UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 2
TO
FORM 10-K
(Mark One)
/x/ Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the fiscal year ended March 31, 2002 or
/ / Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from to .
--------- --------
Commission file number: 0-27266
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WESTELL TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 36-3154957
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
750 N. COMMONS DRIVE
AURORA, ILLINOIS 60504
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (630) 898-2500
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act:
CLASS A COMMON STOCK, $.01 PAR VALUE
------------------------------------
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes /x/ No / /
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (ss.229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. / /
The registrant estimates that the aggregate market value of the registrant's
Class A Common Stock (including Class B Common Stock which automatically
converts into Class A Common Stock upon a transfer of such stock except
transfers to certain permitted transferees) held by non-affiliates (within the
meaning of the term under the applicable regulations of the Securities and
Exchange Commission) on June 21, 2002 (based upon an estimate that 70% of the
shares are so owned by non-affiliates and upon the average of the closing bid
and asked prices for the Class A Common Stock on the NASDAQ National Market on
that date) was approximately $66,805,760. Determination of stock ownership by
non-affiliates was made solely for the purpose of responding to this requirement
and registrant is not bound by this determination for any other purpose.
As of June 21, 2002, 45,907,065 shares of the registrant's Class A Common Stock
were outstanding and 19,014,869 shares of registrant's Class B Common Stock
(which automatically converts into Class A Common Stock upon a transfer of such
stock except transfers to certain permitted transferees) were outstanding.
EXPLANATION FOR AMENDMENT:
The Annual Report on Form 10-K of Westell Technologies, Inc. (the "Form
10-K") for the fiscal year ended March 31, 2002 is being filed with the SEC to
include the items required to be disclosed under Part III of the Form 10-K.
As originally filed, the Form 10-K incorporated the information required
by Part III by reference to the Company's proxy statement for its 2002 annual
meeting, as permitted by Instruction G(3). Because the proxy is not expected to
be filed with the SEC within 120 days of the end of Westell's fiscal year, Part
III of the Form 10-K is hereby being amended.
PART I EXECUTIVE OFFICERS OF THE REGISTRANT
The following sets forth certain information with respect to the
current executive officers of the Company. Please refer to the information
contained below under Part III, Item 10 for biographical information of
executive officers who are also directors of the Company.
Name Age Position
- --------------------------- --- --------------------------------------------
John W. Seazholtz.......... 66 Chairman of the Board of Directors
E. Van Cullens............. 56 President and Chief Executive Officer
Nicholas C. Hindman, Sr.... 51 Treasurer, Secretary, Senior Vice President
and Chief Financial Officer
William J. Noll............ 60 Senior Vice President of Product Development
and Chief Technology Officer
John C. Clark.............. 54 Senior Vice President of Operations
Richard P. Riviere......... 48 Senior Vice President of Transaction
Services and President and Chief
Executive Officer - Conference Plus, Inc.
Melvin J. Simon............ 57 Assistant Secretary, Assistant Treasurer and
Director
Nicholas C. Hindman, Sr. has served as Treasurer, Secretary, Vice
President and Chief Financial Officer since March, 2000 and as acting Treasurer,
Secretary, Vice President and Chief Financial Officer of the Company from May
1999 to February 2000. From October 1997 to April 1999, Mr. Hindman served as
General Manager of MFI Holdings, LLC, a manufacturer of consumer products. From
1992 through September 1997, Mr. Hindman operated an auditing and consulting
firm specializing in initial public offerings, private placement of securities
and business turnarounds.
John C. Clark has served as Senior Vice President of Operations since
April 2001. Prior to joining the Company, Mr. Clark was Vice President of
Manufacturing from September 1998 to October 2000 with 3COM. Mr. Clark was
Director of Material Management at US Robotics/3COM from January 1996 to
September 1998. From 1994 to 1996, Mr. Clark served as Area Vice President of
Operations for Caremark. He also served as Director of Materials Management for
Caremark from 1991 to 1996.
William J. Noll has served as Senior Vice President of Research and
Development and Chief Technology Officer of Westell, Inc. since May 1997. Prior
to joining the Company, Mr. Noll was Vice President and General Manager of
Residential Broadband at Northern Telecom from October 1995 to May 1997. Mr.
Noll held other various Vice President and Assistant Vice President positions at
Northern Telecom from June 1988 to October 1996, and was Vice President Network
Systems at Bell Northern Research from November 1986 to June 1988.
Richard P. Riviere has served as Vice President of Transaction Services
for the Company since July 1995 and as President, Chief Executive Officer and a
Director of the Company's 88% owned subsidiary Conference Plus, Inc. since
October 1988.
PART III.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The following table sets forth certain information with respect to
current members of the Board of Directors.
DIRECTOR PRINCIPAL OCCUPATION AND OTHER
NAME AND AGE SINCE INFORMATION
- ------------ ----- -------------------------------
John W. Seazholtz (66) 1997 John W. Seazholtz has served as
Director of the Company since
December 1997 and was elected
Chairman in April 2000. Mr.
Seazholtz was President and Chief
Executive Officer of Telesoft
America, Inc. from May 1998 to May
2000 In April 1998, Mr. Seazholtz
retired as Chief Technology Officer
- Bell Atlantic where he served
since June 1995. Mr. Seazholtz
previously served as Vice President
Technology and Information Services
- Bell Atlantic and in other
executive capacities with Bell
Atlantic beginning in 1962. Mr.
Seazholtz currently serves as a
Director for; Odetics, Inc., a
supplier of digital data management
products for the security, broadcast
and computer storage markets, and
for ASC-Advanced Switching
Communications, an ATM network
equipment developer and for Mariner,
Inc a ATM LAN CPE developer.
Melvin J. Simon (57) 1992 Melvin J. Simon has served as
Assistant Secretary and Assistant
Treasurer of the Company since July
1995 and as a Director of the
Company since August 1992. From
August 1992 to July 1995, Mr. Simon
served as Secretary and Treasurer of
the Company. A Certified Public
Accountant, Mr. Simon founded and
has served as President of Melvin J.
Simon & Associates, Ltd., a public
accounting firm, since May 1980. Mr.
Simon serves as a Director of the
Company's 88% owned subsidiary
Conference Plus, Inc.
Paul A. Dwyer (68) 1996 Paul A. Dwyer has served as a
Director of the Company since
January 1996 and as a Director of
Westell, Inc., a wholly owned
subsidiary of the Company, since
November 1995. Mr. Dwyer served as
Chief Financial Officer of Henry
Crown and Company, a private
investment firm from February 1981
to December 1999, and currently
serves as Vice President --
Administration of Longview
Management Group, LLC, a registered
investment advisor, since October
1998.
Robert C. Penny III (49) 1998 Robert C. Penny III has served as a
Director of the Company since
September 1998. He has been the
managing partner of P.F. Management
Co., a private investment company,
since May 1980.
Thomas A. Reynolds, III (51) 2000 Thomas A. Reynolds has served as
Director of the Company since
January 2000. He is a partner with
Winston & Strawn, an international
law firm headquartered in Chicago
and currently serves as a member of
the Board of Directors of Smurfit
Stone Container Corporation and
Georgetown University and serves as
a Trustee of the Brain Research
Foundation.
Bernard F. Sergesketter (66) 2000 Bernard F. Sergesketter has served
as a Director of the Company since
March 2000. Mr. Sergesketter is
President and Chief Executive
Officer of Sergesketter &
Associates, a telecommunications
consulting firm, since 1994. He
served as a Vice President of AT&T
from January 1993 to August 1994.
Mr. Sergesketter was a Director of
Teltrend, Inc, a wholly owned
subsidiary of the Company, from
January 1996 to March 2000 and
currently serves a Director of the
Illinois Institute of Technology,
The Mather Foundation and The Sigma
Chi Foundation.
E. Van Cullens (56) 2001 E. Van Cullens has served as
President, Chief Executive Officer
and Director of the Company since
July 2001. Prior to joining the
Company, Mr. Cullens operated
Cullens Enterprises, LLC, a
management consulting firm focused
in telecommunications, from June
2000 through June 2001. From June
1999 to May 2000, Mr. Cullens served
as President and Chief Operating
Officer of Harris Corporation and
served as President, Communications
Sector from May 1997 to June 1999.
Mr. Cullens served in various
executive capacities with Siemens A.
G. and affiliated companies from
January 1991 to April 1997.
Roger L. Plummer (60) 2001 Roger L. Plummer has served as a
Director of the Company since
September, 2001. Mr. Plumber
currently serves as the Managing
Director of the International
Engineering Consortium. Mr. Plummer
also serves as a consultant to
various communication technology
companies on corporate organization
and culture. Mr. Plummer previously
served in various executive
capacities at Ameritech and its
predecessor, Illinois Bell,
including President of the Ameritech
Custom Business Services unit, and
in various executive capacities at
AT&T. Mr. Plummer serves as a Board
member of: University of Illinois,
DePaul University, Chicago public
television Channel 11, Rush Hospital
Neurobehavioral Center and the
Chicago Symphony Orchestra.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires that the Company's officers and
directors and persons who own more than ten percent of the Company's outstanding
stock, file reports of ownership and changes in ownership with the Securities
and Exchange Commission. During fiscal 2002, to the knowledge of the Company,
all of these reporting persons have complied with the Section 16(a) filing
requirements.
ITEM 11. EXECUTIVE COMPENSATION
The following table sets forth information for the fiscal years ended March 31,
2000, 2001 and 2002, with respect to all compensation paid or earned for
services rendered to the Company by persons who served as the Company's Chief
Executive Officers during fiscal 2002 and the Company's four other most highly
compensated executive officers who were serving as executive officers at March
31, 2002 (together, the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
LONG TERM
ANNUAL COMPENSATION COMPENSATION
------------------- ------------
SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
FISCAL SALARY BONUS COMPENSATION OPTIONS(1) COMPENSATION(3)
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) (SHARES) ($)
- --------------------------- ---- --- --- --- -------- ---
E.Van Cullens 2002 344,898 200,000 217,182(2) 1,876,926 -
President and Chief 2001 - - - - -
Executive Officer 2000 - - - - -
J. William Nelson(4) 2002 311,233 123,702 - 181,007 3,500
Former Chief Executive Officer 2001 259,519 336,800 - 100,000 5,118
2000 244,038 298,080 - 195,000 7,624
John C. Clark 2002 234,519 2,500 - 122,632 -
Senior Vice President 2001 - - - - -
of Operations 2000 - - - - -
Nicholas C. Hindman, Sr. 2002 200,000 18,000 - 117,883 -
Treasurer, Secretary, Senior 2001 200,000 39,200 - - -
Vice President and Chief 2000 176,854 10,000 - 75,000 -
Financial Officer
William J. Noll 2002 222,000 143,600 - -
Senior Vice President of 2001 184,711 186,500 - 135,402 2,302
Research & Development and 2000 216,953 177,225 9,530(2) 85,750 3,127
Chief Technology Officer 25,000
Richard P. Riviere 2002 208,000 127,772 - - -
Vice President of Transaction 2001 196,712 120,442 - - -
Services Chief Executive 2000 172,000 150,831 - - 4,889
Officer of Conference Plus,
Inc.
- ------------------
(1) Stock options granted during fiscal 2002 were non-qualified stock options
of Class A Common Stock and were issued under the 1995 Stock Incentive Plan
of the Company.
(2) Represents reimbursed relocation expense and tax gross up.
(3) Represents matching contributions under the Company's 401(k) Profit Sharing
Plan for fiscal 2002.
(4) Mr. Nelson resigned from the Company effective July 2001 to pursue other
business interests. Compensation includes severance.
The following tables set forth the number of stock options granted to
each of the Named Executive Officers during fiscal 2002, the stock option
exercises and the exercisable and unexercisable stock options held by the Named
Executive Officers as of March 31, 2002. For purposes of table computations, the
fair market value of the Company's Class A Common Stock at March 31, 2002 was
equal to $1.54 per share, the closing sale price on the Nasdaq National Market
on March 31, 2002.
OPTION GRANTS IN THE LAST FISCAL YEAR
POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
RATE OF STOCK PRICE
APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(2)
----------------- ------------------
NUMBER OF PERCENT OF
SECURITIES TOTAL OPTIONS
UNDERLYING GRANTED TO EXERCISE OR
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION
NAME GRANTED(#) FISCAL YEAR(1) ($/SH) DATE 5% 10%
- ---- ---------- -------------- ------ ---- -- ---
E. Van Cullens 1,000,000(3) 17.46% 1.950 06/28/11 1,226,345 3,107,798
400,000(6) 6.98% 1.950 06/28/11 490,538 1,243,119
400,000(6) 6.98% 1.950 06/28/11 490,538 1,243,119
76,923(6) 1.34% 1.950 06/28/11 94,334 239,061
J. W. Nelson 100,000(5) 1.75% 1.120 04/10/11 70,736 178,499
81,007(6) 1.41% 2.185 05/30/11 111,315 285,093
Nicholas C. Hindman 75,000(5) 1.31% 2.120 04/10/11 99,994 253,405
20,000(4) .35% 1.135 09/19/11 14,276 36,178
22,883(6) .40% 2.185 05/30/11 31,444 79,686
William J. Noll 75,000(5) 1.31% 2.120 04/10/11 99,994 253,405
38,902(6) .68% 2.185 05/30/11 53,457 135,469
20,000(4) .35% 1.135 09/19/11 14,276 36,178
1,500(6) .03% 1.770 03/14/12 1,670 4,231
John C. Clark 50,000(4) .87% 2.110 04/16/11 66,348 168,140
52,632(6) .92% 2.185 05/30/11 72,323 183,282
20,000(4) .35% 1.135 09/19/11 14,276 36,178
Richard P. Riviere -- -- -- -- -- --
- ------------------
(1) Based on 5,726,973 total options granted to employees, including the Named
Executive Officers, in fiscal 2002.
(2) The potential realizable value is calculated based on the term of the
option at its time of grant (ten years). It is calculated
by assuming the stock price on the date of grant appreciates at the
indicated annual rate compounded annually for the entire term of the option
and that the option is exercised and sold on the last day of its term for
the appreciated stock price.
(3) These options vest over a four-year period with 25% vesting per year and
have a 10-year life subject to earlier termination upon the occurrence of
certain events related to termination of employment.
(4) These options vest over a five-year period with 20% vesting per year and
have a 10-year life subject to earlier termination upon the occurrence of
certain events related to termination of employment.
(5) These options vest over a five-year period with 5% vesting per quarter and
have a 10-year life subject to earlier termination upon the occurrence of
certain events related to termination of employment.
(6) These options are performance-based and vest in full at the earlier of
achievement of certain performance goals or eight years after grant date.
The options have a ten-year life subject to earlier termination upon the
occurrence of certain events related to termination of employment.
OPTION EXERCISES AND FISCAL YEAR-END VALUES
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES VALUE OPTIONS AT FISCAL YEAR END IN-THE-MONEY OPTIONS AT
ACQUIRED ON REALIZED (#) FISCAL YEAR END ($) E)
NAME EXERCISE (#) ($)(1) (EXERCISABLE/UNEXERCISABLE) (EXERCISABLE/UNEXERCISABL
- ---- ------------ ------ --------------------------- -------------------------
E. Van Cullens - - 0/1,876,926 -
John C. Clark - - 0/122,632 -/8,100
J. William Nelson 5,000 1,400 - -
William J. Noll - - 187,750/201,402 -/8,100
Nicholas C. Hindman - - 47,250/136,633 -/8,100
Richard P. Riviere - - 21,600/2,400 -
- ------------------
(1) Value is calculated by subtracting the exercise price per share from the
fair market value at the time of exercise and multiplying this amount by
the number of shares exercised pursuant to the stock option.
(2) Value is calculated by subtracting the exercise price per share from
$1.54, the fair market value of the Class A Common Stock at March 31, 2002,
and multiplying such amount by the number of shares subject to the option.
EXECUTIVE OFFICER AGREEMENTS
The Company has severance agreements with certain Named Executive
Officers of the Company. The severance agreements provide that in the event such
officer is terminated without Cause (as defined therein) or such officer resigns
for Good Reason (as defined therein), the Company shall pay to such officer
severance payments equal to such officer's salary and bonus for the fiscal year
in which the termination occurs, and the severance agreements also provide for
the payment of certain amounts upon the occurrence of certain events. The
executive officers entering into the severance agreements agreed not to compete
with the Company for one year in the event that their termination entitles them
to severance payments and not to solicit any Company employees for a period of
one year after a termination of such officer's employment with the Company. The
Company's severance payment obligations and an officer's right to this
additional bonus shall terminate upon such officer's death, resignation without
Good Reason, retirement or termination for Cause. Payments are being made
pursuant to these agreements for Mr. Nelson.
Pursuant to an agreement dated September 13, 1988 between the Company and
Richard Riviere, the Vice President of Transaction Services of the Company and
President of Conference Plus, Inc., a subsidiary of the Company, Mr. Riviere
receives an annual base salary of not less than $75,000 during his employment
with the Company. This agreement also provides Mr. Riviere with a right of first
refusal with respect to the Company's interest in Conference Plus in the event
the Company decides to sell such interest. In addition, after his employment
with the Company terminates, Mr. Riviere has agreed not to compete with the
Company for a period of two years.
DIRECTOR COMPENSATION
Directors who are not employees of the Company each receive $20,000 per year for
services rendered as directors, except Robert C. Penny III, who received no
compensation. In the fiscal year ended March 31, 2002, outside directors, except
for Robert C. Penny III and John W. Seazholtz were granted stock options to
purchase 25,000 shares that vest annually over four years. John Seazholtz was
granted stock options to purchase 35,000 shares that vest annually over four
years. In addition, all directors may be reimbursed for certain expenses
incurred in connection with attendance at Board and committee meetings. In
November 1995, Mr. Dwyer was granted an option to purchase 89,900 shares of
Class A Common Stock at an exercise price of $6.50 per share. Mr. Dwyer's
options vest at a rate of 1,872 shares per month commencing January 1, 1996. In
addition, Mr. Simon also receives $1,250 each quarter for his services as a
director of Conference Plus, Inc., a subsidiary of the Company. Other than as
described in this paragraph, directors who are employees of the Company do not
receive additional compensation for service as directors.
COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
The Compensation Committee is currently composed of Messrs. Dwyer
(Chair), Penny, Seazholtz and Simon, the Assistant Secretary and Assistant
Treasurer of the Company. No interlocking relationship exists between the
Company's Board of Directors or Compensation Committee and the board of
directors or compensation committee of any other company, nor has any such
interlocking relationship existed in the past.
Since 1984, Melvin J. Simon & Associates, Ltd. has provided accounting
and other financial services to the Company. Mr. Simon, a director and the
Assistant Secretary and Assistant Treasurer of the Company and Co-Trustee of the
Voting Trust, is the sole owner of Melvin J. Simon & Associates, Ltd. The
Company paid Melvin J. Simon & Associates, Ltd. approximately $15,475, $18,236
and $36,845 in fiscal 2000, 2001 and 2002, respectively, for its services. The
Company believes that these services are provided on terms no less favorable to
the Company than could be obtained from unaffiliated parties.
The Company has granted Robert C. Penny III and Melvin J. Simon, as
Trustees of the Voting Trust, certain registration rights with respect to the
shares of Common Stock held in the Voting Trust.
In June 2001, trusts for the benefit of Robert C. Penny III, a director
of the Company, and other Penny family members, entered into a guaranty of $10
million of the Company's obligations under its revolving credit facility. In
consideration of the guarantee, the Company has granted those trusts warrants to
purchase 512,820 shares of Class A Common Stock for a period of five years at an
exercise price of $1.95 per share (the fair market value on the date of grant)
and agreed to grant registration rights with respect to shares acquired upon
exercise.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial holdings (and the percentages of
outstanding shares represented by such beneficial holdings) as of July 23, 2002,
of (i) each person (including any "group" as defined in Section 13(d)(3) of the
Securities Exchange Act of 1934) known by the Company to own beneficially more
than 5% of either class of its outstanding Common Stock, (ii) each director,
(iii) each Named Executive Officer, and (iv) all directors and executive
officers as a group. Except as otherwise indicated, the Company believes that
the beneficial owners of the Common Stock listed below, based on information
provided by such owners, have sole investment and voting power with respect to
such shares, subject to community property laws where applicable. Under Rule
13d-3 of the Exchange Act, persons who have the power to vote or dispose of
Common Stock of the Company, either alone or jointly with others, are deemed to
be beneficial owners of such Common Stock.
STOCKHOLDERS, NUMBER OF NUMBER OF PERCENT OF PERCENT OF PERCENT OF
NAMED EXECUTIVE CLASS A CLASS B CLASS A CLASS B TOTAL VOTING
OFFICERS AND DIRECTORS SHARES(1)(2) SHARES(2) COMMON STOCK COMMON STOCK POWER(3)
- ---------------------- ------------ --------- ------------ ------------ --------
Robert C. Penny III........... -- 18,268,297(4) -- 96.1% 59.9%
Melvin J. Simon............... 180,500(5) 19,014,868(4)(6) * 100.0% 62.4%
State of Wisconsin
Investment Board(7)......... 8,536,559 -- 18.6% -- 6.9%
Becker Capital Management (8) 4,488,610 -- 9.8% -- 3.4%
Tocqueville Asset Management (9) 2,487,400 5.4%
Dimensional Fund Advisors Inc. (10) 2,361,880 5.1%
E. Van Cullens................ 352,192 -- * -- *
John W. Seazholtz............. 134,500 -- * -- *
J. William Nelson(11)......... 375,851 -- * -- *
Richard P. Riviere............ 21,600 -- * -- *
Nicholas C. Hindman, Sr....... 115,169 -- * -- *
William J. Noll............... 290,662 -- * -- *
John Clark.................... 51,763 -- * -- *
Paul A. Dwyer................. 172,400 -- * -- *
Bernard F. Sergesketter....... 52,200 -- * -- *
Thomas A. Reynolds III........ 166,500 -- * -- *
Roger L. Plummer.............. -- -- * -- *
All Directors and Executive
Officers as a group
(13 Persons)................ 1,913,337 19,014,868 4.1% 100.0% 63.9%
- ------------------
* Less than 1%
(1) Includes options to purchase shares that are exercisable within 60 days of
July 23, 2002 as follows: Mr. Cullens: 305,192; Mr. Simon: 139,000 shares;
Mr. Nelson: 25,000 shares; Mr. Noll: 290,662 shares; Mr. Dwyer: 150,400
shares; Mr. Seazholtz: 117,500 shares; Mr. Sergesketter: 52,200 shares; Mr.
Reynolds: 26,500 shares; Mr. Riviere: 21,600 shares; Mr. Hindman: 105,169;
Mr. John Clark: 51,763; and all directors and officers as a group:
1,284,986 shares.
(2) Holders of Class B Common Stock have four votes per share and holders of
Class A Common Stock have one vote per share. Class A Common Stock is
freely transferable and Class B Common Stock is transferable only to
certain transferees but is convertible into Class A Common Stock on a
share-for-share basis.
(3) Percentage of beneficial ownership is based on 45,907,065 of Class A Common
Stock and 19,014,869 shares of Class B Common Stock outstanding as of July
23, 2002.
(4) Includes 18,268,297 shares of Class B Common Stock held by Messrs. Penny
and Simon, as Trustees pursuant to a Voting Trust Agreement dated February
23, 1994, as amended (the "Voting Trust"), among Robert C. Penny III and
Melvin J. Simon, as trustees (the "Trustees"), and certain members of the
Penny family and the Simon family. The Trustees have joint voting and
dispositive power over all shares in the Voting Trust. Messrs. Penny and
Simon each disclaim beneficial ownership with respect to all shares held in
the Voting Trust in which they do not have a pecuniary interest. The Voting
Trust contains 5,469,636 shares held for the benefit of Mr. Penny and
437,804 shares held for the benefit of Mr. Simon. The address for Messrs.
Penny and Simon is Melvin J. Simon & Associates, Ltd., 4343 Commerce Court,
Suite 306, Lisle, Illinois 60532.
(5) Includes 9,500 shares held for the benefit of Stacy L. Simon, Melvin J.
Simon's daughter for which Natalie Simon, Mr. Simon's wife, is custodian
and has sole voting and dispositive power, and 2,000 shares held in trust
for the benefit of Makayla G. Penny, Mr. Penny's daughter, for which Mr.
Simon is trustee and has sole voting and dispositive power; Mr. Simon
disclaims beneficial ownership of these shares.
(6) Includes 95,980 shares held in trust for the benefit of Sheri A. Simon and
95,980 shares held in trust for Stacy L. Simon, Melvin J. Simon's
daughters, for which Natalie Simon, Mr. Simon's wife, is custodian and has
sole voting and dispositive power. Includes; 274,611 shares held in trust
for the benefit of Makayla G. Penny, 140,000 shares held in trust for the
benefit of EmmaLah Katelyn Penny, Mr. Penny's daughters, and 140,000 shares
held in trust for the benefit of Robert Clinton Penny IV, Mr. Penny's son,
for which Mr. Simon is trustee and has sole voting and dispositive power.
Mr. Simon disclaims beneficial ownership of these shares.
(7) The address for this stockholder is P.O. Box 7842, Madison, Wisconsin 53707.
(8) The Class A Common stock listed in the table are owned of record by clients
of Becker Capital Management, Inc. In its capacity as an investment
advisor, Becker Capital Management, Inc. may be deemed to beneficially own
the shares listed in the table. The address for this stockholder is 1211 SW
5th Avenue, Portland, Oregon 97204.
(9) The Class A Common stock listed in the table are owned of record by clients
of Becker Capital Management, Inc. In its capacity as an investment
advisor, Tocqueville Asset Management L.P. may be deemed to beneficially
own the shares listed in the table. The address for this stockholder is
1675 Broadway, New York, New York 10019.
(10) The Class A Common stock listed in the table are owned of record by clients
of Becker Capital Management, Inc. In its capacity as an investment
advisor, Dimensional Fund Advisors, Inc. may be deemed to beneficially own
the shares listed in the table. The address for this stockholder is 1299
Ocean Avenue, Santa Monica, California 90401.
(11) Mr. Nelson resigned in July 2001.
The following table gives information about our Company Stock that may be
issued upon the exercise of options under all of our existing equity
compensation plans as of March 31, 2002.
EQUITY COMPENSATION PLAN INFORMATION
NUMBER OF SECURITIES REMAINING
NUMBER OF SECURITIES WEIGHTED AVERAGE AVAILABLE FOR FUTURE ISSUANCE
TO BE ISSUED UPON EXERCISE PRICE OF UNDER EQUITY COMPENSATION PLANS
EXERCISE OF OUTSTANDING (EXCLUDING SECURITIES REFLECTED
PLAN CATEGORY OUTSTANDING OPTIONS(A) OPTIONS(B) IN COLUMN A)
- ------------- ---------------------- ---------- ------------
Equity compensation plan 9,218,128 $5.61 4,079,740
approved by security holders
Equity compensation plans None N/A N/A
not approved by security
holders
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Since 1984, Melvin J. Simon & Associates, Ltd. has provided accounting
and other financial services to the Company. Mr. Simon, a director and the
Assistant Secretary and Assistant Treasurer of the Company and Co-Trustee of the
Voting Trust, is the sole owner of Melvin J. Simon & Associates, Ltd. The
Company paid Melvin J. Simon & Associates, Ltd. approximately $15,475, $18,236
and $36,845 in fiscal 2000, 2001 and 2002, respectively, for its services. The
Company believes that these services are provided on terms no less favorable to
the Company than could be obtained from unaffiliated parties.
The Company has granted Robert C. Penny III and Melvin J. Simon, as
Trustees of the Voting Trust, certain registration rights with respect to the
shares of Common Stock held in the Voting Trust.
In June 2001, trusts for the benefit of Robert C. Penny III, a director
of the Company, and other Penny family members, entered into a guaranty of $10
million of the Company's obligations under its revolving credit facility. In
consideration of the guarantee, the Company has granted those trusts warrants to
purchase 512,820 shares of Class A Common Stock for a period of five years at an
exercise price of $1.95 per share (the fair market value on the date of grant)
and agreed to grant registration rights with respect to shares acquired upon
exercise.
The Company has certain severance agreements with certain Named
Executive Officer of the Company. See "Executive Compensation --Executive
Officer Agreements" under Item 11 above.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the registrant has duly caused this amendment to its
report on Form 10-K to be signed on its behalf by the undersigned, thereunto
duly authorized on July 30, 2002.
WESTELL TECHNOLOGIES, INC.
/s/ Nicholas C. Hindman
Chief Financial Officer