S-2
Page 27 of 31
<PAGE>
EXHIBIT 5.1
[On SMR&H Letterhead]
May 18, 1999
Applied Magnetics Corporation
75 Robin Hill Road
Goleta, California 93117
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
As special counsel for Applied Magnetics Corporation, a Delaware
corporation ("AMC"), in connection with AMC's Registration Statement on Form
S-3, No. 333-_____ (the "Registration Statement"), registering a maximum of
18,002,367 shares of AMC's Common Stock, $0.10 par value (the "Shares"), to be
sold on behalf of certain holders thereof (the "Offering"), we have been
requested to render this opinion.
For the purpose of rendering the opinion set forth herein, we have
been furnished with and examined only the following documents:
1. The Certificate of Incorporation of AMC, certified by the
Delaware Secretary of State as of February 5, 1999;
2. The Bylaws of AMC, certified by the Secretary of AMC;
3. The Registration Statement; and
4. Records of the meetings of the Board of Directors of AMC
pertaining to the Offering.
Page 28 of 31
<PAGE>
Applied Magnetics Corporation
May 18, 1999
Page 2
With respect to all of the foregoing documents, we have assumed,
without investigation, the genuineness of all signatures, the authenticity of
all documents submitted to us as originals and the conformity to originals of
all documents submitted to us as certified or reproduced copies. We also have
obtained from the officers of AMC such advice as to such factual matters as we
consider necessary for the purpose of this opinion, and insofar as this opinion
is based on such matters of fact, we have relied on such advice. We express no
opinion as to the statistical information and the financial statements, the
notes thereto and related schedules and other financial data, included, or
documents incorporated by reference, in the Registration Statement.
Based on the foregoing, subject to the assumptions, limitations and
exceptions set forth herein, we are of the opinion that the Shares to be sold in
the Offering are duly authorized, validly issued, fully paid and nonassessable.
Our opinion expressed herein is limited to those matters expressly
set forth herein, and no opinion may be implied or inferred beyond the matters
expressly stated herein. We hereby disclaim any obligation to notify any person
or entity after the date hereof if any change in fact or law should change our
opinion with respect to any matter set forth in this letter.
This opinion is limited to the Delaware General Corporation Law and
the Securities Act, to present judicial interpretations thereof and to facts as
they presently exist. In rendering this opinion, we have no obligation to revise
or supplement it should such laws be changed by legislative action, judicial
decision or otherwise.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us under the caption "Legal
Matters" in the prospectus which is part of the Registration Statement.
Very truly yours,
/s/ Sheppard, Mullin, Richter & Hampton LLP
Page 29 of 31
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this Registration Statement of our reports dated December 15,
1998 included (or incorporated by reference) in Applied Magnetics Corporation's
Form 10-K for the fiscal year ended October 3, 1998 and to all references to our
firm included in this Registration Statement.
/s/ Arthur Andersen LLP
-----------------------
ARTHUR ANDERSEN LLP
Los Angeles, California
May 18, 1999
Page 30 of 31
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this Registration Statement of our reports dated May 11, 1999
included (or incorporated by reference) in the financial statements of DAS
Devices, Inc. for the fiscal year ended September 30, 1998 and to all references
to our firm included in this Registration Statement.
/s/ Arthur Andersen LP
----------------------
ARTHUR ANDERSEN LLP
Los Angeles, California
May 18, 1999.
Page 31 of 31
