As Filed with the Securities and Exchange Commission on September 30, 1998
Registration No. 333-
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
APPLIED CELLULAR TECHNOLOGY, INC.
(Exact name of registrant as specified in its charter)
MISSOURI 43-1641533
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
400 Royal Palm Way, Suite 4
Palm Beach, Florida 33480
(561) 366-4800
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
Garrett A. Sullivan
400 Royal Palm Way, Suite 410
Palm Beach, Florida 33480
(561) 366-4800
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies of all correspondence to:
Denis P. McCusker, Esq.
Bryan Cave LLP
One Metropolitan Square
211 North Broadway, Suite 3600
St. Louis, Missouri 63102-2750
(314) 259-2000
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Approximate date of commencement of proposed sale to public: From time to
time 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, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration 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,
please check the following box. |_|
CALCULATION OF REGISTRATION FEE
<TABLE>
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<CAPTION>
Title of each class of Amount to be Proposed maximum Proposed maximum Amount of
securities to be registered registered offering price per aggregate offering registration fee
unit(1) price
===================================================================================================================
<S> <C> <C> <C> <C>
Common Stock, $.001 par
value per share 7,796,119 shares $2.50 $19,490,298 $5,750
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to Rule 457(b), the proposed offering price and registration fee
has been calculated on the basis of the average of the high and low trading
prices for the Common Stock on September 28, 1998 as reported on the Nasdaq
National Market.
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.
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<PAGE>
SUBJECT TO COMPLETION, DATED SEPTEMBER 30, 1998
PRELIMINARY PROSPECTUS
7,796,119 Shares
[GRAPHIC OMITTED]
Applied Cellular Technology
Common Stock
------------------
This Prospectus relates to the proposed sale from time to time of up to
7,796,119 shares (the "Shares") of the common stock, par value $.001 per share
(the "ACT Common Stock"), of Applied Cellular Technology, Inc., a Missouri
corporation ("ACT" or the "Company"), in the amount and in the manner and on
terms and conditions described herein, by the Selling Shareholders. See "Selling
Shareholders." The Selling Shareholders may sell the Shares in one or more
transactions (which may include "block transactions") on the Nasdaq National
Market, in the over-the-counter market, in negotiated transactions or in a
combination of such methods of sales, at fixed prices which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Shareholders may
effect such transactions by selling the Shares directly to purchasers, or may
sell to or through agents, dealers or underwriters designated from time to time,
and such agents, dealers or underwriters may receive compensation in the form of
discounts, concessions or commissions from the Selling Shareholders and/or the
purchaser(s) of Shares for whom they may act as agent or to whom they may sell
as principals, or both. The Selling Shareholders may also pledge certain of the
Shares from time to time, and this Prospectus also relates to any sale of Shares
that might take place following any foreclosure of such a pledge. The Selling
Shareholders and the brokers and dealers through which the sales of the Shares
may be made may be deemed to be "underwriters" within the meaning set forth in
the Securities Act of 1933, as amended (the "Securities Act"), and their
commissions and discounts and other compensation may be regarded as
underwriters' compensation. See "Plan of Distribution" and "Selling
Shareholders." The Company will not receive any proceeds from the sale of Shares
by the Selling Shareholders and will bear all the expenses incurred in
connection with registering this offering of the Shares.
The Shares have been or will be issued by the Company from time to time (a)
in various acquisition transactions, (b) in consideration for services rendered,
including services under employment agreements and employee bonuses, or (c) on
the exercise of warrants previously issued by the Company, all as described
herein. See "Selling Shareholders." The registration of the Shares has been
effected pursuant to agreements entered into by the Company with the Selling
Shareholders. Although such registration will allow the sale of the Shares by
the Selling Shareholders from time to time as described herein, the Company
believes that the Selling Shareholders do not currently intend to sell all or
substantially all of the Shares.
The ACT Common Stock of the Company is listed on the Nasdaq National Market
under the symbol "ACTC." On September 28, 1998, the last reported sale price of
the ACT Common Stock on the Nasdaq National Market was $2.50 per share. See
"Price Range of ACT Common Stock."
-------------------------
SEE "RISK FACTORS" BEGINNING ON PAGE 4 IN THE PROSPECTUS FOR A DISCUSSION
OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE
ACT COMMON STOCK OFFERED HEREBY.
--------------------------
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 _________, 1998.
<PAGE>
AVAILABLE INFORMATION
ACT 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"). These reports, proxy statements and
other information can be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the Commission's regional offices located at
Northeast Regional Office, Seven World Trade Center, Suite 1300, New York, New
York 10048 and Midwest Regional Office, Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. Copies of such materials can also
be obtained from the Public Reference Section of the Commission, Judiciary
Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The
Commission maintains a Web site that contains reports, proxy and information
statements and other materials that are filed through the Commission's
Electronic Data Analysis and Retrieval (EDGAR) System. This Web site can be
assessed at http://www.sec.gov. Quotations relating to the ACT Common Stock
appear on the Nasdaq National Market, and such reports, proxy statements and
other information concerning ACT can also be inspected at the offices of the
National Association of Securities Dealers, Inc., 1735 K Street, N.W.,
Washington, D.C. 20006.
ACT has filed with the Commission a Registration Statement on Form S-3 (the
"Registration Statement") under the Securities Act with respect to the shares of
ACT Common Stock offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement or the exhibits thereto. As
permitted by the rules and regulations of the Commission, this Prospectus omits
certain information contained or incorporated by reference in the Registration
Statement. Statements contained in this Prospectus as to the contents of any
contract or other document filed or incorporated by reference as an exhibit to
the Registration Statement 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. For further information, reference is
hereby made to the Registration Statement and exhibits thereto, copies of which
may be inspected at the offices of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 or obtained from the Commission at the same address at
prescribed rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed by the Company with the Commission
pursuant to the Exchange Act are incorporated herein by reference:
1. the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997 (filed with the Commission on March 30, 1998);
2. the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1998 (filed with the Commission on May 14, 1998);
3. the Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1998 (filed with the Commission on August 14, 1998):
4. the Company's Current Reports on Form 8-K and 8-K/A filed with the
commission on June 26, 1998, June 29, 1998 and September 23, 1998; and
5. the Company's Current Reports on Form 8-K and 8-K/A filed with the
commission on July 15, 1998, and September 23, 1998.
All documents filed by ACT with the Commission pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date hereof and prior
to the termination of the offering shall hereby be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such documents. Any statement contained herein or in a document incorporated or
deemed to be incorporated herein by reference 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 incorporated or
deemed to be incorporated herein by reference, which statement is also
incorporated herein by reference, 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.
2
<PAGE>
This Prospectus incorporates documents by reference which are not presented
herein or delivered herewith. Copies of these documents (excluding exhibits
unless such exhibits are specifically incorporated by reference into the
information incorporated herein) will be provided by first class mail without
charge to each person to whom this Prospectus is delivered, upon written or oral
request by such person to Applied Cellular Technology, Inc., James River
Professional Center, 1866 N. Deffer Drive, Nixa, Missouri 65714; Attention: Kay
Langsford, Corporate Controller (telephone: (417) 725-9888).
No person has been authorized in connection with this offering to give any
information or to make any representation not contained or incorporated by
reference in this Prospectus and, if given or made, such information or
representation must not be relied upon as having been authorized by ACT or any
other person. This Prospectus does not constitute an offer to sell, or a
solicitation of an offer to purchase, any securities other than those to which
it relates, nor does it constitute an offer to sell or a solicitation of an
offer to purchase by any person in any jurisdiction in which it is unlawful for
such person to make such an offer or solicitation. Neither the delivery of this
Prospectus nor any sale made hereunder shall, under any circumstances, create
any implication that the information contained herein is correct as of any time
subsequent to the date hereof or that there has been no change in the affairs of
ACT since such date.
-------------------------------------
TABLE OF CONTENTS
Available Information...............................2
Incorporation Of Certain Documents By Reference.....2
Risk Factors........................................4
The Company.........................................6
Selling Shareholders............................... 7
Description of ACT Capital Stock...................10
Plan of Distribution...............................11
Legal Matters......................................11
Experts............................................11
3
<PAGE>
RISK FACTORS
In addition to the other information contained herein, the following
factors should be considered carefully in evaluating the Company and its
business before purchasing any of the Common Stock
Uncertainty of Future Financial Results
While the Company has been profitable for the last three fiscal years,
future financial results are uncertain. There can be no assurance that the
Company will continue to be operated in a profitable manner. Profitability
depends upon many factors, including the success of the Company's various
marketing programs, the maintenance or reduction of expense levels and the
ability of the Company to successfully coordinate the efforts of the different
segments of its business.
Future Sales of and Market for the Shares
As of September 29, 1998, there were 32,531,616 shares of ACT Common Stock
outstanding. In addition, 4,367,986 shares of ACT Common Stock are reserved for
issuance in exchange for the exchangeable shares of ACT-GFX Canada, Inc. and the
exchangeable shares of Commstar, Ltd., both wholly owned subsidiaries of ACT.
Since January 1, 1998, the Company has issued an aggregate of 12,083,210 shares
of ACT Common Stock, of which 10,664,762 shares of ACT Common Stock were issued
in acquisitions, 850,000 shares of ACT Common Stock were issued upon the
exercise of warrants, 250,000 shares of ACT Common Stock were sold to certain
directors and an officer of the Company, and 318,448 shares of ACT Common Stock
were issued for services rendered, including services under employment
agreements and employee bonuses.
Management of the Company anticipates that the Company will continue to
effect acquisitions and contract for certain services primarily through the
issuance of ACT Common Stock or other equity securities of the Company. Such
issuances of additional securities may be viewed as being dilutive of the value
of the ACT Common Stock in certain circumstances and may have an adverse impact
on the market price of the ACT Common Stock.
Risks Associated with Acquisitions and Expansion
The Company has engaged in a continuing program of acquisitions of other
businesses which are considered to be complementary to the lines of business
carried on by the Company, and it is anticipated that such acquisitions will
continue to occur. As of June 30, 1998, the total assets of the Company were
approximately $113.6 million. As of March 31, 1998, the total assets of the
Company were approximately $73.1 million. As of December 31, 1997, the total
assets of the Company were approximately $61.3 million, compared to
approximately $33.2 million at December 31, 1996 and approximately $4.1 million
at the end of 1995. Net operating revenues for the year ended December 31, 1997
were approximately $103.2 million compared to approximately $19.9 million in
1996 and $2.3 million in 1995. Managing these dramatic changes in the scope of
the business of the Company will present ongoing challenges to management, and
there can be no assurance that the Company's operations as currently structured,
or as affected by future acquisitions, will be successful. The businesses
acquired by the Company may require substantial additional capital, and there
can be no assurance as to the availability of such capital when needed, nor as
to the terms on which such capital might be made available to the Company. It is
the Company's policy to retain existing management of acquired companies and to
allow the new subsidiary to continue to operate in the manner which has resulted
in its success in the past, under the overall supervision of senior management
of the Company. Accordingly, the success of the operations of these subsidiaries
will depend, to a great extent, on the continued efforts of the management of
the acquired companies.
Competition
Each segment of the Company's business is highly competitive, and it is
expected that competitive pressures will continue. Many of the Company's
competitors have far greater financial and other resources than the Company. The
areas which the Company has identified for continued growth and expansion are
also target market segments for some of the largest and most strongly
capitalized companies in the United States. There can be no assurance that the
Company will have the financial, technical, marketing and other resources
required to compete successfully in this environment in the future.
4
<PAGE>
Dependence on Key Individuals
The future success of the Company is highly dependent upon the Company's
ability to attract and retain qualified key employees. The Company is organized
with a small senior management team, with each of its separate operations under
the day-to-day control of local managers. If the Company were to lose the
services of any members of its central management team, the overall operations
of the Company could be adversely affected, and the operations of any of the
individual facilities of the Company could be adversely affected if the services
of the local managers should be unavailable.
Lack of Dividends on Common Stock; Issuance of Preferred Stock
The Company does not have a history of paying dividends on ACT Common
Stock, and there can be no assurance that such dividends will be paid in the
foreseeable future. The Company intends to use any earnings which may be
generated to finance the growth of the Company's businesses. The Board of
Directors has the right to authorize the issuance of preferred stock, without
further stockholder approval, the holders of which may have preferences as to
payment of dividends.
Potential Conflicts of Interests
Mr. Richard Sullivan, the Chief Executive Officer of the Company, is also
Chairman of Great Bay Technology, Inc. and Managing General Partner of the Bay
Group. Both these companies conduct business with the Company, and receive
compensation from the Company for various services, including assistance in
identifying potential acquisition candidates and in negotiating acquisition
transactions. The relationships among such companies, Mr. Sullivan and the
Company may involve conflicts of interest.
Possible Volatility of Stock Price
ACT Common Stock is quoted on the Nasdaq National Market, which stock
market has experienced and is likely to experience in the future significant
price and volume fluctuations which could adversely affect the market price of
ACT Common Stock without regard to the operating performance of the Company. In
addition, the Company believes that factors such as the significant changes to
the business of the Company resulting from continued acquisitions and
expansions, quarterly fluctuations in the financial results of the Company,
shortfalls in earnings or sales below analyst expectations, changes in the
performance of other companies in the same market sectors as the Company and the
performance of the overall economy and the financial markets could cause the
price of ACT Common Stock to fluctuate substantially. During the 12 months
preceding the date of this Prospectus, the price per share of ACT Common Stock
has ranged from a high of $9-3/4 to a low of $1 9/16.
Forward-Looking Statements and Associated Risk
This Prospectus, including the information incorporated herein by
reference, contains forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995, including statements regarding, among
other items, (a) the Company's growth strategies, (b) anticipated trends in the
Company's business and demographics and (c) the Company's ability to
successfully integrate the business operations of recently acquired companies.
These forward-looking statements are based largely on the Company's expectations
and are subject to a number of risks and uncertainties, certain of which are
beyond the Company's control. Actual results could differ materially from these
forward-looking statements as a result of the factors described in "Risk
Factors," including, among others, regulatory, competitive or other economic
influences. In light of these risks and uncertainties, there can be no assurance
that the forward-looking information contained in this Prospectus will be
accurate.
5
<PAGE>
THE COMPANY
ACT is a builder of infrastructure services and solutions for the
communications industry. The Company operates its business in four groups:
ACT Communications Group
This group consists of companies that provide products and services
including telephone systems, computer telephony, interactive voice response
systems, flat rate extended area calling services, long distance and local
telephone services, digital satellite services, call centers, networking
services, fiber optic cabling, power distribution services and communication
towers.
ACT Software and Services Group
This group consists of companies that develop and market software products
and services for wireless-enabled applications, data acquisition, field support,
decision support, point of sale and multi-function peripheral devices.
ACT Computer Group
This group consists of companies that provide computer systems,
peripherals, components, specialty systems, cabling, consulting, rental
services, system integration, transportation and de-installation services.
ACT Specialty Manufacturing Group
This group consists of companies that manufacture and market electrical
components, control panels, global positioning systems, satellite modems,
transceivers, controllers, communication devices, orbit modeling applications,
as well as provide design and manufacturing engineering services.
The largest part of the Company's current operations are the result of
acquisitions completed during the last two years. During 1995, the net operating
revenues of the Company were $2.3 million. For 1996, net operating revenues were
$19.9 million, of which almost $14 million was from the Company's then services
and solutions segment. In 1997, the Company completed 14 additional
acquisitions, of companies whose aggregate net revenues for 1997 were $62.4
million, or 60.5% of the Company's total revenues of $103.2 million in 1997.
Since January 1, 1998, the Company has completed 14 additional acquisitions of
companies whose aggregate net revenues for 1997 were $109.4 million.
The principal office of the Company is located at 400 Royal Palm Way, Suite
410, Palm Beach, Florida, 33480. Each operating business is conducted through a
separate subsidiary company directed by its own management team, and each
subsidiary company has its own marketing and operations support personnel. Each
management team reports to a Group Vice President and ultimately to the
Company's President, who is responsible for overall corporate control and
coordination, as well as financial planning. The Chairman is responsible for the
overall business and strategic planning of the Company.
6
<PAGE>
SELLING SHAREHOLDERS
The following table sets forth information regarding the ownership of
the Common Stock by the Selling Shareholders as of the date of this Prospectus
and as adjusted to reflect the sale of the shares of Common Stock offered
hereby.
The Shares have been or will be issued by the Company from time to time
(a) in various acquisition transactions, (b) in consideration for services
rendered, including services under employment agreements and employee bonuses,
or (c) on the exercise of warrants previously issued by the Company, all as
described in the footnotes to the following table. The registration of the
Shares has been effected pursuant to agreements entered into by the Company with
the Selling Shareholders. Although such registration will allow the sale of the
Shares by the Selling Shareholders from time to time as described herein, the
Company believes that the Selling Shareholders do not currently intend to sell
all or substantially all of the Shares.
The percentage owned prior to and after the offering reflects all of
the then outstanding common shares. The amount and percentage owned after the
offering assumes the sale of all of the common shares being registered on behalf
of the selling shareholders.
<TABLE>
- --------------------------------------------------------------------------------------------------
<CAPTION>
Ownership Prior to Number of Shares Ownership After The
Selling Shareholder The Offering Offered Hereby Offering if all
Shares are Sold
- --------------------------------------------------------------------------------------------------
Shares % Shares %
------ - ------ -
<S> <C> <C> <C>
Kerry G. Burst 362,500 * 362,500 (1) - *
Lance J. Umbertis 3,222 * 3,222 (2) - *
Eric J. Steinmann 2,820 * 2,820 (2) - *
Scott A. Capistrano 1,208 * 1,208 (2) - *
John Dixson 806 * 806 (2) - *
Amherst Systems, Inc. 66,667 * 66,667 (3) - *
Bradley A. Haslett 538,462 1.40% 538,462 (4) - *
James S. Bosshart 538,461 1.40% 538,461 (4) - *
William A. Forkner 63,067 * 25,210 (5) 37,857 *
Scott R. Silverman 70,884 * 22,069 (5) 48,815 *
Marc Sherman 616,968 1.60% 131,750 (6) 485,218 1.30%
Edward L. Cummings 80,951 * 31,751 (7) 49,200 *
Michael E. Sham 392,157 1.00% 392,157 (8) - *
Sherri Sheerr 226,217 * 30,933 (9) 195,284 *
Donn J. Wagner 96,154 * 96,154 (10) - *
Angela S. Wagner 96,154 * 96,154 (10) - *
Edward M. Kelly 96,154 * 96,154 (10) - *
Eileen E. Kelly 96,154 * 96,154 (10) - *
Joseph S. Keats 3,692 * 3,692 (11) - *
Patrick C. Chai 192,308 * 192,308 (12) - *
Robert W. Borra 192,308 * 192,308 (12) - *
Maple Business Consultants, Inc. 18,928 * 9,231 (13) 9,697 *
Michael Metropolis 90,257 * 90,257 (14) - *
Michelle Metropolis 90,256 * 90,256 (14) - *
Joseph T. Gabriel 90,256 * 90,256 (14) - *
David Cairnie 10,571 * 10,571 (15) - *
John Booker 32,115 * 32,115 (15) - *
Robin Tyler 32,114 * 32,114 (15) - *
Frederick Bassett 7,693 * 7,693 (15) - *
Alan Cook 2,501 * 2,501 (15) - *
7
<PAGE>
Trevor Gage 2,501 * 2,501 (15) - *
Peter Sayles 2,501 * 2,501 (15) - *
ECI Ventures Nominees Limited 1,489,821 4.00%1,489,821 (15) - *
Fisher Karpark Holdings PLC 759,886 2.00% 759,886 (15) - *
Kevin O'Keefe and Associates 23,082 * 23,082 (16) - *
Frank Lusko 66,552 * 66,552 (17) - *
Mark R. Kruger 66,552 * 66,552 (17) - *
Strategic Alliance Funding & Equity, Inc. 9,655 * 9,655 (18) - *
William A. Husa 3,664 * 3,664 (19) - *
Ralph E. Davies 3,664 * 3,664 (19) - *
John K. Murray 450,411 1.20% 14,760 (20) 435,651 1.20%
Anat Ebenstein 25,333 * 3,258 (20) 22,075 *
Sidney L. Karp Holding Company 25,333 * 3,258 (20) 22,075 *
Capital Alliance Corporation 131,028 * 3,258 (20) 127,770 *
David C. Gerber 961,708 2.60% 116,344 (21) 845,364 2.20%
Toby J. Quesinberry 386,141 1.00% 46,714 (21) 339,427 *
Albert F. Butters, Jr. 262,284 * 31,730 (21) 230,554 *
James C. Millerberg 163,200 * 19,744 (21) 143,456 *
Edelson Technology Partners II, LP 1,028,341 2.70% 80,067 (22) 948,274 2.50%
Michael S. Andison 66,038 * 9,790 (22) 56,248 *
James C. Knight 66,038 * 9,790 (22) 56,248 *
Georges H. Roy 66,038 * 9,790 (22) 56,248 *
M. L. Carole Boisvert 607 * 90 (22) 517 *
Johna L. Giraldi 607 * 90 (22) 517 *
J. Daniel Grondin 607 * 90 (22) 517 *
Edward Lorinez 455 * 67 (22) 388 *
Paul Pappas 202,667 * 8,728 (23) 193,939 *
James M. Shaver 1,923,509 5.10% 516,409 (24) 1,407,100 3.70%
Herman J. Valdez 873,813 2.30% 259,413 (24) 614,400 1.60%
Richard J. Sullivan 359,249 * 256,140 (25) 103,109 *
Daniel E. Penni 427,865 1.10% 250,000 (26) 177,865 *
Arthur F. Noterman 255,000 * 250,000 (26) 5,000 *
Angela M. Sullivan 55,000 * 50,000 (27) 5,000 *
Frank Giacona 8,364 * 8,364 (28) - *
The Bay Group 310,598 * 117,333 (29) 193,265 *
Dana M. Barbera 2,803 * 2,803 (30) - *
Hayden, Buczek & Associates 10,000 * 10,000 (30) - *
Merra, Kanakis, Creme & Mellor, P.C. 7,232 * 4,277 (30) 2,955 *
Totals 14,610,152 7,796,119 6,814,033
---------------------------
</TABLE>
8
<PAGE>
1. Represents shares issued in connection with the Company's acquisition
of The Americom Group, Inc.
2. Represents finder's fees in connection with the Company's acquisition
of The Americom Group, Inc.
3. Represents shares issued in connection with certain assets acquired by
the Company's subsidiary, Atlantic Systems, Inc.
4. Represents shares issued in connection with the Company's acquisition
of Aurora Electric, Inc.
5. Represents finder's fees in connection with the Company's acquisition
of Aurora Electric, Inc. Mr. Silverman is a Vice President of the
Company.
6. Includes (a) 100,000 shares purchased from the Company, and (b) 31,750
shares received as finder's fees in connection with the Company's
subsidiary, Universal Commodities Corp's acquisition of Blue Star
Electronics, Inc., Consolidated Micro Components, Inc., Data Path
Technologies, Inc., GDB Software Services, Inc., and Service Transport
Company. Mr. Sherman is President of Universal Commodities Corp. and a
Group Vice President of the Company.
7. Represents shares received as finder's fees in connection with the
Company's subsidiary, Universal Commodities Corp's acquisition of Blue
Star Electronics, Inc., Consolidated Micro Components, Inc., Data Path
Technologies, Inc., GDB Software Services, Inc., and Service Transport
Company. Mr. Cummings is a Vice President of Universal Commodities
Corp.
8. Represents shares issued in connection with the Company's subsidiary,
Universal Commodities Corp's acquisition of Consolidated Micro
Components, Inc.
9. Represents a finder's fee in connection with the Company's subsidiary,
Universal Commodities Corp's acquisition of Consolidated Micro
Components, Inc.
10. Represents shares issued in connection with the Company's subsidiary,
Universal Commodities Corp's acquisition of Data Path Technologies,
Inc.
11. Represents shares received as finder's fees in connection with the
Company's subsidiary, Universal Commodities Corp's acquisition of Data
Path Technologies, Inc., and GDB Software Services, Inc. Mr. Keats is
a Vice President of Universal Commodities Corp.
12. Represents shares issued in connection with the Company's subsidiary,
Universal Commodities Corp's acquisition of GDB Software Services,
Inc.
13. Represents a finder's fee in connection with the Company's subsidiary,
Universal Commodities Corp's acquisition of GDB Software Services,
Inc.
14. Represents shares issued in connection with the Company's acquisition
of Innovative Vacuum Solutions, Inc.
15. Represents shares issued in connection with the Company's acquisition
of Signature Industries Limited.
16. Represents a finder's fee in connection with the Company's acquisition
of Signature Industries Limited.
17. Represents shares issued in connection with the Company's acquisition
of Teledata Concepts, Inc.
18. Represents a finder's fee in connection with the Company's acquisition
of Teledata Concepts, Inc.
19. Represents the "Price Protection Shares" issued in connection with the
Company's acquisition of CT Specialists, Inc.
20. Represents the "Price Protection Shares" issued in connection with the
Company's acquisition of Information Products Center, Inc.
21. Represents the "Price Protection Shares" issued in connection with the
Company's acquisition of the Fromehill Company dba Winward Electric,
Inc.
22. Represents the "Price Protection Shares" issued in connection with the
Company's acquisition of Canadian Network Services, Inc.
23. Represents the "Price Protection Shares" issued in connection with the
Company's acquisition of Blue Star Electronics, Inc.
24. Represents the "Price Protection Shares" issued in connection with the
Company's acquisition of Advanced Telecommunications, Inc.
25. Includes (a) 200,000 Series "T" Warrants issued at $2.00 per share for
services rendered, and (b) 56,140 shares issued pursuant to Mr.
Sullivan's employment agreements at $3.56 per share in lieu of cash
compensation for the period from June 1, 1998 through May 31, 1999.
Mr. Sullivan is Chairman and Chief Executive Officer of the Company.
26. Includes (a) 200,000 Series "T" Warrants issued at $2.00 per share for
services rendered, and (b) 50,000 shares purchased from the Company at
$2.975 per share. Messrs. Penni and Noterman are Directors of the
Company.
27. Represents 50,000 shares purchased from the Company at $2.975 per
share. Ms. Sullivan is a Director of the Company and is married to
Richard J. Sullivan, Chairman and Chief Executive Officer of the
Company.
28. Represents shares issued in connection with a termination agreement.
Mr. Giacona was an officer of a subsidiary of the Company.
29. Represents shares issued for investment banking services in connection
with various acquisitions made by the Company. The Bay Group is
controlled by Richard J. Sullivan, Chairman and Chief Executive
Officer of the Company, and Angela M. Sullivan, a Director of the
Company.
30. Represents shares issued for professional services rendered.
9
<PAGE>
DESCRIPTION OF ACT CAPITAL STOCK
The Company's Amended and Restated Articles of Incorporation, as amended
("ACT's Articles of Incorporation") authorizes the issuance of up to 80,000,000
shares of ACT Common Stock and up to 5,000,000 shares of preferred stock (the
"Preferred Stock"). The Preferred Stock may be issued from time to time and on
such terms as are specified by the Company's Board of Directors, without further
authorization from the stockholders of the Company.
As of September 29, 1998, there were outstanding 32,531,616 shares of ACT
Common Stock and two Special Preferred Shares, par value $10 per share. In
addition, 4,367,986 shares of ACT Common Stock are reserved for issuance in
exchange for the exchangeable shares of ACT-GFX Canada, Inc. and the
exchangeable shares of Commstar, Ltd., both wholly owned subsidiaries of ACT.
As of September 29, 1998, (a) there were outstanding warrants to purchase
2,510,000 shares of ACT Common Stock at a weighted average exercise price of
$2.71per share, and (b) options held by employees of the Company to purchase
7,307,100 shares of ACT Common Stock at a weighted average exercise price of
$3.66 per share. All of the warrants are currently exercisable. Of the
outstanding options, 1,205,000 are now exercisable at a weighted average
exercise price of $4.43 per share, and the rest become exercisable at various
times over the next three years.
ACT's Common Stock trades on the Nasdaq National Market under the symbol
"ACTC." The following table sets forth the high and low sale prices of ACT
Common Stock as reported by the Nasdaq National Market for each of the quarters
since the beginning of 1996.
High Low
---- ---
1996
First Quarter......... 6-7/8 2-3/4
Second Quarter........ 9-1/8 4
Third Quarter......... 7-7/8 3-3/4
Fourth Quarter........ 7-3/8 4-1/2
1997
First Quarter......... 5-7/8 4
Second Quarter........ 4-3/8 2-5/8
Third Quarter ........ 8-3/4 3-1/16
Fourth Quarter ....... 9-3/4 3-15/16
1998
First Quarter ........ 5-1/2 4-1/32
Second Quarter ....... 4-7/8 3-1/8
Third Quarter
(through September 28, 1998).. 3-1/2 1-9/16
10
<PAGE>
PLAN OF DISTRIBUTION
The Selling Shareholders may sell the Shares offered hereby in one or
more transactions (which may include "block" transactions) on the Nasdaq
National Market, in the over-the-counter market, in negotiated transactions or
in a combination of such methods of sales, at fixed prices which may be changed,
at market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Shareholders may
effect such transactions by selling the Shares directly to purchasers, or may
sell to or through agents, dealers or underwriters designated from time to time,
and such agents, dealers or underwriters may receive compensation in the form of
discounts, concessions or commissions from the Selling Shareholders and/or the
purchaser(s) of the Shares for whom they may act as agent or to whom they may
sell as principals, or both. The Selling Shareholders may also pledge certain of
the Shares from time to time, and this Prospectus also relates to any sale of
Shares that might take place following any foreclosure of such a pledge. The
Selling Shareholders and any agents, dealers or underwriters that act in
connection with the sale of the Shares might be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act, and any discount or
commission received by them and any profit on the resale of the Shares as
principal might be deemed to be underwriting discounts or commissions under the
Securities Act.
The Company will receive no portion of the proceeds from the sale of
the Shares and will bear all of the costs relating to the registration of this
Offering (other than any fees and expenses of counsel for the Selling
Shareholders). Any commissions, discounts or other fees payable to a broker,
dealer, underwriter, agent or market maker in connection with the sale of any of
the Shares will be borne by the Selling Shareholders.
LEGAL MATTERS
Certain legal matters with respect to the ACT Common Stock offered hereby
will be passed upon for the Company by Bryan Cave LLP, St. Louis, Missouri.
EXPERTS
The consolidated financial statements of the Company as of December 31,
1997 and 1996, and for each of the years in the three-year period ended December
31, 1997, have been audited by Rubin, Brown, Gornstein & Co. LLP, independent
public accountants, as indicated in their report with respect thereto, and are
included in the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997, and are incorporated herein by reference, in reliance upon
the authority of such firm as experts in accounting and auditing in giving said
reports.
11
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the expenses (other than underwriting
discounts and commissions), which other than the SEC registration fee are
estimates, payable by the Company in connection with the sale and distribution
of the shares registered hereby**:
SEC Registration Fee .................................... $ 5,750
Accounting Fees and Expenses............................. 2,500 *
Legal Fees and Expenses.................................. 10,000 *
Miscellaneous Expenses................................... 1,750 *
-----------
Total ....................................... $ 20,000 *
===========
- -------------
* Estimated
** The Selling Shareholders will pay any sales commissions or underwriting
discount and fees incurred in connection with the sale of shares
registered hereunder.
Item 15. Indemnification of Directors and Officers.
Sections 351.355(1) and (2) of The General and Business Corporation Law
of the State of Missouri provide that a corporation may indemnify any person who
was or is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding by reason of the fact that he is or was
a director, officer, employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful, except that, in the case of an action or suit by or in the right
of the corporation, the corporation may not indemnify such persons against
judgments and fines and no person shall be indemnified as to any claim, issue or
matter as to which such person shall have been adjudged to be liable for
negligence or misconduct in the performance of his duty to the corporation,
unless and only to the extent that the court in which the action or suit was
brought determines upon application that such person is fairly and reasonably
entitled to indemnity for proper expenses. Section 351.355(3) provides that, to
the extent that a director, officer, employee or agent of the corporation has
been successful in the defense of any such action, suit or proceeding or any
claim, issue or matter therein, he shall be indemnified against expenses,
including attorneys' fees, actually and reasonably incurred in connection with
such action, suit or proceeding. Section 351.355(7) provides that a corporation
may provide additional indemnification to any person indemnifiable under
subsection (1) or (2), provided such additional indemnification is authorized by
the corporation's articles of incorporation or an amendment thereto or by a
shareholder-approved bylaw or agreement, and provided further that no person
shall thereby be indemnified against conduct which was finally adjudged to have
been knowingly fraudulent, deliberately dishonest or willful misconduct or which
involved an accounting for profits pursuant to Section 16(b) of the Securities
Exchange Act of 1934.
The bylaws of the Company provide that the Company shall indemnify, to
the full extent permitted under Missouri law, any director, officer, employee or
agent of the Company who has served as a director, officer, employee or agent of
the Company or, at the Company's request, has served as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers or persons controlling the
Company pursuant to such provisions, the Company has been informed that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in such Act and is therefore unenforceable.
Item 16. Exhibits.
See Exhibit Index.
<PAGE>
Item 17. Undertakings.
(a) The undersigned small business issuer 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;
(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 hereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration
Statement;
(iii)To include any material information with respect to the plan
of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement;
provided, however, that paragraphs (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new Registration Statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the small business issuer pursuant to the foregoing provisions, or
otherwise, the small business issuer has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the small business issuer 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 small business issuer
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 Act and will be governed by the final adjudication of such
issue.
<PAGE>
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 of 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 the City of Palm Beach, State of Florida, on September 29, 1998.
APPLIED CELLULAR TECHNOLOGY, INC.
By: /S/ DAVID A. LOPPERT
------------------------
David A. Loppert, Vice President,
Treasurer and Chief Financial Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints
Garrett A. Sullivan and David A. Loppert, and each of them (with full power to
each of them to act alone), the true and lawful attorney in fact and agent for
the undersigned, to act on behalf of and in the name of the undersigned in
connection with this Registration Statement, including the authority to sign any
amendments (including post-effective amendments) to this Registration Statement,
and to file the same, with exhibits and any and all other documents filed with
respect thereto, with the Securities and Exchange Commission (or any other
governmental or regulatory authority), and each such person ratifies and
confirms all that said attorneys in fact and agents may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
Chairman of the Board of Directors,
Chief Executive Officer and
/S/ RICHARD J. SULLIVAN Secretary(Principal Executive
- ------------------------- Officer) September 29, 1998
(Richard J. Sullivan)
President and Director (Principal
/S/ GARRETT A. SULLIVAN Operating Officer) September 29, 1998
- -------------------------
(Garrett A. Sullivan)
Vice President, Treasurer and Chief
Financial Officer (Principal
/S/ DAVID A. LOPPERT Accounting Officer) September 29, 1998
- -------------------------
( David A. Loppert)
/S/ ANGELA M. SULLIVAN Director September 29, 1998
- -------------------------
(Angela M. Sullivan)
/S/ DANIEL E. PENNI Director September 29, 1998
- -------------------------
(Daniel E. Penni)
/S/ARTHUR F. NOTERMAN Director September 29, 1998
- -------------------------
(Arthur F. Noterman)
/S/CONSTANCE K. WEAVER Director
- -------------------------
(Constance K. Weaver) September 29, 1998
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
4.1 Amended and Restated Articles of Incorporation of the Company
(incorporated herein by reference to Exhibit 4.1 to the Company's
Registration Statement on Form S-3 (File No. 333-37713) filed with the
Commission on November 19, 1997)
4.2 Amendment of Restated Articles of Incorporation of the Company
(incorporated herein by reference to Exhibit 4.2 to the Company's
Registration Statement on Form S-3 (File No. 333-59523) filed with the
Commission on July 21, 1998)
4.3 Amended and Restated Bylaws of the Company dated March 31, 1998
(incorporated herein by reference to Exhibit 4.1 to the Company's
Registration Statement on Form S-3 (File No. 333-51067) filed with the
Commission on April 27, 1998)
5.1 Opinion of Bryan Cave LLP regarding the validity of the Common Stock *
23.1 Consent of Rubin, Brown, Gornstein & Co. LLP *
23.2 Consent of Bryan Cave LLP (included in Exhibit 5.1) *
24.1 Power of Attorney (included in Signature Page)
-------------
* To be filed by amendment
