As Filed with the Securities and Exchange Commission on May 9, 1996
Registration No. 333-02345
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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AMENDMENT NO.1
TO
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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INTERDIGITAL COMMUNICATIONS CORPORATION
(Exact Name of Registrant as Specified in Charter)
PENNSYLVANIA 23-1882087
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Identification
Organization) Number)
781 Third Avenue
King of Prussia, Pennsylvania 19406
(610) 878-7800
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
William A. Doyle, President
InterDigital Communications Corporation
781 Third Avenue
King of Prussia, Pennsylvania 19406
(610) 878-7800
(Name and address, including zip code, and telephone number,
including area code, of agent for service)
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Approximate date of commencement of proposed sale to public: As soon as
practicable after the effectiveness of this Registration Statement.
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If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
<PAGE>
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration number of the earlier effective
registration number of the earlier effective registration statement for the same
offering. / /
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. / /
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================================================
Proposed Proposed
Maximum Maximum
Title of Amount Offering Aggregate Amount of
Securities To Be Price Per Offering Registration
To be Registered Registered Share (2) Price (2) Fee (3)
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<S> <C> <C> <C> <C>
Common Stock 6,751 (1) $8.72 $58,870 $21
================================================================================================================================
</TABLE>
(1) This registration statement registers the resale of 1,810,703 shares of the
Registrant's Common Stock issuable upon the exercise of warrants, including
6,751 shares being registered with this Amendment No. 1 and 1,803,952
shares previously registered herewunder. The issuance of the shares of
Common Stock upon exercise of the warrants is not being registered under
this registration statement, but rather only the resale of such shares.
(2) Estimated pursuant to Rule 457(c) under the Securities Act of 1993.
(3) A registration fee of $5,443 has been previously paid with respect
to 1,803,952 shares previously registered hereunder.
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
PROSPECTUS
INTERDIGITAL COMMUNICATIONS CORPORATION
This Prospectus relates to the resale by the Selling Shareholders of a
total of 1,810,703 shares of Common Stock, $.01 par value per share (the "Common
Stock") of InterDigital Communications Corporation (the "Company") which may be
issued by the Company upon the exercise of outstanding warrants (the "Warrants")
to purchase shares of Common Stock at per share exercise prices ranging from
$4.39 to $8.625. The issuance of the shares of Common Stock upon exercise of the
Warrants is not covered by this Prospectus, but rather only the resale of such
shares. See "Selling Shareholders."
There is no assurance that any of the Warrants will be exercised, and
therefore there are no assurances that the Company will receive any proceeds
hereunder. The Company will not receive any proceeds from the sale of shares of
Common Stock by Selling Shareholders. See "Selling Shareholders."
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
PROSPECTIVE PURCHASERS SHOULD CONSIDER THE RISKS SET FORTH UNDER "RISK
FACTORS" COMMENCING ON PAGE 2.
The shares offered by the Selling Shareholders hereby will be sold at
market prices on the American Stock Exchange ("AMEX") or in private sales at
prevailing market prices or negotiated prices. Selling Shareholders may pay
commissions or other compensation to broker-dealers in connection with such
sales, which may be in excess of customary commissions charged for AMEX
transactions. See "Selling Shareholders."
The Common Stock is traded on the AMEX under the symbol IDC. On May 7,
1996, the closing sales price of the Common Stock, as reported by the AMEX, was
$8 13/16.
The date of this Prospectus is , 1996
<PAGE>
RISK FACTORS
In analyzing this offering, prospective purchasers should carefully
consider the following risks.
Accumulated Deficit and History of Operating Losses. The Company has
experienced losses from its inception in 1972 through the third quarter of
1994 and in selected periods thereafter, and, as of December 31, 1995, the
Company's accumulated deficit was $150.3 million. In recent years, the Company
has incurred significant increases in expenses associated with its UltraPhone
business activities, the development of related product enhancements, the
acquisition and development, as applicable, of its Time Division Multiple Access
("TDMA") and Broadband Code Division Multiple Access ("B-CDMA") digital wireless
technologies, and the enforcement of its patents. There can be no assurance that
the Company will realize revenues and gross profits sufficient to achieve or
sustain profitability on a quarterly or annual basis in the future. In the event
it fails to do so, the Company's operations could be adversely affected and
investors in the Common Stock could face the loss of part or all of their
investment.
Need for Expansion and Increased Profitability of UltraPhone(R) Sales.
Prior to 1994, sales of the UltraPhone system historically accounted for a
substantial majority of the Company's revenues. During 1994 and 1995, licensing
and alliance revenues constituted the majority of the total revenues of the
Company. The Company's future profitability may, in the event of any significant
decline in licensing and alliance revenues, depend significantly on the
expansion of UltraPhone sales by increasing sales to its existing customers,
broadening the Company's customer base, or both. Since 1993, the Company has
experienced negative gross profit margins in its UltraPhone operations as a
result of insufficient production volumes and higher than desired variable costs
relative to declining sales prices in such operations. More specifically, the
Company has accepted major orders for 1996 and 1997 delivery and is actively
marketing the UltraPhone system in certain opportunities, at sales prices which
are expected to generate little, if any, margin based on the current cost
characteristics of the system configurations being proposed. There can be no
assurance that the Company will be able to increase UltraPhone sales and
decrease UltraPhone variable operating costs sufficiently to achieve
profitability in its UltraPhone operations. Moreover, many of the Company's
contracts for UltraPhone sales contain provisions which could result in the
imposition of liquidated damages for late performance or the drawing of
performance bonds for defaults. Either of these events would put further
downward pressure on UltraPhone profitability. Unless the Copmany is able to
achieve positive profit margins in its UltraPhone operations, investors in the
Common Stock could lose part or all of their investment.
Dependence on a Limited Number of Customers, Alliance Partners and
Licensees. A substantial majority of UltraPhone sales have historically
been concentrated among only a few major customers, and it is anticipated that
such concentration will continue for the foreseeable future. Customers engaged
in multi-year telecommunications infrastructure programs traditionally purchase
different types of telephone equipment in the various phases of a program and
therefore typically would not purchase a consistent number of UltraPhone systems
in each year of the program. Transitions to different phases of acquisition
programs by significant customers, other reductions in purchases from those
customers (unless replaced by other new orders), or the loss of such customers
could have a material adverse effect on the Company. Similarly, the Company's
licensing and alliance revenues have been generated from only a relatively few
licensees and alliance partners. There can be no assurance that
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InterDigital Technology Corporation ("ITC"), an indirect 94% owned subsidiary of
the Company, will enter into patent license agreements with any additional
entities or that additional licensing revenue will be generated from ITC's
existing patent license agreements. There can be no assurance that the Company
will enter into additional alliances or that its current alliances will generate
additional revenues. The failure of ITC to enter into additional license
agreements or of the Company to achieve its alliance objectives could have a
material adverse effect on the Company. In either of such cases, the Company's
operations could be adversely affected and investors in the Common Stock could
lose part or all of their investment.
Quarterly Fluctuations in Financial Results. Historically, the fact that
new license agreements are not entered into on a regular, predictable basis has
been a factor in the significant fluctuations in the Company's revenues and
operating results from quarter to quarter, and there can be no assurance that
the Company's licensing activities will not diminish or cease during any
relevant time interval. Likewise, the concentration of UltraPhone sales to a few
major customers and the signing of patent license agreements providing for
up-front license fees with a few licensees also contributes to quarterly
fluctuations in the Company's financial results. UltraPhone sales are expected
to continue to be concentrated among only a few major customers who purchase
UltraPhone systems at sometimes unpredictable levels and intervals. As an
example of the fluctuation of quarterly financial results, the Company was
profitable in the first and second quarters of 1995 and unprofitable in the
third and fourth quarters of 1995. The variability of 1995 quarterly operating
results was due to the revenue related to one-time license agreements. The
Company's UltraPhone sales and patent and technology licensing revenues may also
fluctuate as a result of other factors, including increased competition from
other products or technologies, announcements of new products or technologies by
the Company or its competitors, equipment acquisition and replacement patterns
of the Company's customers, general domestic and global economic and political
conditions, and perception of the strength and enforceability of the Company's
patent portfolio. As a result, the value of a Common Stock purchaser's
investment could be adversely affected.
Competition in the Telecommunications Industry. Competition in the
communications industry is intense. Generally, a number of entities, many
of which are substantially larger and have substantially greater financial,
technical, marketing and other resources than the Company, sell or may introduce
products which compete both domestically and internationally with the
UltraPhone. Further, certain competing wireless telecommunications technologies
(principally analog cellular) offer a lower-cost product as compared to the
UltraPhone system as currently configured and other wireless technologies offer
or purport to offer certain features not currently supported by the UltraPhone
system. There can be no assurance that the Company's competitors will not market
competitive wireless communications systems in an increasingly aggressive
manner, which could materially and adversely continue to affect the Company's
UltraPhone business in the future. If this were to happen, the Company's assets
could diminish and the Company could experience an increase in accumulated
deficit. Such results could adversely affect the value of an investment in the
Common Stock.
Need for UltraPhone Engineering Modifications. The Company has
experienced and may continue to experience engineering delays and incur costs
related to engineering modifications in the introduction of new subscriber units
and other new enhancements or features. There can be no assurance that such
engineering delays or the costs of making any required engineering modifications
will not be substantial or that any required engineering modifications will be
successfully designed or implemented on a timely basis for
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any particular application. The failure of any such engineering modifications to
be successfully and timely designed or implemented could have a material adverse
effect upon the Company's financial condition and results of operations. Such a
result could adversely affect the value of a Common Stock purchaser's
investment.
Reliance on Sole Source Suppliers. The Company currently obtains certain
critical components for the UltraPhone system from sole source suppliers. The
failure of the Company to develop and enter into acceptable contracts with
alternative sources for other critical components, or to obtain sufficient sole
or limited source components of acceptable quality, as required, could result in
delays or reductions in product shipments which could adversely affect the
Company's business prospects and relations with its customers. This, in turn,
could adversely affect the value of a Common Stock purchaser's investment.
Dependence on Alliance Program. The Company has entered into an alliance
program designed, among other things, to enhance its UltraPhone marketing
efforts and to promote its CDMA efforts. For example, in February 1996, the
Company entered into an executory alliance agreement with Samsung Electronics
Co., Ltd. ("Samsung"), which has agreed to make a financial contribution to the
Company and to participate, as a licensee, in the development of B-DCMA
technology and the marketing of the UltraPhone system. In December 1994, the
Company entered into an alliance agreement with Siemens Aktiengesellschaft
("Siemens"), which has begun to market the UltraPhone product. The elements of
the alliance strategy are interdependent and the failure to successfully achieve
any of the objectives would adversely affect the success of the overall strategy
and could have a material adverse effect upon the Company's financial position
and results of operations. This, in turn, could adversely affect the value of a
Common Stock purchaser's investment. See "--Dependence on a Limited Number of
Customers, Alliance Partners and Licensees."
Dependence on Patented and Proprietary Technology. The Company's
UltraPhone business depends substantially upon its proprietary technology,
including technology covered by patents owned by ITC. ITC's licensing
opportunities depend upon its ability to enforce its patents against third
parties. In high technology fields, the validity and enforceability of patents
are often subject to complex legal and factual challenges and other
uncertainties. There can be no assurance that ITC's other existing patents or
any patents that may be issued in the future will not be declared invalid, or
that ITC's patents will afford the Company the required protection against
competitors with similar technology; nor can there be any assurance that patents
issued to ITC will not be infringed upon, or circumvented through design
changes, by others. See "Adverse Results in Motorola Trial" below. In addition,
in the normal course of business, third parties have asserted, and may assert in
the future, that the Company is engaged in the infringing use of such third
party's patents or proprietary technology. If any such third party successfully
asserts that the Company is engaged in any such infringing use, the Company may
be required to contest the validity of such patents or proprietary technology,
to acquire licenses to use such patented or proprietary technology and/or to
redesign the Company's products to avoid further infringement. There can be no
assurance that such licenses can be obtained or that the Company would prevail
in any such contests. Furthermore, the Company relies upon non-competition and
non-disclosure agreements for the protection of certain other proprietary
technology. There can be no assurance that these agreements will prove adequate
to enforce the Company's proprietary rights in such technology. If the Company's
patents were declared invalid or the Company's proprietary technology were
otherwise used by third parties without licensing such patents and technologies
from the Company, the Company's financial position and results or operations
would be materially adversely affected. This could substantially affect the
Company's
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prospects for realizing future income and, thereby, investors in the
Common Stock could lose part or all of their investment.
Adverse Results in Motorola Trial. In March 1995, a trial involving ITC
and Motorola, Inc., ended with the jury's verdict, which is subject to varying
interpretation, but which is interpreted by the Company to mean that ITC's
patent claims at issue in the case, involving four of ITC's patents, are not
infringed by Motorola and, if construed to be infringed, are invalid. Motorola
filed a motion with the District Court requesting an order for the Company to
pay Motorola's legal fees and expenses aggregating between $6 and $7 million,
which the Court has dismissed as being premature. The Company has filed a motion
with the District Court requesting that the Court overturn and/or clarify all or
part of the jury verdict and, if that motion is unsuccessful, the Company
intends to appeal the jury verdict to the U.S. Court of Appeals for the Federal
Circuit. The Court has not yet ruled on this motion. The Company believes that
there are substantial grounds for reversal of the jury's verdict or the granting
of a new trial. In the short term, the jury verdict may adversely affect the
Company's efforts to generate further revenue and cash flow from ITC's patent
portfolio and may impair generally the Company's ability to raise additional
funds for general corporate purposes. This, in turn, could adversely affect the
value of a Common Stock purchaser's investment. The outcome of the jury trial
may also temporarily or permanently adversely affect ITC's pending U.S. patent
infringement litigation against Ericsson GE Mobile Communications, Inc. and
certain of its affiliates (collectively, "Ericsson") and its ability to realize
running royalties under certain of its license agreements. An adverse ruling on
Motorola's motion for legal fees, assuming that Motorola presents its motion for
legal fees at the appropriate time, could adversely affect the Company's cash
position. There can be no assurance that the Motorola verdict will be reversed
or that any future motion for legal fees will be denied, and any reversal of the
verdict should be expected to occur in the intermediate- to long-term rather
than in the near future. In the event that the Motorola verdict is not
overturned or reversed or any future motion filed by Motorola for legal fees is
not denied, the Company's future prospects could be materially adversely
affected and investors in the Common Stock could lose part or all of their
investment.
Protecting Patents and Proprietary Technology. Litigation and other
costs of protecting a patent portfolio can be significant. ITC is currently in
litigation or involved in administrative proceedings, both in the United States
and abroad, over certain of its patents. In the event any of these proceedings
were to have unfavorable results, or if any of ITC's patents were to be declared
invalid, it could have a material adverse effect on ITC's patent licensing
opportunities, if any. This could adversely affect the Company's ability to
realize additional licensing revenues.
Dependence on Foreign Sales. InterDigital expects that sales of
UltraPhone systems to foreign customers will continue to account for a
substantial portion of the Company's total product revenues. Sales of UltraPhone
systems to foreign customers accounted for 65%, 79% and 84%, respectively, of
the Company's UltraPhone product revenues for 1993, 1994 and 1995. Foreign sales
of UltraPhone systems are subject to local economic and political factors which
may result in delays in completing sales or the inability to complete sales.
Foreign sales of UltraPhone systems may be affected by changes in demand
resulting from fluctuations in currency exchange rates, as well as by risks such
as tariff and quota regulations and difficulties in obtaining export or import
licenses, among other things. The Company's UltraPhone sales usually depend upon
a customer's ability to obtain financing for the purchase, and there can be no
assurance that the Company's existing or prospective customers will be able to
qualify for or obtain the financing necessary to purchase
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UltraPhone systems. Failure to do so could adversely affect the Company's cash
flow and profitability. This, in turn, could adversely affect the value of the
Company's Common Stock.
Risk of International Operations. The Company's ability to conduct
business in certain areas outside the United States and its revenues derived
from foreign licensees may be adversely affected by certain risks inherent in
international operations. In conducting business in foreign jurisdictions the
Company may be subject, in addition to the effects of government regulation, to
the effects of tariffs and any other applicable trade barriers, currency control
regulations, political instability, potential adverse tax consequences, and
general delays in remittance and difficulties of collection of foreign payments,
among other things. Also, currency conversion gains and losses could contribute
to fluctuations in InterDigital's operating results. If for any reason exchange
or price controls or other restrictions on the conversion or repatriation of
foreign currencies were imposed, InterDigital's revenues derived from any
foreign customers or licensees could be adversely affected. In such event, the
value of a Common Stock purchaser's investment could be adversely affected.
Lack of Technological Change and Product Development. The
telecommunications industry is characterized by rapid technological change,
frequent product introductions and evolving domestic and international industry
standards. The Company believes that its potential for future success will
depend on, among other things, whether it will be able to (i) meet evolving
customer and country-specific requirements through continued refinements to the
UltraPhone (including frequency modifications and B-CDMA development projects),
and (ii) reduce product costs to allow for more aggressive UltraPhone product
pricing and increased gross profit margins and for continued B-CDMA development
projects. Such efforts will necessitate continued significant investment by the
Company in research and development and in sales and marketing. There can be no
assurance that the Company will have sufficient resources to make such
investments, that the Company will be able to make the technological advances
necessary to achieve these goals and thereby capture a level of sales sufficient
to achieve its future success, or that the costs of such efforts will be
acceptable to the Company. There can be no assurance that the Company's products
will not be rendered obsolete or non-competitive by new industry standards or
changing technology or that the Company will be able successfully to increase
UltraPhone sales or to develop and successfully market new products. In such
event, the Company's operations could be jeopardized and investors in the Common
Stock could lose part or all of their investment.
Regulatory and Standards Compliance. In general, the telecommunications
industry is subject to continued regulation on the federal, state and
international levels and, in many cases, domestic, regional and international
organizations, including financing agencies, impose standards for acceptance or
type certification of telecommunications products. Changes in these regulations
or standards may adversely impact the Company's ability to sell UltraPhone
systems or impose additional costs and/or time delays with respect to such
sales. In such event, the value of a Common Stock holders's investment could be
adversely affected.
Changes to Government Regulations. The commercial potential for the
Company's proprietary technologies may be materially affected by regulations and
actions of the Federal Communications Commission ("FCC"), state public service
and utility commissions, the United States Congress and the courts relating to
the regulation of competition, rate tariffs and/or frequency use, which could
affect the market, demand and availability of communications systems. These
restrictions, and those imposed by counterpart agencies in foreign
jurisdictions, may be important factors in decisions by telephone companies,
cellular system operators and other authorized service providers concerning
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utilization of the Company's proprietary technologies. Such restrictions could
adversely affect the Company's sales and, in turn, could adversely affect the
value of the Common Stock.
Effect of Litigation on Cash Position. The Company is currently in
patent, securities and other litigation, both as a plaintiff and a defendant, in
the United States, and is involved in administrative proceedings abroad, over
certain of its patents. The legal fees and costs associated with such litigation
will be substantial. A judicial determination of liability requiring the Company
to pay substantial amounts could adversely affect the Company's cash position.
In addition, an adverse or inconclusive result in the Company's pending patent-
related litigation against Ericsson could adversely affect the Company's efforts
to generate further revenue and cash flow from its patent portfolio and could
impair generally the Company's ability to raise additional funds. Either of
these results, in turn, could adversely affect the value of a Common Stock
purchaser's investment.
Need for Additional Financing. The Company's operations to date have
required substantial amounts of working capital, and the Company expects to
spend substantial funds to support its UltraPhone operations, to develop
improvements and enhancements to the UltraPhone system, to further expand its
research and development activities relating to its B-CDMA technology and to
fund its patent enforcement activities. The Company's working capital
requirements will depend on numerous factors, including but not limited to the
level of demand for the UltraPhone system, the progress of the Company's
research and development programs, the ability to generate patent license fees
and royalties, and the need to expend funds in connection with its patent
protection activities. To the extent that cash on hand and funds generated from
operations are insufficient, the Company will have to raise additional funds to
meet its working capital requirements. Continued availability of working capital
will be dependent on the financial condition of the Company, and there is no
assurance that additional financing will be available or, if available, that it
will be available on acceptable terms. In the event sufficient working capital
is not obtained or maintained, the Company's operations could be substantially
and adversely disrupted. This, in turn, could adversely affect the value of a
Common Stock purchaser's investment.
Dependence on and Availability of Key Personnel. The Company's business
will continue to depend upon certain key personnel, none of whom currently
are parties to employment agreements with the Company. Only a limited number of
the Company's key personnel have entered into employment agreements with the
Company. The Company believes that to succeed in the future it will be required
to continue to attract, retain and motivate a significant number of talented and
qualified management, sales and technical personnel. There can be no assurance
that the Company will be able to retain its key employees, or that the Company
will be able to continue to attract, assimilate and retain other skilled
management, sales and technical personnel. The loss of any of its existing key
personnel or the inability to attract and retain a sufficient number of key
employees in the future could have a material adverse effect on the Company.
This, in turn, could adversely affect the value of the Common Stock of the
Company.
Adverse Effects to Common Stock Upon Issuance of Additional Preferred
Stock. InterDigital is authorized to issue 14,398,600 shares of its preferred
stock, par value $.10 per share ("Preferred Stock"), of which approximately
105,000 shares were issued and outstanding as of December 31, 1995. The
InterDigital Board, without any further action by InterDigital's shareholders,
may issue from time to time the authorized and unissued shares of Preferred
Stock in one or more series, and may determine as to each series the designation
and number of shares to be issued and the relative rights, preferences and
limitations of the shares of each series, including provisions with respect to
voting powers, redemption, conversion, dividend rights and liquidation
preferences. The issuance of Preferred Stock could adversely
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affect the voting power of the holders of Common Stock, deny holders of Common
Stock the receipt of a premium on their Common Stock and have a depressive
effect on the market price of the Common Stock. The issuance of Preferred Stock
could also have the effect of deterring or delaying any attempt by a person or
group to obtain control of InterDigital.
Volatility of Securities Prices. Historically, market prices for
securities of companies involved in the wireless telecommunications industry
have been volatile. In addition, market prices for the Common Stock have
historically been particularly volatile due, in part, to the Company's history
of quarterly fluctuations of revenues and operating results. Announcements of,
among other things, technological innovations or new commercial products by the
Company or its competitors, developments concerning proprietary technologies,
results of patent enforcement activities, regulatory developments in both the
United States and other countries, and global and national economic and
political factors, as well as period-to-period fluctuations in financial
results, may have a significant impact on the market price of the Common Stock.
See " - Adverse Effects to Common Stock Upon Issuance of Additional Preferred
Stock."
Lack of Dividends on Common Stock. InterDigital has not declared or paid
cash dividends on the Common Stock since its inception. It is anticipated that
in the foreseeable future, no cash dividends will be declared or paid on the
Common Stock and any cash otherwise available for such dividends will be
reinvested in the Company's business.
Anti-Takeover Provisions. Unsolicited changes in control of InterDigital
could be deterred, delayed or made more expensive as a result of applicable
statutory protections (relating to transactions with certain "interested
persons" and "controlling persons"), the statutory authorization for the
InterDigital Board to consider the interests of constituent groups (other than
InterDigital's shareholders) when determining whether a particular action is in
the best interests of InterDigital, provisions of InterDigital's Bylaws
establishing a classified InterDigital Board, and certain provisions in
InterDigital's Articles of Incorporation. Accordingly, these provisions and
protections may have a depressive effect on the price of InterDigital's
securities.
AVAILABLE INFORMATION
The Company has filed a Registration Statement on Form S-3 with the
Securities and Exchange Commission (the "Commission") relating to the shares of
Common Stock offered hereby. This Prospectus does not contain all the
information set forth in the Registration Statement, certain portions of which
have been omitted pursuant to the rules and regulations of the Commission.
Reference is hereby made to the Registration Statement and to the exhibits
relating thereto for further information with respect to the Company and the
securities offered hereby.
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") and, in accordance
therewith, files reports and other information with the Commission. Proxy
statements concerning the Company, reports and other information filed by the
Company can be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549,
and at the Commission's regional offices in New York (7 World Trade Center,
Suite 1300, New York, New York 10048) and Chicago (Citicorp Center, 500 W.
Madison St., Suite 1400, Chicago, Illinois 60661-2511). Copies of such material
can be obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549 at prescribed rates.
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The Company will furnish, without charge, to any person to whom a copy
of this Prospectus is delivered, upon such person's written or oral request, a
copy of any and all of the documents that have been incorporated by reference in
the Registration Statement and herein (not including exhibits to such documents,
unless such exhibits are specifically incorporated by reference into such
documents). Any such request should be directed to the Corporate Secretary,
InterDigital Communications Corporation, 781 Third Avenue, King of Prussia,
Pennsylvania 19406, phone number: (610) 878-7800.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated in this Prospectus by reference:
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1995.
(b) The description of the Common Stock contained in the Company's
Registration Statement on Form 8-A dated April 28, 1987, including
any amendments or reports filed for the purpose of updating such
description.
(c) In addition, all documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
prior to the termination of the offering shall be deemed to be
incorporated by reference herein from their respective dates of
filing.
Any statements contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is incorporated or deemed
to be incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
THE COMPANY
The Company develops and markets advanced digital wireless
telecommunications systems using proprietary technologies for voice and data
communications and has developed an extensive patent portfolio related to those
technologies. The Company offers its customers, licensees and alliance partners
what it believes is unique access to both TDMA and B-CDMA proprietary digital
wireless technology.
The Company's principal product is the UltraPhone(R) system, a radio
telephone system providing businesses and households access to basic
telephone service through a wireless local loop. The UltraPhone system offers
greater flexibility and ease of installation than conventional wireline-based
systems and is designed to provide higher transmission quality, capacity and
spectrum efficiency than other wireless systems presently in use. The UltraPhone
system, which incorporates the Company's TDMA technology, is sold predominantly
to foreign telephone companies to provide basic telephone service to their
customers, primarily in rural and near-urban areas, where the cost of, or time
required for, installing, upgrading or maintaining conventional wireline
telephone service supports selection of an UltraPhone system. Sales of
UltraPhone systems accounted for approximately 88%, 40% and 20%, respectively,
of the total revenues of the Company during 1993, 1994 and 1995. Through
-9-
<PAGE>
December 31, 1995, the Company has sold over 235 UltraPhone systems worldwide,
with aggregate UltraPhone sales totaling over $135 million.
The Company's objective is to become a significant global supplier of
digital wireless communications technology and systems based on its
proprietary TDMA and B-CDMA technologies. To achieve that objective, the Company
has developed an alliance program under which it intends to align itself with
key entities in the telecommunications industry. Two of the three key objectives
of the Company's alliance program, if fully and successfully implemented, are to
generate licensing revenues as well as to improve the Company's UltraPhone
product business by (i) making the Company and its UltraPhone products more
credible competitors in large scale telecommunications infrastructure programs,
(ii) expanding the depth and coverage of UltraPhone product marketing efforts
around the world, (iii) facilitating greater focus in the Company's direct sale
activities, and (iv) funding and facilitating engineering changes and
alternative supply and production sources to attempt to significantly reduce
costs and expand product capabilities.
The third objective of the alliance program is to bolster the Company's
on-going efforts to develop its B-CDMA air interface technology and to spread
the commercialization of B-CDMA-based wireless local loop applications and start
the development of B-CDMA-based wireless Personal Communications Service ("PCS")
applications. The successful commercial development and deployment of such
products is dependent upon technological achievement, including the continued
validation of the theories upon which the new technology is being designed, the
continued availability of debt, equity or alliance partner funding sufficient to
support an increasing level of efforts over several years and, ultimately,
market acceptance of the resultant product.
In December 1994, the Company completed the initial implementation of the
alliance program by entering into an integrated series of agreements with
Siemens covering UltraPhone marketing and product development, B-CDMA
development, patent licensing and other areas of cooperation. The Company
continued its implementation of the alliance program when it signed a series of
agreements, presently executory, with Samsung in February 1996. The agreements
cover B-CDMA technology development, patent licensing, product development,
technology transfer and other areas of cooperation.
ITC and the Company together offer non-exclusive, royalty bearing
patent, technology and know-how licenses to telecommunications
manufacturers that manufacture, use or sell, or intend to manufacture, use or
sell, equipment that utilizes their extensive portfolio of TDMA and Code
Division Multiple Access ("CDMA") patented technologies. The Company believes
that, through ITC's patent portfolio, and the Company's TDMA and B-CDMA research
and development capabilities and resultant know-how, both it and ITC are
positioned to take advantage of the present evolution in wireless
telecommunications to digital technology from analog technology, which
represents a substantial portion of the worldwide installed base. ITC
implemented a strategy during 1993 of negotiation and litigation with certain
entities which it believed were representative of the broader number of entities
infringing ITC's patents. These efforts have resulted in patent license
agreements with a total of twelve entities as of March 29, 1996, the recognition
of $28.7 and $67.7 million of licensing revenue in 1994 and 1995, respectively,
and the initiation of litigation against major telecommunications companies.
See "Risk Factors -- Adverse Results in Motorola Trial."
As an adjunct to its primary business, the Company had provided advanced
digital wireless research and development services to government and business
organizations. The Company also directly provided telecommunications services to
businesses and households through the ownership and operation of telephone
operating companies ("TELCOs") in certain rural areas of the United States. The
Company began to withdraw from the contract services market during 1994 and it
sold the TELCO operations during 1994.
-10-
<PAGE>
Since its inception, the Company has expended substantial sums to
develop its proprietary and patented technologies and establish and upgrade
the patent portfolio owned by ITC, to develop and commercialize products
delivering the advantages afforded by its technologies and to establish a market
for those products. The Company had an accumulated deficit of $150.3 million as
of December 31, 1995.
The Company was incorporated in Pennsylvania in 1972 and its principal
executive offices are located at 781 Third Avenue, King of Prussia, Pennsylvania
19406-1409. The Company's telephone number is (610) 878-7800. As used herein and
unless otherwise required by the context, the "Company" shall mean InterDigital
Communications Corporation and its direct and indirect majority-owned
subsidiaries.
SELLING SHAREHOLDERS
The following table sets forth the names of the Selling Shareholders and
certain information regarding the beneficial ownership of the Company's Common
Stock by the Selling Shareholders as of February 1, 1996, and as adjusted to
reflect the sale of the shares offered by this Prospectus:
<TABLE>
<CAPTION>
Beneficial Ownership
After Offering
------------------------------
Number of
Shares Percent of
Beneficially Number of Class (if
Owned Prior to Shares Number of greater
Name Offering Offered Shares than 1%)
- ---- -------------- ---------- ---------- -----------
<S> <C> <C> <C> <C>
Bankers Trust 227,921(1) 227,921(1) -- --
Bear Stearns 216,503(2) 180,303(3) 36,200 --
Bergman Lior 62,500(4) 62,500(4) -- --
Blacconeri Agency 28,502(31) 6,751(32) 21,751 --
Margaret S. Bracknell 840(5) 420(6) 420 --
Phyllis M. Buffardi 40,202(7) 13,951(8) 26,251 --
Michael A. Burns 389,052(9) 97,972(10) 291,080 --
Jeffrey S. Burns 389,052(9) 97,972(10) 291,080 --
David A. Burns 467,883(11) 97,973(12) 369,910 --
James Cacioppo 170,000(13) 170,000(13) -- --
John T. Gregorio, Jr 54,208(14) 11,901(15) 42,307 --
Ronald J. Gregorio 239,249(16) 16,400(17) 222,849 --
Integrated
Telecommunications 7,500(18) 7,500(18) -- --
JMG Capital Partners,
L.P. 67,050(19) 10,000(20) 57,050 --
-11-
<PAGE>
Lehman Brothers 339,116(21) 339,116(21) -- --
Robert Metcalf 42,000(22) 10,000(22) 32,000 --
Paresco, Inc. 629,867(23) 415,921(24) 213,946 --
Stanley Stern 12,500(25) 12,500(25) -- --
Taft Securities 442,500(26) 5,000(27) 437,500 --
Jeffrey Thorp 11,000(28) 11,000(28) -- --
Robert C. Wolf 48,837(29) 15,602(30) 33,235 --
</TABLE>
- ----------------------------------
1. Consists of shares issuable upon the exercise of a warrant to purchase
such shares at an exercise price of $4.39 per share which expires on April
10, 2002.
2. Consists of shares issuable upon the exercise of warrants. Bear Stearns
also owns options to sell 20,000 shares at exercise prices ranging from
$7.50 to $10.00 which expire in June 1996.
3. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $4.39 to $4.55 per share which
expire on dates ranging from April 10, 2002 to April 14, 2002.
4. Consists of shares issuable upon the exercise of a warrant to purchase
such shares at an exercise price of $8.18 per share which expires on
December 11, 1997.
5. Consists of shares issuable upon the exercise of warrants.
6. Consists of shares issuable upon the exercise of a warrant to purchase
such shares at an exercise price of $6.53 per share which expires on March
9, 1997.
7. Includes 35,202 shares issuable upon the exercise of warrants.
8. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $4.39 to $8.625 per share which
expire on dates ranging from December 5, 1997 to May 8, 2002.
9. Includes 1,500 shares issuable upon the exercise of warrants owned by
Southern Illinois, a company owned by David A. Burns, Jeffrey S. Burns and
Michael A. Burns, who are Selling Shareholders, as well as 289,580 shares
issuable upon the exercise of warrants owned jointly by David A. Burns,
Jeffrey S. Burns and Michael A. Burns. Also includes 97,972 shares
issuable upon the exercise of warrants owned by the named Selling
Shareholder individually. The named Selling Shareholder is a son of
William J. Burns, the Chief Executive Officer of the Company and Chairman
of the Board of the Company.
-12-
<PAGE>
10. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $4.39 to $8.625 per share which
expire on dates ranging from December 5, 1997 and May 19, 2004.
11. Includes 1,500 shares issuable upon the exercise of warrants owned by
Southern Illinois, a company owned by David A. Burns, Jeffrey S. Burns and
Michael A. Burns, who are Selling Shareholders, as well as 289,580 shares
issuable upon the exercise of warrants owned jointly by David A. Burns,
Jeffrey S. Burns and Michael A. Burns. Also includes 176,803 shares
issuable upon the exercise of warrants owned by the named Selling
Shareholder individually. The named Selling Shareholder is a son of
William J. Burns, the Chief Executive Officer of the Company and Chairman
of the Board of the Company.
12. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $4.39 to $8.625 per share which
expire on dates ranging from December 5, 1997 and May 19, 2004.
13. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $4.39 to $5.875 per share which
expire on dates ranging from December 5, 1997 to April 24, 2002.
14. Includes 44,208 shares issuable upon the exercise of warrants.
15. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $4.39 to $8.625 per share which
expire on dates ranging from December 5, 1997 to May 8, 2002.
16. Includes 194,014 shares issuable upon the exercise of options and
warrants. Also includes 25,235 shares issuable upon the exercise of
warrants owned by Mid-Co Mortgage Service (with respect to which Mid-Co
Mortgage Service disclaims beneficial ownership of 10,234 shares). Mr.
Gregorio is a co-owner of Mid-Co Mortgage Service.
17. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $4.39 to $8.625 which expire on
dates ranging from December 5, 1997 to April 24, 2002.
18. Consists of shares issuable upon the exercise of a warrant to purchase
such shares at an exercise price of $4.375 which expires on March 22,
2004.
19. Consists of shares issuable upon the exercise of warrants.
20. Consists of shares issuable upon the exercise of a warrant to purchase
such shares at an exercise price of $7.75 which expires on November 11,
1996.
21. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $4.47 to $5.50 which expire on
dates ranging from April 13, 2002 to April 24, 2002.
22. Includes 10,000 shares issuable upon the exercise of a warrant to purchase
such shares at an exercise price of $4.39 per share which expires on April
24, 2002.
23. Consists of shares issuable upon the exercise of warrants.
-13-
<PAGE>
24. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $4.39 to $5.75 per share which
expire on dates ranging from April 16, 2000 and December 21, 2002.
25. Consists of shares issuable upon the exercise of a warrant to purchase
such shares at an exercise price of $8.18 per share which expires on
December 11, 1997.
26. Consists of shares issuable upon the exercise of warrants.
27. Consists of shares issuable upon the exercise of a warrant to purchase
such shares at $5.75 per share which expires on May 16, 2000.
28. Consists of shares issuable upon the exercise of a warrant to purchase
such shares at $8.10 per share which expires on December 1, 1999.
29. Includes 23,602 shares issuable upon the exercise of warrants. Also
includes 25,235 shares issuable upon the exercise of warrants owned by
Mid-Co Mortgage Service (with respect to which Mid-Co Mortgage Service
disclaims beneficial ownership of 10,234 shares). Mr. Wolf is a co-owner
of Mid-Co Mortgage Service.
30. Consists of shares issuable upon the exercise of warrants to purchase such
shares at exercise prices ranging from $5.875 per share to $8.625 per
share which expire on dates ranging from December 5, 1997 and April 23,
2002.
31. Consists of shares issuable upon the exercise of warrants.
32. Consists of shares issuable upon the exercise of a warrant to purchase
such shares at $5.875 per share which expires on December 5, 1997.
The Selling Shareholders or their pledgees, donees, transferees or other
successors in interest, may sell all, a portion or none of the securities
offered by them hereby from time to time. Any such sales may be in one or more
transactions on the AMEX at prices prevailing at the times of such sales or in
private sales of the securities at prices related to the prevailing market
prices or negotiated prices. The sales may involve (a) a block transaction in
which the broker or dealer so engaged will attempt to sell the shares as agent
but may position and resell a portion of the block as principal to facilitate
the transaction, (b) a purchase by a broker or dealer as principal and resale by
such broker or dealer for its account pursuant to this Prospectus, (c) ordinary
brokerage transactions in which the broker solicits purchasers, or (d) short
sales of Common Stock which may be deemed to be sales of the shares offered
hereby. Broker-dealers may receive compensation in the form of underwriting
discounts, concessions or commissions (which compensation may be in excess of
customary commissions). The Selling Shareholders and any broker-dealers that
participate in the distribution of the shares may be deemed to be underwriters
and any commissions received by them and any profit on the resale positioned by
them might be deemed to be underwriting discounts and commissions under the
Securities Act of 1933.
There can be no assurance that the Selling Shareholders will sell any or
all of their shares of Common Stock offered hereby. There can be no assurance
that short sales of the Common Stock by Selling Shareholders hereunder will not
have an adverse market impact on the current market price of the Common Stock.
The Company will receive no proceeds from any sales of Common Stock hereunder by
the Selling Shareholders.
-14-
<PAGE>
In connection with their acquisition of their shares of Common Stock and
the Warrants, the Company granted to certain of the Selling Shareholders certain
registration rights and agreed to certain indemnification and payment
obligations as discussed below. The Registration Statement of which this
Prospectus is a part has been filed with the Commission pursuant to the exercise
by those Selling Shareholders of such registration rights. The Company has
agreed to pay the filing fees, costs and expenses associated with such
Registration Statement, including compliance with any state blue sky
requirements. The Company has also agreed to indemnify certain Selling
Shareholders, and to the extent applicable, their officers, directors and
controlling persons, and any underwriters, for certain civil liabilities in
connection with such Registration Statement and the securities offered thereby
and hereby, including liabilities under the Securities Act of 1933.
LEGAL MATTERS
The validity of the Common Stock offered hereby has been passed upon for
the Company by Jane S. Schultz, Esq., 781 Third Avenue, King of Prussia,
Pennsylvania 19406. Ms. Schultz is Associate General Counsel of the Company. As
of the date of this Prospectus, Ms. Schultz owns options to purchase 1,666
shares of Common Stock which are currently vested and exercisable.
EXPERTS
The consolidated financial statements and schedules of the Company for
each of the three years in the period ended December 31, 1995 incorporated in
this Prospectus by reference have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their report with respect
thereto and are incorporated by reference herein in reliance upon the authority
of said firm as experts in giving said report.
-15-
<PAGE>
No dealer, salesman or other person has been authorized to give any information
or to make any representations other than those contained in this Prospectus in
connection with the offer made hereby, and, if given or made, such information
or representations must not be relied upon as having been authorized by the
Company. This Prospectus does not constitute an offer to sell, or a solicitation
of an offer to buy, the securities offered hereby to any person in any state or
other jurisdiction in which such offer or solicitation is unlawful. The delivery
of this Prospectus at any time does not imply that information contained herein
is correct as of any time subsequent to its date.
-------------------
TABLE OF CONTENTS
Page
Risk Factors............................................. 1
Available Information.................................... 8
Incorporation of Certain
Documents by Reference............................... 9
The Company.............................................. 9
Selling Shareholders..................................... 11
Legal Matters............................................ 15
Experts.................................................. 15
INTERDIGITAL
COMMUNICATIONS
CORPORATION
---------------
PROSPECTUS
---------------
-----------, 1996
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
SEC registration fee.......................... $ 5,464 *
Accounting fees and expenses.................. $ 1,500 **
Legal fees and expenses....................... $ 10,000 **
Miscellaneous................................. $ 36 **
Total.................................... $ 17,000 **
- ----------------
* Actual
** Estimated for the 12-month period commencing April 1, 1996.
Item 15. Indemnification of Directors and Officers
Sections 1741-1750 of the Pennsylvania Business Corporation Law of 1988
(the "BCL"), Section 8365 of Title 42 of the Pennsylvania Consolidated Statutes
("Section 8365") and the Company's By-Laws provide for indemnification of the
Company's directors and officers and certain other persons. Under Sections
1741-1750 of the BCL, directors and officers of the Company may be indemnified
by the Company against all expenses incurred in connection with actions
(including, under certain circumstances, derivative actions) brought against
such director or officer by reason of his or her status as a representative of
the Company, or by reason of the fact that such director or officer serves or
served as a representative of another entity at the Company's request, so long
as the director or officer acted in good faith and in a manner he or she
reasonably believed to be in, or not opposed to, the best interests of the
Company. As permitted under Section 1741-1750 of the BCL and Section 8365, the
Company's By-Laws provide that the Company shall indemnify directors and
officers against all expenses incurred in connection with actions (including
derivative actions) brought against such director or officer by reason of the
fact that he or she is or was a director or officer of the Company, or by reason
of the fact that such director or officer serves or served as an employee or
agent of any entity at the Company's request, unless the act or failure to act
on the part of the director or officer giving rise to the claim for
indemnification is determined by a court in a final, binding adjudication to
have constituted willful misconduct or recklessness.
Reference is made to Item 17 of this Registration Statement for
additional information regarding indemnification of directors and officers.
Item 16. Exhibits
5 Opinion of Jane S. Schultz, Esq.
**24.1 Consent of Arthur Andersen LLP.
II-1
<PAGE>
24.3 Consent of Jane S. Schultz, Esq. (included in Exhibit 5).
**25 Power of Attorney
- ---------------
** Previously filed.
Item 17. Undertakings.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the Company pursuant to the provisions discussed in Item 15 of this
Registration Statement, or otherwise, the Company has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Company of expenses incurred or paid by a director,
officer or controlling person of the Company in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person with the securities being registered, the Company will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
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 Act; (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 and 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 20 percent
change in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement); and (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 clauses
(i) and (ii) above do not apply if the information required to be included in a
post-effective amendment by those clauses is contained in periodic reports filed
by the Company pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this Registration
Statement; (2) that, for the purpose of determining any liability under the Act,
each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof; and (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.
The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the Company's annual
report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act
of 1934 that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
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 Amendment No. 1 to
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in King of Prussia, Pennsylvania, on May 9, 1996.
INTERDIGITAL COMMUNICATIONS
CORPORATION
By: /s/ William A. Doyle
---------------------------------------------
William A. Doyle, President and Acting Chief
Executive Officer, the principal executive
officer
By: /s/ James W. Garrison
---------------------------------------------
James W. Garrison, Vice President, Chief
Financial Officer and Treasurer, the principal
financial officer and principal accounting
officer
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 1 to Registration Statement has been signed by the following
persons on May 9, 1996 in the capacities indicated.
/s/ William A. Doyle
------------------------------------------------
William A. Doyle, President and Acting Chief
Executive Officer, the principal executive
officer
[EXECUTIONS CONTINUED]
II-3
<PAGE>
/s/ James W. Garrison
---------------------------------------------
James W. Garrison, Vice President, Chief
Financial Officer and Treasurer, the principal
financial officer and principal accounting
officer
*
--------------------------------------------
Barney J. Cacioppo, Director
*
-------------------------------------------
D. Ridgely Bolgiano, Director
*
-------------------------------------------
Harry G. Campagna, Director
*
-------------------------------------------
Harley L. Sims, Director
* By: /S/ WILLIAM A. DOYLE
-------------------------------------------
William A. Doyle
Attorney-in-Fact
<PAGE>
May 9, 1996
Interdigital Communications Corporation
2200 Renaissance Boulevard
Suite 105
King of Prussia, Pennsylvania 19406
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
Reference is made to a Registration Statement on Form S-3 of
InterDigital Communications Corporation (the "Company"), Registration No.
333-02345, to which this opinion is attached as an exhibit (the "Registration
Statement"). Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Registration Statement. The Registration
Statement covers 1,810,703 shares of Common Stock of the Company (the "Warrant
Shares") which may be sold by the Selling Shareholders.
I have examined the Registration Statement, including the exhibits
thereto, the Company's Articles of Incorporation, as amended, the Company's
By-laws and such other documents as I have deemed appropriate. In the foregoing
examination, I have assumed the genuineness of all signatures, the authenticity
of all documents submitted to me as originals and the authenticity of all
documents submitted to me as copies of originals.
Based upon such examination, I am of the opinion that when there has
been compliance with the Act and applicable state securities laws, the Warrant
Shares, when issued and paid for upon exercise of the Warrants, will be validly
issued, fully paid and nonassessable.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to me under the caption "Legal
Opinions" in the Prospectus. On giving this consent, I do not thereby admit that
I am within the category of persons whose consent is required under Section 7 of
the Act or rules and regulations of the Commission thereunder.
The undersigned is Associate General Counsel of the Company and
benefically owns options to purchase 1,666 shares of Common Stock which are
currently vested and exercisable.
Very truly yours,
/S/ JANE S. SCHULTZ
-------------------------
Jane S. Schultz
Associate General Counsel
<PAGE>
