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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 13, 1999
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
----------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
MAXTOR CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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DELAWARE 3572 77-0123732
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION NUMBER) IDENTIFICATION NO.)
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510 COTTONWOOD DRIVE
MILPITAS, CALIFORNIA 95035
(408) 432-1700
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
MICHAEL R. CANNON
PRESIDENT AND CHIEF EXECUTIVE OFFICER
MAXTOR CORPORATION
510 COTTONWOOD DRIVE
MILPITAS, CALIFORNIA 95035
(408) 432-1700
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
COPIES TO:
DIANE HOLT FRANKLE, ESQ.
Gray Cary Ware & Freidenrich LLP
400 Hamilton Avenue
Palo Alto, CA 94301-1825
(650) 833-2000
Approximate date of commencement of proposed sale to the public: As soon
as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are being offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, as amended (the "Securities Act") check the following box. [ ]
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 number of the earlier effective
registration statement for the same offering. [X]
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 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, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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PROPOSED
PROPOSED MAXIMUM
MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SHARES AMOUNT TO BE AGGREGATE PRICE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED PER SHARE (2) PRICE (1) FEE
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Common Stock, $0.01 par value.... 8,200,000 shares(1) $7.05 $57,810,000 $16,071.18
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(1) Consists of shares of Maxtor Corporation common stock issued in
connection with Maxtor's acquisition of Creative Design Solutions, Inc,
as described in the prospectus.
(2) Estimated pursuant to Rule 457(c) solely for the purpose of computing
the registration fee and based on the average high and low sale prices
of the common stock of Maxtor Corporation as reported on the Nasdaq
National Market on September 10, 1999.
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 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(a), MAY DETERMINE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE
SELLING STOCKHOLDERS MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SEC IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO
SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES
IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED SEPTEMBER 13, 1999
8,129,679 SHARES
MAXTOR CORPORATION
Common Stock
This prospectus relates to the offer and sale of up to 8,129,679 shares
of our common stock by certain selling stockholders of Maxtor Corporation
described in this prospectus under "Selling Stockholders."
Our common stock is quoted on The Nasdaq National Market under the
symbol "MXTR." On September 10, 1999, the last sale price of the common stock as
reported on The Nasdaq National Market was $7.00.
Our principal executive offices are located at 510 Cottonwood Drive,
Milpitas, California 95035, and our telephone number is (408) 432-1700.
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AN INVESTMENT IN MAXTOR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK.
PLEASE CAREFULLY CONSIDER THE INFORMATION UNDER THE HEADING "RISK FACTORS"
BEGINNING ON PAGE 3.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED 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 September 13, 1999.
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TABLE OF CONTENTS
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RISK FACTORS.................................................................................3
ABOUT MAXTOR................................................................................12
USE OF PROCEEDS.............................................................................13
SELLING STOCKHOLDERS........................................................................13
PLAN OF DISTRIBUTION........................................................................16
LEGAL MATTERS...............................................................................17
EXPERTS.....................................................................................17
WHERE TO FIND MORE INFORMATION..............................................................18
DOCUMENTS INCORPORATED BY REFERENCE.........................................................18
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RISK FACTORS
You should carefully consider the risks described below before making an
investment decision. The risks and uncertainties described below are not the
only ones that we face. Additional risks and uncertainties that we do not know
about or that we currently think are immaterial also may impair our business
operations.
Any of the following risks, if they actually occur, could materially and
adversely affect our business, financial condition or results of operations. In
such an event, the trading price of our common stock could decline, and you
could lose all or part of your investment.
WE HAVE A HISTORY OF LOSSES AND AN ACCUMULATED DEFICIT OF $755.6 MILLION
We have a history of significant losses. During each of the 19
consecutive quarters ended September 27, 1997, we incurred significant operating
losses ranging from $125.5 million to $3.1 million per quarter, with net losses
ranging from $130.2 million to $4.5 million. These losses were primarily a
result of the following:
- delayed product introductions;
- product performance and quality problems;
- low manufacturing yields and under-utilization of manufacturing
capacity;
- high operating and interest expenses; and
- overall market conditions in the hard disk drive industry,
including fluctuations in demand and declining average selling
prices.
We also had a net loss of $30.9 million for the quarter ended July 3, 1999 due
primarily to a significant decrease in average unit selling prices.
Furthermore, we believe that the decline in average selling prices that the
entire hard disk drive industry is experiencing is likely to continue and
thus, worsen profitability in the near future.
OUR AVERAGE SELLING PRICES ARE DECLINING
We anticipate that average selling prices in the hard disk drive
industry will continue to decline for the foreseeable future. The average
selling price of a hard disk drive rapidly declines over its commercial life due
to technological enhancement, productivity improvement, and also increase in
industry supply. This is true even for those products that are competitive and
introduced into the market in a timely manner. Average selling prices decline
even further when competitors lower prices to absorb excess capacity, liquidate
excess inventories, restructure or attempt to gain market share. These factors
make it very challenging to achieve and maintain profitability and revenue
growth in the hard disk drive industry.
UNLESS WE CONSISTENTLY EXECUTE, WE WILL HAVE SIGNIFICANT LOSSES
Most of our products are sold to desktop computer manufacturers. Such
manufacturers use the quality, storage capacity, performance and price
characteristics of hard disk drives to select, or qualify, their hard disk drive
suppliers. Such manufacturers typically seek to qualify three or four suppliers
for each hard disk drive product generation. To qualify consistently with these
manufacturers, and thus succeed in the desktop hard disk drive industry, we must
execute consistently on our product development and manufacturing processes to
be among the first-to-market introduction and first-to-volume production at
leading storage capacity per disk with competitive prices and high quality. Once
a manufacturer has chosen its hard disk drive suppliers for a given desktop
computer product, it generally will purchase hard disk drives from those
suppliers for the commercial life of that product line. If we miss a
qualification opportunity, we may not have another opportunity to do business
with that manufacturer until we introduce our next generation of products. The
effect of missing a product qualification opportunity is
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magnified by the limited number of high volume manufacturers of personal
computers. If we do not reach the market or deliver volume production in a
timely manner, we may lose opportunities to qualify our products, our gross
margins probably will decline due to rapidly declining average selling prices,
and we probably will lose market share.
SUBSTANTIAL DEPENDENCE ON THE DESKTOP COMPUTER MARKET
While there has been significant growth in the demand for desktop
computers over the past several years, according to International Data
Corporation, the growth rate in the desktop computer market has slowed in recent
quarters. Because of our reliance on the desktop segment of the personal
computer market, we will be affected more by changes in market conditions for
desktop computers than would a company with a broader range of products. Any
decrease in the demand for desktop computers could cause a decrease in the
demand for our products.
Although our current products are designed for the largest segment of
the hard disk drive market, the desktop computer market, demand may shift to
other market segments over time. We also believe that to remain a significant
supplier of hard disk drives to major manufacturers of personal computers, we
will need to offer a broader range of hard disk drive products to our customers.
Therefore, we will need to develop and manufacture new products that address
additional hard disk drive market segments and emerging technologies to remain
competitive in the hard disk drive industry. Examples of potentially important
market segments that our current products are not designed to address include:
- the client-server market;
- lower cost, lower performance personal computer systems
(typically below $699); and
- laptop personal computers.
To specifically address these or additional market segments, we would
have to reengineer some of our existing technology and develop new technology.
Certain of our competitors have significant advantages over us in one or more of
these and other potentially significant new or growing market segments. Any
failure by us to successfully develop and introduce new products to address
specifically these additional market segments could have a material adverse
effect on our business, financial condition and results of operations.
A SIGNIFICANT AMOUNT OF OUR REVENUE COMES FROM A FEW CUSTOMERS
We sell most of our products to a limited number of customers. During
the six months ended July 3, 1999, two customers, Dell and IBM, accounted for
approximately 26% and 10%, respectively, of our revenue, and our top ten
customers accounted for approximately 69% of our revenue. During the six months
ended June 27, 1998, two customers, Dell and IBM, accounted for approximately
27% and 17%, respectively, of our revenue, and our top ten customers accounted
for approximately 74% of our revenue.
We believe that a relatively small number of customers will continue to
account for a significant portion of our revenue for the foreseeable future, and
that the proportion of our revenue from such customers could continue to
increase in the future. These customers have a wide variety of suppliers to
choose from and therefore can make substantial demands on us. Even if we
successfully qualify a product for a given customer, such customer generally is
not obligated to purchase any minimum volume of products from us and generally
is able to terminate its relationship with us at any time. Our ability to
maintain strong relationships with our principal customers is essential to our
future performance. If we lose a key customer or if any of our key customers
reduce their orders of our products or require us to reduce our prices before we
are able to reduce costs, our business, financial condition and results of
operations could be materially and adversely affected.
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OUR QUARTERLY RESULTS FLUCTUATE SIGNIFICANTLY
Our quarterly results may not be indicative of our future performance.
Our quarterly operating results have fluctuated significantly in the past and
may fluctuate significantly in the future. Our future performance will depend on
many factors, including the following:
- our ability to be consistently among the first-to-volume
production with competitive products;
- the average unit selling prices of our products;
- fluctuations in the demand for hard disk drives as a result of
the cyclical and seasonal nature of the desktop computer
industry;
- the availability of and efficient use of manufacturing capacity;
- changes in product or customer mix;
- our existing competitors introducing better products at
competitive prices before we do;
- new competitors entering our market;
- our ability to manage successfully the complex and difficult
process of qualifying our products with our customers;
- our customers canceling, rescheduling or deferring significant
orders for our products, particularly in anticipation of new
products or enhancements from us or our competitors;
- the ability of certain of our distribution and retail customers
to return unsold products for credit;
- the ability of certain of our distribution and retail customers
to receive lower prices retroactively on their inventory of our
products when we lower prices on our products;
- our ability to purchase enough components and raw materials at
competitive prices which allow us to make a profit;
- the availability of adequate capital resources;
- increases in research and development expenditures, particularly
as a percentage of revenue, required to maintain our competitive
position;
- changes in our strategy;
- personnel changes; and
- other general economic and competitive factors.
Many of our operating expenses are relatively fixed and difficult to
reduce or modify. As a result, the fixed nature of our operating expenses will
magnify any adverse effect of a decrease in revenue on our results of
operations.
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As a result of these and other factors, we believe that period to period
comparisons of our historical results of operations are not good predictors of
our future performance. If our future operating results are below the
expectations of stock market analysts, our stock price may decline.
OUR CUSTOMERS ARE PLACING NEW AND COSTLY DEMANDS ON US
Our customers are adopting more sophisticated business models that place
additional strains on our business. For example, many personal computer
manufacturers, including some of our largest personal computer manufacturing
customers, are starting to adopt build-to-order manufacturing models that reduce
their component inventories and related costs and enable them to tailor their
products more specifically to the needs of their customers.
Some of our personal computer manufacturing customers also are
considering or have implemented a "channel assembly" model in which the
manufacturer ships a minimal computer system to the dealer or other assembler,
and component suppliers (including hard disk drive manufacturers such as us)
ship parts directly to the dealer or other assembler for installation at its
location. Finally, certain of our manufacturing customers have adopted
just-in-time inventory management processes that require component suppliers to
maintain inventory at or near the customer's production facility. These new
business models require us to hold our products in inventory longer, which
increases our risk of inventory obsolescence and average selling price decline.
These changing models also increase our capital requirements and costs,
complicate our inventory management strategies, and make it difficult for us to
match our manufacturing plans with projected customer demand.
THE HARD DISK DRIVE MARKET IS HIGHLY COMPETITIVE
The hard disk drive market in general is intensely competitive even
during periods when demand is stable. We compete primarily with manufacturers of
3.5-inch hard disk drives for the personal computer industry, including:
- Fujitsu Limited;
- Quantum Corporation;
- Samsung Electronic Company Limited;
- Seagate Technology, Inc.; and
- Western Digital Corporation.
We also could face significant competition from other companies, such as
International Business Machines Corporation, in our current markets or in other
markets into which we may expand our product portfolio.
Many of our competitors have a number of significant advantages over us,
including:
- a larger market share;
- a broader array of product lines;
- preferred vendor status with some of our customers;
- extensive name recognition and marketing power; and
- significantly greater financial, technical and manufacturing
resources.
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Unlike us, some of our competitors make many of their own components,
which may provide them with certain benefits including lower costs. Our
competitors also may:
- consolidate or establish strategic relationships among
themselves to lower their product costs or to otherwise compete
more effectively against us;
- lower their product prices to gain market share; or
- bundle their products with other products to increase demand for
their products.
In addition, new competitors could emerge and rapidly capture market share.
If we fail to compete successfully against current or future
competitors, our business, operating results and financial condition may be
materially and adversely affected.
DEMAND FOR OUR PRODUCTS FLUCTUATES
We currently offer a single product family that is designed for desktop
computers. As a result, the demand for our products depends on the overall
demand for desktop computers. The desktop computer and hard disk drive markets
tend to go through periods of rapid growth followed by periods of oversupply and
rapid price and gross margin erosion. This environment makes it difficult for
our customers and us to reliably forecast demand for our products. We do not
have long-term supply contracts with our customers, and our customers often can
defer or cancel orders with limited notice and without significant penalty.
WE MUST EFFECTIVELY RESPOND TO CHANGING TECHNOLOGY; WE MUST EFFECTIVELY
TRANSITION TO GIANT MAGNETO-RESISTIVE HEAD TECHNOLOGY
Our future performance will depend on our ability to enhance current
products and to develop and introduce volume production of new competitive
products on a timely and cost-effective basis. We also must keep pace with and
correctly anticipate technological developments and evolving industry standards
and methodologies. Advances in magnetic, optical or other technologies, or the
development of entirely new technologies, could lead to new competitive products
that have better performance and/or lower prices than our products. Examples of
such new technologies include giant magneto-resistive head technology (which
already has been introduced by IBM and Fujitsu and which Western Digital
reportedly will use in its products under an agreement with IBM) and
optically-assisted recording technologies (which currently are being developed
by companies such as TeraStor Corporation and Seagate). We have incorporated
giant magneto-resistive head technology into our newest products. We have
decided not to pursue optically-assisted recording technologies at this time.
Our inability to introduce or achieve volume production of new competitive
products, (regardless of whether they include giant magneto-resistive head
technology) on a timely and cost-effective basis has in the past and in the
future could have a material adverse effect on our business, financial condition
and results of operations.
TO DEVELOP NEW PRODUCTS, WE MUST EFFECTIVELY INTEGRATE PARTS FROM THIRD PARTIES
Unlike some of our competitors, we do not manufacture any of the parts
used in our products. Instead, our products incorporate parts designed by and
purchased from third parties. Consequently, the success of our products depends
on our ability to gain access to and integrate parts that use leading-edge
technology. To successfully manage these integration projects we must:
- obtain high quality parts;
- hire skilled personnel;
- effectively integrate different products from a variety of
vendors; and
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- manage difficult scheduling and delivery problems.
Our success will depend on our ability to develop and maintain relationships
with key suppliers.
WE DEPEND ON A LIMITED NUMBER OF SUPPLIERS
A number of the parts used in our products are available from only one
or a limited number of outside suppliers. Currently, we purchase digital signal
processor/controller and spin/servo integrated circuits only from Texas
Instruments, Inc. and purchase channel integrated circuits only from Lucent
Technologies, Inc. As we have experienced in the past, some of the parts we
require may periodically be in short supply. As a result, we must allow for
significant ordering lead times for certain parts. In addition, we may have to
pay significant cancellation charges to suppliers if we cancel orders for parts
because we reduce production due to production cut-backs caused by market
oversupply, reduced demand, transition to new products or technologies or for
other reasons. We order the majority of our parts on a purchase order basis and
only have limited long-term volume purchase agreements with certain existing
suppliers. If we cannot obtain sufficient quantities of high quality parts when
we need them, our business, financial condition and results of operations could
be materially and adversely affected.
WE DEPEND ON OUR KEY PERSONNEL
Our success depends upon the continued contributions of our key
employees, many of whom would be extremely difficult to replace. We also do not
have key person life insurance on any of our personnel. Worldwide competition
for skilled employees in the hard disk drive industry is extremely intense. We
believe that some of our competitors recently have made targeted efforts to
recruit employees from us and such efforts have resulted in us losing some
skilled managers. There is no guarantee that we will be successful in retaining
our key employees. If we are unable to retain our existing employees or to hire
and integrate new employees, our business, financial condition and results of
operations could be materially and adversely affected.
WE HAVE LIMITED MANUFACTURING FACILITIES, WHICH MAY FAIL TO MEET OUR FUTURE
MANUFACTURING REQUIREMENTS AND WHICH MAY BE DAMAGED BY NATURAL DISASTERS OR
OTHER EVENTS
Our volume manufacturing operations currently are based in two
facilities in Singapore. A fire, flood, earthquake or other disaster or
condition affecting either or both of our facilities could have a material
adverse effect on our business, financial condition and results of operations.
Although we have taken steps to ensure that manufacturing facilities will be
available, our inability to fit-up our facilities to meet our customers' demands
in a timely manner could limit our growth and could have a material adverse
effect on our business, financial condition and results of operations.
Additionally, the development of excess manufacturing capacity could have a
material adverse effect on our business, financial condition and results of
operations.
WE MAY NEED MORE CAPITAL IN THE FUTURE BECAUSE THE HARD DISK DRIVE BUSINESS IS
CAPITAL INTENSIVE
Our business is capital intensive, and we may need more capital in the
future. Our future capital requirements will depend on many factors, including:
- the rate of our sales growth;
- the level of our profits or losses;
- the timing and extent of our spending to support facilities
upgrades and product development efforts;
- the timing and size of business or technology acquisitions; and
- the timing of introductions of new products and enhancements to
our existing products.
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We may issue additional equity to raise capital. Any future equity
financing will decrease existing stockholders' percentage equity ownership and
may, depending on the price at which the equity is sold, result in significant
economic dilution to such stockholders. Furthermore, our board of directors is
authorized under our charter documents to issue preferred stock with rights,
preferences or privileges senior to those of our common stock without
stockholder approval.
While we currently do not have a revolving credit facility, it is our
goal to obtain one in the future. However, we believe that current market
conditions for such facilities are not as favorable as they have been at certain
times in the past, that for various reasons the number of potential lenders
actively providing credit facilities to companies in the data storage industry
has decreased, and that the terms on which the remaining potential lenders are
willing to offer such facilities, in many cases, are restrictive and/or costly.
Consequently, the terms and conditions under which we might obtain such a
facility are uncertain. Any failure to obtain adequate credit facilities on
acceptable terms could have a material and adverse effect on our business,
financial condition and results of operations.
PROTECTION OF OUR INTELLECTUAL PROPERTY IS LIMITED; WE FACE RISK OF THIRD PARTY
CLAIMS OF INFRINGEMENT
We have patent protection on some of our technology. We may not receive
patents for our current or future patent applications, and any patents that we
have or that are issued to us may be invalidated, circumvented or challenged.
Moreover, the rights granted under any such patents may not provide us with any
competitive advantages. Finally, our competitors may develop or otherwise
acquire equivalent or superior technology.
We also rely on trade secret, copyright and trademark laws, as well as
the terms of our contracts to protect our proprietary rights. We may have to
litigate to enforce patents issued or licensed to us, to protect trade secrets
or know-how owned by us or to determine the enforceability, scope and validity
of our proprietary rights and the proprietary rights of others. Enforcing or
defending our proprietary rights could be expensive and might not bring us
timely and effective relief.
We may have to obtain licenses of other parties' intellectual property
and pay royalties. If we are unable to obtain such licenses, we may have to stop
production of our products or alter our products. In addition, the laws of
certain countries in which we sell and manufacture our products, including
various countries in Asia, may not protect our products and intellectual
property rights to the same extent as the laws of the United States. Our
protective measures in these countries may be inadequate to protect our
proprietary rights. Any failure to enforce and protect our intellectual property
rights could have a material adverse effect on our business, financial condition
and results of operations.
When we were a majority-owned subsidiary of Hyundai Electronics America,
we had the benefit of certain third party intellectual property rights on terms
that may have been more favorable than would have been available to us if we had
not been a majority-owned subsidiary of Hyundai Electronics America. We may not
be able to obtain similar rights in the future on terms as favorable.
We have been sued by Papst-Motoren GmbH and Papst Licensing
(collectively "Papst") claiming infringement of a number of hard disk drive
motor patents. The lawsuit is pending in the United States District Court for
the Northern District of California. This lawsuit relates to the alleged
infringement of 15 of the hard disk drive motor patents. The patents in question
relate to motors that we purchase from motor vendors and the use of such motors
in hard disk drives. We filed our Answer and Counterclaim on May 19, 1999,
alleging defenses of implied license, patent exhaustion, misuse, invalidity,
unenforceability and noninfringement, among others. We also filed a motion to
bifurcate for early discovery the license, exhaustion and misuse defenses. At
hearing on July 21, 1999, the Court stayed further action in the case pending
the outcome of a motion filed by Papst on July 13, 1999, seeking coordination
and transfer of this case with several other actions involving Papst patents.
This motion was filed with the Judicial Panel on Multidistrict Litigation in
Washington, D.C. On August 5, 1999, we filed our opposition to the motion. No
hearing date has been set in that proceeding. A further status conference in the
District Court is scheduled for October 27, 1999. While we believe that our
defenses to the Papst claim are valid, the results of any litigation are
inherently uncertain and there is no assurance that Papst will not assert other
infringement claims relating to current patents, pending patent applications and
future patents or patent applications. Additionally, there is no assurance that
we will be able to successfully defend ourselves against any such lawsuit. A
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favorable outcome for Papst in the lawsuit could result in the issuance of an
injunction against us or our products and/or the payment of monetary damages
equal to a reasonable royalty or recovered lost profits or, in the case of a
finding of a willful infringement, treble damages and could have a material
adverse effect on our business, financial condition and results of operations.
WE ARE DEPENDENT ON OUR INTERNATIONAL OPERATIONS; WE FACE RISKS FROM OUR
INTERNATIONAL SALES
We conduct most of our manufacturing and testing operations and purchase
a substantial portion of our key parts outside the U.S. We also sell a
significant portion of products to foreign distributors and retailers.
Our dependence on revenue from international sales and our need to
manage international operations each involves a number of inherent risks,
including:
- economic slowdown and/or downturn in the computer industry in
such foreign markets;
- international currency fluctuations;
- general strikes or other disruptions in working conditions;
- political instability;
- trade restrictions;
- changes in tariffs;
- the difficulties associated with staffing and managing
international operations;
- generally longer periods to collect receivables;
- unexpected changes in or impositions of legislative or
regulatory requirements;
- reduced protection for intellectual property rights in some
countries;
- potentially adverse taxes; and
- delays resulting from difficulty in obtaining export licenses
for certain technology and other trade barriers.
The specific economic conditions in each country will impact our
international sales. For example, our international contracts are denominated
primarily in U.S. dollars. Significant downward fluctuations in currency
exchange rates against the U.S. dollar could cause our products to become
relatively more expensive to distributors and retailers in those countries. In
addition, we attempt to manage the impact of foreign currency exchange rate
changes by entering into short-term, foreign exchange contracts. If we do not
effectively manage the risks associated with international operations and sales,
our business, financial condition and results of operations could be materially
and adversely affected.
WE HAVE EXPOSURE FROM OUR WARRANTIES
Our products may contain defects. We generally warrant our products for
three years. Our standard warranty contains a limit on damages and an exclusion
of liability for consequential damages and for negligent or improper use of the
product. We establish a reserve, at the time of product shipment, in an amount
equal to our estimated warranty expenses. We had warranty reserves of $41.8
million as of July 3, 1999. While we believe that our warranty reserves will be
sufficient, the failure to maintain sufficient warranty reserves or the
unenforceability
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of our liability limitations could have a material adverse effect on our
business, financial condition and results of operations.
OUR STOCK PRICE HAS BEEN HIGHLY VOLATILE
Our stock price and the number of shares traded each day have varied
greatly. We expect these fluctuations to continue due to factors including:
- quarterly fluctuations in operating results;
- announcements of new products by us or our competitors;
- gains or losses of significant customers;
- changes in stock market analysts' estimates;
- the presence or absence of short-selling of our common stock;
and
- events affecting other companies that the market deems
comparable to us.
Our stock price also may be affected by events relating to Hyundai
Electronics America and Hyundai Electronics Industries, including sales of our
common stock by Hyundai Electronics America or the perception that such sales
may occur (due to the financial condition of Hyundai Electronics America or
otherwise). There have been reports that Hyundai Electronics Industries is
planning to sell some operations that do not directly relate to its core
semiconductor business. Hyundai Electronics America and Hyundai Electronics
Industries have informed Maxtor that they may consider selling additional Maxtor
shares at a time they deem appropriate. Finally, our stock price may be subject
to extreme fluctuations in response to general economic conditions in the U.S.,
Korea, Southeast Asia and elsewhere, such as interest rates, inflation rates,
exchange rates, unemployment rates, and trade surpluses and deficits. It is
likely that in some future quarter or quarters our operating results will be
below the expectations of stock market analysts or investors. In such event, our
stock price probably will decline.
In February 1999, DECS Trust IV, a newly-formed trust, sold 12,500,000
DECS, where each DECS represents an equal proportional interest in the DECS
Trust IV. The terms of the DECS provide that DECS Trust IV may distribute shares
of our common stock owned by Hyundai Electronics America on or about February
15, 2002, or upon earlier liquidation of DECS Trust IV under certain
circumstances. We do not know how or whether investors in the DECS offering will
resell the DECS. Any market that develops for the DECS could reduce the demand
for our common stock or otherwise negatively affect the market for our common
stock.
11
<PAGE> 13
ABOUT MAXTOR
We are a leading provider of hard disk drives for desktop computers. Our
products have high speed interfaces for greater data throughput, a robust
mechanical design for improved reliability, magneto-resistive head technology
and a digital signal processor-based electronic architecture that, when
combined, provide industry-leading benchmark performance. We produce products in
the DiamondMax product family, consisting of 3.5 inch hard disk drives with
storage capacities which range from 6.4 gigabytes to 36 gigabytes. Customers are
desktop computer manufacturers, including Compaq, Dell and IBM; distributors,
including Bell Micro and Ingram; and retailers, including Best Buy, CompUSA and
Staples.
During the mid-1980's, we were a leading technology innovator in the
hard disk drive industry. We completed an initial public offering of common
stock in 1986. Hyundai Electronics America acquired all of our outstanding stock
through a series of transactions in 1994 and 1996. Shortly thereafter, Hyundai
Electronics America invested in efforts to revitalize Maxtor. Our current Chief
Executive Officer and President and a 20 year veteran of the hard disk drive
industry, Michael R. Cannon, took office in July 1996. As a result of changes he
and other members of management made, our performance improved significantly
during a period of severe fluctuations in the overall hard disk drive market.
Since 1996, due to various transactions by us and Hyundai Electronics America,
the ownership by Hyundai Electronics America of our common stock has decreased
to approximately 40% as of April 30, 1999. Maxtor and Hyundai Electronics
America are parties to various agreements governing their relationship as
described in the SEC filings referred to under "Documents Incorporated by
Reference."
Maxtor was incorporated in Delaware in July 1986. Our principal
executive offices are located at 510 Cottonwood Drive, Milpitas, California
95035, and our telephone number is 408-432-1700.
12
<PAGE> 14
USE OF PROCEEDS
We will not receive any proceeds from the sale of the shares of common
stock by the selling stockholders and all proceeds will go to the selling
stockholders to be used for their own purposes.
SELLING STOCKHOLDERS
The selling stockholders acquired shares of our common stock in
connection with our acquisition of all of the outstanding stock of Creative
Design Solutions, Inc. on September 10, 1999.
The following table lists the selling stockholders, the number of shares
of our common stock which each owned following consummation of the acquisition,
the number of shares of our common stock expected to be sold by each, and the
number and the percentage of the shares of our common stock which each will own
after the offering pursuant to the Registration Statement, assuming the sale of
all the shares expected to be sold.
<TABLE>
<CAPTION>
Shares
Owned Shares Percentage
Before Shares To Be Owned After Owned After
Selling Stockholder Offering Offered Offering Offering
- --------------------------------------------------- -------------- --------------- --------------- ------------------
<S> <C> <C> <C> <C>
ADO Electronic Industrial Co., Ltd. 217,400 217,400 0 --
Athena Venture Fund, L.P. 296,622 296,622 0 --
Andreas V. Bechtolsheim 148,310 148,310 0 --
Jerry R. Bergis 2,989 2,989 0 --
William S. Bryan 3,623 3,623 0 --
Bryant Trust DTD 9/7/94 21,740 21,740 0 --
Roy F. Carlson, Jr. 43,480 43,480 0 --
Stella Chen 10,057 10,057 0 --
William J. Del Biaggio III 13,044 13,044 0 --
F&W Investments 1996-II 21,740 21,740 0 --
F&W Investments 1998 3,176 3,176 0 --
Donald N. Ferrera and Carolyn M. Ferrera 1996 57,307 57,307 0 --
Revocable Trust dtd 4/10/96
Greg and Lisa Finley, as CP 3,261 3,261 0 --
Forefront Venture Partners, L.P. 170,366 170,366 0 --
</TABLE>
13
<PAGE> 15
<TABLE>
<CAPTION>
Shares
Owned Shares Percentage
Before Shares To Be Owned After Owned After
Selling Stockholder Offering Offered Offering Offering
- --------------------------------------------------- -------------- --------------- --------------- ------------------
<S> <C> <C> <C> <C>
Robert Hakim 49,832 49,832 0 --
Peter Harvey 434,800 434,800 0 --
Intel Corporation 682,914 682,914 0 --
InveStar Excelsus Venture Capital (Int'l) Inc., 340,732 340,732 0 --
LDC
JAFCO Co., Ltd. 35,594 35,594 0 --
JAFCO G-6(A) Investment Enterprise Partnership 39,780 39,780 0 --
JAFCO G-6(B) Investment Enterprise Partnership 39,780 39,780 0 --
JAFCO JS-3 Investment Enterprise Partnership 26,277 26,277 0 --
JAFCO R-3 Investment Enterprise Partnership 36,538 36,538 0 --
William N. Joy 74,155 74,155 0 --
Victoria J. Koepnick 53,263 53,263 0 --
Jay Kramer 65,220 65,220 0 --
Albert Leung 147,832 147,832 0 --
Jeremy Liang 2,707 2,707 0 --
Gordon D. Liechti 54,349 54,349 0 --
Luzon Investments Ltd. 130,440 130,440 0 --
Francis P. Mabunga 16,933 16,933 0 --
Marshall Kirk McKusick 3,261 3,261 0 --
Netis Technology, Inc. 49,832 49,832 0 --
Wo Overstreet 265,228 265,228 0 --
Gianni Paliska 82,612 82,612 0 --
Peckham Revocable Trust DTD 9/25/92 43,480 43,480 0 --
Robert W. Peters and Carolyn H. Peters, Trustees 49,832 49,832 0 --
of The Robert W. Peters and Carolyn H. Peters
1992 Trust UTA dtd 1/10/92
Jim Potochny 108,700 108,700 0 --
Prototech, Inc. 3,130,566 3,130,566 0 --
Joseph S. Rocca 16,425 16,425 0 --
Kristina Rossi 1,900 1,900 0 --
Roy Sardina 85,025 85,025 0 --
Yuri R. Spiro 13,044 13,044 0 --
Clifford E. Strang 39,673 39,673 0 --
Superstar Capital Inc. 11,206 11,206 0 --
Anna Hsuehhsia Tang 6,522 6,522 0 --
Jerry Tennant 36,958 36,958 0 --
Tuckerwell Ltd. 130,440 130,440 0 --
</TABLE>
14
<PAGE> 16
<TABLE>
<CAPTION>
Shares
Owned Shares Percentage
Before Shares To Be Owned After Owned After
Selling Stockholder Offering Offered Offering Offering
- --------------------------------------------------- -------------- --------------- --------------- ------------------
<S> <C> <C> <C> <C>
U.S. Information Technology No. 2 Investment 711,895 711,895 0 --
Enterprise Partnership
Joseph P. Wilkens 6,521 6,621 0 --
Thomas Yoshida 6,338 6,338 0 --
Tom and Hiroko Yoshida 43,480 43,480 0 --
Jon Zahornacky 43,480 43,480 0 --
</TABLE>
15
<PAGE> 17
PLAN OF DISTRIBUTION
We have been advised by the selling stockholders that they may sell all
or a portion of their shares of common stock. The selling stockholders plan to
sell on the Nasdaq National Market, or otherwise. The selling stockholders may
sell their shares:
- at prices and on terms prevailing at the time of sale;
- at prices related to the then current market price; or
- in negotiated transactions.
The selling stockholders may sell their shares by one or more of the
following methods:
- block trades in which the broker or dealer so engaged will
attempt to sell the Shares as agent, but may position and resell
a portion of the block as principal to facilitate the
transaction;
- purchases by a broker or dealer as principal and resale by such
broker or dealer for its own account pursuant to this
prospectus;
- on over-the-counter distribution in accordance with the rules of
the Nasdaq National Market;
- ordinary brokerage transactions and transactions in which the
broker solicits purchasers; and
- privately negotiated transactions.
There is no assurance that selling stockholders will offer or sell any
or all of their shares of common stock registered under this prospectus. An
escrow agent will hold in escrow 850,000 of the shares of stock owned by the
selling stockholders. This escrow lasts until one year after the closing of the
acquisition of Creative Design Solutions, Inc. The escrow fund will secure
indemnification obligations in connection with the acquisition. Accordingly,
shares held in escrow are not available for sale at this time.
In addition, certain of the selling stockholders are venture capital
funds, corporations or trusts which may, in the future, distribute their shares
to their partners, stockholders or trust beneficiaries, respectively, which
distributees may likewise distribute such shares to their partners, stockholders
or trust beneficiaries. Those shares may later be sold by those partners,
stockholders or trust beneficiaries, or any of their respective distributees.
The selling stockholders, any underwriter, any broker-dealer or any
agent that participates with the selling stockholders in the distribution of the
shares may be deemed to be "underwriter" within the meaning of the Securities
Act. As a result, any discounts, commissions or concessions received by them and
any profit on the resales of the shares purchased by them may be deemed to be
underwriting commissions under the Securities Act.
We will pay expenses, other than underwriting discounts and commissions,
if any, incurred in connection with the offering and sale to the public of
shares by the selling stockholders, including, without limitation, all
registration and filing fees, printing expenses, transfer agents' and
registrars' fees, the fees and disbursements of our outside counsel and
independent accountants and the reasonable fees of a single counsel for the
selling stockholders.
We agreed with the selling stockholders to keep the registration
statement of which this prospectus constitutes a part effective until the
earlier of:
- such time as each of the selling stockholders may sell all of
the shares held by him, her or it without registration pursuant
to Rule 144 under the Securities Act within a three-month
period;
- such time as all of the shares have been sold by the selling
stockholders; or
- one year following the date of the closing of the
acquisition of Creative Design Solutions, Inc.
16
<PAGE> 18
We intend to de-register any of the shares not sold by the selling
stockholders at the end of such period. At such time, however, any unsold shares
may be freely tradable subject to compliance with Rule 144 of the Securities
Act.
We have agreed to indemnify in certain circumstances the selling
stockholders and any underwriter and certain control and other persons related
to the foregoing persons against certain liabilities, including liabilities
under the Securities Act. The selling stockholders have agreed to indemnify in
certain circumstances Maxtor and certain related persons against certain
liabilities, including liabilities under the Securities Act.
LEGAL MATTERS
The legality of the shares offered by this prospectus is being passed
upon by Gray Cary Ware & Freidenrich LLP, Palo Alto, California.
EXPERTS
The financial statements incorporated in this prospectus and
registration statement by reference to the Annual Report on Form 10-K for the
year ended December 26, 1998 have been so incorporated in reliance on the report
of PricewaterhouseCoopers LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
17
<PAGE> 19
WHERE TO FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. These reports, proxy statements and other
information filed with the SEC may be inspected and copied at the SEC Public
Reference Room, 450 Fifth Street, N.W., Washington, D.C. 20549.
You may obtain information about the operation of the SEC Public
Reference Room by calling 1-800-SEC-0330. You can also inspect this material
free of charge at a Web site maintained by the SEC at http://www.sec.gov.
Finally, you can also inspect reports and other information concerning Maxtor at
the offices of the National Association of Securities Dealers, Inc., Market
Listing Section, 1735 K Street, N.W., Washington, D.C. 20006. Maxtor common
stock is traded on The Nasdaq National Market under the symbol "MXTR." Maxtor's
Internet web site is located at http://www.maxtor.com.
DOCUMENTS INCORPORATED BY REFERENCE
The SEC allows us to "incorporate by reference" information that we file
with them which means that we can disclose important information to you by
referring you to these documents. The information incorporated by reference is
an important part of this prospectus and information we later file with the SEC
will automatically update and supersede this information. The following
documents filed by us with the SEC are incorporated in this prospectus by
reference:
- Annual Report on Form 10-K for the year ended December 26, 1998,
filed on March 26, 1999;
- Current Report on Form 8-K, filed on January 20, 1999;
- Current Report on Form 8-K, filed on January 22, 1999;
- Quarterly Report on Form 10-Q for the quarter ended April 3,
1999, filed on May 18, 1999;
- Quarterly Report on Form 10-Q for the quarter ended July 3,
1999, filed on August 16, 1999; and
- The description of Maxtor's common stock contained in Maxtor's
Registration Statement on Form 8-A filed under the Securities
Exchange Act, including any amendment or report filed for the
purpose of updating that description.
We also incorporate by reference all documents and reports filed by us
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934 after the date of this prospectus. We will provide free of charge to each
person, including any beneficial owner, to whom this prospectus is delivered,
upon written or oral request, a copy of any or all of the documents incorporated
by reference in this prospectus. Please direct such requests to Investor
Relations, Maxtor Corporation, 510 Cottonwood Drive, Milpitas, California 95035.
Our telephone number is (408) 432-1700.
18
<PAGE> 20
WE HAVE NOT AUTHORIZED ANYONE TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE
IN THIS PROSPECTUS. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN
THIS PROSPECTUS. THE INFORMATION IN THIS PROSPECTUS IS CORRECT AS OF THE
DATE OF THIS PROSPECTUS. DELIVERY OF THIS PROSPECTUS AFTER THE DATE
INDICATED BELOW DOES NOT MEAN THAT THE INFORMATION IS STILL CORRECT.
8,129,679 SHARES
MAXTOR CORPORATION
COMMON STOCK
----------
PROSPECTUS
----------
September 13, 1999
<PAGE> 21
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the costs and 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 fees and Nasdaq
filing fee.
<TABLE>
<CAPTION>
To be Paid
By The
Registrant
----------
<S> <C>
SEC Registration Fee $16,071.18
Nasdaq filing fee $17,500.00
Accounting fees and expenses $15,000.00
Legal fees and expenses $15,000.00
Miscellaneous expenses $ 428.82
----------
Total....................................................................... $64,000.00
==========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Pursuant to the provisions of the Delaware General Corporation Law, the
Registrant has adopted provisions in its Amended and Restated Certificate of
Incorporation which provide that members of its board of directors shall not be
personally liable for monetary damages to the Registrant or its stockholders for
a breach of fiduciary duty as a director, except for liability as a result of:
(i) a breach of the director's duty of loyalty to the Registrant or its
stockholders; (ii) acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law; (iii) an act related to
the unlawful stock repurchase or payment of a dividend under Section 174 of the
Delaware General Corporation Law; and (iv) transactions from which the director
derived an improper personal benefit. Such limitation of liability does not
affect the availability of equitable remedies such as injunctive relief or
rescission.
The Amended and Restated Certificate of Incorporation also authorizes
the Registrant to indemnify its officers, directors and other agents, by bylaws,
agreements or otherwise, to the full extent permitted under Delaware law. The
Registrant has and intends to continue to enter into separate indemnification
agreements with each of its directors and officers which may, in some cases, be
broader than the specific indemnification provisions contained in the Delaware
General Corporation Law. The indemnification agreements may require the
Registrant, among other things, to indemnify such officers and directors against
certain liabilities that may arise by reason of their status or service as
directors or officers (other than liabilities arising from willful misconduct of
a culpable nature), to advance their expenses incurred as a result of any
proceeding against them as to which they could be indemnified and to obtain
directors' and officers' insurance if available on reasonable terms.
These indemnification provisions and the indemnification agreement
entered between the Registrant and its officers and directors may be
sufficiently broad to permit indemnification of the Registrant's officers and
directors for liabilities (including reimbursement of expenses incurred) arising
under the Securities Act.
II-1
<PAGE> 22
ITEM 16. EXHIBITS.
The following exhibits are filed with this Registration Statement:
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------- ----------------------
<S> <C>
5.1 Opinion of Gray Cary Ware & Freidenrich LLP.
23.1 Consent of Independent Accountants.
23.2 Consent of Gray Cary Ware & Freidenrich LLP (included in Exhibit
5.1).
24.1 Power of Attorney (included in the Signature Page contained
in Part II of the Registration Statement).
</TABLE>
- ----------
ITEM 17. UNDERTAKINGS.
A. The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3)
of the Securities Act of 1933 (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement
(or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would
not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective registration
statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement; provided,
however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a
post-effective amendment by those paragraphs is
contained in periodic reports filed by the Registrant
pursuant to Section 13 or Section 15(d) of the
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, 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.
II-2
<PAGE> 23
B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to section 13(a) or section 15(d) of
the Securities Exchange Act of 1934 that is incorporated by reference in
the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
C. The undersigned Registrant hereby undertakes to deliver or cause to
be delivered with the prospectus, to each person to whom the prospectus
is sent or given, the latest annual report to security holders 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
Securities Exchange Act of 1934; and, where interim financial
information required to be presented by Article 3 of Regulation S-X are
not set forth in the prospectus, to deliver, or cause to be delivered to
each person to whom the prospectus is sent or given, the latest
quarterly report that is specifically incorporated by reference in the
prospectus to provide such interim financial information.
D. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers, and controlling
persons of the Registrant pursuant to the 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 Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer, or controlling person of the
Registrant in the successful defense of any action, suit, or proceeding)
is asserted by such director, officer, or controlling person in
connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
E. The undersigned Registrant hereby undertakes that:
(1) For the purposes of determining any liability under the
Securities Act, 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
the registration statement as of the time it was declared
effective.
(2) For the purposes of determining any liability under the
Securities Act, 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-3
<PAGE> 24
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of Milpitas,
County of Santa Clara, State of California on September 13, 1999.
MAXTOR CORPORATION
By: /s/ MICHAEL R. CANNON
---------------------------------
Michael R. Cannon
President and Chief Executive
Officer (Principal Executive
Officer)
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Paul J. Tufano and Glenn H.
Stevens, and each of them acting individually, as his true and lawful
attorneys-in-fact and agents, each with full power of substitution, for him in
any and all capacities, to sign any and all amendments to this Registration
Statement (including post-effective amendments or any abbreviated registration
statement and any amendments thereto filed pursuant to 462(b) increasing the
number of securities for which registration is sought), and to file the same,
with exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, with full power of each to act alone, full power and authority to do and
perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully for all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorneys-in-fact
and agents, or his or their substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ DR. CHONG SUP PARK Chairman of the Board September 13, 1999
- ----------------------------------
Dr. Chong Sup Park
/s/ MICHAEL R. CANNON President, Chief Executive September 13, 1999
- ---------------------------------- Officer and Director
Michael R. Cannon
/s/ PAUL J. TUFANO Senior Vice President, Finance, September 13, 1999
- ---------------------------------- Chief Financial Officer and
Paul J. Tufano Principal Accounting Officer
Director September __, 1999
- ----------------------------------
Chang See Chung
</TABLE>
II-4
<PAGE> 25
<TABLE>
<S> <C> <C>
/s/ CHARLES HILL Director September 13, 1999
- ----------------------------------
Charles Hill
/s/ CHARLES F. CHRIST Director September 13, 1999
- ----------------------------------
Charles F. Christ
/s/ Y.H. KIM Director September 13, 1999
- ----------------------------------
Y.H. Kim
/s/ THOMAS CHUN Director September 13, 1999
- ----------------------------------
Thomas Chun
/s/ ROGER W. JOHNSON Director September 13, 1999
- ----------------------------------
Roger W. Johnson
</TABLE>
II-5
<PAGE> 26
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------- ----------------------
<S> <C>
5.1 Opinion of Gray Cary Ware & Freidenrich LLP.
23.1 Consent of Independent Accountants.
23.2 Consent of Gray Cary Ware & Freidenrich LLP (included in Exhibit
5.1).
24.1 Power of Attorney (included in the Signature Page contained
in Part II of the Registration Statement).
</TABLE>
<PAGE> 1
[LETTERHEAD OF GRAY CARY WARE - FREIDENRICH LLP]
EXHIBIT 5.1
September 10, 1999
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: MAXTOR CORPORATION
REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
As legal counsel for Maxtor Corporation, a Delaware corporation (the "Company"),
we are rendering this opinion in connection with the preparation and filing of a
registration statement on Form S-3 (the "Registration Statement") relating to
the registration under the Securities Act of 1933, as amended, of 8,200,000
shares of Common Stock, par value $0.01 per share (the "Common Stock"), issuable
by the Company pursuant to an Agreement and Plan of Reorganization, dated as of
August 23, 1999, among the Company, Popup Acquisition Corporation, a Delaware
corporation and a wholly-owned subsidiary of the Company, Creative Design
Solutions, Inc. and Principal Shareholder (the "Agreement").
We have examined such instruments, documents and records as we deemed relevant
and necessary for the basis of our opinion hereinafter expressed. In such
examination, we have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and the conformity to
the originals of all documents submitted to us as copies.
Based on such examination, we are of the opinion that the 8,200,000 shares of
Common Stock of the Company being registered pursuant to the Registration
Statement and to be sold by the selling stockholders are duly authorized shares
of Common Stock and, when issued in accordance with the Agreement, will be
validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement referred to above and the use of our name wherever it
appears in said Registration Statement.
This opinion is to be used only in connection with the issuance of the Common
Stock while the Registration Statement is in effect.
Very truly yours,
/s/ GRAY CARY WARE & FREIDENRICH LLP
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated January 21, 1999, relating to the
financial statements and financial statement schedule, which appear in Maxtor
Corporation's Annual Report on Form 10-K for the year ended December 26, 1998.
We also consent to the reference to us under the heading "Experts" in such
Registration Statement.
/s/ PRICEWATERHOUSECOOPERS LLP
San Jose, California
September 9, 1999
