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As Filed with the Securities and Exchange Commission on June 8, 2000
Registration No. 333-32846
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Post-Effective Amendment No. 1
on
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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COPPER MOUNTAIN NETWORKS, INC.
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Delaware 000-25865 33-0702004
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(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or organization) Classification Code Number) Identification Number)
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2470 Embarcadero Way
Palo Alto, CA 94303
(650) 687-3300
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
RICHARD S. GILBERT
President and Chief Executive Officer
COPPER MOUNTAIN NETWORKS, INC.
2470 Embarcadero Way
Palo Alto, CA 94303
(650) 687-3300
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies to:
LANCE W. BRIDGES, ESQ.
ELIZABETH E. REED, ESQ.
Cooley Godward LLP
4365 Executive Drive, Suite 1100
San Diego, California 92121
(858) 550-6000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From Time
to Time After the Effective Date of this Registration Statement.
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If any of the securities being registered on this form are to be offered on
a delayed or continuous bases pursuant to Rule 415 under the Securities Act of
1933, 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, check the following box and
list the Securities Act registration statement number of earlier effective
registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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1,142,293 Shares
[LOGO OF COPPER MOUNTAIN NETWORKS, INC.]
The selling stockholders identified in this prospectus are selling 1,142,293
shares of our common stock. All of the shares being offered in this prospectus
were issued to the selling stockholders in connection with our acquisition of
OnPREM Networks Corporation. We are not selling any shares of our common stock
under this prospectus and will not receive any of the proceeds from the sale of
shares by the selling stockholders.
Our common stock is traded on the Nasdaq National Market under the symbol
"CMTN". On June 7, 2000, the last reported sales price for our common stock was
$91.63 per share.
The selling stockholders may sell the shares of common stock described in
this prospectus in a number of different ways and at varying prices. We provide
more information about how the selling stockholders may sell their shares in
the section titled "Plan of Distribution" on page 20.
Investing in our common stock involves a high degree of risk. See "Risk
Factors" beginning on page 3 to read about risks that you should consider
before buying shares of our common stock.
The shares offered or sold under this prospectus have not been approved by
the Securities and Exchange Commission or any state securities commission nor
have any of these organizations determined that this prospectus is accurate or
complete. Any representation to the contrary is a criminal offense.
The date of this Prospectus is , 2000.
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TABLE OF CONTENTS
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Page
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Prospectus Summary......................................................... 1
Risk Factors............................................................... 3
Special Note Regarding Forward-Looking Statements.......................... 15
Use of Proceeds............................................................ 15
Principal and Selling Stockholders......................................... 16
Plan of Distribution....................................................... 20
Legal Matters.............................................................. 20
Experts.................................................................... 20
Where You Can Find More Information........................................ 21
Incorporation By Reference................................................. 21
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PROSPECTUS SUMMARY
You should read this summary together with the more detailed information and
financial statements and notes appearing elsewhere in this prospectus. You
should carefully consider, among other things, the matters set forth in "Risk
Factors."
THE COMPANY
Copper Mountain is a leading supplier of high-speed digital subscriber line,
or DSL, based communications products. Our solutions enable telecommunications
service providers to provide high-speed, cost-effective connectivity over the
existing copper wire telephone infrastructure to the business, multi-tenant
unit and residential markets. We believe there is significant demand for high-
speed data access services, especially among business users who have found
current solutions to be inadequate or too expensive.
The emergence of electronic commerce, business usage of web-based
communications, remote access for teleworkers, applications hosting and other
services have generated enormous traffic for the existing communications
infrastructure. While there are a number of alternatives to deliver high-
bandwidth connectivity, we believe that none has the cost, performance and
coverage advantages of using the existing copper wire telephone infrastructure.
DSL is a technology that was developed to enable telecommunications service
providers to exploit this existing infrastructure to provide guaranteed,
dedicated bandwidth at a low cost to virtually all businesses and homes in the
United States.
Telecommunications service providers are seeking vendors that have
effectively incorporated DSL into communications equipment solutions enabling
them to offer cost-effective, full-coverage, high-bandwidth data access
services. Our flexible, scalable solution consists of the following products:
CopperEdge DSL access concentrators, CopperRocket DSL customer premise
equipment, and CopperView network management tools. Our products offer the
following benefits:
. Support for Business Applications. Our products enable
telecommunications service providers to deliver business services such
as high-speed Internet access, corporate networking, teleworking and
packet-based voice solutions.
. Full Coverage DSL. Our symmetric DSL and ISDN DSL-based products allow
our telecommunications service provider customers the flexibility and
range to reach their targeted customers.
. Multi-Vendor Customer Premise Equipment Interoperability. We have
partnered with third-party DSL customer premise equipment manufacturers
through our CopperCompatible program to develop a broad line of modems,
routers and other innovative customer premise equipment that is
compatible with our CopperEdge DSL access concentrators.
. Trouble Free Operations. Our products are designed to reduce
installation and support requirements for our customers while allowing
large scale central-office based deployment of DSL solutions with a
zero-installation "plug and play" DSL customer premise equipment that
eliminates complex configuration issues for the end user.
. Support for Multiple Services. Our platform is a highly-scalable and
cost-effective platform that addresses the strong demand for Internet
access services. In addition, the CopperEdge products maximize return on
investment through support of value added Frame Relay, VPN and voice
services. Unlike most DSL access multiplexer platforms, the Copper Edge
solution delivers advanced packet processing, class of service using
weighted fair queuing, and subscriber aggregation to support multiple
simultaneous services.
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Our objective is to be the leading supplier of DSL solutions to
telecommunications service providers. We will focus on expanding our presence
in the business and multi-tenant building markets. In addition, we will address
the emerging opportunities developing in the residential market as
telecommunications service providers seek to offer DSL services to residential
subscribers seeking high-speed access. As this trend toward broad deployment of
DSL services evolves, we anticipate significant opportunities for us to deploy
new offerings, such as our recently introduced G. Lite Line Card, that
leverages both our technology and our relationships with service providers.
Finally, we are working to drive interoperability of DSL technology to
facilitate faster and broader market acceptance.
We sell our products primarily through a direct sales force and selected
original equipment manufacturers and distributors to telecommunications service
providers. As of December 31, 1999, we have sold over 4,600 CopperEdge DSL
access concentrators. We have also formed strategic relationships with Lucent
Technologies Inc. and 3Com Corporation to allow us to expand our distribution
and market presence. In addition, to facilitate faster and broader market
acceptance of our solutions, we have promoted a "CopperCompatible" program
through which we offer licenses of our DSL customer premise equipment
technology to other manufacturers of customer premise equipment.
On February 29, 2000 we completed our acquisition of OnPREM Networks
Corporation, which we refer to in this prospectus as OnPREM. OnPREM is a
developer of highly integrated DSL solutions for the small and medium building
multi-tenant unit, or MTU, market whose products compliment our existing MTU
product, the CopperEdge 150, or CE150. We believe that our acquisition of
OnPREM will enable us to provide enhanced services to our customers.
We were incorporated in California in 1996 and reincorporated in Delaware in
1999. Our principal executive offices are located at 2470 Embarcadero Way, Palo
Alto, California 94303, and our telephone number is (650) 687-3300.
THE OFFERING
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Common stock offered by Copper Mountain............ 0 shares
Common stock offered by the selling stockholders... 1,142,293 shares
Common stock to be outstanding after the offering.. 50,451,092 shares
Use of proceeds.................................... We will not receive any
proceeds from the sale of
common stock by the
selling stockholders
Nasdaq National Market symbol...................... CMTN
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The foregoing information is based upon shares outstanding as of April 30,
2000.
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Except as otherwise indicated, all information in this prospectus has been
adjusted to reflect the 100% stock dividend that was distributed to our
stockholders on December 10, 1999, also referred to herein as a 2-for-1 stock
split.
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RISK FACTORS
You should carefully consider the following risk factors and the other
information in this prospectus before investing in our common stock. Our
business and results of operations could be seriously harmed by any of the
following risks. The trading price of our common stock could decline due to any
of these risks, and you may lose part or all of your investment.
Copper Mountain Has a History of Losses and May Not Sustain Annual
Profitability
We anticipate continuing to incur significant sales and marketing, research
and development and general and administrative expenses and, as a result, we
will need to generate significantly higher revenues to sustain profitability on
an annual basis. Although our revenue has grown in recent quarters, we cannot
be certain that our revenue growth will continue or increase in the future or
that we will realize sufficient revenues to sustain profitability on an annual
or quarterly basis.
Copper Mountain Derives Almost All of Its Revenues From a Small Number of
Customers and Copper Mountain's Revenues May Decline Significantly if Any Major
Customer Cancels or Delays a Purchase of Copper Mountain's DSL Products
Copper Mountain sells its products predominantly to competitive local
exchange carriers. Aggregate sales to our three largest customers accounted for
approximately 88% of our net revenue for the year ended December 31, 1999.
Sales to our most significant customers NorthPoint Communications, Inc.,
Rhythms NetConnections, Inc., and Lucent Technologies, Inc. accounted for
approximately 37%, 28%, and 23% of Copper Mountain's net revenue, respectively,
for the year ended December 31, 1999. Aggregate sales to our four largest
customers accounted for approximately 83% of our net revenue for the three
months ended March 31, 2000. Sales to our most significant customers NorthPoint
Communications, Inc., Lucent Technologies, Inc., Rhythms NetConnections, Inc.,
and DSL.NET accounted for approximately 29%, 29%, 13%, and 12% of Copper
Mountain's net revenue, respectively, for the three months ended March 31,
2000. Accordingly, unless and until we diversify and expand our customer base,
our future success will significantly depend upon the timing and size of future
purchase orders, if any, from our largest customers and, in particular:
. the product requirements of these customers;
. the financial and operational success of these customers; and
. the success of these customers' services deployed using our products.
The loss of any one of our major customers or the delay of significant
orders from such customers, even if only temporary, could among other things
reduce or delay our recognition of revenue, harm our reputation in the
industry, and reduce our ability to accurately predict cash-flow, and, as a
consequence, could materially adversely affect our business, financial
condition and results of operations.
Copper Mountain Has a Limited Operating History
Copper Mountain has a very limited operating history as we were incorporated
in March 1996. Due to our limited operating history, it is difficult or
impossible for us to predict future results of operations and you should not
expect future revenue growth to be comparable to our recent revenue growth. In
addition, we believe that comparing different periods of our operating results
is not meaningful, as you should not rely on the results for any period as an
indication of our future performance. Investors in our common stock must
consider our business and prospects in light of the risks and difficulties
typically encountered by companies in their early stages of development,
particularly those in rapidly evolving markets such as the telecommunications
equipment industry. Some of the specific risks include whether we are able:
. to compete in the intensely competitive market for telecommunications
equipment;
. to expand our sales, support and distribution organization;
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. to effectively introduce new products and product enhancements in a
timely and competitive fashion; and
. to expand our operational infrastructure.
We discuss these and other risks in more detail below.
A Number of Factors Could Cause Copper Mountain's Operating Results to
Fluctuate Significantly and Cause Its Stock Price to be Volatile
Copper Mountain's quarterly and annual operating results have fluctuated in
the past and are likely to fluctuate significantly in the future due to a
variety of factors, many of which are outside of its control. If our quarterly
or annual operating results do not meet the expectations of securities analysts
and investors, the trading price of our common stock could significantly
decline. Some of the factors that could affect our quarterly or annual
operating results include:
. the timing and amount of, or cancellation or rescheduling of, orders for
our products and services, particularly large orders from our key
customers and original equipment manufacturers;
. our ability to develop, introduce, ship and support new products and
product enhancements and manage product transitions;
. announcements, new product introductions and reductions in price of
products offered by our competitors;
. a decrease in the average selling prices of our products;
. our ability to achieve cost reductions;
. our ability to obtain sufficient supplies of sole or limited source
components for our products;
. changes in the prices of our components;
. our ability to maintain production volumes and quality levels for our
products;
. the volume and mix of products sold and the mix of distribution channels
through which they are sold;
. the loss of any one of our major customers or a significant reduction in
orders from those customers;
. increased competition, particularly from larger, better capitalized
competitors;
. fluctuations in demand for our products and services;
. costs relating to possible acquisitions and integration of technologies
or businesses; and
. telecommunications and DSL market conditions and economic conditions
generally.
Historically, our backlog at the beginning of each quarter has not been
equal to expected revenue for that quarter. Accordingly, we are dependent upon
obtaining orders in a quarter for shipment in that quarter to achieve our
revenue objectives. In addition, due in part to factors such as the timing of
product release dates, purchase orders and product availability, significant
volume shipments of product could occur at the end of our quarter. Failure to
ship products by the end of a quarter may adversely affect our operating
results. Furthermore, our customers may delay delivery schedules or cancel
their orders without notice. Due to these and other factors, quarterly revenue,
expenses and results of operations could vary significantly in the future, and
period-to-period comparisons should not be relied upon as indications of future
performance.
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Copper Mountain Sells the Majority of Its Products to Emerging
Telecommunications Service Providers That May Reduce or Discontinue Their
Purchase of Copper Mountain's Products At Any Time
The customers of Copper Mountain's products to date have predominantly been
telecommunications service providers. The market for the services provided by
telecommunications service providers who compete against traditional telephone
companies has only begun to emerge since the passage of the Telecom Act, and
many of these service providers are still building their infrastructure and
rolling out their services. These telecommunications service providers require
substantial capital for the development, construction and expansion of their
networks and the introduction of their services. Financing may not be available
to emerging telecommunications service providers on favorable terms, if at all.
The inability of our current or potential emerging telecommunications service
provider customers to acquire and keep customers, to successfully raise needed
funds, or to respond to any other trends such as price reductions for their
services or diminished demand for telecommunications services generally, could
adversely affect their operating results or cause them to reduce their capital
spending programs. If our customers are forced to defer or curtail their
capital spending programs, our sales to those telecommunication service
providers may be adversely affected, which would have a material adverse effect
on our business, financial condition and results of operations. In addition,
many of the industries in which telecommunications service providers operate
have recently experienced consolidation. The loss of one or more of our
telecommunications service provider customers, through industry consolidation
or otherwise, could reduce or eliminate our sales to such a customer and
consequently have a material adverse effect on our business, financial
condition and results of operations.
If DSL Technology and Copper Mountain's DSL Product Offerings Are Not Accepted
by Telecommunications Service Providers, Copper Mountain May Not Be Able to
Sustain or Grow Its Business
Copper Mountain's future success is substantially dependent upon whether DSL
technology gains widespread market acceptance by telecommunications service
providers, of which there are a limited number, and end users of their
services. We have invested substantial resources in the development of DSL
technology, and all of our products are based on DSL technology.
Telecommunications service providers are continuously evaluating alternative
high-speed data access technologies and may, at any time, adopt technologies
other than the DSL technologies offered by Copper Mountain. Even if
telecommunications service providers adopt policies favoring full-scale
implementation of DSL technology, they may not choose to purchase our DSL
product offerings. In addition, we have limited ability to influence or control
decisions made by telecommunications service providers. In the event that the
telecommunications service providers to whom we market our products adopt
technologies other than the DSL technologies offered by Copper Mountain or
choose not to purchase Copper Mountain's DSL product offerings, we may not be
able to sustain or grow our business.
Unless Copper Mountain Is Able to Keep Pace With the Rapidly Changing Product
Requirements of Its Customers, It Will Not Be Able to Sustain or Grow Its
Business
The telecommunications and data communications markets are characterized by
rapid technological advances, evolving industry standards, changes in end-user
requirements, frequent new product introductions and evolving offerings by
telecommunications service providers. We believe our future success will
depend, in part, on our ability to anticipate or adapt to such changes and to
offer, on a timely basis, hardware and software products which meet customer
demands. Our inability to develop on a timely basis new products or
enhancements to existing products, or the failure of such new products or
enhancements to achieve market acceptance, could materially adversely affect
our business, financial condition and results of operations.
Copper Mountain's Product Cycles Tend to be Short and Copper Mountain May Incur
Substantial Non-Recoverable Expenses or Devote Significant Resources to Sales
That Do Not Occur When Anticipated
In the rapidly changing technology environment in which we operate, product
cycles tend to be short. Therefore, the resources we devote to product sales
and marketing may not generate revenue for us and from
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time to time we may need to write-off excess and obsolete inventory. In the
past, we have experienced such write-offs attributed to the obsolescence of
certain printed circuit boards. If we incur substantial sales, marketing and
inventory expenses in the future that we are not able to recover, it could have
a material adverse effect on our business, financial condition and results of
operations.
Copper Mountain's Ability to Sustain or Grow Its Business May Be Harmed if It
Is Unable to Develop and Maintain Certain Strategic Relationships with Third
Parties to Market and Sell Copper Mountain's Products
Copper Mountain's success will be substantially dependent upon its strategic
partnerships, including its original equipment manufacturer agreements with
Lucent Technologies, Inc. and 3Com Corporation under which we have agreed to
manufacture, and sell our products to Lucent and 3Com. The amount and timing of
resources which our strategic partners devote to our business is not within our
control. Our strategic partners may not perform their obligations as expected.
Agreements with our strategic partners are relatively new, and we cannot be
certain that we will be able to sustain the level of revenue generated thus far
under these strategic arrangements. If any of our strategic partners breaches
or terminates its agreement or fails to perform its obligations under its
agreement, we may not be able to sustain or grow our business. In the event
that these relationships are terminated, we may not be able to continue to
maintain or develop strategic relationships or to replace strategic partners.
In addition, any strategic agreements we enter into in the future may not be
successful.
In June 1999, Lucent completed the acquisition of Ascend Communications,
Inc., a competitor of ours, which offers a competing DSL solution.
Subsequently, in September 1999, Lucent announced a new DSL product based on
technology acquired from Ascend. As a result, Lucent may seek to reduce the
marketing and/or sales of our products in favor of their own competitive
products. We expect that the availability to Lucent of these alternative
products will expose Copper Mountain to increased competition from Lucent.
Because of this competition, we expect sales to Lucent, both in terms of
dollars and as a percent of sales, will decline over time. In addition, our
other customers may elect to purchase alternative products from Lucent and
reduce their future purchases of Copper Mountain products.
Intense Competition in the Market for Telecommunications Equipment Could
Prevent Copper Mountain From Increasing or Sustaining Revenue and Prevent
Copper Mountain From Sustaining Annual Profitability
The market for telecommunications equipment is highly competitive. We
compete directly with the following companies: Nokia Corporation, Alcatel S.A,
Cisco Systems, Inc., Lucent Technologies, Inc., and Paradyne Corporation, among
others. If we are unable to compete effectively in the market for DSL
telecommunications equipment, our revenue and future profitability could be
materially adversely affected. Many of our current and potential competitors
have significantly greater selling and marketing, technical, manufacturing,
financial, and other resources, including vendor-sponsored lease financing
programs. Moreover, our competitors may foresee the course of market
developments more accurately than we do and could in the future develop new
technologies that compete with our products or even render our products
obsolete. Although we believe we presently have certain technological and other
advantages over our competitors, realizing and maintaining such advantages will
require a continued high level of investment in research and development,
marketing and customer service and support. Due to the rapidly evolving markets
in which we compete, additional competitors with significant market presence
and financial resources, including other large telecommunications equipment
manufacturers, may enter those markets, thereby further intensifying
competition. We may not have sufficient resources to continue to make the
investments or achieve the technological advances necessary to compete
successfully with existing competitors or new competitors. Also, to the extent
we introduce new product offerings intended to capitalize on the anticipated
trend toward broad deployment of DSL services, including DSL services targeted
at residential subscribers seeking high-speed access to public communications
networks, we will encounter new competitors such as coaxial cable and wireless
equipment vendors. Even if we are successful in competing in the business DSL
market, we may not be able to compete successfully in the market for
residential subscribers.
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Future Consolidation in the Telecommunications Equipment Industry May Increase
Competition That Could Harm Copper Mountain's Business
The markets in which Copper Mountain competes are characterized by
increasing consolidation both within the data communications sector and by
companies combining or acquiring data communications assets and assets for
delivering voice-related services. We cannot predict with certainty how
industry consolidation will affect our competitors. We may not be able to
compete successfully in an increasingly consolidated industry. Increased
competition and consolidation in our industry, including the future effects of
Lucent's acquisition of Ascend, could require that we reduce the prices of our
products and result in our loss of market share, which would materially
adversely affect our business, financial condition and results of operations.
Additionally, because we are now, and may in the future be, dependent on
certain strategic relationships with third parties in our industry, any
additional consolidation involving these parties could reduce the demand for
our products and otherwise harm our business prospects.
Copper Mountain May Experience Difficulties in the Introduction of New Products
That Could Result in Copper Mountain Having to Incur Significant Unexpected
Expenses or Delay the Launch of New Products
Copper Mountain intends to continue to invest in product and technology
development. The development of new or enhanced products is a complex and
uncertain process requiring the accurate anticipation of technological and
market trends. We may experience design, manufacturing, marketing and other
difficulties that could delay or prevent our development, introduction or
marketing of new products and enhancements. The introduction of new or enhanced
products also requires that we manage the transition from older products in
order to minimize disruption in customer ordering patterns and ensure that
adequate supplies of new products can be delivered to meet anticipated customer
demand. In the future, we expect to develop certain new products, such as new
DSL Concentrators, line cards for different DSL variants and new types of
customer premise equipment. We may not successfully develop, introduce or
manage the transition of these new products. Furthermore, products such as
those we currently offer may contain undetected or unresolved errors when they
are first introduced or as new versions are released. Despite testing, errors
may be found in new products or upgrades after commencement of commercial
shipments. These errors could result in:
. delays in or loss of market acceptance and sales;
. diversion of development resources;
. injury to our reputation; and
. increased service and warranty costs.
Any of these could materially adversely affect our business, financial
condition and results of operations.
Copper Mountain Is Dependent on Widespread Market Acceptance of Its Products
Widespread market acceptance of Copper Mountain's products is critical to
its future success. Factors that may affect the market acceptance of our
products include market acceptance of DSL technology in particular, the
performance, price and total cost of ownership of our products, the
availability and price of competing products and technologies and the success
and development of our resellers, original equipment manufacturers and field
sales channels. Many of these factors are beyond our control. The introduction
of new and enhanced products may cause certain customers to defer or return
orders for existing products. Although we maintain reserves against such
returns, such reserves may not be adequate. We cannot be certain that we will
not experience delays in product development in the future. Failure of our
existing or future products to maintain and achieve meaningful levels of market
acceptance would materially adversely affect our business, financial condition
and results of operations.
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Because Substantially All of Copper Mountain's Revenue is Derived From Sales of
a Small Number of Products, Its Future Operating Results Will Be Dependent on
Sales of These Products
Copper Mountain currently derives substantially all of its revenues from its
product family of DSL solutions and expects that this concentration will
continue in the foreseeable future. The market may not continue to demand our
current products, and we may not be successful in marketing any new or enhanced
products. Any reduction in the demand for our current products or our failure
to successfully develop or market and introduce new or enhanced products could
materially adversely affect our operating results and cause the price of our
common stock to decline. Factors that could affect sales of our current or new
or enhanced products include:
. the demand for DSL solutions;
. our successful development, introduction and market acceptance of new
and enhanced products that address customer requirements;
. product introductions or announcements by our competitors;
. price competition in our industry and between DSL and competing
technologies; and
. rate of technological change in the market for broadband solutions.
Copper Mountain's Limited Ability to Protect Its Intellectual Property May
Adversely Affect Its Ability to Compete
Copper Mountain's success and ability to compete is dependent in part upon
its proprietary technology. Any infringement of our proprietary rights could
result in significant litigation costs, and any failure to adequately protect
our proprietary rights could result in our competitors offering similar
products, potentially resulting in loss of a competitive advantage and
decreased revenues. We rely on a combination of copyright, trademark and trade
secret laws, as well as confidentiality agreements and licensing arrangements,
to establish and protect our proprietary rights. Despite our efforts to protect
our proprietary rights, existing copyright, trademark and trade secret laws
afford only limited protection. In addition, the laws of certain foreign
countries do not protect our proprietary rights to the same extent as do the
laws of the United States. Attempts may be made to copy or reverse engineer
aspects of our products or to obtain and use information that we regard as
proprietary. Accordingly, we may not be able to protect our proprietary rights
against unauthorized third-party copying or use. Furthermore, policing the
unauthorized use of our products is difficult. Litigation may be necessary in
the future to enforce our intellectual property rights, to protect our trade
secrets or to determine the validity and scope of the proprietary rights of
others. Such litigation could result in substantial costs and diversion of
resources and could have a material adverse effect on our future operating
results.
Claims Against Copper Mountain Alleging Its Infringement of a Third Party's
Intellectual Property Could Result in Significant Expense to Copper Mountain
and Result in Its Loss of Significant Rights
The telecommunications industry is characterized by the existence of a large
number of patents and frequent litigation based on allegations of patent
infringement. From time to time, third parties may assert patent, copyright,
trademark and other intellectual property rights to technologies that are
important to our business. Any claims asserting that our products infringe or
may infringe proprietary rights of third parties, if determined adversely to
us, could have a material adverse effect on our business, financial condition
or results of operations. In addition, in our agreements, we agree to indemnify
our customers for any expenses or liabilities resulting from claimed
infringements of patents, trademarks or copyrights of third parties. As the
number of entrants in our market increases and the functionality of our
products is enhanced and overlaps with the products of other companies, we may
become subject to claims of infringement or misappropriation of the
intellectual property rights of others. Any claims, with or without merit,
could be time-consuming, result in costly litigation, divert the efforts of our
technical and management personnel, cause product shipment delays or require us
to enter into royalty or licensing agreements, any of which could have a
material adverse effect
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upon our operating results. Such royalty or licensing agreements, if required,
may not be available on terms acceptable to us, if at all. Legal action
claiming patent infringement may be commenced against us. We cannot assure you
that we would prevail in such litigation given the complex technical issues and
inherent uncertainties in patent litigation. In the event a claim against us
was successful and we could not obtain a license to the relevant technology on
acceptable terms or license a substitute technology or redesign our products to
avoid infringement, our business, financial condition and results of operations
would be materially adversely affected.
If Copper Mountain Loses Key Personnel It May Not Be Able to Successfully
Operate Its Business
Copper Mountain's success depends to a significant degree upon the continued
contributions of the principal members of its sales, engineering and management
personnel, many of whom perform important management functions and would be
difficult to replace. Specifically, we believe that our future success is
highly dependent on our senior management. Except for agreements with our
President and Chief Executive Officer, Chief Technology Officer, and Vice
President of Engineering, we do not have employment contracts with our key
personnel. In any event, employment contracts would not prevent key personnel
from terminating their employment with Copper Mountain. The loss of the
services of any key personnel, particularly senior management and engineers,
could materially adversely affect our business, financial condition and results
of operations.
If Copper Mountain is Unable to Retain and Hire Additional Qualified Personnel
As Necessary, It May Not Be Able to Successfully Achieve Its Objectives
Copper Mountain has experienced growth in revenues and expansion of its
operations which have placed significant demands on its management, engineering
staff and facilities. We have recently hired additional engineering, sales,
marketing, customer support and administrative personnel. Continued growth will
also require us to hire more engineering, sales and administrative personnel.
We may not be able to attract and retain the necessary personnel to accomplish
our business objectives and we may experience constraints that will adversely
affect our ability to satisfy customer demand in a timely fashion or to support
our customers and operations. We have at times experienced, and continue to
experience, difficulty in recruiting qualified personnel. Recruiting qualified
personnel is an intensely competitive and time-consuming process.
In addition, companies in the telecommunications industry whose employees
accept positions with competitors frequently claim that such competitors have
engaged in unfair hiring practices. We received one such notice from another
company and, although to date this notice has not resulted in litigation, we
may receive other notices in the future as we seek to hire qualified personnel
and such notices may result in material litigation. We could incur substantial
costs in defending ourselves against any such litigation, regardless of the
merits or outcome of such litigation.
Failure to Manage the Growth of Copper Mountain's Operations Will Adversely
Affect Its Business
Copper Mountain has rapidly and significantly expanded its operations and
anticipates that further significant expansion will be required to address
potential growth in its client base and market opportunities if it is
successful in implementing its business strategy. We may not be able to
implement management information and control systems in an efficient and timely
manner, and our current or planned personnel, systems, procedures and controls
may not be adequate to support our future operations. If we are unable to
manage growth effectively, our business, financial condition and results of
operations will be materially adversely affected. During 1999, we increased the
number of employees from 111 to 240. During the first quarter of 2000, we
increased the number of employees from 240 to 301. This expansion is placing a
significant strain on our managerial and operational resources. Most of our
existing senior management personnel joined us within the last two years,
including a number of key managerial, technical and operations personnel. We
expect to add additional key personnel in the near future, including direct
sales and marketing personnel. To manage the expected growth of our operations
and personnel, we will be required to:
9
<PAGE>
. improve existing systems and controls and implement new operational,
financial and management controls, reporting systems and procedures;
. install new management information systems; and
. train, motivate and manage our sales and marketing, engineering,
technical and customer support employees.
. expand our physical infrastructure and facilities to accommodate growth
in our headcount.
As of March 31, 2000 we operated our business from facilities in Palo Alto,
California, Fremont, California and San Diego, California. We face challenges
related to effectively and efficiently coordinating our operations between
these facilities. If we are unsuccessful in meeting these challenges, our
business and operating results may be adversely affected.
Copper Mountain's Dependence on Sole and Single Source Suppliers Exposes It to
Supply Interruption
Although Copper Mountain generally uses standard parts and components for
its products, certain key components are purchased from sole or single source
vendors for which alternative sources are not currently available. The
inability to obtain sufficient quantities of these components may in the future
result in delays or reductions in product shipments which could materially
adversely affect our business, financial condition and results of operations.
We presently purchase three key components from vendors for which there are
currently no substitutes: two semiconductor chips and a system control module.
We are evaluating alternate source vendors for each of these key components,
but any alternate vendors may not meet our quality standards for component
vendors. In the event of a reduction or interruption of supply of any such
components, as much as nine months could be required before we would begin
receiving adequate supplies from alternative suppliers, if any. It is possible
that a source may not be available for us or be in a position to satisfy our
production requirements at acceptable prices and on a timely basis, if at all.
In addition, the manufacture of certain of these single or sole source
components is extremely complex, and our reliance on the suppliers of these
components exposes us to potential production difficulties and quality
variations, which could negatively impact cost and timely delivery of our
products. Any significant interruption in the supply, or degradation in the
quality, of any component could have a material adverse effect on our business,
financial condition and results of operations.
Copper Mountain's Dependence on Independent Manufacturers Could Result in
Product Delivery Delays
Copper Mountain currently uses a small number of independent manufacturers
to provide certain printed circuit boards, chassis and subassemblies and, in
certain cases, to complete final assembly and testing of our products. Our
reliance on independent manufacturers involves a number of risks, including the
absence of adequate capacity, the unavailability of or interruptions in access
to certain process technologies and reduced control over delivery schedules,
manufacturing yields and costs. Additionally, Flextronics International, Ltd.
located in Fremont, California is our main source of independent contract
manufacturing. If Flextronics or any of our current manufacturers are unable or
unwilling to continue manufacturing our product or components in required
volumes, it could take up to eight months for an alternative manufacturer to
supply the needed components in sufficient volumes. It is possible that a
source may not be available to us when needed or be in a position to satisfy
our production requirements at acceptable prices and on a timely basis, if at
all. Any significant interruption in supply would result in the allocation of
products to customers, which in turn could have a material adverse effect on
our business, financial condition and results of operations. Moreover, since
all of our final assembly and tests are performed in one location, any fire or
other disaster at our assembly facility would have a material adverse effect on
our business, financial condition and results of operations.
10
<PAGE>
Intense Demand Within the Telecommunications Industry for Parts and Components
May Create Allocations or Shortages Which May Expose Copper Mountain to Supply
Interruption
From time to time, the demand in the telecommunications industry for parts
and components, including semiconductors, programmable devices and printed
circuit boards can be intense. During these periods manufacturers and suppliers
who provide such components to us experience supply shortages which may in turn
affect their ability to meet our production demands. While we seek to enter
into contracts with our suppliers which guarantee adequate supplies of
components for the manufacturing of our products, we cannot be certain that
suppliers will always be able to adequately meet our demands. To date, we have
not experienced any shortages of components or parts which have impacted our
ability to meet the shipment requirements of our customers. However, in the
event that we receive allocations of components from our suppliers or
experience outright interruption in the supply of components we could
experience an inability to ship or deliver our products to our customers in a
timely fashion. Any significant allocation of or interruption in the supply of
any component could have a material adverse effect on our business, financial
condition and results of operations.
Copper Mountain's Customers May Demand Preferential Terms or Delay Copper
Mountain's Sales Cycle, Which May Result in Operating Losses for Copper
Mountain
Many of Copper Mountain's customers tend to be larger than Copper Mountain
and are able to exert a high degree of influence over Copper Mountain. They
have sufficient bargaining power to demand low prices and other terms and
conditions that may materially adversely affect our business, financial
condition and results of operations. In addition, prior to selling our products
to such customers, we must typically undergo lengthy product approval
processes, often taking up to one year. Accordingly, we are continually
submitting successive versions of our products as well as new products to our
customers for approval. The length of the approval process can vary and is
affected by a number of factors, including customer priorities, customer
budgets and regulatory issues affecting telecommunication service providers.
Delays in the product approval process could materially adversely affect our
business, financial condition and results of operations. While we have been
successful in the past in obtaining product approvals from our customers, such
approvals and the ensuing sales of such products may not continue to occur.
Delays can also be caused by late deliveries by other vendors, changes in
implementation priorities and slower than anticipated growth in demand for the
services that our products support. A delay in, or cancellation of, the sale of
our products could result in operating losses and cause our results of
operations to vary significantly from quarter to quarter.
Changes to Regulations Affecting the Telecommunications Industry Could Reduce
Demand for Copper Mountain's Products or Adversely Affect Its Results of
Operations
Any changes to legal requirements relating to the telecommunications
industry, including the adoption of new regulations by federal or state
regulatory authorities under current laws or any legal challenges to existing
laws or regulations relating to the telecommunications industry could have a
material adverse effect upon the market for Copper Mountain's products.
Moreover, our distributors or telecommunications service provider customers may
require, or we may otherwise deem it necessary or advisable, that we modify our
products to address actual or anticipated changes in the regulatory
environment. Our inability to modify our products or address any regulatory
changes could have a material adverse effect on our business, financial
condition or results of operations.
Copper Mountain's Failure to Comply with Regulations and Evolving Industry
Standards Could Delay Its Introduction of New Products
The market for Copper Mountain's products is characterized by the need to
meet a significant number of communications regulations and standards, some of
which are evolving as new technologies are deployed. In order to meet the
requirements of our customers, our products may be required to comply with
various regulations including those promulgated by the Federal Communications
Commission, or FCC, and standards
11
<PAGE>
established by Underwriters Laboratories and Bell Communications Research.
Failure of our products to comply, or delays in compliance, with the various
existing and evolving industry regulations and standards could delay the
introduction of our products. Moreover, enactment by federal, state or foreign
governments of new laws or regulations, changes in the interpretation of
existing laws or regulations or a reversal of the trend toward deregulation in
the telecommunications industry could have a material adverse effect on our
customers, and thereby materially adversely affect our business, financial
condition and results of operations.
Copper Mountain May Not Be Able to Obtain Additional Capital to Fund Its
Operations When Needed
Our capital requirements depend on several factors, including the rate of
market acceptance of our products, the ability to expand our client base, the
growth of our product lines and other factors. If capital requirements vary
materially from those currently planned, we may require additional financing
sooner than anticipated. If additional funds are raised through the issuance of
equity securities, the percentage ownership of our stockholders will be
reduced, stockholders may experience additional dilution, or such equity
securities may have rights, preferences or privileges senior to those of the
holders of our common stock. If additional funds are raised through the
issuance of debt securities, such securities would have rights, preferences and
privileges senior to holders of common stock and the terms and conditions
relating to such debt could impose restrictions on our operations. Additional
financing may not be available when needed on terms and conditions favorable to
us or at all. If adequate funds are not available or are not available on
acceptable terms and conditions, we may be unable to develop or enhance our
services, take advantage of future opportunities or respond to competitive
pressures, which could materially adversely affect our business, financial
condition or results of operations.
If Copper Mountain's Products Contain Defects, Copper Mountain May Be Subject
to Significant Liability Claims from Its Customers and the End-Users of Its
Products and Incur Significant Unexpected Expenses and Lost Sales
Copper Mountain's products have in the past contained, and may in the future
contain, undetected or unresolved errors when first introduced or as new
versions are released. Despite extensive testing, errors, defects or failures
may be found in our current or future products or enhancements after
commencement of commercial shipments. If this happens, we may experience delay
in or loss of market acceptance and sales, product returns, diversion of
development resources, injury to our reputation or increased service and
warranty costs, any of which could have a material adverse effect on our
business, financial condition and results of operations. Moreover, because our
products are designed to provide critical communications services, we may
receive significant liability claims. Our agreements with customers typically
contain provisions intended to limit our exposure to liability claims. These
limitations may not, however, preclude all potential claims resulting from a
defect in one of our products. Although we maintain product liability insurance
covering certain damages arising from implementation and use of our products,
our insurance may not cover any claims sought against us. Liability claims
could require us to spend significant time and money in litigation or to pay
significant damages. As a result, any such claims, whether or not successful
could seriously damage our reputation and our business.
Copper Mountain May Engage in Future Acquisitions That Dilute Its Stockholders,
Cause It to Incur Debt and Assume Contingent Liabilities
As part of Copper Mountain's business strategy, we expect to review
acquisition prospects that would complement our current product offerings,
augment our market coverage or enhance our technical capabilities, or that may
otherwise offer growth opportunities. We may acquire businesses, products or
technologies in the future. In the event of such future acquisitions, we could:
. issue equity securities which would dilute current stockholders'
percentage ownership;
. incur substantial debt; or
. assume contingent liabilities.
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<PAGE>
Such actions by us could materially adversely affect our results of
operations and/or the price of our common stock. Acquisitions also entail
numerous risks, including:
. difficulties in assimilating acquired operations, technologies or
products;
. unanticipated costs associated with the acquisition could materially
adversely affect our results of operations;
. diversion of management's attention from other business concerns;
. adverse effects on existing business relationships with suppliers and
customers;
. risks of entering markets in which we have no or limited prior
experience; and
. potential loss of key employees of acquired organizations.
We may not be able to successfully integrate any businesses, products,
technologies or personnel that we might acquire in the future, and our failure
to do so could have a material adverse effect on our business, financial
condition and results of operations.
In February 2000, we acquired OnPREM Networks Corporation. We operate in a
sector of the DSL equipment industry that is considerably different from the
sector for which OnPREM is developing its products. It may turn out that there
are no advantages or "synergies" to adding OnPREM's proposed products to our
product line. Moreover, there is no assurance that OnPREM's operations can be
successfully integrated into our operations or that all of the benefits
expected from the acquisition of OnPREM will be realized. Furthermore, there
can be no assurance that the operations, management and personnel of the two
companies will be compatible or that we or OnPREM will not experience the loss
of key personnel following the merger.
Copper Mountain Plans to Expand its Operations Into International Markets.
Copper Mountain's Failure to Effectively Manage its International Operations
Could Harm its Business.
We believe that international market opportunities for our products may be
significant and we plan to enter markets outside the United States in 2000.
Entering new international markets may require significant management attention
and expenditures and could adversely affect our operating margins and earnings.
In order to commence and expand our international operations, we will need to
hire additional personnel and develop relationships with potential
international customers. To the extent that we are unable to do so on a timely
basis, our growth in international markets would be limited, and our business
could be harmed.
We expect that our international business operations will be subject to a
number of material risks, including, but not limited to:
. difficulties in building and managing foreign operations;
. difficulties in enforcing agreements and collecting receivables through
foreign legal systems and addressing other legal issues;
. longer payment cycles;
. taxation issues;
. fluctuations in the value of foreign currencies; and
. unexpected changes in the international regulatory, economic or
political environments.
Control by a Small Number of Stockholders May Limit the Ability of Other
Stockholders to Influence the Outcome of Director Elections and Other Matters
Requiring Stockholder Approval
Copper Mountain's executive officers, directors and principal stockholders
and their affiliates beneficially own approximately 11.7% of the outstanding
shares of common stock as of April 30, 2000. These
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<PAGE>
stockholders, if acting together, would be able to significantly influence all
matters requiring approval by our stockholders, including the election of
directors and the approval of mergers or other business combination
transactions. This concentration of ownership could have the effect of delaying
or preventing a change in our control or otherwise discouraging a potential
acquirer from attempting to obtain control of us, which in turn could have a
material adverse effect on the market price of the common stock or prevent our
stockholders from realizing a premium over the market prices for their shares
of common stock.
Copper Mountain's stock price has been and may continue to be extremely
volatile
The trading price of our common stock has been and is likely to continue to
be extremely volatile. Our stock price could be subject to wide fluctuations in
response to a variety of factors, including the following:
. actual or anticipated variations in quarterly operating results;
. announcements of technological innovations;
. new products or services offered by us or our competitors;
. changes in financial estimates by securities analysts;
. announcements of significant acquisitions, strategic partnerships, joint
ventures or capital commitments by us or our competitors;
. additions or departures of key personnel;
. announcements or loss of strategic relationships with third parties or
telecommunications equipment providers by us or our competitors;
. sales of common stock; and
. other events or factors, many of which are beyond our control.
In addition, the stock market in general, and the Nasdaq National Market and
technology companies in particular, have experienced extreme price and volume
fluctuations that have often been unrelated or disproportionate to the
operating performance of such companies. The trading prices of many technology
companies' stocks are at or near historical highs and these trading prices and
multiples are substantially above historical levels. These trading prices and
equity valuations may not be sustained. These broad market and industry factors
may materially adversely affect the market price of our common stock,
regardless of our actual operating performance. In the past, following periods
of volatility in the market price of a company's securities, securities class-
action litigation has often been instituted against such companies. Such
litigation, if instituted, could result in substantial costs and a diversion of
management's attention and resources, which would materially adversely affect
our business, financial condition and results of operations.
Substantial Future Sales of Copper Mountain's Common Stock in the Public Market
Could Cause Its Stock Price to Fall
Sales of a large number of shares of Copper Mountain's common stock in the
public market or the perception that such sales could occur could cause the
market price of its common stock to drop. As of April 30, 2000, we had 50.5
million shares of common stock outstanding. We filed two registration
statements on Form S-8 with the Securities and Exchange Commission covering the
14.5 million shares of common stock reserved for issuance under our 1996 Equity
Incentive Plan, 1999 Non-Employee Directors' Stock Option Plan and 1999
Employee Stock Purchase Plan, the OnPREM 1998 Stock Option Plan and for options
issued outside such plans. In addition, we expect to file a registration
statement on Form S-8 covering the 600,000 shares authorized under our 2000 NSO
plan. As of March 31, 2000, at least 1.7 million shares are subject to
immediately exercisable options. Sales of a large number of shares could have
an adverse effect on the market price for our common stock.
14
<PAGE>
Certain Provisions in Copper Mountain's Corporate Charter and Bylaws May
Discourage Take-Over Attempts and Thus Depress the Market Price of Our Stock
Provisions in Copper Mountain's certificate of incorporation may have the
effect of delaying or preventing a change of control or changes in its
management. These provisions include:
. the right of the board of directors to elect a director to fill a
vacancy created by the expansion of the board of directors;
. the ability of the board of directors to alter our bylaws without
getting stockholder approval;
. the ability of the board of directors to issue, without stockholder
approval, up to 5,000,000 shares of preferred stock with terms set by
the board of directors; and
. the requirement that at least 10% of the outstanding shares are needed
to call a special meeting of stockholders.
Each of these provisions could discourage potential take-over attempts and
could adversely affect the market price of our common stock.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements. These statements relate
to future events or our future financial performance. In some cases, you can
identify forward-looking statements by terminology such as "may," "will,"
"should," "except," "plan," "anticipate," "believe," "estimate," "predict,"
"potential" or "continue," the negative of such terms or other comparable
terminology. These statements are only predictions. Actual events or results
may differ materially. In evaluating these statements, you should specifically
consider various factors, including the risks outlined under "Risks Factors."
These factors may cause our actual results to differ materially from any
forward-looking statement.
Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements. Moreover, neither we nor any other
person assumes responsibility for the accuracy and completeness of the forward-
looking statements. We are under no duty to update any of the forward-looking
statements after the date of this prospectus to conform such statements to
actual results or to changes in our expectations.
USE OF PROCEEDS
We will not receive any proceeds from sales, if any, of our common stock by
the selling stockholders. The purpose of this offering is to register our
common stock for resale by the selling stockholders.
15
<PAGE>
PRINCIPAL AND SELLING STOCKHOLDERS
Except as indicated, the following table sets forth information known to us
with respect to the beneficial ownership of our common stock as of April 30,
2000 and as adjusted to reflect the sale of common stock in this offering for:
. each person who we know to own beneficially more than five percent of
our outstanding common stock;
. each of our directors;
. certain of our executive officers;
. all of our directors and executive officers as a group; and
. each selling stockholder.
In connection with our acquisition of OnPREM Networks Corporation, we agreed
to register common stock for those stockholders for resale. We are unable to
determine the exact number of shares that actually have been or will be sold.
The information provided in the table below with respect to each selling
stockholder has been obtained from such selling stockholder.
Except as indicated, and subject to community property laws where
applicable, the persons named have sole voting and investment power with
respect to all shares shown as beneficially owned by them. Percentage of
beneficial ownership is based on 50,451,092 shares of common stock outstanding
as of April 30, 2000.
<TABLE>
<CAPTION>
Shares Beneficially
Number of Number of Owned After This
Shares Shares Offering (2)
Beneficially Being --------------------
Name and Address of Beneficial Owner Owned (1) Percentage Offered (2) Number Percentage
------------------------------------ ------------ ---------- ----------- --------- ----------
<S> <C> <C> <C> <C> <C>
Roger Evans(3)........................... 260,840 * -- 260,840 *
(Greylock Equity Limited Partnership)
Tench Coxe(4)............................ 360,446 * -- 360,446 *
(Sutter Hill Ventures)
Andrew W. Verhalen(5).................... 165,049 * -- 165,049 *
(Matrix Partners IV, L.P.)
Richard H. Kimball(6).................... 571,888 1.13% -- 571,888 1.13%
(Technology Crossover Ventures II, L.P.)
Joseph D. Markee(7)...................... 1,249,835 2.48% -- 1,249,835 2.48%
Mark Handzel(8).......................... 1,238,354 2.45% -- 1,238,354 2.45%
Richard Gilbert(9)....................... 660,299 1.30% -- 660,299 1.30%
Steve Hunt(10)........................... 503,750 1.00% -- 503,750 1.00%
Mike Kelly(11)........................... 237,713 * -- 237,713 *
Raymond V. Thomas(12).................... 60,000 * -- 60,000 *
Robert L. Bailey(13)..................... 66,000 * -- 66,000 *
All directors and officers as a group
(17 persons) (14)....................... 6,044,449 11.69% -- 6,044,449 11.69%
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
Shares
Beneficially
Number of Number of Owned After This
Shares Shares Offering (2)
Beneficially Being -----------------
Name and Address of Beneficial Owner Owned (1) Percentage Offered (2) Number Percentage
------------------------------------ ------------ ---------- ----------- ------ ----------
<S> <C> <C> <C> <C> <C>
Sabine Austin............................... 641 * 641 0 *
Charles A. Blanchard(25).................... 1,259 * 1,259 0 *
Rolf Brauchler.............................. 5,646 * 5,646 0 *
Edward F. and Sherril S. Brennan, JTWS(24).. 1,679 * 1,679 0 *
Wilson O. Cochran, II(15)................... 45,087 * 39,072 6,015 *
Casey E. Cox................................ 128,319 * 128,319 0 *
Les Denend.................................. 320 * 320 0 *
Satish Gune................................. 641 * 641 0 *
William Ingram(16).......................... 2,406 * 2,138 268 *
Steven M. and Neal B. Johnson............... 5,373 * 5,373 0 *
Tenants in Common(25)
Katz Financial Services Ltd.(25)............ 2,566 * 2,566 0 *
Steven Langham.............................. 320 * 320 0 *
David Laone(17)............................. 641 * 449 192 *
James Lawson(18)............................ 1,470 * 1,002 468 *
Mark L. Ludwig and Debby R. Ludwig Trustees,
Mark Lawrence Ludwig Revocable Trust U/A/D
10/30/98(25)............................... 6,760 * 6,760 0 *
David M. Marshall........................... 64 * 64 0 *
George D. Marshall(26)...................... 122,025 * 122,025 0 *
Lois F. Marshall............................ 6,415 * 6,415 0 *
Paul J. Marshall............................ 64 * 64 0 *
Sharon K. Marshall.......................... 6,415 * 6,415 0 *
Philip Monin(19)............................ 641 * 427 214 *
ML-Montclair Capital Fund, LLC(25).......... 13,000 * 13,000 0 *
Vic Para.................................... 5,645 * 5,645 0 *
John E. Parkey(25).......................... 1,679 * 1,679 0 *
Chris Robbins(20)........................... 949 * 684 265 *
Steven Santos (21).......................... 427 * 213 214 *
Randolph M. Selig(25)....................... 5,500 * 5,500 0 *
Ramadoss Venkatesan(22)..................... 8,553 * 6,415 2,138 *
James S. Acquistapace....................... 29,415 * 29,415 0 *
Paul J. Ake................................. 3,645 * 3,645 0 *
Charles Giancarlo........................... 22,123 * 22,123 0 *
John Lee(23)................................ 72,908 * 72,908 0 *
Robert Leppo(26)............................ 137,266 * 137,266 0 *
Marla Lipsky................................ 4,977 * 4,977 0 *
Robert R. Lux............................... 3,936 * 3,936 0 *
Charles S. Mitchell......................... 2,916 * 2,916 0 *
Anthony P. Russo, Trustee................... 5,037 * 5,037 0 *
Anthony P. Russo Separate
Property Trust WA 9/11/90(25)
Amit Shah................................... 11,061 * 11,061 0 *
Thomas A. Skornia........................... 11,061 * 11,061 0 *
Richard White(26)........................... 75,630 * 75,630 0 *
CIBC Bank and Trust Co. Limited as Trustee
of Trust T304 (Randall Rose)............... 72,908 * 72,908 0 *
Salomon Smith Barney Tax Advantaged Exchange
Fund III, LLC(25).......................... 10,796 * 10,796 0 *
</TABLE>
17
<PAGE>
<TABLE>
<CAPTION>
Shares
Beneficially
Number of Number of Owned After This
Shares Shares Offering (2)
Name and Address of Beneficial Beneficially Being -----------------
Owner Owned (1) Percentage Offered (2) Number Percentage
------------------------------ ------------ ---------- ---------- ------ ----------
<S> <C> <C> <C> <C> <C>
SBIC Partners II, L.P. .......... 109,362 * 109,362 0 *
Tallac Corporation(24)........... 72,908 * 72,908 0 *
Tredegar Investments, Inc. (25).. 74 * 74 0 *
TGI Fund III, LLC(26)............ 174,124 * 174,124 0 *
The Selig Capital Group.......... 7,061 * 7,061 0 *
</TABLE>
--------
* Represents beneficial ownership of less than 1%.
(1) The number of shares beneficially owned by each stockholder is determined
under rules promulgated by the SEC, and the information is not necessarily
indicative of beneficial ownership for any other purpose. Under such
rules, beneficial ownership includes any shares as to which the individual
or entity has sole or shared voting power or investment power and any
shares as to which the individual or entity has the right to acquire
beneficial ownership within 60 days after April 30, 2000 through the
exercise of any stock option or other right. The inclusion herein of such
shares, however, does not constitute an admission that the named
stockholder is a direct or indirect beneficial owner of, or receives the
economic benefit from, such shares.
(2) Assumes the sale by the selling stockholders of all of the shares of
Copper Mountain common stock issued in connection with the acquisition of
OnPREM Networks Corporation.
(3) Mr. Evans is a general partner of the general partner of Greylock Equity
Limited Partnership.
(4) Includes 15,092 shares held in Mr. Coxe's Keogh account, and 60,000 shares
issuable upon exercise of options exercisable within 60 days of April 30,
2000. Mr. Coxe is a managing director of the general partner of Sutter
Hill Ventures.
(5) Includes 5,182 shares held by entities affiliated with Matrix Partners IV,
L.P. and 60,000 shares issuable upon exercise of options held by Mr.
Verhalen exercisable within 60 days of April 30, 2000. Mr. Verhalen is a
general partner of Matrix Partners IV, L.P.
(6) Includes:
. 6,359 shares held by TCV II, V.O.F., which represent less than 1% of
total shares before and after this offering;
. 195,773 shares held by Technology Crossover Ventures II, L.P. which
represent less than 1% of total shares before and after this
offering;
. 150,511 shares held by TCV II (Q), L.P. which represent less than 1%
of total shares before and after this offering;
. 26,712 shares held by TCV II Strategic Partners, L.P. which
represent less than 1% of total shares before and after this
offering;
. 29,891 shares held by Technology Crossover Ventures II, C.V. which
represent less than 1% of total shares before and after this
offering; and
. 60,000 shares issuable upon exercise of options held by Mr. Kimball
exercisable within 60 days of April 30, 2000.
Mr. Kimball, a director of Copper Mountain, is a managing member of the
general partner of each of these entities.
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<PAGE>
(7) Includes 19,656 shares of common stock held by Teresa L. Boley, Mr.
Markee's spouse, 15,000 shares issuable upon exercise of options
exercisable within 60 days of April 30, 2000.
(8) Includes 10,000 shares issuable upon exercise of options exercisable
within 60 days of April 30, 2000.
(9) Includes 525,033 shares issuable upon exercise of options exercisable
within 60 days of April 30, 2000.
(10) Includes 173,750 shares of common stock issuable upon exercise of options
exercisable within 60 days of April 30, 2000.
(11) Includes 27,325 shares issuable upon exercise of options exercisable
within 60 days of April 30, 2000.
(12) Includes 60,000 shares issuable upon exercise of options exercisable
within 60 days of April 30, 2000.
(13) Includes 60,000 shares issuable upon exercise of options exercisable
within 60 days of April 30, 2000.
(14) Includes 1,233,886 shares subject to options exercisable within 60 days of
April 30, 2000.
(15) Includes 6,015 shares issuable upon exercise of options exercisable within
60 days of April 30, 2000.
(16) Includes 268 shares issuable upon exercise of options exercisable within
60 days of April 30, 2000.
(17) Includes 192 shares issuable upon exercise of options exercisable within
60 days of April 30, 2000.
(18) Includes 468 shares issuable upon exercise of options exercisable within
60 days of April 30, 2000.
(19) Includes 214 shares issuable upon exercise of options exercisable within
60 days of April 30, 2000.
(20) Includes 265 shares issuable upon exercise of options exercisable within
60 days of April 30, 2000.
(21) Includes 214 shares issuable upon exercise of options exercisable within
60 days of April 30, 2000.
(22) Includes 2,138 shares issuable upon exercise of options exercisable within
60 days of April 30, 2000.
(23) Includes 21,872 shares of common stock held by Tallac Corporation. Mr. Lee
is the president of Tallac Corporation.
(24) Includes 51,036 shares of common stock held by John Lee. Mr. Lee is the
president of Tallac Corporation.
(25) Represents number of shares acquired pursuant to a transfer or
distribution from another selling stockholder after April 30, 2000. With
respect to such selling stockholder, we are unable to determine the number
of shares of our common stock beneficially held by it other than the
shares being offered by this Prospectus.
(26) Represents number of shares beneficially held subsequent to a transfer or
distribution effective after April 30, 2000.
19
<PAGE>
PLAN OF DISTRIBUTION
The shares of common stock offered by the selling stockholders, or by their
pledgees, transferees or other successors in interest, may be sold from time to
time to purchasers directly by any of the selling stockholders acting as
principal for its own account in one or more transactions at a fixed price,
which may be changed, or at varying prices determined at the time of sale or at
negotiated prices. Alternatively, any of the selling stockholders may from time
to time offer the common stock through underwriters, dealers or agents who may
receive compensation in the form of underwriting discounts, commissions or
concessions from the selling stockholders and/or the purchasers of shares for
whom they may act as agent. Sales may be made on the Nasdaq National Market or
in private transactions. In addition to sales of common stock pursuant to the
registration statement of which this prospectus is a part, the selling
stockholders may sell such common stock in compliance with Rule 144 promulgated
under the Securities Act.
The selling stockholders and any agents, broker-dealers or underwriters that
participate in the distribution of the common stock offered hereby may be
deemed to be underwriters within the meaning of the Act, and any discounts,
commissions or concessions received by them and any profit on the resale of the
common stock purchased by them might be deemed to be underwriting discounts and
commissions under the Act.
In order to comply with the securities laws of certain states, if
applicable, the common stock may be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
common stock may not be sold unless it has been registered or qualified for
sale or an exemption from registration or qualification requirements is
available and is complied with.
LEGAL MATTERS
The legality of the shares of common stock offered hereby will be passed
upon for us by Cooley Godward LLP, San Diego, California.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our financial
statements and schedule included in our Annual Report on Form 10-K for the year
ended December 31, 1999, and the financial statements of OnPrem Networks
Corporation included in our Current Report on Form 8-K filed on March 15, 2000,
as set forth in their reports, which are incorporated by reference in this
prospectus and elsewhere in the registration statement. Our financial
statements and schedule and the financial statements of OnPrem Networks
Corporation are incorporated by reference in reliance on Ernst & Young LLP's
reports, given on their authority as experts in accounting and auditing.
20
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
This prospectus is part of a registration statement on Form S-3 that we
filed with the Securities and Exchange Commission. Certain information in the
registration statement has been omitted from this prospectus in accordance with
the rules of the SEC. We file proxy statements and annual, quarterly and
special reports and other information with the SEC. You can inspect and copy
the registration statement as well as the reports, proxy statements and other
information we have filed with the SEC at the public reference room maintained
by the SEC at 450 Fifth Street, N. W., Washington, D.C., and at the SEC
Regional Offices located at Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661-2511 and 7 World Trade Center, Suite 1300, New
York, New York 10048. You can call the SEC at 1-800-732-0330 for further
information about the public reference rooms. We are also required to file
electronic versions of these documents with the SEC, which may be accessed from
the SEC's World Wide Web site at http://www.sec.gov. Reports, proxy and
information statements and other information concerning Copper Mountain
Networks, Inc. may be inspected at The Nasdaq Stock Market at 1735 K Street, N.
W., Washington, D.C. 20006.
INCORPORATION BY REFERENCE
The SEC permits us to "incorporate by reference" certain of our publicly-
filed documents into this prospectus, which means that information included in
those documents is considered part of this prospectus. Information that we file
with the SEC after the effective date of this prospectus will automatically
update and supersede this information. We incorporate by reference the
documents listed below and any future filings made with the SEC under Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, or until we
terminate the effectiveness of this registration statement.
The following documents filed with the SEC are incorporated by reference in
this prospectus:
1. Our Annual Report on Form 10-K for the year ended December 31, 1999,
filed on March 17, 2000 and amended on Form 10-K/A on April 20, 2000.
2. Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2000,
filed on April 26, 2000.
3. Our Current Report on Form 8-K, filed on March 15, 2000.
4. Our Current Report on Form 8-K, filed on February 22, 2000.
5. Our Notice of Annual Meeting and Definitive Proxy Statement for the 2000
Annual Meeting of Stockholders, filed on April 10, 2000.
6. The description of our common stock contained in Amendment No. 1 to our
Registration Statement on Form S-1 (No. 333-73153), filed on April 13,
1999, including any amendments or reports filed for the purpose of
updating such description.
We will furnish without charge to you, on written or oral request, a copy of
any or all of the documents incorporated by reference. You should direct any
requests for documents to:
Copper Mountain Networks, Inc.
2470 Embarcadero Way
Palo Alto, CA 94303
Phone (650) 687-3300
Attn: Investor Relations
21
<PAGE>
[LOGO OF COPPER MOUNTAIN]
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses Of Issuance And Distribution.
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by us in connection with the
sale of common stock being registered. All amounts are estimates.
<TABLE>
<S> <C>
SEC registration fee................................................ $27,000
Printing and engraving expenses..................................... $ 5,000
Legal fees and expenses............................................. $20,000
Accounting fees and expenses........................................ $10,000
Blue sky fees and expenses.......................................... $ 1,000
Miscellaneous fees and expenses..................................... $ --
-------
Total........................................................... $63,000
=======
</TABLE>
Item 15. Indemnification Of Directors And Officers.
Under Section 145 of the Delaware General Corporation Law we have broad
powers to indemnify our directors and officers against liabilities they may
incur in such capacities, including liabilities under the Securities Act. Our
Bylaws provide that we will indemnify our directors and executive officers and
may indemnify other officers to the fullest extent permitted by law. Under our
Bylaws, indemnified parties are entitled to indemnification for negligence,
gross negligence and otherwise to the fullest extent permitted by law. The
Bylaws also require us to advance litigation expenses in the case of
stockholder derivative actions or other actions, against an undertaking by the
indemnified party to repay such advances if it is ultimately determined that
the indemnified party is not entitled to indemnification.
In addition, our Certificate of Incorporation provides that, pursuant to
Delaware law, our directors shall not be liable for monetary damages for breach
of the directors' fiduciary duty of care to us and our stockholders. This
provision in the Certificate of Incorporation does not eliminate the duty of
care, and in appropriate circumstances equitable remedies such as injunctive or
other forms of non-monetary relief will remain available under Delaware law. In
addition, each director will continue to be subject to liability for breach of
the director's duty of loyalty to us for acts or omissions not in good faith or
involving intentional misconduct, for knowing violation of law, for actions
leading to improper personal benefit to the director, and for payment of
dividends or approval of stock repurchases or redemptions that are unlawful
under Delaware law. The provision also does not affect a director's
responsibilities under any other law, such as the federal securities laws or
state or federal environmental laws.
We have entered into indemnity agreements with each of our directors and
executive officers. Such indemnity agreements contain provisions that are in
some respects broader than the specific indemnification provisions contained in
Delaware law.
We maintain a policy providing directors' and officers' liability insurance,
which insures our directors and officers in certain circumstances with a
liability limit of $20 million per claim and in the aggregate, subject to
varying retentions. This coverage is on a claims made basis.
II-1
<PAGE>
Item 16. Exhibits And Financial Statement Schedules
(a) Exhibits
<TABLE>
<CAPTION>
Exhibit
Number Description Of Document
------- -----------------------
<C> <S>
2.1 Agreement and Plan of Merger and Reorganization among the Company,
Copper Mountain Acquisition Corp. and OnPREM Networks Corporation
dated January 25, 2000.(4)
3.1 Amended and Restated Certificate of Incorporation of the
Company.(1),(7)
3.2 Bylaws.(1)
4.1 Reference is made to Exhibits 3.1 and 3.2.(1)
4.2 Specimen Stock Certificate.(1)
5.1 Opinion of Cooley Godward LLP.(6)
10.1 Amended and Restated 1996 Equity Incentive Plan (the "1996 Plan").(7)
10.2 Form of Stock Option Agreement pursuant to the 1996 Plan.(1)
10.3 1999 Employee Stock Purchase Plan and related offering documents.(1)
10.4 Employment Agreement between the Company and Steve Hunt, dated July
31, 1996.(1)
10.5 Employment Agreement between the Company and Richard Gilbert, dated
March 22, 1998.(1)
10.6 Master Equipment Lease between the Company and Comdisco, Inc., dated
September 30, 1997.(1)
10.7 Loan and Security Agreement between the Company and Silicon Valley
Bank, dated August 14, 1998.(1)
10.8 Loan and Security Agreement between the Company and Silicon Valley
Bank and MMC/GATX Partnership No. 1, dated October 4, 1996.(1)
10.9 Office Lease between the Company and Public Storage Properties XVIII,
Inc., dated June 14, 1996.(1)
10.10 Office Lease between the Company and R.G. Harris & Company, dated
August 12, 1997.(1)
10.11 Office Sublease between the Company and Stuart Leeb and Associates,
dated May 1, 1998.(1)
10.12 Office Lease between the company and Palomar Enterprises, Inc., dated
July 20, 1998.(1)
10.13 Warrant Agreement between the Company and MMC/GATX Partnership No. 1,
dated October 4, 1996.(1)
10.14 Warrant Agreement between the Company and Silicon Valley Bank, dated
October 4, 1996.(1)
10.15 Warrant Agreement between the Company and Comdisco, Inc., dated
October 29, 1997.(1)
10.16 Warrant Agreement between the Company and Comdisco, Inc. dated April
27, 1998.(1)
10.17 Warrant Agreement between the Company and Intel Corporation, dated
January 14, 1997.(1)
10.18 Warrant Agreement between the Company and Silicon Valley Bank, dated
August 14, 1998.(1)
10.19 Amended and Restated Investors' Rights Agreement by and among the
Company and certain stockholders of the Company, dated October 9,
1998.(1)
10.20 Right of First Refusal and Co-Sale Agreement by and among the Company
and certain stockholders of the Company, dated October 9, 1998.(1)
10.21 Voting Agreement by and among the Company and certain stockholders of
the Company, dated October 9, 1998.(1)
10.22 Founder Stock Purchase Agreement between the Company and Joseph D.
Markee, dated March 11, 1996.(1)
10.23 First Amendment to Founder Stock Purchase Agreement between the
Company and Joseph D. Markee, dated June 12, 1998.(1)
10.24 Founder Stock Purchase Agreement between the Company and Mark J.
Handzel, dated March 11, 1996.(1)
10.25 First Amendment to Founder Stock Purchase Agreement between the
Company and Mark J. Handzel, dated January 27, 1999.(1)
+10.26 General Agreement for the Procurement of Products and Services and the
Licensing of Software between the Company and Lucent Technologies
Inc., dated November 17, 1998.(1)
+10.27 OEM Purchase and Development Agreement between the Company and 3COM
Corporation, dated November 24, 1998.(1)
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
Exhibit
Number Description Of Document
------- -----------------------
<C> <S>
+10.28 Development, Manufacturing and Supply Agreement between the Company
and Netopia, Inc., dated May 19, 1998.(1)
10.29 Warrant Agreement between the Company and Intel Corporation, dated
January 14, 1997.(1)
10.30 1999 Non-Employee Directors' Stock Option Plan.(1)
10.31 Form of Nonqualified Stock Option for use with 1999 Non-Employee
Directors' Stock Option Plan.(1)
10.32 Form of Indemnification Agreement.(1)
+10.33 Equipment Purchase Agreement between the Company and NorthPoint
Communications, Inc. dated April 8, 1999.(1)
+10.34 Standard Full Service Gross Office Lease among the Company, Pacific
Sorrento Mesa Holdings, L.P., and Pacific Stonecrest Holdings, L.P.,
dated March 31, 1999.(1)
+10.35 Equipment Purchase Agreement between the Company and NorthPoint
Communications, Inc. dated July 21, 1999.(2)
+10.36 Equipment Purchase Agreement between the Company and Rhythms
NetConnections, Inc. dated December 10, 1999.(5)
10.37 Software License Agreement between the Company and Rhythms
NetConnections, Inc. dated December 10, 1999.(5)
+10.38 Customer Technical Support Services Agreement between the Company and
Rhythms NetConnections, Inc. dated December 10, 1999.(5)
10.39 Employment Agreement between the Company and Joseph D. Markee, dated
March 12, 1999.(1)
10.40 OnPREM Networks Corporation Stock Option Plan (3).
10.41 Form of Stock Option Agreement pursuant to the OnPREM Networks
Corporation 1998 Stock Option Plan (3).
10.42 Employment Agreement between the Company and Wilson O. Cochran, II,
dated February 29, 2000.(6)
10.43 Non-Competition Agreement between the Company and Wilson O. Cochran,
II, dated February 29, 2000.(6)
10.44 2000 Nonstatutory Stock Option Plan.(8)
10.45 Form of Stock Option Agreement and Form of Stock Option Grant Notice
used in connection with the 2000 Nonstatutory Stock Option Plan.(8)
21.1 Subsidiaries of Copper Mountain Networks, Inc.(6)
23.1 Consent of Ernst & Young LLP, Independent Auditors.*
24.1 Power of Attorney (6)
27 Financial Data Schedule.(6)
</TABLE>
--------
(1) Filed as an exhibit to the Registrant's Registration Statement on Form S-1
filed with the Securities and Exchange Commission (the "Commission") on
March 1, 1999 (File No. 333-73153), as amended by Amendment No. 1 filed
with the Commission on April 13, 1999, Amendment No. 2 filed with the
Commission on April 26, 1999, and Amendment No. 3 filed with the Commission
on May 11, 1999.
(2) Filed as an exhibit to the Registrant's Quarterly Report on Form 10-Q for
the quarter ended September 30, 1999.
(3) Filed as an exhibit to the Registrant's Registration Statement on Form S-8
filed with the Commission on March 10, 1999 (File No. 333-32218).
(4) Filed as an exhibit to the Registrant's Current Report on Form 8-K filed
with the Commission on March 15, 2000.
(5) Filed as an exhibit to the Registrant's Annual Report on Form 10-K for the
year ended December 31, 1999.
II-3
<PAGE>
(6) Previously filed as an exhibit to this Registration Statement on Form S-1
filed with the Commission on March 20, 2000 (File No. 333-32846), as
amended by Amendment No. 1 filed with the Commission on April 27, 2000 and
Amendment No. 2 filed with the Commission on April 28, 2000.
(7) Filed as an exhibit to the Registrant's Notice of Annual Meeting and
Definitive Proxy Statement for the 2000 Annual Meeting of Stockholders
filed with the Commission on April 10, 2000.
(8) Filed as an exhibit to the Registrant's Registration Statement on Form S-8
filed with the Commission on June 7, 2000 (File No. 333-38798).
* Filed Herewith
+ Confidential treatment has been granted with respect to certain portions of
this exhibit. Omitted portions have been filed separately with the
Securities and Exchange Commission.
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:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post- effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement.
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this section
do not apply if the registration statement is on Form S-3, Form S-8 or Form F-
3, and the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or furnished
to the Commission by the registrant pursuant to section 13 or section 15(d) of
the Securities Exchange Act of 1934 that are incorporated by reference in the
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.
(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.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, 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 San Diego, County of San Diego, State of
California, on June 8, 2000.
By: /s/ John A. Creelman
----------------------------------
John A. Creelman
Vice President of Finance,
Chief Financial Officer and
Secretary
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ * President, Chief Executive June 8, 2000
____________________________________ Officer and Director
Richard S. Gilbert (Principal Executive
Officer)
/s/ John A. Creelman Vice President of Finance, June 8, 2000
____________________________________ Chief Financial Officer, and
John A. Creelman Secretary (Principal
Financial and Accounting
Officer)
/s/ * Chief Technical Officer and June 8, 2000
____________________________________ Chairman of the Board
Joseph D. Markee
/s/ * Director June 8, 2000
____________________________________
Robert L. Bailey
/s/ * Director June 8, 2000
____________________________________
Tench Coxe
/s/ * Director June 8, 2000
____________________________________
Roger Evans
/s/ * Director June 8, 2000
____________________________________
Richard H. Kimball
/s/ * Director June 8, 2000
____________________________________
Raymond V. Thomas
/s/ * Director June 8, 2000
____________________________________
Andrew W. Verhalen
*By: /s/ John A. Creelman
____________________________________
John A. Creelman
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description Of Document
------- -----------------------
<C> <S>
2.1 Agreement and Plan of Merger and Reorganization among the Company,
Copper Mountain Acquisition Corp. and OnPREM Networks Corporation
dated January 25, 2000.(4)
3.1 Amended and Restated Certificate of Incorporation of the
Company.(1),(7)
3.2 Bylaws.(1)
4.1 Reference is made to Exhibits 3.1 and 3.2.(1)
4.2 Specimen Stock Certificate.(1)
5.1 Opinion of Cooley Godward LLP.(6)
10.1 Amended and Restated 1996 Equity Incentive Plan (the "1996 Plan").(7)
10.2 Form of Stock Option Agreement pursuant to the 1996 Plan.(1)
10.3 1999 Employee Stock Purchase Plan and related offering documents.(1)
10.4 Employment Agreement between the Company and Steve Hunt, dated July
31, 1996.(1)
10.5 Employment Agreement between the Company and Richard Gilbert, dated
March 22, 1998.(1)
10.6 Master Equipment Lease between the Company and Comdisco, Inc., dated
September 30, 1997.(1)
10.7 Loan and Security Agreement between the Company and Silicon Valley
Bank, dated August 14, 1998.(1)
10.8 Loan and Security Agreement between the Company and Silicon Valley
Bank and MMC/GATX Partnership No. 1, dated October 4, 1996.(1)
10.9 Office Lease between the Company and Public Storage Properties XVIII,
Inc., dated June 14, 1996.(1)
10.10 Office Lease between the Company and R.G. Harris & Company, dated
August 12, 1997.(1)
10.11 Office Sublease between the Company and Stuart Leeb and Associates,
dated May 1, 1998.(1)
10.12 Office Lease between the company and Palomar Enterprises, Inc., dated
July 20, 1998.(1)
10.13 Warrant Agreement between the Company and MMC/GATX Partnership No. 1,
dated October 4, 1996.(1)
10.14 Warrant Agreement between the Company and Silicon Valley Bank, dated
October 4, 1996.(1)
10.15 Warrant Agreement between the Company and Comdisco, Inc., dated
October 29, 1997.(1)
10.16 Warrant Agreement between the Company and Comdisco, Inc. dated April
27, 1998.(1)
10.17 Warrant Agreement between the Company and Intel Corporation, dated
January 14, 1997.(1)
10.18 Warrant Agreement between the Company and Silicon Valley Bank, dated
August 14, 1998.(1)
10.19 Amended and Restated Investors' Rights Agreement by and among the
Company and certain stockholders of the Company, dated October 9,
1998.(1)
10.20 Right of First Refusal and Co-Sale Agreement by and among the Company
and certain stockholders of the Company, dated October 9, 1998.(1)
10.21 Voting Agreement by and among the Company and certain stockholders of
the Company, dated October 9, 1998.(1)
10.22 Founder Stock Purchase Agreement between the Company and Joseph D.
Markee, dated March 11, 1996.(1)
10.23 First Amendment to Founder Stock Purchase Agreement between the
Company and Joseph D. Markee, dated June 12, 1998.(1)
10.24 Founder Stock Purchase Agreement between the Company and Mark J.
Handzel, dated March 11, 1996.(1)
10.25 First Amendment to Founder Stock Purchase Agreement between the
Company and Mark J. Handzel, dated January 27, 1999.(1)
+10.26 General Agreement for the Procurement of Products and Services and the
Licensing of Software between the Company and Lucent Technologies
Inc., dated November 17, 1998.(1)
+10.27 OEM Purchase and Development Agreement between the Company and 3COM
Corporation, dated November 24, 1998.(1)
+10.28 Development, Manufacturing and Supply Agreement between the Company
and Netopia, Inc., dated May 19, 1998.(1)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Exhibit
Number Description Of Document
------- -----------------------
<C> <S>
10.29 Warrant Agreement between the Company and Intel Corporation, dated
January 14, 1997.(1)
10.30 1999 Non-Employee Directors' Stock Option Plan.(1)
10.31 Form of Nonqualified Stock Option for use with 1999 Non-Employee
Directors' Stock Option Plan.(1)
10.32 Form of Indemnification Agreement.(1)
+10.33 Equipment Purchase Agreement between the Company and NorthPoint
Communications, Inc. dated April 8, 1999.(1)
+10.34 Standard Full Service Gross Office Lease among the Company, Pacific
Sorrento Mesa Holdings, L.P., and Pacific Stonecrest Holdings, L.P.,
dated March 31, 1999.(1)
+10.35 Equipment Purchase Agreement between the Company and NorthPoint
Communications, Inc. dated July 21, 1999.(2)
+10.36 Equipment Purchase Agreement between the Company and Rhythms
NetConnections, Inc. dated December 10, 1999.(5)
10.37 Software License Agreement between the Company and Rhythms
NetConnections, Inc. dated December 10, 1999.(5)
+10.38 Customer Technical Support Services Agreement between the Company and
Rhythms NetConnections, Inc. dated December 10, 1999.(5)
10.39 Employment Agreement between the Company and Joseph D. Markee, dated
March 12, 1999.(1)
10.40 OnPREM Networks Corporation Stock Option Plan (3).
10.41 Form of Stock Option Agreement pursuant to the OnPREM Networks
Corporation 1998 Stock Option Plan (3).
10.42 Employment Agreement between the Company and Wilson O. Cochran, II,
dated February 29, 2000.(6)
10.43 Non-Competition Agreement between the Company and Wilson O. Cochran,
II, dated February 29, 2000.(6)
10.44 2000 Nonstatutory Stock Option Plan.(8)
10.45 Form of Stock Option Agreement and Form of Stock Option Grant Notice
used in connection with the 2000 Nonstatutory Stock Option Plan.(8)
21.1 Subsidiaries of Copper Mountain Networks, Inc.(6)
23.1 Consent of Ernst & Young LLP, Independent Auditors.*
24.1 Power of Attorney (6)
27 Financial Data Schedule.(6)
</TABLE>
--------
(1) Filed as an exhibit to the Registrant's Registration Statement on Form S-1
filed with the Securities and Exchange Commission (the "Commission") on
March 1, 1999 (File No. 333-73153), as amended by Amendment No. 1 filed
with the Commission on April 13, 1999, Amendment No. 2 filed with the
Commission on April 26, 1999, and Amendment No. 3 filed with the Commission
on May 11, 1999.
(2) Filed as an exhibit to the Registrant's Quarterly Report on Form 10-Q for
the quarter ended September 30, 1999.
(3) Filed as an exhibit to the Registrant's Registration Statement on Form S-8
filed with the Commission on March 10, 1999 (File No. 333-32218).
(4) Filed as an exhibit to the Registrant's Current Report on Form 8-K filed
with the Commission on March 15, 2000.
(5) Filed as an exhibit to the Registrant's Annual Report on Form 10-K for the
year ended December 31, 1999.
(6) Previously filed as an exhibit to this Registration Statement on Form S-1
filed with the Commission on March 20, 2000 (File No. 333-32846), as
amended by Amendment No. 1 filed with the Commission on April 27, 2000 and
Amendment No. 2 filed with the Commission on April 28, 2000.
<PAGE>
(7) Filed as an exhibit to the Registrant's Notice of Annual Meeting and
Definitive Proxy Statement for the 2000 Annual Meeting of Stockholders
filed with the Commission on April 10, 2000.
(8) Filed as an exhibit to the Registrant's Registration Statement on Form S-8
filed with the Commission on June 7, 2000 (File No. 333-38798).
* Filed Herewith
+ Confidential treatment has been granted with respect to certain portions of
this exhibit. Omitted portions have been filed separately with the
Securities and Exchange Commission.
