As filed with the Securities and Exchange Commission on March 4, 1999
Registration No. 333-____________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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THRUSTMASTER, INC.
(Exact name of registrant as specified in its charter)
OREGON 93-1040330
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
SUITE 400, 7175 N.W. EVERGREEN PARKWAY
HILLSBORO, OREGON 97124
(503) 615-3200
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
FRANK G. HAUSMANN, JR.
PRESIDENT AND CHIEF EXECUTIVE OFFICER
THRUSTMASTER, INC.
SUITE 400, 7175 N.W. EVERGREEN PARKWAY
HILLSBORO, OREGON 97124
(503) 615-3200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copies to:
PATRICK J. SIMPSON
DAVID S. MATHESON
PERKINS COIE LLP
SUITE 1500, 1211 S.W. FIFTH AVENUE
PORTLAND, OREGON 97204-3715
(503) 727-2000
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Approximate date of commencement of proposed sale to the public: AS SOON AS
PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities
Act of 1933, 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 of 1933, 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 of 1933, 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. / /
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CALCULATION OF REGISTRATION FEE
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Title of Each Class Amount to be Proposed Maximum Proposed Maximum Amount of
of Securities to Be Registered Registered Offering Price per Share(1) Aggregate Offering Price(1) Registration Fee
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Common Stock, no par value 633,254 $13.28 $8,410,405 $2,338.10
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(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933, based on the high
and low sales prices of the Common Stock on March 1, 1999.
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THE REGISTRANT HEREBY UNDERTAKES TO AMEND 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 THIS REGISTRATION
STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE
COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
The information in this prospectus is not complete and may be changed. The
selling shareholders may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and is not soliciting an
offer to buy these securities in any state where the offer of sale is not
permitted.
SUBJECT TO COMPLETION, DATED MARCH 4, 1999
633,254 SHARES
THRUSTMASTER, INC.
COMMON STOCK
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Certain shareholders of ThrustMaster may offer for sale up to 633,254 shares of
common stock at various times at market prices prevailing at the time of sale or
at privately negotiated prices. The selling shareholders may sell the common
stock to or through broker-dealers, who may receive compensation in the form of
discounts, concessions or commissions.
ThrustMaster will not receive any proceeds from the sale of the shares by the
selling shareholders. ThrustMaster will pay all expenses (other than selling
commissions and fees and stock transfer taxes) of the registration and sale of
the shares.
The common stock trades on the Nasdaq National Market under the symbol "TMSR."
On March 2, 1999, the last reported sales price of the common stock on Nasdaq
was $12.9375 per share.
INVESTING IN THE COMMON STOCK INVOLVES A HIGH DEGREE OF RISK.
SEE "RISK FACTORS" BEGINNING ON PAGE 3.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
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The date of this prospectus is __________, 1999.
TABLE OF CONTENTS
FORWARD-LOOKING INFORMATION ....................................................................... 2
HOW TO OBTAIN MORE INFORMATION .................................................................... 2
THE COMPANY ....................................................................................... 3
RISK FACTORS ...................................................................................... 3
Seasonal and Other Fluctuations in Our Operating Results May Make it Difficult to
Predict Our Future Performance and May Result in Volatility in the Market
Price of Our Common Stock ............................................................... 3
The Intense Competition in Our Markets May Lead to Reduced Sales of Our Products and
Reduced Profits ......................................................................... 4
We May Not be Able to Develop Acceptable New Products or Enhancements to Our Existing
Products at the Rate Required by Our Rapidly Changing Markets ........................... 4
Our Products Have Short Life Cycles ......................................................... 4
Prices for Products in Our Markets are Declining ............................................ 4
We May Need to Access Additional Funds to Finance Ongoing Operations ........................ 5
Offshore Manufacturing and Dependence on Manufacturing Contractors Impose Additional
Risks ................................................................................... 5
We Depend on a Limited Number of Key Customers .............................................. 5
The Loss of Key Personnel or Our Failure to Attract Additional Personnel Could
Adversely Affect Our Business and Decrease the Value of Your Investment ................. 5
The Strain that Changes in Our Growth Rate Places Upon Our Systems and Management
Resources May Adversely Affect Our Business and Decrease the Value of Your
Investment .............................................................................. 6
Our International Sales are Significant and Could Decrease for Reasons Additional to
Those Affecting Domestic Sales .......................................................... 6
We May be Unable to Protect Our Intellectual Property; Others May Bring Infringement
Claims Against Us ....................................................................... 6
Product Defects Could Lead to Losses of Customers ........................................... 7
We Depend on a Small Group of Suppliers for Critical Components ............................. 7
Changes in our Distribution Network May Adversely Affect our Business ....................... 7
Some of Our Products May Not be Year 2000 Compliant, Which Could Result in Customer
Dissatisfaction or Claims Against Us .................................................... 8
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Our Anti-Takeover Provisions and Preferred Stock May Reduce the Market Price of Our
Common Stock ............................................................................ 8
Sales of Stock by Existing Shareholders May Reduce the Market Price of Our Stock ............ 8
The Market Price for Our Common Stock, Like Other Technology Stocks, May be Volatile ........ 9
SELLING SHAREHOLDERS .............................................................................. 10
PLAN OF DISTRIBUTION .............................................................................. 11
VALIDITY OF COMMON STOCK .......................................................................... 12
EXPERTS ........................................................................................... 12
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FORWARD-LOOKING INFORMATION
This prospectus and the documents we incorporate by reference contain
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. The Act provides a "safe harbor" for
forward-looking statements to encourage companies to provide prospective
information about themselves so long as they identify these statement as
forward-looking and provide meaningful cautionary statements identifying
important factors that could cause actual results to differ from the projected
results. All statements other than statements of historical fact we make in this
prospectus or in any document incorporated by reference are forward-looking. In
particular, statements regarding industry prospects and our future results of
operations or financial position are forward-looking statements. Words such as
"anticipates," "expects," "intends," "plans," "believes," "seeks," estimates,"
and similar expressions identify forward-looking statements. But the absence of
these words does not mean the statement is not forward-looking. We cannot
guarantee any of the forward-looking statements, which are subject to risks,
uncertainties and assumptions that are difficult to predict. Actual results may
differ materially from those we forecast in forward-looking statements due to a
variety of factors, including those set forth in the section entitled "Risk
Factors," elsewhere in this prospectus and in the documents we have incorporated
by reference. We do not intend to update any forward-looking statements due to
new information, future events or otherwise.
HOW TO OBTAIN MORE INFORMATION
We file reports, proxy statements and other information with the
Securities and Exchange Commission. You may read any document we file at the
SEC's public reference rooms in Washington, D.C., Chicago, Illinois and New
York, New York. Please call the SEC toll free at 1-800-732-0330 for information
about its public reference rooms. You may also read our filings at the SEC's web
site at http://www.sec.gov.
We have filed with the SEC a registration statement on Form S-3 under
the Securities Act of 1933. This prospectus does not contain all of the
information in the registration statement. We have omitted certain parts of the
registration statement, as permitted by the rules and regulations of the SEC.
You may inspect and copy the registration statement, including exhibits, at the
SEC's public reference rooms or from its web site. Our statements in this
prospectus about the contents of any contract or other document are not
necessarily complete. You should refer to the copy of each contract or other
document we have filed as an exhibit to the registration statement for complete
information.
The SEC allows us to "incorporate by reference" into this prospectus
information we file with it. This means that we can disclose important
information to you by referring you to those documents. The information we
incorporate by reference is considered a part of this prospectus, and later
information we file with the SEC will automatically update and supersede this
information. We incorporate by reference the documents listed below and any
future filings we make with the SEC under Sections 13(a), 13(c), 14 and 15(d) of
the Securities Exchange Act of 1934 until this offering is completed:
1. ThrustMaster's Annual Report on Form 10-K for the year ended
December 31, 1997;
2. ThrustMaster's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1998, June 30, 1998 and September 30, 1998;
3. The description of the common stock in ThrustMaster's
Registration Statement on Form 8-A filed on February 8, 1995,
including any amendment or report filed to update the
description; and
4. All other documents filed by ThrustMaster pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date
of this prospectus and prior to the termination of this
offering.
You may obtain copies of these documents, other than exhibits, free of
charge by contacting ThrustMaster's corporate secretary at our principal
offices, which are located at Suite 400, 7175 N.W. Evergreen Parkway, Hillsboro,
Oregon 97124, telephone number (503) 615-3200.
You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus
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supplement. We have not authorized anyone to provide you with different
information. The selling shareholders are not making an offer of these
securities in any state where the offer is not permitted. You should not
assume that the information in this prospectus or any prospectus supplement is
accurate as of any date other than the date on the front of the document.
THE COMPANY
ThrustMaster designs, develops, manufactures and markets a diversified
line of innovative and technologically advanced game controllers for the home
personal computer market and Talk n'Play, an Internet conferencing solution
based on Intel technology that enables up to four people from separate locations
to talk to each other over the Internet while simultaneously playing an online
computer game. We have established ThrustMaster-Registered Trademark- as a brand
name recognized for quality, value, durability and ease of use. ThrustMaster
products enhance the enjoyment of the personal computer entertainment experience
and appeal to a wide variety of users, from occasional game players to avid
enthusiasts. Our game controllers include racing wheels, joysticks, game pads
and flight simulation controllers. Our products are available in over 5,000
retail outlets in North America and Europe.
We were incorporated in Oregon in 1990. Our principal executive offices
are located at Suite 400, 7175 N.W. Evergreen Parkway, Hillsboro, Oregon 97124.
Our main telephone number is (503) 615-3200.
RISK FACTORS
Before investing in the common stock, you should consider carefully the
following factors, as well as the information contained in the rest of this
prospectus and in the documents we incorporate by reference.
SEASONAL AND OTHER FLUCTUATIONS IN OUR OPERATING RESULTS MAY MAKE IT DIFFICULT
TO PREDICT OUR FUTURE PERFORMANCE AND MAY RESULT IN VOLATILITY IN THE MARKET
PRICE OF OUR COMMON STOCK
We generally experience seasonality in our operating results.
ThrustMaster's revenues typically are substantially higher in the fourth quarter
of the year, reflecting traditional retail seasonality patterns. In addition to
seasonal fluctuations, we may experience significant fluctuations in our
operating results from other causes.
The volume and timing of orders received during a quarter are difficult
to forecast. Customers generally order on an as-needed basis and, accordingly,
we have historically operated with a relatively small backlog. This reduces our
ability to accurately forecast revenue. Our revenue in a given period depends on
the volume and timing of orders received during the period, the timing of new
product introductions by us and our competitors, product line maturation, the
impact of price competition on our average selling prices, the availability of
components for ThrustMaster products, changes in product or distribution channel
mix, the level of inventory carried by our distribution and retail channel
customers, and product returns and price protection charges from customers.
These factors all tend to make the timing of revenue unpredictable and may lead
to significant period-to-period fluctuations in revenue.
ThrustMaster's gross margins are affected by short product life cycles,
the mix of products sold, the mix of distribution channels used, competitive
price pressures, the availability and cost of components from our suppliers,
component price inflation or deflation, end-of-life inventory write downs and
general economic conditions. Individual product lines generally provide higher
margins at the beginning of the typical 12-to-18-month product life cycle, and
lower margins as the product line matures. If a product's life is shorter than
expected, unexpected distribution channel inventory returns and end-of-life and
obsolete inventory and tooling charges could result, which would depress our
revenue and gross margin in the affected period.
A disproportionate percentage of the Company's revenue in any quarter
may be generated in the last month or weeks of a quarter. As a result, a
shortfall in sales in any quarter as compared to expectations may not be
identifiable until at or near the end of the quarter.
Notwithstanding the difficulty in forecasting future sales and the
relatively small level of backlog at any given
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time, we generally must plan production, order components and undertake our
development, sales and marketing activities and other commitments months in
advance. Accordingly, impacts of shortfalls in revenue may be magnified due to
our inability to adjust expenses or inventory levels during the quarter to
match the level of revenue for the quarter. Conversely, in our efforts to
adjust inventory levels to a slower order rate, we may overcorrect our
component purchases and inventory levels, resulting in periodic shortages of
inventory and delivery delays and negatively affecting our revenue, market
share and customer satisfaction levels in the current quarter or in future
quarters.
For these reasons, we believe that our quarterly revenue and results
from operations are likely to vary significantly in the future and that
quarter-to-quarter comparisons of our operating results may not be meaningful.
You should therefore not rely on the results of one quarter as an indication of
future performance.
THE INTENSE COMPETITION IN OUR MARKETS MAY LEAD TO REDUCED SALES OF OUR PRODUCTS
AND REDUCED PROFITS
The markets for our products are intensely competitive and are likely
to become even more competitive. Increased competition often results in
pricing pressures, reduced sales, reduced margins, or the failure of products
to achieve or maintain market acceptance, any of which could have a material
adverse effect on our business, results of operations, and financial
condition. Each of our products faces intense competition from multiple
competing vendors. Competitors such as Microsoft have greater name
recognition, access to larger customer bases, and substantially greater
financial, technical, marketing, distribution, service, support, and other
resources than we have, and may be able to respond more quickly than we can
to new or changing opportunities, technologies, standards, or customer
requirements.
WE MAY NOT BE ABLE TO DEVELOP ACCEPTABLE NEW PRODUCTS OR ENHANCEMENTS TO OUR
EXISTING PRODUCTS AT THE RATE REQUIRED BY OUR RAPIDLY CHANGING MARKETS
Our future success depends upon our ability to address the rapidly
changing needs of our customers by developing and introducing high quality
products, product enhancements, and services on a timely basis and by keeping
pace with technological developments and emerging industry standards. The
markets for our products are rapidly evolving. Failure to develop and release
enhanced or new products, or delays or quality problems in doing so, could have
a material adverse effect on our business, results of operations, and financial
condition. As is common in rapidly evolving markets, demand and market
acceptance for recently introduced products are subject to high levels of
uncertainty and risk. New products can also quickly render obsolete products
that were only recently in high demand. The markets for our existing products
may not be sustainable at their current levels. The markets for recently
introduced and planned products may not expand or develop.
OUR PRODUCTS HAVE SHORT LIFE CYCLES
The markets for ThrustMaster's products are characterized by frequent
new product introductions and product obsolescence. These factors typically
result in short product life cycles, frequently ranging from 12 to 18 months. We
must develop and introduce new products in a timely manner that compete
effectively on the basis of price and performance and that address customer
needs. To do this, we must continually monitor industry trends and make
difficult choices regarding the selection of new technologies and features to
incorporate into our new products, as well as the timing of when to introduce
new products, all of which may impair the orders for or the prices of our
existing products.
Each new product cycle presents new opportunities for current or
prospective ThrustMaster competitors to gain a product advantage or increase
their market share. If we do not successfully introduce new products within a
given product cycle, our sales will be adversely affected for that cycle and
possibly for subsequent cycles. Any such failure could also impair our brand
name and ability to command retail shelf space in future periods.
PRICES FOR PRODUCTS IN OUR MARKETS ARE DECLINING
ThrustMaster's markets are characterized by intense ongoing competition
coupled with declining average selling prices. Accordingly, our average selling
prices, measured over a given period of time, may decline from the levels
experienced to date. Such a decline could cause our revenue and gross margins to
decline relative to prior periods.
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WE MAY NEED TO ACCESS ADDITIONAL FUNDS TO FINANCE ONGOING OPERATIONS
As of March 1, 1999, ThrustMaster believes that available funds
together with borrowings from our credit facility will be adequate to meet our
anticipated cash needs during the immediate term. However, there can be no
assurance that additional capital beyond the amounts currently forecast by us
will not be required nor that any such required additional capital will be
available on reasonable terms, if at all, at such time or times as required by
us. Additional financing may involve public or private offerings of debt or
equity securities, and may include bank debt. Debt financing may increase our
leveraged position, require us to devote significant cash to service debt and
limit funds available for working capital, capital expenditures, and general
corporate purposes, all of which could increase our vulnerability to adverse
economic and industry conditions and competitive pressures. Equity financing may
cause additional dilution to purchasers of ThrustMaster common stock.
OFFSHORE MANUFACTURING AND DEPENDENCE ON MANUFACTURING CONTRACTORS IMPOSE
ADDITIONAL RISKS
Virtually all ThrustMaster products are manufactured in China and
Taiwan by independent contractors. Our use of offshore manufacturing is subject
to the customary risks of doing business abroad, including fluctuations in the
value of currencies, tariffs, export duties, quotas, restrictions on the
transfer of funds, work stoppages and political instability.
For the year ended December 31, 1998, approximately 84.4% of our products
were manufactured through a single vendor utilizing factories located in Taiwan
and the Guangdong province of China. Manufacturing at one factory accounted for
more than half of our production. If any of the manufacturing facilities
utilized by us become unavailable, or if the manufacturing operations at these
facilities are slowed, interrupted or terminated, our business, financial
condition and results of operation could be materially and adversely affected.
We may not be able to enter into satisfactory alternative third-party
manufacturing arrangements. In addition, although we seek to control the quality
of its products manufactured offshore, quality problems have occasionally
arisen, and may in the future arise, that are beyond our direct control. The use
of independent manufacturing contractors to manufacture and assemble products
offshore also has required us to increase production lead times and has reduced
our ability to adjust production in response to short-term market conditions. As
a result, our failure to adequately forecast demand of products manufactured
offshore could materially and adversely affect our sales and results of
operations.
WE DEPEND ON A LIMITED NUMBER OF KEY CUSTOMERS
ThrustMaster anticipates that a significant portion of our revenues and
accounts receivable will continue to be derived from a limited number of key
customers. For the year ended December 31, 1998, two customers accounted for an
aggregate of approximately 24.9% of our revenues. The loss of one or more key
customers or any significant reduction in orders by such customers could have a
material adverse effect on our business, results of operations or financial
condition.
THE LOSS OF KEY PERSONNEL OR OUR FAILURE TO ATTRACT ADDITIONAL PERSONNEL COULD
ADVERSELY AFFECT OUR BUSINESS AND DECREASE THE VALUE OF YOUR INVESTMENT
Our success depends largely upon the continued services of our
executive officers and other key management and development personnel. The
loss of the services of one or more of our executive officers, engineering
personnel, or other key employees could have a material adverse effect on our
business, results of operations, and financial condition. In particular, we
rely on Frank G. Hausmann, Jr., President and Chief Executive Officer, and G.
Edward Brightman, Vice President, Operations. Our employees do not have
employment agreements and could terminate their employment with us at any
time without penalty. We do not maintain key person life insurance policies
on any of our employees.
Our future success also depends on our ability to attract and retain
highly qualified personnel. We may not be successful in attracting or retaining
qualified personnel, which could have a material adverse effect on our business,
results of operations, and financial condition. The competition for qualified
personnel in the computer software and game markets is intense, and we may be
unable to attract, assimilate, or retain additional highly qualified personnel
in the future. We attempt to hire engineers with high levels of experience in
designing and developing software and personal computer-related products in
time-pressured environments. There is a limited number of qualified engineers in
our geographic location, resulting in intense competition for their services.
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THE STRAIN THAT CHANGES IN OUR GROWTH RATE PLACES UPON OUR SYSTEMS AND
MANAGEMENT RESOURCES MAY ADVERSELY AFFECT OUR BUSINESS AND DECREASE THE
VALUE OF YOUR INVESTMENT
Any failure to properly manage our growth could have a material adverse
effect on our business, results of operations, and financial condition. The
growth and contractions that we have experienced place significant challenges on
our management, administrative, and operational resources. To properly manage
our business, we must, among other things, implement and improve additional and
existing administrative, financial, and operational systems, procedures, and
controls on a timely basis. We may not be able to complete the necessary
improvements to our systems, procedures, and controls necessary to support our
future operations in a timely manner. Management may not be able to hire, train,
retain, motivate, and manage required personnel and may not be able to
successfully identify, manage, and exploit existing and potential market
opportunities.
OUR INTERNATIONAL SALES ARE SIGNIFICANT AND COULD DECREASE FOR REASONS
ADDITIONAL TO THOSE AFFECTING DOMESTIC SALES
Approximately 29.6% and 35.7% of our total revenue for the years ended
December 31, 1997 and 1998, respectively, were attributable to sales made
outside the United States. Any reduction in international sales, or our failure
to further develop our international distribution channels, could have a
material adverse effect on our business, results of operations, and financial
condition.
Our international operations are subject to the risks inherent in
international business activities, including, in particular:
- Management of an organization operating in various countries;
- Compliance with a variety of foreign laws and regulations;
- Overlap of different tax structures;
- Foreign currency exchange rate fluctuations, which may affect
demand for our products in international markets or our
consolidated multinational financial results;
- Trade restrictions, changes in tariffs, and freight rates; and
- Regional economic and political conditions.
These factors could have a material adverse effect on our future international
sales and, consequently, our business, results of operations, and financial
condition.
WE MAY BE UNABLE TO PROTECT OUR INTELLECTUAL PROPERTY; OTHERS MAY BRING
INFRINGEMENT CLAIMS AGAINST US
We regard substantial elements of our products as proprietary and
attempt to protect them by relying on patent, trademark, service mark, trade
dress, copyright, and trade secret laws and restrictions, as well as
confidentiality procedures and contractual provisions. Any steps we take to
protect our intellectual property may be inadequate, time consuming, and
expensive. In addition, despite our efforts, we may be unable to prevent
third-parties from infringing upon or misappropriating our intellectual
property. Any such infringement or misappropriation could have a material
adverse effect on our business, results of operations, and financial condition.
Currently issued patents or any new patent applications may not provide us with
any competitive advantages, or may be challenged by third parties. Effective
trademark, copyright, and trade secret protection may not be available in every
country in which our products are distributed. In addition, our competitors may
independently develop similar technology that substantially limits the value of
our intellectual property.
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We also have acquired or licensed technologies from other companies.
Our internally developed technology or the technology we acquired or licensed
may infringe on a third party's intellectual property rights and such third
parties may bring claims against us alleging infringement of their intellectual
property rights. Any such infringement or claim of infringement could have a
material adverse affect on our business, result of operations, and financial
condition.
In recent years, there has been significant litigation in the United
States involving patents and other intellectual property rights. We are not
currently involved in any intellectual property litigation. We may, however, be
a party to litigation in the future to protect our intellectual property or as a
result of an alleged infringement of others' intellectual property. Such claims
and any resulting litigation could subject us to significant liability for
damages and invalidation of our proprietary rights. Such litigation, regardless
of its success, likely would be time-consuming and expensive to defend and would
divert management time and attention. Any potential intellectual property
litigation could also force us to do one or more of the following:
- Cease selling, incorporating, or using products or services that
incorporate the challenged intellectual property;
- Obtain from the holder of the infringed intellectual property
right a license to sell or use the relevant technology, which
license may not be available on reasonable terms, or at all;
and
- Redesign those products or services that incorporate such technology.
Any of these results could have a material adverse effect on our
business, results of operations, and financial condition.
PRODUCT DEFECTS COULD LEAD TO LOSSES OF CUSTOMERS
Product components may contain undetected errors or "bugs" when first
supplied to us that, despite our internal testing, are discovered only after
certain of our products have been installed and used by customers. We continue
to upgrade the firmware and software utilities that are incorporated into or
included with our products. Our products are complex as a result of factors
including advanced functionality, the diverse operating environments in which
the products may be deployed, the need for interoperability, and the multiple
versions of such products that must be supported for diverse operating platforms
and standards. Despite our testing, these products may contain undetected errors
or failures when first introduced or as new versions or enhancements are
released. Problems encountered by customers or product recalls could materially
adversely affect our business, financial condition and results of operations.
WE DEPEND ON A SMALL GROUP OF SUPPLIERS FOR CRITICAL COMPONENTS
Certain key components used in ThrustMaster products are obtained from
one or a limited group of suppliers. Any reduction, interruption of or delay in
supply could materially and adversely affect our business, results of operations
or financial condition. We have had and may in the future have, shortages of
supplies and delays in deliveries of necessary components. Substantially all
components used in our products are purchased from sources located outside the
United States. Trading policies adopted by the United States or foreign
governments could restrict the availability of components or increase the cost
of obtaining them. Any significant increase in component prices or decrease in
component availability could materially and adversely affect our business,
results of operations and financial condition.
CHANGES IN OUR DISTRIBUTION NETWORK MAY ADVERSELY AFFECT OUR BUSINESS
We sell our products through a network of domestic and international
distributors, and directly to major retailers/mass merchants. Our future success
is dependent on the continued viability and financial stability of our customer
base. Personal computer distribution and retail channels historically have been
characterized by rapid change, including periods of widespread financial
difficulties and consolidation and the emergence of alternative sales channels,
such as direct mail order, telephone sales by PC manufacturers and electronic
commerce on the Internet. Changes in distribution channel
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patterns, such as increased commerce on the Internet, increased use of
mail-order catalogs, increased use of consumer-electronics channels for
personal computer sales, or increased use of channel assembly to configure PC
systems to fit customers' requirements could affect ThrustMaster in unforeseen
ways. Moreover, additions to or changes in the types of products we sell, such
as the introduction of non-gaming products or the migration toward more
communications-centric products, may require specialized channel partnerships;
relationships which we have only begun to establish.
Inventory levels of the distribution channels used by ThrustMaster
generally are maintained in a range of one to three months of customer demand.
These channel inventory levels tend toward the low end of the months-of-supply
range when demand is stronger, sales are higher and products are in short
supply. Conversely, when demand is slower, sales are lower and products are
abundant, these channel inventory levels tend toward the high end of the
months-of-supply range. Frequently, in such situations, we attempt to ensure
that distributors and retailers devote their working capital, sales and
logistics resources to ThrustMaster products to a greater degree than to those
of competitors. Similarly, our competitors attempt to ensure that their own
products are receiving a disproportionately higher share of the distributors'
working capital and logistics resources. We believe that we are currently
operating in a period of slower demand, lower sales and abundant products,
leading to existing distribution channel inventory levels of older product that
are higher than desirable. Further, in such an environment of slower demand and
abundant supply of products, price declines are more likely to occur and, should
they occur, are more likely to be severe. In such an event, high distribution
channel inventory levels may result in substantial price protection charges.
Such price protection charges have the effect of reducing net revenue and gross
profit.
SOME OF OUR PRODUCTS AND SYSTEMS MAY NOT BE YEAR 2000 COMPLIANT, WHICH COULD
RESULT IN CUSTOMER DISSATISFACTION, CLAIMS AGAINST US OR DELAYS IN
PROCESSING INFORMATION
Failure of our products to be year 2000 compliant in a timely manner
could result in significant decreases in market acceptance of our products,
which could have a material adverse effect on our business, results of
operations, and financial condition. We have not tested our products in every
possible computer environment and, accordingly, such products may not be fully
year 2000 compliant. Older versions of our products may not be year 2000
compliant. We have not tested for year 2000 compliance of discontinued products
that we no longer market, some of which remain in use. These discontinued
products may not be year 2000 compliant.
If we or our suppliers, vendors, major distributors, and partners fail to
correct year 2000 problems, such failure could result in an interruption
in, or a failure of, our normal business activities or operations. Such failures
could have a material adverse effect on our business, results of operations, and
financial condition. Due to the uncertainty of the year 2000 readiness of
third-party suppliers, vendors, distributors and partners, we are unable to
determine at this time whether the consequences of any year 2000 failures will
have a material effect on our business, results of operations, and financial
condition.
OUR ANTI-TAKEOVER PROVISIONS AND PREFERRED STOCK MAY REDUCE THE MARKET PRICE OF
OUR COMMON STOCK
Provisions of our articles of incorporation and bylaws may have the
effect of delaying or preventing a merger or sale of ThrustMaster, or making a
merger or acquisition less desirable to a potential acquirer, even where
shareholders may consider the acquisition or merger favorable. These provisions
include those establishing a classified Board of Directors. Provisions of the
Oregon Business Corporation Act, including certain "business combination"
provisions and the Control Share Act, also may delay, prevent, or discourage
someone from acquiring or merging with us.
The issuance of preferred stock may have the effect of delaying,
deferring, or preventing a change in control without further action by the
shareholders. Any such issuance may materially and adversely affect the market
price of the common stock and the voting rights of the holders of common stock.
The issuance of preferred stock may also result in the loss of the voting
control of holders of common stock to the holders of preferred stock. We are
authorized to issue up to 5,000,000 shares of preferred stock.
SALES OF STOCK BY EXISTING SHAREHOLDERS MAY REDUCE THE MARKET PRICE OF OUR STOCK
Sales of substantial amounts of ThrustMaster common stock in the public
market by existing shareholders or further issuances of capital stock by us
could adversely affect the price of the common stock. As of March 1, 1999,
-8-
approximately all of the outstanding shares of common stock, other than the
shares offered hereby, are freely tradable under federal securities laws to the
extent that they are not held by ThrustMaster affiliates.
THE MARKET PRICE FOR OUR COMMON STOCK, LIKE OTHER TECHNOLOGY STOCKS, MAY BE
VOLATILE
The value of your investment in ThrustMaster could decline due to the
impact of any of the following factors upon the market price of our common
stock:
- Variations in our actual and anticipated operating results;
- Changes in our earnings estimates by analysts;
- Our failure to meet analysts' performance expectations; and
- Lack of liquidity.
The stock markets have recently experienced stock price and volume
volatility that has affected companies' stock prices. The stock markets may
continue to experience volatility that may adversely affect the market price of
our common stock.
Stock prices for many companies in the technology sector have
experienced wide fluctuations that have often been unrelated to the operating
performance of such companies. Fluctuations such as these may affect the market
price of our common stock.
-9-
SELLING SHAREHOLDERS
The following table presents information regarding the selling
shareholders and the number of shares they may offer by this prospectus as of
March 1, 1999.
Number of Shares of Shares of Common Stock
Common Stock Number of Shares of Beneficially Owned After the Offering(5)
Beneficially Owned Common Stock ---------------------------------------
Selling Shareholder Prior to the Offering Offered Hereby(4) Number of Shares Percentage of Class
------------------- --------------------- ------------------- ---------------- -------------------
Strong River Investments, Inc. 160,378(1) 316,628 0 *
Montrose Investments L.P. 104,244(2) 205,807 0 *
Westover Investments L.P. 56,132(3) 110,818 0 *
- --------------------------
* Represents less than one percent of the common stock outstanding.
(1) Represents 125,000 shares of common stock purchased in the transaction
described below and 35,378 shares of common stock issuable upon exercise of
warrants issued in connection therewith.
(2) Represents 81,250 shares of common stock purchased in the transaction
described below and 22,994 shares of common stock issuable upon exercise of
warrants issued in connection therewith.
(3) Represents 43,750 shares of common stock purchased in the transaction
described below and 12,382 shares of common stock issuable upon exercise of
warrants issued in connection therewith.
(4) Represents the shares of common stock indicated in Notes 1, 2 and 3 above as
beneficially owned by the selling shareholders and additional shares (the
"Adjustment Shares") of common stock that may be issued to the selling
shareholders as a post-closing adjustment to the number of shares originally
issued in the transaction described below. Since the number of Adjustment
Shares that may be issued is dependent upon the market price of the common
stock prior to the issuance thereof, the actual number of Adjustment Shares
that may be issued and, consequently, offered for sale under this
prospectus, cannot be determined at this time. However, ThrustMaster has
agreed to include in this prospectus an aggregate of 633,254 shares of its
common stock to cover the resale of shares of common stock indicated above
as beneficially owned by the selling shareholders as well as Adjustment
Shares that may be issued to them.
(5) Assumes the sale of all shares of common stock offered thereby.
The selling shareholders purchased an aggregate of 250,000 shares of
ThrustMaster common stock at a price of $16.00 per share in a private
transaction on January 28, 1999. The selling shareholders may purchase up to
35,377 additional shares at the price of $20.00 per share and up to an
additional 35,377 shares at the price of $22.40 per share upon the exercise of
warrants issued in connection with the transaction. The remaining 312,500 shares
may be issued to the selling shareholders, at no additional cost to them, as a
post-closing adjustment to the number of shares originally issued in the
transaction. Since the number of adjustment shares that may be issued is
dependent upon the market price of the common stock prior to the issuance
thereof, the actual number of adjustment shares that may be issued and,
consequently, offered for sale under this prospectus, cannot be determined at
this time. However, ThrustMaster has agreed to include in this prospectus an
aggregate of 633,254 shares of its common stock to cover the resale of shares of
common stock issued or that may be issued in connection with the January 28,1999
transaction.
None of the selling shareholders has had any material relationship with
ThrustMaster or its affiliates within the past three years.
The selling shareholders have represented to us that they purchased the
shares for their own account for investment
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only and not with a view towards selling or distributing them, except pursuant
to sales registered under the Securities Act or exemptions. ThrustMaster
agreed with the selling shareholders to file the registration statement to
register the resale of the shares. ThrustMaster agreed to prepare and file all
necessary amendments and supplements to the registration statement to keep it
effective until the earlier of (1) the third anniversary of the effective date
of the registration statement related to this prospectus and (2) the date on
which the selling shareholders have sold all the shares.
PLAN OF DISTRIBUTION
We are registering the shares on behalf of the selling shareholders and
certain of their successors (including donees and pledgees, who may sell shares
they receive from the selling shareholders after the date of this prospectus).
The selling shareholders or such successors may sell all of the shares from time
to time in transactions in the over-the-counter market through Nasdaq, or on one
or more other securities markets and exchanges, or in privately negotiated
transactions. They may sell the shares at fixed prices, at market prices
prevailing at the time of sale or at negotiated prices. The selling shareholders
may use any one or more of the following methods when selling shares:
- ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
- block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
- purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
- an exchange distribution in accordance with the rules of the
applicable exchange;
- privately negotiated transactions;
- short sales;
- broker-dealers may agree with the selling shareholders to sell a
specified number of the shares at a stipulated price per share;
- a combination of any such methods of sale; and
- any other method permitted pursuant to applicable law.
The selling shareholders may also sell shares under SEC Rule 144, if
available, rather than under this prospectus.
The selling shareholders may effect short sales against the box, puts
and calls and other transactions in securities of ThrustMaster or derivatives of
ThrustMaster securities, and may sell or deliver the shares in connection with
these trades. The selling shareholders may pledge the shares to their brokers
under the margin provisions of customer agreements. If a selling shareholder
defaults on a margin loan, the broker may, from time to time, offer and sell the
pledged shares.
Broker-dealers engaged by the selling shareholders may arrange for
other brokers-dealers to participate in sales. Broker-dealers may receive
commissions, concessions or discounts from the selling shareholders and/or the
purchasers. The selling shareholders do not expect these commissions,
concessions and discounts to exceed what is customary in the types of
transactions involved.
The selling shareholders have advised us that they have not entered
into any agreements, understandings or arrangements for the sale of the shares
with any underwriters or broker-dealers and that no underwriter or coordinating
broker is now acting in connection with the proposed sale of shares.
ThrustMaster will not receive any proceeds from the sale of the shares
by the selling shareholders. ThrustMaster may suspend use of this prospectus
under certain circumstances.
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The selling shareholders and any broker-dealers or agents that are
involved in selling the shares may be deemed to be "underwriters" within the
meaning of the Securities Act. In such event, any commissions received by them
and any profit on the resale of the shares may be deemed to be underwriting
commissions or discounts under the Securities Act. Selling shareholders who are
"underwriters" within the meaning of Section 2(11) of the Securities Act will be
subject to the prospectus delivery requirements of the Securities Act. We have
informed the selling shareholders that the anti-manipulation provisions of
Regulation M of the Exchange Act may restrict their sales in the market.
ThrustMaster will pay all expenses (other than selling commissions and
fees and stock transfer taxes) of the registration and sale of the shares.
ThrustMaster also has agreed to indemnify the selling shareholders and
broker-dealers who assist in the sale of the shares against certain liabilities,
including liabilities under the Securities Act. The selling shareholders may
indemnify any agent, dealer or broker-dealer that assists them in selling the
shares against certain liabilities, including liabilities arising under the
Securities Act.
If a selling shareholder notifies us that any material arrangement has
been entered into with a broker-dealer for the sale of shares through a block
trade, special offering, exchange distribution or secondary distribution or a
purchase by a broker or dealer, we will file a supplement to this prospectus, if
required, pursuant to Rule 424(b) under the Securities Act. The supplement will
disclose (i) the name of each such selling shareholder and of the participating
broker-dealer(s), (ii) the number of shares involved, (iii) the price at which
the shares were sold, (iv) the commissions paid or discounts or concessions
allowed to such broker-dealer(s), where applicable, (v) that such
broker-dealer(s) did not conduct any investigation to verify the information set
forth or incorporated by reference in this prospectus, and (vi) other facts
material to the transaction. In addition, if a selling shareholder notifies us
that a donee or pledgee intends to sell more than 500 shares, a supplement to
this prospectus will be filed. To the extent required, we will also set forth in
a supplement to this prospectus or, if appropriate, a post-effective amendment
to the related registration statement, the number of the shares to be sold,
purchase prices, public offering prices, the names of any agents, dealers or
underwriters, and any applicable commissions, discounts or concessions with
respect to a particular offer.
We cannot guarantee that the selling shareholders will sell any or all
of the shares.
VALIDITY OF COMMON STOCK
Perkins Coie LLP, Portland, Oregon, will provide ThrustMaster with an
opinion as to legal matters in connection with the common stock offered by this
prospectus.
EXPERTS
The financial statements incorporated in this prospectus by reference
to the Annual Report on Form 10-K for the year ended December 31, 1997, have
been so incorporated in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
-12-
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
WE HAVE NOT AUTHORIZED ANY PERSON TO GIVE YOU ANY INFORMATION OR TO MAKE
ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS. YOU SHOULD
NOT RELY ON ANY INFORMATION OR REPRESENTATIONS OTHER THAN THIS PROSPECTUS. THIS
PROSPECTUS IS NOT AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES OTHER THAN THE COMMON STOCK. IT IS NOT AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY SECURITIES IF THE OFFER OR SOLICITATION WOULD BE
UNLAWFUL. THE AFFAIRS OF THRUSTMASTER MAY HAVE CHANGED SINCE THE DATE OF THIS
PROSPECTUS. YOU SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS IS
CORRECT AT ANY TIME SUBSEQUENT TO ITS DATE.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
633,254 SHARES
THRUSTMASTER, INC.
COMMON STOCK
--------------
PROSPECTUS
--------------
________________, 1999
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses payable by the
Registrant in connection with the sale of Common Stock being registered. All
amounts are estimates except the SEC registration fee and the Nasdaq National
Market additional listing fee. The selling shareholders will pay all selling
commissions and fees and stock transfer taxes.
SEC registration fee........................................ $ 2,338
Nasdaq National Market listing fee.......................... $12,665
Legal fees and expenses..................................... $ 7,500
Accounting fees and expenses................................ $ 4,500
Miscellaneous fees and expenses............................. $ 997
-------
Total.................................................. $28,000
-------
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
As an Oregon corporation, the Registrant is subject to the Oregon
Business Corporation Act. Pursuant to Section 60.047(2)(d) of the Oregon
Business Corporation Act, Article X of the Registrant's Articles of
Incorporation (Exhibit 4.1 hereto) eliminates the liability of the Registrant's
directors to the Registrant or its shareholders, except for any liability
related to (i) any breach of the duty of loyalty to the Registrant or its
shareholders; (ii) acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law; (iii) any distribution
that is unlawful under the Oregon Business Corporation Act; or (iv) any
transaction from which the director derived an improper personal benefit.
Sections 60.391 and 60.407(2) of the Oregon Business Corporation Act
allow corporations to indemnify their directors and officers, respectively,
against liability where the director or officer has acted in good faith and with
a reasonable belief that actions taken were in the best interests of the
corporation or at least not opposed to the corporation's best interests and, if
in a criminal proceeding, the individual had no reasonable cause to believe the
conduct in question was unlawful. Under the Oregon Business Corporation Act,
corporations may not indemnify against liability in connection with a claim by
or in the right of the corporation or for any improper personal benefit in which
the director or officer was adjudged liable to the corporation. Sections 60.394
and 60.407(1) of the Oregon Business Corporation Act mandate indemnification of
directors and officers, respectively, for all reasonable expenses incurred in
the successful defense of any claim made or threatened, whether or not such
claim was by or in the right of the corporation. Finally, pursuant to the
Sections 60.401 and 60.407(1) of the Oregon Business Corporation Act, a court
may order indemnification in view of all the relevant circumstances, whether or
not the director or officer met the good-faith and reasonable belief standards
of conduct set out in Section 60.391 of the Oregon Business Corporation Act or
was adjudged liable to the corporation.
Section 60.414 of the Oregon Business Corporation Act also provides
that the statutory indemnification provisions are not deemed exclusive of any
other rights to which directors or officers may be entitled under a
corporation's articles of incorporation or bylaws, any agreement, general or
specific action of the board of directors, vote of shareholders or otherwise.
The Registrant's Amended and Restated Bylaws require indemnification of
directors and officers of the Registrant to the fullest extent not prohibited by
law. The Registration Rights Agreement (Exhibit 4.7 hereto) provides that the
selling shareholders will indemnify each director of the Registrant, each
officer of the Registrant and each person who controls the Registrant for
certain liabilities, including liabilities under the Securities Act.
II-1
ITEM 16. EXHIBITS
EXHIBIT NO. DESCRIPTION
----------- -----------
*4.1 Description of Capital Stock contained in the
Articles of Incorporation, as amended
@4.2 Description of Rights of Security Holders contained
in the Amended and Restated Bylaws
$4.3 Form of Certificate for Shares of Common Stock
$4.4 Form of Representatives' Warrant Agreement among the
Company, Cruttenden Roth and Black & Company, Inc.
#4.5 Securities Purchase Agreement dated as of January 28,
1999 among the Registrant and the Purchasers party
thereto
#4.6 Form of Callable Warrant
#4.7 Registration Rights Agreement dated as of January 28,
1999 among the Registrant and the Purchasers party
thereto
5.1 Opinion of Perkins Coie LLP, counsel to the
Registrant, regarding the legality of the Common
Stock
23.1 Consent of PricewaterhouseCoopers LLP, independent
auditors (included as page II-5)
23.2 Consent of Perkins Coie LLP (contained in Exhibit
5.1)
24.1 Power of Attorney (contained on signature page)
- --------------------------
* Incorporated by reference to Exhibit 3.1 to the Registration Statement on
Form SB-2 filed on January 5, 1995, as amended on February 7, 1995, and
February 24, 1995 (File No. 33-88252-LA).
@ Incorporated by reference to Exhibit 3.2 to the Company's Annual Report on
Form 10-K for the year ended December 31, 1996.
$ Incorporated by reference to the same exhibit number from the Registrant's
Registration Statement on Form SB-2 filed on January 5, 1995, as amended on
February 7, 1995, and February 24, 1995 (File No. 33-88252-LA).
# Incorporated by reference to the same exhibit number to the Company's
Current Report on form 8-K filed on February 16, 1999.
ITEM 17. UNDERTAKINGS
A. The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement 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;
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof; and
II-2
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
D. The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of prospectus
filed as part of this registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part
of this registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
II-3
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 Hillsboro, State of Oregon, on
March 3, 1999.
THRUSTMASTER, INC.
By: /s/ Frank G. Hausmann, Jr.
-------------------------------------
Frank G. Hausmann, Jr.
PRESIDENT AND CHIEF EXECUTIVE OFFICER
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints C.
Norman Winningstad and Frank G. Hausmann, Jr., either of whom may act without
the joinder of the other, as his true and lawful attorneys-in-fact and agents
with full power of substitution and resubstitution, for him, and in his name,
place and stead, in any and all capacities to sign any and all amendments
(including post-effective amendments) and supplements to this Registration
Statement and any registration statement for the same offering that is to be
effective upon filing pursuant to Rule 462(b) under the Securities Act of
1933, and to file the same, with all exhibits thereto, and all other
documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or their substitute or substitutes 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 indicated on March 3, 1999.
/s/ C. Norman Winningstad Chairman of the Board
- ----------------------------
C. Norman Winningstad
/s/ Frank G. Hausmann, Jr. Director, President, Chief Executive Officer
- ---------------------------- and Chief Financial Officer (principal
Frank G. Hausmann, Jr. executive and financial officer)
/s/ Allen Robison Controller (principal accounting officer)
- ----------------------------
Allen Robison
/s/ Robert L. Carter Director
- ----------------------------
Robert L. Carter
/s/ Graham E. Dorland Director
- ----------------------------
Graham E. Dorland
/s/ Merrill A. McPeak Director
- ----------------------------
Merrill A. McPeak
/s/ G. Gerald Pratt Director
- ----------------------------
G. Gerald Pratt
/s/ Milton R. Smith Director
- ----------------------------
Milton R. Smith
/s/ Frederick M. Stevens Director
- ----------------------------
Frederick M. Stevens
II-4
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report
dated January 23, 1998 appearing on page 20 of ThrustMaster, Inc.'s Annual
Report on Form 10-K for the year ended December 31, 1997. We also consent to
the reference to us under the heading "Experts" in such Prospectus.
/s/ PRICEWATERHOUSECOOPERS LLP
Portland, Oregon
March 3, 1999
II-5
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
*4.1 Description of Capital Stock contained in the Articles of
Incorporation, as amended
@4.2 Description of Rights of Security Holders contained in the
Amended and Restated Bylaws
$4.3 Form of Certificate for Shares of Common Stock
$4.4 Form of Representatives' Warrant Agreement among the
Company, Cruttenden Roth and Black & Company, Inc.
#4.5 Securities Purchase Agreement dated as of January 28, 1999
among the Registrant and the Purchasers party thereto
#4.6 Form of Callable Warrant
#4.7 Registration Rights Agreement dated as of January 28, 1999
among the Registrant and the Purchasers party thereto
5.1 Opinion of Perkins Coie LLP, counsel to the Registrant,
regarding the legality of the Common Stock
23.1 Consent of PricewaterhouseCoopers LLP, independent auditors
(included as page II-5)
23.2 Consent of Perkins Coie LLP (contained in Exhibit 5.1)
24.1 Power of Attorney (contained on signature page)
- --------------------------
* Incorporated by reference to Exhibit 3.1 from the Registration Statement on
Form SB-2 filed on January 5, 1995, as amended on February 7, 1995, and
February 24, 1995 (File No. 33-88252-LA).
@ Incorporated by reference to Exhibit 3.2 to the Company's Annual Report on
Form 10-K for the year ended December 31, 1996.
$ Incorporated by reference to the same exhibit number from the Registrant's
Registration Statement on Form SB-2 filed on January 5, 1995, as amended on
February 7, 1995, and February 24, 1995 (File No. 33-88252-LA).
# Incorporated by reference to the same exhibit number to the Company's
Current Report on form 8-K filed on February 16, 1999.
II-6