Filed Pursuant to Rule 424 (b) (3)
Registration No. 333-70351
Uniphase Corporation
729,510 SHARES OF COMMON STOCK
The 729,510 shares of the Uniphase common stock offered hereby are held
by certain Uniphase stockholders. Uniphase will not receive any of the
proceeds from any sale of these shares, but has agreed to bear the
expenses of registration of the shares by this prospectus.
Nasdaq National Market symbol:
UNPH
The last sale price of the common stock on the Nasdaq National Market on
June 1, 1999 was $134.625 per share.
-------------------------------
THE SHARES REGISTERED HEREBY INVOLVE A HIGH LEVEL OF INVESTMENT RISK. YOU SHOULD
INVEST ONLY IF YOU CAN AFFORD A COMPLETE LOSS. SEE "RISK FACTORS" BEGINNING ON
PAGE 4 OF THIS PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
-------------------------------
June 3, 1999
TABLE OF CONTENTS
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PAGE
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Where You May Find More Information....................................2
The Company............................................................2
Recent Events..........................................................4
Risk Factors...........................................................5
Use of Proceeds.......................................................16
Selling Stockholders..................................................16
Plan of Distribution..................................................17
Incorporation of Certain Documents by Reference.......................17
Experts...............................................................18
Legal Matters.........................................................18
</TABLE>
UNIPHASE
Uniphase Corporation designs, develops, manufactures and markets laser
subsystems and components and modules for fiber optic telecommunications
and cable television systems and laser subsystems.
Our principal telecommunications products consist of source lasers,
modulators, pump lasers and transmitters modules. These products are
used in today's advanced fiber optic telecommunications networks to
provide the initial light signal, to encode the signal and to amplify
the signal over the long distances over which these networks are
deployed. Our laser subsystems are designed for a number of
applications and are purchased by our customers for inclusion into
equipment for biotechnology, industrial process control and measurement,
graphics and printing, and semiconductor inspection equipment and other
applications.
Our initial products consisted of laser subsystems. These industrial
lasers are used as a light source within various types of equipment
manufactured by our customers. We entered the telecommunications
markets in 1995 when we acquired United Technologies Photonics, then a
wholly owned subsidiary of United Technologies Research Center located
in Hartford, Connecticut. Since that acquisition, our strategy has been
to broaden our offering of telecommunications components and modules
through further acquisitions and internal growth. We currently operate
the following subsidiaries or divisions offering products for the
telecommunications industry:
<TABLE>
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Division Location Products
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<S> <S> <S>
Uniphase Netherlands Netherlands Source lasers for telecommunications,
cable television and multimedia;
external modulators; pump lasers;
semiconductor optical amplifiers
Uniphase Telecommunications Connecticut External modulators and wave length
Products lockers
Uniphase Laser Enterprise Switzerland Pump lasers for optical amplifiers
Transmission Systems Pennsylvania Cable television transmitters and
Division amplifiers
Uniphase Broadband Florida Instrumentation, transmitters and
Products receivers for telecommunications
Uniphase Fiber Components Australia Fiber-Bragg gratings
Uniphase Network Components California Grating-based network modules
Uniphase Fiberoptics United Kingdom Laser packaging for data and
telecommunications
Chassis Massachusetts Component packaging
</TABLE>
Uniphase's principal executive offices are located at 163 Baypointe Parkway,
San Jose, California 95134 and its telephone number is (408) 434-1800.
RECENT EVENTS
Merger With JDS FITEL Inc.
On January 28, 1999, we agreed to merge with JDS FITEL, Inc. (Toronto: JDS)
in a merger of equals. The combined company would have a total market value
of US $6.1 billion based on the January 27, 1999 closing prices of each
company's stock. After the merger, the combined company will be named
JDS Uniphase Corporation.
Under the terms of the agreement, JDS FITEL shareholders resident in Canada
will be entitled to receive 0.50855 shares of exchangeable stock of JDS
Uniphase Canada, a wholly owned subsidiary of Uniphase, or, at their option,
0.50855 shares of Uniphase, for each JDS FITEL share they hold. The
exchangeable shares are the economic and voting equivalent of our common stock
and will be exchangeable for shares of our common stock on a one-for-one basis
at any time. The current shareholders of JDS FITEL and our current
stockholders will each own approximately 50 percent of the combined company
following the merger. The structure of the transaction is expected to provide
the opportunity for a tax-free exchange for Canadian holders of JDS FITEL
stock. The completion of the merger is conditioned upon regulatory approvals,
as well as approvals by our stockholders and JDS FITEL's shareholders.
JDS Uniphase Corporation will be quoted on the Nasdaq National Market and will
report its financial results in U.S. dollars.
JDS Uniphase will be led by an integrated executive team from both companies;
Kevin Kalkhoven from Uniphase will be Co-chairman and Chief Executive Officer.
Jozef Straus from JDS FITEL will become Co-chairman, President and Chief
Operating Officer. Both companies will each nominate one half of the board.
RISK FACTORS
Our Stock Price Could Fluctuate Substantially
The Unpredictability of our Quarterly Operating Results Could Cause
our Stock Price to be Volatile or Decline.
We have experienced and expect to continue to experience significant
fluctuations in our quarterly results, which has caused and may in the
future cause substantial fluctuations in the market price of our
common stock. All of the concerns we discuss under Risk Factors could
affect our operating results, including, among others
- the timing of the receipt of product orders from a limited number of
major customers,
- the loss of one or more of our major suppliers,
- competitive pricing pressures,
- the costs associated with the acquisition or disposition of
businesses,
- our ability to design, manufacture and ship technically
advanced products with satisfactory yields on a timely
and cost-effective basis,
- the announcement and introduction of new products by us, and
- expenses associated with any intellectual property litigation.
In addition to concerns potentially affecting our operating results
addressed elsewhere under Risk Factors, the following factors may
also influence our operating results:
- our product mix
- the relative proportions of our domestic and international sales,
- the timing differences between when we incur expenses to increase
our marketing and sales capabilities and when we realize benefits,
if any, from such expenditures,
Furthermore, our sales often reflect orders shipped in the same quarter that
they are received, which could impact our revenue recognition in subsequent
quarters. Also, customers may cancel or reschedule shipments, and
production difficulties could delay shipments. In addition, we sell our
telecommunications equipment products to Original Equipment Manufacturers
who typically order in large quantities and therefore the timing of
such sales may significantly affect our quarterly results. An OEM supplies
system level network products to telecommunications carriers and others and
incorporates our components in these system level products. The timing of such
OEM sales can be affected by factors beyond our control, such as demand for
the OEMs' products and manufacturing risks experienced by OEMs. In this
regard, we have experienced rescheduling of orders by customers in each of our
markets and may experience similar rescheduling in the future. As a result of
all of these factors, our results from operations may vary significantly from
quarter to quarter.
In addition to the effect of ongoing operations on quarterly results,
acquisitions or dispositions of businesses, products or technologies by us
have resulted in and may in the future result in reorganization of our
operations, substantial charges or other expenses which have caused and may in
the future cause fluctuations in our quarterly operating results and cash
flows. For example, in the second and fourth quarters of fiscal 1998, we
incurred charges of $6.6 million and $33.7 million, respectively for acquired
in-process research and development in connection with the acquisition of
Uniphase Fiber Components and Uniphase Netherlands. In the third quarter of
fiscal 1997, we incurred charges of $33.3 million for acquired in-process
research and development in connection with the acquisition of Uniphase Laser
Enterprise. In addition, we incurred other charges in connection with
acquisitions completed in fiscal 1999, 1998 and 1997.
Finally, our net revenues and operating results in future quarters may be
below the expectations of public market securities analysts and investors.
In such event, the price of our common stock would likely decline,
perhaps substantially.
Factors Other Than Our Quarterly Results Could Cause Our Stock Price
to be Volatile or Decline
The market price of our common stock has been and is likely to continue to be
highly volatile due to causes other than our historical quarterly results,
such as
- announcements of technological innovations or new products or
our competitors,
- developments with respect to patents or proprietary rights,
- governmental regulatory action, and
- general market conditions.
In addition, the stock market has from time to time experienced
significant price and volume fluctuations that are unrelated to the operating
performance of particular companies.
We are Subject to Manufacturing Difficulties
If We Do Not Achieve Acceptable Manufacturing Yields or Sufficient
Product Reliability Our Operating Results Could Suffer
The manufacture of our products involves highly complex and precise processes,
requiring production in highly controlled and clean environments. Changes in
our manufacturing processes or those of our suppliers or their inadvertent use
of defective or contaminated materials could significantly reduce our
manufacturing yields and product reliability. Because the majority of our
manufacturing costs are relatively fixed, manufacturing yields are critical to
our results of operations. Certain divisions of Uniphase, including Uniphase
Laser Enterprise and Uniphase Netherlands, have in the past experienced lower
than expected production yields, which could delay product shipments and
impair gross margins. These divisions or any of our other manufacturing
facilities may not maintain acceptable yields in the future. To the extent we
do not achieve acceptable manufacturing yields or experience product shipment
delays, our business, operating results and financial condition would be
materially and adversely affected.
During the fourth quarter of fiscal 1998, we commenced construction of a new
laser fabrication facility in the Netherlands for Uniphase Netherlands, which
we acquired in June 1998. Our Uniphase Netherlands facility has not achieved
acceptable manufacturing yields since the June 1998 acquisition, and there is
continuing risk attendant to this new facility and its manufacturing yields
and costs. Uniphase Netherlands may not successfully manufacture laser
products in the future at yield or cost levels necessary to meet our
customers' needs, if at all. In addition, Uniphase Fiber Components is
establishing a production facility in Sydney, Australia for fiber Bragg
grating products. This facility may not manufacture grating products to
customers' specifications at the cost and yield levels required. To the extent
we do not achieve acceptable manufacturing yields or experience product
shipment delays, our business, operating results and financial condition
would be materially and adversely affected.
If Our Customers Do Not Qualify Our Manufacturing Lines For Volume
Shipments Our Operating Results Could Suffer.
Customers will not purchase any products (other than limited numbers of
evaluation units) prior to qualification of the manufacturing line for the
product. Each new manufacturing line must go through varying levels of
qualification with our customers. This qualification process determines
whether the manufacturing line achieves the customers' minimum quality,
performance and reliability standards. Delays in qualification can cause a
product to be dropped from a long-term supply program and result in
significant lost revenue opportunity over the term of that program. As noted in
the previous paragraph, we are currently completing new manufacturing
facilities in the Netherlands and Australia. We may experience delays in
obtaining customer qualification of these facilities. If we fail in the timely
qualification of these or other new manufacturing lines, our operating results
and customer relationships would be adversely affected.
Difficulties We May Encounter Managing Our Growth Could Adversely Affect Our
Results of Operations
We have historically achieved our growth through a combination of
acquisitions and internally developed new products. As part of our
strategy to sustain growth, we expect to continue to pursue acquisitions
of other companies, technologies and complementary product lines. We
also expect to continue developing new solid state lasers, components
and other products for OEM customers and attempt to further penetrate
the telecommunications and CATV markets through these new products.
Both strategies include risks. The success of each acquisition will
depend upon
- our ability to manufacture and sell the products of the businesses
acquired,
- continued demand for these products by our customers,
- our ability to integrate the acquired business' operations,
products and personnel,
- our ability to retain key personnel of the acquired businesses, and
- our ability to expand our financial and management controls and
reporting systems and procedures.
In March 1997, we acquired Uniphase Laser Enterprise, which produces our
980-nm pump laser products. In June 1998, we acquired Uniphase Netherlands. In
the case of both acquisitions, we acquired businesses that had previously been
engaged primarily in research and development and that needed to make the
transition from a research activity to a commercial business with sales and
profit levels that are consistent with our overall financial goals. This
transition has not yet been completed at Uniphase Netherlands, which continues
to operate at higher expense levels and lower gross margins than those
required to meet our profitability goals. In addition, in August 1998, we
acquired certain assets of Chassis, and in November 1998 acquired Uniphase
Broadband. In January 1999, we entered into an agreement to combine with JDS
FITEL Inc. See "Recent Developments." We may not successfully manufacture
and sell our products or successfully manage our growth, and failure to do so
could have a material adverse effect on our business, financial condition and
operating results.
Since 1997, when we acquired Uniphase Laser Enterprise, we have increased our
marketing, customer support and administrative functions to support an
increased level of operations primarily from our telecommunications products.
We may not be successful in creating this infrastructure nor may we realize
any increase in the level of our sales and operations through our new
products. We commenced operations at Uniphase Telecommunications in 1996 to
penetrate the CATV markets, and at Uniphase Network Components in 1998 to
develop and market a line of complementary optical components for our
telecommunications customers. In each case, we hired development,
manufacturing and other staff in anticipation of developing and selling new
products. Our operations may not achieve levels sufficient to justify the
increased expense levels associated with these new businesses.
Our Sales Would Suffer if One or More of Our Key Customers Substantially
Reduced Orders of Our Products
Our customer base is highly concentrated. Historically, orders from a
relatively limited number of OEM customers accounted for a substantial portion
of our net sales from telecommunications products. We expect that, for the
foreseeable future, sales to a limited number of customers will continue to
account for a high percentage of our net sales. Sales to any single customer
may vary significantly from quarter to quarter. If current customers do not
continue to place orders we may not be able to replace these orders with new
orders from new customers. In the telecommunications markets, our customers
evaluate our products and competitive products for deployment in large
telecommunications systems that they are installing. Our failure to be
selected by a customer for particular system projects can significantly impact
our business, operating results and financial condition. Similarly, even if
our customers select us, if our customers are not selected as the primary
supplier for an overall system installation, we can be similarly adversely
affected. Such fluctuations could have a material adverse effect on our
business, operating results and financial condition.
One telecommunications customer, CIENA Corporation, accounted for
approximately 12% of our net sales for fiscal 1998. One laser subsystems
customer, the Applied Biosystems Division of Perkin-Elmer Corporation,
accounted for approximately 10% and 12% of our net sales for fiscal 1997 and
1996, respectively. One additional customer, KLA- Tencor Corporation,
purchased both Laser subsystems and Ultrapointe systems and accounted for 12%
and 13% of our consolidated net sales in fiscal 1998 and 1996, respectively.
The Ultrapointe product line was sold to KLA-Tencor Corporation in December
1998 and will not be a source of future sales. No other customers represented
10% or more of total sales during fiscal 1998. The loss or delay of orders
from these or other OEM customers could have a materially adverse effect on
our business, financial condition and operating results.
Interruptions Affecting Our Key Suppliers Could Disrupt Production and
Compromise Our Product Quality And Adversely Affect Our Sales
We have sole or limited numbers of suppliers for certain of our products. We
currently obtain various components included in the manufacture of our
products from single or limited source suppliers. A disruption or loss of
supplies from these companies or a price increase for these components would
have a material adverse effect on our results of operations, product quality
and customer relationships. We currently utilize a sole source for the
crystal semiconductor chip sets incorporated in our solid state microlaser
products and acquire our pump diodes for use in its solid state laser products
from Opto Power Corporation and GEC. We also obtain lithium niobate wafers,
gallium arsenide wafers, specialized fiber components and certain lasers used
in its telecommunications products primarily from Crystal Technology, Inc.,
Fujikura, Ltd., Philips Key Modules, and Sumitomo, respectively. We do not
have long-term or volume purchase agreements with any of these suppliers, and
these components may not in the future be available in the quantities required
by us, if at all.
Any Faulure to Remain Competitive in Our Industry Would Impair Our Operating
Results
If Our Business Operations are Insufficient to Remain Competitive in Our
Industry Our Operating Results Could Suffer
The telecommunications and laser subsystems markets in which we sell our
products are highly competitive. In each of the markets we serve, we face
intense competition from established competitors. Many of these competitors
have substantially greater financial, engineering, manufacturing, marketing,
service and support resources than do we and may have substantially greater
name recognition, manufacturing expertise and capability and longer standing
customer relationships than do we. To remain competitive, we believe we must
maintain a substantial investment in research and development, marketing, and
customer service and support. We may not compete successfully in the laser or
telecommunications industries in the future, and we may not have sufficient
resources to continue to make such investments, or we may not make the
technological advances necessary to maintain our competitive position so that
our products will receive market acceptance. In addition, technological
changes or development efforts by our competitors may render our products or
technologies obsolete or uncompetitive.
If We Fail to Successfully Develop and Market Solid State Lasers to
Replace the Declining Markets for Our Gas Lasers, Our Operating Results
Could Suffer
The market for gas lasers is mature and expected to decline as customers
replace conventional lasers, including gas lasers, with solid state lasers.
Gas laser subsystems sales accounted for 26.3%, 37.3% and 52.9% of our net
sales for the fiscal years ended 1998, 1997 and 1996, respectively. Solid
state lasers are currently expected to be the primary commercial laser
technology in the future. Consequently, we have devoted substantial
resources to developing and commercializing our solid state laser products.
We believe that some companies are further advanced than us in solid state
laser development and are competing with us for many of the same
opportunities. To be competitive in our laser markets, we believe continued
manufacturing cost reductions and enhanced performance of our laser products
will be required on a continuing basis as these markets further mature.
However, our solid state laser products may not be competitive with products
of other companies as to cost or performance in the future.
If We Fail to Attract and Retain Key Personnel Our Business Could Suffer
Our future depends, in part, on our ability to attract and retain certain key
personnel. In particular, our research and development efforts depend on
hiring and retaining qualified engineers. Competition for highly skilled
engineers is extremely intense, and we are currently experiencing difficulty
in identifying and hiring certain qualified engineers in many areas of our
business. We may not be able to hire and retain such personnel at
compensation levels consistent with our existing compensation and salary
structure. Our future also depends on the continued contributions of our
executive officers and other key management and technical personnel, none of
whom currently has an employment agreement with us and each of whom would be
difficult to replace. We do not maintain a key person life insurance policy
on the Chief Executive Officer. However, the loss of the services of one or
more of our executive officers or key personnel or the inability to continue
to attract qualified personnel could delay product development cycles or
otherwise have a material adverse effect on our business, financial condition
and operating results.
Our Participation In International Markets Creates Risks to Our Business Not
Faced by Companies That Sell Their Products in the United States
International sales are subject to inherent risks, including
- unexpected changes in regulatory requirements,
- tariffs and other trade barriers,
- political and economic instability in foreign markets,
- difficulties in staffing and management,
- integration of foreign operations,
- longer payment cycles,
- greater difficulty in accounts receivable collection,
- currency fluctuations, and
- potentially adverse tax consequences.
International sales accounted for approximately 38.7%, 30.6% and 25.1% of net
sales in fiscal years 1998, 1997 and 1996, respectively. We expect that
international sales will continue to account for a significant portion of our
net sales. We may continue to expand our operations outside of the United
States and to enter additional international markets, both of which will
require significant management attention and financial resources.
Since a significant portion of our foreign sales are denominated in U.S.
dollars, our products may also become less price competitive in countries in
which local currencies decline in value relative to the U.S. dollar. Our
business and operating results may also be materially and adversely affected
by lower sales levels which typically occur during the summer months in
Europe and certain other overseas markets. Furthermore, the sales of many of
our OEM customers depends on international sales and, consequently, this
further exposes us to the risks associated with such international sales.
The Year 2000 Problem May Disrupt Ours and Our Customers' and Suppliers'
Businesses
We are aware of the risks associated with the operation of information
technology and non-information technology systems as the millennium (year
2000) approaches. The problem is pervasive and complex, and may affect many
information technology and non-information technology systems. The Year 2000
problem results from the rollover of the two digit year value from "99" to
"00". Systems that do not properly recognize such date- sensitive information
could generate erroneous data or fail. In addition to our own systems we rely
on external systems of our customers, suppliers, creditors, financial
organizations, utilities providers and government entities, both domestic and
international (which we collectively refer to as "Third Parties").
Consequently, we could be affected by disruptions in the operations of Third
Parties with which we interact. Furthermore, as customers expend resources to
correct their own systems, they may reduce their purchasing frequency and
volume of our products.
We are using both internal and external resources to assess
- Our state of readiness (including the readiness of
Third Parties, with which we interact) concerning the Year
2000 problem,
- our costs to correct material Year 2000 problems related to
our internal information technology and non-information
technology systems,
- the known risks related to any failure to correct any Year
2000 problems we identify, and
- the contingency plan, if any, that we should adopt should any
identified Year 2000 problems not be corrected.
To date, we have incurred less than $1.0 million in upgrades to our information
technology and non-information technoloty systems to make such systems Year
2000 compliant. We continue to evaluate the estimated costs associated with
the efforts to prepare for Year 2000 based on actual experience. While the
efforts will involve additional costs, we believe, based on (i) available
information, (ii) amounts spent to date, and (iii) the fact that our
information technology and non-information technology systems depend on third
party software, which we believe has been updated to address the Year 2000
problem, that we will manage our total Year 2000 transition without any
material adverse effect on our business operations, financial condition,
products or financial prospects. The actual outcomes and results could be
affected by future factors including, but not limited to,
- the continued availability of skilled personnel,
- cost control,
- the ability to locate and remediate software code problems,
- critical suppliers and subcontractors meeting their Year 2000
compliance commitments, and
- timely actions by customers.
We are working with our software system suppliers and believe that certain of
these systems are currently not Year 2000 compliant. We have targeted September
30, 1999 as the date by which these systems will be Year 2000 compliant. In
any event, we anticipate that such systems will be corrected for the Year 2000
problem prior to December 31, 1999. We are working with those Third Parties
to identify any Year 2000 problems affecting such Third Parties that could
have a material adverse affect on our business, financial condition or results
of operations. However, it would be impracticable for us to attempt to address
all potential Year 2000 problems of Third Parties that have been or may in the
future be identified. Specifically, Year 2000 problems have arisen or may
arise regarding the information technology and non-information technology
systems of Third Parties having widespread national and international
interactions with persons and entities generally (for example, certain
information technology and non-information technology systems of governmental
agencies, utilities and information and financial networks) that, if
uncorrected, could have a material adverse impact on our business, financial
condition or results of operations. We are still assessing the effect the Year
2000 problem will have on our suppliers and, at this time, cannot determine
such impact. However, we have identified alternative suppliers and, in the
event that any significant supplier suffers unresolved material Year 2000
problems, we believe that Uniphase would only experience short-term disruptions
in supply, not exceeding 90 days, while such supplier is replaced.
If We Have Insufficient Proprietary Rights or We Failed to Protect Those We
Have Our Business Would be Materially Impaired
We May Not Obtain the Intellectual Property Rights We Require
The laser, semiconductor capital equipment, and telecommunications markets in
which we sell our products experience frequent litigation regarding patent and
other intellectual property rights. Numerous patents in these industries are
held by others, including academic institutions and our competitors. In the
past we have acquired and in the future we may seek to acquire license rights
to these or other patents or other intellectual property to the extent
necessary for our business. Unless we are able to obtain such licenses on
commercially reasonable terms, patents or other intellectual property held by
others could inhibit our development of new products for our markets. While
in the past licenses generally have been available to us where third-party
technology was necessary or useful for the development or production of our
products, in the future licenses to third-party technology may not be
available on commercially reasonable terms, if at all. Generally, a license,
if granted, includes payments by us of up-front fees, ongoing royalties or a
combination thereof. Such royalty or other terms could have a significant
adverse impact on our operating results. We are a licensee of a number of
third party technologies and intellectual property rights and are required to
pay royalties to these third party licensors on certain of our
telecommunications products and solid state lasers. During fiscal 1998, 1997
and 1996, we expensed $2.0 million, $1.4 million and $1.3 million,
respectively, in license and royalty fees primarily in connection with our gas
laser subsystems.
Our Products May Infringe the Property Rights of Others
The industry in which we operate experiences periodic claims of patent
infringement or other intellectual property rights. In this regard, third
parties may in the future assert claims against us concerning our existing
products or with respect to future products under development by us. Any
litigation to determine the validity of any third-party claims could result in
significant expense to us and divert the efforts of our technical and
management personnel, whether or not we are successful in such litigation. If
we are unsuccessful in any such litigation, we could be required to expend
significant resources to develop non- infringing technology or to obtain
licenses to the technology that is the subject of the litigation. We may
not be successful in such development or such licenses may not be available
to us. Without such a license, we could be enjoined from future sales of the
infringing product or products.
Our Intellectual Property Rights May Not Be Adequately Protected
Our future depends in part upon our intellectual property, including trade
secrets, know-how and continuing technological innovation. We currently hold
95 U.S. patents on products or processes and certain corresponding foreign
patents and have applications for certain patents currently pending. The
steps taken by us to protect our intellectual property may not adequately
prevent misappropriation or that others will not develop competitive
technologies or products. Other companies may be investigating or developing
other technologies that are similar to ours. It is possible that patents may
not be issued from any application pending or filed by us and, if patents do
issue, the claims allowed may not be sufficiently broad to deter or prohibit
others from marketing similar products. Any patents issued to us may be
challenged, invalidated or circumvented. Further, the rights under our
patents may not provide a competitive advantage to us. In addition, the laws
of certain territories in which our products are or may be developed,
manufactured or sold, including Asia, Europe or Latin America, may not protect
our products and intellectual property rights to the same extent as the laws
of the United States.
If We Fail to Successfully Manage Our Exposure to the Worldwide Financial
Markets Our Operating Results Could Suffer
We experience financial market risks, including changes in interest rates,
foreign currency exchange rates and marketable equity security prices. We
utilize derivative financial instruments to mitigate these risks. We do not
use derivative financial instruments for speculative or trading purposes. The
primary objective of our investment activities is to preserve principal while
at the same time maximizing yields without significantly increasing risk. To
achieve this objective, a majority of our marketable investments are floating
rate and municipal bonds, auction instruments and money market instruments
denominated in U.S. dollars. We hedge currency risks of investments
denominated in foreign currencies with forward currency contracts. Gains and
losses on these foreign currency investments are generally offset by
corresponding gains and losses on the related hedging instruments, resulting
in negligible net exposure to us. A substantial portion of our revenue,
expense and capital purchasing activities are transacted in U.S. dollars.
However, we do enter into these transactions in other currencies, primarily
European currencies. To protect against reductions in value and the
volatility of future cash flows caused by changes in foreign exchange rates,
we have established hedging programs. Currency forward contracts are utilized
in these hedging programs. Our hedging programs reduce, but do not always
entirely eliminate the impact of foreign currency exchange rate movements.
Actual results on our financial position may differ materially.
If We Fail to Obtain Additional Capital at the Times, in the Amounts and Upon
the Terms Required, Our Business Could Suffer
We are devoting substantial resources for new facilities and equipment for the
production of source lasers, fiber-Bragg gratings and modules used in
telecommunications and for the development of new solid state lasers.
Although we believe existing cash balances, cash flow from operations and
available lines of credit, will be sufficient to meet our capital requirements
at least through the end of fiscal 1999, we may be required to seek additional
equity or debt financing to compete effectively in these markets. We cannot
precisely determine the timing and amount of such capital requirements and
will depend on several factors, including our acquisitions and the demand for
our products and products under development. Such additional financing may
not available when needed, or, if available, may not on terms satisfactory to
us.
Our Currently Outstanding Preferred Stock and Our Ability to Issue
Additional Preferred Stock Could Impair The Rights of Our Common Stockholders
Our Board of Directors has the authority to issue up to 800,000 shares
of undesignated preferred stock and to determine the powers, preferences
and rights and the qualifications, limitations or restrictions granted
to or imposed upon any wholly unissued shares of undesignated preferred
stock and to fix the number of shares constituting any series and the
designation of such series, without the consent of our shareholders.
The preferred stock could be issued with voting, liquidation, dividend
and other rights superior to those of the holders of common stock. The
issuance of preferred stock under certain circumstances could have the
effect of delaying, deferring or preventing a change in control of
us. On June 11, 1998, the Board of Directors authorized and
declared a dividend distribution of one right for each outstanding share
of its common stock, to stockholders of record at the close of business
on July 6,1998, and authorized the issuance of one right with each share
of common stock issued (including shares distributed from treasury) by
us thereafter between the record date and the distribution date.
Each right entitles the registered holder, subject to the terms of the
Rights Agreement, to purchase from us one unit, equal to one one-thousandth
of a share of Series B Preferred Stock, at a purchase price of $270 per unit,
subject to adjustment, for each share of common stock held by the holder. The
purchase price is payable in cash or by certified or bank check or money order
payable to our order. The description and terms of the rights are set forth in
a Rights Agreement between us and American Stock Transfer & Trust Company, as
Rights Agent, dated as of June 22, 1998, as amended from time to time.
Certain provisions contained in the rights plan, may have the effect of
discouraging a third party from making an acquisition proposal for
us and may thereby inhibit a change in control of us. For
example, such provisions may deter tender offers for shares of Common
Stock which offers may be attractive to the stockholders, or deter
purchases of large blocks of Common Stock, thereby limiting the
opportunity for stockholders to receive a premium for their shares of
Common Stock over the then-prevailing market prices.
Certain Anti-Takeover Provisions Contained in Our Charter and under
Delaware Law Could Impair a Takeover Attempt
We are subject to the provisions of Section 203 of the Delaware
General Corporation Law prohibiting, under certain circumstances,
publicly-held Delaware corporations from engaging in business
combinations with certain stockholders for a specified period of time
without the approval of the holders of substantially all of its
outstanding voting stock. Such provisions could delay or impede the
removal of incumbent directors and could make more difficult a merger,
tender offer or proxy contest involving us, even if such events
could be beneficial, in the short term, to the interests of the
stockholders. In addition, such provisions could limit the price that
certain investors might be willing to pay in the future for shares of
our Common Stock. Our Certificate of Incorporation and Bylaws
contain provisions relating to the limitations of liability and
indemnification of its directors and officers, dividing our Board of
Directors into three classes of directors serving three-year terms and
providing that its stockholders can take action only at a duly called
annual or special meeting of stockholders. These provisions also may
have the effect of deterring hostile takeovers or delaying changes in
control or management of us.
This Prospectus Contains Certain Forward Looking Statements
Investors should carefully consider the risk factors discussed above in
evaluating an investment in the common stock offered by this prospectus.
The statements contained in this prospectus that are not purely
historical are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995 and Section 21E of the
Securities Exchange Act, including, without limitation, statements
regarding Uniphase's expectations, hopes, beliefs, anticipations,
commitments, intentions and strategies regarding the future. Actual
results could differ from those projected in any forward-looking
statements for the reasons, among others, detailed in the preceding
"Risk Factors." The fact that some of the risk factors described in this
prospectus may be the same or similar to those described in our past
filings means only that those risks are present in multiple periods. We
believe that many of the risks detailed here are part of doing business
in the industry in which we compete and will likely be present in all
periods reported. The fact that certain risks are endemic to the
industry does not lessen the significance of the risk. We have made
forward-looking statements as of the date of this prospectus and assume
no obligation to update them, or to update the reasons why actual
results could differ from those projected in them.
USE OF PROCEEDS
Uniphase will not receive any of the proceeds from the sale of the
shares offered by the selling stockholders, under this prospectus, but
has agreed to bear certain expenses of registration of the shares under
federal and state securities laws. This registration statement is
intended to satisfy certain of Uniphase's obligations under the
Broadband merger agreement.
SELLING STOCKHOLDERS
The following table provides the names of and the number of shares of common
stock beneficially owned by each selling stockholder, and the number of shares
of common stock beneficially owned by each selling stockholder upon completion
of the offering or offerings pursuant to this prospectus, assuming each
selling stockholder offers and sells all of its or his/her respective shares.
Selling stockholders may, however, offer and sell all, or some or none of
their shares. The respective donees, pledgees and transferees or other
successors in interest of the selling stockholders may also sell the shares
listed below as being held by the selling stockholders. No selling
stockholder will beneficially own one percent or greater of Uniphase's
outstanding common stock upon the sale of their shares offered hereby. Each
of the ownership percentages in the second column of the following table was
calculated based on the 40,455,627 Uniphase voting shares outstanding as of
May 11,1999.
<TABLE>
<CAPTION>
Beneficial Percentage Beneficial
Ownership Prior to Ownership
Prior to The After
Offering Offering Offered The Offering
----------- --------- Number ------------
Number of of Number of
Shares % Shares Shares
- ------------------------------ ----------- --------- --------- ------------
<S> <C> <C> <C> <C>
James Breitmeier............... 213,515 * 213,515 0
Paul W. Casper................. 213,515 * 213,515 0
James W. Toy................... 133,515 * 133,515 0
The Six Pillar Foundation...... 80,000 * 80,000 0
Donald R. Alford............... 64,055 * 64,055 0
Whitworth W. Cotton............ 21,351 * 21,351 0
Marc E. Sawyer................. 2,847 * 2,847 0
Allen S. Henry................. 712 * 712 0
* Less than 1%
</TABLE>
PLAN OF DISTRIBUTION
This prospectus relates to the offer and sale from time to time by the
holders of up to 729,510 shares of common stock. The shares were issued
in connection with the acquisition in November 1998 of Broadband
Communications Products, Inc. by Uniphase. The selling shareholders are
the former shareholders of Broadband. This prospectus has been prepared
in connection with registering the shares to allow for sales of shares by the
selling stockholders to the public. Uniphase has registered the shares for
sale under this prospectus, but registration of the shares does not
necessarily mean that any of these shares will be offered and sold by the
selling stockholders.
Uniphase will not receive any proceeds from the offering by the selling
stockholders. The shares may be sold from time to time to purchasers, as
follows:
- directly by any of the selling stockholders, or donees, pledgees,
transferees or other successors in interest ("transferees") thereof,
or
- by the selling stockholders, or transferees, through dealers or
agents.
- Dealers or agents participating in any offering of the shares under
this prospectus may receive compensation in the form of commissions
from the selling stockholders, or transferees and/or the
purchasers of shares for whom they may act as agent. The selling
stockholders, or transferees, and any dealers or agents that
participate in the distribution of shares may be deemed to be
"underwriters" within the meaning of the Securities Act and any
profit on the sale of shares by them and any commissions received
by any such dealers or agents might be deemed to be underwriting
commissions under the Securities Act.
The selling stockholders may also offer their shares from time to time in
connection with (i) covering short sales of shares of common stock; (ii)
pledges to secure debts or other obligations; (iii) the writing or settlement
of non-traded and exchange-traded call options, or other hedge transactions;
and (iv) a combination of the above transactions.
At a time a particular offer of shares is made, a prospectus supplement,
if required, will be distributed that will set forth the name and names
of any dealers or agents and any commissions and other terms
constituting compensation from the selling stockholders, or transferees
thereof, and any other required information. The shares may be sold
from time to time at varying prices determined at the time of sale or at
negotiated prices.
In order to comply with the securities laws of certain states, if applicable,
the shares may be sold only through registered or licensed brokers or dealers.
In addition, in certain states, the shares may not be sold unless they have
been registered or qualified for sale in such state or an exemption from such
registration or qualification requirement is available and is complied with.
The shares may also be sold in one or more of the following transactions:
- block transactions (which may involve crosses) in which a broker-
dealer may sell all or a portion of such stock as agent but may
position and resell all or a portion of the block as principal
to facilitate the transaction;
- purchases by any such broker-dealer as principal and resale by such
broker-dealer for its own account pursuant to a prospectus
supplement;
- ordinary brokerage transactions and transactions in which any such
broker-dealer solicits purchasers;
- sales "at the market" to or through a market maker or into an
existing trading market, on an exchange or otherwise,
for such shares; and
- sales in other ways not involving market makers or established
trading markets, including direct sales to purchasers. In
effecting sales, broker-dealers engaged by the selling stockholders
may arrange for other broker-dealers to participate.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The documents listed below have been filed by Uniphase under the
Exchange Act with the Commission and are incorporated into this
prospectus by reference:
a. Uniphase's Annual Report on Form 10-K for the year ended
June 30, 1998;
b. Uniphase's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1998;
c. Uniphase's Quarterly Report on Form 10-Q/A for the quarter
ended September 30, 1998;
d. Uniphase's Quarterly Report on Form 10-Q for the quarter
ended December 31, 1998;
e. Uniphase's Quarterly Report on Form 10-Q/A for the quarter
ended December 31, 1998;
f. Uniphase's Report on Form 10-Q for the quarter ended March 31, 1999;
g. Uniphase's Report on Form 8-K/A dated as of August 24, 1998;
h. Uniphase's Report on Form 8-K/A dated as of August 25, 1998;
i. Uniphase's Report on Form 8-K dated as of January 7, 1999;
j. Uniphase's Report on Form 8-K/A dated as of April 28, 1999; and
k. Uniphase's definitive Proxy Statement on Form 14-A filed on
June 2, 1999;
l. The description of the Registrant's Common Stock contained
in Uniphase's Registration Statement on Form 8-A filed with
the Commission on November 15, 1993.
Each document filed by Uniphase pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act subsequent to the date of this prospectus
and prior to the termination of the offering made by this prospectus
shall be deemed to be incorporated by reference in this prospectus and
to be part of this prospectus from the filing date of such documents.
Any statement contained into this prospectus or in a document
incorporated or deemed to be incorporated by reference into this
prospectus shall be deemed to be modified or superseded for purposes of
this prospectus to the extent that a statement contained into this
prospectus (or in the applicable prospectus supplement) or in any other
subsequently filed document which also is or is deemed to be
incorporated by reference into this prospectus 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.
Copies of all documents which are incorporated into this prospectus by
reference (not including the exhibits to such documents, unless such
exhibits are specifically incorporated by reference in such documents)
will be provided without charge to each person, including any beneficial
owner, to whom this prospectus is delivered upon written or oral
request. Please direct requests to the Corporate Secretary at
Uniphase's corporate headquarters at 163 Baypointe Parkway, San Jose,
California 95134 or by telephone at (408) 434-1800.
EXPERTS
The consolidated financial statements of Uniphase Corporation appearing
in Uniphase Corporation's Current Report on Form 8-K/A dated April 28, 1999,
have been audited by Ernst & Young LLP, independent auditors, as set forth in
their report thereon included therein and incorporated herein by reference.
Such consolidated financial statements are incorporated herein by reference in
reliance upon such report given upon the authority of such firm as experts
in accounting and auditing.
The financial statements of Philips Optoelectronics, a Division of
Koninklijke Philips Electronics N.V. included in its Amendment No. 2 to
the Current Report on Form 8-K/A dated August 25, 1998, have been
audited by Ernst & Young Accountants, independent auditors, as set
forth in their report thereon included therein and incorporated herein
by reference. Such financial statements are incorporated herein by reference
in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
LEGAL MATTERS
The validity of the issuance of the shares of Common Stock offered
pursuant to this prospectus will be passed upon for Uniphase by Morrison
& Foerster LLP, Palo Alto, California.
Interests Of Named Experts
Michael C. Phillips, a partner with Morrison & Foerster LLP, counsel to
the Company, also serves as a Senior Vice President of Uniphase.
WHERE YOU MAY FIND MORE INFORMATION
Uniphase is subject to the informational requirements of the Securities
Exchange Act of 1934, and accordingly Uniphase files reports, proxy statements
and other information with the Securities and Exchange Commission. Such
reports, proxy statements and other information filed can be inspected and
copied at the Commission's Public Reference Section, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the following regional offices of the
Commission: Seven World Trade Center, 13th Floor, New York, New York
10048 and 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511.
Copies of such material can be obtained from the Public Reference Section of
the Commission, 450 Fifth Street, N.W., Washington, D.C.20549, at prescribed
rates. The Commission maintains a web site (http://www.sec.gov) containing
reports, proxy and information statements and other information of
registrants, including Uniphase, that file electronically with the
Commission. In addition, Uniphase's common stock is listed on the Nasdaq
National Market and similar information concerning Uniphase can be inspected
and copied at the offices of the National Association of Securities Dealers,
Inc., 9513 Key West Avenue, Rockville, Maryland 20850.
Uniphase has filed with the Commission a registration statement on Form S-3
(of which this prospectus is a part) under the Securities Act of 1933,
with respect to the shares offered by this prospectus. This prospectus does
not contain all of the information set forth in the registration statement,
certain portions of which have been omitted as permitted by the rules and
and regulations of the Commission. Statements contained in this prospectus
as to the contents of any contract or other documents are not necessarily
complete, and in each instance reference is made to the copy of such contract
or other document filed as an exhibit to the registration statement, each
such statement being qualified in all respects by such reference and the
exhibits and schedules thereto. For further information regarding Uniphase
and the shares offered by this prospectus, reference is hereby made to the
registration statement and such exhibits and schedules which may be obtained
from the Commission at its principal office in Washington, D.C. upon payment
of the fees prescribed by the Commission.
No person has been authorized to give any information or to make any
representations not contained or incorporated by reference in this prospectus,
in connection with the offer described in this prospectus and, if given or
made, such information and representations must not be relied upon as having
been authorized by Uniphase or the selling stockholders. Neither the delivery
of this prospectus nor any sale made under this prospectus shall under any
circumstances create any implication that there has been no change in the
affairs of Uniphase since the date of this prospectus or since the date of any
documents incorporated into this prospectus by reference. This prospectus does
not constitute an offer to sell or a solicitation of an offer to buy any
securities other than the securities to which it relates, or an offer or
solicitation in any state to any person to whom it is unlawful to make such
offer in such state.
