<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 17, 2000
REGISTRATION NO. 333-
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------------
PROXIM, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
DELAWARE 77-0059429
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
</TABLE>
-------------------------
510 DEGUIGNE DRIVE
SUNNYVALE, CALIFORNIA 94086
(408) 731-2700
(ADDRESS, INCLUDING ZIP CODE AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
-------------------------
DAVID C. KING
PRESIDENT AND CHIEF EXECUTIVE OFFICER
510 DEGUIGNE DRIVE
SUNNYVALE, CA 94086
(408) 731-2700
(NAME, ADDRESS, INCLUDING ZIP CODE AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
AGENT FOR SERVICE)
-------------------------
COPIES TO:
JEFFREY D. SAPER, ESQ.
ROBERT G. DAY, ESQ.
WILSON SONSINI GOODRICH & ROSATI
PROFESSIONAL CORPORATION
650 PAGE MILL ROAD
PALO ALTO, CA 94304
(650) 493-9300
FAX: (650) 493-6811
-------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 (the "Securities Act"), other than securities offered only in connection
with dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, 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. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<S> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
PROPOSED PROPOSED
MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED BE REGISTERED PER SHARE(1) OFFERING PRICE(1) FEE
------------------------------------------------------------------------------------------------------------------------------
Common Stock, par value $.001
per share................... 218,976 $54.75 $11,988,936.00 $3,166.00
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The price of $54.75 per share, which was the average of the high and low
prices of the Registrant's Common Stock on the Nasdaq National Market on
November 13, 2000, is set forth solely for the purposes of calculating the
registration fee in accordance with Rule 457(c) of the Securities Act of
1933, as amended.
------------------------------
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 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SECTION
8(a), MAY DETERMINE.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE> 2
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
PROSPECTUS
(SUBJECT TO COMPLETION DATED NOVEMBER 17, 2000)
218,976 Shares
PROXIM, INC.
Common Stock
-------------------------
This prospectus relates to the public offering, which is not being
underwritten, of up to 218,976 shares of our Common Stock which is held by one
of our current stockholders. The selling stockholder identified in this
prospectus acquired his shares of our Common Stock in a private transaction in
which Proxim acquired Farallon Communications, Inc., a Delaware corporation.
The prices at which such stockholder may sell the shares will be determined
by the prevailing market price for the shares or in negotiated transactions. We
will not receive any of the proceeds from the sale of the shares.
Our Common Stock is listed on the Nasdaq National Market under the symbol
"PROX." On November 16, 2000, the closing price for our Common Stock was $58.375
per share.
-------------------------
INVESTING IN THE COMMON STOCK INVOLVES CERTAIN RISKS. SEE "RISK FACTORS"
BEGINNING ON PAGE 3.
-------------------------
THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE
NOT APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS
IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
-------------------------
The date of this Prospectus is November , 2000.
<PAGE> 3
No person has been authorized to give any information or to make any
representations other than those contained in this prospectus in connection with
the offering made hereby, and if given or made, such information or
representations must not be relied upon as having been authorized by Proxim,
Inc. (referred to in this prospectus as "Proxim," the "Company" and "we"), any
selling stockholder or by any other person. Neither the delivery of this
prospectus nor any sale made hereunder shall, under any circumstances, create
any implication that information herein is correct as of any time subsequent to
the date hereof. This prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any security other than the securities covered
by this prospectus, nor does it constitute an offer to or solicitation of any
person in any jurisdiction in which such offer or solicitation may not lawfully
be made.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information
on the public conference rooms. Our SEC filings are also available to the public
from the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information filed with the
SEC will update and supersede this information. We incorporate by reference the
documents listed below and any future filings made with the SEC under Section
13a, 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until our
offering is completed.
(1) Proxim's Annual Report on Form 10-K, for the year ended December 31,
1999;
(2) Proxim's Quarterly Report on Form 10-Q for the quarter ended March 31,
2000;
(3) Proxim's Quarterly Report on Form 10-Q for the quarter ended June 30,
2000;
(4) Proxim's Quarterly Report on Form 10-Q for the quarter ended September
30, 2000;
(5) Proxim's Current Report on Form 8-K, filed with the Commission on
January 6, 2000;
(6) Proxim's Amended Current Report on Form 8-K/A, filed with the
Commission on February 16, 2000; and
(7) The description of our Common Stock contained in our Registration
Statement on Form 8-A, filed with the Commission on October 21, 1993.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Keith E. Glover
Vice President, Finance and Chief Financial Officer
Proxim, Inc.
510 DeGuigne Drive
Sunnyvale, California 94086
(408) 731-2700
You should rely only on the information incorporated by reference or
provided in this prospectus or the prospectus supplement. We have authorized no
one to provide you with different information.
1
<PAGE> 4
We are not making an offer of these securities in any state where the offer is
not permitted. You should not assume that the information in this prospectus or
the prospectus supplement is accurate as of any date other than the date on the
front of the document.
PROXIM
Proxim designs, manufactures and markets high performance wireless local
area networking, or LAN, products based on radio frequency, or RF, technology.
Proxim's highly integrated wireless client adapters and network infrastructure
systems seamlessly extend existing enterprise LANs to enable mobility-driven
applications in a wide variety of in-building and campus area environments.
Introduced in 1994, Proxim's RangeLAN2(TM) 2.4 GHz wireless LAN technology has
been adopted by a number of major mobile computer system and handheld data
terminal manufacturers, as well as many leading wireless solution providers, for
real-time data collection applications in manufacturing, warehousing,
transportation and retailing and for point-of-service network applications in
healthcare, hospitality, education and financial services.
FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated herein by reference contain
forward-looking statements within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act. Words such as "anticipates," "expects,"
"intends," "plans," "believes," "seeks," "estimates," variations of such words
and similar expressions are intended to identify such forward-looking
statements. These statements are not guarantees of future performance and are
subject to certain risks, uncertainties and assumptions that are difficult to
predict. Therefore, actual results could differ materially from those expressed
or forecasted in any such forward-looking statements as a result of certain
factors, including those set forth in "Risk Factors," as well as those noted in
the documents incorporated herein by reference. In connection with
forward-looking statements which appear in these disclosures, investors should
carefully review the factors set forth in this prospectus under "Risk Factors."
2
<PAGE> 5
RISK FACTORS
You should carefully consider the risks described below before making an
investment decision. The risks and uncertainties described below are not the
only ones facing our company. Additional risks and uncertainties not presently
known to us or that we currently deem immaterial may also impair our business
operations.
If any of the following risks actually occur, our business, financial
condition or results of operations could be materially adversely affected. In
such case, the trading price of our common stock could decline and you could
lose all or part of your investment.
This prospectus also contains forward-looking statements that involve risks
and uncertainties. Our actual results could differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including the risks faced by us described below and elsewhere in this
prospectus.
OUR OPERATING RESULTS ARE LIKELY TO FLUCTUATE SIGNIFICANTLY AND MAY FAIL TO MEET
OR EXCEED THE EXPECTATIONS OF SECURITIES ANALYSTS OR INVESTORS, CAUSING OUR
STOCK PRICE TO DECLINE.
Our operating results have fluctuated in the past and are likely to
continue to fluctuate in the future on an annual and quarterly basis, due to
numerous factors, many of which are outside of our control. Some of the factors
that may cause these fluctuations include:
- changing market demand for, and declines in the average selling prices
of, our products;
- the timing of and delays or cancellations of significant orders from
major customers;
- the loss of one or more of our major customers;
- the cost, availability and quality of components from our suppliers;
- the cost, availability, and quality of assemblies from contract and
subcontract manufacturers;
- the lengthy sales and design-in cycles for original equipment
manufacturer, or OEM, products;
- delays in the introduction of our new products;
- competitive product announcements and introductions;
- market adoption of new technologies;
- market adoption of radio frequency, or RF, standards-based products (such
as those compliant with the IEEE 802.11 or the Home RF SWAP
specifications);
- the mix of products sold;
- the effectiveness of our distribution channels and our success in
maintaining our current distribution channels and developing new
distribution channels;
- the sell-through rate of our Symphony products through consumer retail
channels;
- management of retail channel inventories;
- excess and obsolete inventories related to evolving product technologies
and industry standards;
- the failure to anticipate changing customer product requirements;
3
<PAGE> 6
- seasonality in demand;
- manufacturing capacity and efficiency;
- changes in the regulatory environment, product health and safety
concerns; and
- general economic conditions.
Historically, we have not operated with a significant order backlog and a
substantial portion of our revenue in any quarter has been derived from orders
booked and shipped in that quarter. Accordingly, our revenue expectations are
based almost entirely on internal estimates of future demand and not on firm
customer orders. Planned operating expense levels are relatively fixed in the
short term and are based in large part on these estimates. If orders and revenue
do not meet expectations, our operating results could be materially adversely
affected. In this regard, in the third quarter of 1997, we experienced a
decrease in revenue and an operating loss as a result of a significant decrease
in orders from two of our major customers. We can offer no assurance that we
will not experience future quarter to quarter decreases in revenue or quarterly
operating losses. In addition, due to the timing of orders from OEM customers,
we have often recognized a substantial portion of our revenue in the last month
of a quarter. As a result, minor fluctuations in the timing of orders and the
shipment of products have caused, and may in the future cause, operating results
to vary significantly from quarter to quarter.
WE DEPEND SIGNIFICANTLY ON A LIMITED NUMBER OF OEM CUSTOMERS.
A substantial portion of our revenue has been derived from a limited number
of customers, most of which are OEM customers. Approximately 43%, 52% and 59% of
our sales during the first nine months of 2000, and calendar years 1999 and
1998, respectively, were to OEM customers. In addition, sales to one customer
represented approximately 13% of our revenue in the first nine months of 2000.
Sales to one customer represented approximately 30% of our revenue during 1999.
Sales to two customers represented approximately 41% and 11% of our revenue
during 1998. We expect that sales to a limited number of OEM customers will
continue to account for a substantial portion of our revenue for the foreseeable
future. We also have experienced quarter to quarter variability in sales to each
of our major OEM customers and expect this pattern to continue in the future.
Sales of many of our wireless networking products depend upon the decision
of a prospective OEM customer to develop and market wireless solutions, which
incorporate our wireless technology. OEM customers' orders are affected by a
variety of factors, including the following:
- new product introductions;
- regulatory approvals;
- end-user demand for OEM customers' products;
- product life cycles;
- inventory levels;
- manufacturing strategies;
- pricing;
- contract awards;
4
<PAGE> 7
- competitive situations; and
- general economic conditions.
For these and other reasons, the design-in cycle associated with the
purchase of our wireless products by OEM customers is quite lengthy, generally
ranging from six months to two years, and is subject to a number of significant
risks, including customers' budgeting constraints and internal acceptance
reviews, that are beyond our control. Because of the lengthy sales cycle, we
typically plan our production and inventory levels based on internal forecasts
of OEM customer demand, which is highly unpredictable and can fluctuate
substantially. In addition, our agreements with OEM customers typically do not
require minimum purchase quantities and a significant reduction, delay or
cancellation of orders from any of these customers could materially and
adversely affect our operating results. If revenue forecasted from a specific
customer for a particular quarter is not realized in that quarter, our operating
results for that quarter could be materially adversely affected. The loss of one
or more of, or a significant reduction in orders from, our major OEM customers
could materially and adversely affect our operating results. In addition, we can
offer no assurance that we will become a qualified supplier for new OEM
customers or that we will remain a qualified supplier for existing OEM
customers.
WE PURCHASE SEVERAL KEY COMPONENTS USED IN THE MANUFACTURE OR INTEGRATION OF OUR
PRODUCTS FROM SOLE OR LIMITED SOURCES.
Certain parts and components used in our products, including our
proprietary application specific integrated circuits, or ASICs, monolithic
microwave integrated circuits, or MMICs, and assembled circuit boards, are only
available from single sources, and certain other parts and components are only
available from a limited number of sources. Our reliance on these sole source or
limited source suppliers involves risks and uncertainties, including the
following:
- the possibility of a shortage or discontinuation of key components; and
- reduced control over delivery schedules, manufacturing capability,
quality, yields and costs.
Any reduced availability of these parts or components when required could
significantly impair our ability to manufacture and deliver our products on a
timely basis and result in the cancellation of orders, which could materially
adversely affect our operating results. In addition, the purchase of some key
components involves long lead times and, in the event of unanticipated increases
in demand for our products, we have in the past been, and may in the future be,
unable to manufacture some products in a quantity sufficient to meet our
customers' demand in any particular period. We have no guaranteed supply
arrangements with our sole or limited source suppliers, do not maintain an
extensive inventory of parts or components, and customarily purchase sole or
limited source parts and components pursuant to purchase orders placed from time
to time in the ordinary course of business. Business disruptions, production
shortfalls, production quality or financial difficulties of a sole or limited
source supplier could materially and adversely affect our business by increasing
product costs, or reducing or eliminating the availability of parts or
components. In an event like this, our inability to develop alternative sources
of supply quickly and on a cost-effective basis could significantly impair our
ability to manufacture and deliver our products on a timely basis and could
materially adversely affect our business and operating results.
5
<PAGE> 8
WE NEED TO EXPAND OUR LIMITED MANUFACTURING CAPABILITY AND INCREASINGLY DEPEND
ON CONTRACT MANUFACTURERS FOR OUR MANUFACTURING REQUIREMENTS.
We currently have limited manufacturing capability and no experience in
large-scale or foreign manufacturing. If our customers were to concurrently
place orders for unexpectedly large product quantities, our present
manufacturing capacity might be inadequate to meet the demand. We can offer no
assurance that we will be able to develop or contract for additional
manufacturing capacity on acceptable terms on a timely basis. In addition, in
order to compete successfully, we will need to achieve significant product cost
reductions. Although we intend to achieve cost reductions through engineering
improvements, production economies, and manufacturing at lower cost locations
including outside the United States, we can offer no assurance that we will be
able to do so. In order to remain competitive, we also must continue to
introduce new products and processes into our manufacturing environment, and we
can offer no assurance that any such new products will not create obsolete
inventories related to older products. We currently conduct our manufacturing
operations for all of our products in our corporate headquarters in Sunnyvale,
California. In addition, we rely on contract and subcontract manufacturers for
turnkey manufacturing and circuit board assemblies which subjects us to
additional risks, including a potential inability to obtain an adequate supply
of finished assemblies and assembled circuit boards and reduced control over the
price, timely delivery and quality of such finished assemblies and assembled
circuit boards. If our Sunnyvale facility were to become incapable of operating,
even temporarily, or were unable to operate at or near our current or full
capacity for an extended period, our business and operating results could be
materially adversely affected. Changes in our manufacturing operations to
incorporate new products and processes, or to manufacture at lower cost
locations outside the United States, could cause disruptions, which, in turn,
could adversely affect customer relationships, cause a loss of market
opportunities and negatively affect our business and operating results.
We have in the past experienced higher than expected demand for our
products. This resulted in delays in the delivery of certain products due to
temporary shortages of certain components, particularly components with long
lead times, and insufficient manufacturing capacity. Due to the complex nature
of our products and manufacturing processes, the worldwide demand for some
wireless technology components and other factors, we can offer no assurance that
delays in the delivery of products will not occur in the future.
WIRELESS COMMUNICATIONS AND NETWORKING MARKETS ARE SUBJECT TO RAPID
TECHNOLOGICAL CHANGE AND TO COMPETE, WE MUST CONTINUALLY INTRODUCE NEW PRODUCTS
THAT ACHIEVE BROAD MARKET ACCEPTANCE.
The wireless communications industry is characterized by rapid
technological change, short product life cycles and evolving industry standards.
To remain competitive, we must develop or gain access to new technologies in
order to increase product performance and functionality, reduce product size and
maintain cost-effectiveness.
Our success is also dependent on our ability to develop new products for
existing and emerging wireless communications markets, to introduce such
products in a timely manner and to have them designed into new products
developed by OEM customers. The development of new wireless networking products
is highly complex, and, from time to time, we have experienced delays in
developing and introducing new products. Due to the intensely competitive nature
of our business, any delay in the commercial availability of new products could
materially and adversely affect our business, reputation and operating results.
In addition, if we are unable to develop or obtain access to advanced wireless
networking technologies as they become available, or are unable to design,
develop and introduce competitive new products on a timely basis, or are unable
to hire or retain qualified
6
<PAGE> 9
engineers to develop new technologies and products, our future operating results
would be materially and adversely affected. We have expended substantial
resources in developing products that are designed to conform to the IEEE 802.11
standard that received final approval in June 1997. We can offer no assurance,
however, that our IEEE 802.11 compliant products or the IEEE 802.11 standard
will have a meaningful commercial impact. In this regard, in the second quarter
of 2000, we recorded a charge of $1,859,000 to cost of revenue related to first
generation IEEE 802.11 inventories.
In 1999, the IEEE approved a new 2.4 GHz wireless LAN standard, designated
as 802.11b. Based on direct sequence spread spectrum technology, this new
standard increased the nominal data rate from 2 Mbps to 11 Mbps. We are
currently developing products that comply with the IEEE 802.11b standard. While
802.11b technology is available to develop or acquire in the market, there can
be no assurance that we will develop or acquire such technology, or that if we
do develop or acquire such technology, that our products will be competitive in
the market. In addition, we are developing higher-speed frequency hopping
technology based on the FCC Notice of Proposed Rulemaking, or NPRM, that will
allow for wider band hopping channels and increase the data rate from 1.6 Mbps
to up to 10 Mbps. In August 2000, the FCC approved the NPRM that will enable the
development of wide band frequency-hopping systems operating in the unlicensed
2.4 GHz band. There can be no assurance that we will be able to complete our
development of HomeRF wideband frequency-hopping products in a timely manner, or
that any such new products will compete effectively with IEEE 802.11b standard
compliant products.
The IEEE has approved a new 5 GHz wireless LAN standard designated as
802.11a. This new standard is based on Orthogonal Frequency Division
Multiplexing, or OFDM, technology with multiple data rates ranging from below 10
Mbps to approximately 50 Mbps. In 1999, the European Telecommunications
Standards Institute Project BRAN (Broadband Radio Access Networks) committee
approved a new 5 GHz wireless LAN standard designated as HiperLAN2, also based
on OFDM technology. While these two new 5 GHz standards apply to future
generations of technology, and no companies are currently shipping wireless LAN
products based on these technologies, the emergence of these standards may
diminish the competitiveness of our planned introduction of 5 GHz products based
on the HiperLAN1 standard. Furthermore, we are not currently developing products
based on either of these two new standards, and there can be no assurance that
we will develop or acquire technology compliant with these standards.
In addition, we are a core member of the HomeRF WG, an industry consortium
that is establishing an open industry standard, called the SWAP specification,
for wireless digital communications between PCs and consumer electronic devices,
including a common interface specification that supports wireless data and voice
services in and around the home. We can offer no assurance that the HomeRF WG
SWAP specification, or the SWAP-based Symphony and HomeRF wideband
frequency-hopping products that we develop to comply with the specification will
have a meaningful commercial impact. Further, given the emerging nature of the
wireless LAN market, we can offer no assurance that our RangeLAN2 and Symphony
products and technology, or our other products or technology, will not be
rendered obsolete by alternative or competing technologies or standards.
If we are unable to enter a particular market in a timely manner with
internally developed products, we may license technology from other businesses
or acquire other businesses as an alternative to internal research and
development. In this regard, in the fourth quarter of 1997, we recorded a charge
of $2,500,000 to in-process research and development related to a license of
technology to be used in 5 GHz highspeed in-building wireless LAN products. In
1999, we recorded a total of $7,883,000 in charges related to the acquisition of
5 GHz ultra-broadband wireless building-to-building products. In second quarter
of 2000, we recorded a charge of $491,000 related to acquisition of products
that address home and small office networking requirements, as well as Apple
7
<PAGE> 10
Macintosh computer connectivity. In the third quarter of 2000, we recorded a
charge of $8,040,000 related to the acquisition of HomeRF products.
THE WIRELESS LOCAL AREA NETWORKING AND BUILDING TO BUILDING MARKETS ARE
INTENSELY COMPETITIVE AND SOME OF OUR COMPETITORS ARE LARGER AND BETTER
ESTABLISHED.
The wireless local area networking and building to building markets are
extremely competitive and we expect that competition will intensify in the
future. Increased competition could adversely affect our business and operating
results through pricing pressures, the loss of market share and other factors.
The principal competitive factors include the following:
- data throughput;
- effective RF coverage area;
- interference immunity;
- network scalability;
- price;
- integration with voice technology;
- wireless networking protocol sophistication;
- ability to support industry standards;
- roaming capability;
- power consumption;
- product miniaturization;
- product reliability;
- ease of use;
- product costs;
- product manufacturability;
- product features and applications;
- product time to market;
- product certifications;
- brand recognition;
- OEM partnerships;
- marketing alliances;
- manufacturing capabilities and experience;
- effective distribution channels; and
- company reputation.
8
<PAGE> 11
We could be at a disadvantage to competitors, particularly Cisco Systems
and Lucent Technologies, that have broader distribution channels and brand
recognition, extensive patent portfolios and more diversified product lines.
We have several competitors in our commercial wireless business, including
without limitation Breezecom, Cisco Systems (which acquired Aironet Wireless
Communications), Intersil, Lucent Technologies, Nokia, Symbol Technologies,
Western Multiplex and 3COM. We also face competition from a variety of companies
that offer different technologies in the nascent home networking market,
including several companies developing competing wireless networking products.
Additionally, numerous companies have announced their intention to develop
competing products in both the commercial wireless and home networking markets.
In addition to competition from companies that offer or have announced their
intention to develop wireless LAN products, we could face future competition
from companies that offer products which replace network adapters or offer
alternative communications solutions, or from large computer companies, PC
peripheral companies, as well as other large networking equipment companies.
Furthermore, we could face competition from certain of our OEM customers, which
have, or could acquire, wireless engineering and product development
capabilities. We can offer no assurance that we will be able to compete
successfully against these competitors or those competitive pressures we face
will not adversely affect our business or operating results.
Many of our present and potential competitors have substantially greater
financial, marketing, technical and other resources with which to pursue
engineering, manufacturing, marketing, and distribution of their products. These
competitors may succeed in establishing technology standards or strategic
alliances in the wireless LAN and building to building markets, obtain more
rapid market acceptance for their products, or otherwise gain a competitive
advantage. We can offer no assurance that we will succeed in developing products
or technologies that are more effective than those developed by our competitors.
Furthermore, we compete with companies that have high volume manufacturing and
extensive marketing and distribution capabilities, areas in which we have only
limited experience. We can offer no assurance that we will be able to compete
successfully against existing and new competitors as the wireless LAN and
building to building markets evolve and the level of competition increases.
WE DEPEND UPON INTERNATIONAL SALES AND OUR ABILITY TO SUSTAIN AND INCREASE
INTERNATIONAL SALES IS SUBJECT TO MANY RISKS, WHICH COULD ADVERSELY AFFECT OUR
OPERATING RESULTS.
Revenue from shipments by us to customers outside the United States,
principally to a limited number of distributors and OEM customers, represented
14%, 21% and 17% of total revenue during the first nine months of 2000, and
calendar years 1999 and 1998, respectively. We expect that revenue from
shipments to international customers will vary as a percentage of total revenue.
Sales to international customers or to U.S. OEM customers who ship to
international locations are subject to a number of risks and uncertainties
including:
- changes in foreign government regulations and telecommunications
standards;
- export license and documentation requirements;
- tariffs, duties taxes and other trade barriers;
- fluctuations in currency exchange rates;
- longer payment cycles for international distributors;
- difficulty in collecting accounts receivable;
9
<PAGE> 12
- competition from local manufacturers with lower costs;
- difficulty in staffing and managing foreign operations; and
- potential political and economic instability.
While international sales are typically denominated in U.S. dollars and we
typically extend limited credit terms, fluctuations in currency exchange rates
could cause our products to become relatively more expensive to customers in a
particular country, leading to a reduction in sales or profitability in that
country. We can offer no assurance that foreign markets will continue to develop
or that we will receive additional orders to supply our products to foreign
customers. Our business and operating results could be materially and adversely
affected if foreign markets do not continue to develop or if we do not receive
additional orders to supply our products for use by foreign customers. In the
latter part of 1997 and throughout 1998, capital markets in Asia were highly
volatile, resulting in fluctuations in Asian currencies and other economic
instabilities. In this regard, in the third quarter of 1997 and continuing
through the second quarter of 1998, we experienced a significant decrease in
orders from NTT-IT, one of our major Japanese customers, resulting in a
significant decrease in quarterly revenue and an operating loss in the third
quarter of 1997.
OUR FAILURE TO ADEQUATELY PROTECT OUR PROPRIETARY RIGHTS COULD ADVERSELY AFFECT
OUR ABILITY TO COMPETE EFFECTIVELY.
We rely on a combination of patents, trademarks, non-disclosure agreements,
invention assignment agreements and other security measures in order to
establish and protect our proprietary rights. We have been issued seven U.S.
patents, which were issued in 1991, 1993, 1995, 1998 and 1999, and are important
to our current business, and we have three patent applications pending in the
U.S., which relate to our core technologies and product designs. We can offer no
assurance that patents will issue from any of these pending applications or, if
patents do issue that the claims allowed will be sufficiently broad to protect
our technology. In addition, we can offer no assurance that any patents issued
to us will not be challenged, invalidated or circumvented, or that the rights
granted thereunder will adequately protect us. Since U.S. patent applications
are maintained in secrecy until patents issue, and since publication of
inventions in the technical or patent literature tends to lag behind such
inventions by several months, we cannot be certain that we first created the
inventions covered by our issued patents or pending patent applications or that
we were the first to file patent applications for such inventions or that we are
not infringing on the patents of others. In addition, we have filed, or reserved
our rights to file, a number of patent applications internationally. We can
offer no assurance that any international patent application will issue or that
the laws of foreign jurisdictions will protect our proprietary rights to the
same extent as the laws of the United States.
Although we intend to protect our rights vigorously, there can be no
assurance that the measures we have taken or may take to protect our proprietary
rights will be successful. Litigation may be necessary to enforce our patents,
trademarks or other intellectual property rights, to protect our trade secrets,
to determine the validity and scope of the proprietary rights of others, to
establish the validity of any technology licenses offered to patent infringers,
or to defend against claims of infringement. Litigation could result in
substantial costs and diversion of resources and could materially and adversely
affect our business and operating results. Moreover, we can offer no assurance
that in the future these rights will be upheld. Furthermore, there can be no
assurance that any of our issued patents will provide a competitive advantage or
will not be challenged by third parties or that the patents of others will not
adversely impact our ability to do business. As the number of products in the
wireless LAN market increases, and related features and functions overlap, we
may become increasingly subject to infringement claims. These claims also might
require us to enter into royalty or
10
<PAGE> 13
license agreements. Any such claims, with or without merit, could cause costly
litigation and could require significant management time. There can be no
assurance that, if required, we could obtain such royalty or license agreements
on terms acceptable to management. There can be no assurance that the measures
we have taken or may take in the future will prevent misappropriation of our
technology or that others will not independently develop similar products,
design around our proprietary or patented technology or duplicate our products.
WE NEED TO EFFECTIVELY MANAGE OUR GROWTH.
Our growth to date has caused, and will continue to cause, a significant
strain on our management, operational, financial and other resources. Our
ability to manage growth effectively will require us to improve our management,
operational and financial processes and controls as well as the related
information and communications systems. These demands will require the addition
of new management personnel and the development of additional expertise by
existing management. The failure of our management team to effectively manage
growth, should it occur, could materially and adversely affect our business and
operating results.
COMPLIANCE WITH GOVERNMENTAL REGULATIONS IN MULTIPLE JURISDICTIONS WHERE WE SELL
OUR PRODUCTS IS DIFFICULT AND COSTLY.
In the United States, we are subject to various Federal Communications
Commission, or FCC, rules and regulations. Current FCC regulations permit
license-free operation in certain FCC-certified bands in the radio spectrum. Our
spread spectrum wireless products are certified for unlicensed operation in the
902 - 928 MHz, 2.4 - 2.4835 GHz, 5.15 - 5.35 GHz and 5.725 - 5.825 GHz frequency
bands. Operation in these frequency bands is governed by rules set forth in Part
15 of the FCC regulations. The Part 15 rules are designed to minimize the
probability of interference to other users of the spectrum and, thus, accord
Part 15 systems secondary status in the frequency. In the event that there is
interference between a primary user and a Part 15 user, a higher priority user
can require the Part 15 user to curtail transmissions that create interference.
In this regard, if users of our products experience excessive interference from
primary users, market acceptance of our products could be adversely affected,
which could materially and adversely affecting our business and operating
results. The FCC, however, has established certain standards that create an
irrefutable presumption of noninterference for Part 15 users and we believe that
our products comply with such requirements. We can offer no assurance that the
occurrence of regulatory changes, including changes in the allocation of
available frequency spectrum, changes in the use of allocated frequency
spectrum, or modification to the standards establishing an irrefutable
presumption for unlicensed Part 15 users, would not significantly affect our
operations by rendering current products obsolete, restricting the applications
and markets served by our products or increasing the opportunity for additional
competition.
Our products are also subject to regulatory requirements in international
markets and, therefore, we must monitor the development of spread spectrum and
other radio frequency regulations in certain countries that represent potential
markets for our products. While we can offer no assurance that we will be able
to comply with regulations in any particular country, we design our RangeLAN2,
Symphony and SWAP-based Symphony products to minimize the design modifications
required to meet various 2.4 GHz international spread spectrum regulations. In
addition, we will seek to obtain international certifications for the Symphony
and SWAP-based Symphony product line in countries where there is a substantial
market for home PCs and Internet connectivity. Changes in, or the failure by us
to comply with, applicable domestic and international regulations could
materially adversely affect our business and operating results. In addition,
with respect to those countries that do not follow FCC regulations, we may need
to modify our products to meet local rules and regulations.
11
<PAGE> 14
Regulatory changes by the FCC or by regulatory agencies outside the United
States, including changes in the allocation or use of available frequency
spectrum, could significantly affect our operations by restricting our
development efforts, rendering current products obsolete or increasing the
opportunity for additional competition. In September 1993 and in February 1995,
the FCC allocated additional spectrum for personal communications services. In
January 1997, the FCC authorized 300 MHz of additional unlicensed frequencies in
the 5 GHz frequency range in Part 15 Subpart E which regulates U-NII devices
operating in the 5.15 - 5.35 GHz and 5.725 - 5.825 GHz frequency bands. In June
1999, the FCC issued a NPRM that proposed changing the way allocated frequencies
are utilized by Part 15 spread spectrum systems. These approved and proposed
changes in the allocation and use of available frequency spectrum could create
opportunities for other wireless networking products and services.
There can be no assurance that new regulations will not be promulgated,
that could materially and adversely affect our business and operating results.
THERE MAY BE POTENTIAL HEALTH AND SAFETY RISKS RELATED TO OUR PRODUCTS WHICH
COULD NEGATIVELY AFFECT OUR BUSINESS AND PRODUCT SALES.
The intentional emission of electromagnetic radiation has been the subject
of recent public concern regarding possible health and safety risks, and though
our products, when installed in any of the intended configurations, are designed
not to exceed the maximum permissible exposure limits listed in Section 1.1311
of the FCC Regulations, we can offer no assurance that safety issues will not
arise in the future and materially and adversely affect our business and
operating results.
TO COMPETE EFFECTIVELY, WE MUST ESTABLISH AND EXPAND NEW DISTRIBUTION CHANNELS
FOR OUR HOME NETWORKING PRODUCTS.
To date, a substantial percentage of our revenue has been derived from OEM
customers through our direct sales force. We sell our branded RangeLAN2 products
through domestic and international distributors. We are also establishing new
distribution channels for our Symphony family of cordless home and small office
networking products. Symphony products are currently sold through national
retailers such as Best Buy, CompUSA, OfficeMax, Office Depot and Staples
computer retailers such as Fry's Electronics, J&R Computer World, BrandSmart,
Comp-u-Tech, DataVision, Nationwide, leading computer catalogs such as CDW,
MobilePlanet and PC Connection, and numerous on-line retail sites over the
Internet, including our e-commerce Web site at www.proxim.com. In general,
distributors and retailers offer products of several different companies,
including products that may compete with our products. Accordingly, they may
give higher priority to products of other suppliers, thus reducing their efforts
to sell our products. Agreements with distributors and retailers are generally
terminable at their option. Any reduction in sales efforts or termination of a
relationship may materially and adversely affect our business and operating
results. Use of distributors and retailers also entails the risk that they will
build up inventories in anticipation of substantial growth in sales. If such
growth does not occur as anticipated, they may substantially decrease the amount
of product ordered in subsequent quarters. Such fluctuations could contribute to
significant variations in our future operating results.
IF WE LOSE KEY PERSONNEL OR WE ARE UNABLE TO HIRE ADDITIONAL QUALIFIED PERSONNEL
AS NECESSARY, WE MAY NOT BE ABLE TO EFFECTIVELY MANAGE OUR BUSINESS OR ACHIEVE
OUR OBJECTIVES.
We are highly dependent on the technical and management skills of our key
employees, in particular David C. King, Chairman, President and Chief Executive
Officer, and Juan Grau, Vice
12
<PAGE> 15
President of Engineering. We do not have employment agreements with or life
insurance on the life of, either person. In addition, given the rapid
technological change in this industry, we believe that the technical expertise
and creative skills of our engineers and other personnel are crucial in
determining our future success. The loss of the services of any key employee
could adversely affect our business and operating results. Our success also
depends in large part on a limited number of key marketing and sales employees
and on our ability to continue to attract, assimilate and retain additional
highly talented personnel. Competition for qualified personnel in the wireless
data communications and networking industries is intense, particularly in
Northern California where our headquarters are located. We can offer no
assurance that we will be successful in retaining our key employees or that we
can attract, assimilate or retain the additional skilled personnel as required.
OUR STOCK PRICE MAY BE EXTREMELY VOLATILE.
Recently, the price of our common stock has been volatile. We believe that
the price of our common stock may continue to fluctuate, perhaps substantially,
as a result of factors including:
- announcements of developments relating to our business;
- fluctuations in our operating results;
- general conditions in the wireless communications industry or the
worldwide economy;
- a shortfall in revenue or earnings from securities analysts' expectations
or other changes in financial estimates by securities analysts;
- announcements of technological innovations or new products or
enhancements by us or our competitors;
- developments in patent, copyright or other intellectual property rights;
and
- developments in our relationships with customers, distributors and
suppliers.
In the third quarter of 1997, we announced revenue and operating results
below expectations of securities analysts and investors, resulting in a decrease
in the market price of our common stock. In addition, in recent years the stock
market in general, and the market for shares of high technology stocks in
particular, have experienced extreme price fluctuations, which have often been
unrelated to the operating performance of affected companies. There can be no
assurance that the market price of our common stock will not experience
significant fluctuations in the future, including fluctuations that are
unrelated to our performance.
13
<PAGE> 16
USE OF PROCEEDS
Proxim will not receive any of the proceeds from the sale of the shares
offered by this prospectus. All proceeds from the sale of the shares offered
hereby will be for the account of the selling stockholder, as described below.
See "Selling Stockholder" and "Plan of Distribution."
SELLING STOCKHOLDER
The following table sets forth as of the date of this prospectus, the name
of the selling stockholder, the number of shares of Common Stock that the
selling stockholder owns, the number of shares of Common Stock owned by the
selling stockholder that may be offered for sale from time to time by this
prospectus, and the number of shares of Common Stock to be held by the selling
stockholder assuming the sale of all the Common Stock offered hereby.
The selling stockholder may also transfer shares owned by him by gift, and
upon any such transfer the donee would have the same right of sale as the
selling stockholder.
The shares being offered by the selling stockholder were acquired in
connection with our acquisition of Farallon Communications, Inc., a Delaware
corporation, in June 2000. We may amend or supplement this prospectus from time
to time to update the disclosure set forth herein.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY NUMBER SHARES BENEFICIALLY
OWNED PRIOR TO OF OWNED AFTER
OFFERING(1) SHARES OFFERING(1)
------------------- BEING --------------------
NAME OF SELLING STOCKHOLDER NUMBER PERCENT OFFERED NUMBER PERCENT
--------------------------- -------- -------- ------- -------- ---------
<S> <C> <C> <C> <C> <C>
Richard Maslana............................ 243,308 * 218,976 24,332 *
</TABLE>
-------------------------
* Less than 1%.
(1) Based on 26,219,986 shares outstanding as of September 30, 2000.
PLAN OF DISTRIBUTION
The shares covered by this prospectus may be offered and sold from time to
time by the selling stockholder. The selling stockholder will act independently
of Proxim in making decisions with respect to the timing, manner and size of
each sale. The selling stockholder may sell the shares being offered hereby on
the Nasdaq National Market, or otherwise, at prices and under terms then
prevailing or at prices related to the then current market price, at varying
prices or at negotiated prices. The shares offered hereby may be sold, without
limitation, by one or more of the following means of distribution: (a) a block
trade in which the broker-dealer so engaged will attempt to sell such shares as
agent, but may position and resell a portion of the block as principal to
facilitate the transaction; (b) purchases by a broker-dealer as principal and
resale by such broker-dealer for its own account pursuant to this prospectus;
(c) an over-the-counter distribution in accordance with the rules of the Nasdaq
National Market; (d) ordinary brokerage transactions and transactions in which
the broker solicits purchasers; and (e) in privately negotiated transactions. To
the extent required, this prospectus may be amended and supplemented from time
to time to describe a specific plan of distribution.
In connection with distributions of the shares offered hereby or otherwise,
the selling stockholder may enter into hedging transactions with broker-dealers
or other financial institutions. In connection with such transactions,
broker-dealers or other financial institutions may engage in short sales of
14
<PAGE> 17
Proxim's common stock in the course of hedging the positions they assume with
selling stockholder. The selling stockholder may also sell Proxim's common stock
short and deliver the shares offered hereby to close out such short positions.
The selling stockholder may also enter into option or other transactions with
broker-dealers or other financial institutions which require the delivery to
such broker-dealer or other financial institution of shares offered hereby,
which shares such broker-dealer or other financial institution may resell
pursuant to this prospectus (as supplemented or amended to reflect such
transaction). The selling stockholder may also pledge the shares offered hereby
to a broker-dealer or other financial institution, and, upon a default, such
broker-dealer or other financial institution, may effect sales of the pledged
shares pursuant to this prospectus (as supplemented or amended to reflect such
transaction). In addition, any shares offered hereby that qualify for sale
pursuant to Rule 144 may, at the option of the holder thereof, be sold under
Rule 144 rather than pursuant to this prospectus.
Any broker-dealer participating in such transactions as agent may receive
commissions from the selling stockholder and/or purchasers of the shares offered
hereby (and, if it acts as agent for the purchaser of such shares, from such
purchaser). Usual and customary brokerage fees will be paid by the selling
stockholder. Broker-dealers may agree with the selling stockholder to sell a
specified number of shares at a stipulated price per share, and, to the extent
such a broker-dealer is unable to do so acting as agent for the selling
stockholder, to purchase as principal any unsold shares at the price required to
fulfill the broker-dealer commitment to the selling stockholder. Broker-dealers
who acquire shares as principal may thereafter resell such shares from time to
time in transactions (which may involve cross and block transactions and which
may involve sales to and through other broker-dealers, including transactions of
the nature described above) in the over-the-counter market, in negotiated
transactions or otherwise at market prices prevailing at the time of sale or at
negotiated prices, and in connection with such resales, may pay to or receive
from the purchasers of such shares commissions computed as described above.
To comply with the securities laws of certain states, if applicable, the
shares offered hereby will be sold in such jurisdictions only through registered
or licensed brokers or dealers. In addition, in certain states the shares
offered hereby may not be sold unless they have been registered or qualified for
sale in the applicable state or an exemption from the registration or
qualification requirement is available and is complied with.
We have advised the selling stockholder that the anti-manipulation rules of
Regulation M under the Exchange Act may apply to sales of the shares offered
hereby in the market and to the activities of the selling stockholders and their
affiliates. In addition, we will make copies of this prospectus available to the
selling stockholder and have informed him of the need for delivery of copies of
this prospectus to purchasers at or prior to the time of any sale of the shares
offered hereby. The selling stockholder may indemnify any broker-dealer than
participates in transactions involving the sale of the shares against certain
liabilities, including liabilities arising under the Securities Act.
At the time a particular offer of shares is made, if required, a prospectus
supplement will be distributed that will set forth the number of shares being
offered and the terms of the offering, including the name of any underwriter,
dealer or agent, the purchase price paid by any underwriter, any discount,
commission and other item constituting compensation, any discount, commission or
concession allowed or reallowed or paid to any dealer, and the proposed selling
price to the public.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our Bylaws limit the liability of our directors and officers for expenses
to the maximum extent permitted by Delaware law. Delaware law provides that
directors of a corporation will not be
15
<PAGE> 18
personally liable for monetary damages for breach of their fiduciary duties as
directors, except for liability (i) for any breach of their duty of loyalty to
the corporation or its stockholders; (ii) for acts or omissions not in good
faith or that involve intentional misconduct or a knowing violation of law;
(iii) for unlawful payments of dividends or unlawful stock repurchases or
redemptions as provided in Section 174 of the Delaware General Corporation Law;
or (iv) for any transaction from which the director derived an improper personal
benefit.
Our Certificate of Incorporation provides that we must indemnify our
directors and may indemnify our other officers, employees and agents to the
fullest extent permitted by law.
We have entered into agreements to indemnify our directors and officers, in
addition to indemnification provided for in our Bylaws. These agreements, among
other things, indemnify our directors and officers for certain expenses
(including attorneys' fees), judgments, fines and settlement amounts incurred by
any such person in any action or proceeding, including any action by or in the
right of Proxim, arising out of such person's services as a Proxim director or
officer, any subsidiary of Proxim or any other company or enterprise to which
the person provides services at our request.
Proxim's Bylaws also permit us to secure insurance on behalf of any
officer, director, employee or other agent for any liability arising out of his
or her actions in such capacity, regardless of whether the Bylaws would permit
indemnification. We also maintain an insurance policy insuring our directors and
officers against liability for certain acts and omissions while acting in their
official capacities.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling Proxim
pursuant to the foregoing provisions, we have been informed 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.
LEGAL MATTERS
Certain legal matters relating to the validity of the securities offered
hereby will be passed upon for Proxim by Wilson Sonsini Goodrich & Rosati,
Professional Corporation ("WSGR"), Palo Alto, California. Certain members of
WSGR beneficially own approximately 3,700 shares of Proxim's Common Stock and
options to purchase an aggregate of approximately 50,000 shares of Proxim's
Common Stock.
EXPERTS
The financial statements incorporated in this Prospectus by reference to
the Annual Report on Form 10-K of Proxim, Inc. for the year ended December 31,
1999 have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
16
<PAGE> 19
------------------------------------------------------
------------------------------------------------------
PROSPECTIVE INVESTORS MAY RELY ONLY ON THE INFORMATION CONTAINED IN THIS
PROSPECTUS. NEITHER PROXIM NOR ANY SELLING STOCKHOLDER HAS AUTHORIZED ANYONE TO
PROVIDE PROSPECTIVE INVESTORS WITH INFORMATION DIFFERENT FROM THAT CONTAINED IN
THIS PROSPECTUS. THIS PROSPECTUS IS NOT AN OFFER TO SELL NOR IS IT SEEKING AN
OFFER TO BUY THE SHARES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT
PERMITTED. THE INFORMATION CONTAINED IN THIS PROSPECTUS IS CORRECT ONLY AS OF
THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE TIME OF THE DELIVERY OF THIS
PROSPECTUS OR ANY SALE OF THE SHARES.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
WHERE YOU CAN
FIND MORE INFORMATION............. 1
PROXIM.............................. 2
FORWARD-LOOKING STATEMENTS.......... 2
RISK FACTORS........................ 3
USE OF PROCEEDS..................... 14
SELLING STOCKHOLDER................. 14
PLAN OF DISTRIBUTION................ 14
INDEMNIFICATION OF DIRECTORS AND
OFFICERS.......................... 15
LEGAL MATTERS....................... 16
EXPERTS............................. 16
</TABLE>
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
218,976 Shares
PROXIM, INC.
Common Stock
-------------------------
PROSPECTUS
-------------------------
November , 2000
------------------------------------------------------
------------------------------------------------------
<PAGE> 20
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The Company will pay all expenses incident to the offering and sale to the
public of the shares being registered other than any commissions and discounts
of underwriters, dealers or agents and any transfer taxes. Such expenses are set
forth in the following table. All of the amounts shown are estimates except for
the Securities and Exchange Commission ("SEC") registration fee and the Nasdaq
Stock Market listing fee.
<TABLE>
<S> <C>
SEC Registration Fee........................................ $ 3,166
Accounting fees and expenses................................ 5,000
Legal fees and expenses..................................... 10,000
Nasdaq Stock Market listing fee............................. 2,190
Miscellaneous............................................... 5,000
-------
Total............................................. $25,356
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our Bylaws limit the liability of our directors and officers for expenses
to the maximum extent permitted by Delaware law. Delaware law provides that
directors of a corporation will not be personally liable for monetary damages
for breach of their fiduciary duties as directors, except for liability (i) for
any breach of their duty of loyalty to the corporation or its stockholders; (ii)
for acts or omissions not in good faith or that involve intentional misconduct
or a knowing violation of law; (iii) for unlawful payments of dividends or
unlawful stock repurchases or redemptions as provided in Section 174 of the
Delaware General Corporation Law; or (iv) for any transaction from which the
director derived an improper personal benefit.
Our Certificate of Incorporation provides that we must indemnify our
directors and may indemnify our other officers, employees and agents to the
fullest extent permitted by law.
We have entered into agreements to indemnify our directors and officers, in
addition to indemnification provided for in our Bylaws. These agreements, among
other things, indemnify our directors and officers for certain expenses
(including attorneys' fees), judgments, fines and settlement amounts incurred by
any such person in any action or proceeding, including any action by or in the
right of Proxim, arising out of such person's services as a Proxim director or
officer, any subsidiary of Proxim or any other company or enterprise to which
the person provides services at our request.
Proxim's Bylaws also permit us to secure insurance on behalf of any
officer, director, employee or other agent for any liability arising out of his
or her actions in such capacity, regardless of whether the Bylaws would permit
indemnification. We also maintain an insurance policy insuring our directors and
officers against liability for certain acts and omissions while acting in their
official capacities.
II-1
<PAGE> 21
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER
-------
<C> <S>
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, Professional
Corporation
23.1 Consent of Wilson Sonsini Goodrich & Rosati, Professional
Corporation (included in Exhibit 5.1)
23.2 Consent of PricewaterhouseCoopers LLP, independent
accountants
24.1 Power of Attorney (contained on Page II-4)
</TABLE>
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;
(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) (Section 230.424(b) of this chapter) if, 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; 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 (i) and (ii) 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 (i)
and (ii) 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
Exchange Act that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities 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.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
B. Undertaking Regarding Filings Incorporating Subsequent Exchange Act
Documents by Reference.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to 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
II-2
<PAGE> 22
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.
C. Undertaking Regarding Indemnification.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described in Item 15 above, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
D. Undertaking Regarding Registration Statement Permitted by Rule 430A.
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purpose of determining liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-3
<PAGE> 23
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable cause 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 Sunnyvale, State of California, on November 17, 2000.
PROXIM, INC.
By: /s/ KEITH E. GLOVER
------------------------------------
Keith E. Glover
Vice President of Finance and
Administration and Chief Financial
Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Keith E. Glover his attorney-in-fact,
with the power of substitution, for him in any and all capacities, to sign any
amendment to this Registration Statement on Form S-3, and to file the same, with
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting to said attorney-in-fact full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in connection therewith, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorney-in-fact, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons on behalf
of the Registrant on November 17, 2000.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DAVID C. KING President and Chief Executive Officer
----------------------------------------------------- (Principal Executive Officer), Chairman of
David C. King the Board of Directors
Director
-----------------------------------------------------
Raymond Chin
/s/ LESLIE G. DENEND Director
-----------------------------------------------------
Leslie G. Denend
Director
-----------------------------------------------------
Gregory L. Reyes
/s/ JEFFREY D. SAPER Director
-----------------------------------------------------
Jeffrey D. Saper
</TABLE>
II-4
<PAGE> 24
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER
-------
<C> <S>
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, Professional
Corporation
23.1 Consent of Wilson Sonsini Goodrich & Rosati, Professional
Corporation (included in Exhibit 5.1)
23.2 Consent of PricewaterhouseCoopers LLP, independent
accountants
24.1 Power of Attorney (contained on Page II-4)
</TABLE>
