WIND RIVER SYSTEMS INC
424B3, 1999-08-27
COMPUTER PROGRAMMING SERVICES
Previous: HOMEFED CORP, S-2/A, 1999-08-27
Next: PRUDENTIAL STRUCTURED MATURITY FUND INC, 497, 1999-08-27



<PAGE>
                                                                Rule 424(b)(3)

                                   PROSPECTUS





                                 730,923 SHARES

                            WIND RIVER SYSTEMS, INC.

                                  COMMON STOCK


     The following selling stockholders are offering up to 730,923 shares of
Wind River Systems, Inc. common stock:

     -     Ross Wheeler
     -     Advanced Logic Solutions, Inc.


     Our common stock trades on the Nasdaq National Market under the symbol
WIND. On August 24, 1999, the last reported sale price of our common stock was
$15.25 per share.

INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" COMMENCING ON PAGE 3.

THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE
NOT APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS
IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.

August 24, 1999




<PAGE>

                 INFORMATION ABOUT WIND RIVER AND THIS OFFERING

     Wind River Systems, Inc. develops, markets and supports advanced
software operating systems and development tools that allow customers to create
complex, robust, real-time software applications for embedded computers. An
embedded computer is a microprocessor that is incorporated into a larger device
and is dedicated to responding to external events by performing specific tasks
quickly, predictably and reliably. Some examples of embedded computers are:

     -    telecommunications products such as PABX, routers, central office
          switches and call processing systems;

     -    office products such as fax machines, laser printers and photocopiers;

     -    vehicle anti-lock brakes and navigation systems;

     -    consumer products such as camcorders, video games and set-top boxes;

     -    medical instrumentation and imaging systems;

     -    industrial automation equipment such as robots; and

     -    aerospace devices such as NASA's Mars probe, Pathfinder.

Our flagship products, Tornado-TM- and VxWorks-Registered Trademark-, enable
customers to enhance product performance, standardize designs across
projects, reduce research and development costs and shorten product
development cycles.

     We are a Delaware corporation. Our principal offices are located at 500
Wind River Way, Alameda, California 94501, and our telephone number is (510)
748-4100. In this prospectus, "Wind River," "we" and "our" refer to Wind
River Systems, Inc. unless the context otherwise requires.

     The selling stockholders acquired their shares of Wind River common
stock on June 30, 1999 in connection with our acquisition of RouterWare, Inc.

No dealer, salesperson or other person is authorized to give any information
or to represent anything not contained in this prospectus. You must not rely
on any unauthorized information or representations. This prospectus may only
be used where it is legal to sell these securities. The information contained
in this prospectus is current only as of its date.


                                       2
<PAGE>

                                  RISK FACTORS

     YOU SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED BELOW BEFORE MAKING AN
INVESTMENT DECISION. THE RISKS AND UNCERTAINTIES DESCRIBED BELOW ARE NOT THE
ONLY ONES FACING OUR COMPANY. ADDITIONAL RISKS AND UNCERTAINTIES NOT
PRESENTLY KNOWN TO US OR THAT WE CURRENTLY DEEM IMMATERIAL ALSO MAY IMPAIR
OUR BUSINESS OPERATIONS. IF ANY OF THE FOLLOWING RISKS ACTUALLY OCCUR, OUR
BUSINESS COULD BE HARMED SIGNIFICANTLY. IN SUCH CASE, THE TRADING PRICE OF
OUR COMMON STOCK COULD DECLINE, AND YOU MAY LOSE ALL OR PART OF YOUR
INVESTMENT.

NUMEROUS FACTORS MAY CAUSE OUR REVENUES AND OPERATING RESULTS TO FLUCTUATE
SIGNIFICANTLY FROM PERIOD TO PERIOD

     Our revenues and operating results have fluctuated significantly in the
past and may continue to do so in the future. If our quarterly or annual
operating results do not meet the expectations of securities analysts and
investors, the market price of our common stock could decline significantly.
A number of factors, many of which are outside our control, may cause or
contribute to these fluctuations, including:

     -    the amount and timing of orders we receive

     -    changes in the length of our products' sales cycles, which increase as
          our customers' purchase decisions become more strategic and are made
          at higher management levels

     -    the success of our customers' products from which we derive our
          royalty revenues

     -    the mix of our revenues from the sale of services as compared to
          products, which have higher margins

     -    our ability to control our operating expenses, which we anticipate
          will continue to increase during the current fiscal year

     -    our ability to continue to develop, introduce and ship competitive new
          products and product enhancements quickly

     -    announcements, new product introductions and price reductions by our
          competitors

     -    our ability to manage costs for fixed-price consulting engagements

     -    changes in business cycles that affect the markets in which we sell
          our products;

     -    economic conditions generally and in international markets, which
          historically have provided a significant portion of our revenues

     -    foreign currency exchange rates

     In addition, we often recognize a significant portion of our quarterly
revenues from orders we receive and ship in the last month of the quarter
and, as a result, we may not be able to forecast our revenues until late in
the period. Further, our customers historically have purchased more of our
products in our fourth fiscal quarter than in other quarters A decrease in
orders is likely to adversely and disproportionately affect our operating
results, because a significant portion of our expenses are fixed and are
based, in part, on our expectations of future revenues. Therefore, we have a
limited ability to reduce expenses in response to a shortfall in anticipated
revenues. We believe that period-to-period comparisons of our operating
results may not be meaningful, and you should not rely on them as an
indication of our future performance.

                                       3
<PAGE>

     We only recently began to focus on offering software consulting services
and therefore may not be as experienced in this business as others. To be
successful with our professional services business, we must overcome several
factors including:

     -    Services contracts can be fixed-price commitments and if our cost of
          performing the services consistently and significantly exceeds the
          amount the customer has agreed to pay, it could materially adversely
          affect our business, financial condition and results of operations.

     -    Our cost of services personnel and certified consultants is high which
          results in lower gross margins than our software business.

If we cannot accurately estimate our costs and achieve milestones during
consulting engagements and retain competent services personnel, our business,
financial condition and results of operations could be materially adversely
affected.

OUR OPERATING RESULTS ARE DEPENDENT UPON SALES OF A SMALL NUMBER OF PRODUCTS

     Revenue from sales of our Tornado and VxWorks family of products and
services have historically accounted for substantially all of our revenue,
and we expect this concentration will continue in the foreseeable future. Any
reduction in the demand for Tornado or VxWorks family of products and
services could materially adversely affect our operating results and cause
the price of our common stock to decline.

A SIGNIFICANT PORTION OF OUR REVENUE IS DEPENDENT UPON THE MARKET ACCEPTANCE
OF OUR CUSTOMERS' PRODUCTS

     One of the key components of our business strategy is to increase
revenue through royalty fees for each copy of our operating system embedded
in the products our customers sell. Success of this strategy depends upon our
ability to successfully negotiate royalty agreements with our customers and
their successful commercialization of the underlying products. To the extent
that our customers are not successful, for whatever reason, our revenues may
be reduced significantly and our business, financial condition and results of
operations could be materially adversely affected.

OUR FAILURE TO RESPOND QUICKLY TO RAPID TECHNOLOGICAL CHANGE WITH PRODUCT
OFFERINGS WILL ADVERSELY AFFECT OUR ABILITY TO COMPETE

     The market for embedded real-time software is characterized by ongoing
technological developments, evolving industry standards, and rapid changes in
customer requirements. Our success depends upon our ability to adapt and
respond to these changes. We must continuously update our existing products
to keep them current with customer needs, and must develop new products to
take advantage of new technologies, emerging standards, and expanding
customer requirements that could render our existing products obsolete.
Additionally, we have from time to time experienced delays in the development
of new products and the enhancement of existing products, including, most
recently, a delay in the development of our new product "Tornado for Managed
Switches." Such delays are commonplace in the software industry. Furthermore,
if we cannot achieve design wins with key customers, our business will be
significantly affected. Once a customer has designed the product with a
particular operating system, that customer typically is reluctant to change
its supplier due to the significant costs associated with selecting a new
supplier. If we cannot, for technical, legal, financial or other reasons,
adapt or respond in a cost effective and timely manner to

                                       4
<PAGE>

changing market conditions or customer requirements, our business and
operating results would suffer.

IF OUR NEW PRODUCT LINES ARE NOT ACCEPTED, OUR BUSINESS WOULD BE MATERIALLY
ADVERSELY AFFECTED.

     Our future success is substantially dependent upon whether our new
product lines gain wide market acceptance. We are continuously engaged in
product development for new or changing markets. In particular, we have
invested significant time and effort, together with a consortium of industry
participants, in the development of I2O, a new specification that is intended
to create an open standard set of interface specifications for high
performance Input Output (I/O) systems. In parallel with this effort, we have
developed IxWorks, a real-time operating system for use in conjunction with
the I2O specification. The success of the I2O specification and the IxWorks
product line depends heavily on its adoption by a broad segment of the
industry.

     We have also spent, and continue to spend, substantial time and
financial resources to develop software for Internet appliances and Internet
infrastructure including "Tornado for Managed Switches." The commercial
Internet market has only recently begun to develop, is rapidly changing and
is characterized by an increasing number of new entrants with competitive
products. Moreover, there is an increasing number of new Internet protocols
to which our products must be ported. It is unclear which of these competing
protocols ultimately will achieve market acceptance. If the protocols upon
which our Internet products are based ultimately fail to be widely adopted,
our business, financial condition and results of operations may be materially
and adversely affected.

     It is difficult to predict whether demand for any of these products will
develop or increase in the future. If these markets, or any other new market
we target in the future, fail to develop, develop more slowly than
anticipated or become saturated with competitors, if our products are not
developed in a timely manner, or if our products and services do not achieve
or sustain market acceptance, our business, financial condition and results
of operations would suffer.

WE FACE INTENSE COMPETITION, WHICH COULD ADVERSELY AFFECT OUR ABILITY TO
MAINTAIN OR INCREASE SALES OF OUR PRODUCTS

     The embedded real-time software industry is highly competitive. We
believe that our principal competition comes from companies that develop
real-time operating systems in-house rather than purchase such systems from
independent software vendors such as Wind River. We also compete with other
independent software vendors, including Accelerated Technology, Inc.,
Integrated Systems, Inc., Mentor Graphics, Inc., Microsoft Corporation,
Microware Systems Corporation, QNX Software Systems, Ltd., and Sun
Microsystems, Inc. In addition, hardware or other software vendors could seek
to expand their product offerings by designing and selling products that
directly compete with or adversely affect sales of our products. Many of our
existing and potential competitors have substantially greater financial,
technical, marketing and sales resources. As a result, they may be able to
respond more quickly to new or emerging technologies and changes in customer
requirements, or to devote greater resources to the development, promotion,
sale and support of their products. Moreover, our competitors may foresee the
course of market developments more accurately than we do and could in the
future develop new technologies that compete with our products or even render
our products obsolete. Although we believe we presently have certain
technological and other advantages over our competitors, realizing and
maintaining such advantages will require a continued high level of investment
in research and development, marketing and customer service and support. In
addition, competitive pressures could cause us to reduce the prices of our
products, run-time royalties and services, which would result in reduced
profit margins. If we are unable to

                                       5
<PAGE>

compete successfully, our business, financial condition and results of
operations would be materially and adversely affected.

ACQUISITIONS MAY DISRUPT OUR BUSINESS, DILUTE OUR STOCKHOLDERS AND INCREASE
OUR INDEBTEDNESS

     As part of our business strategy, we have acquired or made investments
in several businesses, products and technologies that complement ours, and we
anticipate that we will continue to do so in the future. We may experience
difficulties integrating an acquired company's operations into ours. As a
result, we may divert management attention to the integration that would
otherwise be available for the ongoing development of our business.
Acquisitions have additional inherent risks, including:

     -    difficulties assimilating acquired operations, technologies or
          products

     -    unanticipated costs

     -    adverse effects on relationships with customers, suppliers and
          employees

     We may not be successful in integrating the businesses, products,
technologies or personnel we acquire, and our failure to do so could
materially adversely affect our business, financial condition and results of
operations. Similarly, we cannot guarantee that we may not have to writeoff
any of our investments or that our investments will yield a significant
return, if any. In addition, to finance acquisitions, we may issue equity
securities, which may dilute your investment in Wind River, or incur
significant indebtedness, which could materially adversely affect our results
of operations.

     Certain of our acquisitions have been accounted for under the
pooling-of-interests accounting method and financial reporting rules. To
qualify these acquisitions as pooling-of-interests for accounting purposes,
certain criteria established in opinions by the Accounting Principles Board
and interpreted by the Financial Accounting Standards Board and the SEC must
be met. These opinions are complex and the interpretation of them is subject
to change. In addition, the availability of pooling-of-interests accounting
treatment depends in part, upon circumstances and events occurring after the
acquisition. The failure of an acquisition to qualify for
pooling-of-interests accounting treatment for financial reporting purposes
for any reason would materially adversely affect our reported earnings and
likely, the price of our common stock.

WE SELL A SIGNIFICANT PORTION OF OUR PRODUCTS TO CUSTOMERS DEPENDENT UPON
GOVERNMENT FUNDING, WHICH MAY NOT CONTINUE TO BE AVAILABLE

     We have derived a portion of our revenues historically from sales of
systems built to the VME (versabus module eurocard) standard. These systems
typically are used in high cost, low volume applications, including military,
telecommunications, space and research applications. Although we believe that
revenues from sales of products designed for embedded systems applications
(non-VME customers) will account for an increasing percentage of our revenues
in the future, we do expect revenues from the VME market to continue to be
significant for the foreseeable future. Academic institutions and defense
industry participants, which generate most of our VME revenues, are dependent
on government funding. Any unanticipated future termination of government
funding of VME customers could have a material adverse effect on our
business, financial condition and results of operations.

                                       6
<PAGE>

FAILURE TO MANAGE OUR GROWTH COULD SIGNIFICANTLY STRAIN OUR PERSONNEL AND
OTHER RESOURCES

     We have experienced, and expect to continue to experience, significant
growth in our headcount and in the scope, complexity and geographic reach of
our operations. Our future success will depend, in part, on our ability to
continue to integrate new operations and personnel. To support this
expansion, we must continue to hire, train, motivate and manage our workforce
and improve our management controls, reporting systems and procedures. Our
current and planned personnel, systems, procedures and controls may not be
adequate to support our future operations. Failure to forecast our needs
accurately or to manage our growth appropriately could materially adversely
affect our business, financial condition and results of operations.

WE DEPEND ON OUR KEY PERSONNEL AND ON ATTRACTING QUALIFIED EMPLOYEES FOR OUR
FUTURE SUCCESS

     Our success depends to a significant degree upon the continued
contributions of our senior management and key technical personnel, any of
whom would be difficult to replace. The loss of these individuals could
materially adversely affect our operations. We believe our future success
will also depend on our ability to attract and retain additional
highly-skilled managerial, product development, marketing, sales, customer
support and operations personnel to support our growing business. Competition
for these personnel is intense, especially for engineers and especially in
the San Francisco Bay Area where we maintain our headquarters. We cannot be
certain that we will be successful in recruiting and retaining such
personnel. Our failure to do so could materially adversely affect our
business, financial condition and results of operations.

OUR INTERNATIONAL BUSINESS ACTIVITIES SUBJECT US TO RISKS THAT COULD
ADVERSELY AFFECT OUR BUSINESS

     During the three month period ended April 30, 1999 and the fiscal year
ended January 31, 1999, we derived approximately 41% and 34%, respectively,
of our total revenue from sales outside of North America. We expect that
international sales will continue to generate a significant percentage of our
total revenue in the foreseeable future and we also expect to continue to
make investments to further expand our international operations and to
increase our direct sales force in Europe and Asia.

     Risks inherent in international operations include:

     -    The imposition of governmental controls and regulatory requirements

     -    The costs and risks of localizing products for foreign countries

     -    Unexpected changes in tariffs, import and export restrictions and
          other barriers and restrictions

     -    Greater difficulty in accounts receivable collection

     -    The restrictions of repatriation of earnings

     -    The burdens of complying with a variety of foreign laws

     -    Difficulties in staffing and managing foreign subsidiaries and branch
          operations

                                       7
<PAGE>

     In addition, sales by Wind River's foreign subsidiaries are denominated
in the local currency, and an increase in the relative value of the dollar
against such currencies would reduce our revenues in dollar terms or make our
products more expensive and, therefore, potentially less competitive in
foreign markets. Gains and losses on the conversion to dollars of accounts
receivable, accounts payable and other monetary assets and liabilities
arising from international operations may contribute to fluctuations in our
results of operations. Although we enter into forward contracts to hedge the
short-term impact of foreign currency fluctuations, foreign currency
fluctuations could materially adversely affect Wind River's business,
financial condition and results of operations.

     We rely on distributors for sales of our products in certain foreign
countries. Accordingly, we are dependent on their ability to promote and
support our products and, in some cases, to translate them into foreign
languages. Wind River's international distributors generally offer products
of several different companies, including in some cases products that are
competitive with Wind River's products. We cannot predict that our
international distributors will continue to market our products or provide
them with adequate levels of support. Any changes in the relationships we
have with our international distributors may have a material adverse effect
on our business, financial condition and results of operations.

                                       8
<PAGE>

OUR INABILITY TO PROTECT OUR INTELLECTUAL PROPERTY PROTECTIONS WOULD IMPAIR
OUR COMPETITIVE POSITION

     We believe that our continued success depends primarily upon continuing
innovation, marketing, and technical expertise, as well as the quality of
product support and customer relations. At the same time, our success is
partially dependent upon the proprietary technology contained in our
products. We currently rely on a combination of patents, copyrights,
trademarks, trade secret laws, and contractual provisions to establish and
protect our intellectual property rights in our products. We cannot be
certain that the steps we take to protect our intellectual property will
adequately protect our rights, that others will not independently develop or
otherwise acquire equivalent or superior technology, or that we can maintain
such technology as trade secrets. End user licenses of our software are
frequently in the form of shrink wrap or click wrap license agreements, which
are not signed by licensees, and these may be unenforceable in some cases.
Policing unauthorized use of our products is difficult, and while we are
unable to determine the extent to which software piracy of our products
exists, software piracy can be expected to be a persistent problem. In
addition, employees, consultants, and others who participate in the
development of our products may breach their agreements with us regarding our
intellectual property, and we may not have adequate remedies for any such
breach. Finally, the laws of some of the countries in which our products are
or may be developed, manufactured or sold may not protect our products and
intellectual property rights to the same extent as the laws of the United
States or at all. We may initiate claims or litigation against third parties
for infringement of our proprietary rights or to establish the validity of
our proprietary rights. Litigation to determine the validity of any claims,
whether or not such litigation is determined in our favor, could result in
significant expense to us and divert the efforts of our technical and
management personnel from productive tasks. Our failure to protect our
intellectual property rights could have a material adverse effect on our
business, and financial condition and results of operations.

THIRD PARTY CLAIMS OF PATENT INFRINGEMENT COULD RESULT IN SUBSTANTIAL COST

     We occasionally receive communications from third parties alleging
patent infringement, and there is always the chance that third parties may
assert infringement claims against us. Any such claims, with or without
merit, could result in costly litigation, expense of significant resources to
develop non-infringing technology, cause product shipment delays or require
us to enter into royalty or licensing agreements. We cannot be certain that
the necessary licenses will be available or that they can be obtained on
commercially reasonable terms. If we were to fail to obtain such royalty or
licensing agreements in a timely manner and on reasonable terms, our
business, financial condition and results of operations would be materially
adversely affected. We believe that our products and technology do not
infringe on the intellectual property rights of others or upon intellectual
property rights that may be granted in the future pursuant to pending
applications. We also believe that we will not be required to obtain licenses
of technology owned by other parties.




                                       9
<PAGE>

DEFECTS IN OUR PRODUCTS COULD ADVERSELY AFFECT OUR OPERATING RESULTS AND
EXPOSE WIND RIVER TO SIGNIFICANT PRODUCT LIABILITY CLAIMS

     Because of their complexity, software products, including Wind River's,
have in the past and may in the future contain undetected or unresolved
errors, particularly when first introduced or as new versions are released.
Despite extensive testing, errors may be found in our current or future
products or enhancements after commencement of commercial shipments. If this
occurs, we may experience delay in or loss of market acceptance and sales,
product returns, diversion of development resources, injury to our
reputation, and increased service and warranty costs, any of which could
materially adversely affect our business, financial condition and results of
operations.

     Our products are increasingly used in applications, such as network
infrastructure, transportation, medical and mission-critical business
systems, in which the failure of the embedded system could cause property
damage, personal injury or economic loss resulting in product liability
claims against us. Although our agreements with our customers typically
contain provisions intended to limit our exposure to liability claims, these
provisions may not be effective in doing so in all circumstances or in all
jurisdictions. We maintain product liability insurance covering certain
damages arising from use of our products, however such insurance may not
adequately cover claims brought against us. Liability claims against us could
require us to spend significant time and money in litigation and, if
successful, to pay significant damages. As a result, such claims could damage
our reputation and materially adversely affect our business, financial
condition and results of operations.

WE HAVE SUBSTANTIAL DEBT SERVICE AND PRINCIPAL REPAYMENT OBLIGATIONS, WHICH
COULD MAKE IT DIFFICULT FOR US TO OBTAIN FINANCING

     We sold $140 million of 5% convertible subordinated notes in 1997, which
mature in 2002. This debt financing increased significantly both the ratio of
our long-term debt to our total capitalization and our interest expenses. The
degree to which we are leveraged could materially adversely affect our
ability to obtain financing for working capital or acquisitions, should we
need to do so. The notes are convertible into our common stock at a price of
$32.33 per share, and no notes have been converted to date. On August 1,
2002, we will be required either to pay off or refinance any unconverted
notes. We do not know if we will be able to refinance the notes on favorable
terms or at all. If a significant amount of the notes remains unconverted at
maturity and we are unable to refinance the notes, the repayment would
deplete our cash reserves significantly.

THE YEAR 2000 PROBLEM MAY ADVERSELY AFFECT OUR BUSINESS, FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

     The "year 2000 problem" is typically the result of limitations of
certain software written using two digits rather than four digits to define
the applicable year resulting in certain programs recognizing "00" as the
year 1900 rather than the year 2000. If systems do not currently recognize
date information when the year changes to 2000, there could be an adverse
impact on our operations. The risk exists primarily in four areas:

                                       10
<PAGE>

     -    Potential warranty or other claims from our customers, which may
          result in significant expense to Wind River

     -    Failure of systems we use to run our business, which could disrupt our
          business operations

     -    Failure of systems used by our suppliers, which could delay or affect
          the quality of our manufacturing or products

     -    The potential failure of our products due to Year 2000 problems, which
          may require that we replace any such products and potentially incur
          significant unexpected expenses

     Although we believe our most current releases of our products, including
third party software integrated into certain products are year 2000
compliant, because all customer situations cannot be anticipated, we may
see an increase in warranty and other claims as a result of the year 2000
transition. In addition, litigation regarding year 2000 compliance issues may
increase. Significant customer claims or litigation, even if decided in our
favor, could have a material adverse impact on our business, financial
condition, or results of operations.

     The majority of our products are combined by our customers with other
software programs or hardware devices not provided by us. These combinations
with other products that are not year 2000 compliant or modifications of our
products by our customers may introduce year 2000 issues for our customers.
Our customers' inability to remedy their own year 2000 problems could affect
their demand for our products which could materially and adversely affect our
business, financial condition and results of operations.

OUR STOCK PRICE HAS BEEN AND MAY CONTINUE TO BE VOLATILE

     The trading price of our common stock has been and is likely to be
volatile. It could fluctuate widely in response to a variety of factors,
including:

     -    actual or anticipated variations in our operating results

     -    announcements of new products or significant events or transactions by
          us or our competitors

     -    changes in our industry

     -    changes in financial estimates by securities analysts

     -    pricing pressures

     -    general market conditions

     -    events affecting other companies that investors believe to be
          comparable to us

     -    other events or factors that may be beyond our control

     In recent years, the stock markets in general and the shares of
technology companies in particular have experienced extreme price
fluctuations. These fluctuations often have been unrelated or
disproportionate to the operating performance of the companies affected. Any
change in investors' perception of our prospects could depress our stock
price regardless of our results. Other broad market and industry factors may
decrease our stock price, as may general political or economic conditions
such as recessions or interest rate or currency fluctuations. In the past,
following declines in the market price of a company's securities, securities
class action

                                       11
<PAGE>

litigation often has been instituted against the company. Litigation of this
type, even if ultimately unsuccessful, could result in substantial costs and
a diversion of management's time and focus, which could materially affect our
business, financial condition and results of operations.

                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     Some of the statements in this prospectus and the documents incorporated
by reference are forward-looking statements. These statements involve known
and unknown risks, uncertainties, and other factors that may cause our or our
industry's results, levels of activity, performance, or achievements to be
materially different from any future results, levels of activity,
performance, or achievements expressed or implied by such forward-looking
statements. These factors include, among others, those listed under "risk
factors" and in the documents incorporated by reference.

     In some cases, you can identify forward-looking statements by
terminology such as "may," "will," "should," "expects," "plans,"
"anticipates," "believes," "estimates," "predicts," "potential," "or
"continue" or the negative of such terms or other comparable terminology.
Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, events, levels
of activity, performance or achievements. We do not assume responsibility for
the accuracy and completeness of the forward-looking statements. We do not
intend to update any of the forward-looking statements after the date of this
prospectus to conform them to actual results.






                                       12
<PAGE>

                         WHERE YOU CAN FIND INFORMATION
                     CONCERNING WIND RIVER AND THIS OFFERING

     You should rely only on the information provided or incorporated by
reference in this prospectus. We have authorized no one to provide you with
different information. We are not making an offer of these securities in any
state where the offer is not permitted. You should not assume that the
information in this prospectus or any prospectus supplement is accurate as of
any date other than the date on the front of the document.

     We have filed with the SEC a registration statement on Form S-3 to
register the common stock offered by this prospectus. However, this
prospectus does not contain all of the information contained in the
registration statement and the exhibits and schedules to the registration
statement. We strongly encourage you to carefully read the registration
statement and the exhibits and schedules to the registration statement.

     We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. You can request copies of these documents by contacting
the SEC and paying a fee for the copying cost. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms. Our SEC
filings are also available to the public from the SEC's website at
www.sec.gov.

     The SEC allows us to "incorporate by reference" the information
contained in documents that we file with them, which means that we can
disclose important information to you by referring you to those documents.
The information incorporated by reference is considered to be part of this
prospectus. Information in this prospectus supersedes information
incorporated by reference which we filed with the SEC prior to the date of
this prospectus, while information that we file later with the SEC will
automatically update and supersede this information. We incorporate by
reference the documents listed below and any future filings we will make with
the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934:

1.   Our Annual Report on Form 10-K for the fiscal year ended January 31, 1999;

2.   Our Quarterly Report on Form 10-Q for the fiscal quarter ended April 30,
     1999;

3.   Our Current Reports on Form 8-K dated May 3, 1999 and July 16, 1999;

4.   The description of the common stock contained in our registration statement
     on Form 8-A filed on March 12, 1993.

You may request a copy of these filings, at no cost to you, by writing or
telephoning us at:

                            Wind River Systems, Inc.
                               500 Wind River Way
                            Alameda, California 94501
                            Telephone: (510) 748-4100



                                       13
<PAGE>

                                 USE OF PROCEEDS

Wind River will not receive any proceeds from the sale of common stock by
the selling stockholders in the offering.

                   INFORMATION ABOUT THE SELLING STOCKHOLDERS

     The following table sets forth the names of the selling stockholders and
the number of shares of common stock owned by each of them as of July 30,
1999 which may be offered pursuant to this prospectus. This information is
based upon information provided by the selling stockholders. Because the
selling stockholders may offer all, some or none of their common stock, no
definitive estimate as to the number of shares thereof that will be held by
the selling stockholders after such offering can be provided.

<TABLE>
<CAPTION>

                                 SHARES BENEFICIALLY
                                        OWNED                            SHARES BENEFICIALLY OWNED
                                 PRIOR TO OFFERING(1)                          AFTER OFFERING
                                ---------------------   SHARES BEING   ----------------------------
           NAME                  NUMBER    PERCENT(2)     OFFERED        NUMBER           PERCENT
- ------------------------------  ---------  ----------  --------------  -------------    -----------
<S>                             <C>        <C>         <C>             <C>              <C>
Ross Wheeler (3)                 456,827      *           456,827          -0-                -

Advanced Logic Research, Inc.    274,096      *           274,096          -0-                -
</TABLE>
- ---------------
    *    Less than one percent.

    (1)  Beneficial ownership is determined in accordance with the rules of
the SEC and generally includes voting or investment power with respect to
securities. Except as otherwise indicated by footnote, and subject to
community property laws where applicable, the persons named in the table have
sole voting and investment power with respect to all shares of common stock
shown as beneficially owned by them.

    (2)  Based on 41,737,990 shares of common stock outstanding net of
treasury shares on July 30, 1999.

    (3)  Mr. Wheeler was previously President and a director of RouterWare,
Inc., currently a wholly-owned subsidiary of Wind River.





                                       14
<PAGE>

                              PLAN OF DISTRIBUTION

     The shares of common stock offered hereby may be sold by the selling
stockholders, or by donees, pledgees, transferees or other successors in
interest who receive such shares as a gift or other non-sale transfer, and
who shall be deemed to be selling stockholders hereunder. Such shares may be
sold from time to time to purchasers directly by each of the selling
stockholders acting as principal for its own account or through underwriters,
dealers or agents who may receive compensation in the form of underwriting
discounts, commissions or concessions from the selling stockholders and/or
the purchasers of shares for whom they may act as agent. Sales may be made on
the Nasdaq National Market or in private transactions or in a combination of
such methods of sale, at fixed prices that may be changed, at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at negotiated prices. In addition to sales of common stock pursuant
to the Registration Statement of which this prospectus is a part, the selling
stockholders may sell such common stock in compliance with Rule 144
promulgated under the Securities Act.

     From time to time one or more of the selling stockholders may transfer,
pledge, donate or assign such selling stockholders' shares to lenders or
others and each of such persons will be deemed to be a selling stockholder
for purposes of this prospectus. The number of selling stockholders' shares
beneficially owned by those selling stockholders who so transfer, pledge,
donate or assign selling stockholders' shares will decrease as and when they
take such actions. The plan of distribution for selling stockholders' shares
hereunder will otherwise remain unchanged, except that the transferees,
pledgees, donees or other successors will be selling stockholders hereunder.

     The selling stockholders and any underwriters, dealers or agents that
participate in the distribution of the common stock offered hereby may be
deemed to be underwriters within the meaning of the Securities Act, and any
discounts, commissions or concessions received by them and any provided
pursuant to the sale of shares by them might be deemed to be underwriting
discounts and commissions under the Securities Act.

     In order to comply with the securities laws of certain states, if
applicable, the common stock will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
common stock may not be sold unless it has been registered or qualified for
sale or an exemption from registration or qualification requirements is
available and is complied with.

     The shares of common stock offered hereby were issued to the selling
stockholders pursuant to an exemption from the registration requirements of
the Securities Act provided by Section 4(2) thereof. We agreed to register
those shares under the Securities Act and to indemnify and hold the selling
stockholders harmless against certain liabilities under the Securities Act
that could arise in connection with the sale by the selling stockholders of
the shares. The Company has agreed to pay all reasonable fees and expenses
incident to the filing of this Registration Statement.

                                       15
<PAGE>

                                  LEGAL MATTERS

     The validity of the shares will be passed upon for Wind River by Cooley
Godward LLP, Palo Alto, California.

                                     EXPERTS

     The consolidated financial statements incorporated in this prospectus by
reference to the Annual Report on Form 10-K of Wind River Systems, Inc. for
the year ended January 31, 1999 have been so incorporated in reliance on
the report of PricewaterhouseCoopers LLP, independent accountants, given on
the authority of said firm as experts in auditing and accounting.




                                       16
<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                        PAGE
<S>                                                                    <C>
The Company............................................................   2
Risk Factors...........................................................   3
Special Note Regarding Forward Looking Statements......................  12
Where You Can Find Information About Wind River and This Offering......  13
Use of Proceeds........................................................  14
Information About the Selling Stockholders.............................  14
Plan of Distribution...................................................  15
Legal Matters..........................................................  16
Experts................................................................  16
</TABLE>


                           WIND RIVER SYSTEMS, INC.

                               August 24, 1999


                                       17


© 2022 IncJournal is not affiliated with or endorsed by the U.S. Securities and Exchange Commission