CINCINNATI MICROWAVE INC, POS AM, 1995-12-29

CINCINNATI MICROWAVE INC
POS AM, 1995-12-29
SEARCH, DETECTION, NAVAGATION, GUIDANCE, AERONAUTICAL SYS

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 13, 1995

REGISTRATION NO. 33-80628
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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POST-EFFECTIVE
AMENDMENT NO. 3
TO

FORM S-2
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
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CINCINNATI MICROWAVE, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S> <C>
OHIO 31-0903863
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
</TABLE>

ONE MICROWAVE PLAZA
CINCINNATI, OHIO 45249-8236
(513) 489-5400
(ADDRESS, INCLUDING ZIP CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICE)
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JACQUES A. ROBINSON
PRESIDENT AND CHIEF EXECUTIVE OFFICER
CINCINNATI MICROWAVE, INC.
ONE MICROWAVE PLAZA
CINCINNATI, OHIO 45249-8236
(513) 489-5400
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF AGENT FOR SERVICE)

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PLEASE SEND COPIES OF ALL COMMUNICATIONS TO:

NEIL GANULIN, ESQ.

FROST & JACOBS
201 EAST FIFTH STREET
CINCINNATI, OHIO 45202
(513) 651-6800

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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE REGISTRATION STATEMENT BECOMES EFFECTIVE.

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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, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /

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THIS POST-EFFECTIVE AMENDMENT NO. 3 TO THE REGISTRATION STATEMENT SHALL
BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(C)
OF THE SECURITIES ACT OF 1933, AS AMENDED, MAY DETERMINE.

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<PAGE> 2

CINCINNATI MICROWAVE, INC.
CROSS-REFERENCE SHEET SHOWING LOCATION IN PROSPECTUS
OF INFORMATION REQUIRED BY FORM S-2

<TABLE>
<CAPTION>
ITEM
NUMBER IN
FORM S-2
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<C> <S> <C>
1. Forepart of the Registration Statement
and Outside Front Cover Page of
Prospectus.............................. Facing Page; Outside Front Cover Page of
Prospectus; Cross-Reference Sheet.
2. Inside Front and Outside Back Cover
Pages of Prospectus..................... Inside Front and Outside Back Cover
Pages of Prospectus; Available
Information; Additional Information;
Incorporation of Documents by Reference;
Table of Contents.
3. Summary Information, Risk Factors and
Ratio of Earnings to Fixed Charges...... Prospectus Summary; Risk Factors;
Business.
4. Use of Proceeds......................... Use of Proceeds.
5. Determination of Offering Price......... Outside Front Cover Page.
6. Dilution................................ Dilution.
7. Selling Security Holders................ Inapplicable.
8. Plan of Distribution.................... Outside and Inside Front Cover Pages;
Plan of Distribution.
9. Description of Securities to be
Registered.............................. Description of Capital Stock and
Warrants.
10. Interests of Named Experts and
Counsel................................. Legal Matters; Experts.
11. Information with Respect to the
Registrant.............................. Front Cover Page; Prospectus Summary;
Price Range of Common Shares and
Warrants; Dividend Policy;
Capitalization; Selected Consolidated
Financial Data; Management's Discussion
and Analysis of Financial Condition and
Results of Operations.
12. Incorporation of Certain Information by
Reference............................... Incorporation of Documents by Reference.
13. Disclosure of Commission Position on
Indemnification for Securities Act
Liabilities............................. Inapplicable.
</TABLE>

<PAGE> 3

AMENDED PROSPECTUS

UP TO 1,073,620 COMMON SHARES

CINCINNATI MICROWAVE, INC.

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The 1,073,620 Common Shares being offered by Cincinnati Microwave, Inc.
(the "Company") pursuant to this Prospectus are issuable upon the exercise of
1,073,620 warrants issued and sold as a part of a rights offering, as described
below.

In December 1994, the Company offered for sale and sold (the "Offering" or
the "Rights Offering") 1,482,435 Units ("Units"), at $7.00 per Unit
("Subscription Price"), each Unit consisting of two of the Company's common
shares, without par value ("Common Shares"), and one warrant ("Warrant"). Each
Warrant entitles the holder thereof to purchase one Common Share at an exercise
price of $4.00 at any time prior to 5:00 p.m., Eastern Standard Time, on
December 31, 1998. As of November 1, 1995, there were 1,073,620 Warrants
outstanding, and a total of 408,815 Warrants had been exercised.

The Common Shares are traded over-the-counter and are quoted on the Nasdaq
National Market under the symbol "CNMW." On November 1, 1995, the closing price
of the Common Shares as reported on the Nasdaq National Market was $7.00 per
share. The Warrants are traded over-the-counter and are quoted on the Nasdaq
National Market under the symbol "CNMWW." On November 1, 1995, the closing price
of the Warrants as reported on the Nasdaq National Market was $4.625 per
Warrant.

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SEE "RISK FACTORS" ON PAGE 6 FOR A DISCUSSION OF CERTAIN MATERIAL FACTORS
THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT
IN THE COMMON SHARES OFFERED HEREBY.

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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.

The date of this Amended Prospectus is December 13, 1995.

<PAGE> 4

INCORPORATION OF DOCUMENTS BY REFERENCE

The following documents have been filed by the Company with the Commission
(File No. 0-13136) and are incorporated herein by reference:

(1) The Company's Annual Report on Form 10-K for the year ended December
25, 1994.

(2) The Company's Quarterly Reports on Form 10-Q for the periods ended
April 2, 1995, July 2, 1995, and October 1, 1995, respectively.

(3) The Company's Current Reports on Form 8-K, dates of report October 18,
1995 and December 5, 1995, respectively.

COPIES OF THE ABOVE DOCUMENTS (NOT INCLUDING THE EXHIBITS TO SUCH
DOCUMENTS, UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY REFERENCE IN
SUCH DOCUMENTS) AND OF THE COMPANY'S 1994 ANNUAL REPORT MAY BE OBTAINED UPON
REQUEST WITHOUT CHARGE FROM THE SECRETARY OF THE COMPANY, ONE MICROWAVE PLAZA,
CINCINNATI, OHIO 45249-8236 (TELEPHONE NUMBER (513) 489-5400).

<PAGE> 5

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information and financial data appearing elsewhere in or incorporated by
reference into this Amended Prospectus.

THE COMPANY

Cincinnati Microwave, Inc. designs, manufactures and markets ultrahigh
frequency and microwave wireless communications products. The Company's
principal product line since its inception has been radar warning detectors. The
Company has become a leader in the radar warning detector market by combining
its experience in ultrahigh frequency and microwave wireless technology,
including digital signal processing, with its high volume manufacturing
capabilities. In 1993, the Company introduced its first digital spread spectrum
cordless telephone and its first wireless data modem for use on Cellular Digital
Packet Data ("CDPD") networks. Both of the new product lines leverage the
Company's wireless and digital signal processing expertise and high volume, low
cost manufacturing capabilities.

The Company markets its products both under the ESCORT(R) brand name
through direct advertising and as an OEM supplier. The Company's strategy for
entering new markets is to align with companies that have established sales
leadership and market positions. This strategy is designed to provide broader
access to the end user. Several major suppliers of consumer telephones market
the Company's digital spread spectrum cordless telephones on a private label
basis. The Company has established marketing arrangements with five major
cellular service providers to sell its wireless data modems.

THE OFFERING

<TABLE>
<S> <C>
Common Shares.......................... Common Shares, without par value. Up to 1,073,620
Common Shares will be issued assuming all
outstanding Warrants are exercised.
Warrants............................... Each Warrant entitles the holder thereof to purchase
one Common Share at an exercise price of $4.00 at
any time prior to 5:00 p.m., Eastern Standard Time,
on December 31, 1998.
Nasdaq National Market Symbol for
Common Shares........................ "CNMW"
Nasdaq National Market Symbol for
Warrants............................. "CNMWW"
</TABLE>

SUMMARY CONSOLIDATED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
YEAR ENDED NINE MONTHS ENDED
---------------------------------------------------- --------------------------
DECEMBER DECEMBER DECEMBER DECEMBER DECEMBER SEPTEMBER 25, OCTOBER 1,
31, 1990 29, 1991 27, 1992 26, 1993 25, 1994 1994 1995
-------- -------- -------- -------- -------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net sales............................ $63,720 $48,292 $51,339 $58,461 $64,708 $41,341 $ 54,782
Gross profit......................... 21,189 15,129 13,520 18,683 14,349 11,521 12,965
Operating loss....................... (3,576 ) (5,330 ) (7,426 ) (3,084 ) (10,024 ) (6,366) (4,548)
Net loss............................. (5,551 ) (8,821 ) (6,440 ) (1,284 ) (10,260 ) (6,319) (4,002)
Net loss per share................... $ (0.54 ) $ (0.85 ) $ (0.59 ) $ (0.12 ) $ (0.94 ) $ (0.58) $ (0.28)
Weighted average number of shares
outstanding........................ 10,291 10,355 10,919 10,691 10,880 10,864 14,175
</TABLE>

<TABLE>
<CAPTION>
OCTOBER 1, 1995
--------------------------
ACTUAL AS ADJUSTED(1)
------- --------------
<S> <C> <C>
BALANCE SHEET DATA:
Working capital.......................................................................... $17,738 $ 22,032
Total assets............................................................................. 54,375 56,718
Short-term debt.......................................................................... 4,501 2,550
Long-term lease obligations.............................................................. 725 725
Long-term debt........................................................................... -- --
Shareholders' equity..................................................................... 33,390 37,684
</TABLE>

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(1) Adjusted to give effect to 1,073,620 shares issuable at $4.00 per share upon
exercise of the 1,073,620 Warrants outstanding as of November 1, 1995. See
"Use of Proceeds" and "Capitalization."

The Company's executive offices are located at One Microwave Plaza, Cincinnati,
Ohio 45249-8236. Its telephone number is (513) 489-5400.

5
<PAGE> 6

RECENT DEVELOPMENTS

On December 1, 1995, John W. Noland, the Company's Executive Vice
President, Chief Operating Officer and a director, resigned all of his positions
with the Company effective that date. Mr. Robinson, the Company's President and
Chief Executive Officer, has assumed the responsibilities of chief operating
officer.

On December 12, 1995 the Company announced that it expected to report a
loss for both the fourth quarter and for the full year ending December 31, 1995.
Although the Company appears on track to achieve its goal of doubling full year
sales of its digital spread spectrum cordless telephones, on-going cost overruns
in all product areas, combined with softening of the radar detector market, will
result in a loss for the fourth quarter.

The Company also announced on December 12, 1995 that it has named Craig V.
Wolf to the newly-created position of Vice President and Chief Financial
Officer, effective immediately. Mr. Wolf most recently served as General Manager
of Armco Financial Group and President of Armco Financial Services Corporation,
two units of Pittsburgh-based Armco, Inc.

RISK FACTORS

Prior to purchasing the Common Shares offered hereby, prospective investors
should carefully consider, together with the other information contained herein,
each of the following risk factors which could, individually or in the
aggregate, have a material adverse effect on the Company's business, financial
condition, including working capital, and results of operations.

HISTORICAL LOSSES; VARIABILITY OF OPERATING RESULTS; SEASONALITY

The Company has not been profitable since 1988. In 1994, the Company
experienced a severe supply shortage of inductors, a critical component of its
digital spread spectrum cordless telephone, and, as a result, the Company's
factory production schedule and cost to fill customer orders were materially and
adversely affected. In addition, several competing radar warning detector
manufacturers announced significant price reductions in the fourth quarter of
1994. In order to maintain its radar warning detector market position, the
Company reacted to this development by introducing a major promotional program
for its retail customers for the month of December. As a result of these events,
the Company's operating results were significantly worse than anticipated.

The Company was not profitable in the third quarter of 1995 or for the
first nine months of 1995 and will not be profitable for the fourth quarter of
1995 or for the fiscal year ending December 31, 1995. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
"Recent Developments."

The Company's future operating results may vary significantly from period
to period as a result of a number of factors, including the volume and timing of
orders received during the period, the timing of new product introductions by
the Company and its competitors, decline in demand for the Company's products,
the impact of price competition on the Company's average selling prices, the
availability and pricing of components for the Company's products, changes in
product or distribution channel mix and product returns. Many of these factors
are beyond the Company's control. The Company's failure to introduce new,
competitive products consistently and in a timely manner could adversely affect
operating results for one or more product cycles. In addition, from time to
time, a significant portion of the Company's sales are derived from a limited
number of customers, the loss of one or more of which could adversely impact
operating results.

The Company must plan production, order components and undertake its
development, sales and marketing activities and other commitments months in
advance. Accordingly, any shortfall in net sales in a given quarter may have a
disproportionately adverse impact on the Company's operating results due to an
inability to adjust expenses or inventory during the quarter to match the level
of net sales for the quarter. Excess inventory could also result in cash flow
difficulties as well as expenses associated with inventory writeoffs.

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<PAGE> 7

The Company's business is highly seasonal with a large portion of sales
occurring during the third and, particularly, the fourth quarters. The Company's
inability to supply its products to its customers during the second half of the
year would adversely affect the Company's business, financial condition and
results of operations. In addition, the results of the Company's operations are
subject to changes in consumer demand associated with general economic
conditions and to changes in consumer preferences.

As a result of the foregoing, there can be no assurance that the Company
will be able to achieve profitability or that difficulties will not occur in the
future and adversely affect the Company's business, financial condition,
including working capital, and results of operations. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations."

COMPONENT SHORTAGES; RELIANCE ON SOLE OR LIMITED SOURCE SUPPLIERS

The Company's products include a number of high-technology components that
are available from only a few suppliers and, in several cases, a single
supplier. The Company frequently requires large volumes of such components. If
the Company's suppliers are unable to fulfill the Company's needs for such
components, the Company may be unable to fill customer orders and its business,
financial condition, including working capital, and results of operations may be
materially and adversely affected. In 1993, and again in 1994, certain of the
Company's suppliers were unable to deliver sufficient quantities of critical
components to allow the Company to manufacture its products at previously
anticipated volumes. These shortages adversely affected the Company's ability to
manufacture and deliver products and, as a result, had a significant adverse
effect on the Company's business, financial condition, including working
capital, and results of operations. Since part of the Company's strategy is to
shorten product development and introduction cycles, occasions may arise in the
future where the Company's ability to produce products outpaces its suppliers'
ability to supply components. There can be no assurance that the Company can
continue to obtain adequate supplies or obtain such supplies at their historical
cost levels. The Company has no guaranteed supply arrangements with any of its
sole or limited source suppliers, does not maintain an extensive inventory of
components, and customarily purchases sole or limited source components pursuant
to purchase orders placed from time to time in the ordinary course of business.
Moreover, the Company's suppliers may, from time to time, experience production
shortfalls or interruptions which impair the supply of components to the
Company. There can be no assurance that such shortages will not occur in the
future and adversely affect the Company's business, financial condition,
including working capital, and results of operations.

DEPENDENCE ON RADAR WARNING DETECTORS; RELIANCE ON NEW PRODUCTS

Historically, the Company has derived substantially all of its net sales
and all of its operating profits from radar warning detectors. Radar warning
detectors accounted for 79%, 86%, 72% and 72% of the Company's total net sales
for 1992, 1993, 1994 and the first nine months of 1995, respectively. The radar
warning detector market has matured and is declining, and competition in this
market is intense. The Company's strategy is to reduce its dependence on radar
warning detectors by developing new products, entering new markets and utilizing
its capabilities in the design and mass production of ultrahigh frequency and
microwave wireless communications products; however, there can be no assurance
that the Company's strategy will be successful.

The Company has developed and introduced two new products: digital spread
spectrum cordless telephones with enhanced range, clarity and security compared
to traditional cordless telephones, and a line of wireless data modems to
transmit data over CDPD networks. The Company believes that its digital spread
spectrum cordless telephones are vital to its future success. To date, the
Company's digital spread spectrum cordless telephone product line has not been
profitable and the Company believes that future profits, if any, will depend on
the success of next generation models which have been introduced recently. The
commercial success of the Company's digital spread spectrum cordless telephone
products is dependent upon strategic relationships with key OEM customers.
Certain of these customers currently possess, or may acquire, the capability to
develop, design and manufacture their own digital spread spectrum cordless
telephone products. Moreover, the success of the wireless data modems is
dependent upon the development, deployment and commercial success of CDPD
networks. A consortium of cellular service providers is presently building CDPD
networks to provide wireless data transfer service, but there can be no
assurance that the networks will be deployed nationally and, if so deployed,
that they will be successful. To date, the Company has sold only a

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<PAGE> 8

limited number of its wireless data modem units. There can be no assurance that
the Company will be successful in identifying, developing, manufacturing and
marketing new products, that the Company will not experience difficulties that
could delay or prevent the successful development, introduction and marketing of
these products, or that its new products and product enhancements will
adequately meet the requirements of the marketplace and achieve market
acceptance.

CUSTOMER CONCENTRATION

As the Company's sales mix continues to shift from direct retail business
to OEM and reseller business, the Company expects that sales to certain of its
OEM and reseller customers will account for a material percentage of its net
sales in the foreseeable future and believes that its financial results will
depend in significant part upon the success of these customers as well as the
Company's business with these customers. Although the composition of the group
comprising the Company's important customers may vary from period to period, the
loss of a significant customer or any reduction in orders by any significant
customer may have a material adverse affect on the Company's business, financial
condition, including working capital, and results of operations. The Company's
ability to increase its sales in the future will depend in part upon its ability
to obtain orders from new customers as well as the financial condition and
success of its customers and the general economy, of which there can be no
assurance.

SHORT PRODUCT LIFE CYCLES

The market for the Company's products is characterized by frequent new
product introductions and rapid product obsolescence. These factors typically
result in short product life cycles. The Company must continually monitor
industry trends and choose new technologies and features to incorporate into its
products. Each new product cycle presents opportunities for current or
prospective competitors of the Company to gain market share. Life cycles of
individual products are typically characterized by steep declines in sales,
pricing and margins toward the end of a product's life, the precise timing of
which may be difficult to predict. As new products are planned and introduced,
the Company attempts to monitor closely the inventory of older products and to
phase out their manufacture in a controlled manner. Nevertheless, the Company
could experience unexpected reductions in sales volume and prices of older
generation products as customers anticipate new products. These reductions could
give rise to charges for obsolete or excess inventory. To the extent that the
Company is unsuccessful in managing product transitions, its business, financial
condition, including working capital, and results of operations could be
materially and adversely affected.

GOVERNMENT REGULATION

Existing, pending or future legislation prohibiting the use, possession or
sale of radar warning detectors or future legislation by states increasing speed
limits could have a material adverse effect on the Company's business.
Currently, there are two jurisdictions in the United States which have specific
prohibitions against the use, possession or sale of radar warning detectors in
automobiles. In addition, two other jurisdictions prohibit the use of radar
warning detectors in large commercial vehicles only and, in January 1994, the
Federal Highway Administration enacted a regulation banning radar warning
detectors from commercial vehicles weighing over 18,000 pounds, from buses
carrying 16 or more passengers and from trucks transporting hazardous materials
on highways funded by the Federal Government. This is, in effect, a ban on use
of such radar warning detectors in all large trucks and buses. Additionally, on
November 28, 1995, a federal law was enacted that eliminated the existing
federal requirement that states comply with national maximum speed limit
provisions before receiving certain federal funds. This law has resulted in
higher speed limits in some states.

COMPETITION

All markets in which the Company participates are highly competitive, and
many current or prospective competitors, including several of the Company's
significant OEM customers, are substantially larger and possess significantly
greater financial, marketing and technical resources than the Company. The
market for high performance cordless telephones, such as those manufactured by
the Company, is relatively new. Competition in this segment currently is based
primarily on product performance, features and price. The market for wireless
data modems is still developing, and there are current or prospective
competitors who are substantially larger than the Company and possess
significantly greater financial, marketing and technical

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resources. There can be no assurance that the Company will be able to compete
successfully in either of these markets.

The market for radar warning detectors is highly competitive, has matured
and is declining. As the market has moved toward lower priced products,
competition has been based primarily on price and, to a lesser degree, product
quality, availability and performance. Lower than expected demand for the
Company's radar warning detectors, coupled with intense price competition in the
radar warning detector market, adversely affected the Company's fourth quarter
1994 results. A recurrence of these conditions would have a material adverse
effect on the business, financial condition, including working capital, and
results of operations of the Company.

DEPENDENCE ON KEY PERSONNEL

The Company has previously stated that the success of the Company is
dependent in large part on key management and technical personnel, especially
Jacques A. Robinson, its President and Chief Executive Officer, and John W.
Noland, its Executive Vice President and Chief Operating Officer. On December 1,
1995, Mr. Noland resigned his positions with the Company effective that date.
Mr. Robinson has assumed the responsibilities of chief operating officer. The
loss of the services of Mr. Robinson or any of the remaining key personnel could
have a material adverse effect on the Company. Many of the Company's key
personnel would be difficult to replace, and most are not subject to employment
or noncompetition agreements. There can be no assurance that the Company will be
successful in retaining such personnel. In addition, the Company's success
depends significantly upon its ability to continue to attract and retain
qualified management, manufacturing, technical, sales and support personnel for
its operations. There may be only a limited number of persons with the requisite
skills to serve in these positions, and it may become more difficult for the
Company to hire such personnel. Competition for such personnel is intense, and
there can be no assurance that the Company will be successful in attracting or
retaining such personnel. The failure to attract or retain such persons would
materially adversely affect the Company's business, financial condition,
including working capital, and results of operations.

INTELLECTUAL PROPERTY

Although the Company has protected its technologies and products by patent,
copyright, trademark and trade secret laws to the extent that it believes
necessary, the Company's intellectual property rights may be subject to
infringement. There can be no assurance that the Company's measures to protect
its proprietary rights will deter or prevent unauthorized use of the Company's
technology. Furthermore, the laws of certain countries may not protect the
Company's proprietary rights to the same extent as do the laws of the United
States. In addition, the Company may, from time to time, become subject to legal
claims asserting that the Company has violated intellectual property rights of
third parties. In the event a third party were to sustain a valid claim against
the Company and in the event any required license were not available on
commercially reasonable terms, the Company's business, financial condition,
including working capital, and results of operations could be materially and
adversely affected. Litigation, which could result in substantial costs to and
diversion of resources of the Company, may also be necessary to enforce
intellectual property rights of the Company or to defend the Company against
claimed infringement of the rights of others.

VOLATILITY OF STOCK PRICE

The trading price of the Company's Common Shares is subject to wide
fluctuations in response to the Company's operating results, announcements of
technological innovations or new products by the Company or its competitors,
general conditions in the market, changes in earnings estimates by analysts,
failure to meet the revenues or earnings estimates of analysts or other events
or factors. The public stock markets have experienced price and trading volume
volatility in recent months. This volatility has significantly affected the
market prices of securities of many high technology companies for reasons
frequently unrelated to the operating performance of the specific companies. The
market price for the Company's Common Shares has been highly volatile. Future
announcements concerning the Company or its competition, including the results
of technological innovations, new commercial products, government regulations,
developments concerning proprietary rights, component shortages, litigation or
public concern with respect to the Company or its

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products and other factors including those described above, may have a
significant impact on the market price of the Common Shares. See "Price Range of
Common Shares."

LEGAL PROCEEDINGS

Four shareholder lawsuits, allegedly on behalf of classes of all
shareholders of the Company who purchased or sold shares of the Company and were
damaged during various periods, are presently pending against the Company in the
United States District Court, Southern District of Ohio, Western Division,
alleging that the Company and other defendants violated various provisions of
the Securities Act of 1933 and the Securities Exchange Act of 1934 in connection
with the public offering of 4,600,000 Common Shares in August-September 1995,
and otherwise in connection with the market for the Company's Common Shares. See
"Business -- Legal Proceedings." The Company is presently evaluating the
allegations contained in these lawsuits and intends to vigorously defend itself.
The failure to achieve a favorable resolution of these lawsuits could materially
adversely affect the Company's business, financial condition, including working
capital, and results of operations.

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<PAGE> 11

USE OF PROCEEDS

The net proceeds to be received by the Company from the sale of the Common
Shares offered hereby (assuming exercise of the 1,073,620 Warrants outstanding
as of November 1, 1995) are estimated to be $4.3 million. The Company intends to
use the net proceeds for working capital and general corporate purposes,
including repayment of the Company's revolving line of credit.

PRICE RANGE OF COMMON SHARES AND WARRANTS

The Common Shares and the Warrants are traded on the Nasdaq National Market
under the symbol CNMW and CNMWW, respectively. The following table sets forth
for the periods indicated the high and low sales prices for the Common Shares
and the Warrants as reported on the Nasdaq National Market.

<TABLE>
<CAPTION>
COMMON SHARES HIGH LOW
--------------------------------------------------------------- --- ----
<S> <C> <C>
1993
First Quarter............................................. 3 3/8 2 1/8
Second Quarter............................................ 3 3/8 1 7/8
Third Quarter............................................. 5 2 3/8
Fourth Quarter............................................ 10 7/8 4 1/4
1994
First Quarter............................................. 12 7 1/4
Second Quarter............................................ 12 6 1/2
Third Quarter............................................. 10 1/8 5 7/8
Fourth Quarter............................................ 7 1/4 2 1/8
1995
First Quarter............................................. 11 1/4 3 1/2
Second Quarter............................................ 12 1/8 8 3/8
Third Quarter............................................. 21 1/8 13 5/8
Fourth Quarter (through November 1, 1995)................. 13 3/4 5 5/8
</TABLE>

<TABLE>
<CAPTION>
WARRANTS HIGH LOW
--------------------------------------------------------------- --- ----
<S> <C> <C>
1994
Fourth Quarter............................................ 2 3/4 1/16
1995
First Quarter............................................. 7 1/4 1 1/4
Second Quarter............................................ 12 3/4 4 5/8
Third Quarter............................................. 17 1/8 10 1/8
Fourth Quarter (through November 1, 1995)................. 10 1/8 4
</TABLE>

On November 1, 1995, the last reported sales price on the Nasdaq National
Market for the Common Shares was $7.00 per share and for the Warrants was $4.625
per Warrant. As of November 1, 1995, there were approximately 1,073 holders of
record of the Common Shares and 63 holders of record of the Warrants.

Warrants not exercised prior to 5:00 p.m., Eastern Standard Time, on
December 31, 1998 will expire and become worthless.

DIVIDEND POLICY

Historically the Company has not paid any cash or other dividends. The
Company does not expect to pay dividends in the foreseeable future, but
currently intends to retain any earnings to finance operations and future
growth. Furthermore, the credit facility agreement between the Company and its
bank prohibits the payment of dividends.

11
<PAGE> 12

CAPITALIZATION

The following table sets forth the unaudited capitalization of the Company
at October 1, 1995, and as adjusted to reflect the receipt of $4.3 million from
the exercise of the 1,073,620 Warrants outstanding as of October 1, 1995 and the
application of the net proceeds therefrom. See "Use of Proceeds." This table
should be read in conjunction with the Company's Financial Statements and
related Notes set forth elsewhere herein.

<TABLE>
<CAPTION>
OCTOBER 1, 1995
-----------------------
ACTUAL AS ADJUSTED
------- -----------
(IN THOUSANDS)
<S> <C> <C>
SHORT-TERM DEBT:
Bank indebtedness.................................................. $ 4,501 $ 2,550
======= ===========
LONG-TERM OBLIGATIONS:
Long-term capital lease obligations................................ $ 725 $ 725
Long-term debt..................................................... -- --
------- -----------
Total long-term obligations..................................... $ 725 $ 725
------- -----------
SHAREHOLDERS' EQUITY:
Common shares without par value ($.20 stated value); 20,000,000
shares authorized; 18,153,120 shares issued(1).................. $ 3,641 $ 3,641
Paid-in capital.................................................... 24,190 21,377
Retained earnings.................................................. 22,919 22,919
Treasury stock at cost, 2,608,004 shares(2); 1,534,384 shares as
adjusted........................................................ (17,360) (10,253)
------- -----------
Total shareholders' equity...................................... 33,390 37,684
------- -----------
Total capitalization............................................ $34,115 $ 38,409
======= ===========
</TABLE>

- ---------------

(1) Includes treasury stock.

(2) Of the treasury stock, 1,534,384 Common Shares are reserved for stock
options and 1,073,620 Common Shares may be issued upon the exercise of the
Warrants.

12
<PAGE> 13

DILUTION

The net tangible book value of the Company as of October 1, 1995, was
approximately $31.1 million or $2.00 per share. Net tangible book value per
share is equal to the Company's total tangible assets less its total
liabilities, divided by the number of Common Shares outstanding.

The exercise of the Warrants will result in the further increase of
shareholders' equity for the Company's shareholders and dilution to Warrant
holders exercising Warrants. The following table illustrates, as of October 1,
1995, the dilutive effect of the exercise of the 1,073,620 Warrants outstanding
on October 1, 1995.

<TABLE>
<S> <C> <C>
Shareholders' equity per share as of October 1, 1995........ $2.00
Pro forma shareholders' equity per share after the exercise
of Warrants............................................... $2.13
Increase per share attributable to exercise of Warrants..... $0.13
Dilution per share to Warrant holders who exercise
Warrants.................................................. $1.87
</TABLE>

13
<PAGE> 14

SELECTED CONSOLIDATED FINANCIAL DATA

The following table sets forth selected historical consolidated financial
data of the Company for the fiscal years 1990 through 1994 and for the nine
month periods ended September 25, 1994 and October 1, 1995. The selected
consolidated financial data for the five fiscal years in the period ended
December 25, 1994 are derived from the consolidated financial statements of the
Company which have been audited by Price Waterhouse LLP, independent
accountants. The selected consolidated financial data for the nine month periods
ended September 25, 1994 and October 1, 1995 are derived from the Company's
unaudited consolidated financial statements. In the opinion of management, the
interim financial data reflect all adjustments, consisting of normal recurring
adjustments, necessary for the fair presentation of such data. The results for
the first nine months of fiscal 1995 are not necessarily indicative of the
results to be expected for the full year. The information below should be read
in conjunction with the Financial Statements and Notes thereto and "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
appearing elsewhere in this Amended Prospectus. The Company did not pay any cash
or other dividends in the periods presented below.

<TABLE>
<CAPTION>
YEAR ENDED (1) NINE MONTHS ENDED
---------------------------------------------------- -------------------
DECEMBER DECEMBER DECEMBER DECEMBER DECEMBER SEPTEMBER OCTOBER
31, 1990 29, 1991 27, 1992 26, 1993 25, 1994 25, 1994 1, 1995
-------- -------- -------- -------- -------- --------- -------
(IN THOUSANDS EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net sales.................................. $63,720 $48,292 $51,339 $58,461 $64,708 $41,341 $54,782
Cost of sales.............................. 42,531 33,163 37,819 39,778 50,359 29,820 41,817
-------- -------- -------- -------- -------- --------- -------
Gross profit........................... 21,189 15,129 13,520 18,683 14,349 11,521 12,965
Operating expenses:
Research & development................... 4,090 4,843 7,182 8,117 8,449 6,326 5,631
Selling.................................. 14,734 10,838 10,707 10,391 12,671 9,152 8,307
Administrative........................... 5,941 4,778 3,057 3,259 3,253 2,409 3,575
-------- -------- -------- -------- -------- --------- -------
24,765 20,459 20,946 21,767 24,373 17,887 17,513
-------- -------- -------- -------- -------- --------- -------
Operating loss........................... (3,576 ) (5,330 ) (7,426 ) (3,084 ) (10,024 ) (6,366) (4,548 )
Gain on sale of marketable equity
securities............................... -- -- -- 1,435 -- -- --
Interest expense........................... (350 ) (433 ) (204 ) (521 ) (738 ) (459) (838 )
Other income (expense), net................ 118 (869 ) (1,128 ) 886 502 506 (54 )
-------- -------- -------- -------- -------- --------- -------
Loss from continuing operations before
income taxes........................... (3,808 ) (6,632 ) (8,758 ) (1,284 ) (10,260 ) (6,319) (5,440 )
Income tax benefit......................... (1,198 ) (725 ) -- -- -- -- (1,438 )
-------- -------- -------- -------- -------- --------- -------
Loss from continuing operations.......... (2,610 ) (5,907 ) (8,758 ) (1,284 ) (10,260 ) (6,319) (4,002 )
Discontinued operations.................... (2,941 ) (2,914 ) 1,449 -- -- -- --
-------- -------- -------- -------- -------- --------- -------
Loss before extraordinary item........... (5,551 ) (8,821 ) (7,309 ) (1,284 ) (10,260 ) (6,319) (4,002 )
Realization of net operating loss
carryforward............................. -- -- 869 -- -- -- --
-------- -------- -------- -------- -------- --------- -------
Net loss................................... $(5,551 ) $(8,821 ) $(6,440 ) $(1,284 ) $(10,260) $(6,319) $(4,002)
========= ========= ========= ========= ========= ========= =======
Net loss per share:
Continuing operations.................... $ (0.25 ) $ (0.57 ) $ (0.80 ) $ (0.12 ) $ (0.94 ) $ (0.58) $(0.28 )
Discontinued operations.................. (0.29 ) (0.28 ) 0.13 -- -- -- --
Realization of net operating loss
carryforward........................... -- -- 0.08 -- -- -- --
-------- -------- -------- -------- -------- --------- -------
Net loss............................... $ (0.54 ) $ (0.85 ) $ (0.59 ) (0.12 ) (0.94 ) $ (0.58) $(0.28 )
========= ========= ========= ========= ========= ========= =======
Weighted average number of shares
outstanding.............................. 10,291 10,355 10,919 10,691 10,880 10,864 14,175
BALANCE SHEET DATA:
Working capital............................ $ 6,398 $ 1,957 $(2,483 ) $ (254 ) $(1,701 ) $ (184) $17,738
Total assets............................... 45,484 38,247 42,512 32,418 32,839 38,526 54,375
Short-term debt............................ 5,400 4,000 6,000 6,001 600 4,158 4,501
Long-term lease obligations................ -- -- -- 418 1,422 1,201 725
Long-term debt............................. -- -- -- -- 7,419 5,114 --
Shareholders' equity....................... 31,832 23,368 17,641 16,830 6,902 10,831 33,390
</TABLE>

- ---------------

(1) In 1991, the Company changed its reporting period to a fiscal year ending
the last Sunday in the calendar year. In addition, pretax restructuring and
impairment charges of approximately $6.9 million were recorded in March

1991.

14
<PAGE> 15

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Cincinnati Microwave was founded in 1976 to pioneer the development and
design of consumer radar warning detectors using superheterodyne technology,
which has now become the industry standard for these products. The Company
experienced significant growth and profitability in the 1980s due to the
performance of its products, which attracted many competitors. During this
period, the Company's competitors focused on lower prices while the Company
focused on technological improvements. Consequently, the Company lost
substantial market share to competitors in the late 1980s. In 1991 the Company
adopted a strategy of capitalizing on its expertise in the design and
manufacture of ultrahigh frequency and microwave electronic devices by applying
it to wireless communication products. In 1993 the Company introduced its first
digital spread spectrum cordless telephone and wireless data modem products.

RESULTS OF OPERATIONS

The following table sets forth certain operational data of the Company
expressed as a percentage of net sales for the periods indicated:

<TABLE>
<CAPTION>
YEAR ENDED NINE MONTHS ENDED
-------------------------------- --------------------
DECEMBER DECEMBER DECEMBER SEPTEMBER OCTOBER
27, 1992 26, 1993 25, 1994 25, 1994 1, 1995
-------- -------- -------- --------- -------
<S> <C> <C> <C> <C> <C>
Net sales........................... 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of sales....................... 73.7 68.0 77.8 72.1 76.3
-------- -------- -------- --------- -------
Gross profit................... 26.3 32.0 22.2 27.9 23.7
Research & development.............. 14.0 13.9 13.1 15.3 10.3
Selling............................. 20.8 17.8 19.6 22.1 15.2
Administrative...................... 6.0 5.6 5.0 5.8 6.5
-------- -------- -------- --------- -------
Total operating expenses....... 40.8 37.3 37.7 43.2 32.0
-------- -------- -------- --------- -------
Operating loss...................... (14.5) (5.3) (15.5) (15.3) (8.3)
========= ========= ========= ========= =======
</TABLE>

The following table shows net sales by product line for the Company, for
the periods indicated (in thousands and as a percentage of total net sales):

<TABLE>
<CAPTION>
YEAR ENDED NINE MONTHS ENDED
----------------------------------------------- ------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
DECEMBER 27, DECEMBER 26, DECEMBER 25, SEPTEMBER 25, OCTOBER 1,
1992 1993 1994 1994 1995
------------- ------------- ------------- ------------- -------------
Radar warning detectors.................... $40,509 79% $50,125 86% $46,602 72% $32,572 79% $39,344 72%
Cordless telephones........................ -- -- 2,705 4 14,060 22 6,128 15 14,430 26
Other(1)................................... 10,830 21 5,631 10 4,046 6 2,641 6 1,008 2
------- --- ------- --- ------- --- ------- --- ------- ---
Total...................................... $51,339 100% $58,461 100% $64,708 100% $41,341 100% $54,782 100%
======= === ======= === ======= === ======= === ======= ===
</TABLE>

- ---------------

(1) Other sales for 1992, 1993, 1994 and the first nine months of 1995 represent
revenue primarily from contract manufacturing activities of the Company.
This activity ceased during the first quarter of 1995. For 1994 and the
interim period of 1995, other sales include sales of wireless data modems of
$368,000 and $248,000, respectively. Other sales for 1992 and 1993 do not
include revenues from sales of home incarceration units to Guardian
Technologies, Inc., which are treated as discontinued operations.

NINE MONTHS ENDED OCTOBER 1, 1995 COMPARED TO NINE MONTHS ENDED SEPTEMBER 25,
1994

Cincinnati Microwave's net sales for the third quarter of $22.1 million
were 45% higher than the comparable period of 1994. Net sales for the nine
months (40-week period) ended October 1, 1995, increased 33% to $54.8 million as
compared with $41.3 million in the 39-week period of 1994. Indicative of the
anticipated shift in the sales mix, third quarter revenue from cordless
telephones with SureLinkTM technology rose 140% to $8.6 million, or nearly 40%
of net sales, from $3.6 million, or 23% of net sales, in last year's comparable
period. Sales of cordless telephones to AT&T represented 26% and 12% of net
revenue for the

15
<PAGE> 16

three and nine month periods ended October 1, 1995, respectively. Third quarter
revenue from radar detectors was up 26% to $13.3 million from $10.6 million in
the comparable period of 1994.

The Company's gross profit margin was 17% for the third quarter compared
with 20% for the comparable period of 1994 and 24% for the nine months ended
October 1, 1995 versus 28% for 1994. The decline in the gross profit margin was
partially due to unanticipated material and manufacturing costs incurred by the
Company to maintain product quality and timely production, and to meet
commitments to customers. To correct a design difficulty with a key component
(battery charge contacts) in certain of its new cordless telephone models, the
Company was required to spend more than expected to customize replacement parts,
to obtain additional parts and to run the production lines at less than optimum
efficiency. In addition, as a result of a vendor's production error and,
separately, a product design error relating to preprogrammed integrated
circuits, the Company incurred additional costs to obtain one-time programmable
integrated circuits to use in place of the preprogrammed integrated circuits and
to redesign its cordless telephone and radar detector models to use these
programmable circuits.

Gross profit margin percent year to year also was adversely impacted by the
continued, planned shift in the sales mix from direct retail business that
generates a higher gross margin to OEM and reseller business. OEMs and
resellers, including AT&T, accounted for 65% of total sales in the third quarter
compared with 39% for the comparable period in 1994 and 57% for the nine months
ended October 1, 1995 versus 39% in the 1994 period.

Operating expenses in the third quarter were reduced by 9% from the
comparable quarter of 1994. The operating expense decline reflects lower selling
and research and development expenses, offset in part by higher administrative
expenses. The decrease in selling expenses was due primarily to lower
advertising expenses versus 1994. Advertising expenses in the third quarter of
1994 included the costs of extensive promotions for the emerging spread spectrum
cordless telephone product category and the introduction of two new radar
detectors. The increase in administrative expenses reflected the addition of
administrative personnel to support the business growth.

Primarily as a result of the sales increase, the operating loss for the
third quarter was reduced to $2.4 million from $3.7 million for the comparable
period of 1994. Interest expense for the third quarter was $279,000 versus
$234,000 in 1994, due to the receipt of equity proceeds at the end of August
that were utilized to pay amounts outstanding under the revolving credit line.
The net loss for the quarter was $2.6 million versus a net loss of $4.0 million
in 1994. The net loss for the first nine months declined to $4.0 million from
$6.3 million in 1994. In March 1995, as a result of the closure of the Company's
1991 Federal tax return, the Company released certain tax reserves to income.
The adjustment increased net income for the first quarter of 1995 by $1.4
million. The first nine months of 1994 included a gain of $657,000 from a land
sale.

YEAR ENDED DECEMBER 25, 1994 COMPARED TO YEAR ENDED DECEMBER 26, 1993

Cincinnati Microwave's net sales of $64.7 million for 1994 were 10.7%
higher than 1993 net sales. This increase was due entirely to increased sales of
the digital spread spectrum cordless telephone product line, offsetting a 7%
sales decline in the radar warning detector product line. The digital spread
spectrum cordless telephone was introduced during the second quarter of 1993 and
had modest sales in 1993. The decline in the radar warning detector net sales
was due to lower unit volume for these products and lower pricing. The Company's
wireless data modem sales for 1994 were insignificant. Testing of the CDPD
networks continues with end-users testing the system for its compatibility with
their business applications. The Company's wireless data modem has been tested
for various industrial and commercial CDPD applications.

The Company's gross profit margin decreased to 22.2% in 1994 from 32.0% in
1993. This decline was caused by two significant factors. During 1994, the
Company experienced significant component delivery problems relating to its
digital spread spectrum cordless telephone product line. This impacted the
factory production schedule and increased the cost to fill customer orders. For
much of the fourth quarter, the Company operated its digital spread spectrum
cordless telephone production line in a stop and start mode, as and when parts
became available, in order to expedite deliveries to its customers. Secondly,
several competing radar warning detector manufacturers made substantial price
reductions during 1994. In order to maintain its

16
<PAGE> 17

market position, the Company reacted to these developments by introducing a
major sales promotional program for its retail customers for the month of
December.

1994 research and development expenses increased $332,000 from 1993. The
Company continued to focus its efforts on new product development and product
improvements. Selling expenses increased $2.3 million from 1993 primarily as a
result of increased advertising for its digital spread spectrum cordless
telephone. Administrative expenses did not fluctuate significantly from the
prior year.

YEAR ENDED DECEMBER 26, 1993 COMPARED TO YEAR ENDED DECEMBER 27, 1992

Cincinnati Microwave's net sales of $58.5 million for 1993 were 13.9%
higher than 1992 net sales due primarily to a 6% increase in units shipped and a
14% increase in the average selling price of units. Products introduced in 1993
included the super wideband radar laser warning detector, a revised laser
warning detector, the digital spread spectrum cordless telephone and a lower
cost home incarceration unit. The increase in selling prices resulted primarily
from higher sales prices of new products which replaced lower priced products
with fewer features.

The Company's gross profit margin increased from 26.3% in 1992 to 32.0% in
1993. This increase was due primarily to the installation and utilization of an
automated production process in the second half of 1993. The efficient operation
of this equipment had two positive effects. First, sufficient quantities of
product were manufactured to permit the Company to fill customer orders at a
lower cost. Second, the ability to produce these products in an efficient manner
permitted the Company's research and development group to focus its attention on
product design modifications, which enabled the Company to substantially reduce
its dependence on a single microprocessor supplier who was unable to provide
adequate supply of product in early 1993.

Research and development expenses increased $935,000 from 1992, as the
Company continued to focus its efforts on new product development and product
improvements. Selling and administrative expenses did not fluctuate
significantly from the prior year.

In 1993, the Company sold its investment in the common stock of BI
Incorporated for a gain of $1.4 million. The net proceeds of $7.3 million were
utilized by the Company to pay down the Company's credit facility and vendor
accounts.

Interest expense increased from the prior year by $317,000 due to the
Company's increased borrowings on its credit facility.

Other income of $886,000 fluctuated from other expense recorded in 1992 of
$1.1 million primarily as a result of the gain on the sale of land in the fourth
quarter of 1993 of $741,000 and loss from the diminution of the Company's
long-term investment in Cellular Data, Inc. (CDI) of $1.4 million in 1992.

As a result of the merger of Guardian Technologies, Inc., a wholly owned
subsidiary of the Company, and BI Incorporated, the Company recorded net income
from discontinued operations of $1.4 million in 1992 or $0.13 per share. At
December 31, 1993 and 1992, no significant obligations or assets remain related
to discontinued operations. In 1992, the Company also recorded an extraordinary
item for the realization of a book net operating loss carryforward of $869,000.

17
<PAGE> 18

QUARTERLY RESULTS OF OPERATIONS

The following tables set forth certain unaudited quarterly financial
information for the past eight quarters (in thousands except for per share data
and as a percentage of net sales):

<TABLE>
<CAPTION>
QUARTER ENDED
----------------------------------------------------------------------------------------------
SEPTEMBER DECEMBER MARCH JUNE 26, SEPTEMBER DECEMBER APRIL 2, JULY 2, OCTOBER 1,
26, 1993 26, 1993 27, 1994 1994 25, 1994 25, 1994 1995 1995 1995
--------- --------- -------- --------- -------- --------- -------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales...................... $17,545 $22,942 $12,350 $13,692 $15,299 $23,367 $13,648 $19,017 $ 22,117
Gross profit................... 6,620 8,609 4,025 4,509 2,987 2,828 4,091 5,148 3,726
Net income (loss).............. 2,612 2,790 (567 ) (1,757) (3,995 ) (3,941) (582 ) (783 ) (2,637)
Net income (loss) per share.... 0.24 0.24 (0.05 ) (0.16) (0.37 ) (0.36) (0.04 ) (0.06 ) (0.18)
</TABLE>

<TABLE>
<CAPTION>
AS A PERCENTAGE OF NET SALES
----------------------------------------------------------------------------------------------
QUARTER ENDED
----------------------------------------------------------------------------------------------
SEPTEMBER DECEMBER MARCH JUNE 26, SEPTEMBER DECEMBER APRIL 2, JULY 2, OCTOBER 1,
26, 1993 26, 1993 27, 1994 1994 25, 1994 25, 1994 1995 1995 1995
--------- --------- -------- --------- -------- --------- -------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales...................... 100.0% 100.0% 100.0 % 100.0% 100.0 % 100.0% 100.0 % 100.0 % 100.0%
Gross profit................... 37.7 37.5 32.6 32.9 19.5 12.1 30.0 27.1 16.8
Net income (loss).............. 14.9 12.2 (4.6 ) (12.8) (26.1 ) (16.9) (4.3 ) (4.1 ) (11.9)
</TABLE>

Quarterly earnings per share calculations are based on the weighted average
number of shares outstanding for the quarter then ended. Annual earnings per
share calculations are based on weighted average number of shares outstanding
for the twelve month period then ended. Due to fluctuations in the weighted
average number of shares outstanding, the sum of the earnings per share
calculations for each quarter will not necessarily equal the calculated earnings
per share for the twelve month period.

LIQUIDITY AND CAPITAL RESOURCES

During the third quarter of 1995, the Company completed an equity offering
that generated $19.1 million in net proceeds. The funds were used to pay off the
existing revolving credit line and to fund the growth in working capital
required for the planned increase in production and sales for the third and
fourth quarters. In addition, during the first nine months of 1995 the Company
incurred $500,000 of capital lease obligations and utilized $2.0 million of cash
flow for capital expenditures for additional production equipment. In the fourth
quarter, the Company has commitments for an additional $1.5 million in capital
expenditures for production equipment to be funded through cash flow.

The primary contributors to the $19.4 million increase in working capital
between year-end 1994 and the end of the third quarter were a $11.4 million
(221%) rise in accounts receivable and a $10.7 million (117%) increase in
inventories. Accounts payable rose only $1.0 million (11%) between year-end 1994
and the end of the third quarter despite the increase in inventories as the
Company maintained appropriate credit terms with its vendors and paid its
invoices within the terms extended by the vendors..

The increase in accounts receivable to $16.5 million at the end of the
third quarter reflected the upward sales trend of cordless telephones during
1995, with almost half of total unit volume of cordless telephones sold for the
year-to-date period shipped in the last month of the third quarter. OEMs and
resellers, for which typical credit terms (e.g., payment within 30 to 45 days
after delivery) are made available on their large volume orders, represented a
significantly larger proportion of sales in 1995 versus 1994. Retail customers
generally have paid for their purchases at the time it was shipped or delivered.
The Company anticipates that the accounts receivable balance could remain near
the current level ($21.0 million at November 14, 1995) through year-end due to
the high volume of fourth quarter OEM and reseller sales. Receivables should
decrease in the first quarter.

The $10.7 million increase in inventories between year end 1994 and the end
of the third quarter of 1995 was driven by a $6.1 million increase in raw
materials and work in process, as the Company continued to purchase components
with which to manufacture products, as well as a $4.5 million increase in
finished goods inventory. Both raw material and finished goods inventories
continued to rise after the end of the third quarter of 1995 as the Company
prepared for December shipments. Inventories at year-end, however, should be in
line with the levels at the end of the third quarter.

18
<PAGE> 19

Despite the current outlook for the 1995 fourth quarter, year-end raw
material inventories will be above levels necessary to support the anticipated
sales volume. Based on the Company's periodic historic difficulties with
procurement of components, the higher level of inventory could provide an added
level of security in meeting customer commitments. The Company believes the
finished goods inventory at year-end will be appropriate for the anticipated
sales volume.

At October 1, 1995, the Company had borrowed $4.5 million (term loan
balance of $2.6 million and $1.9 million on the revolving credit facility)
against its credit facility due June 30, 1996. The $9.6 million credit facility
consists of (i) the term loan, (ii) a $7.0 million revolving credit facility and
(iii) a standby letter of credit facility not to exceed $1.0 million; however,
the sum of the outstanding principal balance of the revolving credit and the
aggregate amount of the Company's outstanding letters of credit shall not exceed
$7.0 million at any time. The credit facility is secured by a first lien on the
Company's inventory, receivables, equipment and a mortgage on the real estate of
the Company.

Subsequent to October 1, 1995, the revolving credit facility was reduced to
$5.0 million by the lending institution. A temporary increase was extended by
the lending institution maintaining the revolving limit at $7.0 million through
November 17, 1995 and $6.0 million through November 30, 1995. The lending
institution indicated that it reduced the revolving credit limit for several
reasons, including the loss incurred by the Company in the third quarter and the
recent significant rise in working capital. The Company reduced the outstanding
amount on the revolving credit line to $6.0 million by November 17, 1995 and to
$5.0 million by November 30, 1995.

At October 1, 1995 the Company was in violation of one covenant of the
borrowing agreement because of the net loss incurred for the quarter. The
lending institution has waived this violation for the third quarter; however, as
a result of the covenant violation the lending institution has raised the
lending rates to prime plus 2.0% for the revolving loan, from prime plus 1.25%,
and prime plus 2.25% on the term loan, from prime plus 1.50%. Additionally,
similar net loss covenants exist that require the Company to report net income
for the fourth quarter and for the fiscal year ending December 31, 1995. The
Company expects that it will violate the covenants requiring net income for the
fourth quarter and for the fiscal year. The Company will work with its lender to
seek a waiver of the related covenants. Although the lending institution waived
the similar covenant for the third quarter, there can be no assurances that such
a waiver will be granted in the future.

At period end, shareholders' equity was $33.4 million and the ratio of
debt-to-equity was 0.67 versus equity of $10.8 million and a debt-to-equity
ratio of 3.57 at December 25, 1994. The Company believes that its working
capital and credit facilities, along with cash generated from operations, will
be sufficient to fund its operations for the foreseeable future.

19
<PAGE> 20

BUSINESS

The Company designs, manufactures and markets ultrahigh frequency and
microwave wireless communications products. The Company's principal product line
since its inception has been radar warning detectors. The Company has become a
leader in the radar warning detector market by combining its experience in
ultrahigh frequency and microwave wireless technology, including digital signal
processing, with its high volume manufacturing capabilities. In 1993, the
Company introduced its first digital spread spectrum cordless telephone and its
first wireless data modem. Both of the new product lines leverage the Company's
wireless and digital signal processing expertise and high volume manufacturing
capabilities.

BUSINESS STRATEGY

The Company's business strategy is to use its core technology in ultrahigh
frequency and microwave circuit design, digital signal processing, digital
spread spectrum capability and digital communication techniques, together with
its experience in short product development cycles and mass production, to
introduce leading edge products early in new market life cycles. Using the early
introduction as a platform to gain a leading market share, the Company strives
to aggressively introduce subsequent versions of the product at lower prices
made possible by greater production volume and manufacturing efficiencies.

The Company's business strategy includes the following elements:

- - Leverage core technology

The Company has considerable experience in the design, development and
manufacture of portable electronic wireless communication devices that operate
in the ultrahigh frequency radio and microwave spectrum, having utilized this
technology in its radar detection products since 1978. The Company is committed
to capitalizing upon its core technology base, as shown by its development of
new products and the expansion and enhancement of its technology base through
significant and ongoing research and development expenditures.

- - Emphasize short product development cycles

The Company believes that short product development cycles are essential to
its success. Such cycles enable the Company to capitalize upon the higher
margins that are associated with the introduction of new products and positions
the Company to establish itself as a leader in new markets. Since 1991, the
Company has developed and introduced more than 16 radar warning detector
products, four generations of digital spread spectrum cordless telephones and a
series of wireless data modems.

- - Increase manufacturing efficiencies, improve quality and lower product cost

The Company uses surface mount technology ("SMT") extensively to
manufacture its products. The Company was among the first to utilize SMT to
manufacture consumer radar detection products. SMT is the automated
manufacturing process used to place micro electronic components on printed
circuit boards with a high level of accuracy at a high speed. The use of SMT
enables the Company to design and manufacture products that are compact,
portable and reliable and allows it to achieve manufacturing efficiencies that
result in lower costs. The Company has also developed high speed automated
testing capabilities in order to ensure quality and improve manufacturing
efficiency. Testing procedures have become an integral part of the Company's
manufacturing process encompassing all aspects of the manufacture of its
products, from component to sub-assembly and finished product testing.

- - Develop strategic alliances

The Company's strategy for entering new markets is to align with companies
that have established sales leadership and market positions. This strategy is
designed to provide broader access to retailers and end users. The Company
developed its digital spread spectrum cordless telephones and wireless data
modems utilizing this teaming approach. With respect to the Company's digital
spread spectrum cordless telephones, this strategy involves selling as an OEM to
major cordless telephone vendors. With respect to the Company's wireless modems,
this strategy involves working with cellular service providers as well as
vendors of services utilizing the CDPD networks.

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<PAGE> 21

PRODUCTS AND MARKETS

The Company's products are ultrahigh frequency wireless communication
products that operate in the UHF radio and microwave spectrum. At the present
time, the Company has developed and introduced radar warning detectors, digital
spread spectrum cordless telephones and wireless data modems that utilize the
CDPD networks. These three products are described in more detail below.

CORDLESS TELEPHONES

The market for cordless telephones has grown over the past few years and,
according to industry sources, sales of all cordless telephones exceeded 17
million units in 1994, with approximately 700,000 units in the 900 megahertz
("MHz") segment. Conventional cordless phones, which operate in the 46-49 MHz
segment, may be nearing the mature phase of their product life cycle. The
Company believes that the growth area is in high performance telephones, which
operate in the 900 MHz segment. These high performance telephones can deliver to
a consumer the superior range and clarity required for cordless telephones to
become a true substitute for the traditional corded telephone.

In May 1993, the Company introduced its first digital spread spectrum high
performance cordless telephone. These telephones are sold both under the
ESCORT(R) brand name (the ESCORT(R) 9000 series) and to OEM customers. The
Company's digital spread spectrum cordless telephones offer superior performance
over traditional cordless telephones, specifically in the areas of improved
voice clarity, range and communication security. The term "spread spectrum"
refers to a communications technique that encodes signals to be transceived over
multiple frequencies. Spread spectrum transceivers cause substantially less
interference and are less susceptible to interference than conventional
transceivers such as those used in traditional cordless telephones. Due to the
substantially lower interference, the Federal Communications Commission has
specified operating parameters for the 902-928 MHz band that are highly
advantageous to spread spectrum products. The lower susceptibility to
interference together with the advantageous Federal Communications Commission
operating parameters have enabled the Company to design products that can
achieve significantly greater range than traditional cordless telephones.
Cincinnati Microwave has combined spread spectrum technology with digital signal
processing technology, thereby digitizing the speech and transmitting it as a
high speed data transmission. By using a high speed data transmission, no voice
compression is required, resulting in a voice clarity that is comparable to a
traditional corded telephone. Finally, spread spectrum encoding by its nature
scrambles voice and data resulting in very secure communications.

The Company has recently introduced its next generation of digital spread
spectrum cordless telephone models, both for the Company's retail and OEM
channels. These digital spread spectrum cordless telephones are less expensive
to manufacture and can be sold by the Company at a lower price than its previous
digital spread spectrum cordless telephone products.

WIRELESS DATA MODEMS

In July 1993, Cincinnati Microwave announced that it had developed a series
of wireless data modems to be used in conjunction with the CDPD networks being
deployed by a consortium of cellular telephone carriers. CDPD, one of the
recognized leading technologies in wide area wireless data communications, is a
digital system that overlays the cellular voice network and uses the idle times
between cellular voice calls to transmit data. The Company's MC-DART (Mobile
Cellular Data Access Radio Transceiver) wireless data modems enable data to be
sent and received using the CDPD networks without the burden of wires or the
costs of circuit switched connections (the traditional method used for a voice
call). In order to enter this market, the Company has established marketing
arrangements with five leading cellular service providers: Ameritech Mobile
Services, Bell Atlantic Mobile Services, GTE Mobile Communications, McCaw
Cellular Communications, Inc. and Sprint Cellular Communications. Production of
the Company's wireless data modem products commenced in June 1994 and sales to
date have been limited.

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<PAGE> 22

large-scale deployment of wireless credit card verification using CDPD. The
system is now operational in northern New Jersey and the greater Washington,
D.C. and Baltimore, Maryland metropolitan areas.

CDPD has uses in three broad applications of data networking: mobile
applications -- exchanging data with data sources in motion, such as truck
fleets, portable point of sale devices and credit card verification units; fixed
wireless applications -- exchanging data with data sources which are difficult
or prohibitively expensive to reach, such as utility meters, vending machines
and pipe line pumps; and portable applications -- such as portable computers.

RADAR WARNING DETECTORs

The Company's principal product since its formation has been radar warning
detectors, which use microwave and other technologies to detect and amplify
police radar transmissions. During 1992, the Company also began manufacturing
and selling a laser detection product. The Company's superheterodyne radar
warning detectors use digital signal processing and high gain laser detectors to
detect police radar and laser signals and reject unwanted signals so that early
identification is enhanced.

The Company's radar warning detectors are also being used in conjunction
with the Safety Alert1 system that commenced operations in a number of locales
in 1995. The Safety Alert system utilizes small transmitters that emit a low
power K-band microwave signal which can be mounted on anything that may
constitute a traffic hazard (such as a speeding emergency vehicle, a road
construction site or a locomotive approaching a grade crossing). The Safety
Alert signal is encoded and when detected and decoded by an appropriately
equipped radar warning detector, the signal can provide the driver with more
specific information as to the nature of the traffic hazard, thereby enhancing
driver safety. The Company was the first to offer products specifically designed
to decode Safety Alert signals for drivers and commenced shipping such radar
warning detectors in August 1994 (the PASSPORT(R) 5000) in anticipation of the
system's implementation. The Company has added this capability to its entire
radar warning detector product line. The Company believes that the Safety Alert
systems are in limited use at present.

MARKETING AND SALES

The Company's marketing and sales efforts are differentiated into two
distinct categories: Consumer Products and Commercial Products.

CONSUMER PRODUCTS

The Company's radar warning detector products have traditionally been
marketed under the ESCORT(R) brand name by direct advertising. Through
advertisements placed in national publications, such as "Car and Driver" and
"Road & Track," consumers can reach a dedicated telemarketing staff (via a
toll-free phone number) to obtain additional information or place orders for the
Company's products. The successful introduction of the evolving series of
ESCORT(R) radar warning detectors has provided the Company with a loyal customer
base that can be reached by direct mail efforts for new radar warning detector
products as they become available.

To augment this direct sales channel, the Company has developed a strategic
alliance with Home Shopping Network ("HSN"). The Company's radar warning
detector products are marketed to subscribers of HSN's cable shopping networks.
HSN purchased a substantial part of the Company's radar warning detector output
in 1994 and accounted for 14% of the Company's total net sales. For the first
nine months of 1995, HSN purchases have accounted for 10% of the Company's total
net sales. In addition, the Company is actively developing additional alliances
with "sheltered channel" distributors. The Company also sells its radar warning
detectors as an OEM supplier to COBRA Electronics Corporation.

The Company sells its digital spread spectrum cordless telephone primarily
as an OEM as well as under its ESCORT(R) brand. As an OEM, the Company designs,
develops and manufactures digital spread spectrum cordless telephones for
specific customers on a private label basis based upon their specifications. For
the first

- ---------------

1"Safety Alert" is a trademark of COBRA Electronics Corporation.

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<PAGE> 23

nine months of 1995, purchases of digital spread spectrum cordless telephones by
AT&T have accounted for 12% of the Company's total net sales.

COMMERCIAL PRODUCTS

The Company's commercial product marketing and sales efforts have evolved
out of its OEM approach to consumer products. At present the Company's one
commercial product is its wireless data modem. The Company was an early active
participant with the CDPD consortium, with its engineers being consulted in the
formation of the CDPD standards. The Company took advantage of this early start
by aligning itself with certain cellular carriers for the marketing of its
wireless data modem. The Company has established marketing arrangements with
five leading cellular service providers: Ameritech Mobile Services, Bell
Atlantic Mobile Services, GTE Mobile Communications, McCaw Cellular
Communications, Inc. and Sprint Cellular Communications. Production of the
Company's wireless data modem products commenced in June 1994 and sales to date
have been limited.

In June 1995, Bell Atlantic Mobile Services, Firstnet Corporation and the
Company announced that the Company's wireless data modems will provide the
wireless communication link for AireTrans, the nation's first large-scale
deployment of wireless credit card verification using CDPD. The system is now
operational in northern New Jersey and the greater Washington, D.C. and
Baltimore, Maryland metropolitan areas.

RESEARCH AND DEVELOPMENT

The Company believes that continued strong investment in research and
development is critical to its long term growth and success. Utilizing its
expertise in ultrahigh frequency and microwave wireless communications and
digital signal processing, the Company intends to continue to develop new
products that strengthen its position in its current markets as well as to enter
new markets. The research and development activities of the Company are directed
toward product development, product improvement, new product screening,
technology development and manufacturing process development. All of the costs
of such research and development activities are expensed as incurred.

As of October 1, 1995, the Company employed 87 people in research and
development functions. The Company's research and development expenditures (in
dollars and as a percentage of net sales) were $7.2 million (14.0%) for fiscal
year 1992; $8.1 million (13.9%) for fiscal year 1993; $8.4 million (13.1%) for
fiscal year 1994; and $5.6 million (10.3%) for the nine months ended October 1,
1995.

MANUFACTURING

Cincinnati Microwave designs, manufactures, tests and packages its products
at its plant near Cincinnati, Ohio. All of the Company's products are designed
around the Company's manufacturing processes, which particularly emphasize SMT.
SMT is the automated manufacturing process used to place micro electronic
components on printed circuit boards with a high level of accuracy and at high
speed. The use of SMT enables the Company to design and manufacture products
that are compact, portable and reliable and to achieve manufacturing
efficiencies that result in lower costs. The Company believes that it is
important to maintain competitive manufacturing facilities by investing in
advanced manufacturing equipment (particularly SMT and automated test equipment)
and by improving existing and developing new manufacturing processes.

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<PAGE> 24

at their historical cost levels. The Company has no guaranteed supply
arrangements with any of its sole or limited source suppliers, does not maintain
an extensive inventory of components and customarily purchases sole or limited
source components pursuant to purchase orders placed from time to time in the
ordinary course of business. Moreover, the Company's suppliers may, from time to
time, experience production shortfalls or interruptions which impair the supply
of components to the Company. There can be no assurance that such shortages will
not occur in the future and adversely affect the Company's business, financial
condition, including working capital, and results of operations.

TRADEMARKS AND PATENTS

Cincinnati Microwave has a variety of patents, patent applications,
registered and unregistered trademarks and registered trade names. The Company
does not believe that its ability to compete in any of its product markets is
currently dependent on its patents or patent applications, but does believe that
its rights to, and the goodwill associated with, its ESCORT(R), PASSPORT(R) and
SOLO(R) registered trademarks provide it with a marketing advantage and that its
knowledge and accumulated experience in the design and mass production of
ultrahigh frequency wireless transmitters and receivers incorporating digital
signal processing provide it with a competitive advantage.

COMPETITION

All markets in which the Company participates are highly competitive. The
market for conventional cordless telephones is largely driven by AT&T, followed
by four major brands (Bell South, GE, Panasonic and Sony), several other
Regional Bell brands and a host of minor brands. The market for high performance
cordless telephones, such as those manufactured by the Company, is relatively
new. The Company's major competitors in the high performance cordless telephone
market segment are Panasonic, Uniden and Vtech. Competition in this segment is
currently based primarily on product performance, features and price. Many
current or prospective competitors serving this market are substantially larger
than the Company and possess significantly greater financial, marketing and
technical resources than the Company. There can be no assurance that the Company
will be successful against its competition in this market.

The Company's wireless data modems have been proven fully operational on
commercial CDPD networks. The market for wireless data modems is still
developing, and there are current or prospective competitors, such as Motorola
and PCSI, a subsidiary of Cirrus Logic, who are substantially larger than the
Company and possess significantly greater financial and technical resources.
There can be no assurance that the Company will compete successfully in this
market.

The market for radar warning detectors is highly competitive, has matured
and is declining. As the market has moved toward lower priced products offering
fewer features, competition has been based primarily on price and, to a lesser
degree, product quality, availability and performance. Lower than expected
demand for the Company's radar warning detectors, coupled with intense price
competition in the radar warning detector market, adversely affected the
Company's fourth quarter 1994 results. A recurrence of these conditions would
have a material adverse effect on the Company. See "Recent Developments."

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<PAGE> 25

GOVERNMENT REGULATION

Existing, pending or future legislation prohibiting the use, possession or
sale of radar warning detectors or future legislation by states increasing speed
limits could have a material adverse effect on the Company's business.
Currently, there are two jurisdictions in the United States which have specific
prohibitions against the use, possession or sale of radar warning detectors in
automobiles. In addition, two other jurisdictions prohibit the use of radar
warning detectors in large commercial vehicles only and, in January 1994, the
Federal Highway Administration enacted a regulation banning radar warning
detectors from commercial vehicles weighing over 18,000 pounds, from buses
carrying 16 or more passengers and from trucks transporting hazardous materials
on highways funded by the Federal Government. This is, in effect, a ban on use
of such radar warning detectors in all large trucks and buses. On November 28,
1995, a federal law was enacted that eliminated the existing federal requirement
that states comply with national maximum speed limit provisions before receiving
certain federal funds. This law has resulted in higher speed limits in some
states.

In addition, radio communications are subject to regulation by United
States and foreign laws and international treaties. The Company's digital spread
spectrum cordless telephones and wireless data modems must conform to domestic
and international requirements established to avoid interference among users of
radio frequencies. Therefore, the Company's opportunities to introduce new
products may be limited to the extent that suitable radio frequencies are not
available.

EMPLOYEES

As of October 1, 1995 the Company had 504 employees: 92 employees in
engineering, 277 employees in manufacturing, 93 employees in sales and marketing
and 42 employees in administration. The Company believes that its relations with
its employees are good. None of the Company's employees is represented by a
labor union or covered by a collective bargaining agreement, and the Company has
never experienced a work stoppage as a result of its employee relations.

PROPERTIES

Cincinnati Microwave owns its manufacturing and research facilities and
executive offices located on 13 acres of land near the intersection of
Fields-Ertel Road and I-71, approximately twenty miles north of Cincinnati,
Ohio. The building at One Microwave Plaza, built in 1982 and expanded in 1986,
is a modern 172,000 square foot, one-story building.

The Company also owns substantially all of the equipment associated with
its manufacturing, research and testing operations. The Company has acquired
certain equipment through leasing arrangements. All equipment is modern, in good
operating condition and well-maintained and, except for leased equipment, is
currently used as collateral for the line of credit with the current lender.

LEGAL PROCEEDINGS

Four shareholder lawsuits are currently pending against the Company. On
October 18, 1995, an action was filed in the United States District Court,
Southern District of Ohio, Western Division, by Richard Kaufman, individually
and allegedly on behalf of all others similarly situated, against the Company,
James L. Jaeger, Jacques A. Robinson, John W. Noland, the Company's directors,
Montgomery Securities and Roney & Co. On October 24, 1995, another action was
filed in the United States District Court, Southern District of Ohio, Western
Division, by Bruce Stumpf and Paul J. O'Reilly, individually and allegedly on
behalf of others similarly situated, against the same defendants named in the
Kaufman suit. Both actions allege that, in connection with the sale of 4,600,000
Common Shares of the Company in a public offering in late August 1995, the
defendants had violated various sections of the Securities Act of 1933 and had
made negligent misrepresentations. The plaintiffs generally seek damages in an
amount equal to the difference between the price paid for the shares purchased
in the public offering and either the current value of such shares, if currently
held, or the price at which such shares were disposed of in the market, if
disposed of before the commencement of the action; or, alternatively, to rescind
the purchases and recover the consideration paid for the shares or, if such
shares are no longer held by plaintiffs, for unspecified damages.

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<PAGE> 26

On October 18, 1995, an action was filed in the United States District
Court, Southern District of Ohio, Western Division, by Chesapeake Capital Group,
Inc., for itself and allegedly on behalf of all others similarly situated,
against the Company, James L. Jaeger, Jacques A. Robinson, John W. Noland,
Montgomery Securities and Roney & Co. alleging that, in connection with the
public offering of 4,600,000 Common Shares of the Company in August-September
1995, the defendants had violated sections of the Securities Exchange Act of
1934 and the Securities Act of 1933. On November 2, 1995, an action was filed in
the United States District Court, Southern District of Ohio, Western Division,
by Mary Ellen Guthrie and Ronald S. Rees, individually and allegedly on behalf
of all others similarly situated, against the Company, James L. Jaeger and
Jacques A. Robinson, alleging that the defendants violated sections of the
Securities and Exchange Act of 1934. Both complaints seek unspecified damages to
be determined at trial.

The Company is presently evaluating the allegations contained in these
lawsuits and intends to vigorously defend itself.

MANAGEMENT

The following table sets forth certain information with respect to the
executive officers and directors of the Company:

<TABLE>
<CAPTION>
NAME AGE POSITION
- --------------------- --- -------------------------------------------------------------
<S> <C> <C>
James L. Jaeger 47 Chairman of the Board
Jacques A. Robinson 48 President, Chief Executive Officer, Chief Operating Officer
and Director
R. Gregory Blair 48 Vice President/Product Management
Anita L. Hromish 41 Vice President/Chief Information Officer
Thomas H. Perszyk 48 Vice President/Engineering
Walter P. Masavage 60 Vice President/Finance, Treasurer and Secretary
Robert J. Brockman 50 Vice President/Commercial Products Marketing and Sales
Craig V. Wolf 47 Vice President/Chief Financial Officer
Charles M. Fullgraf 77 Director
Joseph M. O'Donnell 49 Director
Gilbert L. Wachsman 47 Director
Erika Williams 48 Director
</TABLE>

James L. Jaeger is a founder of the Company. In May 1985 he was elected
Chairman of the Board. He also served as Chief Executive Officer of the Company
from June 1983 until June 1988 and from January 1990 through April 22, 1991. He
has been a Director of the Company since 1976. Mr. Jaeger spends substantially
all of his time on activities outside of the Company.

Jacques A. Robinson has been President and Chief Executive Officer of the
Company since April 23, 1991, Chief Operating Officer of the Company since
December 1, 1995 and President of The Scotcrest Group since its incorporation in
1989. From July 1987 through February 1991, Mr. Robinson served as President of
Carillon Technology, Inc. (a California company that manufactured consumer audio
technology products). From 1979 through June 1987, Mr. Robinson held various
positions with the General Electric Company; his most recent position with that
company was Vice President and General Manager of the Consumer Electronics
Business Operations. He has been a Director of the Company since 1991.

R. Gregory Blair is Vice President/Products Management. Mr. Blair joined
the Company in December 1984 as its Director of Manufacturing and in October
1985 was appointed Vice President-Operations. He also served as President and
Chief Operating Officer of Guardian Technologies, Inc., a wholly owned
subsidiary of the Company, from March 1987 to November 1988, and as President
and Chief Operating Officer of CMI Technologies, Inc., a wholly owned subsidiary
of the Company, from November 1988 until September 1991.

Anita L. Hromish is Vice President/Chief Information Officer of the
Company. Ms. Hromish joined the Company in March 1986 and has assumed positions
of increasing responsibility during this time. From 1979 to

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<PAGE> 27

1984, Ms. Hromish was employed by The Procter & Gamble Company ("P&G") (a
diversified manufacturer of household and industrial products headquartered in
Cincinnati, Ohio) in the Management Systems Division. Ms. Hromish was appointed
Vice President in July 1993.

Thomas H. Perszyk is Vice President/Engineering. Prior to joining the
Company in December 1994, Mr. Perszyk was Senior Resource Manager-Engineering
for Motorola and had 24 years of experience with Motorola in the
electrical/electronics engineering field. Recent product responsibilities
included a wide range of portable communication equipment and involved worldwide
assignments in engineering and manufacturing.

Walter P. Masavage, Vice President/Finance, Treasurer and Secretary, worked
for the General Electric Company for 31 years and Thomson Consumer Electronics,
Inc. (a world wide consumer electronics products manufacturing and marketing
company) for six years in accounting management positions of increasing
responsibility. Before joining Cincinnati Microwave, Mr. Masavage was CFO of
Thomson Consumer Electronics' Canadian affiliate. Mr. Masavage joined the
Company in May 1994 and was appointed Vice President in May 1994 and Treasurer
and Secretary in January 1995.

Robert J. Brockman is Vice President/Commercial Products Marketing and
Sales. After ten years with the Power Generation Division of Babcock & Wilcox (a
manufacturer of steam generating equipment for utility and industrial power
generation), as R&D Program Manager, Mr. Brockman joined Bailey Controls Company
(a manufacturer of electronic process control equipment) as Manager, Product
Planning and Marketing. Mr. Brockman then served as Manager, Marketing and Sales
for the General Electric Company's Display Product Operations from 1985 to 1993.
Mr. Brockman joined the Company and was appointed Vice President in June 1994.

Craig V. Wolf is Vice President/Chief Financial Officer. Prior to joining
the Company on December 12, 1995, Mr. Wolf was General Manager of Armco
Financial Group and President of Armco Financial Services Corporation, two units
of Pittsburgh-based Armco, Inc. Prior to that, Mr. Wolf was corporate director
of internal audit for Armco, Inc. Between 1977 and 1989, Mr. Wolf served in a
number of domestic and international financial capacities for FMC Corporation.

Charles M. Fullgraf retired from P&G in 1982 after a 42-year career serving
P&G in various management positions. From 1978 to 1982 Mr. Fullgraf was a Group
Vice President of P&G and served on its Board of Directors. He also served as a
trustee of the P&G Profit Sharing Trust. He has been a Director of the Company
since 1985.

Joseph M. O'Donnell is currently Managing Director of his own consulting
firm. Mr. O'Donnell also has been President and Chief Executive Officer of
Computer Products, Inc. (a multi-national manufacturer of electronic products
and subsystems) since July 1994. Mr. O'Donnell was Chief Executive Officer of
Savin Corporation (a manufacturer of office products and equipment) from October
1993 to February 1994. From June 1990 through July 1992, Mr. O'Donnell was
President and Chief Executive Officer of GO/DAN Industries (a company that
manufactures and markets products for the automotive aftermarket business). From
October 1988 to May 1990, Mr. O'Donnell was Group Vice President of Handy &
Harmon (a company primarily involved in precious metals refining, stamping,
forging and fabrication headquartered in New York, New York); from August 1987
to September 1988 he was President of OD&S Ventures, Inc. (a venture capital
company). He has been a Director of the Company since 1991.

Gilbert L. Wachsman is currently Senior Vice President of Hard Lines of
Kmart Stores, Inc. and President of Wachsman Management Consulting, Inc., which
provides consulting services to retailers and consumer oriented manufacturers,
since 1990. Pursuant to his consulting practice, Mr. Wachsman served as Vice
Chairman of Universal International, Inc. (a wholesaler/retailer of close-out
merchandise) from October 1992 to February 1995. From December 1988 to July
1990, Mr. Wachsman was President of Lieberman Enterprises (a distributor of
pre-recorded music, video and personal computer software); from January 1986 to
December 1988 he was President of Child World, Inc. (one of the largest U.S. toy
chains). He has been a Director of the Company since 1991.

Erika Williams is currently President of the Erika Williams Group, a
consulting firm. Ms. Williams also is Chief Operating Officer of System
Integrators, Inc. (a company that designs, manufactures and markets services
publishing systems to the newspaper publishing industry). From 1993 to March
1995, Ms. Williams

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<PAGE> 28

was Senior Vice President and General Manager of Enterprise Storage Systems of
Amdahl Corporation (a developer and manufacturer of mainframe computers) of
Sunnyvale, California. Since 1978, Ms. Williams held various positions with
Amdahl Corporation including the Corporate Officer responsible for product
management of the main frame business, Vice President of Processor Technology
and Development and Director of Product Software and Diagnostics. She has been a
Director of the Company since 1994.

DESCRIPTION OF CAPITAL STOCK AND WARRANTS

The Company's authorized capital stock consists of 20,000,000 Common
Shares, without par value, and 100,000 Preferred Shares. As of November 1, 1995
the issued and outstanding capital stock of the Company consisted of 15,595,116
Common Shares. In addition, as of November 1, 1995, the Company had 1,073,620
Warrants issued and outstanding as described below.

The following summary of certain matters relating to the capital stock of
the Company is qualified in its entirety by the provisions of the Company's
Articles of Incorporation and Regulations.

COMMON STOCK

The Company had 15,595,116 Common Shares issued and outstanding on November
1, 1995. Holders of Common Shares are entitled to one vote for each share held
of record on all matters submitted to a vote of shareholders. Shareholders have
the right to cumulate their votes in the election of directors.

Holders of Common Shares are entitled to share in such dividends as the
Board of Directors, in its discretion, may validly declare from funds legally
available. In the event of liquidation, each outstanding Common Share entitles
its holder to participate ratably in the assets remaining after payment of
liabilities.

Shareholders have no preemptive or other rights to subscribe for or
purchase additional shares of any class of stock or any other securities of the
Company, and there are no redemption or sinking fund provisions with regard to
the Common Shares. All outstanding Common Shares are fully paid, validly issued
and non-assessable.

The vote of the holders of 66 2/3% of all outstanding Common Shares is
required to amend the Articles of Incorporation and to approve mergers,
reorganizations, and similar transactions.

PREFERRED STOCK

The Articles authorize the Board of Directors to designate and issue, from
time to time, Preferred Shares in one or more series. The Board of Directors is
authorized, to the extent permitted by applicable law, to fix and determine the
relative rights and preferences of the shares of any series so established with
respect to, among other things, dividend or distribution rights, the dates of
payments of dividends or distributions and the dates from which they are
cumulative, liquidation price, redemption rights and price, sinking fund
requirements, conversion or exchange rights and certain other terms of the
Preferred Shares. Because the rights and preferences set by the Board of
Directors for a series of Preferred Shares may be superior to the rights and
preferences of the Common Shares, the issuance of such series may adversely
affect the rights of the holders of Common Shares. As of the date of this
Amended Prospectus, the Board of Directors had not authorized or issued any
series of Preferred Shares and had no plans, agreements or understandings for
such authorization or issuance.

While issuance of Preferred Shares could provide needed flexibility in
connection with possible acquisitions and other corporate purposes, such
issuance also could make it more difficult for a prospective acquiror to acquire
a majority of the outstanding voting shares of the Company and could discourage
an attempt to gain control of the Company. Such authority granted to the Board
of Directors could adversely affect the market price of the Common Shares.

WARRANTS

Each Warrant entitles the holder thereof to purchase one of the Company's
Common Shares at an exercise price of $4.00 at any time prior to 5:00 p.m.,
Eastern Standard Time, on December 31, 1998. As of

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<PAGE> 29

November 1, 1995 1,073,620 Warrants were outstanding. The number of shares
purchasable upon exercise of the Warrants and the exercise price shall be
subject to adjustment to reflect, among other things, stock dividends on or
stock splits of the Common Shares or reclassification of the Common Shares. In
such situations, the number of shares purchasable upon exercise will be adjusted
so that the Warrant holder shall be entitled to receive the kind and number of
shares which the holder thereof would have owned or been entitled to receive
after the occurrence of any of such events if the Warrants had been exercised
prior thereto. The exercise price will be adjusted accordingly. The Warrants do
not confer upon the holders thereof any of the rights or privileges of a
shareholder. Accordingly, the Warrants do not entitle holders thereof to receive
any dividends, to vote, to call meetings or to receive any distribution upon a
liquidation of the Company. The Company has authorized and reserved for issuance
a number of Common Shares sufficient to provide for the exercise of the rights
represented by the Warrants. Shares issued upon exercise of the Warrants will be
fully paid and non-assessable. Warrants not exercised prior to 5:00 p.m.,
Eastern Standard Time, on December 31, 1998, shall become null and void.

The Warrants may be exercised during the exercise period stated above by
delivery of the Warrant Certificate, with the subscription form on the reverse
side of the Warrant Certificate fully executed, to the Company's transfer agent,
the State Street Bank And Trust Company, together with a check payable to the
State Street Bank And Trust Company in an amount equal to the Warrant exercise
price multiplied by the number of Common Shares being purchased. The Company or
its transfer agent will issue a new Warrant Certificate representing the
unexercised but not expired Warrants.

A complete statement of the terms and conditions pertaining to the Warrants
is contained in the Warrant Certificate, copies of which can be obtained from
the Company. This description is qualified in its entirety by the text of the
Warrant Certificate.

PROVISIONS EFFECTING BUSINESS COMBINATIONS

Chapter 1704 of the Ohio Revised Code may be viewed as having an
anti-takeover effect. This statute, in general, prohibits an "issuing public
corporation" (the definition of which would include the Company) from entering
into a "Chapter 1704 Transaction" with the beneficial owner (or affiliates of
such beneficial owner) of 10% or more of the outstanding shares of the
corporation (an "interested shareholder") for at least three years following the
date on which the interested shareholder attains such 10% ownership, unless the
board of directors of the corporation approves, prior to such person becoming an
interested shareholder, either the transaction or the acquisition of shares
resulting in a 10% ownership. A "Chapter 1704 Transaction" is broadly defined to
include, among other things, a merger or consolidation with, sale of substantial
assets to, or the receipt of a loan, guaranty or other financial benefit (which
is not proportionately received by all shareholders) by the interested
shareholder. Following the expiration of such three-year period, a Chapter 1704
Transaction with the interested shareholder is permitted only if either (i) the
transaction is approved by the holders of at least two-thirds of the voting
power of the corporation (or such different proportion as set forth in the
corporation's articles of incorporation), including a majority of the
outstanding shares, excluding those owned by the interested shareholder, or (ii)
the business combination results in the shareholders other than the interested
shareholder receiving a prescribed "fair price" for their shares. One
significant effect of Chapter 1704 is to cause an interested shareholder to
negotiate with the board of directors of a corporation prior to becoming an
interested shareholder.

In addition, Section 1707.043 of the Ohio Revised Code requires a person or
entity that makes a proposal to acquire the control of a corporation to repay to
that corporation any profits made from trades in the corporation's stock within
18 months after making the control proposal.

TRANSFER AGENT AND REGISTRAR

The registrar and transfer agent for the Company's Common Shares is the
State Street Bank and Trust Company, Boston, Massachusetts.

29
<PAGE> 30

PLAN OF DISTRIBUTION

The Units offered pursuant to the Offering were offered by the Company
directly to holders of its Common Shares. Roney & Co. ("Roney") was retained by
the Company to act as Dealer Manager in connection with the Offering. The Dealer
Manager coordinated all aspects of marketing of the Offering through the conduct
of informational meetings, the direct solicitation of certain identified
shareholders and the management of Soliciting Dealers that also solicited the
exercise of Rights. For acting as Dealer Manager, the Company paid the Dealer
Manager a fee equal to 3.0% of the Subscription Price per Unit received for
Units sold in this Offering with a minimum Dealer Manager fee of $175,000 and an
expense allowance equal to 0.25% of the Subscription Price received for the
Units. In addition, the Company reimbursed certain of the Dealer Manager's
expenses, including legal and other out-of-pocket expenses not to exceed
$90,000. The Company paid each Soliciting Dealer designated by an exercising
Right Holder on the Subscription Rights Certificate, including the Dealer
Manager, a fee (the "Solicitation Fee") up to 3.5% in respect of each Unit
purchased by such Right Holder, excluding those Units purchased by directors,
officers, employees and their affiliates.

Roney acted as financial advisor in connection with the Offering, including
providing assistance to the Company in determining the Subscription Price. The
Company agreed to pay Roney a financial advisory fee of $50,000. The $50,000
advisory fee was credited against fees received for Units sold in the Offering
in excess of $125,000. In addition, Roney may perform other financial advisory
and investment banking services for the Company in the future for which it may
receive compensation. Roney acted as a co-underwriter in a recently completed
offering of 1,150,000 Common Shares by the Company and 3,450,000 Common Shares
by James L. Jaeger, Chairman of the Board of Directors.

Other than the Dealer Manager and the Soliciting Dealers, the Company did
not employ any brokers, dealers or underwriters to solicit the exercise of
Rights in the Offering and, except as described herein, no other commissions,
fees or discounts were paid in connection with the Offering.

The Company has agreed to indemnify the Dealer Manager and the Soliciting
Dealers against certain liabilities, including civil liabilities under the
Securities Act, or contribute to payments which the Dealer Manager or the
Soliciting Dealers may be required to make in respect thereof.

The Company paid the fees and expenses of State Street Bank and Trust
Company, as Subscription Agent, and also agreed to indemnify the Subscription
Agent from certain liabilities in connection with the Offering.

The Company offered up to 20,000 Units at the Subscription Price to certain
members of Company management and other Company employees other than Jacques A.
Robinson, President, and James L. Jaeger, Chairman of the Board.

LEGAL MATTERS

The validity of the Common Shares and Warrants were passed upon for the
Company by Frost & Jacobs, 201 East Fifth Street, Cincinnati, Ohio 45202.

EXPERTS

The consolidated financial statements as of December 25, 1994 and December
26, 1993 and for each of the three years in the period ended December 25, 1994
included in this Amended Prospectus have been so included in reliance on the
report of Price Waterhouse LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.

ADDITIONAL INFORMATION

The Company has filed with the Commission a Registration Statement under
the Securities Act of 1933 with respect to the Common Shares offered hereby.
This Amended Prospectus does not contain all of the information set forth in the
Registration Statement and the exhibits and schedules thereto. For further

30
<PAGE> 31

information with respect to the Company and such Common Shares, reference is
hereby made to such Registration Statement and to the exhibits and schedules
thereto. The Registration Statement can be inspected without charge at the
office of the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, and copies may be obtained therefrom at prescribed rates.

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Exchange
Act and in accordance therewith files reports, proxy statements and other
information with the Securities and Exchange Commission (the "SEC"). Such
reports, proxy statements and other information can be inspected and copied at
the public reference facilities of the SEC, Room 1024, Judiciary Plaza, 450
Fifth Street, N.W., Washington, D.C. 20549, as well as the following SEC
Regional Offices: Seven World Trade Center, New York, NY 10048, and Northwestern
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, IL 60661. Copies
can be obtained from the SEC by mail at prescribed rates. Requests should be
directed to the SEC's Public Reference Section, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549. The Company's Common Shares are included
in the NASDAQ National Market system and reports and other information
concerning the Company may also be inspected and copied at the offices of The
Nasdaq Stock Market, Inc. at 1735 K Street, N.W. Washington, D.C. 20006.

31
<PAGE> 32

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Report of Independent Accountants.................................................... F-2
Balance Sheet as of December 26, 1993 and December 25, 1994 and
October 1, 1995 (unaudited)........................................................ F-3
Statement of Operations for the years ended December 27, 1992, December 26, 1993 and
December 25, 1994 and the unaudited nine month periods ended September 25, 1994 and
October 1, 1995.................................................................... F-4
Statement of Cash Flows for the years ended December 27, 1992, December 26, 1993 and
December 25, 1994 and the unaudited nine month periods ended September 25, 1994 and
October 1, 1995.................................................................... F-5
Statement of Shareholders' Equity as of December 27, 1992, December 26, 1993 and
December 25, 1994.................................................................. F-6
Notes to Financial Statements........................................................ F-7
</TABLE>

F-1
<PAGE> 33

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and
Shareholders of Cincinnati Microwave, Inc.

In our opinion, the accompanying balance sheet and the related statements
of operations, of cash flows, and of shareholders' equity present fairly, in all
material respects, the financial position of Cincinnati Microwave, Inc. and its
subsidiaries as of December 25, 1994 and December 26, 1993, and the results of
their operations and their cash flows for each of the three years in the period
ended December 25, 1994, in conformity with generally accepted accounting
principles. These financial statements are the responsibility of Cincinnati
Microwave, Inc. management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
statements in accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for the opinion expressed above.

/s/ Price Waterhouse LLP

PRICE WATERHOUSE LLP

Cincinnati, Ohio

February 3, 1995

F-2
<PAGE> 34

CINCINNATI MICROWAVE, INC.

BALANCE SHEET

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
DECEMBER 26, DECEMBER 25, OCTOBER 1,
1993 1994 1995
------------ ------------ -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents...................... $ 2,842 $ 40 $ 614
Accounts receivable (less allowances of $43 -
1994 and $2 - 1993).......................... 3,636 5,137 16,500
Inventories, net (Note 6)...................... 7,299 9,159 19,864
Property held for sale......................... 212 -- --
Other.......................................... 537 602 655
-------- -------- -------
Total Current Assets......................... 14,526 14,938 37,633
-------- -------- -------
Restricted cash................................ 134 505 308
Property, plant and equipment, less accumulated
depreciation (Note 7)........................ 14,086 14,543 14,194
Patents, trade names and other identifiable
intangible assets, net of accumulated
amortization of
$3,759 - 1994 and $3,459 - 1993.............. 1,345 1,045 820
Excess of purchase price over fair value of net
assets acquired, net of accumulated
amortization of
$5,973 - 1994 and $5,454 - 1993.............. 2,327 1,808 1,420
-------- -------- -------
Total Assets................................. $ 32,418 $ 32,839 $54,375
======== ======== =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable............................... $ 3,884 $ 8,627 $ 9,609
Current Portion of long-term debt (Note 10).... 6,001 600 4,501
Accrued taxes.................................. 1,461 1,468 62
Unearned revenue............................... 393 709 700
Current lease obligations (Note 8)............. 346 1,164 995
Other.......................................... 2,695 4,071 4,028
-------- -------- -------
Total Current Liabilities.................... 14,780 16,639 19,895
-------- -------- -------
Long term debt (Note 10)....................... -- 7,419 --
Lease obligations (Note 8)..................... 418 1,422 725
Unearned revenue - noncurrent.................. 390 457 365
Contingencies (Note 15)........................
Common shares, without par value ($.20 stated
value); 20,000,000 shares authorized;
17,053,120 shares issued in 1993 and 1994.... 3,411 3,411 3,641
Paid-in capital................................ 18,163 17,578 24,190
Retained earnings.............................. 37,181 26,921 22,919
Treasury stock at cost, 6,110,264 shares - 1994
and 6,225,658 shares - 1993.................. (41,925) (41,008) (17,360)
-------- -------- -------
Total Shareholders' Equity................... 16,830 6,902 33,390
-------- -------- -------
Total Liabilities and Shareholders' Equity... $ 32,418 $ 32,839 $54,375
======== ======== =======
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-3
<PAGE> 35
CINCINNATI MICROWAVE, INC.

STATEMENT OF OPERATIONS

(AMOUNTS IN THOUSANDS EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
FOR THE YEAR ENDED NINE MONTHS ENDED
---------------------------------------------- -------------------------------
DECEMBER 27, DECEMBER 26, DECEMBER 25, SEPTEMBER 25, OCTOBER 1,
1992 1993 1994 1994 1995
------------ ------------ ------------ ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net sales............................ $ 51,339 $ 58,461 $ 64,708 $41,341 $54,782
Cost of sales........................ 37,819 39,778 50,359 29,820 41,817
-------- -------- -------- ------- -------
Gross profit....................... 13,520 18,683 14,349 11,521 12,965
-------- -------- -------- ------- -------
Operating expenses:
Research & development............. 7,182 8,117 8,449 6,326 5,631
Selling............................ 10,707 10,391 12,671 9,152 8,307
Administrative..................... 3,057 3,259 3,253 2,409 3,575
-------- -------- -------- ------- -------
20,946 21,767 24,373 17,887 17,513
-------- -------- -------- ------- -------
Operating loss................... (7,426) (3,084) (10,024) (6,366) (4,548)
Gain on sale of marketable equity
securities......................... -- 1,435 -- -- --
Interest expense..................... (204) (521) (738) (459) (838)
Other income (expense), net (Note
14)................................ (1,128) 886 502 506 (54)
-------- -------- -------- ------- -------
Loss from continuing operations
before income taxes............ (8,758) (1,284) (10,260) (6,319) (5,440)
Income tax benefit (Note 9).......... -- -- -- -- (1,438)
-------- -------- -------- ------- -------
Loss from continuing
operations..................... (8,758) (1,284) (10,260) (6,319) (4,002)
Discontinued operations (Note 3)..... 1,449 -- -- -- --
-------- -------- -------- ------- -------
Loss before extraordinary item (7,309) (1,284) (10,260) (6,319) (4,002)
Realization of net operating loss
carryforward (Note 4).............. 869 -- -- -- --
-------- -------- -------- ------- -------
Net loss......................... $ (6,440) $ (1,284) $(10,260) $(6,319) $(4,002)
======== ======== ======== ======= =======
(Net loss) earnings per share (Note
1):
Continuing operations.............. $ (0.80) $ (0.12) $ (0.94) $ (0.58) $ (0.28)
Discontinued operations............ 0.13 -- -- -- --
Realization of net operating loss
carryforward..................... 0.08 -- -- -- --
-------- -------- -------- ------- -------
Net loss......................... $ (0.59) $ (0.12) $ (0.94) $ (0.58) $ (0.28)
======== ======== ======== ======= =======
Weighted average number of shares
outstanding........................ 10,919 10,691 10,880 10,864 14,175
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-4
<PAGE> 36

CINCINNATI MICROWAVE, INC.

STATEMENT OF CASH FLOWS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
FOR THE YEAR ENDED NINE MONTHS ENDED
---------------------------------------- ----------------------------
DECEMBER 27, DECEMBER 26, DECEMBER 25, SEPTEMBER 25, OCTOBER 1,
1992 1993 1994 1994 1995
------------ ------------ ------------ ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss.............................. $ (6,440) $ (1,284) $(10,260) $(6,319) $(4,002)
------------ ------------ ------------ ------------- -------------
Adjustments to reconcile net loss to
net cash provided by (used in)
operations:
Depreciation........................ 3,095 3,346 3,697 2,616 2,894
Amortization........................ 819 819 819 614 613
Loss (gain) on disposition of
property, plant and equipment..... 163 (738) (658) (658) --
Gain on sale of marketable equity
securities........................ -- (1,435) -- -- --
Increase in marketable equity
securities........................ (5,880) -- -- -- --
Net assets of discontinued
operations........................ 2,122 (175) (61) -- --
Diminution of long-term
investments....................... 1,400 -- -- -- --
Treasury stock issued as
compensation...................... 713 183 68 -- --
Other non-cash charges (credits),
net............................... (132) (142) 118 50 72
Changes in operating assets and
liabilities excluding discontinued
operations:
Accounts receivable................. (7) 262 (1,501) (92) (11,363)
Inventories......................... (3,745) 2,515 (1,860) (8,211) (10,705)
Other current assets................ (80) (401) (58) (373) (53)
Accounts payable.................... 7,497 (9,103) 4,743 6,410 982
Accrued taxes....................... 264 (353) 7 (18) (1,406)
Unearned revenue.................... 279 13 384 323 (101)
Other current liabilities........... (183) (535) 1,436 -- --
Other non-current operating assets
and liabilities................... 150 227 (7) 909 (43)
------------ ------------ ------------ ------------- -------------
Total adjustments/changes........... 6,475 (5,517) 7,127 1,570 (19,110)
------------ ------------ ------------ ------------- -------------
NET CASH PROVIDED BY (USED IN) OPERATING
ACTIVITIES............................ 35 (6,801) (3,133) (4,749) (23,112)
------------ ------------ ------------ ------------- -------------
CASH FLOW FROM INVESTING ACTIVITIES
Acquisition of property, plant and
equipment........................... (4,844) (1,766) (4,222) (3,265) (2,545)
Proceeds from sale of assets.......... 1,223 976 820 820 --
Proceeds from sale of marketable
equity securities................... -- 7,315 -- -- --
(Increase) decrease in restricted
cash................................ -- (134) (371) (200) 197
------------ ------------ ------------ ------------- -------------
NET CASH PROVIDED BY (USED IN)
INVESTING ACTIVITIES.............. (3,621) 6,391 (3,773) (2,645) (2,348)
------------ ------------ ------------ ------------- -------------
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from notes payable........... 6,000 1,500 12,125 9,440 9,097
Payments on notes payable............. (4,000) (1,499) (10,107) (6,169) (12,615)
Proceeds from lease obligations....... -- 1,213 2,526 1,670 --
Payments on lease obligations......... -- (297) (704) (424) (866)
Issuance of treasury stock............ -- 290 264 298 366
Issuance of Warrants.................. -- 1,631
Net proceeds of Stock and Units
offerings........................... -- -- -- -- 28,421
------------ ------------ ------------ ------------- -------------
NET CASH PROVIDED BY FINANCING
ACTIVITIES............................ 2,000 1,207 4,104 4,815 26,034
------------ ------------ ------------ ------------- -------------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS........................... (1,586) 797 (2,802) (2,579) 574
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD............................. 3,631 2,045 2,842 2,842 40
------------ ------------ ------------ ------------- -------------
CASH AND CASH EQUIVALENTS AT END OF
PERIOD................................ $ 2,045 $ 2,842 $ 40 $ 263 $ 614
============== ============== ============== ============== ==============
Supplemental cash flow disclosure:
Interest paid......................... $ 204 $ 521 $ 738 $ 459 $ 838
============== ============== ============== ============== ==============
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-5
<PAGE> 37

CINCINNATI MICROWAVE, INC.

STATEMENT OF SHAREHOLDERS' EQUITY

(AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
COMMON SHARES TREASURY STOCK
----------------------- PAID-IN RETAINED -----------------------
SHARES VALUE CAPITAL EARNINGS SHARES VALUE TOTAL
----------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance December 29, 1991............. 17,053,120 $ 3,411 $ 19,343 $ 44,905 (6,616,238) $ (44,291) $ 23,368
Net loss.............................. (6,440) (6,440)
Restricted shares expense............. 70 70
Cancellation of restricted shares..... 356 (36,761) (356) --
Treasury stock issued to Employee
Stock Ownership Plan................ (162) 41,221 238 76
Shares issued under stock option
plan................................ (36) 11,650 69 33
Issuance of shares as compensation.... (60) 15,347 102 42
Other................................. (538) 150,090 1,030 492
---------- -------- --------- --------- ---------- --------- ---------
Balance December 27, 1992............. 17,053,120 3,411 18,973 38,465 (6,434,691) (43,208) 17,641
Net loss.............................. (1,284) (1,284)
Shares issued under stock option
plan................................ (643) 151,850 933 290
Issuance of shares as compensation.... (167) 57,183 350 183
---------- -------- --------- --------- ---------- --------- ---------
Balance December 26, 1993............. 17,053,120 3,411 18,163 37,181 (6,225,658) (41,925) 16,830
Net loss.............................. (10,260) (10,260)
Shares issued under stock option
plan................................ (553) 109,625 817 264
Issuance of shares as compensation.... (32) 5,769 100 68
---------- -------- --------- --------- ---------- --------- ---------
Balance December 25, 1994............. 17,053,120 $ 3,411 $ 17,578 $ 26,921 (6,110,264) $ (41,008) $ 6,902
========== ======== ========= ========= ========== ========= =========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-6
<PAGE> 38

CINCINNATI MICROWAVE, INC.

NOTES TO FINANCIAL STATEMENTS

(DOLLARS IN THOUSANDS EXCEPT SHARE DATA)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

CASH AND CASH EQUIVALENTS

Cash and cash equivalents consist of cash in the bank, commercial paper and
various money market instruments with maturities of three months or less and are
carried at cost which approximates market value.

INVENTORIES

Inventories are stated at the lower of cost or market. Cost is determined
by the FIFO (first-in, first-out) method.

RESTRICTED CASH

Restricted cash consists of cash in the bank restricted as to its use for
customer credit card processing and lease commitments.

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment is stated at cost. Depreciation is computed
using the straight-line method over the estimated useful lives of the assets.
Buildings and improvements are depreciated over 5 to 40 years. Manufacturing,
test, and engineering equipment are depreciated over 1 to 7 years, while office,
computer and other equipment is depreciated over 1 to 5 years. Gain or loss
realized on disposition of properties is included in income. Major additions and
improvements are capitalized while maintenance and repairs are expensed.

INTANGIBLE ASSETS

Intangible assets are amortized using the straight-line method. Patents,
trade names and the excess of the purchase price over the fair value of net
assets acquired are being amortized over periods not to exceed fifteen years.
Intangible assets are considered impaired if net assets exceed the projected
future cash flows from the sales of related products.

REVENUE RECOGNITION

Revenue is recognized from sales when the product is shipped. The Company
provides a 30 day, money-back guarantee on the majority of its products. The
Company also provides, at no cost to its customers, a one year warranty on the
majority of its products. The Company records the estimated future costs of
returns and warranties in the year of the sale.

UNEARNED REVENUE

The Company offers two and five year warranties for a fee to certain
customers. Unearned revenue is amortized on a straight-line basis over the
warranty period.

EARNINGS PER SHARE

Earnings per share are computed based on the weighted average number of
shares of common stock outstanding during each period.

INCOME TAXES

Effective December 28, 1992, the Company adopted Statement of Financial
Accounting Standards (SFAS) 109 "Accounting for Income Taxes" by using the
prospective method. The effect of the change was not material to the results of
operations or financial condition of the Company. SFAS 109 requires the

F-7
<PAGE> 39

CINCINNATI MICROWAVE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

recognition of deferred tax assets and liabilities for the expected future tax
consequences of temporary differences between the carrying amounts and the tax
bases of assets and liabilities. SFAS 109 also requires that a valuation
allowance be established for deferred tax assets when it is more likely than not
that they will not be realized.

RECLASSIFICATION

Certain prior year amounts have been reclassified to conform to the 1994
presentation.

UNAUDITED FINANCIAL INFORMATION

In the opinion of management, the unaudited financial information as of and
for the nine months ended October 1, 1995 and September 25, 1994 contain all
adjustments consisting only of normal, recurring adjustments, necessary to
present fairly the results for the periods presented.

NOTE 2 -- RIGHTS AND STOCK OFFERING

In the first quarter of 1995, the Company completed a Rights Offering (the
Offering) of 1,482,435 units for $7 per unit; each unit consisted of two Common
Shares and one warrant entitling the holder to purchase one additional Common
Share for $4. The Offering generated net proceeds of $9.3 million.

The proceeds from the Offering were used to reduce debt and to increase
working capital. Offering costs of $175,000 included as a prepaid asset at
December 25, 1994 reduced Paid-in capital upon completion of the Offering.
2,964,870 shares of Treasury stock were reissued as part of the Offering.
Paid-in capital was reduced by the excess cost of the Treasury stock over the
net proceeds of the Offering.

(UNAUDITED SUBSEQUENT EVENT)

In the third quarter of 1995, the Company completed a Stock Offering of
4,600,000 Common Shares, of which 1,150,000 shares were sold by the Company and
3,450,000 were sold by a selling shareholder. The 1,150,000 shares sold by the
Company generated net proceeds of $19.1 million. The funds were used to pay
amounts outstanding under the existing revolving credit line and to fund an
anticipated growth in working capital.

NOTE 3 -- DISCONTINUED OPERATIONS

On March 27, 1992, the Company entered into a strategic partnership with BI
Incorporated ("BI"). In consummating this transaction, (i) a wholly owned
subsidiary of BI merged into Guardian Technologies, Inc. ("Guardian"), a wholly
owned subsidiary of the Company, and Guardian became a wholly owned subsidiary
of BI, and (ii) the Company and BI entered into an "original equipment
manufacturing" (OEM) agreement under which the Company would design and
manufacture home incarceration and related product offerings for BI. In the
merger transaction, in consideration for its Guardian shares, the Company
received 1,176,000 shares of BI common stock, or 16.5% of the outstanding BI
common stock. In consideration for entering into the OEM agreement, the Company
received $3,000 in cash.

The Company sold its investment in shares of BI through a private placement
of stock and on the open market through a broker, recognizing a gain of $1,435
in 1993.

The results of the Guardian/BI merger and the operating results of Guardian
have been classified as discontinued operations. Net sales of discontinued
operations were $1,510 for the twelve months ended

F-8
<PAGE> 40

CINCINNATI MICROWAVE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

December 27, 1992. The net operating results of Guardian were $110 through March
27, 1992. Results from discontinued operations are summarized below:

<TABLE>
<CAPTION>
DECEMBER 27,
FOR THE YEAR ENDED: 1992
- ------------------------------------------------------------------------------ ------------
<S> <C>
BI common shares received..................................................... $5,880
Expenses associated with the Guardian/BI merger............................... (1,484)
Book value of Guardian assets................................................. (2,254)
------------
Pretax gain on the Guardian/BI merger......................................... 2,142
Income tax expense............................................................ (803)
------------
Net gain on the Guardian/BI merger............................................ 1,339
Net operating results of Guardian, net of income tax expense of $66 in 1992... 110
------------
Discontinued operations....................................................... $1,449
============
</TABLE>

NOTE 4 -- EXTRAORDINARY ITEM

An extraordinary gain of $869 was recorded during the first quarter of 1992
to reflect the realization of a book net operating loss carryforward as a result
of the tax effect of the Guardian/BI merger and the tax effect of the operating
results from discontinued operations.

NOTE 5 -- SIGNIFICANT CUSTOMERS

Net sales to the Home Shopping Network amounted to $9,193 in 1994. Net
sales to Cobra Electronics Corporation, a division of Dynascan, amounted to
$7,426 in 1993 and $8,221 in 1992. One customer, AT&T, represented 26% and 12%
of the Company's net sales for the three and nine months ended October 1, 1995,
respectively (unaudited). No other customer accounted for 10% or more of the
Company's net sales.

NOTE 6 -- INVENTORIES

Inventories consisted of:

OCTOBER 1,
DECEMBER 26, DECEMBER 25, 1995
1993 1994 ----------
------------ ------------ (UNAUDITED)
<S> <C> <C> <C>
Materials and supplies............................. $6,006 $6,314 $ 11,082
Work in process.................................... 976 1,933 2,242
Finished goods..................................... 926 2,516 7,515
Inventory valuation reserve........................ (609) (1,604) (975)
------------ ------------ ----------
$7,299 $9,159 $ 19,864
============ ============ =========
</TABLE>

F-9
<PAGE> 41

CINCINNATI MICROWAVE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 7 -- PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consisted of:

<TABLE>
<CAPTION>
DECEMBER 26, DECEMBER 25,
1993 1994
------------ ------------
<S> <C> <C>
Land and improvements......................................... $ 755 $ 829
Building and improvements..................................... 12,005 12,030
Manufacturing, test and engineering equipment................. 13,530 17,455
Office and computer equipment................................. 5,946 6,071
Transportation equipment...................................... 107 57
------------ ------------
32,343 36,442
------------ ------------
Less accumulated depreciation................................. 18,257 21,899
------------ ------------
$ 14,086 $ 14,543
============ ============
</TABLE>

NOTE 8 -- LEASE OBLIGATIONS

The Company has entered into leasing arrangements for certain manufacturing
equipment under capital leases. The Company has the option to purchase certain
leased equipment for $1,322 upon expiration of the lease. The cost and
accumulated depreciation under capital leases included in property, plant, and
equipment are as follows:

<TABLE>
<CAPTION>
DECEMBER 26, DECEMBER 25,
1993 1994
------------ ------------
<S> <C> <C>
Manufacturing, test and engineering equipment................. $ 942 $ 3,548
Less accumulated depreciation................................. (306) (1,063)
------------ ------------
$ 636 $ 2,485
============ ============
</TABLE>

Future minimum lease payments under capital leases and the net present
value of the minimum lease payments as of December 25, 1994 are as follows:

<TABLE>
<S> <C>
1995....................................................................... $ 1,397
1996....................................................................... 1,024
1997....................................................................... 533
1998 and beyond............................................................ 0
------------
Total minimum lease payments................................................. 2,954
Amount representing interest................................................. (368)
------------
Net present value of minimum lease payments.................................. 2,586
Less current maturities...................................................... (1,164)
------------
Long-term maturities......................................................... $ 1,422
============
</TABLE>

F-10
<PAGE> 42

CINCINNATI MICROWAVE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 9 -- INCOME TAXES

Income taxes related to continuing operations were as follows for the
years:

<TABLE>
<CAPTION>
1992 1993 1994
-------- -------- --------
<S> <C> <C> <C>
Provision for income taxes (benefit):
Current federal....................................... $ 0 $ (416) $(2,481 )
Deferred federal...................................... 0 416 2,481
-------- -------- --------
$ 0 $ 0 $ 0
========= ========= =========
</TABLE>

Deferred income taxes are provided for those items for which the income tax
bases and the carrying amount of the assets and liabilities differ. The sources
of these differences and the tax effects of each are as follows:

<TABLE>
<CAPTION>
1992 1993 1994
-------- -------- --------
<S> <C> <C> <C>
Deferred income tax components:
Change in valuation allowance......................... 0 157 3,546
Marketable equity securities.......................... 0 (382) 0
Plant and equipment................................... 0 (116) (123 )
Investment in CDI..................................... 0 680 0
Other................................................. 0 77 (942 )
-------- -------- --------
Deferred income tax expense (benefit)................... $ 0 $ 416 $ 2,481
========= ========= =========
</TABLE>

Reconciliations between the statutory and effective income tax rates are as
follows:

<TABLE>
<CAPTION>
1992 1993 1994
-------- -------- --------
<S> <C> <C> <C>
Statutory U.S. federal income tax rate.................. (34.0)% (34.0)% (34.0)%
Change in valuation allowance........................... 0.0 12.2 31.0
Goodwill and other intangible amortization.............. 3.8 21.8 3.0
NOL carryforward not currently realizable............... 30.2 0.0 0.0
-------- -------- --------
Effective income tax rate............................. 0.0% 0.0% 0.0%
========= ========= =========
</TABLE>

F-11
<PAGE> 43

CINCINNATI MICROWAVE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

The components of deferred income tax assets and liabilities at December
25, 1994 and December 26, 1993 are as follows:

<TABLE>
<CAPTION>
DECEMBER 26, DECEMBER 25,
1993 1994
------------ ------------
<S> <C> <C>
Deferred tax assets:
Current
Inventories.............................................. $ 328 $ 727
Unearned revenue......................................... 211 397
Accrued vacation......................................... 113 142
Accrued warranty......................................... 88 131
Sales returns............................................ 158 114
Other.................................................... 54 57
------------ ------------
952 1,568
Noncurrent
NOL carryforward......................................... 3,290 6,113
Alternative minimum tax credit........................... 117 117
Other.................................................... 92 76
------------ ------------
3,499 6,306
Deferred tax assets valuation allowance....................... (3,572) (7,118)
------------ ------------
Deferred tax assets net of valuation allowance................ 879 756
Deferred tax liabilities:
Noncurrent
Plant and equipment...................................... (879) (756)
------------ ------------
Net deferred tax assets....................................... $ 0 $ 0
============ ============
</TABLE>

As required by SFAS 109, the Company has recorded a valuation allowance to
the extent that deferred tax assets exceed deferred tax liabilities as it is not
considered more likely than not that the assets will be realized.

At December 25, 1994, the Company had net operating loss (NOL)
carryforwards for federal income tax purposes of approximately $17,978, which
expire beginning in 2006. In 1991, the Company generated an alternative minimum
tax (AMT) credit of $117. This amount is allowable as a credit against the
excess of regular tax over AMT in future years. Under current federal tax laws,
this credit may be carried forward indefinitely.

(UNAUDITED SUBSEQUENT EVENT)

In March 1995, as a result of the closure of the Company's 1991 Federal tax
return, the Company released certain tax reserves to income. The adjustment
increased net income for the first quarter of 1995 by $1.4 million.

NOTE 10 -- NOTES PAYABLE

During 1993, the Company borrowed the maximum amount available under its
$7,500 line of credit at an interest rate of 6% per annum. As funds became
available from the sale of land and securities, payments were made to reduce the
credit facility to $5,730 at December 26, 1993. On December 31, 1993, the
Company and its lender agreed to extend the credit facility to April 30, 1994
and the Company agreed to make monthly principal payments of $100 in January
through April 1994. The line of credit was extended to May 31, 1994 and was
repaid in full on May 27, 1994 with the proceeds of a $10,000 financing with a
new bank (the "Bank").

F-12
<PAGE> 44

CINCINNATI MICROWAVE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

The financing agreement with the Bank included (i) a revolving line of
credit for general working capital and standby letters of credit maturing on
June 30, 1996 in the amount of up to $6,000 based upon a receivables and
inventory formula, bearing interest at the Bank's prime rate plus 3/4% per
annum or 9 3/4% at December 25, 1994; and (ii) a term loan from the Bank in the
amount of up to $4,000 initially due December 31, 1994, bearing interest at the
Bank's prime rate plus 1% per annum or 10% at December 25, 1994 (collectively,
the "Loans"). At December 25, 1994, the Company has borrowed $5,019 on the
revolving line of credit and $3,000 on the term loan.

At December 26, 1993, the Company had an outstanding unsecured note payable
of $271 related to the purchase of certain engineering equipment. This note was
paid in full during 1994. The interest rate on this note was 8%.

(UNAUDITED SUBSEQUENT EVENTS)

At October 1, 1995, the Company had borrowed $4.5 million (term loan
balance of $2.6 million and $1.9 million on the revolving credit facility)
against its credit facility due June 30, 1996. The $9.6 million credit facility
consists of (i) the term loan and (ii) a $7.0 million revolving credit facility
and (iii) a standby letter of credit facility not to exceed $1.0 million;
however, the sum of the outstanding principal balance of the revolving credit
and the aggregate amount of the Company's outstanding letters of credit shall
not exceed $7.0 million at any time. The credit facility is secured by a first
lien on the Company's inventory, receivables, equipment and a mortgage on the
real estate of the Company.

At October 1, 1995 the Company was in violation of one covenant of the
borrowing agreement because of the net loss incurred for the quarter. The
lending institution has waived this violation for the third quarter; however, as
a result of the covenant violation the lending institution has raised the
lending rates to prime plus 2.0% for the revolving loan, from prime plus 1.25%,
and prime plus 2.25% on the term loan, from prime plus 1.50%. Additionally,
similar net loss covenants exist that require the Company to report net income
for the fourth quarter and for the fiscal year ending December 31, 1995. The
Company expects that it will violate the covenants requiring net income for the
fourth quarter and the fiscal year. The Company will work with its lender to
seek a waiver of the related covenants. Although the lending institution waived
the similar covenant for the third quarter, there can be no assurances that such
a waiver will be granted in the future.

NOTE 11 -- CAPITAL SHARES

STOCK OPTIONS

The Company's 1991 Stock Option Plan (Plan) has reserved 2,000,000 shares
for issuance pursuant to incentive or non-qualified stock options to be granted
at a price equal to or greater than the market value at the date of grant. These
options become exercisable ratably over a four year period beginning six months
and one

F-13
<PAGE> 45

CINCINNATI MICROWAVE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

day from the date of grant and expire ten years after the date of grant. The
following is a summary of option activity under the Plan:

<TABLE>
<CAPTION>
DECEMBER 26, DECEMBER 25,
1993 1994
------------ ------------
<S> <C> <C>
Options outstanding at the beginning of year.................. 969,600 931,625
Options granted............................................... 317,500 304,000
Options exercised............................................. 151,850 109,625
Options cancelled............................................. 203,625 172,375
------------ ------------
Options outstanding at end of year............................ 931,625 953,625
------------ ------------
Options exercisable at end of year............................ 204,500 319,375
Common shares available for options to be granted at end of
year........................................................ 904,875 773,250
Option price range for options granted...................... $2.00 - $7.50 $4.125 - $11.625
Option price range for options exercised.................... $2.00 - $3.00 $2.00 - $3.00
Option price range for options exercisable at end of year... $2.00 - $3.00 $2.00 - $7.50
</TABLE>

In April 1991, the Company also granted options to purchase 500,000 shares
to the Scotcrest Group, Inc. (Scotcrest) in conjunction with a contract with
Scotcrest to provide the services of Jacques A. Robinson, President and Chief
Executive Officer of the Company. These options were granted at a price of $1.25
per share (market value at date of grant) and are exercisable at any time. These
options expire ten years from the date of grant. None of these options were
exercised or cancelled during 1994, 1993 or 1992.

In May 1992, the Company established the 1992 Stock Option Plan for
Non-Employee Directors. Under this plan, an option to purchase 5,000 common
shares shall be granted to each non-employee director on the date of the
Company's annual meeting of shareholders at or above the fair market value of
the stock. These options become exercisable six months from the date of issuance
and expire ten years after the date of grant. The Company has reserved for
issuance upon the exercise of options granted under this plan 150,000 Common
Shares. During 1994, 20,000 options to purchase common shares were issued to the
Company's four non-employee directors at a price of $8.375. During 1993, 15,000
options to purchase common shares were issued to the Company's three
non-employee directors at a price of $4.375.

DIRECTORS' STOCK COMPENSATION

In July 1991, the Company established a Directors' Restricted Share Plan.
This plan provides that each director shall receive seventy percent of his total
annual compensation in the form of stock, restricted as to disposition for six
months. The stock will be granted at a price equal to the average market price
for the prior twelve months. This plan has a term of ten years and provides that
the aggregate number of shares of common stock which may be awarded may not
exceed 500,000 shares. Shares issued and related expense recorded under the plan
were 5,769 and $47 during 1994, 15,186 and $47 during 1993 and 15,347 and $42
during 1992.

EXECUTIVE STOCK COMPENSATION

During 1993, Jacques A. Robinson and James L. Jaeger, Chairman of the
Board, agreed to receive certain compensation in the form of the Company's stock
in lieu of cash payments. Total treasury shares issued were 30,992 for Mr.
Robinson and 11,005 for Mr. Jaeger with market values of $78 and $27,
respectively.

F-14
<PAGE> 46

CINCINNATI MICROWAVE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 12 -- EMPLOYEE BENEFIT PLANS

The Company has a defined contribution retirement plan and a defined
contribution profit sharing plan covering substantially all of its employees.
The costs of employee benefit plans are charged to expense and funded throughout
the year. Total costs for these plans were $769 in 1994, $881 in 1993, and $710
in 1992.

NOTE 13 -- RELATED PARTY TRANSACTIONS

Until June 21, 1993, the President and Chief Executive Officer of the
Company was a director of BI Incorporated ("BI"), an OEM customer of the
Company. Net revenues generated from the sale of products to BI amounted to
$2,596 for the year ended December 26, 1993 and $2,393 for the year ended
December 27, 1992. The Company had outstanding accounts receivable from BI of
$390 at December 26, 1993 and $515 at December 27, 1992. Subsequent to December
25, 1994, the Company and BI terminated their manufacturing agreement.

The Company owned approximately 6% of the stock of Cellular Data Inc.
("CDI") (see Note 14). CDI was a development stage company formed to develop and
market a technology to transmit data over cellular telephone networks without
using or interfering with the radio spectrum allocated for voice transmission on
those networks. In accordance with an agreement with CDI, the Company provided
engineering services of $374 to CDI in 1993. These costs are included in
research and development expenses. In addition, James L. Jaeger owned
approximately 3% of the stock of CDI.

NOTE 14 -- OTHER INCOME (EXPENSE), NET

Other income (expense), net consists of the following:

<TABLE>
<CAPTION>
FOR THE YEAR ENDED
----------------------------------------------
DECEMBER 28, DECEMBER 26, DECEMBER 25,
1992 1993 1994
------------ ------------ ------------
<S> <C> <C> <C>
Diminution of investment in CDI............... $ (1,400)
Gain (loss) on disposition of fixed assets.... (163) 738 $ 658
Interest and dividend income.................. 64 189 7
Other income/(expense)........................ 371 (41) (163)
------------ ------ ------------
$ (1,128) $886 $ 502
============ ============ ============
</TABLE>

A loss of $1,400 was recorded in the quarter ended March 29, 1992, to
reflect the diminution of the Company's investment in Cellular Data, Inc.
("CDI"). CDI is a development stage company that was formed to develop and
market a technology to transmit data over cellular telephone networks without
using or interfering with the radio spectrum allocated for voice transmission on
those networks. During 1992, the market saw the entry of major
telecommunications companies. Still in the research and development stage, CDI
had yet to generate material revenues and required further substantial infusions
of cash. In the Company's judgment, such infusions were deemed highly dilutive
to the Company's investment. As a result, the Company reflected the CDI
investment as having no book value, and the write down of $1,400 was recorded in
the first quarter of 1992. In October 1993, CDI ceased business operations and
was liquidated.

NOTE 15 -- CONTINGENCIES (UNAUDITED SUBSEQUENT EVENT)

Four shareholder suits were filed against the Company in October and
November 1995. The lawsuits allege that the Company and other defendants
violated various sections of the Securities Act of 1933 and the Securities
Exchange Act of 1934 in connection with the public offering of 4,600,000 common
shares in August-September 1995 and otherwise in connection with the market for
the Company's Common Shares. The Company is presently evaluating the allegations
contained in these lawsuits and intends to vigorously defend itself. No accrual
for loss has been recorded as the Company is unable to estimate the range of
loss, if any.

F-15
<PAGE> 47

- ------------------------------------------------------
- ------------------------------------------------------

NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS
AMENDED PROSPECTUS IN CONNECTION WITH THE OFFER MADE HEREBY. IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR THE AGENT. THIS AMENDED PROSPECTUS DOES NOT
CONSTITUTE AN OFFER OF ANY SECURITIES OTHER THAN THOSE TO WHICH IT RELATES OR AN
OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN ANY SUCH
JURISDICTION. NEITHER THE DELIVERY OF THIS AMENDED PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF.

------------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary..................... 5
Recent Developments.................... 6
Risk Factors........................... 6
Use of Proceeds........................ 11
Price Range of Common Shares and
Warrants............................. 11
Dividend Policy........................ 11
Capitalization......................... 12
Dilution............................... 13
Selected Consolidated Financial Data... 14
Management's Discussion and Analysis of
Financial Condition and Results of
Operations........................... 15
Business............................... 20
Management............................. 26
Description of Capital Stock and
Warrants............................. 28
Plan of Distribution................... 30
Experts................................ 30
Additional Information................. 30
Available Information.................. 31
</TABLE>

------------------------------------------------------
------------------------------------------------------

Up to 1,073,620 Common Shares

CINCINNATI MICROWAVE, INC.

------------------------

AMENDED PROSPECTUS

------------------------

December 13, 1995

------------------------------------------------------
------------------------------------------------------
<PAGE> 48

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. (1)

<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee.................... $ 10,614.38
NASDAQ Listing Fees.................................................... 3,000.00
NASD Filing Fee........................................................ 2,297.39
Printing and Engraving................................................. 180,000.00
Counsel fees and expenses.............................................. 210,000.00
Accountant's fees and expenses......................................... 85,000.00
Blue Sky Qualification fees and expenses............................... 5,000.00
Miscellaneous fees and expenses........................................ 4,088.23
-----------
Total............................................................. $500,000.00
===========
<FN>

- ---------

(1) Estimated, other than Registration Fee and NASD Filing Fee.
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

There is no provision in the Company's Amended Articles of Incorporation by
which an officer or director of the Company may be indemnified against any
liability which he may incur in his capacity as such. However, the Company has
indemnification provisions in its Amended Regulations. These provisions provide
that each person who was or is a party or is threatened to be made a party to or
is involved in any threatened, pending or completed action, suit or proceeding,
("Proceeding") by reason of the fact that he or she, or a person of whom he or
she is the legal representative, is or was a director or officer, employee, or
agent of the corporation or, as a director or officer of the Corporation, is or
was serving at the request of the corporation as a director, officer, trustee,
employee, or agent of another corporation, partnership, joint venture, trust or
other enterprise, including service with respect to employee benefit plans,
whether the basis of such Proceeding is alleged action in an official capacity
as a director, officer, trustee, employee or agent or in any other capacity,
shall be indemnified by the Company to the fullest extent authorized by law,
including but not limited to the Ohio General Corporation Law, as the same
exists or may hereafter be amended (but, in the case of any such amendment, only
to the extent that such amendment permits the Company to provide broader
indemnification rights than such law permitted the Company to provide prior to
such amendment), against all expenses, liability and loss (including attorneys'
fees, and in respect of claims not made by or in the right of the Company,
judgments, fines, ERISA, excise taxes or penalties and amounts paid or to be
paid in settlement) actually and reasonably incurred by such person in
connection with any such Proceeding; provided, however, that the Company shall
indemnify any such person seeking indemnity in connection with an action, suit
or proceeding initiated by such person only if such action, suit or proceeding
initiated by such person was authorized by the Board of Directors.

In the event that any claim for indemnification is not paid in full by the
Company within 30 days, the claimant is entitled to bring suit against the
Company to recover the amount not paid and, if the claimant is successful, the
cost of the Proceeding that was required to order that payment. In addition, the
rights to reimbursement under these indemnification provisions represent a
contract right that entitles the indemnified party to bring suit to enforce the
indemnification provisions as if such provisions were set forth in a separate
written contract between the Company and the party to be indemnified. The
Company may purchase and maintain insurance or furnish similar protection on
behalf of any person (qualified to be indemnified) against any liability
asserted against him, and incurred by him in or arising out of his indemnifiable
status, whether or not the Company would have the power to indemnify him against
such liability.

The Company provides liability insurance for its directors and officers for
certain losses arising from certain claims and charges, including claims and
charges under the Securities Act, which may be made against such persons while
acting in their capacities as directors and officers of the Company.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended (the "Securities Act") may be permitted to directors,
officers and controlling persons of the Company pursuant to

II-1
<PAGE> 49

the provisions referred to herein, or otherwise, the Company has been advised
that in the opinion of the SEC such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.

ITEM 16. EXHIBITS.

<TABLE>
<CAPTION>
EXHIBIT NO. TITLE OF EXHIBIT
----------- ----------------
<S> <C>
(1) Dealer Manager Agreement

(4)(i) Articles of Incorporation of Cincinnati Microwave, Inc., as amended
(incorporated by reference to Exhibit 4(i) of Registration Statement
No. 33-61775).

(4)(ii) Regulations of Cincinnati Microwave, Inc., as amended (incorporated by
reference to Exhibit 4(ii) of Registration Statement No. 33-61775).

(5) Opinion of Frost & Jacobs, counsel for the Company, as to the legality
of the Securities being registered.

(10)(i) Copy of Loan and Security Agreement dated as of May 27, 1994 between
The Huntington National Bank and Cincinnati Microwave, Inc., as
amended (incorporated by reference to Exhibit (10)(ii) of Registration
Statement No. 33-61775).

(10)(iii)(A)(1)* Copy of the Cincinnati Microwave, Inc. 1991 Stock Option Plan for
Employees (incorporated by reference to Exhibit 10.1 to Form 10-K for
1991, File No. 0-13136).

(10)(iii)(A)(2)* Form of stock option agreement used previously in connection with the
options granted under the Cincinnati Microwave, Inc. 1991 Stock Option
Plan for Employees (incorporated by reference to Exhibit 10.2 to Form
10-K for 1991, File No. 0-13136).

(10)(iii)(A)(3)* Copy of resolutions pertaining to Directors' fees (incorporated by
reference to Exhibit 10(k) of Registration Statement No. 2-86869).

(10)(iii)(A)(4)* Copy of Employment Agreement dated as of December 22, 1988 by and
between R. Gregory Blair and Cincinnati Microwave, Inc. (incorporated
by reference to Exhibit 10.10 to Form 10-K for 1988, File No.
0-13136).

(10)(iii)(A)(5)* Copy of Employment Agreement dated as of October 2, 1992 by and
between John W. Noland and Cincinnati Microwave, Inc. (incorporated by
reference to Exhibit 10(5) to Form 10-K for 1992, File No. 0-13136).

(10)(iii)(A)(6)* Copy of the Cincinnati Microwave Deferred Compensation Plan
(incorporated by reference to Exhibit (10)(26) to Form 10-K for 1987,
File No. 0-13136).

(10)(iii)(A)(7)* Copy of the Cincinnati Microwave, Inc. Retirement Savings Plan
(incorporated by reference to Exhibit (10)(19) to Form 10-K for 1991,
File No. 0-13136).

(10)(iii)(A)(8)* Copy of the Cincinnati Microwave, Inc. Employees Stock Ownership Trust
(incorporated by reference to Exhibit (10)(21) to Form 10-K for 1988,
File No. 0-13136).

(10)(iii)(A)(9)* Copy of the Cincinnati Microwave, Inc. Profit Sharing Plan
(incorporated by reference to Exhibit (10)(21) to Form 10-K for 1991,
File No. 0-13136).

(10)(iii)(A)(10)(i)* Copy of the Services Agreement with the Scotcrest Group, Inc.
effective March 25, 1991 (incorporated by reference to Exhibit
(10)(22) to Form 10-K for 1991, File No. 0-13136).

(10)(iii)(A)(10)(ii)* Copy of Amended Service Agreement with the Scotcrest Group, Inc.
effective March 27, 1992 (incorporated by reference to Exhibit 1 to
Form 10-Q for the quarter ended March 27, 1992, File No. 0-13136).

(10)(iii)(A)(10)(iii)* Copy of Amended Service Agreement with the Scotcrest Group, Inc.
effective May 16, 1995 (incorporated by reference to Exhibit 10(i) of
Registration Statement No. 33-61775).
</TABLE>

II-2
<PAGE> 50

<TABLE>
<CAPTION>
EXHIBIT NO. TITLE OF EXHIBIT
---------- ----------------
<S> <C>
(10)(iii)(A)(11)* Copy of Cincinnati Microwave, Inc. 1992 Stock Option Plan for
Non-Employee Directors effective May 19, 1992 (incorporated by
reference to Exhibit 1 to Form 10-Q for the quarter ended September
27, 1992, File No. 0-13136).

(10)(iii)(A)(12)* Copy of stock option agreement used in connection with Cincinnati
Microwave, Inc. 1992 Stock Option Plan for Non-Employee Directors
(incorporated by reference to Exhibit 2 to Form 10-Q for the quarter
ended September 27, 1992, File No. 0-13136).

(23)(A) Consent of Price Waterhouse LLP.

(23)(B) Consent of Frost & Jacobs is contained in opinion of counsel filed as
Exhibit 5.

(24) Powers of Attorney executed by directors and officers other than Erika
Williams.

(24)(i) Power of Attorney executed by Erika Williams.

(99)(i) Form of Subscription Rights Certificate

(99)(ii) Form of Instructions as to Use of Subscription Rights Certificate

(99)(iii) Form of Letter to Shareholders

(99)(iv) Form of Letter to Shareholders with Addresses Outside the United
States and Canada or APO or FPO Addresses

(99)(v) Form of Letter to Nominee Holders

(99)(vi) Form of Certification and Request for Additional Rights

(99)(vii) Form of Nominee Holder Oversubscription Certification

(99)(viii) Form of Letter from Nominee Holders to Beneficial Owners

(99)(ix) Form of Notice of Guaranteed Delivery

(99)(x) Form of DTC Participant Oversubscription Exercise Form

(99)(xi) Executed Standby Purchase Agreements

(99)(xii) Form of Subscription Agent Agreement

(99)(xiii) Form of Information Agent Agreement

(99)(xiv) Form of Warrant

(99)(xv) Form of Warrant Agent Agreement

(99)(xvi) Form of Certificate of Amendment

(99)(xvii) Form of Instructions as to Use of Certificate of Amendment

(99)(xviii) Form of Letter to Shareholders or Right Holders

(99)(xix) Form of Letter to Persons Who Have Exercised Rights
<FN>

- ---------

* Management contract on compensatory plan or arrangement.
</TABLE>

ITEM 17. UNDERTAKINGS.

The undersigned registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:

(i)To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after
the effective date of the most recent post-effective amendment which,
individually or in the aggregate, represent a fundamental change in the
information set forth in the 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.

(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

II-3
<PAGE> 51

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.

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.

II-4
<PAGE> 52

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-2 and has duly caused this amendment to
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized in the City of Cincinnati, State of Ohio on the 13th day of
December, 1995.

CINCINNATI MICROWAVE, INC.

By: /s/ JACQUES A. ROBINSON

----------------------------------

Jacques A. Robinson

President and Chief Executive
Officer

As required by the Securities Act of 1933, this amendment to this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated below.

<TABLE>
<S> <C>
Principal Executive Officer:
/s/ JACQUES A. ROBINSON Dated: December 13, 1995
- -------------------------------------
Jacques A. Robinson, President,
Chief Executive Officer and Director
Principal Financial and
Accounting Officer:
/s/ WALTER P. MASAVAGE Dated: December 13, 1995
- -------------------------------------
Walter P. Masavage,
Vice President/Finance, Treasurer and
Secretary
</TABLE>

Directors:

CHARLES M. FULLGRAF

JOSEPH M. O'DONNELL
GILBERT L. WACHSMAN
ERIKA WILLIAMS

/s/ JACQUES A. ROBINSON

------------------------------------

Jacques A. Robinson, as
attorney-in-fact

Dated: December 13, 1995

<TABLE>
<S> <C>
/s/ JAMES L. JAEGER Dated: December 13, 1995
- -------------------------------------
James L. Jaeger, Director
</TABLE>

II-5
<PAGE> 53

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT NO. TITLE OF EXHIBIT
---------- ----------------
<S> <C> <C>
(1) Dealer Manager Agreement A

(4)(i) Articles of Incorporation of Cincinnati Microwave, Inc., as
amended (incorporated by reference to Exhibit 4(i) of
Registration Statement No. 33-61775).

(4)(ii) Regulations of Cincinnati Microwave, Inc., as amended
(incorporated by reference to Exhibit 4(ii) of Registration
Statement No. 33-61775).

(5) Opinion of Frost & Jacobs, counsel for the Company, as to A
the legality of the Securities being registered.

(10)(i) Copy of Loan and Security Agreement dated as of May 27,
1994 between The Huntington National Bank and Cincinnati
Microwave, Inc., as amended (incorporated by reference to
Exhibit (10)(ii) of Registration Statement No. 33-61775).

(10)(iii)(A)(1)* Copy of the Cincinnati Microwave, Inc. 1991 Stock Option
Plan for Employees (incorporated by reference to Exhibit
10.1 to Form 10-K for 1991, File No. 0-13136).

(10)(iii)(A)(2)* Form of stock option agreement used previously in
connection with the options granted under the Cincinnati
Microwave, Inc. 1991 Stock Option Plan for Employees
(incorporated by reference to Exhibit 10.2 to Form 10-K for
1991, File No. 0-13136).

(10)(iii)(A)(3)* Copy of resolutions pertaining to Directors' fees
(incorporated by reference to Exhibit 10(k) of Registration
Statement No. 2-86869).

(10)(iii)(A)(4)* Copy of Employment Agreement dated as of December 22, 1988
by and between R. Gregory Blair and Cincinnati Microwave,
Inc. (incorporated by reference to Exhibit 10.10 to Form
10-K for 1988, File No. 0-13136).

(10)(iii)(A)(6)* Copy of the Cincinnati Microwave Deferred Compensation Plan
(incorporated by reference to Exhibit (10)(26) to Form 10-K
for 1987, File No. 0-13136).

(10)(iii)(A)(7)* Copy of the Cincinnati Microwave, Inc. Retirement Savings
Plan (incorporated by reference to Exhibit (10)(19) to Form
10-K for 1991, File No. 0-13136).

(10)(iii)(A)(8)* Copy of the Cincinnati Microwave, Inc. Employees Stock
Ownership Trust (incorporated by reference to Exhibit
(10)(21) to Form 10-K for 1988, File No. 0-13136).

(10)(iii)(A)(9)* Copy of the Cincinnati Microwave, Inc. Profit Sharing Plan
(incorporated by reference to Exhibit (10)(21) to Form 10-K
for 1991, File No. 0-13136).

(10)(iii)(A)(10)(i)* Copy of the Services Agreement with the Scotcrest Group,
Inc. effective March 25, 1991 (incorporated by reference to
Exhibit (10)(22) to Form 10-K for 1991, File No. 0-13136).

(10)(iii)(A)(10)(ii)* Copy of Amended Service Agreement with the Scotcrest Group,
Inc. effective March 27, 1992 (incorporated by reference to
Exhibit 1 to Form 10-Q for the quarter ended March 27,
1992, File No. 0-13136).
</TABLE>

<PAGE> 54

<TABLE>
<CAPTION>
EXHIBIT NO. TITLE OF EXHIBIT
- ---------------------- -----------------------------------------------------------
<S> <C> <C>
(10)(iii)(A)(10)(iii)* Copy of Amended Service Agreement with the Scotcrest Group,
Inc. effective May 16, 1995 (incorporated by reference to
Exhibit 10(i) of Registration Statement No. 33-61775).

(10)(iii)(A)(11)* Copy of Cincinnati Microwave, Inc. 1992 Stock Option Plan
for Non-Employee Directors effective May 19, 1992
(incorporated by reference to Exhibit 1 to Form 10-Q for
the quarter ended September 27, 1992, File No. 0-13136).

(10)(iii)(A)(12)* Copy of stock option agreement used in connection with
Cincinnati Microwave, Inc. 1992 Stock Option Plan for
Non-Employee Directors (incorporated by reference to
Exhibit 2 to Form 10-Q for the quarter ended September 27,
1992, File No. 0-13136).

23(A) Consent of Price Waterhouse LLP.

23(B) Consent of Frost & Jacobs is contained in opinion of A
counsel filed as Exhibit 5.

(24) Powers of Attorney executed by directors and officers other A
than Erika Williams.

(24)(i) Power of Attorney executed by Erika Williams. A

(99)(i) Form of Subscription Rights Certificate A

(99)(ii) Form of Instructions as to Use of Subscription Rights A
Certificate

(99)(iii) Form of Letter to Shareholders A

(99)(iv) Form of Letter to Shareholders with Addresses Outside the A
United States and Canada or APO or FPO Addresses

(99)(v) Form of Letter to Nominee Holders A

(99)(vi) Form of Certification and Request for Additional Rights A

(99)(vii) Form of Nominee Holder Oversubscription Certification A

(99)(viii) Form of Letter from Nominee Holders to Beneficial Owners A

(99)(ix) Form of Notice of Guaranteed Delivery A

(99)(x) Form of DTC Participant Oversubscription Exercise Form A

(99)(xi) Executed Standby Purchase Agreements A

(99)(xii) Form of Subscription Agent Agreement A

(99)(xiii) Form of Information Agent Agreement A

(99)(xiv) Form of Warrant A

(99)(xv) Form of Warrant Agent Agreement A

(99)(xvi) Form of Certificate of Amendment A

(99)(xvii) Form of Instructions as to Use of Certificate of Amendment A

(99)(xviii) Form of Letter to Shareholders or Right Holders A

(99)(xix) Form of Letter to Persons Who Have Exercised Rights A
<FN>

- ---------

* Management contract on compensatory plan or arrangement.
</TABLE>

A Previously filed.

<PAGE> 1

Exhibit 23(A)

CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------

We hereby consent to the use in the Amended Prospectus constituting part of
this Registration Statement on Form S-2 of our report dated February 3, 1995
relating to the financial statements of Cincinnati Microwave, Inc. for the year
ended December 25, 1994 which appears in such Prospectus. We also consent to
the references to us under the headings "Experts" and "Selected Consolidated
Financial Data" in such Prospectus. However, it should be noted that Price
Waterhouse LLP has not prepared or certified such "Selected Consolidated
Financial Data."

/s/ Price Waterhouse LLP
- --------------------------------
Price Waterhouse LLP
Cincinnati, Ohio
December 11, 1995