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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 26, 2000
REGISTRATION NO. 333-90731
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
POST-EFFECTIVE
AMENDMENT NO. 1
TO
FORM S-2
ON
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
-------------------
RADYNE COMSTREAM INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
-------------------
NEW YORK 3665
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER)
-------------------
11-2569467
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
3138 EAST ELWOOD STREET
PHOENIX, ARIZONA 85034
(602) 437-9620
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S
PRINCIPAL EXECUTIVE OFFICES)
ROBERT C. FITTING, CHIEF EXECUTIVE OFFICER
RADYNE COMSTREAM INC.
3138 EAST ELWOOD STREET
PHOENIX, ARIZONA 85034
(602) 437-9620
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------
COPY TO:
STEVEN D. PIDGEON, ESQ.
MARK A. STOLESON, ESQ.
SNELL & WILMER L.L.P.
ONE ARIZONA CENTER
PHOENIX, ARIZONA 85004-0001
(602) 382-6000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From
time to time after the effective date of this registration statement.
If 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, check the following box: [X]
If the registrant elects to deliver its latest annual report to
security holders, or a complete and legible facsimile thereof, pursuant to item
11(a)(1) of this form, 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, 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 earliest effective registration
statement for the same offering: [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earliest 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 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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EXPLANATORY NOTE
This Registration Statement on Form S-3 is the first post-effective
amendment to the Company's Registration Statement on Form S-2 filed as of
November 12, 1999, which was amended by pre-effective Amendment No. 1 filed as
of January 12, 2000, pre-effective Amendment No. 2 filed as of January 24, 2000
and pre-effective Amendment No. 3 filed as of February 7, 2000.
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Subject to Completion, Dated April 26, 2000
PROSPECTUS
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission 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.
3,000,000 SHARES
RADYNE COMSTREAM INC.
COMMON STOCK
On February 11, 2000, we completed a public offering of units, with
each unit consisting of one share of common stock and one redeemable common
stock purchase warrant. This prospectus relates to the possible issuance by
Radyne from time to time of up to 2,760,000 shares of common stock underlying
the redeemable warrants issued in connection with our public offering of units,
and 240,000 shares of common stock issuable upon exercise of the common stock
purchase option that we granted to the representative of the underwriters.
Each of the redeemable warrants is exercisable through February 7, 2005
to purchase one share of our common stock at a price of $8.75 per share. We may
redeem each redeemable warrant at a redemption price of $0.01 per warrant upon
not less than 30 nor more than 60 days' notice, but only if specific conditions
are met.
Our redeemable warrants are publicly traded on the Nasdaq SmallCap
Market under the symbol "RADNW." On April 25, 2000, the closing sales price for
our warrants on the Nasdaq SmallCap Market was $9.625. Our common stock is
publicly traded on the Nasdaq SmallCap Market under the symbol "RADN." On April
25, 2000, the closing sales price for our common stock on the Nasdaq SmallCap
Market was $16.375. We have applied for the listing of both our warrants and our
common stock on the Nasdaq National Market.
AN INVESTMENT IN THESE SECURITIES IS RISKY. YOU SHOULD ONLY PURCHASE
THESE SECURITIES IF YOU CAN AFFORD TO LOSE YOUR ENTIRE INVESTMENT. SEE "RISK
FACTORS" BEGINNING ON PAGE 6 FOR A DISCUSSION OF CERTAIN FACTORS THAT YOU SHOULD
CONSIDER BEFORE YOU INVEST IN THE SECURITIES BEING SOLD WITH THIS PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED ON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS _____________, 2000
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WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement with respect to
this offering of our securities. This prospectus only constitutes part of the
registration statement and does not contain all of the information set forth in
the registration statement, its exhibits and its schedules.
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. Our SEC filings are available to the public over
the Internet at the SEC's web site at http://www.sec.gov. You may also read and
copy any document we file at the SEC's public reference rooms in Washington,
D.C., New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for
additional information on the public reference rooms. We are also listed on the
Nasdaq SmallCap Market. Our periodic reports, proxy statements and other
information can be inspected at the offices of Nasdaq at 1735 K Street, NW,
Washington, DC, 20006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with them. This prospectus incorporates important business and financial
information about us, which is not included in or delivered with this
prospectus. The information incorporated by reference is an important part of
this prospectus, and information that we file later with the SEC will
automatically update and supersede this information.
We incorporate by reference:
(1) Our Annual Report on Form 10-K for the fiscal year ended
December 31, 1999;
(2) The description of our common stock contained in our
Registration Statement on Form 8-A filed on March 8, 1984,
as amended July 25, 1988;
(3) The description of our redeemable common stock purchase
warrants contained in our Registration Statement on Form
S-2, as amended (File No. 333-90731); and
(4) Future filings we make with the SEC under Section 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act prior to
the termination of this offering.
You may obtain a copy of these filings without charge by writing or
calling us at:
Radyne ComStream Inc.
3138 East Elwood Street
Phoenix, Arizona 85034
(602) 437-9620
You should rely only on the information incorporated by reference or
provided in this prospectus. We have not authorized anyone else to provide you
with different information. We are not making an offer to sell these securities
or soliciting an offer to buy these securities in any state where the offer or
sale is not permitted. You should not assume that the information in this
prospectus or the documents we have incorporated by reference is accurate as of
any date other than the date on the front of those documents.
CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements that address
numerous matters, including the following:
- - trends we believe may affect our business, financial condition or
results of operations;
- - factors that determine demand for our products;
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- - advantages we believe will help us compete effectively;
- - our strategies concerning the expansion of our operations; and
- - our plans to integrate our ComStream Holdings acquisition and grow the
business we acquired.
These forward-looking statements may be found in "Prospectus Summary," "Risk
Factors," and elsewhere in this prospectus or in the documents we incorporate by
reference in this prospectus. In some cases you can identify forward-looking
statements by terminology including "believes," "anticipates," "expects,"
"estimates," "may," "should," "could," "plans," "predicts," "potential,"
"continue," or similar terms.
Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements. The forward-looking statements
involve known and unknown risks, uncertainties and other factors that may cause
actual results to be materially different from any future results expressed or
implied by the forward-looking statements. These factors include those listed
under "Risk Factors" and elsewhere in this prospectus or in the documents we
incorporate by reference in this prospectus. We undertake no duty to update any
of the forward-looking statements after the date of this prospectus, even if new
information becomes available or other events occur in the future. All
forward-looking statements contained in this prospectus are expressly qualified
in their entirety by this cautionary notice.
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PROSPECTUS SUMMARY
This summary is not complete and does not contain all of the
information that may be important to you. You should read the detailed
information appearing elsewhere in this prospectus, including the more detailed
information and financial statements and the notes to those statements contained
in the documents we have incorporated by reference.
OUR COMPANY
We design, manufacture, and sell equipment used in the ground-based
portion of satellite communication systems to receive data from, and transmit
data to, satellites. We also design, manufacture, and sell equipment used in
cable television systems. Our products are used in applications for telephone,
data, video and audio broadcast communications, private and corporate data
networks, Internet applications, and digital cable television. We serve
customers in over 80 countries, including customers in the television broadcast,
international telecommunications, Internet service provider, and private
communication networks industries, as well as the U.S. government.
Our products have been utilized in major communications systems
worldwide, including the following:
- The world's highest capacity domestic, digital
satellite telephone network -- PT Telkom, Indonesia.
- Italy's first digital telephone/data network --
Telespacio, Italian Railways.
- Colombia's first alternate telecommunications network
-- Americatel.
- Earth stations for the first international satellite
links in China, India, Pakistan, Brazil, Haiti, and
Zambia.
- The world's largest private satellite broadcast
network -- Reuters.
- International Cablecasting Technologies -- utilizing
40,000 digital audio broadcast receivers.
We believe that the demand for the types of products that we sell will
increase as factors such as worldwide economic development, governmental
policies aimed at improving the telecommunications infrastructure in developing
countries, and the globalization of commerce contribute to an increased
worldwide requirement for communications services. We believe these factors will
continue to drive demand for communications systems, including those based on
satellite technology.
We also believe we are well-positioned to capitalize on this increased
demand for satellite communications systems as a result of our ability to
leverage our competitive advantages, which include the following:
- Our experienced management group, which has extensive
technological and engineering expertise and excellent
customer relationships. The members of our management
team have an average of over 20 years of experience
in the satellite communications industry.
- Our expansive line of well-known, well-respected,
off-the-shelf, state-of-the-art equipment that
enables us to meet our customers' requirements.
- Our ability to custom design products for our
customers' special applications and to provide a
one-stop shopping option to our customers.
- Our ability to meet the complex satellite ground
communications systems requirements of our customers
in diverse political, economic, and regulatory
environments in various locations around the world.
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- Our worldwide sales and service organization with the
expertise to successfully conduct business
internationally through sales and service offices
staffed by our employees in most of our major markets
throughout the world, including Beijing, Singapore,
London, Jakarta, and Amsterdam.
- Our October 1998 acquisition of a significant
competitor, ComStream Holdings Inc., which:
- significantly expanded our product lines,
- enhanced our sales force,
- increased our market share, and
- increased our profitability.
MARKET OPPORTUNITY AND STRATEGY
We believe that growth in demand for ground-based satellite system
equipment is being driven by the growth of satellite-delivered communications
services. According to the Satellite Industry Indicators Survey: Selected 1998
Survey Results conducted by the Satellite Industry Association and Futron
Corporation, total revenues for providers of satellite communications services
grew at an 18% compound annual growth rate to $26.2 billion in 1998, from $21.2
billion in 1997 and $15.9 billion in 1996. The Satellite Industry Association
estimates that the global market for satellite ground equipment and integration
services was $15.2 billion in 1998.
We currently address a niche of the ground-based satellite equipment
market that our management estimates currently generates worldwide revenues of
$800 million. We intend to expand our share in this market by:
- targeting providers of broadcast communications services
worldwide,
- exploiting new applications for our existing satellite
technology,
- developing new products to exploit new market opportunities,
including products designed to address transmission
requirements for the Internet and digital television
industries,
- providing high-margin customized products to niche markets,
and
- pursuing future acquisitions of competitive or complementary
companies.
CORPORATE INFORMATION
Our corporate headquarters are located at 3138 E. Elwood Street,
Phoenix, Arizona 85034. Our telephone number is (602) 437-9620. We maintain an
Internet Website at www.radynecomstream.com. Information contained at our
Website is not a part of this prospectus.
INTRODUCTION TO THE OFFERING
In February 2000, we issued 2,760,000 units, each unit consisting of
one share of common stock and one redeemable common stock purchase warrant, in a
public offering registered under the Securities Act of 1933 (the "Public
Offering"). The purchase price for each unit was $7.00. Each redeemable warrant
entitles the holder to purchase one share of our common stock for $8.75 per
share. Our common stock is traded on the Nasdaq SmallCap Market under the symbol
"RADN" and our redeemable warrants are traded on the Nasdaq SmallCap Market
under the symbol "RADNW." In connection with the Public Offering, we also issued
an option to purchase 240,000 shares of our common stock to HD Brous & Co.,
Inc., the representative of the underwriters. As of April 18, 2000, 535,970 of
the warrants had been exercised.
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The redeemable warrants must be exercised before February 7, 2005 or
they will expire. Until the redeemable warrants either expire or are exercised,
we have the right to redeem them at a redemption price of $0.01 per warrant. In
order to exercise our right to redeem the warrants, we must give no less than 30
and no more than 60 days' advance written notice, and the following conditions
must be met:
- from the date our board of directors decides to redeem the
warrants until the redemption date, there must be a current
and effective registration statement covering the warrants and
the underlying shares,
- our common stock must be listed on the New York Stock
Exchange, the American Stock Exchange or either tier of the
Nasdaq Stock Market, and
- the closing sales price of our common stock as reported by
Nasdaq must equal or exceed $10.9375 per share on each of the
20 consecutive trading days ending not earlier than 5 days
prior to the date on which the warrants are called for
redemption.
We may not redeem the warrants prior to February 7, 2001, unless we
have obtained written consent from HD Brous & Co., as representative of the
underwriters, to redeem the warrants.
This prospectus relates to 2,760,000 shares of common stock underlying
the redeemable warrants issued in connection with the Public Offering, including
the shares underlying warrants issued pursuant to the underwriters'
over-allotment option, and 240,000 shares of common stock issuable upon exercise
of the representative's common stock purchase option.
The representative's common stock purchase option is exercisable at
165% of the public offering price of the units, or $11.55 per share of common
stock. This option will be exercisable for a period of four years beginning on
February 7, 2001. Under our agreement with the representative, the holders of
the option also have certain anti-dilution rights, which provide for adjustments
to the exercise price under specified circumstances, and registration rights
relating to the common stock issuable upon exercise of the option.
Assuming the exercise of all of the redeemable warrants included in the
Public Offering of the units, we will receive gross proceeds of approximately
$24,150,000. In addition, assuming the exercise of the representative's common
stock purchase option, we will receive additional gross proceeds of
approximately $2,772,000.
THE OFFERING
Securities Offered......... 3,000,000 shares of common stock, $0.002 par value.
Risk Factors ............ Investment in the common stock and redeemable warrants
involves significant risk. See "Risk Factors."
NASDAQ SmallCap Market symbols:
Common Stock................................RADN
Redeemable Common Stock
Purchase Warrants...........................RADNW
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RISK FACTORS
You should carefully consider the following risks before you decide to
buy our securities. If any of the following risks actually occur, our business,
financial condition or results of operations would likely suffer. As a result,
the trading price of our securities could decline, and you may lose all or part
of the money you paid to buy our securities.
WE HAVE A HISTORY OF OPERATING LOSSES, ONLY RECENTLY BECAME PROFITABLE, AND
COULD SUFFER FURTHER LOSSES IN THE FUTURE.
We have incurred significant operating losses since our inception.
Although we generated operating income of $4,037,000 and net earnings of
$2,306,000 for the year ended December 31, 1999, we incurred operating losses of
$13,362,000 during the year ended December 31, 1998, $1,080,000 during the year
ended December 31, 1997, $1,814,000 during the six months ended December 31,
1996 and $2,368,000 during the 12 months ended June 30, 1996. Although the
rights offering that we completed in December 1999 eliminated our stockholders'
deficit at September 30, 1999, our consolidated financial statements for the
year ended December 31, 1998 included a note stating that our operating losses,
working capital deficit, and stockholders' deficit at that time raised doubts
about our ability to operate as a going concern. We have never paid any cash
dividends on our capital stock and do not anticipate paying any cash dividends
in the foreseeable future. You should consider the possibility that we may incur
future operating losses. Our ability to expand our ground-based satellite
systems market, penetrate new markets, such as Internet-related products, and
generate additional revenues and future positive operating and net earnings
depends, in large part, on our ability to sell our products to existing and new
customers and the profitability of such sales. There can be no assurance that we
will generate significant additional revenue or report positive quarterly or
annual operating results. Based upon the matters set forth in this risk factor
and the other risk factors contained in this prospectus, you should not invest
in our securities unless you can afford to lose your entire investment.
WE HAVE DEPENDED ON OUR CONTROLLING SHAREHOLDER FOR CAPITAL, AND WE HAVE
SIGNIFICANT SHORT-TERM LOANS THAT COULD LEAD TO A CASH SHORTAGE.
To meet our working capital requirements, we have depended on a
succession of short-term loans from, and purchases of our common stock by,
Singapore Technologies Pte Ltd. and its affiliates (collectively, "ST") since we
emerged from Chapter 11 protection on December 16, 1994. Prior to its
acquisition by us, ComStream depended on borrowings facilitated by its parent
company, Spar Aerospace Limited. ST has no obligation to continue to provide us
with any financing and you should not assume that ST will provide us with any
future financing.
We have a $20,500,000 uncommitted bank line of credit on which we owed
approximately $5,500,000 as of March 31, 2000. All loans pursuant to the bank
line of credit are short-term loans with maturities no later than September 28,
2000. The bank could demand repayment at any time after the loans mature, in
which case we might have to use the proceeds of this offering and seek
additional sources of financing to repay our line of credit. The use of the
proceeds of this offering to repay our bank debt instead of funding our research
and development program would adversely affect our growth strategy. If we are
required to seek additional sources of financing to repay our line of credit,
such financing may not be available on terms that we consider acceptable or may
not be available in sufficient amounts to enable us to repay our obligations to
the bank. Any of these circumstances would have a material and adverse impact on
our business, financial condition, and results of operations.
We believe the bank's willingness to provide us with this line of
credit is based in part on the bank's relationship with ST. ST has provided the
bank with a letter of awareness of our debt in which ST states it (1) will
endeavor to ensure that we utilize sound financial and business practices in our
operations and (2) will give the bank at least 60 days' prior written notice of
any divestment of our shares held by ST. ST has not, however, guaranteed our
indebtedness to the bank and is under no obligation to do so or to otherwise
satisfy our debts if we fail to repay them when due. Additionally, ST has no
obligation to and may not continue indefinitely to provide assurances to our
lender or otherwise assist us in maintaining such financing.
Our current credit agreement with our bank expires on September 28,
2000. We cannot assure you that a renewal agreement will be executed, when the
current agreement expires. If a renewal agreement is not executed
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the bank is likely to demand repayment of our loan. If we are required to repay
the loan it would have a material adverse impact on our financial condition.
WE DEPEND ON INTERNATIONAL SALES, WHICH COULD CAUSE OUR SALES LEVELS TO BE
VOLATILE.
Our export sales were approximately 56% of our net sales for the year
ended December 31, 1997, 50% of our net sales for the year ended December 31,
1998 and 56% of our net sales for the year ended December 31, 1999. According to
DTT Consulting, a satellite industry consulting and research firm, there has
been significant growth in the use of satellites for Internet traffic in recent
years. This growth has been centered on connecting Internet service providers,
or ISPs, with Internet servers. ISPs rarely use satellites to provide
point-to-point infrastructure for the Internet in the United States and, thus,
we expect that our sales to this market will be primarily to customers located
outside the United States. We anticipate that foreign sales will continue to
account for a significant portion of our revenue in the near future. Our foreign
sales are denominated in U.S. dollars. As a result, any decrease in the value of
foreign currencies relative to the U.S. dollar may adversely affect the demand
for our products by increasing their costs in the currency of those countries.
For example, the economic crisis in the Pacific Rim region and other
international markets decreased our bookings from these regions and adversely
affected our results of operations in the fourth quarter of 1998 and throughout
1999. We expect these negative trends to continue in the near future.
Additional risks in the international marketplace include the
following:
- changing regulatory requirements,
- the availability of export licenses,
- political and economic instability,
- difficulties in staffing and managing foreign
operations,
- tariffs and other trade barriers,
- complex foreign laws and treaties, and
- difficulty of collecting foreign account receivables.
In addition, we are subject to the Foreign Corrupt Practices Act, which
prohibits us from making payments to government officials and others in order to
influence the granting of contracts we may be seeking. Our non-U.S. competitors
are not subject to this law and this may give them a competitive advantage over
us.
A DOWNTURN IN THE RAPIDLY EVOLVING TELECOMMUNICATIONS AND INTERNET INDUSTRIES
COULD HARM OUR BUSINESS.
Our success depends upon the continued growth of the telecommunications
industry, particularly with regard to the Internet. The global
telecommunications and Internet industries are evolving rapidly, and the
potential growth rates or future trends in technology development are
unpredictable. We cannot provide assurance that the deregulation, privatization
and economic globalization of the worldwide telecommunications market that has
resulted in demand for technologies and services will continue in a manner
favorable to us or our business strategies. In addition, there is no assurance
that the growth in demand for Internet services and the resulting need for
high-speed or enhanced telecommunications products will continue at its current
rate or at all.
WE DEPEND ON DEVELOPING MARKETS AND THEIR UNCERTAIN GROWTH POTENTIAL COULD
RESULT IN LOSSES.
We believe a substantial portion of the growth in demand for our
products will depend upon customers in developing countries. We cannot provide
assurance that such increases in demand will occur or that prospective customers
will accept our products. The degree to which we are able to penetrate potential
markets in developing countries will be affected to a large extent by the speed
with which other competing elements of the communications infrastructure, such
as other satellite-delivered solutions, telephone lines, television cable, and
land-based solutions,
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are installed in developing countries in which we sell our products. The failure
to increase the sales of our products in developing countries would have a
material adverse effect on our business, financial condition, and results of
operations.
THE LOSS OF THE SERVICES OF ANY MEMBER OF OUR SENIOR MANAGEMENT OR THE INABILITY
TO ATTRACT OR RETAIN ADDITIONAL TECHNICAL PERSONNEL COULD IMPAIR OUR ABILITY TO
CONDUCT AND EXPAND OUR BUSINESS.
Our future performance depends significantly on Robert C. Fitting, our
Chief Executive Officer, and Steve Eymann, our Executive Vice President and
Chief Technical Officer. Under the respective employment agreements we have with
each of Messrs. Fitting and Eymann, they will serve as our Chief Executive
Officer and our Executive Vice President, respectively, until the earlier of
June 30, 2000 or such time as our adjusted earnings before interest and taxes
exceeds $6,000,000 for a period of four calendar quarters. The loss of either of
these key employees would adversely affect our operations.
Our continued ability to attract and retain highly skilled personnel
also is critical to the operation and expansion of our business. The market for
skilled engineers and other technical personnel is extremely competitive, and
recruitment and retention costs are high. Although we have been able to attract
and retain the personnel necessary to operate our business, we may not be able
to do so in the future, particularly as we expand our business into
Internet-related products and other markets. The failure to attract and retain
personnel with the necessary skills when needed could materially and adversely
affect our business and expansion plans.
COMPETITION IN OUR INDUSTRY IS INTENSE AND CAN LEAD TO REDUCED SALES AND MARKET
SHARE.
The markets for ground segment systems are highly competitive. We have
a number of major competitors in the satellite communications equipment field.
These include large companies, such as Hughes Network Systems, Inc., NEC, and
Adaptive Broadband Corp. (formerly California Microwave), which have
significantly larger and more diversified operations and greater financial,
marketing, personnel and other resources than we possess. As a result, these
competitors may develop and expand their products more quickly, adapt more
quickly to new or emerging technologies and changes in customer requirements,
take advantage of acquisition and other opportunities more readily, and devote
greater resources to the marketing and sale of their products than we can.
We believe that the quality, performance and capabilities of our
products, our ability to customize certain network functions, and the relatively
lower overall cost of our products, as compared to the costs of the products
generally offered by our major competitors, have contributed to our ability to
compete. Most of our competitors offer products that have one or more features
or functions similar to those that we offer. Competition from current
competitors or future entrants in the markets in which we compete could cause us
to lose orders or customers or could force us to lower the prices we charge for
our products, all of which would have a material adverse impact on our business,
financial condition, and results of operations.
OUR PRODUCTS MAY BECOME OBSOLETE DUE TO RAPID TECHNOLOGICAL CHANGE.
The telecommunications industry, including the ground-based satellite
communications systems business, is characterized by rapid and continuous
technological change. Future technological advances in the telecommunications
industry may result in the introduction of new products or services that compete
with our products or render them obsolete. Our success depends in part on our
ability to respond quickly to technological changes through the improvement of
our current products and the development of new products. Accordingly, we
believe that we will need to allocate a substantial amount of capital to
research and development activities in the future. We may not generate cash flow
from operations or have access to outside financing in amounts that are
sufficient to adequately fund the development of new products. Even if we are
able to obtain the required funding to develop new products, we cannot assure
you that we will be able to develop products that we will be able to sell
successfully. Our inability to improve our existing products and develop new
products could have a material adverse effect on our business, financial
condition, and results of operations.
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THE HIGH COST OF RESEARCH AND DEVELOPMENT REDUCES OUR PROFITABILITY.
Our future growth depends on penetrating new markets, adapting existing
satellite communications products to new applications, and introducing new
communications products that achieve market acceptance and benefit from our
established international distribution channels. Accordingly, we are actively
applying our communications expertise to design and develop new hardware and
software products and enhance existing products. We expended $9,127,000 in the
year ended December 31, 1999 on research and development activities. This
represents 16% of our net sales for the year ended December 31, 1999.
Additionally, our research and development program may not produce successful
results, which would have a material adverse effect on our business, financial
condition, and results of operations.
RAPID GROWTH COULD STRAIN OUR PERSONNEL AND SYSTEMS.
Our operations have expanded significantly as a result of our
acquisition of ComStream. In order to pursue successfully the opportunities
presented by the ground segment and emerging satellite-delivered communications
and Internet/intranet-infrastructure markets, we will be required to continue to
expand our operations. This expansion could place a significant strain on our
personnel, management, and financial and other resources. In order to manage any
future growth effectively, we will be required to:
- attract, train, motivate, and manage a significantly larger
number of employees;
- conduct product engineering and management, sales and
marketing efforts, and customer support activities; and
- manage higher capital requirements.
Any failure to manage any further growth in an efficient manner and at
a pace consistent with our business could have a material adverse effect on our
growth and our business, financial condition, and results of operations.
OUR PRODUCTS COULD INFRINGE ON THE INTELLECTUAL PROPERTY OF OTHERS.
We rely on our proprietary technology and intellectual property to
maintain our competitive position. Unauthorized parties could attempt to copy
aspects of our technologies or to obtain information that we regard as
proprietary. We may not be able to police unauthorized use of our intellectual
property. Our failure to protect our proprietary technology and intellectual
property could adversely affect our competitive position.
We generally rely on confidentiality agreements with our employees and
some of our suppliers to protect our proprietary technology. We also control
access to and distribution of confidential information concerning our
proprietary technology. We cannot guarantee that the other parties to these
agreements will not disclose or misappropriate the confidential information
concerning our proprietary technology, which could have a material adverse
effect on our business.
We rely on patents to protect certain of our proprietary technology.
Patents, however, often provide only narrow protection that may not prevent
competitors from developing products that function in a manner similar to those
covered by our patents. In addition, some foreign countries in which we sell our
products do not provide the same level of protection to intellectual property as
the laws of the United States provide. We cannot assure you that any patents we
currently own or control, or that we may acquire in the future, will prevent our
competitors from independently developing products that are substantially
similar or superior to ours.
Third parties may in the future assert that our technology violates
their intellectual property rights. As a result of such claims, we could be
required to enter into licensing arrangements or develop non-infringing
products, which could be prohibitively expensive or could divert a significant
amount of resources from other aspects of our business.
9
<PAGE> 13
We may find it necessary to take legal action in the future to enforce
or protect our intellectual property rights or to defend against claims that our
products or technologies infringe the rights of third parties. Litigation can be
very expensive and can distract our management's time and attention, which could
adversely affect our business. In addition, we may not be able to obtain a
favorable outcome in any intellectual property litigation.
WE DEPEND UPON CERTAIN SUPPLIERS AND SUBCONTRACTORS, THE LOSS OF WHICH COULD
CAUSE AN INTERRUPTION IN THE PRODUCTION OF OUR PRODUCTS.
We rely on subcontractors to assemble and test some of our products.
Additionally, our products use a number of specialized chips and customized
components or subassemblies produced by a limited number of suppliers. We
maintain limited inventories of these products and do not have long-term supply
contracts with our vendors. In the event our subcontractors or suppliers are
unable or unwilling to fulfill our requirements, we could experience an
interruption in product availability until we are able to secure alternative
sources of supplies. We are also subject to price increases by suppliers that
could increase the cost of our products or require us to develop alternative
suppliers, which could interrupt our business. It may not be possible to obtain
alternative sources at a reasonable cost. Supply interruptions could cause us to
lose orders or customers, which would result in a material adverse impact on our
business, financial condition, and results of operations.
OUR QUARTERLY OPERATING RESULTS HAVE FLUCTUATED SIGNIFICANTLY IN THE PAST, AND
WE ANTICIPATE THAT THEY COULD DO SO IN THE FUTURE, WHICH COULD ADVERSELY AFFECT
OUR STOCK PRICE.
We may continue to experience significant quarter to quarter
fluctuations in our operating results, which may result in volatility in the
price of our common stock. These fluctuating operating results result from a
variety of factors, including the following:
- timing of the initiation and completion of our purchase
orders,
- demand for our products,
- introduction of new or enhanced products by us or our
competitors,
- growth of demand for Internet-based products and services in
developing countries,
- timing of significant marketing programs we may implement,
- extent and timing of hiring additional personnel,
- competitive conditions in our industry, and
- general economic conditions in the United States and abroad.
THE OWNERSHIP INTEREST OF OUR CONTROLLING SHAREHOLDER MAY MAKE OUR STOCK LESS
ATTRACTIVE TO INVESTORS AND POTENTIAL ACQUIRORS.
ST owns a majority of our outstanding common stock. ST will, therefore,
continue to have the ability to elect all of our directors and to control the
outcome of all issues submitted to a vote of our stockholders. It also would be
impossible for a third party to acquire us without the consent or participation
of ST. ST has signed a lock-in agreement required by certain state regulatory
authorities that could, in certain circumstances, reduce the proceeds receivable
by ST in the event of a sale or merger of our company during the term of the
lock-in agreement. The lock-in agreement is for a term of two years, unless
earlier terminated as provided in the agreement. This requirement might make ST
less likely to consent to any sale or merger of our company during the term of
this lock-in agreement.
10
<PAGE> 14
OUR OUTSTANDING OPTIONS AND WARRANTS MAY DILUTE OUR STOCKHOLDERS' INTERESTS AND
COULD HINDER US FROM OBTAINING ADDITIONAL FINANCING.
We grant options and warrants to purchase shares of common stock to
employees, directors and others with business relationships with us. To the
extent that outstanding options and warrants are exercised, our stockholders'
interests will be diluted. Also, we may not be able to obtain additional equity
capital on acceptable terms, because the holders of the outstanding options and
warrants will likely exercise them at a time when we may be able to obtain such
capital on better terms than those under the options and warrants.
OUR REDEMPTION OF REDEEMABLE WARRANTS MAY HAVE AN ADVERSE EFFECT ON THE HOLDERS
OF THE WARRANTS.
We have the right to redeem all, but not less than all, of the
redeemable warrants under certain conditions. Redemption of the redeemable
warrants could encourage holders to exercise them and pay the exercise price at
a time when it may be disadvantageous for the holders to do so, to sell the
redeemable warrants at the current market price when they might otherwise wish
to hold the redeemable warrants or to accept the redemption price, which may be
substantially less than the market value of the redeemable warrants at the time
of redemption. The holders of the redeemable warrants will automatically forfeit
their rights to purchase the shares of common stock issuable upon exercise of
those warrants unless the warrants are exercised before they are redeemed. The
holders of redeemable warrants will not possess any rights as stockholders
unless and until the redeemable warrants are exercised.
THE REDEEMABLE WARRANTS MAY BE DEPRIVED OF ANY VALUE IF A PROSPECTUS COVERING
THE SHARES OF COMMON STOCK ISSUABLE UPON THEIR EXERCISE IS NOT KEPT EFFECTIVE
AND CURRENT, OR IF THE UNDERLYING SHARES OF COMMON STOCK ARE NOT, OR CANNOT BE,
REGISTERED IN THE APPLICABLE STATES.
As a holder of redeemable warrants you will have the right to exercise
the redeemable warrants to acquire shares of common stock only if there is a
current and effective registration statement and prospectus covering the shares
of common stock issuable upon their exercise, and only if the shares are
qualified for sale, or exempt from qualification, under the securities laws of
the applicable state or states. We may incur substantial expense in maintaining
a current effective registration statement and prospectus, and we cannot assure
you that a current registration statement and prospectus will be in effect when
you may want to exercise your redeemable warrants. The redeemable warrants may
be deprived of any value if a prospectus covering the shares issuable upon their
exercise is not kept effective and current, or if the underlying shares are not,
or cannot be, registered in the applicable states.
STOCK PRICES OF TECHNOLOGY COMPANIES HAVE FLUCTUATED WIDELY IN RECENT MONTHS AND
THE TRADING PRICE OF OUR COMMON STOCK AND REDEEMABLE WARRANTS IS LIKELY TO BE
VOLATILE, WHICH COULD RESULT IN SUBSTANTIAL LOSSES TO INVESTORS.
The trading price of our common stock and redeemable warrants could
become more volatile and could fluctuate widely in response to factors including
the following, some of which are beyond our control:
- variations in our operating results,
- announcements of technological innovations or new services by
us or our competitors,
- changes in expectations of our future financial performance,
including financial estimates by securities analysts and
investors,
- changes in operating and stock price performance of other
technology companies similar to us,
- conditions or trends in the technology industry,
- additions or departures of key personnel, and
- future sales of our common stock.
11
<PAGE> 15
Domestic and international stock markets often experience significant
price and volume fluctuations. These fluctuations, as well as general economic
and political conditions unrelated to our performance, may adversely affect the
price of our common stock and redeemable warrants.
THE LARGE NUMBER OF SHARES ELIGIBLE FOR FUTURE SALE MAY ADVERSELY AFFECT THE
MARKET PRICE OF OUR COMMON STOCK.
A large number of our issued and outstanding shares of common stock are
eligible for future sale. The sale, or availability for sale, of a substantial
number of shares of common stock in the public market could materially adversely
affect the market price of our common stock and could impair our ability to
raise additional capital through the sale of our equity securities.
NASDAQ COULD DELIST OUR COMMON STOCK OR REDEEMABLE WARRANTS, WHICH COULD MAKE IT
MORE DIFFICULT FOR YOU TO SELL OR OBTAIN QUOTATIONS AS TO THE PRICE OF OUR
COMMON STOCK OR REDEEMABLE WARRANTS.
In order to continue to be listed on Nasdaq, we must meet the following
requirements:
- net tangible assets of at least $2,000,000, or a market
capitalization of $35,000,000 or $500,000 in net earnings for
two of the last three years,
- a minimum bid price of $1.00,
- two market makers,
- 300 stockholders,
- at least 500,000 shares in the public float or a minimum
market value for the public float of $1,000,000, and
- compliance with certain corporate governance standards.
If we cannot satisfy Nasdaq's maintenance criteria in the future,
Nasdaq could delist our common stock or redeemable warrants. In the event of
delisting, trading, if any, would be conducted only in the over-the-counter
market in the so-called "pink sheets" or the NASD's Electronic Bulletin Board.
As a result of any delisting, an investor would likely find it more difficult to
sell or obtain quotations as to the price of our common stock or redeemable
warrants.
WE HAVE PROVISIONS IN OUR CERTIFICATE OF INCORPORATION THAT SUBSTANTIALLY
ELIMINATE THE PERSONAL LIABILITY OF MEMBERS OF OUR BOARD OF DIRECTORS FOR
VIOLATIONS OF THEIR FIDUCIARY DUTY OF CARE AS A DIRECTOR AND THAT ALLOW US TO
INDEMNIFY OUR OFFICERS AND DIRECTORS. THIS COULD MAKE IT VERY DIFFICULT FOR YOU
TO BRING ANY LEGAL ACTIONS AGAINST OUR DIRECTORS FOR SUCH VIOLATIONS OR COULD
REQUIRE US TO PAY ANY AMOUNTS INCURRED BY OUR DIRECTORS IN ANY SUCH ACTIONS.
Pursuant to our certificate of incorporation, members of our Board of
Directors will have no liability for violations of their fiduciary duty of care
as a director, except in limited circumstances. This means that you may be
unable to prevail in a legal action against our directors even if you believe
they have breached their fiduciary duty of care. In addition, our certificate of
incorporation allows us to indemnify our directors from and against any and all
expenses or liabilities arising from or in connection with their serving in such
capacities with us. This means that if you were able to enforce an action
against our directors or officers, in all likelihood we would be required to pay
any expenses they incurred in defending the lawsuit and any judgment or
settlement they otherwise would be required to pay.
12
<PAGE> 16
SINCE SOME MEMBERS OF OUR BOARD OF DIRECTORS ARE NOT RESIDENTS OF THE UNITED
STATES AND CERTAIN OF OUR ASSETS ARE LOCATED OUTSIDE OF THE UNITED STATES, YOU
MAY NOT BE ABLE TO ENFORCE ANY U.S. JUDGMENT FOR CLAIMS YOU MAY BRING AGAINST
SUCH DIRECTORS OR ASSETS.
Two members of our board of directors are residents of Singapore, and
an immaterial portion of our assets and a substantial portion of the assets of
these directors are located outside the United States. As a result, it may be
more difficult for you to enforce a lawsuit within the United States against
these non-U.S. residents than if they were residents of the United States. Also,
it may be more difficult for you to enforce any judgment obtained in the United
States against our assets or the assets of our non-U.S. resident directors
located outside the United States than if these assets were located within the
United States. We cannot assure you that foreign courts would enforce:
- liabilities predicated on U.S. federal securities laws in
original actions commenced in such foreign jurisdiction; or
- judgments of U.S. courts obtained in actions based upon the
civil liability provisions of U.S. federal securities laws.
PARTIES ON WHICH WE RELY MAY HAVE YEAR 2000 TECHNOLOGY PROBLEMS THAT COULD
DISRUPT OUR BUSINESS.
The Year 2000 issue concerns the fact that certain computer systems and
processors may recognize the designation "00" as 1900 when it is intended to
mean 2000, resulting in system failure or miscalculations. To date, we have not
encountered any significant problems in our information technology systems or
non-information technology systems related to the Year 2000 issue, but we cannot
assure you that we will not encounter such problems in the future. In addition,
we have not encountered any significant problems with our vendors related to the
Year 2000 issue, but we cannot assure you that we will not encounter such
problems in the future.
USE OF PROCEEDS
We may receive proceeds from the following:
1. up to approximately $24,150,000 assuming the exercise of all
of the redeemable warrants issued in the Public Offering,
including those issued pursuant to the underwriters'
over-allotment option; and
2. up to approximately $2,772,000 assuming the exercise of the
representative's common stock purchase option.
If we receive any proceeds we will use them for working capital and
general corporate purposes.
PLAN OF DISTRIBUTION
We will issue the shares of common stock to redeemable warrant holders
upon our receipt of the underlying warrant certificate, together with the
exercise price for the warrants, and to the representative or its assigns upon
our receipt of the underlying common stock purchase option, together with the
option exercise price. There can be no assurance that any of the redeemable
warrants will be exercised or that the representative will exercise its common
stock purchase option to acquire shares of our common stock.
LEGAL MATTERS
The validity of the shares of common stock offered hereby has been
passed upon for us by Dorsey & Whitney LLP, special New York counsel.
13
<PAGE> 17
EXPERTS
The consolidated financial statements of Radyne ComStream Inc. and
subsidiaries as of December 31, 1999 and 1998 and for the years then ended,
which are contained in our Annual Report on Form 10-K for the fiscal year ended
December 31, 1999, have been incorporated by reference herein and in the
registration statement in reliance upon the report of KPMG LLP, independent
certified public accountants, incorporated by reference herein upon the
authority of said firm as experts in accounting and auditing.
The consolidated financial statements of Radyne ComStream Inc. and
subsidiaries for the fiscal year ended December 31, 1997, which are contained in
our Annual Report on Form 10-K for the fiscal year ended December 31, 1999 and
incorporated by reference in this prospectus, have been audited by Deloitte &
Touche LLP, independent public accountants, as indicated in their reports with
respect thereto, and are included herein in reliance upon the authority of said
firm as experts in accounting and auditing.
14
<PAGE> 18
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. WE HAVE
NOT AUTHORIZED ANY OTHER PERSON TO PROVIDE YOU WITH DIFFERENT INFORMATION. IF
ANYONE PROVIDES YOU WITH DIFFERENT OR INCONSISTENT INFORMATION, YOU SHOULD NOT
RELY ON IT. WE ARE NOT MAKING AN OFFER TO SELL THESE SECURITIES IN ANY
JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. YOU SHOULD ASSUME THAT
THE INFORMATION APPEARING IN THIS PROSPECTUS IS ACCURATE AS OF THE DATE ON THE
FRONT COVER OF THIS PROSPECTUS ONLY. OUR BUSINESS, FINANCIAL CONDITION, RESULTS
OF OPERATIONS AND PROSPECTS MAY HAVE CHANGED SINCE THAT DATE.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
WHERE YOU CAN FIND MORE INFORMATION.............. 1
INCORPORATION OF CERTAIN DOCUMENTS
BY REFERENCE............................ 1
CAUTIONARY NOTICE REGARDING
FORWARD-LOOKING STATEMENTS.............. 1
PROSPECTUS SUMMARY............................... 3
RISK FACTORS..................................... 6
USE OF PROCEEDS.................................. 13
PLAN OF DISTRIBUTION............................. 13
LEGAL MATTERS.................................... 13
EXPERTS ........................................ 14
</TABLE>
3,000,000 SHARES
COMMON STOCK
RADYNE
COMSTREAM INC.
--------------------
PROSPECTUS
--------------------
_____________, 2000
<PAGE> 19
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by us in connection with the
sale of securities being registered, including costs and expenses we previously
paid in connection with our registration statement on Form S-2 relating to the
units we sold in our February 2000 public offering. All amounts are estimates
except the SEC registration fee.
<TABLE>
<S> <C>
SEC registration fee..............................................................$9,169
NASD filing fee .................................................................9,083
Legal fees and expenses..........................................................433,515
Listing fees ...................................................................8,816
Blue Sky legal and filing fees....................................................44,445
Accounting fees and expenses.....................................................112,450
Transfer and Warrant Agents' fees..................................................9,231
Printing and engraving expenses..................................................136,615
Miscellaneous.....................................................................46,512
TOTAL...........................................................................$809,836
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
New York Business Corporation Law, Article 7, enables a corporation in
its original certificate of incorporation, or an amendment thereto validly
approved by shareholders, to eliminate or limit personal liability of members of
its Board of Directors for violations of a director's fiduciary duty of care.
However, the elimination or limitation shall not apply where there has been bad
faith, intentional misconduct or a knowing violation of law, the payment of a
dividend or approval of a stock repurchase which is deemed illegal, any other
violation of Section 719 of the New York Business Corporation Law, or a
financial profit or other advantage to which the director was not legally
entitled. Radyne ComStream's Certificate of Incorporation includes the following
language:
"SEVENTH: A director of the Corporation shall not be
personally liable to the Corporation or its shareholders for damages
for any breach of duty as a director; provided that, except as
hereinafter provided, this Article SEVENTH shall neither eliminate nor
limit liability: (a) if a judgment or final adjudication adverse to the
director establishes that (i) the director's acts or omissions were in
bad faith or involved intentional misconduct or a knowing violation of
law, (ii) the director personally gained in fact a financial profit or
other advantage to which the director was not legally entitled, or
(iii) the director's acts violated Section 719 of the New York Business
Corporation Law; or (b) for any act or omission prior to the
effectiveness of this Article SEVENTH. If the Corporation hereafter may
by law be permitted to further eliminate or limit the personal
liability of directors, then pursuant hereto the liability of a
director of the Corporation shall, at such time, automatically be
further eliminated or limited to the fullest extent permitted by law.
Any repeal of or modification to the provisions of this Article SEVENTH
shall not adversely affect any right or protection of a director of the
Corporation existing pursuant to this Article SEVENTH immediately prior
to such repeal or modification.
EIGHTH: The Corporation may, to the fullest extent permitted
by Sections 721 through 726 of the Business Corporation Law of New
York, indemnify any and all directors and officers whom it shall have
power to indemnify under the said sections from and against any and all
of the expenses, liabilities or other matters referred to in or covered
by such section of the Business Corporation Law, and the
indemnification provided for herein shall not be deemed exclusive of
any other rights to which the persons so indemnified may be entitled
under any By-Law, agreement, vote of shareholders or disinterested
directors or otherwise, both as to action in his/her official capacity
and as to action in another capacity by holding such office, and shall
continue as to a person who has ceased to be a director or officer and
shall inure to the benefit of the heirs, executors and administrators
of such a person."
II-1
<PAGE> 20
ITEM 16. EXHIBITS.
(a) The following exhibits are filed herewith:
EXHIBIT NO.
- -----------
2.1* -- Stock Purchase Agreement, dated August 28, 1998, between
Spar Aerospace Limited and Radyne ComStream Inc.
4.1** -- Form of Common Stock Certificate
4.2** -- Form of Warrant Agreement
4.3** -- Form of Warrant Certificate
4.4** -- Form of Representative's Purchase Option
4.5** -- Form of Lock-Up Agreement
4.7** -- Form of promotional shares lock-in agreement between Radyne
ComStream Inc. and each of Stetsys Pte Ltd, Stetsys US
Inc., Robert Fitting, Steven Eymann and Garry Kline.
5.1 -- Opinion of Dorsey & Whitney LLP
23.1 -- Consent of KPMG LLP
23.2 -- Consent of Deloitte & Touche LLP
23.3 -- Consent of Dorsey & Whitney LLP (included in Exhibit 5.1)
24.1 -- Power of Attorney (included on signature page)
- ---------
* Incorporated by reference to our Current Report on Form 8-K filed
August 28, 1998.
** Incorporated by reference to the identically numbered Exhibit to our
Registration Statement on Form S-2 filed as of November 12, 1999, as
amended by Amendment No. 1 filed as of January 12, 2000, Amendment No.
2 filed as of January 24, 2000 and Amendment No. 3 filed as of February
7, 2000 (File No. 333-90731).
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers of sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(30) of
the Securities Act of 1933;
(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 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
II-2
<PAGE> 21
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3, Form S-8 or Form F-3, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by the
registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the registration statements.
(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.
(4) The undersigned registrant hereby undertakes that, for the 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 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(5) The undersigned registrant hereby undertakes to supplement the
prospectus, after the expiration of the subscription period, to set forth the
results of the subscription offer and the terms of any subsequent reoffering
thereof.
(6) 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.
(7) 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.
II-3
<PAGE> 22
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 Phoenix, state of Arizona on April 26, 2000.
RADYNE COMSTREAM INC.
By: /s/ ROBERT C. FITTING
----------------------------------
ROBERT C. FITTING,
CHIEF EXECUTIVE OFFICER
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Robert C. Fitting and Garry D. Kline and
each of them, his attorneys-in-fact, each with the power of substitution, for
him and in his name, place and stead, in any and all capacities, to sign any and
all amendments (including post-effective amendments) to this Registration
Statement, and sign any registration statement for the same offering covered by
this Registration Statement that is to be effective upon filing pursuant to Rule
462(b) promulgated under the Securities Act of 1933, as amended, and all
post-effective amendments thereto, and to file the same, with all exhibits
thereto and all documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, and each
of them, full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that such attorneys-in-fact and agents or any of them, 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, 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/ ROBERT C. FITTING Chief Executive Officer and Director April 26, 2000
- -----------------------------------
ROBERT C. FITTING (Principal Executive Officer)
/s/ BRIAN DUGGAN President April 26, 2000
- -----------------------------------
BRIAN DUGGAN
/s/ GARRY D. KLINE Vice President-Finance, Chief Financial April 26, 2000
- -----------------------------------
GARRY D. KLINE Officer and Secretary (Principal Financial and
Accounting Officer)
/s/ ROBERT A. GRIMES* Director April 26, 2000
- -----------------------------------
ROBERT A. GRIMES
/s/ MING SEONG LIM* Chairman of the Board of Directors April 26, 2000
- -----------------------------------
MING SEONG LIM
/s/ YIP LOI LEE* Director April 26, 2000
- -----------------------------------
YIP LOI LEE
/s/ KUM CHUEN TANG* Director April 26, 2000
- -----------------------------------
KUM CHUEN TANG
/s/ DENNIS ELLIOTT* Director April 26, 2000
- -----------------------------------
DENNIS ELLIOTT
/s/ JERRY WAYLAN Director April 26, 2000
- -----------------------------------
JERRY WAYLAN
*By: /s/ ROBERT C. FITTING
- -----------------------------------
Attorney-in-fact
</TABLE>
II-4
<PAGE> 23
EXHIBIT INDEX
EXHIBIT NO.
- -----------
5.1 -- Opinion of Dorsey & Whitney LLP
23.1 -- Consent of KPMG LLP
23.2 -- Consent of Deloitte & Touche LLP
23.3 -- Consent of Dorsey & Whitney LLP (included in Exhibit 5.1)
<PAGE> 1
EXHIBIT 5.1
[DORSEY & WHITNEY LLP]
JOHN B. WADE, III
(212) 415-9311
April 25, 2000
The Board of Directors
Radyne ComStream Inc.
3138 East Elwood Street
Phoenix, Arizona 85034
Ladies and Gentlemen:
We are acting as special New York counsel to Radyne ComStream, Inc., a
New York corporation (the "Company"), in connection with the validity of the
shares of the Company's common stock, $0.002 par value per share (the "Common
Stock") which are the subject of the Post-Effective Amendment No. 1 to
Registration Statement on Form S-2 (Securities and Exchange Commission File No.
333-90731), as amended, on Form S-3 (the "Registration Statement"), filed by the
Company under the Securities Act of 1933, as amended, and the rules and
regulations thereunder. The Registration Statement relates to the registration
of (i) 2,760,000 shares of Common Stock issuable upon exercise of the Company's
outstanding redeemable Common Stock Purchase Warrants (the "Warrants") and (ii)
240,000 shares of Common Stock issuable upon exercise of a certain option issued
to HD Brous & Co., as the representative of several underwriters (the
"Representative's Purchase Option").
As such counsel, we have reviewed the corporate proceedings of the
Company in connection with the Registration Statement and have also examined and
relied upon originals or copies, certified or otherwise authenticated to our
satisfaction of all such corporate records, documents, agreements, instruments
relating to the Company and certificates of public officials and of
representatives of the Company, and have also made such investigations of law
and have discussed with representatives of the Company and such other persons
such questions of fact, as we have deemed proper and necessary as a basis for
rendering this opinion.
Based upon, and subject to, the foregoing, we are of the opinion that:
(i) the shares of Common Stock issuable upon exercise of the Warrants
and the shares of Common Stock issuable upon exercise of the Representative's
Purchase Option have been duly authorized;
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(ii) the shares of Common Stock issuable upon exercise of the Warrants
pursuant to the terms thereof will be duly and validly issued, fully paid and
non-assessable; and
(iii) the shares of Common Stock issuable upon exercise of the
Representative's Purchase Option pursuant to the terms thereof will be validly
issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement. In giving the foregoing consent, we do not admit that we
are in the category of persons whose consent is required under Section 7 of the
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission promulgated thereunder.
Very truly yours,
/s/ Dorsey & Whitney LLP
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EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
The Board of Directors and Stockholders
Radyne ComStream Inc.:
We consent to the use of our reports incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the prospectus.
/s/ KPMG LLP
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Phoenix, Arizona
April 25, 2000
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EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Post-Effective Amendment
No. 1 on Form S-3 to the Registration Statement No. 333-90731 on Form S-2 of
Radyne ComStream Inc. (formerly Radyne Corp.) of our report dated February 4,
1998, incorporated by reference in the Annual Report on Form 10-K of Radyne
ComStream Inc. for the year ended December 31, 1999, and to the reference to us
under the heading "Experts" in the Prospectus, which is part of such
Registration Statement.
/s/ DELOITTE & TOUCHE LLP
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Phoenix, Arizona
April 25, 2000
