TELULAR CORP
S-3/A, 1997-06-13
TELEPHONE & TELEGRAPH APPARATUS
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<PAGE>   1
   
 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 13, 1997

                                                   Registration No. 333-12705
    
================================================================================

                     SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C. 20549
   
                              AMENDMENT NO.1 ON
      
                                   FORM S-3
                           REGISTRATION STATEMENT
                                    UNDER
                         THE SECURITIES ACT OF 1933
                         --------------------------
                             TELULAR CORPORATION
           (Exact name of Registrant as specified in its charter)
                -----------------------------------------------
            DELAWARE                                  36-3885440
 (State or other jurisdiction of                   (I.R.S. Employer
  incorporation or organization)                 Identification Number)
                           --------------------------
   
                           647 N. LAKEVIEW PARKWAY
                            VERNON HILLS, IL 60061
    
        (Address, including zip code, and telephone number, including
           area code, of Registrant's principal executive offices)
                       ----------------------------------
                             KENNETH E. MILLARD
                           CHIEF EXECUTIVE OFFICER
                             TELULAR CORPORATION
   
                           647 N. LAKEVIEW PARKWAY
                            VERNON HILLS, IL 60061
                                (847) 247-9400
    
          (Name, address, including zip code, and telephone number,
                 including area code, of agent for service)
                        --------------------------------
                                  COPY TO:
                           MICHAEL E. CUTLER, ESQ.
                             COVINGTON & BURLING
                       1201 PENNSYLVANIA AVENUE, N.W.
                           WASHINGTON, D.C. 20004
                               (202) 662-6000
                              --------------------

        Approximate date of commencement of proposed sale to public:
   From time to time after this Registration Statement becomes effective.

                       ----------------------------------
         If the only securities being registered on this Form are to be 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, 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 offer.  [ ]

         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 on 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>
<CAPTION>
===================================================================================================================================
                                                              PROPOSED MAXIMUM          PROPOSED MAXIMUM          AMOUNT OF
          TITLE OF SECURITIES             AMOUNT TO BE         OFFERING PRICE              AGGREGATE            REGISTRATION
            TO BE REGISTERED               REGISTERED)          PER SHARE(1)           OFFERING PRICE(1)             FEE(2)
- -----------------------------------------------------------------------------------------------------------------------------------
 <S>                                         <C>                   <C>                   <C>                      <C>
 COMMON STOCK, PAR VALUE $.01
 PER SHARE . . . . . . . . . .               425,000             $4.25                  $1,806,250               $96.50  
===================================================================================================================================
</TABLE>
    



   
(1)      Estimated solely for the purpose of calculating the registration fee
         pursuant to Rule 457(c) based on the average of the high and low sale
         prices of the shares of Common Stock as reported on the Nasdaq
         National Market System on June 11, 1997. 
    

   
(2)      A registration fee of $1,000 for 350,000 of the shares registered
         hereby was paid in connection with the initial filing of the 
         registration statement on September 25, 1996.  The registration fee 
         noted above relates only to the registration of an additional 75,000 
         shares.
    

<PAGE>   2



                 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 SECURITIES AND EXCHANGE COMMISSION
(THE "COMMISSION"), ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.

                 INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR
AMENDMENT.  A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN
FILED WITH THE 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                                                 SUBJECT TO COMPLETION
                                                                JUNE 13, 1997
    

                             TELULAR CORPORATION
                                 COMMON STOCK
                          (par value $.01 per share)

   
                 This Prospectus relates to the resale of up to 425,000 shares
of common stock, par value $.01 per share (the "Common Stock"), of Telular
Corporation, a Delaware corporation (the "Company") issued or issuable to
Wireless Domain, Inc., a New York Corporation ("Selling Shareholder" or 
"Wireless Domain") in connection with the transaction described herein.  All 
of the shares offered hereby will be offered and sold by the Selling 
Shareholder.  Although the Company is a shareholder of the Selling Shareholder
and may benefit from such sales, the Company will not receive any proceeds 
from the sale of the shares of Common Stock offered hereby.  See "Selling 
Shareholder."
    

   
                 The Common Stock is listed on the Nasdaq National Market under
the symbol WRLS.  On June 11, 1997, the last sale price of the Common
Stock, as reported on the Nasdaq National Market, was $4.125 per share.
    

                 The Common Stock may be offered from time to time by the
Selling Shareholder to or through brokers, dealers or other agents or directly
to other purchasers in one or more market transactions, in one or more private
transactions or in a combination of such methods of sale, at prices then
prevailing, at prices related to such prices, or at negotiated prices.  In
effecting sales, brokers, dealers or other agents engaged by the Selling
Shareholder may arrange for other brokers, dealers or agents to participate.
Such brokers, dealers or agents may receive commissions, discounts or
concessions from the Selling Shareholder in amounts to be negotiated.  Such
brokers or dealers and any other participating brokers or dealers may be deemed
to be "underwriters" within the meaning of the Securities Act of 1933, as
amended (the "Securities Act"), and any such commissions, discounts or
concessions may be deemed to be underwriting discounts or commissions under the
Securities Act.

                 Certain costs, expenses and fees in connection with the
registration of the Common Stock will be borne by the Company.  Commissions,
discounts and transfer taxes, if any, attributable to the sales of the Common
Stock will be borne by the Selling Shareholder.


         INVESTMENT IN THE SECURITIES OFFERED HEREBY INVOLVES A HIGH
                DEGREE OF RISK.  SEE "RISK FACTORS" ON PAGE 3


        THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
          SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
          COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
              OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
                ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY
                     REPRESENTATION TO THE CONTRARY IS A
                              CRIMINAL OFFENSE.


   
                     THE DATE OF THIS PROSPECTUS IS JUNE  , 1997 
    





<PAGE>   3


NO DEALER, SALESMAN OR OTHER PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO
MAKE ANY REPRESENTATIONS NOT 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, THE SELLING SHAREHOLDER OR ANY UNDERWRITER.  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 WOULD BE UNLAWFUL.  THE DELIVERY OF THIS PROSPECTUS AT
ANY TIME DOES NOT IMPLY THAT THIS INFORMATION CONTAINED HEREIN IS CORRECT AS OF
ANY TIME SUBSEQUENT TO ITS DATE.

                             AVAILABLE INFORMATION

                 THE COMPANY IS SUBJECT TO THE INFORMATIONAL REQUIREMENTS OF
THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT"), AND IN
ACCORDANCE THEREWITH FILES REPORTS, PROXY STATEMENTS AND OTHER INFORMATION WITH
THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").  SUCH REPORTS, PROXY
STATEMENTS 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 THE PUBLIC REFERENCE
FACILITIES LOCATED AT THE REGIONAL OFFICES OF THE COMMISSION AT THE FOLLOWING
ADDRESSES:  NEW YORK REGIONAL OFFICE, 7 WORLD TRADE CENTER, SUITE 1300, NEW
YORK, NEW YORK 10048 AND CHICAGO REGIONAL OFFICE, CITICORP CENTER, 500 WEST
MADISON STREET, CHICAGO, ILLINOIS  60661-2511.  COPIES OF SUCH MATERIAL ALSO
CAN BE OBTAINED FROM THE PUBLIC REFERENCE SECTION OF THE COMMISSION AT 450
FIFTH STREET, N.W., WASHINGTON, D.C.  20549, AT PRESCRIBED RATES.

                 THIS PROSPECTUS CONSTITUTES A PART OF A REGISTRATION STATEMENT
ON FORM S-3 FILED BY THE COMPANY WITH THE COMMISSION UNDER THE SECURITIES ACT
WITH RESPECT TO THE COMMON STOCK BEING OFFERED BY THIS PROSPECTUS.  THIS
PROSPECTUS DOES NOT CONTAIN ALL OF THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENT, CERTAIN PORTIONS OF WHICH HAVE BEEN OMITTED AS
PERMITTED BY THE RULES AND REGULATIONS OF THE COMMISSION.  FOR FURTHER
INFORMATION, REFERENCE IS MADE TO THE REGISTRATION STATEMENT, AND TO THE
EXHIBITS INCORPORATED THEREIN BY REFERENCE OR FILED AS A PART THEREOF.  ANY
STATEMENTS CONTAINED HEREIN CONCERNING THE PROVISIONS OF ANY SUCH EXHIBITS ARE
NOT NECESSARILY COMPLETE AND, IN EACH INSTANCE, REFERENCE IS MADE TO THE COPY
OF SUCH EXHIBIT FILED AS AN EXHIBIT TO THE REGISTRATION STATEMENT OR OTHERWISE
FILED WITH THE COMMISSION.  EACH SUCH STATEMENT IS QUALIFIED IN ITS ENTIRETY BY
SUCH REFERENCE.


               INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

                 THE FOLLOWING DOCUMENTS FILED BY THE COMPANY WITH THE
COMMISSION ARE HEREBY INCORPORATED BY REFERENCE IN THIS PROSPECTUS:

   
                 (A)      THE ANNUAL REPORT OF THE COMPANY ON FORM 10-K FOR THE
                          FISCAL YEAR ENDED SEPTEMBER 30, 1996.
    

   
                 (B)      THE QUARTERLY REPORTS OF THE COMPANY ON FORM 10-Q FOR
                          THE QUARTERS ENDED DECEMBER 31, 1996 AND MARCH 31, 
                          1997.
    

   
                 (C)      THE CURRENT REPORT OF THE COMPANY ON FORM 8-K FILED
                          APRIL 25, 1997.
    

   
                 (D)      THE DESCRIPTION OF THE COMPANY'S COMMON STOCK
                          CONTAINED IN THE COMPANY'S REGISTRATION STATEMENT ON
                          FORM 8-A, DATED JANUARY 13, 1994, FILED PURSUANT TO
                          SECTION 12 OF THE EXCHANGE ACT, WHICH INCORPORATES BY
                          REFERENCE THE DESCRIPTION CONTAINED IN THE COMPANY'S
                          REGISTRATION STATEMENT ON FORM S-1 UNDER THE
                          SECURITIES ACT, NO. 33-72096, AS AMENDED, AND IN ANY
                          AMENDMENTS OR REPORTS THAT ARE FILED FOR THE PURPOSE
                          OF UPDATING SUCH DESCRIPTION.
    

                 ALL DOCUMENTS FILED BY THE COMPANY PURSUANT TO SECTION 13(a),
13(c), 14 OR 15(d) OF THE EXCHANGE ACT, SUBSEQUENT TO THE DATE OF THIS
PROSPECTUS AND PRIOR TO THE TERMINATION OF THE OFFERINGS TO WHICH THIS
PROSPECTUS RELATES SHALL BE DEEMED TO BE INCORPORATED BY REFERENCE IN THIS
PROSPECTUS AND TO BE A PART HEREOF FROM THE DATE OF FILING OF SUCH DOCUMENTS.
ANY STATEMENT IN A DOCUMENT INCORPORATED OR DEEMED TO BE INCORPORATED BY
REFERENCE HEREIN SHALL BE DEEMED TO BE MODIFIED OR SUPERSEDED BY THIS
PROSPECTUS TO THE EXTENT THAT A STATEMENT CONTAINED HEREIN OR IN ANY OTHER
SUBSEQUENTLY FILED DOCUMENT WHICH ALSO IS OR IS 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 HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE COPIES
OF ALL DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN EXHIBITS TO SUCH
DOCUMENTS UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY REFERENCE IN
SUCH DOCUMENTS)  TO EACH PERSON, INCLUDING ANY BENEFICIAL OWNER, TO WHOM A COPY
OF THIS PROSPECTUS HAS BEEN DELIVERED ON THE WRITTEN OR ORAL REQUEST OF SUCH
PERSON TO:

   
                   THOMAS M. MASON CHIEF FINANCIAL OFFICER
                             TELULAR CORPORATION
                            647 N. LAKEVIEW PARKWAY
                            VERNON HILLS, IL 60061
                                 (847) 247-9400 
    


<PAGE>   4


                                 RISK FACTORS


                 Prospective purchasers of Common Stock of the Company should
carefully consider the following factors in conjunction with the information
contained in the materials in the Company's reports on Forms 10-K, 10-Q and 8-K
and proxy materials, as filed with the Commission (the "SEC Filings").


LIMITED OPERATING HISTORY AND EXPECTATION OF CONTINUED LOSSES

   
                 The Company commenced operations in 1986 and although it
reported a profit for the fourth quarter of fiscal year 1996, and
the first quarter of fiscal year 1997, it has yet to report an annual profit.
The development of the Company's business has required significant
expenditures in connection with the defense of the Company's patents, research
and development of its technology and marketing of its products.  Substantial
costs related to these activities have been and will continue to be incurred by
the Company before the realization of associated revenues.  
    


FUTURE CAPITAL NEEDS; UNCERTAINTY OF ADDITIONAL FUNDING

   
                 At March 31, 1997, the Company had $11.8 million in cash and
cash equivalents with a working capital surplus of approximately $25.7 million.
Expansion of the Company's business, including the development of new products
and markets for the Company's existing products, will require significant
product development expenditures.  In addition, the Company is expected at
least in the near term to continue to operate at a loss.  Based on its current
operating plan, the Company believes its existing capital resources, including
a credit facility and proceeds from the issuance of the Company's Series A
Convertible Preferred Stock ("Preferred Stock"), should enable it to maintain
its current and planned operations.  The Company continues to consider other
financing opportunities that would be used to support additional growth and 
product development. Expected future uses of cash include working capital 
requirements, marketing programs and product development in anticipation of 
future revenues.  Cash requirements may vary and are difficult to predict 
given the nature of the developing markets targeted by the Company. The amount 
of royalty income from the Company's licensees is unpredictable, but could 
have an impact on the Company's actual cash flow.  Unanticipated events
such as litigation could increase capital requirements.  To the extent that
additional funds are needed subsequently, the Company may need to raise
additional funds through public or private financings.  No assurance can be
given that additional financing will be available or that, if available, it
will be obtained on terms favorable to the Company.
    

   
                 The Company has now completed a major corporate restructuring
as part of a program to balance expenditure levels with revenues, and to
improve working capital.  In connection with that restructuring, the Company
incurred approximately $11.0 million in restructuring and impairment charges,
phased out its manufacturing operations in Puerto Rico and Illinois,
consolidated its manufacturing operations at the Company's Atlanta, Georgia
facility, and reduced its workforce from approximately 250 employees in January
1996 to approximately 110 employees at the end of November 1996. Details of the
restructuring are set forth in the Company's SEC Filings.  The Company is
continuing to monitor expenditure levels in light of timing of market expansion
and revenues and anticipates taking further actions from time to time as it
deems appropriate.
    

   
                 Faced with terminating leases at its Buffalo Grove and
Atlanta, Georgia facilities, on May 1, 1997, the Company consolidated its
Buffalo Grove and Atlanta, Georgia operations into a new facility in Vernon
Hills, Illinois. This has resulted in the Company's manufacturing, engineering,
and administration operations to be located at a single site.  The Company
anticipates this development will enhance the quality of its products and speed
the reach of such products to market.

    


MANAGEMENT TRANSITION

   
                 The Company has experienced several significant changes in
management over the past two years.  Richard Gerstner served as Chief
Executive Officer from November 1993 to November 1995.  From November 1995
until April 1996, William L. De Nicolo served as Chief Executive Officer.  Mr.
De Nicolo, the founder of the Company, served as CEO prior to Mr. Gerstner's
appointment and has served as Chairman of the Board since the Company was
founded.  Kenneth E. Millard became President and Chief Executive Officer in
April 1996.  Mr. Millard also serves as a member of the Board of Directors. 
Robert L. Montgomery was appointed Executive Vice-President and Chief Operating
Officer during March, 1997.  Thomas M. Mason joined the Company as Senior
Vice-President and Chief Financial Officer in March, 1997. Mr. Mason replaced
Frank J.M. ten Brink who had performed those functions since joining the
Company in July, 1996.  The Company plans to hire additional senior executives
for other functions during fiscal year 1997.
    

   
                 As noted above, the Company has experienced a number of other
changes in its executives over the past year and has substantially reduced its
workforce.  These changes may have an adverse effect on the Company's ability
to implement its plans and manage its operations in a consistent manner.
    




<PAGE>   5

RELATIONSHIP WITH MOTOROLA

                 The Company has several important relationships with Motorola,
Inc. ("Motorola"), which owns approximately 15% of the Company's outstanding
shares of Common Stock.

   
                 Sales by the Company to Motorola represented approximately 31%
of net sales by the Company during the preceding fiscal year.  In addition, as
discussed below under "Reliance on Key Customer," the Company has entered into
a substantial contract with Motorola to sell fixed wireless terminals to
Motorola for its construction of a cellular system in Hungary. 
    


   
                 The Company purchases cellular transceivers from Motorola. 
These purchases represented approximately 54% of total cost of goods for the
Company during the preceding fiscal year.
    

                 The Company and Motorola have recently expanded their
purchase/supply relationship into a cross-OEM arrangement under which the
Company will sell additional fixed wireless terminals to Motorola and Motorola
will sell current and future cellular products to the Company.

                 The Company and Motorola have entered into cross-licensing
relationships under their respective intellectual property rights.

                 These and other aspects of the Company and Motorola's
relationship are discussed in more detail in the SEC Filings.

   
RELIANCE ON KEY CUSTOMER
    

   
                  In the near term the Company's success may depend on a number
of large orders from a small group of companies, which creates a risk that the
loss of any one customer may have a significant impact on the Company's
financial results. During fiscal year 1996, sales by the Company to Motorola
represented approximately 31% of total sales. The Company has a substantial
contract with Motorola to sell fixed wireless terminals to Motorola for its
construction of a cellular system in Hungary, and is negotiating for additional
business with Motorola for subsequent phases of the Hungarian project.  The
contract includes a commitment by Motorola to purchase $100 million of the
Company's fixed wireless terminals over a three-year period commencing January
1, 1996.  As of May 23, 1997, Motorola had purchased $23.5 million of product
under this contract.  The commitment by Motorola to purchase the Company's
product over a three-year period is not guaranteed.
    


INTELLECTUAL PROPERTY RIGHTS

   
                 The Company's success in the United States will depend to a
considerable extent upon its ability to obtain and enforce intellectual
property protection for its technology in the United States.  No assurance can
be given that the Company's existing patents or any future patents obtained by
the Company will not be challenged, invalidated or circumvented, or that the
Company's competitors will not independently develop or patent technologies
that are substantially equivalent to or superior to the Company's technology.
The nature and status of litigation that involves the Company's intellectual
property rights is set forth in the SEC Filings.
    

                 Although the Company believes that its intelligent interface
can be adapted to accommodate emerging wireless services, there can be no
assurance that these new services will fall within the boundaries of the
Company's existing patent protection.

   
                 In some countries, patent protection is not available.
Moreover, some countries that grant patents do not afford meaningful protection
or redress for violations.  Neither the Company nor its competitors have
established, and both are now legally barred from establishing, patent
protection for core technology in many other countries, including the principal
countries of Western Europe.  In the absence of patent protection, the Company
has relied upon other competitive factors including:  (a) product
functionality, (b) the quality of its products and (c) the desirability of
using products that meet the same specifications as those in the United States
and in other countries where the Company has obtained patent protection.
    

                 There can be no assurance that patent protection can be
obtained, in the United States or elsewhere, for new products or applications,
or that such patent protection, if obtained, will afford meaningful protection.


INTENSE COMPETITION IN INDUSTRY

                 Competition in the wireless telecommunications equipment
industry is intense.  The industry includes major domestic and international
companies, many of which have substantially greater financial, technical,
marketing, sales, manufacturing, distribution and other resources than those of
the Company.  The Company faces competition in various areas from certain of
its licensees and those customers who may purchase the licensees' products.  It
has granted a non-exclusive royalty-bearing license to Motorola which enables
Motorola to produce and sell products which compete with the Company's
products.



<PAGE>   6

                 To the extent that expansion of the Company's product line or
the development of new uses or applications for its products are outside of the
protection provided by the Company's patents and other intellectual property
rights, the Company may encounter increased competition from a variety of
sources.


RELIANCE UPON GROWTH AND PRICING OF WIRELESS SERVICE

                 The market for basic telephone service in developing
countries, which at present are the Company's principal markets, is an emerging
one.  The timing related to purchases of equipment for the provision of
telephone service is affected by regulatory, macroeconomic, capital
availability and competitive factors which make the timing of such awards
difficult to predict.

                 The success of the Company depends to a considerable extent
upon the continued growth and increased availability of cellular and other
wireless telecommunications services  internationally and, to a lesser extent
at least in the short term, in the United States.


ANTI-TAKEOVER PROVISIONS; MOTOROLA PURCHASE RIGHTS

   
                 The Company's Board of Directors can, without obtaining
stockholder approval, issue shares of preferred stock having rights that could
adversely affect the voting power of holders of the Common Stock.  The issuance
of preferred stock may delay, defer or prevent a change in control of the
Company.  In addition, Section 203 of the Delaware General Corporation Law
restricts certain business combinations with any "interested stockholder" as
defined in such law.  The current stockholders of the Company are not, by
virtue of their current holdings, deemed to be "interested stockholders" under
this statute.  This statute may delay, deter or prevent a change in control of
the Company.
    

   
                 Under the terms and conditions of the Company's Preferred
Stock the merger, consolidation, or sale of substantially all of the assets of
the Company, or the purchase of more than 50% of the outstanding shares of
Common Stock of the Company, prior to conversion of all of the shares of the
Preferred Stock may trigger a right of redemption on the part of the holders of
the Preferred Stock.
    

   
                 Under the Shareholders' Agreement among certain of the
Company's stockholders, the Company and its principal stockholders are required
to notify Motorola prior to any solicitation of purchase offers for, or the
acceptance of any unsolicited offer for, all or substantially all of the assets
of the Company or a majority of its voting stock.  Motorola has the right to
submit a bid at that time, and the Company and its principal stockholders have
agreed not to make any such sale at a valuation lower than that of Motorola's
bid, if any.  Motorola's rights will terminate upon any sale by Motorola of
shares of Common Stock, unless after such sale Motorola owns 20% or more of the
outstanding Common Stock, on a fully diluted basis.  The existence of this
contractual provision may delay, deter or prevent a change in control of the
Company.
    

   
REDEMPTION OF PREFERRED STOCK
    

   
                 A right of redemption on the part of the holders of the
Company's Preferred Stock may be triggered by a number of events, in addition
to the merger, consolidation or sale of substantially all of the assets of the
Company, the purchase of more than 50% of the outstanding shares of Common
Stock of the Company, including the failure by the Company to convert Preferred
Stock when required to do so, the delisting of the Company's Common Stock from
a national securities exchange, or the failure by the Company to timely
register and keep in effect the Common Stock to be issued upon conversion of
the Preferred Stock.
    

VOLATILITY OF QUARTERLY OPERATING RESULTS

                 The Company's quarterly operating results may fluctuate based
on a number of factors, including variations in the Company's distribution
channels and the mix of products it sells, the timing of final product
approvals from any major distributor or end user, the timing of orders from and
shipments to major customers, the timing of new product introductions by the
Company or its competitors, changes in pricing policies by the Company's
suppliers, the availability and cost of key components, the timing of personnel
hirings and the market acceptance of new and enhanced versions of the Company's
products.


VOLATILITY OF STOCK PRICE

                 Factors such as announcements of the results of trials or the
introduction of new products by the Company or its competitors, market
conditions in the telecommunications, technology and emerging growth sectors
and rumors relating to the Company or its competitors may have a significant
impact on the market price of the Common Stock.  Furthermore, the stock market
has experienced volatility that has particularly affected the market prices of
equity securities of many high technology and emerging growth companies such as
those in the telecommunications industry.  This volatility has often been
unrelated to the operating performance of such companies.  These market
fluctuations could adversely affect the price of the Common Stock.

   
                 The Company's stock price was particularly volatile during
fiscal year 1996.  The Company believes that this volatility was attributable
in part to the timing on conversion of the $18 million in convertible
debentures issued by the Company in December 1995.  All of the debentures 
have been converted, and
    





<PAGE>   7

   
a total of 7.0 million shares of Common Stock have been issued.  
    

   
                 The Preferred Stock issued by the Company is convertible into
Common Stock at a price equal to the lower of the 110% of the 30-day average
trading price prior to the time the Common Stock was issued and 85% (subject to
certain adjustments) of the 30-day average trading price prior to conversion,
subject to certain minimum price provisions.  Under the terms of the purchase
agreement for the Preferred Stock, the holders thereof have covenanted not to
engage in short sales (other than short sales no more than three days prior to
conversion in an amount which does not exceed the number of shares to be
received upon such conversion) or to engage in transactions in violation of
Section 9 of the 1934 Act, relating to the manipulation of the trading price of
the Common Stock.  While these limitations are intended to minimize volatility
that may result from the conversion of the Preferred Stock, there can be no
assurance that such volatility will not occur.
    

   
DILUTION
    

   
                 Upon conversion of the Company's Preferred Stock, Common Stock
may be issued at a discount relative to the market price of Common Stock at
that time.  Issuance at a discount could result in a dilution in the net
tangible book value of the Company per share and in the stockholders' equity
per share.  The magnitude of any dilution will depend on the size of the
discount and the number of shares to be issued.  These variables will depend on
a variety of factors, including the timing of conversion and the market price
at the time of conversion.
    


RAPID TECHNOLOGICAL CHANGE

                 The telecommunications equipment industry is characterized by
rapid technological advances, evolving industry standards, changes in end-user
requirements and frequent new product introduction and enhancements.  The
wireless telecommunications industry is experiencing significant technological
change, such as the proposed transformation of cellular systems from analog to
digital.  The rate at which this change occurs and the success of such new
technologies may have a material effect on the rate at which the Company
expands its business and on its ability to achieve profitability.  Moreover,
there can be no assurance that continuing developments in technology will not
result in the establishment of wireless or wireline technologies for which the
Company's interface technology is not required or in the development of
equipment equal or superior to that provided by the Company.


RISK OF LITIGATION

                 Litigation in the telecommunications equipment and other high
technology industries has increasingly been used as a competitive tactic both
by established companies seeking to protect their existing position in the
market and by emerging companies attempting to gain access to the market.  In
such litigation, complaints may be filed on a variety of grounds, including
antitrust, breach of contract, trade secret, patent or copyright infringement,
patent or copyright invalidity, and unfair business practices.  If the Company
is forced to defend itself against such claims, whether or not meritorious, the
Company is likely to incur substantial expense and diversion of management
attention, and may encounter market confusion and the reluctance of licensees
and distributors to commit resources to the Company's products.  In the event
that the Company's patents or other intellectual property rights were deemed
invalid or were determined not to prohibit competing technologies, the Company
could face additional competition.  See "Risk Factors -- Intellectual Property
Rights."


DEPENDENCE ON ABILITY TO DEVELOP MARKETS 

                 The Company's success depends on its ability to develop both
domestic and international markets for its products.  There can be no
assurances that the Company will continue to market its products successfully
or that a larger market for its products will continue to develop.


DEPENDENCE ON ABILITY TO MANAGE GROWTH

                 The Company's ability to produce and market large volumes of
competitively priced quality products depends on its ability to implement and
continually expand its operational and financial systems, recruit additional
employees and train, manage and motivate both current and new employees.
Failure to effectively manage the growth of the Company or the transition in
officers of the Company would have a material adverse effect on the business of
the Company.


   
DEPENDENCE ON CONTRACTORS FOR MANUFACTURING AND DISTRIBUTION
    

                 The Company uses subcontractors for the manufacture of certain
of its components and for the assembly of some of its products.  In the past,
the Company has experienced delays in the receipt of interface components and
products, which have resulted in delays in product deliveries.  The Company may
experience similar delays in the future.

   
                 The inability to obtain sufficient quantities of key
components as required, or to develop alternative sources if and as required in
the future, could result in delays or reductions in product shipments.  In
addition, shortages of raw materials or production capacity constraints at the
Company or its subcontractors could negatively affect the Company's ability to
meet its production obligations and result in increased prices for affected
parts.  These events could have a material adverse effect on the Company's
customer relationships and operating results.
    

   
                 The Company uses third parties, in addition to its direct
sales force, to distribute and market some of its products.  In particular, the
Company plans to use interconnect companies and cellular carriers to market,
distribute, install and service certain of its products.  Although the Company
has entered into contracts with several major interconnect companies and
cellular carriers, the Company is only in the early stages of developing these
relationships.  In addition, these third parties are not contractually
obligated to perform any of the activities on which the Company depends to meet
its business objectives.
    


DEPENDENCE ON MOTOROLA FOR TRANSCEIVERS

                 The Company currently procures most of its cellular
transceivers from Motorola, a principal stockholder of the Company.  Pursuant
to the stock purchase agreement between Motorola and the Company, Motorola has
agreed to provide the Company with an opportunity to purchase transceivers
based on any transmission technology that Motorola's Cellular Subscriber Group
offers, when, as and if such products are made available to



<PAGE>   8
the public.  Under this agreement, Motorola has a right of first refusal to
supply on competitive terms the Company's transceiver needs provided, among
other things, that Motorola manufactures a comparable product and that the
customer does not specifically request another manufacturer's transceiver
product.  If sufficient quantities of Motorola transceivers were not available,
the Company might have to redesign its products and could experience increased
costs and shipment delays.

   
    

QUALITY CONTROL PROBLEMS

                 From time to time, the Company has experienced quality control
problems with components provided by certain of its subcontractors.  The
Company has instituted quality monitoring procedures for its components to
address these problems and to comply with ISO- 9001.  However, there can be no
assurance that future quality control problems will not occur.


RISKS OF DOING BUSINESS IN DEVELOPING MARKETS

                 Among the Company's largest potential markets are developing
countries that may deploy wireless communications networks as an alternative to
the construction of wireline infrastructure.  Such countries may decline to
construct wireless telecommunications systems or construction of such systems
may be delayed for a variety of reasons, in which event the development of
demand for the Company's products in those countries will be similarly limited
or delayed.  In doing business in developing markets, the Company may also face
economic, political and hard currency conditions that are more volatile than
those commonly experienced in the United States and other areas.

   
                 Despite its reliance on international markets, to date, the
Company's sales have not been adversely affected by currency fluctuations.
Currently, the Company requires letters of credit or qualification for export
credit insurance underwritten by the Export-Import Bank of the United States or
other third party insurers on a substantial portion of its international sales
orders.  Also, to mitigate the effects of currency fluctuations on the
Company's results of operations, the Company endeavors to conduct all of its
international transactions in U.S. dollars.  However, as the Company's
international operations grow, foreign exchange or the inflation of a foreign
currency may pose greater risks for the Company, and the Company may be
required to develop and implement additional strategies to manage these risks.
    


DEPENDENCE ON RESEARCH AND DEVELOPMENT

                 The telecommunications equipment market is characterized by
rapid technological advance and the development of increasingly sophisticated
and powerful systems.  To remain competitive, the Company must dedicate
significant resources to the development and enhancement of its present and
future products.  There can be no assurance that the Company's development
efforts will be successful or that the Company will have adequate capital to
fund such research and development.  See "Risk Factors -- Future Capital Needs;
Uncertainty of Additional Funding."


CONFLICTS OF INTEREST

                 The Company's Board of Directors includes, and is expected to
continue to include, persons designated by strategic partners of the Company
and other parties that have business relationships with the Company.





<PAGE>   9

It is possible that the companies designating such directors, such as Motorola
and other companies in which a director may hold a financial interest, may be
in direct or indirect competition with the Company or among themselves,
including competition with respect to certain business activities and
transactions that the Company may propose to undertake.  Although the affected
directors may abstain from voting on matters in which the interests of the
Company and those of another company with which they are affiliated are in
conflict, the presence of potential or actual conflicts could affect the
process or outcome of Board deliberations in ways that could be adverse to the
Company.


CONTROL BY EXISTING STOCKHOLDERS

   
                 As of November 29, 1996, the officers and directors of the
Company, together with entities affiliated with directors of the Company,
beneficially own approximately 33.2% of the Common Stock (assuming the exercise
of immediately available stock options to purchase Common Stock).  Accordingly,
these stockholders, if acting in concert, will be able to elect all of the
Company's directors and to determine the outcome of corporate actions requiring
stockholder approval, regardless of how other stockholders of the Company may
vote.  The voting power of these stockholders under certain circumstances could
have the effect of delaying or preventing a change in control of the Company.
Under a Shareholders' Agreement, Motorola has the right to nominate for
election a number of directors proportionate to their respective holdings of
outstanding shares of Common Stock in the case of Motorola, as long as it holds
at least 10% of the outstanding shares it may nominate at least one director,
and that if it holds at least 20% of the outstanding shares it may nominate at
least two directors.  The Principal stockholders of the Company have agreed to
vote in favor of each such nominee.
    

                               DIVIDEND POLICY

                 To date, the Company has paid no cash dividends on its Common
Stock.  The Company currently intends to retain all future earnings, if any, to
fund the development and growth of its business and, therefore, does not
anticipate paying any cash dividends in the foreseeable future.


   
                 The terms of the Preferred Stock prohibit the Company from
paying dividends except out of retained earnings of the Company generated after
April 1, 1997. Under the terms of the Loan and Security Agreement with Sanwa
Business Credit Corporation ("Sanwa") that provides a revolving credit facility
of up to Twenty Million dollars ($20,000,000) (the "Loan"), the Company is
prohibited from paying dividends during the term of the Loan.
    

                                 THE COMPANY

OVERVIEW

                 The Company is in the fixed wireless telecommunications
industry.  The Company designs, develops, manufactures and markets products
based on its proprietary interface technologies, which provide the capability
to bridge wireline telecommunications customer premises equipment ("CPE") with
cellular-type transceivers for use in wireless communication networks, whether
cellular, enhanced specialized mobile radio ("ESMR"), personal communications
services ("PCS"), or satellite-based.  Applications of the Company's technology
include fixed wireless telecommunications as a primary service where wireline
systems are unavailable, unreliable or uneconomical and as wireless backup
systems for wireline telephone systems and wireless security alarm transmission
systems.  The Company's principal product lines -- PHONECELL(R) and TELGUARD(R)
- -- allow CPE designed for traditional wireline networks to send and receive
voice, data and facsimile signals over wireless networks.

                 The Company was founded in June 1986 by Mr. William L. De
Nicolo, the current Chairman of the Board of the Company, when he acquired
title to the intellectual property rights of a pending patent application
dealing with a "cellular interface" concept and methodology.  The patent not
only describes a simple physical circuit or device, but also the very concept
and principles underlying the use of intelligent interface device (the
"invention") in conjunction with cellular-type transceivers and systems.

   
                 In January 1994, the Company completed an initial public
offering of its common stock and is traded on the NASDAQ National Market 
System under the ticker symbol "WRLS".
    


COMPANY STRATEGY

   
                 The Company's strategy is to leverage its market experience,
internationally-accepted products, and patents into a leadership position in
the rapidly developing Wireless Alternate Access ("WAA") and Wireless Local
Loop ("WLL") subscriber terminal equipment industry.  Global telecommunications
equipment manufacturers together with national and
    





<PAGE>   10

international service providers are increasingly sharing the Company's vision
that wireless systems in both developed and developing countries are well
suited for use as basic telephone service networks.  The key trends that are
fueling the worldwide adoption of WAA/WLL programs include the following:

                 -        Rapid acceptance of cellular mobile communications;

                 -        An accelerating trend toward privatization of
                          telecommunication service in both developed and 
                          developing countries;

                 -        Development and adoption of digital wireless
                          transmission standards (e.g., Time Divisional
                          Multiple Access ("TDMA"), Group Special Mobile
                          ("GSM") and Code Division Multiple Access ("CDMA"))
                          which enhance network capacity and service capability
                          while significantly reducing the effective cost per
                          subscriber served;

                 -        Service network providers acceptance of wireless
                          network solutions as fast, cost effective answers to
                          their customers' unmet demand for telecommunications;
                          and,

                 -        PCS licensing and the proposed telecommunications
                          legislation within the U.S. should intensify
                          competition by wireless service providers to capture
                          wireless minutes of usage.

                 Based upon its proprietary interface technology, the Company
designs, manufacturers and markets a full line of WAA/WLL products which allow
cost-effective, innovative communications solutions where wired facilities are
(1) of substandard quality, (2) unavailable on a timely basis, (3) too costly,
or, (4) in need of alternative access or backup/diverse routing capability for
local telephone service exists.


   
CAPITAL RESOURCES
    

   
                 The Company has issued 20,000 shares of Preferred Stock. On 
April 16, 1997, the Company issued to each of Nelson Partners and Olympus
Securities Ltd. 5,000 shares of Preferred Stock (collectively 10,000 shares) in
exchange for Ten Million Dollars ($10,000,000) pursuant to a private placement. 
On June 6, 1997, the Company issued to each of Stark International and Shepherd
International Investments, Ltd. 5,000 shares of Preferred Stock (collectively,
10,000 shares) in exchange for Ten Million Dollars ($10,000,000) pursuant to a
private placement (collectively, the purchasers of the Company's Preferred Stock
are referred to as the "Investors"). The conversion terms of the Preferred 
Stock reflect the equivalent of a 5% annual stock dividend.  The Preferred 
Stock automatically converts to shares of the Company's Common Stock on April 
16, 1999, or October 16, 1999, depending upon the conversion price.  Prior to 
maturity, the Preferred Stock is convertible by the holders of the Preferred 
Stock under specific terms and conditions which include "collars" on the 
conversion price and limitations on related stock trading.  In both cases, the 
conversion formula is based upon the Nasdaq closing bid prices for the 
Company's Common Stock.  The Company also has the right to redeem the 
Preferred Stock for cash at defined terms.  Senior management anticipates that 
the funds will be used for the development of new products for the worldwide 
fixed wireless terminal business.
    

   
                 Under the terms of the registration rights agreements between 
the Company and the Investors, the Company agreed to register under the
Securities Act on behalf of the Investors a number of shares of Common Stock
equal to the aggregate of each Investors pro-rata share of the Common Stock
issued or issuable to the Investors upon the conversion of the Preferred Stock
("Registrable Securities") and to keep such registration effective until the
earlier of:  (i) the date as of which the Investors may sell all of the
Registrable Securities, without restriction pursuant to Rule 144(k) under the
1933 Act (or successor thereto), or (ii) the date on which (A) the Investors
have sold all of the Registrable Securities and (B) none of the Preferred Stock
is outstanding.  Pursuant to the above-referenced obligations the Company filed
a registration statement on Form S-3 with the SEC on May 28, 1997, and filed an
amendment to that registration statement on June 13, 1997.
    

   
                 On April 23, 1997, the Company entered into the Loan with 
Sanwa that provides a revolving credit facility of up to Twenty Million Dollars
($20,000,000). Borrowings under the Loan are subject to borrowing base
requirements and other restrictions.  Under the Loan, the Company is required
to comply with affirmative and negative covenants.  The Loan replaces a prior
credit facility. Senior management anticipates that the Loan will be used to
meet demands on working capital requirements associated with certain large
wireless local loop projects that the Company intends to bid on.
    


RESEARCH AND DEVELOPMENT

   
                 The Company believes that its future success depends on its
ability to adapt to the rapidly changing telecommunications environment and to
continue to meet customers' needs.  The Company is currently adapting its
products to new wireless technologies and is working closely with several
companies, including long-distance carriers, cellular service providers and
telecommunications infrastructure providers and equipment manufacturers, to
develop new fixed wireless products.  
    

   
                 For example, pursuant to the terms of the Stock Purchase 
Agreement, between the Selling Shareholder and the Company, dated as of June
28, 1996 (the "Stock Purchase Agreement"), the Selling Shareholder has
undertaken to develop certain fixed wireless products for the Company.  See
"Selling Shareholder."  The agreement calls for the Company to increase its
equity position in Wireless Domain to 50% by August of 1997 by purchasing an
additional one-sixth of Wireless Domain for 150,000 shares of the Company's
common stock as well as payments totaling $0.5 million in two separate
transactions.  The first of the two additional investments in Wireless Domain
occurred during the second quarter of fiscal year 1997.  In January 1997, the
Company exchanged $0.25 million in cash and 75,000 shares of the Company's
common stock (approximate value of $0.5 million) for an additional one-twelfth
of Wireless Domain.  Under the agreement, the Company purchases various product
development services from Wireless Domain. The Company spent $0.5 million and
$1.1 million respectively on such services from Wireless Domain during the
three months and six months ended March 31, 1997. This relationship provides
the Company, subject to certain terms of the Stock Purchase Agreement, with
access to an additional 24 engineers. Additionally, Motorola has also agreed to
fund certain product development activities. Additionally, Motorola has also
agreed to fund certain product development  activities.
    

   
                 As of May 15, 1997, the Company's research and development
staff was comprised of 18 engineers and is focused on bringing new products to
market in the most advantageous and timely manner possible.  Additionally, the
research staff continually investigates methods by which the Company can reduce
the costs of its products.
    

                 The Company is currently adapting its products to digital
wireless standards, including GSM, DCS1800, PCS1900, TDMA and CDMA as well as
satellite-based systems.


MANUFACTURING

   
                 Fabrication of the Company's products is accomplished through
a combination of in-house manufacturing and subcontracting.  The Company
manufactures security alarm transmission products and fixed wireless terminals 
at its facility in Vernon Hills.  The Company has developed proprietary testing
equipment and procedures to conduct comprehensive quality control and quality
assurance throughout the manufacturing and assembly process.  Quality programs
are a high priority at the Company; since 1994, the Company has been designated
as an ISO 9001 certified Company.
    

                 The Company historically has contracted with several suppliers
for the critical components of its products.  The major exception to this
policy has been transceiver units, which are principally supplied by Motorola.
The Company's interface technology is compatible with several other
manufacturers' transceivers, and the Company





<PAGE>   11

believes it could obtain transceivers from such manufacturers if sufficient
quantities were not available from Motorola, although not necessarily on
equivalent terms.


                             SELLING SHAREHOLDER


   
                 All of the shares offered hereby were issued by the Company 
to the Selling Shareholder.  The shares were issued to the Selling Shareholder
pursuant to the Stock Purchase Agreement.  The shares constituted part of the
consideration for the Selling Shareholder's grant to the Company of an equity
interest in the Selling Shareholder.  The Company currently has a 42% equity
interest in the Selling Shareholder.
    

                 Pursuant to the terms of the Stock Purchase Agreement, the
Company agreed to register the Common Stock issued to the Selling Shareholder
pursuant to the Stock Purchase Agreement under the Securities Act and to keep
such registration effective until the earlier of: (a) two years from the
effective date of the Registration Statement, or (b) the date upon which the
Selling Shareholder is able to resell all of the Common Stock registered
pursuant to the Registration Statement that covers this Prospectus.

   
                 The following table sets forth certain information regarding 
beneficial ownership of the Company's Common Stock as of the date hereof
(unless otherwise noted) held by the Selling Shareholder.  As stated
previously, the Company has a Forty-Two Percent (42%) equity interest in the
Selling Shareholder.  Additional information regarding the nature of the
Company's investment in the Selling Shareholder is set forth in the Company's
SEC Filings.
    

   
<TABLE>
<CAPTION>
                          Shares                                              Shares
                          Beneficially Owned                 Shares           Beneficially
                          Prior to the                       Being            Owned
                          Offering                           Offered          After Offering
                          ------------------                 -------          ----------------------
                                                                              Number         Percent
                                                                              ------         -------
<S>                       <C>                               <C>                <C>            <C>     
Wireless Domain           425,000                           425,000            -0-             0%
</TABLE>
    

                             PLAN OF DISTRIBUTION


                 The purpose of this Prospectus is to permit the Selling
Shareholder, if it desires, to dispose of some or all of the shares at such
times and at such prices as it may choose.  Whether sales of shares will be
made, and the timing and amount of any sale made, is within the sole discretion
of the Selling Shareholder.

                 The Common Stock covered by this Prospectus may be offered for
sale from time to time by the Selling Shareholder to or through underwriters or
directly to other purchasers or through agents in one or more market
transactions, in one or more private transactions or in a combination of such
methods of sale, at prices then prevailing, at prices related to such prices or
at negotiated prices.  Such methods of distribution may include, without
limitation:  (a) a block trade in which the broker-dealer so engaged will
attempt to sell the Common Stock as agent but may position and resell a portion
of the block as a principal to facilitate the transaction; (b) purchases by a
broker-dealer as a principal and resale by such broker-dealer for its own
account pursuant to this Registration Statement; (c) ordinary brokerage
transactions and transactions in which the broker solicits purchasers; and (d)
face-to-face transactions between sellers and purchasers without a broker or
dealer.  This Prospectus may be amended and supplemented from time to time to
describe a specific plan of distribution.

                 In connection with distributions of the Common Stock or
otherwise, the Selling Shareholder 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 Common Stock in the course of hedging the positions they assume
with the Selling Shareholder.  The Selling Shareholder may also sell Common
Stock short and redeliver the shares to close out such short positions.  The
Selling Shareholder may also enter into options or other transactions with
broker-dealers or other financial institutions which require the delivery to
such broker-dealer or financial institution of the Common Stock offered hereby,
which Common Stock such broker-dealer or other financial institutions may
resell pursuant to this Prospectus (as supplemented or amended to reflect such
transaction).  The Selling Shareholder may also pledge the shares registered
hereunder 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 Common Stock pursuant to this Prospectus (as supplemented or
amended to reflect such transaction).  In addition, any Common Stock covered by
this Prospectus that qualifies for sale pursuant to Rule 144 under the
Securities Act may be sold under Rule 144 rather than pursuant to this
Prospectus.

                 Brokers, dealers or agents may receive compensation in the
form of commissions, discounts or concessions from the Selling Shareholder in
amounts to be negotiated in connection with sales pursuant thereto.  Such
brokers or dealers and any other participating brokers or dealers may be deemed
to be "underwriters" within the meaning of the Securities Act, in connection
with such sales and any such commission, discount or concession may be deemed
to be underwriting discounts or commissions under the Securities Act.





<PAGE>   12

                 Certain costs, expenses and fees in connection with the
registration of the Common Stock will be borne by the Company.  Commissions,
discounts and transfer taxes, if any, attributable to the sales of the Common
Stock will be borne by the Selling Shareholder.  The Selling Shareholder has
agreed or may agree to indemnify the Company or any underwriter, as the case
may be, and any of their respective affiliates, directors, officers and
controlling persons, against certain liabilities in connection with the
offering of the Common Stock pursuant to this Registration Statement, including
liabilities arising under the Securities Act.  In addition, the Company has
agreed to indemnify the Selling Shareholder or any underwriter, as the case may
be, and any of their respective affiliates, directors, officers and controlling
persons, against certain liabilities in connection with the offering of the
Common Stock pursuant to this Prospectus, including liabilities arising under
the Securities Act.

                 The Company has agreed to supply the Selling Shareholder with
such number of copies of this Prospectus as it may reasonably request.  The
Selling Shareholder will in all cases be responsible for complying with the
prospectus delivery requirements of Section 5(b)(2) of the Securities Act in
connection with the offering and sale of the shares.


                                LEGAL MATTERS


         Certain legal matters in connection with the securities offered hereby
are being passed upon for the Company by Covington & Burling, Washington, D.C.


                                   EXPERTS


   
         The consolidated financial statements of Telular Corporation appearing
in Telular Corporation's Form 10-K for the year ended September 30, 1996, have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon included therein and incorporated herein by reference.  Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report given upon the authority of such firm as experts in
accounting and auditing.
    





<PAGE>   13


                                   PART II

                    INFORMATION NOT REQUIRED IN PROSPECTUS



Item 14.  Other Expenses of Issuance and Distribution*

         The expenses payable by the Registrant in connection with the issuance
and distribution of the securities being registered hereby (other than
underwriting discounts and commissions) are set forth below:


   
<TABLE>                                                                     
         <S>                                                                   <C>
         Securities and Exchange Commission Registration Fee  . . . . . . .   $ 1,096.50
                                                                                -------- 
         Nasdaq Listing Fee . . . . . . . . . . . . . . . . . . . . . . . .        2,383 
                                                                                -------- 
         Blue Sky Fees and Expenses . . . . . . . . . . . . . . . . . . . .        0     
                                                                               --------- 
         Accounting Fees and Expenses . . . . . . . . . . . . . . . . . . .        5,000 
                                                                                -------- 
         Legal Fees and Expenses  . . . . . . . . . . . . . . . . . . . . .       20,000
                                                                                 ------- 
         Registrar and Transfer Agent's Fees and Expenses . . . . . . . . .        0     
                                                                               --------- 
         Miscellaneous Expenses . . . . . . . . . . . . . . . . . . . . . .        1,000 
                                                                                -------- 
         Printing Costs . . . . . . . . . . . . . . . . . . . . . . . . . .        0     
                                                                               --------- 
                                                                               
                                                         Total                $29,479.50
                                                                              ----------
</TABLE>
    

- ---------------------

*        Except for the Securities and Exchange Commission registration fee and
the Nasdaq listing fee all expenses are estimated.


Item 15.  Indemnification of Officers and Directors

   
                 Section 145 of the General Corporation Law of the State of
Delaware (the "DGCL") provides that a corporation may indemnify any person,
including any officer or director, who was or is a party or who is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation), by reason of the fact
that he is or was a director, officer, employee or agent of the corporation or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise ("such Person"), against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement, actually and reasonably
incurred by such Person, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.  In any threatened,
pending or completed action by or in the right of the corporation, a
corporation also may indemnify any such Person for costs actually and
reasonably incurred by him in connection with that action's defense or
settlement, if he acted in good faith and in a manner reasonably believed to be
in or not opposed to the best interests of the corporation; however, no
indemnification shall be made with respect to any claim, issue or matter as to
which such Person shall have been adjudged to be liable to the corporation,
unless and only to the extent that a court shall determine that such indemnity
is proper.  Where a director, officer, employee or agent is successful on the
merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him against the expenses (including attorneys' fees)
that such officer or director actually and reasonably incurred.
    

                 The Registrant's Bylaws provide that the Registrant will
indemnify such Persons against all liability and expense arising out of such
Person's connection with the business of the Registrant, provided that the
Board of Directors determines that such Person acted in good faith and
reasonably believed that his actions were not opposed to the best interests of
the Registrant; and with respect to any criminal action or proceeding, that
such Person had no reasonable cause to believe his conduct was unlawful.  In
the case of any action, suit or proceeding by or in the right of the Registrant
in which such Person is adjudged liable to the Registrant, the Registrant will
indemnify such Person for expenses only to the extent that the court in which
such action is brought determines, upon application, that such Person is
entitled to indemnity for reasonable expenses, and in no case shall such
indemnification extend to liability.  Advances against reasonable expenses may
be made by the Registrant on terms fixed by the Board of Directors subject to
an obligation to repay if indemnification proves unwarranted.





                                     II-1
<PAGE>   14


                 The Registrant's Certificate of Incorporation provides that,
to the fullest extent permitted by Delaware law, its directors shall not be
liable for monetary damages for breach of the directors' fiduciary duty to the
Registrant and its stockholders.  This provision in the Certificate of
Incorporation does not eliminate the duty of care.  In appropriate
circumstances, equitable remedies such as injunctive or other forms of
non-monetary relief will remain available under Delaware law.  In addition,
each director will continue to be subject to liability for breach of the
director's duty of loyalty to the Registrant or its stockholders, for acts or
omissions not in good faith or involving intentional misconduct or knowing
violations of law, for actions leading to improper personal benefit to the
director, and for payment of dividends or approval of stock repurchases or
redemptions that are unlawful under Delaware law.  The provision also does not
affect a director's responsibilities under any other law, such as the federal
securities laws or state or federal environmental laws.

                 Directors and officers of the Registrant are covered by a
directors' and officers' liability insurance policy of the Registrant.


Item 16.  Exhibits

   
<TABLE>
<CAPTION>
Exhibit
Number                 Description                           Reference
- -------                -----------                           ---------
<S>             <C>                               <C>
                Instruments defining the rights
                  of Security Holders
                
 4.1            Certificate of Incorporation      Incorporated by reference to
                                                  Exhibit 3.1 to the Registration State-
                                                  ment of the Company on Form
                                                  S-1, Registration No. 33-72096, as
                                                  amended ("Form S-1")
                                                  
 4.2            Amendment No. 1 to                Incorporated by reference to
                Certificate of Incorporation      Exhibit 3.2 to Form S-1
                                                  
                                                  
 4.3            Amendment No. 2 to                Incorporated by reference to
                Certificate of Incorporation      Exhibit 3.3 to Form S-1
                                                  
 4.4            Amendment No. 3 to                Incorporated by reference to
                Certificate of Incorporation      Exhibit 3.4 to the Company's
                                                  Form 10-Q filed on May 16,
                                                  1997

 4.5            Bylaws                            Incorporated by reference to
                                                  Exhibit 3.4 to Form S-1
                                                  
 4.6            Certificate of Designation of     Incorporated by reference to
                Rights and Preferences of         Exhibit 99.2 to the Current
                Series A Convertible Preferred    Report of the Company on                           
                Stock                             Form 8-K filed on April 25, 
                                                  1997

                Opinion on legality of Common     
                  Stock being registered          
                                                  
 5.1            Opinion of Covington & Burling    Filed herewith
                                                  
                Consents of experts and counsel   
                                                  
23.1            Consent of Covington & Burling    Filed herewith as Exhibit 5.1
                
23.2            Consent of Ernst & Young          Filed herewith

                Additional Exhibits

99. 1           Stock Purchase Agreement          Incorporated by reference to Exhibit 10.3 to the
                between the Company and           Company's Form 10-Q filed on August 15, 1996,
                Wireless Domain (formerly
                Telepath Corporation),
                dated June 28, 1996

99.2            Securities Purchase               Incorporated by reference to Exhibit 99.1 to the
                Agreement dated April 16,         Company's Form 8-K filed on April 25, 1997
                1997, by and between the
                Company and the purchasers
                of the Series A Convertible
                Preferred Stock

99.3            Registration Rights Agreement     Incorporated by reference to Exhibit 99.3 to the
                dated April 16, 1997, by and      Company's Form 8-K dated April 25, 1997
                between the Company and
                purchasers of the Series A
                Convertible Preferred Stock

99.4            Securities Purchase Agreement     Incorporated by reference to Exhibit 99.3 to the
                dated June 6, 1997, by and        Registration Statement of the Company on Form S-3,
                between the Company and           Registration No. 333-27915, as amended by Amendment
                purchasers of the Series A        No. 1 filed June 13, 1997
                Convertible Preferred Stock

99.5            Registration Rights Agreement     Incorporated by reference to Exhibit 99.4 to the
                dated June 6, 1997, by and        Registration Statement of the Company on Form S-3,
                between the Company and           Registration No. 333-27915, as amended by Amendment
                purchasers of the Series A        No. 1 filed June 13, 1997
                Convertible Preferred Stock
</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 the Registration Statement:

                                  (i)      To include any prospectus required
                                           by Section 10(a)(3) of the 
                                           Securities Act;





                                     II-2
<PAGE>   15


                                  (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;

                                  (iii)    To include any material information
                                           with respect to the plan of
                                           distribution not previously
                                           disclosed in the Registration
                                           Statement or any material change to
                                           such information in the Registration
                                           Statement;

                                  Provided, however, that paragraphs (a)(1)(i)
                                  and (a)(1)(ii) do not apply if the
                                  information required to be included in a
                                  post-effective amendment by those paragraphs
                                  is contained in periodic reports filed 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 registered which remain unsold at
                                  the termination of the offering.

                 (b)      The Registrant hereby undertakes that, for purposes
                          of determining any liability under the Securities
                          Act, each filing of the Registrant's annual report
                          pursuant to Section 13(a) or Section 15(d) of the
                          Exchange Act that is incorporated by reference in the
                          Registration Statement shall be deemed to be a new
                          Registration Statement relating to the Common Stock
                          therein, and the offering of such Common Stock at
                          that time shall be deemed to be the initial bona fide
                          offering thereof.

                 (c)      Insofar as indemnification for liabilities arising
                          under the Securities Act may be permitted to
                          directors, officers and controlling persons of the
                          Registrant pursuant to the foregoing provisions, 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 such 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.





                                     II-3
<PAGE>   16

                                  SIGNATURES


   
         Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment to the 
Registration Statement to be signed on its behalf by the undersigned, 
thereunto duly authorized in Vernon Hills, State of Illinois, on the 13th day 
of June, 1997.
    


                                        TELULAR CORPORATION
                                          (Registrant)




                                        By /s/ Kenneth E. Millard      
                                           ---------------------------
                                           Kenneth E. Millard
                                           Chief Executive Officer

   
    


   
         Pursuant to the requirements of the Securities Act, this Amendment to
the Registration Statement has been signed by the following persons in the 
capacities and on the dates indicated.
    


   
<TABLE>
<CAPTION>
Signature                         Title                                        Date
- ---------                         -----                                        ----
<S>                               <C>                                          <C>
/s/ Kenneth E. Millard            Chief Executive Officer and Director         June 13, 1997   
- ----------------------            (principal executive officer)                                    
Kenneth E. Millard
                                  
/s/ Thomas M. Mason               Senior Vice President, Chief                 June 13, 1997   
- ------------------------          Financial Officer and Secretary                                
Thomas M. Mason                   (principal financial officer)  

/s/ William L. De Nicolo*         Director and Chairman of the Board           June 13, 1997     
- ------------------------                                                                         
William L. De Nicolo

/s/ John E. Berndt                Director                                     June 13, 1997   
- -------------------                                                                              
John E. Berndt
</TABLE>
    





                                     II-4
<PAGE>   17

<TABLE>
<S>                               <C>                      <C>
/s/ Larry J. Ford*                Director                 June 13, 1997
- -----------------                                                            
Larry J. Ford                                              
                                                           
                                                           
/s/ Richard D. Haning*            Director                 June 13, 1997
- ---------------------                                                        
Richard D. Haning                                          
                                                           
/s/ David P. Mixer*               Director                 June 13, 1997
- ------------------                                                           
David P. Mixer                                             
</TABLE>

* By Kenneth E. Millard, attorney-in-fact



                                     II-5

<PAGE>   1
                                                                     EXHIBIT 5.1



                                                                 June 13, 1997


Telular Corporation
920 Deerfield Parkway
Buffalo Grove, Illinois  60089

Gentlemen:

                     This opinion is being furnished to you in connection
with the public resale by Wireless Domain, Inc. ("Wireless") of up to 425,000
shares of Telular Corporation's (the "Company") Common Stock, par value $.01
per share (the "Shares") pursuant to the registration statement filed by the
Company under the Securities Act of 1933 on September 25, 1996, with the
Securities and Exchange Commission (the "Commission"), as amended by Amendment
No. 1, of even date herewith (which registration statement, as amended by all
amendments, is hereinafter called the "Registration Statement"). The Shares
were issued to Wireless by the Company under the terms of that certain Stock
Purchase Agreement, between Wireless and the Company, dated as of June 28,
1996, and may be sold from time-to-time by Wireless to or through brokers,
dealers or other agents or directly to other purchasers in one or more market
transactions, in one or more private transactions, or in a combination of such
methods of sale, at prices then prevailing, at prices related to such prices,
or at negotiated prices.

                     We have acted as counsel for the Company in connection 
with the issue and sale of the Shares to Wireless. We have examined signed 
copies of the Registration Statement and all exhibits thereto, all as filed 
with the Commission. We have also examined and relied upon certain resolutions 
adopted by the Board of Directors of the Company, certified by the Secretary 
of the Company, a copy of the Bylaws of the Company, and a copy of the 
Certificate of Incorporation of the


<PAGE>   2


Telular Corporation
June 13, 1997
Page - 2 -



Company certified by the Secretary of the State of the State of Delaware. We
also have examined such other documents and made such other investigations as
we have deemed necessary to form a basis for the opinion hereinafter expressed.

                     In examining the foregoing documents we have assumed
the authenticity of documents submitted to us as originals, the genuineness of
all signatures, the conformity to original documents of documents submitted as
copies, and the accuracy of the representations and statements included
therein.

                     Based upon the foregoing, it is our opinion that the
Shares issued to and to be sold by Wireless pursuant to the Registration
Statement are duly authorized, validly issued, fully paid and non-assessable.

                     We hereby consent to the filing of this opinion as
part of the Registration Statement, and to the use of our name therein and in
the related Prospectus under the caption "Legal Matters".

                     It is understood that this opinion is to be used
only in connection with the offer and sale of the Shares while the Registration
Statement is in effect.

                                         Very truly yours,



                                         COVINGTON & BURLING










<PAGE>   1
                                                                    EXHIBIT 23.2



                        CONSENT OF INDEPENDENT AUDITORS



We consent to the reference to our firm under the caption "Experts" and to the
use of our report dated November 8, 1996, in Amendment No. 1 to the
Registration Statement (Form S-3 No. 333-12705) and related Prospectus of
Telular Corporation for the registration of 425,000 shares of its common stock.




                                         Ernst & Young LLP


Chicago, Illinois
June 13, 1997










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