As filed with the Securities and Exchange Commission on September 11, 1997
Registration No. 333-35253
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------
Amendment No. 1 to
Form S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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SEQUENT COMPUTER SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
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Oregon 93-0826369
(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification Number)
15450 S.W. Koll Parkway
Beaverton, Oregon 97006-6063
Telephone: (503) 626-5700
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
-------------------
ROBERT S. GREGG
Sr. Vice President-Finance and Legal and Chief Financial Officer
Sequent Computer Systems, Inc.
15450 S.W. Koll Parkway
Beaverton, Oregon 97006-6063
Telephone: (503) 626-5700
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
-------------------
Copies to:
MARGARET HILL NOTO
Stoel Rives LLP
900 SW Fifth Avenue, Suite 2300
Portland, Oregon 97204
(503) 224-3380
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
-------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
-------------------
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] ____________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. [ ] ___________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
-------------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, as amended, or until the Registration Statement
shall become effective on such a date as the Commission, acting pursuant to said
Section 8(a), may determine.
<PAGE>
PROSPECTUS
300,000 Shares
[LOGO]
COMMON STOCK
300,000 Shares are being registered by the Company for issuance pursuant to
a Warrant To Purchase Shares Of Common Stock Of Sequent Computer Systems,
Inc. dated August 7, 1996. See "Distribution." The Company's Common
Stock is listed on the Nasdaq National Market under the symbol
"SQNT." On September 8, 1997, the last sale price of the
Common Stock as reported on the Nasdaq National Market was
$28.875 per Share. See "Price Range of Common Stock."
---------------
THIS ISSUANCE INVOLVES A HIGH DEGREE OF RISK.
SEE "RISK FACTORS" COMMENCING ON PAGE 5 HEREOF.
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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.
---------------
PRICE $21.50 A SHARE
---------------
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------
Underwriting
Price to Discounts and Proceeds to
Warrant Holder Commissions Company (1)
- ------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share.................. $21.50 $0 $21.50
- ------------------------------------------------------------------------------------
Total...................... $6,450,000 $0 $6,450,000
- ------------------------------------------------------------------------------------
(1) Before deducting expenses payable by the Company estimated at $8,000.
</TABLE>
---------------
<PAGE>
No person is authorized in connection with any offering made hereby to give
any information or to make any representation not contained in this Prospectus,
and, if given or made, such information or representation must not be relied
upon as having been authorized by the Company. This Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy any security
other than the shares of Common Stock offered hereby, nor does it constitute an
offer to sell or a solicitation of an offer to buy any of the securities offered
hereby to any person in any jurisdiction in which it is unlawful to make any
such offer or solicitation to such person. Neither the delivery of this
Prospectus nor any sale made hereby shall under any circumstances imply that the
information contained herein is correct as of any date subsequent to the date
hereof.
TABLE OF CONTENTS
Page
Incorporation of Certain Documents by Reference................................2
The Company....................................................................4
Risk Factors...................................................................5
Use of Proceeds...............................................................10
Determination of Offering Price...............................................10
Distribution..................................................................10
Legal Matters.................................................................10
Experts.......................................................................11
Available Information.........................................................11
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Securities and
Exchange Commission (the "Commission") (File No. 0-15627) pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), are
incorporated in this Prospectus by reference: (i) the Company's Annual Report on
Form 10-K for the fiscal year ended December 28, 1996; (ii) the Company's
Quarterly Report on Form 10-Q for the quarter ended March 29, 1997; (iii) the
Company's Quarterly Report on Form 10-Q for the quarter ended June 28, 1997; and
(iv) the description of the Company's Common Stock contained in the Company's
Registration Statement on Form 8-A filed under Section 12 of the Exchange Act,
including any amendment or report updating such description.
Each document filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering made hereby shall be deemed to be incorporated by
reference into this Prospectus and to be a part hereof from the date of filing
of such document (all such documents, and the documents enumerated above, being
hereinafter referred to as "Incorporated Documents").
Any statement contained in an Incorporated Document 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 Incorporated
Document modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
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<PAGE>
The Company will provide without charge to each person to whom a copy of
this Prospectus is delivered, including any beneficial owner, upon the written
or oral request of such person, a copy of any or all of the Incorporated
Documents, other than exhibits to such documents unless such exhibits are
specifically incorporated by reference therein. Requests for such copies should
be directed to Sequent Computer Systems, Inc., 15450 S.W. Koll Parkway,
Beaverton, Oregon 97006, Attention: Robert S. Gregg, Sr. Vice President-Finance
and Legal and Chief Financial Officer (telephone: (503) 626-5700). The
information relating to the Company contained in this Prospectus does not
purport to be comprehensive and should be read together with the information
contained in the Incorporated Documents.
---------------
Sequent(R) and Symmetry(R) are registered trademarks and NUMA-Q and IQ-Link
are trademarks of Sequent Computer Systems, Inc.
3
<PAGE>
THE COMPANY
Sequent Computer Systems, Inc. ("Sequent" or the "Company") is a leading
provider of high-end scalable data-center-ready open systems solutions for large
organizations spanning diverse industries. The Company pioneered the development
of large-scale, Intel-based symmetric multi-processing ("SMP") systems in the
1980s and has installed over 8,000 SMP systems worldwide. In 1996, Sequent was
first to market with large-scale cache coherent nonuniform memory access
("CC-NUMA") systems based on Intel's Pentium Pro architecture and designed to
run the UNIX operating system. The Company's products are used primarily as
database servers for large on-line transaction processing ("OLTP") and decision
support systems ("DSS")/data warehousing applications built with relational
database management system ("RDBMS") software.
The Company was incorporated in Delaware in January 1983 and was
reincorporated in Oregon in December 1988. Unless the context otherwise
requires, references in this Prospectus to the "Company" or "Sequent" refer to
the prior Delaware corporation and the current Oregon corporation and its
subsidiaries. The Company's principal executive offices are located at 15450
S.W. Koll Parkway, Beaverton, Oregon 97006, and its telephone number at that
location is (503) 626-5700.
4
<PAGE>
RISK FACTORS
In addition to the other information in this Prospectus and in the
documents incorporated by reference herein, the following Risk Factors should be
carefully considered in evaluating the Company and its business before
purchasing the Common Stock offered by this Prospectus. This section contains
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended (the "Securities Act"), and Section 21E of the Exchange
Act. Actual results could differ materially from those projected in the
forward-looking statements as a result of the Risk Factors set forth below.
Fluctuations in Quarterly Results. The Company's results of operations have
fluctuated significantly from period to period, including on a quarterly basis.
The Company has historically experienced strong fourth-quarter orders and
revenue and relatively weak first-quarter orders and revenue from customers. A
significant portion of the Company's products are shipped in the quarter in
which the orders are received. The Company's backlog has historically been
relatively small and is not necessarily indicative of future sales levels. As is
the case with many high technology companies, a disproportionately large
percentage of a quarter's total sales occur in the last month and weeks and days
of such quarter. The Company's quarterly sales and operating results, therefore,
depend in large part on the volume and timing of orders received during the
quarter, which are difficult to forecast. Accordingly, the Company may be unable
to adjust spending in a timely manner to compensate for any unexpected revenue
shortfall. As a result, any significant shortfall of demand for the Company's
products and services in relation to the Company's expectations could have an
immediate material adverse effect on the Company's business, operating results
and financial condition. Further, as the Company's sales to major accounts
continue to increase, the Company expects that a limited number of large sales
may account for a more significant portion of revenue in some quarters, creating
greater exposure to possible fluctuations in revenue. In addition, larger orders
typically involve substantially longer selling cycles, which makes quarterly
forecasts of sales more difficult.
The Company may experience significant fluctuations in future quarterly
operating results that may be caused by many factors, including demand for the
Company's products, introduction or enhancement of products by the Company or
its competitors, market acceptance of new products including its NUMA-Q
products, the timing of sales to large accounts, pricing, pressures, the mix of
products sold and the mix between product and service revenue, lengthy sales
cycles, capital spending levels by customers, shipment interruptions due to
quality problems and general economic conditions. Because of all of the
foregoing factors, it is possible that in some future quarters the Company's
operating results will be below the expectations of securities analysts or
investors. In such event, the market price of the Company's Common Stock could
be materially adversely affected.
Recent Introduction of NUMA-Q; Product Concentration. During 1996, the
Company made significant investments in the continuing development of its NUMA-Q
products and the expansion of its sales organization to market this new product
line. Shipments of NUMA-Q products began in late 1996, and from late 1996
through the second quarter of 1997 the
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<PAGE>
Company sold approximately 240 NUMA-Q systems. By the second quarter of 1997, a
majority of the Company's sales were from NUMA-Q products, and the Company
expects to become increasingly dependent on revenue from sales of these
products. Accordingly, broad customer acceptance of NUMA-Q products is critical
to the Company's success. NUMA-Q is a new architecture that has not yet been
widely implemented and has not yet gained widespread customer acceptance.
Because the Company has only recently begun shipping NUMA-Q products, there can
be no assurance that, despite testing by the Company and by current and
potential customers, errors will not be found in NUMA-Q products, or, if
discovered, such errors will be successfully corrected in a timely and
cost-effective manner. The Company's business, operating results and financial
condition could be materially adversely affected if NUMA-Q products fail to gain
customer acceptance, sales of these products are lower than anticipated by the
Company, competitive products are introduced or significant hardware or software
errors are found in these systems.
Competition. The computer business is intensely competitive. The Company
competes with a number of companies that have considerably greater financial,
marketing, technical and operating resources. The Company competes with, among
others, Hewlett-Packard Company, Digital Equipment Corporation, International
Business Machines Corporation and Sun Microsystems, Inc., which have large
installed customer bases in many of the markets addressed by the Company. All of
these companies offer products that compete with Sequent's products. Silicon
Graphics, Inc. and Data General Corporation have already introduced products
based on CC-NUMA technology and other companies are believed to be developing
products based on CC-NUMA technology. Most also have large professional services
organizations and alliances with many of the same hardware and software vendors
with which Sequent has strategic relationships. No assurances can be given that
the Company will have the financial resources, marketing, distribution and
service organizations, technical capabilities or depth of key personnel
necessary to compete successfully in the future.
Product Development. The computer industry is subject to rapid and
significant technological change and frequent introductions of new competitive
products. To remain competitive, the Company will be required to continue to
invest substantially in research and development, enhance its existing products
(including its NUMA-Q products), introduce new competitive products and maintain
price/performance advantages in its selected markets. There can be no assurance
that it will be able to respond adequately to unexpected technological changes
in its markets or that future products will be successful.
Strategic Relationships. The Company has developed strategic relationships
with leading hardware and software providers and is engaged in joint research
and product development and marketing arrangements with these companies. The
Company's ability to enhance its existing NUMA-Q products and develop new
products is significantly dependent on maintaining and strengthening the
Company's relationships with leading providers, particularly Intel Corporation,
Microsoft Corporation and Oracle Corporation. Many of these hardware and
software vendors also have significant development and marketing relationships
with the Company's competitors. The Company plans to continue its strategy of
developing technology and marketing relationships with these and other leading
hardware and software vendors. There can be no assurance that
6
<PAGE>
the Company will be successful in its ongoing strategic relationships or that
the Company will be able to find additional suitable business relationships as
it develops new products. Any failure to continue or expand such relationships
could have a material adverse effect on the Company's business, operating
results and financial condition. There can be no assurance that the Company's
strategic partners, most of which have significantly greater financial and
marketing resources than the Company, will not develop and market products in
competition with the Company in the future, discontinue their relationships with
the Company or form or strengthen arrangements with the Company's competitors.
Supply of Components. Certain components used by the Company, including
Intel microprocessors, custom VLSI gate arrays and intelligent high-speed data
switches (IQ-Link), are only available from single sources. The Company attempts
to reduce the risk of supply interruption through greater inventory positions in
sole-source components. Other components, such as memory chips, have
occasionally been in short supply throughout the industry. Failure to obtain
sole-source or other parts and components in adequate quantities on a timely
basis could increase costs or delay shipments and have an adverse effect on the
Company's revenues and net income. The adverse effect of a supplier's failure to
meet Sequent's requirements may be intensified by the fact that a large portion
of orders are received, and the products shipped, at the end of a quarter.
Capitalization of Software Development Costs. The Company has made and
continues to make significant investments in software development. The amount of
expenditures that qualify for capitalization under Statement of Financial
Accounting Standards No. 86 "Accounting for the Costs of Computer Software to Be
Sold, Leased, or Otherwise Marketed" may vary from period to period as software
projects progress through the development life-cycle. These variations could
impact the Company's operating results in any given period. Unamortized software
development costs were approximately $63.2 million at June 28, 1997. If
technological developments or other factors were to jeopardize the realizability
of such assets, the Company could be required to write off all or a substantial
portion of such capitalized values, which could have a material adverse effect
on the Company's results of operations for the period in which the write-off
occurs.
Inventory Obsolescence; Prepaid Licenses. The Company expects sales of
Symmetry products to continue to decline as NUMA-Q products gain market
acceptance. Symmetry inventory net of reserves was $32.6 million at June 28,
1997. Based upon current sales forecasts, the Company expects that substantially
all of the Symmetry inventory will be sold and that no significant write-offs in
excess of reserves will be required. However, if Symmetry sales decline more
rapidly than expected, write-offs of the Symmetry inventory could be required,
which could have a material adverse effect on the Company's results of
operations. The Company has entered into agreements with various software
vendors under which the Company has prepaid licenses and royalties for software
to be sold by the Company. Prepaid licenses and royalties were approximately $27
million at June 28, 1997. Such prepaid amounts are generally realized by
charging cost of products sold for software sales by the Company. The Company's
ability to realize these prepaid amounts is contingent on customer demand for
the software and sales of the software to Sequent's customers. Management
presently believes that software sales
7
<PAGE>
will be sufficient to recover the prepaid amount. However, no assurance can be
made that such prepaid amounts will be realized. See "Risk Factors -- Recent
Introduction of NUMA-Q; Product Concentration."
Uncertain Protection of Intellectual Property. The Company's success and
ability to compete is dependent in part upon its internally developed
technology. While the Company relies on patent, trademark, trade secret and
copyright law to protect its technology, the Company believes that factors such
as the technological and creative skills of its personnel, new product
developments, frequent product enhancements, name recognition and reliable
product maintenance are more essential to establishing and maintaining a
technology leadership position. There can be no assurance that others will not
develop technologies that are similar or superior to the Company's technology.
The Company generally enters into confidentiality or license agreements with its
employees, consultants and vendors and generally seeks to control access to and
distribution of its proprietary information. Despite these precautions, it may
be possible for a third party to copy or otherwise obtain and use the Company's
products or technology without authorization, or to develop similar technology
independently. There can be no assurance that the steps taken by the Company
will prevent misappropriation of its technology or that such confidentiality and
license agreements will be enforceable.
Periodically, the Company has received, and may receive in the future,
notices of claims of infringement of other parties' proprietary rights. Although
the Company does not believe that its products infringe the proprietary rights
of any third parties, there can be no assurance that infringement or invalidity
claims (or claims for indemnification resulting from infringement claims) will
not be asserted or prosecuted against the Company or that any such assertions or
prosecutions (including the costs of litigation) will not materially adversely
affect the Company's business, operating results and financial condition. If any
claims or actions are asserted against the Company, the Company may seek to
license a third party's intellectual property rights. There can be no assurance,
however, that under such circumstances, a license would be available on
reasonable terms or at all.
Availability of Key Personnel; Expansion of Sales Force. The Company's
continued growth depends upon its ability to attract, integrate and retain
qualified management, technical and sales and support personnel for its
operations. During 1996 and the first quarter of 1997, the Company significantly
expanded its sales force, from 174 sales personnel as of December 31, 1995 to
247 sales personnel as of June 28, 1997. Competition for such personnel is
intense, and the Company may find it difficult to attract such personnel in a
timely and efficient manner or to retain and integrate such personnel. This
competition could adversely affect the Company's ability to expand and manage
its sales force to sell its NUMA-Q products and professional services to large
accounts and to develop marketing relationships with large systems integrators.
Manufacturing Risks. The Company's products are designed and manufactured
for high reliability. If flaws in design, production, assembly or testing occur
on the part of Sequent or its suppliers, Sequent may experience a rate of
failure in its products that results in substantial repair or replacement costs
and potential damage to its reputation. There can be no assurance
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that Sequent's efforts to monitor, develop and implement appropriate test and
manufacturing processes for its products will be sufficient to permit Sequent to
avoid a rate of failure in its products that results in substantial delays in
shipment, significant repair or replacement costs and potential damage to
Sequent's reputation, any of which could have a material adverse effect on
Sequent's business, operating results and financial condition.
International Operations. The Company derived 55% of its total revenues
from foreign customers in the year ended December 28, 1996, a substantial
portion of which was denominated in currencies other than U.S. dollars. Most of
the Company's international sales are in Europe. International operations are
subject to various risks, including exposure to currency fluctuations, the
greater difficulty of administering business abroad and the need to comply with
a wide variety of international and United States export laws and regulatory
requirements.
Volatility of Stock Prices. There has been a history of significant
volatility in the market prices of the common stock of electronics companies,
including that of the Company, and it is likely that the market price of the
Company's Common Stock will continue to be subject to significant fluctuations.
Factors such as the timing and market acceptance of new product introductions by
the Company, the introduction of new products by the Company's competitors,
variations in quarterly operating results, changes in securities analysts'
recommendations regarding the Company's Common Stock, developments in the
electronics industry and general economic conditions may have a significant
impact on the market price of the Company's Common Stock. In addition, the
equity markets in recent years have experienced significant price and volume
fluctuations that have affected the market prices of technology companies and
that have often been unrelated to the operating performance of such companies.
9
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USE OF PROCEEDS
The net proceeds to the Company from the sale of the 300,000 shares of
Common Stock offered by the Company hereby (at an offering price of $21.50 per
share and after deducting estimated offering expenses payable by the Company)
are estimated to be approximately $6.4 million. The Company intends to use the
net proceeds for general corporate purposes, including working capital, product
development and capital expenditures. A portion of the net proceeds may also be
used to acquire or invest in complementary businesses or products or to obtain
the right to use complementary technologies. The Company has no current plans,
agreements or commitments with respect to any such acquisition or investment,
and the Company is not currently engaged in any negotiations with respect to any
such transaction. Pending such uses, the net proceeds will be invested in
investment grade, short-term, interest-bearing securities and the Company may
use a portion of the net proceeds from the offering to collateralize facilities
financing transactions.
DETERMINATION OF OFFERING PRICE
The offering price of $21.50 per share of the Company's Common Stock was
determined in accordance with a Warrant to Purchase Shares of Common Stock of
Sequent Computer Systems, Inc. (the "Warrant"). See "Distribution."
DISTRIBUTION
The 300,000 shares (the "Shares") of the Company's Common Stock are being
registered for issuance pursuant to the Warrant. Pursuant to the Warrant, on or
about August 4, 1997, MCSB Technology, the holder of the Warrant (the "Holder"),
requested that the Company file this Registration Statement with respect to the
issuance of the Shares. The Company is required to file this Registration
Statement within 45 days of its receipt of the Holder's request and to use its
best efforts to cause the Shares to be registered.
The Warrant, pursuant to its terms, may be exercised by the Holder in whole
at any time, or in part from time to time, by (i) surrendering to the Company
payment in full by wire transfer or certified check of $21.50 times the number
of shares of the Company's Common Stock with respect to which the Warrant is
being exercised and (ii) executing and delivering to the Secretary of the
Company a valid Exercise Form. The Company shall deliver certificates for the
Shares to the Holder as soon as practicable after such exercise.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be passed
upon for the Company by Stoel Rives LLP, Portland, Oregon.
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EXPERTS
The consolidated financial statements as of December 30, 1995 and December
28, 1996 and for each of the three years in the period ended December 28, 1996
incorporated in this Prospectus by reference to the Company's Annual Report on
Form 10-K for the fiscal year ended December 28, 1996, have been so incorporated
in reliance on the report of Price Waterhouse LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.
AVAILABLE INFORMATION
Sequent is subject to the informational requirements of the Exchange Act
and in accordance therewith files reports, proxy statements and other
information with the Commission. Such reports, proxy statements and other
information may be inspected and copied at the public reference facilities
maintained by the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Room
1024, Washington, D.C. 20549, and at the public reference facilities in the
Regional Offices of the Commission located at 7 World Trade Center, 13th Floor,
New York, New York 10048 and Citicorp Centers, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Copies of these materials can be obtained at
prescribed rates from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549. Certain of such reports, proxy
statements and other information are also available from the Commission on the
Internet at http://www.sec.gov. The Company's Common Stock is quoted for trading
in the Nasdaq National Market and reports, proxy statements and other
information concerning the Company may be inspected at the offices of the
National Association of Securities Dealers, Inc., 9513 Key West Avenue,
Rockville, Maryland 20850.
The Company has filed with the Commission a Registration Statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act. This Prospectus does not contain all of
the information set forth in the Registration Statement, certain parts of which
are omitted in accordance with the rules and regulations of the Commission. For
further information with respect to the Company and the securities offered
hereby, reference is hereby made to the Registration Statement, copies of which
are available from the Public Reference Section of the Commission at prescribed
rates, as discussed above. Statements contained in this Prospectus as to the
contents of any contract or other document referred to herein are not
necessarily complete, and in each instance in which a copy of such contract or
document is filed as an exhibit to the Registration Statement or another
document filed by the Company with the Commission, reference is made to such
copy and each such statement shall be deemed qualified in all respects by such
reference. The Registration Statement may be inspected without charge at the
Commission's principal office in Washington, D.C., and copies of all or any part
thereof may be obtained from the Public Reference Section, Securities and
Exchange Commission, Washington, D.C. 20549, upon payment of the prescribed
fees.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by the Company in connection
with the sale of Common Stock being registered. All amounts are estimated except
the SEC registration fee.
SEC Registration Fee.....................................$2,653.14
Legal Fees and Expenses..................................$3,000.00
Accounting Fees and Expenses.............................$2,500.00
---------
TOTAL................................................$8,153.14
=========
Item 15. Indemnification of Directors and Officers.
Article X of the Company's Articles of Incorporation provides for
indemnification of directors to the fullest extent not prohibited by the Oregon
Business Corporation Act (the "Act"). The Bylaws also contain indemnification
provisions. The effects of the Articles, Bylaws and the Act (the
"Indemnification Provisions") are summarized as follows:
(a) The Indemnification Provisions grant a right of indemnification in
respect of any action, suit or proceeding (other than an action by or in
the right of the Company) against expenses (including attorneys' fees),
judgments, fines, and amounts paid in settlement actually and reasonably
incurred, if the person concerned acted in good faith and in a manner the
person reasonably believed to be in or not opposed to the best interests of
the Company, was not adjudged liable on the basis of receipt of an improper
personal benefit and, with respect to any criminal action or proceeding,
had no reasonable cause to believe the conduct was unlawful. The
termination of an action, suit, or proceeding by judgment, order,
settlement, conviction, or plea of nolo contendere does not, of itself,
create a presumption that the person did not meet the required standards of
conduct.
(b) The Indemnification Provisions grant a right of indemnification in
respect of any action or suit by or in the right of the Company against the
expenses (including attorneys' fees) actually and reasonably incurred if
the person concerned acted in good faith and in a manner the person
reasonably believed to be in or not opposed to the best interests of the
Company, except that no right of indemnification will be granted if the
person is adjudged to be liable to the Company.
II-1
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(c) Every person who has been wholly successful on the merits of a
controversy described in (a) or (b) above is entitled to indemnification as
a matter of right.
(d) Because the limits of permissible indemnification under Oregon law
are not clearly defined, the Indemnification Provisions may provide
indemnification broader than that described in (a) and (b).
Section 10.6 of the Company's Bylaws provides that the Company will advance
to a director the expenses incurred in defending any action, suit or proceeding
in advance of its final disposition if the director or officer affirms in good
faith that he or she has met the standard of conduct to be entitled to
indemnification as described in (a) or (b) above and undertakes to repay any
amount advanced if it is determined that the person did not meet the required
standard of conduct.
The Company's Articles and Bylaws provide that the Company may, in the
discretion of the Board of Directors, indemnify and advance expenses to officers
and employees to the same extent that directors are entitled to indemnification
and advancement of expenses.
The rights of indemnification described above are not exclusive of any
other rights of indemnification to which the person indemnified may be entitled
under any bylaw, agreement, vote of shareholders or directors, or otherwise.
Item 16. Exhibits.
Exhibit
Number Description
- ------- -----------
3.1 Articles of Incorporation, as amended, of the Company. (Incorporated by
reference to Exhibit 4A to the Company's Registration Statement on Form
S-8 (File No. 33-63972).)
3.2 Bylaws, as amended, of the Company. (Incorporated by reference to Exhibit
4B to the Company's Registration Statement on Form S-3 (File No.
333-31189).)
4 Warrant to Purchase Shares of Common Stock of Sequent Computer Systems,
Inc.
5 Opinion of Counsel
12 Statement Regarding Computation of Ratios. (Incorporated by reference to
Exhibit 11 to the Quarterly Report on Form 10-Q for the Quarter ended
June 28, 1997 (File No. 0- 15627).)
*23.1 Consent of Price Waterhouse LLP.
23.2 Consent of Stoel Rives LLP (see Exhibit 5).
24 Powers of Attorney.
- ------------------
* Filed herewith.
II-2
<PAGE>
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any 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, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
(d) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the
II-3
<PAGE>
registrant pursuant to Rule 424(b) (1) or (4) or 497(h) under the
Securities Act and shall be deemed to be part of the registration statement
as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Amendment
No. 1 to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Beaverton, State of
Oregon, on the 11th day of September, 1997.
SEQUENT COMPUTER SYSTEMS, INC.
By: ROBERT S. GREGG
-------------------------------------
(Robert S. Gregg, Sr. Vice President-
Finance and Legal and Chief
Financial Officer)
Pursuant to the requirements of the Securities Act, this Amendment No. 1 to
the Registration Statement has been signed below on September 11, 1997, by the
following persons in the capacities indicated.
Signature Title
--------- -----
KARL C. POWELL, JR. * Chairman of the Board, President, Chief
- ---------------------------------- Executive Officer and Director
(Karl C. Powell, Jr.) (Principal Executive Officer)
ROBERT S. GREGG Sr. Vice President-Finance and Legal and
- ---------------------------------- Chief Financial Officer
(Robert S. Gregg) (Principal Accounting and Financial
Officer)
STEVE CHEN * Director
- ----------------------------------
(Steve Chen)
JOHN MCADAM * Director
- ----------------------------------
(John McAdam)
ROBERT C. MATHIS * Director
- ----------------------------------
(Robert C. Mathis)
MICHAEL S. SCOTT MORTON * Director
- ----------------------------------
(Michael S. Scott Morton)
RICHARD C. PALERMO * Director
- ----------------------------------
(Richard C. Palermo)
II-5
<PAGE>
ROBERT W. WILMOT * Director
- ----------------------------------
(Robert W. Wilmot)
*By ROBERT S. GREGG
---------------------------------
Robert S. Gregg, Attorney-in-fact
II-6
<PAGE>
INDEX TO EXHIBITS
Exhibit
No. Description of Exhibit
- ------- ----------------------
4 Warrant To Purchase Shares Of Common Stock Of Sequent Computer
Systems, Inc.
5 Opinion of Stoel Rives LLP
*23.1 Consent of Price Waterhouse LLP
24 Powers of Attorney
- ---------
* Filed herewith.
II-7
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
January 23, 1997, which appears on page 50 of the 1996 Annual Report to
Shareholders of Sequent Computer Systems, Inc., which is incorporated by
reference in the Sequent Computer Systems, Inc. Annual Report on Form 10-K for
the year ended December 28, 1996. We also consent to the incorporation by
reference of our report on the Financial Statement Schedules, which appears on
page F-6 of such Annual Report on Form 10-K. We also consent to the reference to
us under the heading "Experts" in such Prospectus.
PRICE WATERHOUSE LLP
Portland, Oregon
September 8, 1997
