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January 24, 1996


The opinion of the court was delivered by: DALZELL

 Dalzell, J.

 January 24, 1996

 Disappointed investors filed three putative class action suits in this Court in connection with a public offering of Numerex Corporation ("Numerex") common stock. After we consolidated the cases under the above caption, plaintiffs filed an amended complaint alleging violations of the Securities Act of 1933. Defendants have moved to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). *fn1" For the reasons that follow, we shall grant the motion.

 I. Background

 A. Numerex Corporation

 The allegations of the consolidated amended complaint, which we assume to be true, are as follows. Numerex is a Pennsylvania corporation that designs, manufactures and markets its proprietary derived channel system ("DCS"), enabling telephone companies to transmit data to perform alarm reporting and other monitoring functions without interfering with regular voice communications. Cmplt. P 5a. Numerex's derived channel products include network equipment sold to telephone companies as well as related subscriber terminal units sold to alarm system distributors and installers for use at protected premises. Id. To complement its DCS business, Numerex also offers a family of intrusion alarm products, such as control panels and detection and communication devices, and a line of network management products used to test and monitor the performance of data and voice communication networks. Id.

 Since 1992, Numerex's revenues and profits significantly increased as a result of acquisitions and internal growth, primarily in its main United Kingdom market. Id. P 18. From 1992 to 1994, Numerex acquired several companies and the right to sell DCS technology (which had been responsible for Numerex's growth in the United Kingdom) in North and South America, the Pacific Rim and Eastern Europe. Id. PP 19-20. Although these acquisitions broadened its product lines and geographic markets, Numerex still derived the bulk of its revenues from the United Kingdom. Id. P 21. In fact, 55% of sales in 1993, 48.6% of sales in 1994 and 39.4% of sales in the first fiscal quarter ending January 31, 1995, were to a single customer, British Telecom. Id. Such sales consisted of network equipment that British Telecom deployed in connection with its RedCARE alarm reporting service to customers including McDonald's, Burger King, 7-Eleven, Thomas Cook and Barclays Bank. Id. So vital is its U.K. market that Numerex published its financial statements in British pounds sterling. Id.

 On December 19, 1994, Numerex announced its earnings and revenues for the fiscal year ending October 31, 1994. Id. P 22. Numerex reported that revenues more than doubled to $ 34,722,000 from $ 16,832,000 the prior year. Id. Net income and earnings per share for the year also increased to $ 9,622,000 and $ 1.01, from $ 4,029,000 and $ .57, respectively, from the prior year. Id. Numerex stated that these increases resulted from continued expansion of the U.K.-based DCS network and a related rise in the sales of subscriber terminal units and intrusion alarm products. Id. On February 28, 1995, Numerex reported "record results" for three months ending January 31, 1995, a quarter that historically "tends to be lower" than others. Id. P 23.

 On the same day that it released its quarterly financial information, Numerex announced that it had filed a registration statement for the public offering at issue in this case. Id. P 24.

 B. The Public Offering

 Before March 3, 1994, there had been no public market for Numerex shares. Cmplt. P 5b. From March 3, 1994 to April 20, 1995, only 312,500 shares of the 9,634,992 shares of Numerex stock outstanding were freely tradeable in the public NASDAQ small capital market, while the remaining 9,322,492 shares were restricted and did not trade. Id.

 On April 21, 1995, Numerex issued a registration statement, and a prospectus contained therein, for sale to the public of 3,750,000 shares of common stock at $ 15 per share. Id. P 2a. Numerex sold 1,875,000 shares and Gwynedd Resources, Ltd. ("Gwynedd") sold an equal number. *fn2" Id. P 2a. In addition, there was an over-allotment option of 562,500 shares. Id. Several Numerex officers and directors were signatories to the registration statement and are named as defendants. *fn3" The underwriting of the public offering was managed and syndicated by two securities broker/dealers, Prudential Securities Inc., the managing underwriter for the shares being offered in the United States and Canada, and Prudential-Bache Securities, the managing underwriter for shares sold elsewhere. Id. P 2b. The defendant underwriters ultimately sold 3,925,000 shares in the public offering. Id. P 2a.

 After April 21, 1995, the shares sold in the public offering and the 312,500 previously-traded shares were listed on the NASDAQ National Market System. Id. P 5c. Thus, of the 4,237,500 Numerex shares held in public hands, over 92.6% are directly traceable to the public offering. Id. Plaintiffs purchased Numerex common stock in the public offering pursuant to the registration statement and prospectus. *fn4" Id. PP 4a-d.

 On June 29, 1995, only two months after the public offering, defendant Eugene J. White, Numerex's Chairman of the Board since March of 1994 and its President and Chief Executive Officer since April of 1994, resigned from all of his positions with Numerex. Id. PP 8, 35. In his announcement, White stated, "after taking the Company public, completing three strategic acquisitions as well as successfully completing a recent public offering, it is time to move on." Id. P 35.

 On July 12, 1995, after the market had closed, Numerex announced that a temporary slowdown in business within the U.K. alarm industry had led to lower-than-expected demand for its derived channel products. Id. P 36. The next day, the price of Numerex common stock fell 31.9% from $ 11.375 to $ 7.75. *fn5" Id. P 39. Trading on volume of 769,400 shares was more than eight times heavier than the prior three days' average. Id.

 The day after this precipitous drop in the price of Numerex stock, the first suit was filed. Gross v. Numerex Corp., No. 95-4378 (filed July 14, 1995). *fn6"

 II. Analysis

 Count I of the two-count consolidated amended complaint alleges violations of § 11 *fn7" of the Securities Act of 1933 against Numerex, the officers who signed the registration statement, the underwriters, and Gwynedd Resources, Ltd., and violations of § 15 *fn8" against the individual defendants and Gwynedd. Count II claims violations of § 12(2) *fn9" against Numerex, Gwynedd and the underwriters and violations of § 15 against the individual defendants and Gwynedd. Notably, plaintiffs do not allege that defendants acted with the intent to defraud them in violation of § 10(b) of the Securities Act of 1934. Cf. In re U.S. Bioscience Secs. Litig., 806 F. Supp. 1197, 1201 (E.D. Pa. 1992).

 Defendants have, as noted, moved to dismiss, contending that (1) no material misrepresentations exist as a matter of law because the forward-looking statements in the prospectus are not actionable (a) under the "bespeaks caution" doctrine, (b) as mere "puffing", or (c) as claims for mismanagement; (2) the complaint fails to allege adequately that defendants are statutory "sellers" under § 12(2); and (3) the consolidated amended complaint fails to satisfy the particularity requirement of Federal Rule of Civil Procedure 9(b).

 The Supreme Court has identified the distinguishing features of a cause of action under § 11 of the 1933 Act:

Section 11 of the 1933 Act allows purchasers of a registered security to sue certain enumerated parties in a registered offering when false or misleading information is included in a registration statement. The section was designed to assure compliance with the disclosure provisions of the Act by imposing a stringent standard of liability on the parties who play a direct role in a registered offering. If a plaintiff purchased a security issued pursuant to a registration statement, he need only show a material misstatement or omission to establish his prima facie case. Liability against the issuer of a security is virtually absolute, even for innocent misstatements. Other defendants bear the burden of demonstrating due diligence.

 Herman & MacLean v. Huddleston, 459 U.S. 375, 381-82, 74 L. Ed. 2d 548, 103 S. Ct. 683 (1983) (footnotes omitted). In contrast, "under § 12(2) of the Securities Act of 1933 buyers have an express cause of action for rescission against sellers who make material misstatements or omissions 'by means of a prospectus.'". Gustafson v. Alloyd Co., Inc., 131 L. Ed. 2d 1, 115 S. Ct. 1061, 1064 (1995). This provision applies only to initial distributions and not to securities purchased on the after-market. 115 S. Ct. at 1074; Ballay v. Legg Mason Wood Walker, Inc., 925 F.2d 682, 692-93 (3d Cir.), cert. denied, 502 U.S. 820, 116 L. Ed. 2d 52, 112 S. Ct. 79 (1991). Section 15, in turn, imposes liability upon a "controlling person" who has direct or indirect ...

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