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PROSPECTUS
HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED
20,000 SHARES
COMMON STOCK
(PAR VALUE, $.01 PER SHARE)
This Prospectus ("Prospectus") relates to 20,000 shares (the
"Shares") of common stock, $.01 par value per share (the "Common
Stock"), of Harman International Industries, Incorporated, a Delaware
corporation (the "Company"). The Shares may be offered by the
stockholder of the Company named herein (the "Selling Stockholder")
in transactions on the open market or in negotiated transactions or a
combination of such methods, at market prices prevailing at the time of
sale or at negotiated prices. On October 9, 1997, the closing sale price
of the Common Stock on the NYSE was $53.875. The Selling
Stockholder may effect such transactions by selling the Shares to
or through broker-dealers, and such broker-dealers may receive
compensation in the form of discounts or commissions from the Selling
Stockholder and/or the purchasers of the Shares for whom such broker-
dealers may act as agents or to whom they sell as principals, or both.
See "Selling Stockholder" and "Manner of Distribution."
All of the Shares offered hereunder are to be sold by the Selling
Stockholder. None of the proceeds from the sale of the Shares by the
Selling Stockholder will be received by the Company. The Company
has agreed to bear all expenses (other than discounts or commissions) in
connection with the registration and sale of the Shares being offered by
the Selling Stockholder.
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 PROSPECTUS IS OCTOBER 10, 1997.
No person has been authorized to give any information or to make
any representations other than those contained in this Prospectus in
connection with the offering made by this Prospectus and, if given or
made, such information or representations must not be relied upon as
having been authorized by the Company. This Prospectus does not
constitute an offer to sell, or the solicitation of an offer to buy, the
securities offered hereby in any jurisdiction to any person to whom it is
unlawful to make an offer or solicitation. Except where
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otherwise indicated, this Prospectus speaks as of the date hereof. The
delivery of this Prospectus shall not, under any circumstances, create
any implication that there has been no change in the affairs of the
Company since the date hereof.
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange
Commission (the "Commission") a Registration Statement on Form S-3
(herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act with respect to the
shares of Common Stock offered hereby. This Prospectus does not
contain all of the information set forth in the Registration Statement,
certain parts of which have been omitted in accordance with the rules
and regulations of the Commission. Statements made in this Prospectus
as to the contents of any contract, agreement or other document referred
to herein are not necessarily complete; with respect to each such
contract, agreement or other document filed as an exhibit to the
Registration Statement, reference is made to such exhibit for a more
complete description of the matter involved, and each such statement
shall be deemed qualified in its entirety by such reference. Copies of
the Registration Statement and the exhibits may be inspected, without
charge, at the offices of the Commission, or obtained at prescribed rates
from the Public Reference Section of the Commission at Room 1024,
450 Fifth Street, N.W., Washington, D.C. 20549.
The Company's Common Stock is listed on the NYSE. The
Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other
information with the Commission which may be inspected and copied at
the public reference facilities maintained by the Commission at Room
1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at certain
Regional Offices of the Commission: 500 West Madison Street, Suite
1400, Chicago, Illinois 60661 and 7 World Trade Center, Suite 1300,
New York, New York 10048. Copies of such material may be obtained
from the Public Reference Section of the Commission, at prescribed
rates. In addition, such reports, proxy statements and other information
may be inspected at the offices of the New York Stock Exchange, Inc.,
20 Broad Street, New York, New York 10005.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
In accordance with the requirements of the Exchange Act, the
Company periodically files certain reports and other information with
the Commission. The Company's Annual Report on Form 10-K, for the
year ended June 30, 1997 filed with the Commission is hereby
incorporated in this Prospectus by reference.
All documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to
the date of this Prospectus and prior to the termination of the offering
made hereby shall be deemed to be incorporated by reference in this
Prospectus and to be part hereof from the date of filing of such
documents. Any statement contained in a document incorporated by
reference herein shall be deemed to be modified or superseded for
purposes of this Prospectus to the extent that a statement contained
herein or in any other subsequently filed document which is also
incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this
Prospectus.
The Company will provide without charge to each person to whom
this Prospectus is delivered, upon the written or oral request of any such
person, a copy of the documents incorporated by reference in this
Prospectus (other than exhibits to such documents unless such exhibits
are specifically incorporated by reference into such documents). Such
requests should be directed to Harman International Industries,
Incorporated, 1101 Pennsylvania Avenue, N.W., Suite 1010,
Washington, D.C. 20004 (telephone number (202) 393-1101),
Attention: Bernard A. Girod, President.
THE COMPANY
Harman International Industries, Incorporated (together with its
subsidiaries, "Harman" or the "Company") is a worldwide leader in the
design, manufacture and marketing of high-quality, high-fidelity audio
products targeted primarily at the consumer, professional and original
equipment manufacturer ("OEM") markets. For almost 50 years, the
Company and its predecessors have been leaders and innovators in
creating loudspeaker and electronic products that deliver superior sound.
The Company was incorporated in Delaware in 1980. The
Company's principal executive offices are located at 1101 Pennsylvania
Avenue, N.W., Suite 1010, Washington, D.C. 20004. The Company's
telephone number is (202) 393-1101.
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RISK FACTORS
DEPENDENCE ON KEY CUSTOMERS
Sales to Chrysler accounted for 9.9% of the Company's consolidated
net sales for the fiscal year ended June 30, 1997. The Company's next
two largest customers together accounted for 12.0%, in the aggregate, of
its consolidated net sales for the fiscal year ended June 30, 1997. The
loss of any one of these significant customers could have a material
adverse effect on the Company.
DEPENDENCE ON CONSUMER SPENDING
The Company's sales are dependent to a substantial extent on
discretionary spending by consumers, which may be adversely impacted
by economic conditions affecting disposable consumer income and
retail sales. In addition, sales of the Company's audio products to the
automotive OEM market are dependent on the overall success of the
automobile industry, as well as the willingness, in many instances, of
automobile purchasers to pay for the option of a premium branded
automotive audio system.
ACQUISITION STRATEGY
A significant element of the Company's growth strategy has been the
acquisition of complementary businesses. The Company anticipates
that it may continue to make such acquisitions from time to time to the
extent they are compatible with the Company's long-term strategy. The
integration of newly acquired businesses into the Company presents
certain risks in addition to those presented by growth through internal
development, including additional demands on management time and
attention. In addition, certain of the Company's acquisitions have been
of businesses that had suffered losses prior to acquisitions by the
Company, including AKG in September 1993, Studer in March 1994
and Becker in February 1995.
DEPENDENCE ON SUPPLIERS
The Company is dependent upon certain unaffiliated domestic and
foreign suppliers for various components, parts, raw materials and
certain finished products. Some of the Company's suppliers produce
products that compete with the Company's products. Although the
Company believes that the loss of any one or more of its suppliers
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would not have a long-term material adverse effect on the Company
because other suppliers would be able to fulfill the Company's
requirements, the loss of certain of such suppliers could, in the short
term, adversely affect the Company's business until alternative suppliers
could be activated. The Company has begun using multiple vendors
and has thus limited its reliance on any single supplier. Arrangements
with foreign suppliers are also subject to the risks of doing business
abroad, such as import duties, trade restrictions, work stoppages, foreign
currency fluctuations, political instability and other factors which could
have an adverse effect on the Company.
COMPETITION
The high fidelity audio products business is fragmented and highly
competitive. Many manufacturers, large and small, domestic and
foreign, offer audio systems that vary widely in price and quality and
are marketed through a variety of channels, including audio specialty
stores, discount stores, department stores and mail order firms. Certain
competitors of the Company have financial and other resources greater
than those of the Company. There can be no assurance that the
Company will continue to compete effectively against existing or new
competitors that may enter its markets.
CURRENCY EXCHANGE RATES
The Company's operations are subject to fluctuations in foreign
currency exchange rates. Significant assets and operations of the
Company are located in Europe and Asia. In addition, the Company
purchases certain foreign-made products. The Company hedges a
portion of its foreign currency exposure and, due to the multiple
currencies involved in the Company's business, foreign currency
positions are partially offsetting and are netted against one another to
reduce exposure.
ANTI-TAKEOVER PROVISIONS
Certain provisions of the Company's Restated Certificate of
Incorporation, as amended (the "Certificate"), and its By-Laws, as
amended (the "By-Laws"), may make it more difficult for a third party
to make, or may discourage a third party from making, an acquisition
proposal for the Company or initiating a proxy contest and may thereby
inhibit a change in control of the Company or the removal of incumbent
management or directors.
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Fair Price Provisions
The Certificate contains provisions (the "Fair Price Provisions") that
raise the affirmative vote required to approve certain "Business
Combinations" (as defined below) involving an "Interested
Stockholder" (as defined below) to at least 66 2/3% of the votes of the
outstanding capital stock of the Company entitled to vote generally in
the election of directors (the "Voting Stock"), unless the transaction is
approved by a majority of disinterested directors or unless specified
price criteria described below and procedural requirements are satisfied.
A "Business Combination" is defined by the Certificate to include any
of the following transactions with, or proposed by, an Interested
Stockholder or affiliate: a merger or consolidation; a sale, lease or other
disposition of the Company's assets having an aggregate fair market
value of $10 million or more; a plan of dissolution proposed by an
Interested Stockholder; or a reclassification of securities or
recapitalization of the Company disproportionately favorable to an
Interested Stockholder. An "Interested Stockholder" is defined by the
Certificate to include any person or entity, other than the Company or
any subsidiary or employee benefit plan thereof, which owns
beneficially or controls directly or indirectly 20% or more of the shares
of the Voting Stock.
The 66 2/3% voting requirement is not applicable if certain procedural
requirements are met and if, in the case of a Business Combination
involving payments to holders of Common Stock, the fair market value
per share of such payments is equal to the greater of (i) the highest per
share price paid by the Interested Stockholder to purchase shares of
Common Stock in the two-year period prior to the first public
announcement of the proposed Business Combination (the
"Announcement Date") or in the transaction in which it became an
Interested Stockholder (whichever is greater), and (ii) the fair market
value per share of Common Stock on the Announcement Date or on the
date on which the Interested Stockholder became an Interested
Stockholder (whichever is greater). In addition, the consideration to be
paid to the Company's stockholders must be either cash or the same
consideration used by the Interested Stockholder in acquiring the largest
part of its Voting Stock prior to the Announcement Date.
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Supermajority Vote Requirements
The Certificate provides that a vote of the holders of 66 2/3% or more of
the voting power of the Voting Stock is required to amend, alter or
repeal, or to adopt any provision inconsistent with, the Fair Price
Provisions or the provisions relating to the classified board of directors
and ancillary matters. The Certificate also provides that the
stockholders may take action only at meetings and that directors may
only be removed for cause and by a 66 2/3% vote.
Anti-Takeover Statute
Section 203 of the Delaware General Corporation Law (the "DGCL") is
applicable to corporate takeovers in Delaware. Subject to certain
exceptions set forth herein, Section 203 of the DGCL provides that a
corporation may not engage in any business combination with any
"interested stockholder" for a three-year period following the time that
such stockholder becomes an interested stockholder unless: (i) prior to
such time, the board of directors of the corporation approved either the
business combination or the transaction which resulted in the
stockholder becoming an interested stockholder; (ii) upon
consummation of the transaction which resulted in the stockholder
becoming an interested stockholder, the interested stockholder owned at
least 85% of the voting stock of the corporation outstanding at the time
the transaction commenced (excluding certain shares); or (iii)
subsequent to such time, the business combination is approved by the
board of directors of the corporation and by the affirmative vote of at
least 66 2/3% of the outstanding voting stock which is not owned by the
interested stockholder. Except as specified therein, an interested
stockholder is defined to include any person that is the owner of 15% or
more of the outstanding voting stock of the corporation, or is an affiliate
or associate of the corporation and was the owner of 15% or more of the
outstanding voting stock of the corporation, at any time within three
years immediately prior to the relevant date, and the affiliates and
associates of such person. Under certain circumstances, Section 203 of
the DGCL makes it more difficult for an "interested stockholder" to
effect various business combinations with a corporation for a three-year
period.
MATERIAL CHANGES
There have been no material changes in the Company's affairs since
June 30, 1997, the end of the Company's last completed fiscal
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year, which have not been described in a report on Form 10-K or other
report filed under the Exchange Act and incorporated by reference
herein.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the
Shares offered hereby.
SELLING STOCKHOLDER
Set forth below is the name of the Selling Stockholder, the number of
shares of Common Stock owned by the Selling Stockholder prior to the
offering, the shares being offered hereby and, assuming all of the shares
being offered are sold, the number of shares of Common Stock owned
by the Selling Stockholder upon completion of the offering.
<TABLE>
<CAPTION>
Shares Owned Shares Owned
Selling Stockholder Prior to the Shares Offered After the
Offering Offering
- ------------------- ------------ -------------- ------------
<S> <C> <C> <C>
The Charleston Company 45,819 20,000 25,819
</TABLE>
The Shares being offered relate to shares of the Company's Common
Stock which may be issued and sold to the Selling Stockholder pursuant
to an option agreement between the Company and the Selling
Stockholder. This option was granted in 1994 as part of the
consideration for the Company's acquisition of all of the issued and
outstanding capital stock of NewMediaWare Systems, Inc., a California
corporation (whose name was later changed to Harman Interactive,
Inc.). The right, title and interest to such option was later assigned to
the Selling Stockholder listed above. The Selling Stockholder has no
relationship to the Company or its affiliates.
The Company has agreed to bear all expenses (other than
commissions and discounts of underwriters, broker-dealers or agents) in
connection with the registration and sale of the Shares being offered by
the Selling Stockholder. The Selling Stockholder has requested that the
Company use its best efforts to effectuate a registration of the Shares for
resale under the Securities Act. In light of this request, the Company has
filed with the Commission a Registration Statement with respect to the
resale of the Shares from time to time on the open market or in privately
negotiated transactions and has agreed to
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prepare and file such amendments and supplements to the Registration
Statement as may be necessary to keep the Registration Statement
effective until the earlier of February 1, 1998 or until all of the Shares
offered thereby have been sold. This Prospectus forms a part of the
Registration Statement.
MANNER OF DISTRIBUTION
The Shares covered hereby may be offered and sold from time to
time by the Selling Stockholder. The Selling Stockholder will act
independently of the Company in making decisions with respect to the
timing, manner and size of each sale. Such sales may be made on the
open market, at prices related to the then current market price or in
negotiated transactions, including one or more of the following
methods: (a) purchases by a broker-dealer as principal and resale by
such broker or dealer for its account pursuant to this Prospectus; (b)
ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and (c) block trades in which the broker-dealer so
engaged will attempt to sell the Shares as agent but may position and
resell a portion of the block as principal to facilitate the transaction.
The Company has been advised by the Selling Stockholder that it has
not made any arrangements relating to the distribution of the Shares
covered by this Prospectus. In effecting sales, broker-dealers engaged
by the Selling Stockholder may arrange for other broker-dealers to
participate. Broker-dealers may receive commissions or discounts from
the Selling Stockholder in amounts to be negotiated.
The Company has agreed to bear all expenses (other than
commissions and discounts of underwriters, broker-dealers or agents) in
connection with the registration and sale of the Shares being offered by
the Selling Stockholder.
This offering will terminate on the earlier of February 11, 1998 or
the date on which all Shares offered hereby have been sold by the
Selling Stockholder.
The Shares may not be sold in certain states unless they have been
registered or qualified for sale in such states or an exemption from
registration or qualification is available and is complied with.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby has been
passed upon for the Company by Jones, Day, Reavis & Pogue,
Washington, D.C.
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EXPERTS
The consolidated financial statements and schedules of Harman
International Industries, Incorporated and subsidiaries as of June 30,
1997 and 1996 and for each of the years in the three-year period ended
June 30, 1997, incorporated herein by reference, have been incorporated
in this Prospectus in reliance upon the report of KPMG Peat Marwick
LLP, independent certified public accountants, incorporated by
reference, and upon the authority of said firm as experts in accounting
and auditing.
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