<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 17, 1996
REGISTRATION NO. 333-______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
----------------------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------------------------
CASCADE COMMUNICATIONS CORP.
(Exact name of Registrant as specified in its charter)
DELAWARE 04-3099677
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
5 CARLISLE ROAD
WESTFORD, MASSACHUSETTS 01886-3601
(508) 692-2600
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
----------------------------------------
DANIEL E. SMITH
PRESIDENT AND CHIEF EXECUTIVE OFFICER
5 CARLISLE ROAD
WESTFORD, MASSACHUSETTS 01886-3601
(508) 692-2600
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
----------------------------------------
COPIES TO:
JOHN A. MELTAUS, ESQ.
Testa, Hurwitz & Thibeault, LLP
High Street Tower, 125 High Street
Boston, Massachusetts 02110
(617) 248-7000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this registration statement becomes effective.
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, 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 of 1933, please check the
following box and list the Securities Act registration number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434
under the Securities Act of 1933, check the following box. / /
----------------------------------------
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
======================= ================== =========================== ============================= ========================
TITLE OF SHARES TO BE AMOUNT TO BE PROPOSED MAXIMUM OFFERING PROPOSED MAXIMUM AMOUNT OF REGISTRATION
REGISTERED REGISTERED PRICE PER SHARE(1) AGGREGATE OFFERING PRICE(1) FEE(2)
- ----------------------- ------------------ --------------------------- ----------------------------- ------------------------
<S> <C> <C> <C> <C>
Common Stock, $.001
par value.............. 3,176,566 shares $62.00 $196,947,092.00 $67,912.79
======================= ================== =========================== ============================= ========================
<FN>
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457 under the Securities Act of 1933.
(2) Pursuant to Rule 457(c) of the Securities Act of 1933, the registration fee
has been calculated based upon the average of the high and low prices per
share of Common Stock reported on the Nasdaq National Market on June 14, 1996.
</TABLE>
----------------------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
-----------------------
SUBJECT TO COMPLETION, DATED JUNE 17, 1996
PROSPECTUS
3,176,566 SHARES
[CASCADE LOGO]
CASCADE COMMUNICATIONS CORP.
COMMON STOCK
-----------------------
This Prospectus relates to the sale of up to 3,176,566 shares (the
"Shares") of the common stock, par value $.001 per share (the "Common Stock"),
of Cascade Communications Corp., a Delaware corporation ("Cascade" or the
"Company"), by certain stockholders of the Company (collectively, the "Selling
Stockholders"). The Selling Stockholders may sell the Shares from time to time
at market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Stockholders may
effect these transactions by selling the Shares to or through broker-dealers,
who may receive compensation in the form of discounts or commissions from the
Selling Stockholders or from the purchasers of the Shares for whom the
broker-dealers may act as an agent or to whom they may sell as principal, or
both. See "Selling Stockholders" and "Plan of Distribution."
The Company will not receive any of the proceeds from the sale of the
Shares. The Company has agreed to bear all of the expenses in connection with
the registration and sale of the Shares (other than selling commissions).
The Common Stock of the Company is quoted on the Nasdaq National Market
under the symbol "CSCC". On June 14, 1996, the last reported sale price for the
Common Stock on the Nasdaq National Market was $60.75 per share.
---------------
FOR A DISCUSSION OF CERTAIN RISKS OF AN INVESTMENT IN THE SHARES OFFERED HEREBY,
SEE "RISK FACTORS" ON PAGE 4.
---------------
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 July ___, 1996.
<PAGE> 3
AVAILABLE INFORMATION
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
Securities and Exchange Commission (the "Commission"). Reports, proxy statements
and other information filed by the Company may be inspected and copied at the
public reference facilities maintained by the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the Commission's regional offices located at
7 World Trade Center, New York, New York 10048, and at Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Copies may also be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. The Common Stock of the Company is
listed on the Nasdaq National Market. Reports, proxy statements and other
information concerning the Company may be inspected at the offices of the
National Association of Securities Dealers, Inc. located at 1735 K Street, N.W.,
Washington, D.C. 20006.
The Company has filed with the Commission a Registration Statement on Form
S-3 (including all amendments thereto, the "Registration Statement") under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
Common Stock offered hereby. This Prospectus does not contain all 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 regarding the Company and the Common Stock offered hereby, reference
is hereby made to the Registration Statement and to the exhibits and schedules
filed therewith. Statements contained in this Prospectus regarding the contents
of any agreement or other document filed as an exhibit to the Registration
Statement are necessarily summaries of such documents, and in each instance
reference is made to the copy of such document filed as an exhibit to the
Registration Statement for a more complete description of the matters involved.
The Registration Statement, including the exhibits and schedules thereto, may be
inspected at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549 and copies of all or any part thereof
may be obtained from such office upon payment of the prescribed fees.
The Company will provide without charge to each person to whom a Prospectus
is delivered, on the written or oral request of any such person, a copy of any
or all of the documents incorporated by reference herein (other than exhibits to
such documents unless such exhibits are specifically incorporated by reference
into such documents). Requests for such copies should be directed to Paul E.
Blondin, Chief Financial Officer, Cascade Communications Corp., 5 Carlisle Road,
Westford, Massachusetts 01886, telephone number (508) 692-2600.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by the Company with the Commission pursuant
to the Exchange Act are incorporated in this Prospectus by reference (File No.
0-24578):
1. The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995.
2. The Company's Quarterly Report on Form 10-Q for the quarter ended
March 30, 1996.
3. The Company's Current Report on Form 8-K dated May 3, 1996, reporting
the merger by the Company of Arris Networks, Inc., a Delaware
corporation ("Arris").
4. The Company's Current Reports on Form 8-K dated February 27, 1996 and
May 30, 1996.
5. The description of the Company's Common Stock, $.001 par value per
share, contained in the Registration Statement on Form 8-A filed under
the Exchange Act on July 26, 1994, including any amendment or report
filed for the purpose of updating such description.
2
<PAGE> 4
All documents subsequently filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act, prior to the termination of the offering
of the Shares, shall be deemed to be incorporated by reference in this
Prospectus and made a part hereof from the date of filing of such documents. Any
statement contained in a document incorporated or deemed to be incorporated by
reference in this Prospectus 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 also is or is deemed to be
incorporated by reference herein or in any Prospectus Supplement 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.
3
<PAGE> 5
RISK FACTORS
In addition to the other information presented in this Prospectus and the
information incorporated in this Prospectus by reference, the following risk
factors should be considered carefully in evaluating the Company and its
business before purchasing the Common Stock offered hereby.
Risks Associated with the Integration of Arris. The successful and timely
integration of Cascade and Arris, and the development by Arris of new products
for the remote access market, is important to the future financial performance
of Cascade. To date, Arris has been engaged primarily in research and
development, and has not yet introduced a product or generated revenue. The
diversion of attention of management created by the integration process, and any
difficulties encountered in that process or product development, could have an
adverse impact on the revenue and operating results of the Company. There can be
no assurance that the combined company will retain the Arris employees that it
wishes to retain, or that the combined company will realize any of the
anticipated benefits of the combination.
Fluctuations in Revenue and Operating Results. The growth rates recently
experienced by the Company are not necessarily indicative of the operating
results for any future periods. The Company's operating results may fluctuate as
a result of a number of factors, including the timing of orders from, and
shipments to, customers; the timing of new product introductions and the market
acceptance of those products; increased competition; changes in manufacturing
costs; changes in the mix of product sales; the rate of end user adoption and
carrier and private network development of WAN data communications services;
factors associated with international operations; and changes in world economic
conditions.
Evolving Market. The Company's success will depend in part on the growth in
the broadband packet equipment market. The market for these services continues
to evolve, and there are a number of competing technologies providing these
services. Regulatory policies affecting the telecommunications industry in the
United States and internationally are likely to continue to have a significant
impact on pricing and demand for both voice and data communications products and
services. There can be no assurance whether, and at what rate, end user demand
will develop for these services or that public carriers or private networks will
continue to adopt the Company's products and technology to implement these
services.
Management of Growth. The Company is currently experiencing a period of
rapid growth which has placed, and could continue to place, a significant strain
on the resources. In order to support the growth of its business, the Company
plans to significantly expand its level of operations during 1996. If the
Company's management is unable to manage growth effectively, the Company's
operating results could be adversely affected.
Dependence on Key Employees. The Company's success depends to a significant
degree upon the continuing contributions of its key management, sales,
marketing, research and development and manufacturing personnel, many of whom
would be difficult to replace. The Company does not have employment contracts
with its key personnel. The Company believes that its future success will depend
in large part upon its ability to attract and retain highly-skilled hardware and
software engineers, and management, sales and marketing personnel. Competition
for such personnel is intense, and there can be no assurance that the Company
will be successful in attracting and retaining such personnel. Failure to
attract and retain key personnel could have a material adverse effect on the
Company's business, operating results and financial condition.
Competition. The market for wide area network communications products is
intensely competitive and is subject to rapid technological change. The Company
expects competition to increase significantly in the future from existing
competitors and a number of companies which may enter the Company's existing or
future markets. In addition to competition from other switch providers, the
Company expects to face competition from other vendors in the internetworking
market such as network router vendors, who may incorporate switching
functionality into their products or provide alternative network solutions.
Increased competition could adversely affect the Company's revenue and
profitability through price reductions and loss of market share. The principal
competitive factors in the market for switching products are breadth of network
services supported, conformance to industry
4
<PAGE> 6
standards, price per port, performance, product features, network management
capabilities, reliability and customer support. Many of the Company's current
and potential competitors have longer operating histories and substantially
greater financial, technical, sales and marketing resources than the Company.
There can be no assurance that the Company will be able to continue to compete
successfully with its existing competitors or will be able to compete
successfully with new competitors.
Third Party Manufacturing. The Company relies on a limited number of
independent contractors who manufacture the components used in the Company's
products to the Company's specifications. In the event that the Company's
subcontractors were to experience financial, operational, production, or quality
assurance difficulties that resulted in a reduction or interruption in supply to
the Company, the Company's operating results would be adversely affected until
the Company established sufficient manufacturing supply from alternative
sources. While to date there has been suitable third-party manufacturing
capacity readily available, there can be no assurance that such manufacturers
will be able to meet the Company's future requirements or that such services
will continue to be available to the Company at favorable prices.
Dependence on Sole Source Suppliers. The Company is dependent upon a single
supplier or a limited number of suppliers for several components and parts used
in the Company's products, including the Intel i960 microprocessor and other
integrated circuits. There can be no assurance that these suppliers will be able
to meet the Company's future requirements for such components or that the
components will be available to the Company at favorable prices. The Company
generally purchases these single or limited source components pursuant to
purchase orders and has no guaranteed supply arrangements with the suppliers. In
addition, the availability of many of these components to the Company is
dependent in part on the ability of the Company or its subcontractors to provide
the suppliers with accurate forecasts of future requirements. The Company has
generally been able to obtain adequate supplies of parts and components in a
timely manner from existing sources. However, any extended interruption in the
supply of any of the key components currently obtained from a single or limited
source could have a material adverse effect on the Company's operating results
in any given period.
Technological Change. The market for the Company's products is
characterized by rapidly changing technology, evolving industry standards,
emerging network architectures, and frequent new product introductions. Current
competitors or new market entrants may develop new products with features that
could adversely affect the competitive position of the Company's products. There
can be no assurance that the Company will be successful in selecting,
developing, manufacturing and marketing new products or enhancing its existing
products or that the Company will be able to respond effectively to
technological changes, new standards or product announcements by competitors.
The timely availability of new products and enhancements, and their acceptance
by customers, are important to the future success of the Company. Delays in such
availability or a lack of market acceptance could have an adverse affect on the
Company.
Customer Concentration. The Company's customer base is highly concentrated
among a limited number of large customers, many of whom generally require
product vendors to comply with rigorous industry standards. Any failure to
comply with such standards may result in a significant loss or reduction of
sales. The Company has diversified its customer base over time; however, in each
of the last three years, certain customers have accounted for over 10% of the
Company's revenue. In 1995, sales to the Company's two largest customers in that
year accounted for approximately 12% and 17% of revenue, respectively. In 1994,
sales to the Company's two largest customers in that year accounted for
approximately 12% and 11% of revenue, respectively. In 1993, sales to the
Company's two largest customers in that year accounted for approximately 21% and
14% of revenue, respectively. No other customer accounted for 10% or more of
revenue in any such year. There can be no assurance that these customers will
place additional orders, or that the Company will obtain orders of similar
magnitude from other customers. A decline in demand from public network carriers
would have an adverse effect on the Company's operating results.
International Operations. International sales (sales to customers outside
the United States) accounted for approximately 16% and 20% of the Company's
revenue in 1995 and 1994, respectively, and approximately 16% of the Company's
revenue in the first quarter of 1996. The Company anticipates that international
sales will continue to account for a significant portion of revenue. The
Company's international sales are subject to risks inherent in
5
<PAGE> 7
foreign operations including unexpected changes in regulatory requirements,
tariffs or other barriers and potentially negative tax consequences. In
addition, sales of the Company's products in international markets are heavily
dependent on third-party distribution channels. To date, the Company's
international sales have been denominated in U.S. currency; however, if this
were to change, the Company would be subject to exchange rate fluctuations.
Uncertainties Regarding Patents and Protection of Proprietary Technology.
The Company's success will depend, to a large extent, on its ability to protect
its proprietary technology. The Company has a number of patent applications that
are currently pending for certain of its existing products and currently relies
on a combination of contractual rights, trade secrets and copyrights to protect
its proprietary rights. Although the Company intends to apply for additional
patents in the future, there can be no assurance that the Company's intellectual
property protection will be sufficient to prevent competitors from developing
similar technology. Moreover, in the absence of patent protection, the Company's
business may be adversely affected by competitors that independently develop
functionally equivalent technology. The Company currently licenses certain
hardware and software technology from third parties and plans to continue to do
so in the future. The Company attempts to ensure that its products and processes
do not infringe patents and other proprietary rights, but there can be no
assurance that such infringement may not be alleged by third parties in the
future. If infringement is alleged, there can be no assurance that the necessary
licenses would be available on acceptable terms, if at all, or that the Company
would prevail in any such challenge.
Possible Volatility of Stock Price. The market price of the Company's
Common Stock has increased significantly since the Company's initial public
offering in July 1994, and has experienced fluctuations during this period. The
period since the initial public offering was marked by generally rising stock
prices, favorable industry conditions and improved operating results of the
Company, all of which are subject to change. The trading price of the Company's
Common Stock could be subject to wide fluctuations in response to
quarter-to-quarter variations in operating results, changes in earnings
estimates by analysts, announcements of technological innovations or new
products by the Company or its competitors, and other events or factors. In
addition, the stock market has from time to time experienced extreme price and
volume fluctuations which have particularly affected the market price for many
high technology companies and which often have been unrelated to the operating
performance of these companies. These broad market fluctuations may adversely
affect the market price of the Company's Common Stock.
Effect of Anti-takeover Provisions. Certain provisions of the Company's
Amended and Restated Certificate of Incorporation, as amended, and Amended and
Restated By-laws could have the effect of making it more difficult for a third
party to acquire, or of discouraging a third party from attempting to acquire,
control of the Company. Such provisions could limit the price that certain
investors might be willing to pay in the future for shares of the Company's
Common Stock. Certain of such provisions allow the Company to issue Preferred
Stock with rights senior to those of the Common Stock and impose various
procedural and other requirements which could make it more difficult for
stockholders to effect certain corporate actions. The Company's Board of
Directors is divided into three classes, each of which serves for a staggered
three-year term. Such staggered Board may make it more difficult for a third
party to gain control of the Company's Board of Directors.
6
<PAGE> 8
THE COMPANY
Cascade Communications Corp. develops, manufactures, markets and supports a
family of high performance, multi-service wide area network switches that enable
public service providers and private network managers to provide cost-effective,
high-speed data, video and voice communications services. The Company's switches
are designed to support on a single platform one or more of the major broadband
packet communications services, including frame relay, Switched Multi-Megabit
Data Service ("SMDS") and Asynchronous Transfer Mode ("ATM"). The Company's
products also provide access services for Transmission Control Protocol/Internet
Protocol ("TCP/IP") and Integrated Services Digital Network ("ISDN") users.
The rapid growth in the number of personal computers ("PCs"), workstations
and end-user applications has led to the extensive deployment of local area
networks ("LANs") in corporate environments. As these LAN-based users needed to
communicate with users at other sites, corporations installed multiprotocol
routers and bridges, which seamlessly interconnected multiple LANs, either
locally in a building or campus or throughout a corporation across wide area
networks ("WANs").
Traditional WAN architectures to connect these LANs across wide area
networks were based on time division multiplexing ("TDM") technology. TDM
products were optimized for fixed path, fixed bandwidth applications, such as
voice and low volume transaction processing data. However, they were not well
suited for dynamic, high bandwidth communications, such as LAN data from PCs and
workstations and LAN-based video. Although vendors of TDM products have provided
upgrade modules to support data and video traffic, these older architectures are
unable to scale to accommodate the rapid growth in the newer forms of
communications traffic and are unable to adapt to dynamic changes in network
topology. As such, a new generation of wide area network technologies, including
frame relay, SMDS and ATM, have been developed to address these needs.
Cascade has pioneered the concept of utilizing a single, powerful switching
platform to simultaneously support the three major broadband packet
communications services: frame relay, SMDS and ATM. Cascade's multi-service,
standards-based products enable public service providers and private network
managers to select the transmission services with the cost and performance
attributes that best fit the end user's requirements, without requiring them to
build multiple separate specialized networks.
The Company offers three product families of wide area network switches:
the STDX, the B-STDX(TM) and the Cascade 500(TM) ATM switch. The Company also
offers HyperPATH(TM), an ISDN based remote access solution fully integrated with
the B-STDX product line, and CascadeView(TM), a network management application
for the Company's switches.
The Company markets its products and services directly to public service
providers, including Interexchange Carriers ("IXCs"), Local Exchange Carriers
("LECs"), and Regional Bell Operating Companies ("RBOCs") in the United States,
Postal Telephone and Telegraph ("PTTs") internationally, and Competitive Access
Providers ("CAPs"), Internet Service Providers ("ISPs") and Value Added Network
providers ("VANs") worldwide. The Company's products and services are also sold
to private network managers on a worldwide basis either directly or via partners
of the Company, including Original Equipment Manufacturers ("OEMs"), such as
Network Equipment Technologies, Inc. ("N.E.T."), International Business Machines
Corporation ("IBM") and Advanced Compression Technologies, Inc. ("ACT"), system
integrators and international distributors.
The Company was incorporated in Delaware in 1990 under the name Nexgencom
Corporation and changed its name to Cascade Communications Corp. in August 1991.
The Company's principal executive offices are located at 5 Carlisle Road,
Westford, Massachusetts 01886, and its telephone number at that location is
(508) 692-2600.
7
<PAGE> 9
RECENT DEVELOPMENTS
Arris Acquisition. On May 3, 1996, the Company acquired all of the
outstanding shares of capital stock of Arris Networks, Inc. ("Arris"), a
Delaware corporation (the "Merger") pursuant to an Agreement and Plan of
Reorganization dated as of April 19, 1996 (the "Merger Agreement"), among the
Company, AN Acquisition Corp., a Delaware corporation and a wholly-owned
subsidiary of the Company, Arris and North Bridge Venture Management Company,
Inc., as the initial indemnification representative of the former Arris
stockholders. The Merger was accomplished through an exchange of up to 3,418,604
shares of the Company's Common Stock for all outstanding shares of capital stock
of Arris and the assumption of all outstanding options to acquire shares of
capital stock of Arris. The Merger has been accounted for under the
pooling-of-interests method. The purchase price and terms for the transaction
were determined in arms-length negotiations.
Stock Split. The Company effected a two-for-one stock split in the form of
a one-for-one stock dividend on May 30, 1996, which stock split in the form of a
stock dividend was paid to stockholders of record of the Company on May 21,
1996. All share and per share information in this Prospectus has been adjusted
as of each date given to reflect (i) a two-for-one stock split in the form of a
stock dividend in June 1995, (ii) a three-for-two stock split in the form of a
stock dividend in February 1996, and (iii) the two-for-one stock split in the
form of a stock dividend in May 1996.
USE OF PROCEEDS
The proceeds from the sale of each Selling Stockholder's Shares will belong to
the Selling Stockholder. The Company will not receive any of the proceeds from
such sales of the Shares.
8
<PAGE> 10
SELLING STOCKHOLDERS
<TABLE>
The following table sets forth certain information regarding ownership of the
Shares as of June 6, 1996 and the number of Shares that may be offered for the
account of the Selling Stockholders or their transferees or distributees from
time to time. All of the shares offered hereby were acquired in connection with
the Cascade acquisition of Arris. Because the Selling Stockholders or their
transferees or distributees may sell all or any part of their Shares pursuant to
this Prospectus, no estimate can be given as to the number of Shares that will
be held by each Selling Stockholder upon termination of this offering. See "Plan
of Distribution."
<CAPTION>
Shares
Shares Offered Percentage of
Owned prior Pursuant Shares Ownership
to the to this Owned after after the
Selling Stockholders Offering Prospectus the Offering(1) Offering(2)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Gary Bowen 18,734 18,734 -- *
Wu-Fu Chen(3) 2,849,714 280,070 2,569,644 2.9%
James A. Dolce, Jr.(4) 223,380 223,380 -- *
Steven G. Finn 31,238 11,240 19,998 *
Rubin Gruber 18,734 18,734 -- *
Thomas Hawkins 734 734 -- *
Philip H. Hayden 18,734 18,734 -- *
Timothy C. Jones 37,468 37,468 -- *
H. Daniel Lowe 47,084 47,084 -- *
Matrix IV Entrepreneurs Fund, 60,886 60,886 -- *
LP(5)
Matrix Partners IV, LP(5) 1,156,852 1,156,852 -- *
North Bridge Venture Partners, L.P. 655,704 655,704 -- *
Sean M. O' Sullivan 18,734 18,734 -- *
Oak Investment Partners VI, 189,936 189,936 -- *
Limited Partnership
Oak VI Affiliates Fund, Limited 4,430 4,430 -- *
Partnership
Thomas Schreffler 9,366 9,366 -- *
Frank Slaughter 4,858 4,858 -- *
VenRock Associates 120,508 120,508 -- *
VenRock Associates II, LP 73,860 73,860 -- *
Chin-Cheng Wu(6) 225,254 225,254 -- *
--------- --------- --------- ---
TOTAL 5,766,208 3,176,566 2,589,642 2.9%
<FN>
- -------------------------
*Less than 1%
(1) Assumes that all of the Shares owned by each Selling Stockholder and
offered under this Prospectus are sold during the distribution period.
(2) Based on shares of Common Stock outstanding as of June 6, 1996.
(3) Mr. Chen served the Company as Vice President of Engineering from January
1991 to May 1995 and as Vice President and Chief Technical Officer from May
1995 until July 1995.
(4) Following the Merger, Mr. Dolce became Vice President of Remote Access
Marketing of the Company.
(5) Paul J. Ferri is a general partner of the general partner of the Selling
Stockholder. Mr. Ferri has been a director of the Company since June 1991.
Mr. Ferri is also a general partner of the general partner of Matrix
Partners III, L.P., which held in excess of 5% of the outstanding shares of
Common Stock of the Company during 1993, 1994 and 1995. As of February 29,
1996, Matrix Partners III, L.P. owned no shares of Common Stock and, as
reported in the Company's proxy statement for the 1996 Annual Meeting of
Stockholders, Mr. Ferri beneficially owned 53,750 shares of Common Stock.
(6) Following the Merger, Mr. Wu became Vice President of Remote Access
Engineering of the Company.
</TABLE>
9
<PAGE> 11
Each Selling Stockholder represented to the Company in connection with the
completion of the Merger that he or it was purchasing the Shares from the
Company without any present intention of effecting a distribution of those
Shares. In recognition of the fact, however, that investors may want to be able
to sell their shares when they consider appropriate, the Company agreed to file
with the Commission a registration statement on Form S-3 (of which this
Prospectus is a part) to permit the public sale of the Shares by the Selling
Stockholders from time to time and to use its best efforts to keep the
registration statement effective until the earlier of the sale of the Shares
pursuant to the Registration Statement or May 3, 1998. The Company will prepare
and file such amendments and supplements to the registration statement as may be
necessary to keep it effective until the earlier of the sale of all Shares
pursuant to the registration statement or until May 3, 1998.
10
<PAGE> 12
PLAN OF DISTRIBUTION
The Shares offered hereby may be sold from time to time by the Selling
Stockholders for their own accounts. The Company will receive none of the
proceeds from this offering. The Selling Stockholders will pay or assume
brokerage commissions or other charges and expenses incurred in the sale of the
Shares.
The distribution of the Shares by the Selling Stockholders is not subject to any
underwriting agreement. The Shares covered by this Prospectus may be sold by the
Selling Stockholders or by pledgees, donees, transferees or other successors in
interest. The Shares offered by the Selling Stockholders may be sold from time
to time at market prices prevailing at the time of sale, at prices relating to
such prevailing market prices or at negotiated prices. The Shares may be sold by
one or more of the following: (a) one or more block trades in which a broker or
dealer so engaged will attempt to sell all or a portion of the Shares held by a
Selling Stockholder as agent but may position and resell a portion of the block
as principal to facilitate the transaction; (b) purchases by a broker or dealer
as principal and resale by such broker or dealer for its account pursuant to
this Prospectus; and (c) ordinary brokerage transactions and transactions in
which the broker solicits purchasers. In addition, the Selling Stockholders may
sell their Shares covered by this Prospectus through customary brokerage
channels, either through broker-dealers acting as agents or brokers, or through
broker-dealers acting as principals, who may then resell the Shares, or at
private sale or otherwise, at market prices prevailing at the time of sale, at
prices related to such prevailing market prices or at negotiated prices. The
Selling Stockholders may effect such transactions by selling Shares to or
through broker-dealers, and such broker-dealers may receive compensation in the
form of underwriting discounts, concessions, commissions, or fees from the
Selling Stockholders and/or purchasers of the Shares for whom such
broker-dealers may act as agent or to whom they sell as principal, or both
(which compensation to a particular broker-dealer might be in excess of
customary commissions). Any broker-dealers that participate with the Selling
Stockholders in the distribution of Shares may be deemed to be underwriters and
any commissions received by them and any profit on the resale of Shares placed
by them might be deemed to be underwriting discounts and commissions within the
meaning of the Securities Act, in connection with such sales.
Any shares covered by the Prospectus that qualify for sale pursuant to Rule 144
under the Securities Act may be sold under Rule 144 rather than pursuant to this
Prospectus.
11
<PAGE> 13
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be passed upon
for the Company by Testa, Hurwitz & Thibeault, LLP, Boston, Massachusetts.
EXPERTS
The consolidated financial statements of Cascade Communications Corp., included
in the Report on Form 10-K of the Company for the fiscal year ended December 31,
1995 referred to above, have been audited by Coopers & Lybrand L.L.P.,
independent accountants, as set forth in their report dated February 1, 1996
accompanying such financial statements, and are incorporated herein by reference
in reliance upon the report of such firm, which report is given upon their
authority as experts in accounting and auditing.
12
<PAGE> 14
<TABLE>
- ------------------------------------------------- -----------------------------------------------------
<S> <C>
No person has been authorized to give any 3,176,566 SHARES
information or to make any representation
other than those 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, any
Selling Stockholder or any other person. This CASCADE
Prospectus does not constitute an offer to sell COMMUNICATIONS CORP.
or a solicitation of an offer in any
jurisdiction in which such offer or
solicitation would be unlawful or to any
person to whom it is unlawful. Neither the
delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, COMMON STOCK
create an implication that there has been no
change in the affairs of the Company or that
information contained herein is correct as of
any time subsequent to this date hereof.
----------- ----------
TABLE OF CONTENTS PROSPECTUS
Page
---- ----------
Available Information....................... 2
Incorporation of Certain Information by
Reference................................ 2
Risk Factors................................ 4
The Company................................. 7
Recent Developments......................... 8
Use of Proceeds............................. 8
Selling Stockholders........................ 9
Plan of Distribution........................ 11 JULY __, 1996
Legal Matters............................... 12
Experts..................................... 12
- ------------------------------------------------- -----------------------------------------------------
</TABLE>
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
Estimated expenses (other than underwriting discounts and commissions) payable
in connection with the sale of the Common Stock offered hereby are as follows:
<S> <C>
SEC Registration Fee $ 67,912.79
Nasdaq Filing Fee 17,500.00
Legal fees and expenses 20,000.00
Accounting fees and expenses 20,000.00
Blue Sky fees and expenses (including legal fees) 2,000.00
-----------
Total $127,412.79
The Company will bear all expenses shown above.
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Delaware General Corporation Law and the Company's certificate of
incorporation and by-laws, each as amended, provide for indemnification of the
Company's directors and officers for liabilities and expenses that they may
incur in such capacities. In general, directors and officers are indemnified
with respect to actions taken in good faith in a manner reasonably believed to
be in, or not opposed to, the best interests of the Company, and with respect to
any criminal action or proceeding, actions that the indemnitee had no reasonable
cause to believe were unlawful. Reference is made to the Company's amended and
restated certificate of incorporation filed as Exhibit 3.1 to the Company's
Registration Statement on Form S-1 (No. 33-79330) and the Company's amended and
restated by-laws filed as Exhibit 3.2 to the Company's Registration Statement on
Form S-1 (No. 33-79330).
The Company maintains director and officers liability insurance for the
benefit of its directors and officers.
<TABLE>
ITEM 16. EXHIBITS.
<C> <S>
5.1 Opinion of Testa, Hurwitz & Thibeault, LLP
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Testa, Hurwitz & Thibeault, LLP (included in Exhibit 5.1)
24.1 Power of Attorney (see page II-4)
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
II-1
<PAGE> 16
(ii) to reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high and of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
20 percent change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
registration statement; and
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in this Registration
Statement.
(2) That, for the purpose of determining any liability under the Securities Act
of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities 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.
The registrant hereby undertakes that, for purposes of determining any liability
under the Securities Act of 1933, each filing of the registrant's annual report
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and,
where appropriate, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions or otherwise, the registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 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 of 1933 and will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in
II-2
<PAGE> 17
reliance upon Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities
Act shall be deemed to be part of this registration statement as of the
time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, 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-3
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Westford, Massachusetts on June 17, 1996.
CASCADE COMMUNICATIONS CORP.
By: /s/ Daniel E. Smith
-------------------------------------
Daniel E. Smith,
President and Chief Executive Officer
POWER OF ATTORNEY AND SIGNATURES
We, the undersigned officers and directors of Cascade Communications Corp.,
hereby severally constitute and appoint Daniel E. Smith and Paul E. Blondin, and
each of them singly, our true and lawful attorneys, with full power to them and
each of them singly, to sign for us in our names in the capacities indicated
below, all pre-effective and post-effective amendments to this registration
statement, and generally do all things in our names and on our behalf in such
capacities to enable Cascade Communications Corp. to comply with the provisions
of the Securities Act of 1933 and all requirements of the Securities and
Exchange Commission.
<TABLE>
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed below by the following persons in the capacities and
on the dates indicated.
<CAPTION>
Signature Title(s) Date
- --------- -------- ----
<S> <C> <C>
- --------------------------------- Chairperson of the Board June __, 1996
Victoria A. Brown
/s/ Daniel E. Smith
- --------------------------------- President, Chief Executive Officer and Director June 17, 1996
Daniel E. Smith (Principal Executive Officer)
/s/ Gururaj Deshpande
- --------------------------------- Executive Vice President of Marketing and June 17, 1996
Gururaj Deshpande Customer Service and Director
/s/ Paul E. Blondin
- --------------------------------- Vice President of Finance and Administration, June 17, 1996
Paul E. Blondin Chief Financial Officer, Treasurer and Secretary
(Principal Financial and Accounting Officer)
- --------------------------------- Director June __, 1996
Richard M. Burnes, Jr.
/s/ Paul J. Ferri
- --------------------------------- Director June 17, 1996
Paul J. Ferri
/s/ Bruns H. Grayson
- --------------------------------- Director June 17, 1996
Bruns H. Grayson
- --------------------------------- Director June __, 1996
Steven C. Walske
</TABLE>
II-4
<PAGE> 19
<TABLE>
EXHIBIT INDEX
<CAPTION>
Exhibit No. Description of Exhibit
----------- ----------------------
<C> <S>
5.1 Opinion of Testa, Hurwitz & Thibeault, LLP
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Testa, Hurwitz & Thibeault, LLP (included in Exhibit 5.1)
24.1 Power of Attorney (see page II-4)
</TABLE>
II-5
<PAGE> 1
EXHIBIT 5.1
June 14, 1996
Cascade Communications Corp.
5 Carlisle Road
Westford, Massachusetts 01886-3601
Re: S-3 Registration Statement
--------------------------
Ladies and Gentlemen:
We are counsel to Cascade Communications Corp., a Delaware corporation (the
"Company"), and have represented the Company in connection with the preparation
and filing of the Company's Form S-3 Registration Statement (the "Registration
Statement"), covering the sale to the public of up to 3,176,566 shares of the
Company's Common Stock, $.001 par value per share (the "Shares"), being sold by
certain stockholders of the Company.
We have reviewed the corporate proceedings taken by the Board of Directors
of the Company with respect to the authorization and issuance of the Shares. We
have also examined and relied upon originals or copies, certified or otherwise
authenticated to our satisfaction, of all corporate records, documents,
agreements or other instruments of the Company and have made all investigations
of law and have discussed with the Company's officers all questions of fact that
we have deemed necessary or appropriate.
Based upon and subject to the foregoing, we are of the opinion that the
Shares are legally issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and to the reference to our firm in the Prospectus
contained in the Registration Statement under the caption "Legal Matters."
Very truly yours,
TESTA, HURWITZ & THIBEAULT, LLP
<PAGE> 1
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement of
Cascade Communications Corp. on Form S-3 of our report dated February 1, 1996,
on our audits of the consolidated financial statements and financial statement
schedule of Cascade Communication Corp. as of December 31, 1995 and 1994, and
for each of the three years in the period ended December 31, 1995 which report
is included in the Cascade Communications Corp. 1995 Annual Report on Form 10K.
We also consent to the reference to our firm under the caption "Experts."
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
June 14, 1996
