<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
ON OCTOBER 15, 1996 Registration No. 333-_________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
HEARTLAND WIRELESS COMMUNICATIONS, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 4841 73-1435149
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or organization) Classification Code Number) Identification No.)
</TABLE>
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200 CHISHOLM PLACE, SUITE 200
PLANO, TEXAS 75075
(972) 423-9494
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
----------
JOHN R. BAILEY
SENIOR VICE PRESIDENT - FINANCE
AND CHIEF FINANCIAL OFFICER
HEARTLAND WIRELESS COMMUNICATIONS, INC.
200 CHISHOLM PLACE, SUITE 200
PLANO, TEXAS 75075
(972) 423-9494
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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COPY TO:
VICTOR B. ZANETTI, ESQ.
ARTER & HADDEN
1717 MAIN STREET, SUITE 4100
DALLAS, TEXAS 75201
(214) 761-4475
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF
THE SECURITIES TO THE PUBLIC:
As soon as practicable after this Registration Statement becomes effective.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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<CAPTION>
================================================================================================================================
PROPOSED PROPOSED
AMOUNT MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF TO BE OFFERING AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PRICE PER SHARE(2) OFFERING PRICE (2) FEE
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<S> <C> <C> <C> <C>
COMMON STOCK, $.001 PAR VALUE (1) 1,250,000 SHARES $24.25 $30,312,500 $10,453
================================================================================================================================
</TABLE>
(1) This Registration Statement also relates to all shares of Common Stock
registered hereunder which may be offered for resale by persons who
receive from the Registrant such Common Stock in acquisitions, as more
fully described in the Prospectus forming a part of this Registration
Statement.
(2) Estimated solely for purposes of calculating the registration fee
based upon the average of the high and low sales prices of the Common
Stock on the Nasdaq Stock Market's National Market on October 11, 1996
in accordance with Rule 457(c).
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, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
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<PAGE> 2
HEARTLAND WIRELESS COMMUNICATIONS, INC.
CROSS REFERENCE SHEET
<TABLE>
<CAPTION>
Item of Form S-4 Location in Prospectus
---------------- ----------------------
<S> <C> <C>
1. Forepart of Registration Statement . . . . . . . . . . . Facing Page of Registration Statement; Cross
Reference Sheet; Outside Front Cover Page of
Prospectus
2. Inside Front and Outside Back Cover Pages of
Prospectus . . . . . . . . . . . . . . . . . . . . . . . Inside Front and Outside Back Cover Pages of
Prospectus; Available Information; Incorporation
of Certain Documents by Reference
3. Risk Factors, Ratio of Earnings to Fixed
Charges and Other Information . . . . . . . . . . . . . The Company; Risk Factors; Incorporation of
Certain Documents by Reference
4. Terms of the Transaction . . . . . . . . . . . . . . . . The Company; Offered Securities;*
5. Pro-Forma Financial Information . . . . . . . . . . . . *
6. Material Contracts with the Company Being Acquired . . . *
7. Additional Information Required for Reoffering by
Persons and Parties Deemed to be Underwriters . . . . . *
8. Interests of Named Experts and Counsel . . . . . . . . . **
9. Disclosure of Commission Position on Indemnification
for Securities Act Liabilities . . . . . . . . . . . . . **
10. Information with Respect to S-3 Registrants . . . . . . The Company; Incorporation of Certain Documents
by Reference
11. Incorporation of Certain Information by Reference . . . Incorporation of Certain Documents by Reference
12. Incorporation with Respect to S-2 or S-3 Registrants . . **
13. Incorporation of Certain Information by Reference . . . **
14. Information with Respect to Registrants Other than
S-3 or S-2 Registrants . . . . . . . . . . . . . . . . . **
15. Information with Respect to S-3 Companies . . . . . . . *
16. Information with Respect to S-2 or S-3 Companies . . . . *
17. Information with Respect to Companies Other than
S-2 or S-3 Companies . . . . . . . . . . . . . . . . . . *
18. Information if Proxies, Consents or Authorizations
are to be Solicited . . . . . . . . . . . . . . . . . . *
19. Information if Proxies, Consents or Authorizations
are not to be Solicited or in an Exchange Offer . . . . *
</TABLE>
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* Inapplicable (or partially inapplicable as indicated) upon filing of
this Registration Statement - may be included in subsequent amendments
under certain circumstances.
** Not applicable or answer is negative.
<PAGE> 3
***************************************************************************
* *
* INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. *
* A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED *
* WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY *
* NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE *
* REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT *
* CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY *
* NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH *
* SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO THE *
* REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH *
* STATE. *
* *
***************************************************************************
SUBJECT TO COMPLETION - DATED OCTOBER 15, 1996
PROSPECTUS
----------
HEARTLAND WIRELESS COMMUNICATIONS, INC.
1,250,0000 SHARES OF COMMON STOCK, $.001 PAR VALUE
----------
This Prospectus relates to 1,250,000 shares of common stock, par value
$.001 per share ("Common Stock"), of Heartland Wireless Communications, Inc.
(the "Company") that may be offered and issued by the Company from time to time
in connection with its continuing program of acquisitions.
The Company anticipates that its future acquisitions will consist
primarily of additional wireless cable television channel rights and systems in
small to mid-size markets located principally in the central United States. If
the opportunity arises, however, the Company may attempt to consummate
transactions which are either complementary to its present business or which
the Company considers advantageous even though they may be dissimilar to the
Company's present activities. The consideration for such acquisitions is
expected to consist of Common Stock, cash, notes or other evidences of
indebtedness, property, exchange of assets, assumptions of liabilities or a
combination thereof, as determined from time to time by negotiations between
representatives of the Company and the owners or controlling persons of the
business or the wireless cable channel rights or system to be acquired. In
addition, the Company may enter into collateral arrangements associated with
such acquisitions including management, consulting, employment and
noncompetition agreements with the former owners (or their affiliates) and key
executive personnel of the businesses or systems to be acquired, and pay
consideration thereof consisting of Common Stock, cash or a combination
thereof.
The shares covered by this Prospectus may be issued in exchange for
shares of capital stock, partnership interests or other assets representing an
interest, direct or indirect, in other companies or other entities, in exchange
for assets used in or related to the business of such entities or otherwise
pursuant to the agreements providing for such acquisitions. The terms of an
acquisition are generally determined by negotiations between the Company's
representatives and the owners or controlling persons of the business or
wireless cable channel rights or system to be acquired or, in the case of
entities that are more widely held, through exchange offers to stockholders or
documents soliciting the approval of statutory mergers, consolidations or sales
of assets. The Company considers several factors when assessing a potential
acquisition including the value placed by the parties on the assets to be
acquired, the number of subscribers, the cash flow anticipated by the target,
growth potential, location of the channel rights or systems to be acquired,
regulatory matters, the current and potential future market value of the Common
Stock and the tax treatment of the proposed acquisition. The Company
anticipates that shares of Common Stock issued in any such acquisition will be
valued at a price reasonably related to the market value of the Common Stock,
either at the time the terms of the acquisition are tentatively agreed upon, at
or about the time of closing, or during the period or periods prior to delivery
of the shares.
All of the 1,250,000 shares of Common Stock which may be offered and
issued by the Company as described above may, subject to certain conditions, be
resold pursuant to this Prospectus by the persons who receive such shares in
acquisitions. See "Resales and Plan of Distribution."
It is not expected that underwriting discounts or underwriting
commissions will be paid by the Company in connection with this offering or the
issuance of the Common Stock in connection with any acquisition.
The Common Stock is included in the Nasdaq Stock Market's National
Market (the "Nasdaq National Market") under the symbol "HART." On October 11,
1996, the last reported sales price for the Common Stock was $25.125 per share.
SEE "RISK FACTORS" ON PAGE 6 FOR A DISCUSSION OF CERTAIN MATERIAL
FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE
SHARES OF COMMON STOCK OFFERED HEREBY.
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 October __, 1996.
<PAGE> 4
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission" or "SEC") a Registration Statement on Form S-4 (together with all
amendments, exhibits, schedules and supplements thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act")
with respect to the Common Stock offered hereby. As permitted by the rules and
regulations of the Commission, this Prospectus omits certain information
contained in that Registration Statement. For further information with respect
to the Company and the Common Stock offered hereby, reference is hereby made to
the Registration Statement. The Registration Statement may be inspected
without charge at the Public Reference Section of the Commission at Judiciary
Plaza, Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and copies
may be obtained therefrom at prescribed rates. Statements contained herein
concerning provisions of documents are necessarily summaries of such documents,
and each statement is qualified in its entirety by reference to the copy of the
applicable document filed with the Commission.
The Company is subject to the informational reporting 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 Commission. Such reports, proxy statements and other information
filed by the Company with the Commission may be inspected and copied at the
Public Reference Section of the Commission at Judiciary Plaza, Room 1024, 450
Fifth Street, N.W., Washington, D.C. 20549 and at the following Regional
Offices of the Commission: Chicago Regional Office, Northwestern Atrium Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661; and New York
Regional Office, Seven World Trade Center, New York, New York 10048. Copies of
such material may also be obtained by mail at prescribed rates from the Public
Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549. In addition, such materials filed electronically by
the Company with the Commission are available at the Commission's World Wide
Web site at http://www.sec.gov.
The Common Stock is listed on the Nasdaq National Market, and reports
and other information concerning the Company may be inspected and copied at the
offices of the Nasdaq National Market at 1735 K Street, N.W., Washington, D.C.
20006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents of the Company filed with the Commission
pursuant to the Exchange Act are hereby incorporated by reference in this
Prospectus: (i) the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1995; (ii) the Company's Quarterly Reports on Form 10-Q for
the quarters ended March 31 and June 30, 1996; (iii) the Company's Current
Reports on Form 8-K (A) dated February 23, 1996, as amended by Form 8-K/A dated
February 23, 1996 (filed with the Commission on April 8, 1996) and Form 8-K/A2
dated February 23, 1996 (filed with the Commission on April 29, 1996), and (B)
dated July 1, 1996; and (iv) the Company's Registration Statement on Form 8-A
dated March 24, 1994.
All reports and other documents filed by the Company with the
Commission pursuant to Sections 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
offering of the Common Stock made hereby shall be deemed to be incorporated by
reference herein and to be a part hereof from the respective dates of filing of
such reports and documents. Any statement contained in a document incorporated
by reference herein shall be deemed to be modified or superseded for purposes
of this Prospectus and the Registration Statement of which it is a part to the
extent that a statement contained herein or in a subsequently filed document
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus or the Registration Statement.
- 2 -
<PAGE> 5
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT
PRESENTED HEREIN OR DELIVERED HEREWITH. THE COMPANY WILL PROVIDE WITHOUT
CHARGE TO ANY PERSON TO WHOM THIS PROSPECTUS IS DELIVERED, UPON THE WRITTEN OR
ORAL REQUEST OF SUCH PERSON, A COPY OF ANY AND ALL OF THE FOREGOING DOCUMENTS
INCORPORATED HEREIN BY REFERENCE (EXCLUDING EXHIBITS UNLESS SPECIFICALLY
INCORPORATED THEREIN). REQUESTS FOR SUCH COPIES SHOULD BE SUBMITTED TO THE
COMPANY AT 200 CHISHOLM PLACE, SUITE 200, PLANO, TEXAS 75075, ATTENTION: J.
CURTIS HENDERSON, VICE PRESIDENT, SECRETARY AND GENERAL COUNSEL, (972)
423-9494.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995
Certain of the matters discussed in this Prospectus include
forward-looking statements that involve risks and uncertainties. Among the
risks and uncertainties to which the Company is subject are the risks inherent
in the Company's limited operating history, the fact that the Company has
recorded net losses since inception, the Company's substantial indebtedness and
its historic inability to realize earnings to cover its fixed charges, the
significant risks associated with managing the Company's growth and the
Company's need for additional financing. As a result, the actual results
realized by the Company could differ materially from the statements made
herein. Potential purchasers of the Common Stock offered hereby are cautioned
not to place undue reliance on the forward-looking statements made in this
Prospectus.
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<PAGE> 6
THE COMPANY
GENERAL
The Company develops, owns and operates wireless cable television
systems, primarily in small to mid-size markets located principally in the
central United States. The Company was incorporated in Delaware in October 1993
to succeed to the wireless cable businesses previously conducted by the
Company's founders, both individually and through various controlled entities.
The Company targets small to mid-size markets with significant numbers
of line-of-sight households that are unpassed by traditional hard-wire cable.
Many of these households, particularly in rural areas, have limited access to
local off-air VHF/UHF channels (such as ABC, NBC, CBS and Fox), and typically
do not have access to pay television service except via satellite receivers.
As a result, the Company believes that its wireless cable television service is
an attractive alternative to existing choices for such households. The Company
believes that it will ultimately achieve a penetration rate of the unpassed
line-of-sight households in its markets that is comparable to the average
penetration rate achieved by traditional hard-wire cable operators nationally.
Wireless cable programming is transmitted through the air via
microwave frequencies from a transmission facility to a small receiving antenna
at each subscriber's location, which generally requires a direct, unobstructed
line-of-sight from the transmission facility to the subscriber's receiving
antenna, by utilizing up to 200 MHZ of radio spectrum allocated by the Federal
Communications Commission ("FCC") to wireless cable operators. Traditional
hard-wire cable systems also transmit signals from a transmission facility, but
deliver the signal to a subscriber's location through an extensive network of
coaxial cable and amplifiers. Because wireless cable systems do not require
such an extensive cable network, wireless cable operators such as the Company
can provide subscribers with a high quality picture and a reliable signal
resulting in fewer transmission disruptions at a significantly lower capital
cost per installed subscriber than traditional hard-wire cable systems. In
addition, operating costs of wireless cable television systems are generally
lower than those of comparable traditional hard-wire systems due to lower
network maintenance and depreciation expense.
Like traditional hard-wire operators, the Company can offer its
subscribers off-air VHF/UHF channels, as well as HBO, Showtime, Disney, ESPN,
CNN, USA, WGN, WTBS, Discovery, the Nashville Network, A&E and other
programming services. The channels that the Company offers in each market will
vary depending upon the channel rights secured in such market at the time of
system launch. In addition, the available channels in a market will typically
change as the Company continues to acquire channel rights.
BUSINESS STRATEGY
The Company's primary business objective is to develop, own and
operate wireless cable television systems in markets in which the Company
believes it can achieve positive cash flow and operating income rapidly after
system launch and then expand such system while increasing such system's
operating income.
Rural Market Focus. The Company aggregates wireless cable channel
rights and locates operations in geographic clusters of small to mid-size
markets that have a substantial number of households not currently passed by
traditional hard-wire cable. The Company believes that this size market
typically has a stable economic base, less competition than alternative forms
of entertainment and terrain and other conditions conducive to wireless cable
transmissions.
Managed Subscriber Penetration. The Company attempts to manage system
launch and subscriber growth in order to contain system launch costs and to
achieve positive cash flow rapidly. Typically, the Company's operating systems
achieve positive monthly operating cash flow upon obtaining an average of
approximately 1,200 to 1,500 subscribers. Within a system, the Company
initially directs its marketing at unpassed households, which typically have
limited access to local off-air VHF/UHF broadcast channels. Accordingly, the
Company believes it can launch service successfully in most of its markets with
only 12 channels of programming, allowing it to contain system launch costs and
achieve positive cash flow with a lower number of subscribers. Generally, once
- 4 -
<PAGE> 7
a system achieves positive operating cash flow, the Company will expand the
channel offering and add subscribers while increasing such system's positive
operating cash flow.
Low Cost Structure. Wireless cable systems typically cost
significantly less to build and operate than traditional hard-wire cable
systems for several reasons. First, while both traditional hard-wire cable
operators and wireless cable operators must construct a head-end, traditional
hard-wire cable operators must also install an extensive network of coaxial
cable and amplifiers in order to transmit signals from the head-end to
subscribers. Once the head- end is constructed, the Company estimates that
each additional wireless cable subscriber currently requires an incremental
capital expenditure by the Company of approximately $400, consisting of, on
average, $220 of material, $140 of installation labor and overhead charges and
$40 of direct commission. Such incremental capital expenditures are variable
costs and are partially offset by installation fees paid by subscribers.
Second, without an extensive cable network, wireless cable operators typically
incur lower system maintenance costs and depreciation expense. Third,
programming is generally available to traditional hard-wire and wireless cable
operators on comparable terms, although operators that have a smaller number of
subscribers often are required to pay higher per-subscriber fees. Fourth, the
Company currently experiences a low rate of subscriber turnover of on average
approximately 1.5% per month, as compared to the "churn" rate of approximately
3% per month typically experienced by traditional hard-wire cable operators.
Reduced subscriber turnover reduces installation and marketing expenses.
Finally, by locating its operations in geographic clusters, the Company can
further contain costs by taking advantage of economies of scale in management,
sales and customer service.
Acquisition of ITFS Channel Rights. Because the Company believes it
can launch service successfully in its markets with as few as 12 channels of
programming, the Company focuses on development of the 20 available ITFS
channels. The Company cooperates with many non-profit educational
organizations in obtaining ITFS licenses from the FCC. Once the Company has
secured rights to at least 12 ITFS channels in a market, the Company believes
it can launch a commercially viable system in such market. The Company
believes that its strategy of first developing the ITFS channels, in lieu of
the MDS channels, has resulted in aggregate leased license expense in its
systems in operation that is less than the industry-wide average leased license
expense.
The executive offices of the Company are located at 200 Chisholm
Place, Suite 200, Plano, Texas 75075, and the telephone number of the executive
offices is (972) 423-9494. The Company's operations are based in Durant,
Oklahoma.
USE OF PROCEEDS
The Prospectus relates to shares of Common Stock which may be offered
and issued by the Company from time to time in the acquisition of other
businesses or wireless cable channel rights and systems and collateral
arrangements associated therewith. Other than the businesses or wireless cable
channel rights or systems acquired, there will be no proceeds to the Company
from these offerings. The Company will receive none of the proceeds from any
resales of the Common Stock by the Selling Stockholders, if any.
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<PAGE> 8
RISK FACTORS
Prospective investors should carefully consider the following
information, in addition to the other information contained in this Prospectus
and any Prospectus Supplement, before purchasing shares of Common Stock offered
hereby. This Prospectus contains forward-looking statements which involve
risks and uncertainties. The Company's actual results could differ materially
from the results discussed in the forward-looking statements. Factors that
might cause such a difference include, but are not limited to, those discussed
below. See "Safe Harbor Statement Under Private Securities Litigation Reform
Act of 1995."
LIMITED OPERATING HISTORY; NET LOSSES SINCE INCEPTION
Although the Company's business commenced in 1990, it did not generate
any revenues until April 1992. Potential investors, therefore, have limited
historical information about the Company upon which to base an evaluation of
the Company's performance and a decision to invest in the Company. The Company
has recorded net losses since inception due primarily to start-up costs,
interest expense and charges for depreciation and amortization of capital
expenditures to develop its wireless cable systems. Until such time as the
Company substantially increases its subscriber base, resulting in higher
subscription fee revenues, it will continue to experience losses. Because of
the costs associated with launching a wireless cable television system and
expanding its subscriber base, continued growth by the Company will tend to
reduce net income, if any, or increase net losses. As a result, the Company
expects to continue to experience net losses while it develops and expands its
wireless cable television systems even if mature individual systems of the
Company are profitable.
SUBSTANTIAL INDEBTEDNESS OF THE COMPANY; INSUFFICIENCY OF EARNINGS TO COVER
FIXED CHARGES
The Company has a substantial amount of indebtedness. The ability of
the Company to make payments of principal and interest on its indebtedness will
be largely dependent upon its future financial performance. Many factors, some
of which will be beyond the Company's control (such as prevailing economic
conditions), will affect its financial performance. There can be no assurance
that the Company will be able to generate sufficient cash flow to cover
required interest and principal payments. If the Company is unable to meet
interest and principal payments in the future, it may, depending upon the
circumstances which then exist, seek additional equity or debt financing,
attempt to refinance its existing indebtedness or sell all or part of its
business or assets to raise funds to repay its indebtedness. There can be no
assurance that sufficient equity or debt financing will be available, or, if
available, that it will be on terms acceptable to the Company, that the Company
will be able to refinance its existing indebtedness or that sufficient funds
could be raised through asset sales. The Company's high level of indebtedness
has several important consequences, including, but not limited to: (i)
significant interest expense and principal repayment obligations resulting in
substantial annual fixed charges; (ii) significant limitations on the Company's
ability to obtain financing, make capital expenditures and acquisitions and
take advantage of other business opportunities that may arise; and (iii)
increased vulnerability to adverse general economic and industry conditions.
There can be no assurance that the Company will be profitable in the future.
MANAGEMENT OF GROWTH; INTEGRATION OF ACQUIRED BUSINESSES
The Company has experienced rapid growth in the number of its
employees and the scope of its operating and financial systems through its
continuing program of acquisitions of wireless cable television channel rights
and systems. This growth has resulted in an increased level of responsibility
for both existing and new management personnel. To manage its growth
effectively, the Company will be required to implement and improve its
operating and financial systems and controls and to expand, train and manage
its employee base. Although the Company has historically retained the services
of certain persons formerly employed by certain acquired businesses and
anticipates retaining qualified employees of future acquisitions, the Company
has been, and expects to continue to be primarily dependent upon the existing
management of the Company to perform the management functions formerly
performed by management of each of the acquired businesses. To the extent that
the Company's existing management is unable to assume or perform these combined
duties, the Company could be adversely affected. There can be no assurance that
the management, systems and controls currently in place or any steps taken to
improve such management, systems and controls will be adequate in the future.
- 6 -
<PAGE> 9
As a result of its rapid growth, management of the Company must make
and implement a number of strategic and operational decisions regarding the
integration of its various operations and the exploitation of its assets and
businesses. The timing and manner of the implementation of decisions made with
respect to the ongoing business of the Company will materially affect the
operations of the Company. There can also be no assurance that any acquired
businesses will be integrated successfully into the Company's business.
NEED FOR ADDITIONAL FINANCING FOR GROWTH
The growth of the Company's business requires substantial investment
on a continuing basis to finance capital expenditures and expenses related to
subscriber growth and system development. The Company believes that its cash
and cash equivalent assets and cash generated from operations will be
sufficient to fund the Company's operations and expansion through approximately
the end of 1996. Additional funds will be necessary to complete the launch,
build-out and expansion of all of the Company's wireless cable systems and to
bring such systems to a mature state. These activities may be financed in
whole or in part directly by the Company and/or by its existing or future
subsidiaries, through debt or equity financings, joint ventures or other
arrangements. As in the past, the Company may also finance its system
construction, development, launch and expansion activities or the acquisition
of additional markets through the sale and/or exchange of its existing
portfolio of wireless cable channel rights. Although the Company believes that
cash provided by operating activities, the sale of wireless cable channel
rights that are not a part of the Company's current strategic plan and proceeds
from additional public or private debt or equity offerings will be sufficient
for the Company to complete its planned system construction, development,
launch and expansion activities in 1997 and beyond, there can be no assurance
that the Company will achieve positive cash flow from operations, that the
Company will consummate the sale of any wireless cable channel rights or that
sufficient debt or equity financing will be available on satisfactory terms and
conditions, if at all. In addition, there is also no assurance that the
acquisition opportunities sought by the Company will not utilize the capital
currently expected to be available for the Company's current markets. The
amount and timing of the Company's future capital requirements will depend upon
a number of factors, including programming costs, equipment costs, marketing
expenses, staffing levels, subscriber growth and competitive conditions, many
of which are not within the Company's control. Failure to obtain any required
additional financing could materially adversely affect the growth, cash flow or
earnings of the Company.
POTENTIAL SIGNIFICANT INDUSTRY TRANSACTIONS
Significant industry transactions such as acquisitions and
dispositions of channel rights, joint ventures and other business transactions
between and among participants in the wireless cable television industry have
occurred with some frequency in the past, and the Company's management expects
this trend to continue in the foreseeable future. Although the Company
regularly engages in discussions concerning such industry transactions with
other industry participants, the Company is not currently subject to any
material definitive agreements in such regard except to the extent described in
the documents incorporated herein by reference and/or any amendment or
supplement to this Prospectus, if any. Whether the Company ultimately
negotiates and/or consummates any significant industry transactions will
depend, among other things, upon the business and prospects of the Company,
industry conditions, investment and growth opportunities available to the
Company, stock market conditions, availability and suitability of financing for
such transactions, regulatory and legal considerations and other plans and
requirements of the Company. No assurance can be given that, if consummated,
any such significant industry transactions could be successfully integrated
into the Company's business.
DEPENDENCE ON EXISTING MANAGEMENT; KEY EMPLOYEES
The Company is dependent in large part on the experience and knowledge
of existing management. The Company has not entered into any employment
agreements with, or obtained key-man life insurance for, any of its executive
officers and there can be no assurance that any of such persons will remain in
the Company's employ in the future. The Company's success is also dependent
upon its ability to attract and retain qualified employees to develop and
operate its wireless cable systems.
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COMPETITION
The subscription television industry is highly competitive. Wireless
cable television systems face or may face competition from several sources,
such as traditional hard-wire cable companies, Satellite Master Antenna
Television systems, Direct Broadcast Satellites and other alternative methods
of distributing and receiving television transmissions. Further, premium movie
services offered by cable television systems have encountered significant
competition from the home video cassette recorder industry. In areas where
several local off-air VHF/UHF broadcast signals can be received without the
benefit of subscription television, cable television systems also have
experienced competition from the availability of broadcast signals generally
and have found market penetration to be more difficult. In addition, within
each market, the Company initially must compete with others to acquire, from
the limited number of channel licenses issued, rights to a minimum number of
channels needed to establish a viable system. Legislative, regulatory and
technological developments may result in additional and significant
competition, including competition from local telephone companies, from a
proposed new wireless service known as local multi-point distribution and from
emerging trends and technologies. The Company has targeted its marketing to
households that are unpassed by traditional hard-wire cable and that have
limited access to local off-air VHF/UHF broadcast channels. Accordingly, the
Company has not encountered significant direct competition from traditional
hard-wire cable companies. It is likely, however, that the Company will face
significant direct competition from traditional hard-wire cable companies in
the future. In addition, as the telecommunications industry continues to
evolve, the Company may face additional competition from new providers of
entertainment and data services. In particular, there are a rapidly growing
number of information and data service providers serving consumers via informal
communications networks, such as the Internet and World Wide Web. Although the
Company is unaware of any such provider delivering programming like that
available over wireless cable television, there can be no assurance that
continuing advances in technology will not make such delivery possible. Even if
such direct competition does not exist in the future, however, the Company's
services will compete, indirectly, with entertainment services generally,
including those provided by operators using evolving technology. Many actual
and potential competitors have greater financial, marketing and other resources
than the Company. No assurance can be given that the Company will compete
successfully in any or all of its markets.
GOVERNMENT REGULATION
The right to transmit on wireless cable channels is regulated by the
FCC and the copyright for the retransmission of local off-air VHF/UHF
broadcasts is regulated by the United States Copyright Office pursuant to the
Copyright Act of 1976, as amended (the "Copyright Act").
Federal Legislation. Pursuant to the Cable Television Consumer
Protection and Competition Act of 1992, as amended (the "Cable Act"), the FCC
adopted rate regulations exclusively for traditional hard-wire cable systems.
Pursuant to the Telecommunications Act of 1996, which was enacted in February
1996, all cable rate regulation for cable program service tiers will be
eliminated after three years, and for "small systems" as defined in such Act,
and under certain other circumstances, rate regulation will be eliminated
immediately. The Company cannot predict precisely what effect these regulations
or other governmental regulations may have on traditional hard-wire cable
operators as to price and service. While current FCC regulations are intended
to promote the development of a competitive pay television industry, the rules
and regulations affecting the wireless cable industry may change, and any
future changes in FCC rules, regulations, policies and procedures could have an
adverse effect on the industry as a whole and on the Company in particular.
Copyright Act. Secondary transmission of a broadcast signal is
permissible only if approved by the copyright holder or if subject to
compulsory licensing under the Copyright Act. The United States Congress
adopted legislation extending the compulsory copyright licensing system to
include wireless cable systems. As a result of this action, wireless cable
operators may engage in secondary transmissions of broadcast programming
without the copyright holder's approval, provided that such operators file
certain reports and pay certain fees set by copyright arbitration royalty
panels.
Regulation of Retransmission. Effective October 6, 1993, pursuant to
the Cable Act, broadcasters (other than superstations) may require that cable
operators obtain their consent before retransmitting off-air VHF/UHF
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<PAGE> 11
broadcasts. The FCC has exempted wireless cable operators from the
retransmission consent rules if the receive-site antenna is either owned by the
subscriber or within the subscriber's control and available for purchase by the
subscriber upon the termination of service. In all other cases, wireless cable
operators must obtain consent to retransmit broadcast signals. The Company has
obtained such consents in each of the systems where the Company is
retransmitting on a wireless cable channel. Such consents will be required in
the Company's other markets. There can be no assurance that the Company will be
able to obtain such consents on terms satisfactory to the Company.
Other Regulations. Wireless cable operators are also subject to
regulation by the Federal Aviation Administration (the "FAA") with respect to
the construction of transmission towers and to certain local zoning regulations
affecting construction of towers and other facilities. There may also be
restrictions imposed by local authorities. There can be no assurance that the
Company will not be required to incur additional costs in complying with such
regulations and restrictions. No assurance can be given that new regulations
will not be imposed or that existing regulations will not be changed. Any such
new or modified regulations could have a material adverse effect on the
wireless cable industry as a whole and on the Company in particular.
DEPENDENCE ON CHANNEL LEASES; LOSS OF LICENSES BY LESSORS
The Company is dependent on leases with unaffiliated third parties for
most of its wireless cable channel rights. The Company has entered into leases
for substantially all of its wireless cable channel rights with channel license
holders, applicants for channel licenses and applicants that have had
previously-filed applications returned without prejudice by the FCC and which
will be refiled. The Company's channel leases typically cover four
instructional television fixed service ("ITFS") and/or one to four multi-point
distribution service ("MDS") wireless cable channels each. Generally, ITFS
channels may only be owned by qualified non-profit educational organizations
and in general must use a minimum of 20 hours per week per channel for
educational programming. In addition, the FCC's Rules require an ITFS licensee
to reserve an additional 20 hours per channel per week for recapture time,
which may or may not ever be used or recaptured by the licensee. The remaining
excess ITFS channel air time may be leased to wireless cable operators for
commercial use without further restriction. MDS channels may be owned by
commercial entities and allow full-time usage without programming restrictions.
Under the rules of the FCC, the term of an ITFS channel lease cannot exceed ten
years. There is no such restriction for MDS channel leases. ITFS licenses
generally are granted for a term of ten years and are subject to the renewal by
the FCC. MDS licenses issued prior to mid-1996 generally will expire on May 1,
2001 unless renewed. The use of such channels by the license holders is subject
to regulation by the FCC, and the Company's ability to continue to enjoy the
benefits of its leases with channel license holders is dependent upon the
continuing compliance by the channel license holders with applicable
regulations including the requirement that ITFS license holders must meet
certain educational use requirements in order to lease transmission capacity to
wireless cable operators. The remaining initial terms of most of the Company's
channel leases are approximately 5 to 10 years. Most of the Company's leases
grant the Company a right of first refusal to renew the lease or to purchase
the channels after the expiration of the lease if FCC rules and regulations so
permit, provide for automatic renewal of the lease term upon FCC renewal of the
license if such automatic renewals are permissible at the time, and/or require
the parties to negotiate lease renewals in good faith. The termination of or
failure to renew a channel lease or termination of the channel license, or the
failure to grant an application for an extension of time to construct an
authorized station, would result in the Company being unable to deliver
television programming on such channel(s). Although the Company does not
believe that the termination of or failure to renew a single channel lease or
license would adversely affect the Company, several of such terminations or
failures in one or more markets that the Company actively serves could have a
material adverse effect on the Company. Additionally, FCC licenses also specify
construction deadlines, which, if not met, could result in the loss of the
license. Requests for additional time to construct may be filed and are subject
to review pursuant to FCC rules. Certain of the Company's channel rights are
subject to pending extension requests and it is anticipated that additional
extensions will be required. There can be no assurance that the FCC will grant
any particular extension request or license renewal request. There can be no
assurance that the FCC will not change its current policies regarding such
extension applications to require a greater showing or limit the number of
extensions that one license holder may request.
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UNCERTAINTY OF GRANT OF PENDING APPLICATIONS
Applications for wireless cable licenses are subject to approval by
the FCC. Applicants with whom the Company has entered into leases have filed a
series of applications with the FCC for a number of wireless cable channels and
the Company has entered into leases for additional channels with applicants
that have had previously-filed applications returned without prejudice by the
FCC and which have been refiled. The vast majority of such leases are in the
form of lease agreements with qualified non-profit educational organizations
for ITFS channels. ITFS applications undergo review by the FCC's engineers and
staff attorneys and there is no limit on the time that may elapse between
filing the application with the FCC for a modification or new license and
action thereon by the FCC. Further, there can be no assurance that the FCC
will approve any such pending applications. Once the FCC staff determines that
the applications meet certain basic technical and legal qualifications, the
staff will then determine whether each application is proximate to the transmit
and receive-site locations of other applications. Those applications that would
result in signal interference to other pending applications ("Competing
Applications") must then undergo a comparative selection process set forth in
detail in the FCC's Rules. The FCC's ITFS application selection process is
based upon and awards points for each of a set of objective criteria receive
that includes whether an applicant is located in the community to be served and
the number of students that will receive the applicant's educational
programming. Thus, the outcome of the selection process when two or more
qualified applicants are competing for the same channels lends itself to a
degree of predictability that varies according to the circumstances. Most of
the Company's lease agreements with applicants for channel licenses involve
channel licenses for which Competing Applications have been filed. In each
market, the Company has carefully considered the FCC's selection criteria in
choosing the educational entities with which it has entered into lease
agreements. However, because the FCC's application review process does not lend
itself to complete certainty, and given the considerable number of applications
involved, no assurance can be given as to the precise number of applications
that will be granted. A number of competing applicants for channel licenses
have filed with the FCC petitions to deny the applications in which the Company
has acquired channel rights, based upon alleged substantive defects in the
applicant or in technical or other aspects of the application. The Company
anticipates that the FCC will deny most of the current petitions to deny the
applications in which the Company has acquired channel rights. However, no
assurance can be given as to the precise number of such petitions that will be
denied. Although the Company does not believe that any single award of a
channel license to an applicant that has filed a Competing Application or the
granting of any single petition to deny an application in which the Company has
acquired channel rights would adversely affect the Company, several of such
awards or grants could have a material adverse effect on the Company.
UNCERTAINTY OF ABILITY TO OBTAIN FCC AUTHORIZATIONS
Wireless cable systems transmit programming over wireless cable
channels that are licensed by the FCC. Generally, the Company believes that a
minimum of 12 wireless cable channels are necessary to offer a commercially
viable wireless cable system in most rural markets and that more channels are
required in more competitive markets, such as those well served by traditional
cable television systems. In some of its long-term launch markets, the Company
does not currently have the right to operate 12 channels from the same
transmitter site. In those markets, the Company is dependent upon (i) the grant
of pending applications for modification of existing licenses for unbuilt ITFS
stations, (ii) the grant of such license modification applications which have
not been filed and/or (iii) the grant of applications for new ITFS licenses,
some of which have not been filed. There can be no assurance that any or all of
the modification applications and new license applications actually made or
anticipated to be made by the Company will be granted by the FCC. Although the
Company does not believe that the denial of any single modification or new
license application will adversely affect the Company, the denial of several
such applications, particularly if concentrated in one or a few of the
Company's markets, could have a material adverse effect on its growth.
INTERFERENCE ISSUES
Under current FCC regulations, a wireless cable operator may install
receive-site equipment and serve any point where its signal can be received,
subject to the interference protection rights of certain other wireless cable
systems. Interference from other wireless cable systems can limit the ability
of a wireless cable system to serve particular points, in the same manner that
interference from one television station limits the ability of a viewer to
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<PAGE> 13
receive another television station broadcasting on the same frequency. In
licensing ITFS and MDS stations, a primary concern of the FCC is avoiding
situations where proposed stations are predicted to cause interference to the
reception of existing station signals. Pursuant to current FCC regulations, a
wireless cable license holder is generally protected from interference within a
35 mile radius of the transmission site. In September 1995, the protected
service area of MDS stations became fixed and will not change if a licensee
modifies its facilities to a new transmission location. The Company's business
plan involves moving the authorized transmitter site of various of its MDS and
ITFS licensed stations and obtaining the grant of licenses to new stations that
the Company will use in its wireless cable systems. The FCC interference
protection standards may make one or more of those proposed relocations or new
grants unavailable. In any such event, it may be necessary to negotiate
interference agreements with the licensees of stations which would otherwise
block such relocations or new grants. There can be no assurance that the
Company will be able to negotiate any required interference agreements on terms
acceptable to it. In the event that the Company cannot obtain interference
agreements required to implement its plans for a given market, the Company may
have to curtail or modify operations in that market. Any substantial
modification or curtailment of the Company's operations in its markets could
have a material adverse effect on its growth or financial performance. In
addition, while the Company's leases with MDS and ITFS licensees require their
cooperation, it is possible that one or more of the Company's channel lessors
may hinder or delay the Company's efforts to use the channels in accordance
with its plans for a particular market.
DEPENDENCE ON PROGRAM MATERIAL AGREEMENTS
In connection with its distribution of television programming, the
Company is dependent on fixed-term contracts with various program suppliers.
Generally, the terms of such contracts are for periods of one to five years and
began to expire in 1996. Although the Company has no reason to believe that
any such contracts will be cancelled or will not be renewed upon expiration, if
such contracts are cancelled or not renewed, the Company will have to seek
program material from other sources. There is no assurance that other program
material will be available to the Company on acceptable terms or at all or, if
so available, that such material will be acceptable to the Company's
subscribers. The likelihood that program material will be unavailable to the
Company is significantly mitigated by the Cable Act and various FCC regulations
issued thereunder, which, among other things, impose limits on exclusive
programming contracts and generally prohibit cable programmers in which a cable
operator has an attributable interest from discriminating against cable
competitors with respect to the price and terms and conditions of sale of
programming. Only a few of the major cable television programming services
carried by the Company are not currently directly owned by a vertically
integrated cable operator, and the Company historically has not had difficulty
in arranging satisfactory contracts for these services. The Cable Act is the
subject of various legal challenges and if it were found to be
unconstitutional, program suppliers might raise their prices or make their
program material unavailable to the Company.
PHYSICAL LIMITATIONS OF WIRELESS CABLE TRANSMISSION
Wireless cable programming is transmitted via microwave frequencies
from a transmission facility to a small receiving antenna at each subscriber's
location, which generally requires a direct, unobstructed line-of-sight from
the transmission facility to the subscriber's receiving antenna. Therefore, in
communities with tall trees, hilly terrain, tall buildings or other
obstructions in the transmission path, wireless cable transmission can be
difficult or impossible to receive at certain locations without the use of
signal boosters. Consequently, the Company may not be able to supply services
to certain potential subscribers. In addition, in limited circumstances,
extremely adverse weather can damage transmission and receiving antennas as
well as transmit site equipment.
DIFFICULTIES AND UNCERTAINTIES OF A NEW INDUSTRY
While wireless cable television is not a new technology, it is a
relatively new industry with a short operating history. Potential investors
should be aware of the difficulties and uncertainties that are normally
associated with new industries, such as lack of consumer acceptance, difficulty
in obtaining financing, increasing competition, advances in technology and
changes in laws and regulations. There can be no assurance that the wireless
cable industry will develop or continue as a viable or profitable industry.
POSSIBLE ADVERSE TAX CONSEQUENCES ATTRIBUTABLE TO CERTAIN DISPOSITIONS
To the extent the Company and/or its subsidiaries receive cash and/or
promissory notes upon the consummation of the sale or disposition of certain
assets held for sale, such transaction will result in the recognition of gain
for Federal income tax purposes. The amount of any tax liability attributable
thereto will depend upon numerous factors, including the tax basis of the
assets conveyed, the net operating losses available to the Company and other
factors. There can be no assurance that sufficient tax bases and net operating
losses will exist to defray a material amount of any such gain, thereby
requiring the Company to pay certain tax liabilities to Federal and/or state
authorities. Any such payments would negatively impact the Company's cash flow.
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<PAGE> 14
CERTAIN SUBSIDIARIES NOT WHOLLY-OWNED
The Company generally conducts its business through subsidiaries. The
Company's subsidiaries include non-operating subsidiaries that hold interests
in channels, subsidiaries that operate systems and subsidiaries that do both.
The Company also has an operating subsidiary that installs wireless cable
systems in various markets served by the Company and its subsidiaries. Certain
of the Company's subsidiaries are not wholly-owned and most subsidiaries are
indirectly owned by the Company as a result of its majority ownership of other
entities. Although the Company has a sufficient interest in its subsidiaries to
be able to exercise control over them, the Company may owe a fiduciary duty to
the holders of various minority interests in its subsidiaries. Accordingly, the
Company may not exercise unfettered control over such subsidiaries and may be
required to deal with such subsidiaries on terms no less favorable to such
subsidiaries than could be obtained from unaffiliated third parties. The
Company believes that all of its dealings with its subsidiaries have been on
such terms. In addition, dividends or other distributions paid or made by such
subsidiaries must be paid or made on a pro rata basis to all stockholders.
WIRELESS ONE AND CS WIRELESS MINORITY INVESTMENTS
The Company owns approximately 21% of the outstanding common stock of
Wireless One, Inc., a Delaware corporation ("Wireless One") and 35% of the
outstanding common stock of CS Wireless. Although David E. Webb and J. R.
Holland, Jr., directors of the Company, serve as directors of each of Wireless
One and CS Wireless, the Company cannot exercise unfettered control over these
substantial investments. The Company does not control the management of either
of Wireless One or CS Wireless, and is dependent upon the skill, expertise and
managerial efforts of their respective management teams to achieve a return on
the Company's substantial investment. To the extent Wireless One or CS
Wireless proves unsuccessful in its business, the value of the Company's
investment therein will be adversely affected.
AGREEMENT TO VOTE FOR BOARD DESIGNEE OF JUPITER; CO-SALE RIGHT
David E. Webb, the President and Chief Executive Officer of the
Company, L. Allen Wheeler, Vice Chairman and a member of the Board of Directors
of the Company and Hunt Capital Group, L.L.C. ("Hunt Capital"), a principal
stockholder of the Company and affiliate of J. R. Holland, Jr., the Chairman of
the Board of the Company, collectively own approximately 40.6% of the
outstanding Common Stock. Pursuant to the terms of a Stockholders' Agreement
(the "Stockholders' Agreement"), entered into in connection with the private
placement of $40.2 million of 9% Convertible Subordinated Discount Notes due
2004 (the "Convertible Notes"), for so long as Jupiter Partners, L.P.
("Jupiter"), the purchaser of $40 million of the Convertible Notes, retains a
25% interest in the Convertible Notes originally purchased by it and/or the
shares of Common Stock issued or issuable upon conversion thereof (the
"Conversion Shares") originally issuable to it, each of Hunt Capital, David E.
Webb and L. Allen Wheeler, have agreed to vote their shares (i) in favor of the
election to the Company's Board of Directors of one designee of Jupiter, and
(ii) in favor of the Company's Board of Directors consisting of at least three
and not more than seven members. The agreement of such stockholders to elect
Jupiter's designee to the Board of Directors may restrict the ability of such
stockholders to elect their preferred slate of directors to manage the Company,
which may result in a member of the Board of Directors having interests that
conflict with those of the other stockholders of the Company. In addition,
under the terms of the Stockholders' Agreement, each of Hunt Capital, David E.
Webb and L. Allen Wheeler have agreed that, for so long as Jupiter holds such
25% interest, in the event of any proposed sale or series of sales of Common
Stock by any such stockholder to a non-affiliate for aggregate consideration
greater than $15 million or representing in excess of 5% of the then
outstanding shares of Common Stock at such time, such stockholder shall not
effect such sale unless Jupiter is permitted to participate in such sale on a
pro rata basis with such stockholder. The co-sale right may reduce the
likelihood of a change in control of the Company because any potential
purchaser of stock held by the controlling stockholders may also be required to
purchase shares owned by Jupiter.
FUTURE ACQUISITIONS
The Company anticipates that it will continue to acquire additional
channel rights and systems, both in its existing markets and in other markets,
both directly and indirectly by acquiring other wireless cable television
providers. Such acquisitions may be in geographic areas or markets outside of
the Company's traditional focus of
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<PAGE> 15
small to mid-size markets principally in the central United States. In
addition, it is possible that the Company might make one or more acquisitions
outside of the business of providing wireless cable television services. Any
such acquisitions may be made for Common Stock, cash, notes or other evidences
of indebtedness, property or a combination thereof. Under applicable law and
regulations, in many circumstances, approval by the Company's stockholders of
any such acquisitions may not be required. The issuance of Common Stock to
effect or finance such acquisitions would have the effect of reducing the
percentage ownership of the Company held by each pre-acquisition stockholder
and the incurrence of indebtedness in connection with such acquisitions could
adversely affect the liquidity, results of operations and financial condition
of the Company.
LIMITED TRADING VOLUME AND POSSIBLE VOLATILITY OF THE COMMON STOCK
The average trading volume of shares of Common Stock on Nasdaq
National Market has been limited. The market price of the Common Stock could
fluctuate substantially in the future for a variety of reasons, including the
anticipated increased trading volume and anticipated dispositions, the
performance of the Company, investor expectations for the Company and the
wireless cable television industry, general economic conditions and
fluctuations in the overall stock market.
NO COMMON STOCK DIVIDENDS
The Company has not paid dividends on the Common Stock since its
inception and does not anticipate paying any dividends in the foreseeable
future. In addition, provisions relating to the Company's indebtedness prohibit
the payment or accrual of dividends or any other distribution with respect to
the Common Stock until such debt is paid in full.
OFFERED SECURITIES
This Prospectus relates to up to 1,250,000 shares of Common Stock that
the Company proposes to issue from time to time in its continuing program of
acquisitions of wireless cable television channel rights and systems. The
Company may acquire these systems either directly or indirectly through its
subsidiaries.
The Company continually evaluates and negotiates with potential
acquisition candidates which may or may not, at specific points in time, be
material, in the aggregate or individually, to the Company. The Company
anticipates that such acquisitions may consist primarily of additional wireless
cable television channel rights and systems in small to mid-size markets
located principally in central United States. If the opportunity arises,
however, the Company may attempt to consummate transactions which are either
complementary to its present business or which the Company considers
advantageous even though they may be dissimilar to the Company's present
activities. The consideration for such acquisitions, including consideration
issued under any collateral arrangements, such as management, employment,
consulting or non-competition agreements, may consist of Common Stock, cash,
notes or other evidences of indebtedness, property, exchange of assets,
assumptions of liabilities, or a combination thereof, as may be determined from
time to time by negotiations between representatives of the Company and the
owners of the businesses or wireless cable channel rights or systems to be
acquired. The number of shares of Common Stock that may be issued in any
particular acquisition will be determined by such negotiations and after
consideration by the Company of certain factors.
The shares covered by this Prospectus may be issued in exchange for
shares of capital stock, partnership interests or other assets representing an
interest, direct or indirect, in other companies or other entities, in exchange
for assets used in or related to the business of such entities or otherwise
pursuant to the agreements providing for such acquisitions. Generally, the
terms of the acquisitions will be determined by direct negotiations between the
representatives of the Company and the owners of the business or wireless cable
channel rights or system to be acquired or, in the case of entities more widely
held, through exchange offers to stockholders or documents soliciting approval
of statutory mergers, consolidations or sales of assets. The Company considers
several factors when assessing a potential acquisition including, but not
limited to, the value placed by the parties on the assets to be acquired, the
number of subscribers, the cash flow anticipated by the target, growth
potential, location of the channel rights or systems to be acquired, regulatory
matters, the current and potential future market value of the
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<PAGE> 16
Common Stock being offered and the tax treatment of the proposed acquisition.
The Company anticipates that shares of Common Stock issued in any such
acquisition will be valued at a price reasonably related to the current market
value of the Common Stock, either at the time the terms of the acquisition are
tentatively agreed upon, at or about the time of closing or during a specified
period or periods prior to delivery of the shares. Underwriting discounts or
commission will generally not be paid by the Company.
As of the date of initial effectiveness of the Registration Statement
to which this Prospectus forms a part, the Company is not a party to any
binding commitments or agreements to proceed with regard to any acquisitions
except to the extent described in the documents incorporated herein by
reference and/or any amendment or supplement to this Prospectus, if any.
Nonetheless, the Company intends to actively pursue future acquisition
opportunities. At the time a particular acquisition candidate is identified,
the Company will, to the extent required, update this Prospectus to include
information about the specific transaction, the particular company being
acquired and updated information about the Company, by means of a
post-effective amendment; provided, however, that where the transaction in
which the securities are being offered would itself qualify for an exemption
from Section 5 of the Securities Act, absent the existence of other similar
(prior or subsequent) transactions, a Prospectus Supplement may be used to
furnish the information necessary in connection with such transaction.
RESALES AND PLAN OF DISTRIBUTION
This Prospectus, as amended or supplemented, may also be used by the
persons who receive shares of Common Stock issued by the Company in
acquisitions, and who wish to offer and sell such Common Stock, on terms then
available, in transactions in which they may be deemed affiliates or
underwriters within the meaning of the Securities Act (the "Selling
Stockholders"); provided, however, that no Selling Stockholder will be
authorized to use this Prospectus for any offer of such Common Stock without
first obtaining written consent of the Company. The Company may consent to the
use of this Prospectus by Selling Stockholders for a limited period of time and
subject to conditions and limitations which may vary as to any given Selling
Stockholder. Profits realized on resales by Selling Stockholders under certain
circumstances may be regarded as underwriting compensation under the Securities
Act.
Resales may be made pursuant to this Prospectus, as amended or
supplemented, pursuant to Rule 145(d) under the Securities Act or pursuant to
an exemption from the Securities Act. Resales by Selling Stockholders may be
made directly to investors or through a securities firm, acting as an
underwriter, broker or dealer. When resales are to be made through a
securities firm, such securities firm may be engaged to act as the Selling
Stockholder's agent in the sale of shares by such Selling Stockholders, or such
securities firm may purchase shares from the Selling Stockholders as principal
and thereafter resell such shares from time to time. The fees earned by or
paid to such securities firm may be the normal stock exchange commission or
negotiated commissions or underwriting discounts to the extent permissible. In
addition, such securities firm may effect resales through other securities
dealers, and customary commissions or concessions to such other dealers may be
allowed. Sales of shares may be at negotiated prices, at fixed prices, at
market prices or at prices related to market prices then prevailing. Any such
sales may be made on the Nasdaq National Market or other exchange on which such
shares are traded, in the over-the-counter market, by block trade, in special
or other offerings, directly to investors or through a securities firm acting
as agent or principal or a combination of such methods. Any participating
securities firm may be indemnified against certain civil liabilities, including
liabilities under the Securities Act. The Selling Stockholders and any
participating securities firm may be deemed to be an "underwriter" within the
meaning of the Securities Act, and any profit and any commissions earned or any
discounts or concessions allowed to such firm may be deemed to be underwriting
discounts or commissions under the Securities Act.
A Prospectus Supplement, if required, will be filed under Rule 424(b)
under the Securities Act, disclosing the name of the Selling Stockholder, the
participating securities firm, if any, the number of shares involved, and other
details of such resale, if appropriate.
All expenses of registration incurred in connection with the offering
of the Common Stock made hereby are and will be borne by the Company, but all
brokerage commissions and other similar expenses incurred by the Selling
Stockholders will be borne by the Selling Stockholders.
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<PAGE> 17
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon
for the Company by Arter & Hadden, Dallas, Texas.
EXPERTS
The consolidated financial statements and schedule of Heartland
Wireless Communications, Inc. as of December 31, 1995 and 1994, and for each of
the years in the three-year period ended December 31, 1995, have been
incorporated by reference herein and in the Registration Statement in reliance
upon the report of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing. The report of KPMG Peat Marwick LLP
refers to a change in 1995 by the Company in the method of accounting for the
direct costs and installation fees related to subscriber installations.
The financial statements of Technivision, Inc. as of May 31, 1995 and
1994, and for each of the years in the three-year period ended May 31, 1995,
have been incorporated by reference herein and in the Registration Statement in
reliance upon the report of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing. The report of KPMG Peat Marwick LLP
contains an explanatory paragraph that states that the Technivision, Inc.'s
recurring losses from operations and excess of current liabilities over current
assets raise substantial doubt about the entity's ability to continue as a
going concern. The financial statements do not include any adjustments that
might result from the outcome of that uncertainty.
The balance sheets of Cross Country Division as of December 31, 1993
and 1994, and the related statements of operations and division equity and cash
flows for the year ended December 31, 1993, the period from January 1, 1994 to
August 18, 1994 and the period from August 19, 1994 to December 31, 1994 have
been incorporated by reference herein and in the Registration Statement in
reliance upon the report of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing. The report of KPMG Peat Marwick LLP
contains an explanatory paragraph that refers to a business combination in 1994
accounted for as a purchase involving assets comprising a portion of Cross
Country Division. As a result of the acquisition, financial information of
Cross Country Division for periods after August 18, 1994 is presented on a
different cost basis than that for periods before August 18, 1994 and,
therefore, such information is not comparable.
The consolidated balance sheets as of June 30, 1994 and 1995 and the
consolidated statements of operations, stockholders' equity and cash flows of
CableMaxx, Inc. for the period from December 18, 1992 to June 30, 1993 and the
fiscal years ended June 30, 1994 and 1995, and the consolidated statements of
operations and cash flows of Supreme Cable Co., Inc. and its subsidiaries (the
"Predecessor") for the period commencing July 1, 1992 to December 17, 1992,
incorporated by reference in this Prospectus have been audited by Coopers &
Lybrand L.L.P., independent certified public accountants, as indicated in their
report with respect thereto, which includes an explanatory paragraph which
states that specified circumstances raise substantial doubt about CableMaxx,
Inc.'s ability to continue as a going concern, and are included herein in
reliance upon the authority of said firm as experts in accounting and auditing.
The financial statements of American Wireless Systems, Inc.
incorporated by reference in this Prospectus have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their report with
respect thereto, and are incorporated by reference herein in reliance upon the
authority of said firm as experts in accounting and auditing in giving said
report. Reference is made to said report which includes an explanatory
paragraph that describes factors raising substantial doubt about the Company's
ability to continue as a going concern.
The consolidated financial statements of Fort Worth Wireless Cable
T.V. Associates incorporated by reference in this Prospectus have been audited
by Arthur Andersen LLP, independent public accountants, as indicated in their
report with respect thereto, and are incorporated by reference herein in
reliance upon the authority
- 15 -
<PAGE> 18
of said firm as experts in giving said report. Reference is made to said report
which includes an explanatory paragraph that describes factors raising
substantial doubt about the Company's ability to continue as a going concern.
The consolidated financial statements of Wireless Cable TV Associates
#38 incorporated by reference in this Prospectus have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their report with
respect thereto, and are incorporated by reference herein in reliance upon the
authority of said firm as experts in giving said report. Reference is made to
said report which includes an explanatory paragraph that describes factors
rasing substantial doubt about the Company's ability to continue as a going
concern.
- 16 -
<PAGE> 19
================================================================================
NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS, AND, IF GIVEN
OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY, THE SELLING STOCKHOLDERS OR ANY OTHER PERSON.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF ANY
OFFER TO BUY ANY SECURITY OTHER THAN SHARES OF COMMON STOCK OFFERED BY THIS
PROSPECTUS, NOR DOES IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY
OFFER TO BUY SHARES OF COMMON STOCK BY ANYONE IN ANY JURISDICTION IN WHICH SUCH
OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH
OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE
ANY IMPLICATION THAT INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO THE DATE HEREOF.
-------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information 2
Incorporation of Certain Documents
by Reference 2
Safe Harbor Statement under the
Private Securities Litigation
Reform Act of 1995 3
The Company 4
Use of Proceeds 5
Risk Factors 6
Offered Securities 13
Resales and Plan of Distribution 14
Legal Matters 15
Experts 15
</TABLE>
================================================================================
================================================================================
1,250,000 SHARES
HEARTLAND WIRELESS
COMMUNICATIONS, INC.
COMMON STOCK
PROSPECTUS
OCTOBER __, 1996
================================================================================
<PAGE> 20
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Pursuant to Section 102(b)(7) of the Delaware General Corporation Law
(the "DGCL"), Article VI of the Registrant's Restated Certificate of
Incorporation (the "Certificate of Incorporation") eliminates the liability of
the Registrant's directors to the Registrant or its stockholders, except for
liabilities related to breach of duty of loyalty, actions not in good faith and
certain other liabilities.
Section 145 of the DGCL provides for indemnification by the Registrant
of its directors and officers. In addition, Article IX, Section 1 of the
Registrant's Restated Bylaws requires the Registrant to indemnify any current
or former director or officer to the fullest extent permitted by the DGCL. In
addition, the Registrant has entered into indemnity agreements with its
directors, which obligate the Registrant to indemnify such directors to the
fullest extent permitted by the DGCL. The Registrant has also obtained
officers' and directors' liability insurance which insures against liabilities
that officers and directors of the Registrant may incur in such capacities.
ITEM 21. EXHIBITS.
(A) EXHIBITS
Exhibit
No. Description of Exhibit
- ------- ----------------------
2.1 Letter Agreement regarding formation of the Registrant (filed as
Exhibit 2.1 to the Registrant's Registration Statement on Form S-1,
File No. 33-74244 (the "Form S-1") and incorporated herein by
reference)
2.2 Supplement to Letter Agreement regarding formation of the Registrant
(filed as Exhibit 2.2 to the Form S-1 and incorporated herein by
reference)
2.3 Asset Purchase Agreement among RuralVision Joint Venture, RuralVision
Central, Inc. and RuralVision South, Inc. (filed as Exhibit 2.3 to
the Registrant's Registration Statement on Form S-1, File No. 33-84408
(the "November Form S-1") and incorporated herein by reference)
2.4 Supplemental Agreement to the Asset Purchase Agreement among
RuralVision Joint Venture, RuralVision Central, Inc. and RuralVision
South, Inc. (filed as Exhibit 2.4 to the November Form S-1 and
incorporated herein by reference)
2.5 Closing Agreement amending the Supplemental Agreement among
RuralVision Joint Venture, RuralVision Central, Inc. and RuralVision
South, Inc. (filed as Exhibit 2.5 to the November Form S-1 and
incorporated herein by reference)
2.6 Asset Purchase Agreement between RuralVision Joint Venture and Cable
Equity Partners, Inc. (filed as Exhibit 2.6 to the November Form S-1
and incorporated herein by reference)
2.7 Letter Agreement amending Asset Purchase Agreement between RuralVision
Joint Venture and Cable Equity Partners, Inc. (filed as Exhibit 2.7 to
the November Form S-1 and incorporated herein by reference)
2.8 Letter Agreement between the Registrant and Cross Country Wireless,
Inc. (filed as Exhibit 2.8 to the November Form S-1 and incorporated
herein by reference)
2.9 Letter Agreement between the Registrant and Cable Equity Partners,
Inc. (filed as Exhibit 2.9 to the Registrant's Registration Statement
on Form S-4, File No. 33-87076 (the "February 1995 Form S-4") and
incorporated herein by reference)
II-1
<PAGE> 21
2.10 Lease Purchase Agreement between the Registrant and Choice Television
of Iowa, L.C. (filed as Exhibit 2.10 to the February 1995 Form S-4 and
incorporated herein by reference)
2.11 Asset Purchase Agreement between the Registrant and RuralVision Joint
Venture (filed as Exhibit 2.11 to the Form 8-K Current Report dated as
of December 1, 1994 and filed with the Commission on December 14, 1994
(the "Form 8-K"), and incorporated herein by reference)
2.12 Agreement for Purchase and Sales of Assets between the Registrant and
REC Services, Inc. (filed as Exhibit 2.12 to the February 1995 Form
S-4 and incorporated herein by reference)
2.13 Letter Agreement among the Registrant, United States Wireless Cable,
Inc. and United States Wireless Cable Systems, Inc. (filed as Exhibit
2.13 to the February 1995 Form S-4 and incorporated herein by
reference)
2.14 Letter Agreement among the Registrant, Cross Country Wireless, Inc.
and RuralVision Joint Venture (filed as Exhibit 2.14 to the February
1995 Form S-4 and incorporated herein by reference)
2.15 Extension Agreement among the Registrant, Cross Country Wireless,
Inc., Cross Country Wireless Cable West, L.P., RuralVision Joint
Venture, RuralVision Central, Inc., RuralVision South, Inc. and
Selling Shareholders of RuralVision Central, Inc. and RuralVision
South, Inc. (filed as Exhibit 2.15 to the February 1995 Form S-4 and
incorporated herein by reference)
2.16 Note Modification Agreement among the Registrant, Cross Country
Wireless, Inc., Cross Country Wireless Cable West, L.P., RuralVision
Joint Venture, RuralVision Central, Inc., RuralVision South, Inc., the
Selling Shareholders of RuralVision Central, Inc. and RuralVision
South, Inc., the Larry D. Hudson Trust and Jerri Hudson Bell (filed as
Exhibit 2.16 to the February 1995 Form S-4 and incorporated herein by
reference)
2.17 Asset Purchase Agreement between Heartland Wireless Paducah, Inc. and
Cross Country Wireless, Inc. (filed as Exhibit 2.17 to the February
1995 Form S-4 and incorporated herein by reference)
2.18 First Amendment to Joint Venture Agreement between the Registrant and
Cross Country Wireless, Inc. (filed as Exhibit 2.18 to the February
1995 Form S-4 and incorporated herein by reference)
2.19 Venture Distribution Agreement between the Registrant and RuralVision
Joint Venture (filed as Exhibit 2.19 to the February 1995 Form S-4 and
incorporated herein by reference)
2.20 Stock Purchase Agreement between Wireless Communications, Inc. and
Robert R. Story (filed as Exhibit 2.20 to the Registrant's
Registration Statement on Form S-4, File No. 33-65357, (the "January
1996 Form S-4") and incorporated herein by reference)
2.21 Asset Purchase Agreement between United States Wireless Systems, Inc.
and Robert R. Story, Inc. (filed as Exhibit 2.21 to the January 1996
Form S-4 and incorporated herein by reference)
2.22 Amended and Restated Agreement and Plan of Merger dated as of
September 11, 1995, between American Wireless Systems, Inc., Heartland
Merger Sub, Inc. and the Registrant (filed as Exhibit 2.22 to the
January 1996 Form S-4 and incorporated herein by reference)
2.23 Amended and Restated Asset Purchase Agreement dated as of October 4,
1995, between Fort Worth Wireless Cable T.V. Associates and the
Registrant (filed as Exhibit 2.23 to the January 1996 Form S-4 and
incorporated herein by reference)
2.24 Amended and Restated Asset Purchase Agreement dated as of October 4,
1995, between Wireless Cable TV Associates #38 and the Registrant
(filed as Exhibit 2.24 to the January 1996 Form S-4 and incorporated
herein by reference)
II-2
<PAGE> 22
2.25 Amended and Restated Agreement and Plan of Merger dated as of
September 11, 1995, between CableMaxx, Inc., Heartland Merger Sub 2,
Inc. and the Registrant (filed as Exhibit 2.25 to the January 1996
Form S-4 and incorporated herein by reference)
2.26 Amended and Restated Asset Purchase Agreement dated as of October 19,
1995, between Three Sixty Corp., Technivision, Inc. and the Registrant
(filed as Exhibit 2.26 to the January 1996 Form S-4 and incorporated
herein by reference)
2.27 Participation Agreement dated as of December 12, 1995, by and among
Registrant, CAI Wireless Systems, Inc. and CS Wireless Systems, Inc.
(the "Participation Agreement") (filed as Exhibit 2.1 to the
Registrant's Current Report on Form 8-K dated December 12, 1995 and
incorporated herein by reference)
2.28 Amendment No. 1 to Participation Agreement dated February 22, 1996
(filed as Exhibit 2.7 to the Registrant's Current Report on Form 8-K
dated February 23, 1996 and incorporated herein by reference)
4.1 1994 Employee Stock Option Plan of the Registrant, as amended (filed
as Exhibit 4.1 to the Registrant's Annual Report on Form 10-K for the
year ended December 31, 1995 (the "Form 10-K") and incorporated herein
by reference)
4.2 Revised Form of Nontransferable Incentive Stock Option Agreement under
the 1994 Employee Stock Option Plan of the Registrant (filed as
Exhibit 4.2 to the Registrant's Registration Statement on Form S-4,
File No. 33-91930 (the "February 1996 Form S-4") and incorporated
herein by reference)
4.3 Revised Form of Nontransferable Non-Qualified Stock Option Agreement
under the 1994 Employee Stock Option Plan of the Registrant (filed as
Exhibit 4.3 to the February 1996 Form S-4 and incorporated herein by
reference)
4.4 1994 Stock Option Plan for Non-Employee Directors of the Registrant
(filed as Exhibit 4.4 to the Form S-1 and incorporated herein by
reference)
4.5 Form of Stock Option Agreement under the 1994 Stock Option Plan for
Non-Employee Directors of the Registrant (filed as Exhibit 4.5 to the
Form S-1 and incorporated herein by reference).
4.6 Warrant Agreement between the Registrant and Gerard Klauer Mattison &
Co., Inc. (including form of warrant certificate) (filed as Exhibit
4.6 to the Form S-1 and incorporated herein by reference)
4.7 Registration Rights Agreement among the Registrant, Jupiter Partners,
L.P. and Thomas R. Haack (filed as Exhibit 4.7 to the February 1995
Form S-4 and incorporated herein by reference)
4.8 Stockholders Agreement among the Registrant, Hunt Capital Group,
L.L.C., David E. Webb, L. Allen Wheeler and Jupiter Partners L.P.
(filed as Exhibit 4.8 to the February 1995 Form S-4 and incorporated
herein by reference)
4.9 Note Purchase Agreement among the Registrant, Jupiter Partners L.P.
and Thomas R. Haack (filed as Exhibit 4.9 to the February 1995 Form
S-4 and incorporated herein by reference)
4.10 First Amendment to Note Purchase Agreement among the Registrant,
Jupiter Partners L.P. and Thomas R. Haack (filed as Exhibit 4.10 to
the Form 10-K Annual Report filed with the Commission on March 31,
1995 (the "1995 Form 10-K"), and incorporated herein by reference)
4.11 Second Amendment to Note Purchase Agreement among the Registrant,
Jupiter Partners L.P. and Thomas R. Hack (filed as Exhibit 4.11 to the
February 1996 Form S-4 and incorporated herein by reference)
II-3
<PAGE> 23
4.12 Indenture between the Registrant and First Trust of New York, National
Association, as Trustee (the "Trustee") (filed as Exhibit 4.12 to the
February 1996 Form S-4 and incorporated herein by reference)
4.13 Supplemental Indenture dated October 2, 1995, between the Registrant
and the Trustee (filed as Exhibit 4.13 to the February 1996 Form S-4
and incorporated herein by reference)
4.14 Registration Rights Agreement among the Registrant, BT Securities
Corporation ("BT Securities") and Lazard Freres & Co. ("Lazard")
(filed as Exhibit 4.14 to the February 1996 Form S-4 and incorporated
herein by reference)
4.15 Securityholders' and Registration Rights Agreement among the
Registrant, BT Securities and Lazard (filed as Exhibit 4.15 to the
February 1996 Form S-4 and incorporated herein by reference)
4.16 Warrant Agreement between the Registrant and Bankers Trust Company, as
Warrant Agent (filed as Exhibit 4.16 to the February 1996 Form S-4 and
incorporated herein by reference)
4.17 Unit Agreement among the Registrant, Bankers Trust Company, as Unit
Agent and Warrant Agent, and the Trustee (filed as Exhibit 4.17 to the
February 1996 Form S-4 and incorporated herein by reference)
4.18 Escrow and Disbursement Agreement among the Registrant, Bankers Trust
Company, as Escrow Agent, and the Trustee (filed as Exhibit 4.18 to
the February 1996 Form S-4 and incorporated herein by reference)
4.19 Indenture between the Registrant and the Trustee (filed as Exhibit
4.19 to the Registrant's Registration Statement on Form S-4, File No.
333-125777 (the "September 1996 Form S-4") and incorporated herein by
reference)
4.20 Registration Rights Agreement among the Registrant and BT Securities
(filed as Exhibit 4.20 to the September 1996 S-4 and incorporated
herein by reference)
4.21 Escrow and Disbursement Agreement among the Registrant, Bankers Trust
Company, as Escrow Agent, and the Trustee (filed as Exhibit 4.21 to
the September 1996 S-4 and incorporated herein by reference)
**5 Opinion of Arter & Hadden (including the consent of such firm)
regarding legality of securities being offered
*23.1 Consent of Arter & Hadden (included as part of its opinion filed as
Exhibit 5 hereto)
*23.2 Consent of KPMG Peat Marwick LLP, independent certified public
accountants (Registrant)
*23.3 Consent of KPMG Peat Marwick LLP, independent certified public
accountants (Technivision, Inc.)
*23.4 Consent of Arthur Andersen LLP, independent certified public
accountants (American Wireless Systems, Inc., Wireless Cable TV
Associates #38, and Fort Worth Wireless Cable T.V. Associates)
*23.5 Consent of Coopers & Lybrand LLP, independent certified public
accountants (CableMaxx, Inc.)
*23.6 Consent of KPMG Peat Marwick, LLP, independent certified public
accountants (Cross Country Division)
24 Power of Attorney (included on page II-7)
- ----------------------
* Filed herewith.
** To be filed by amendment.
II-4
<PAGE> 24
(b) FINANCIAL STATEMENT SCHEDULES
All financial statement schedules are omitted because they are either
not applicable or the required information has been disclosed in the financial
statements or notes thereto.
ITEM 22. UNDERTAKINGS.
(a) Rule 415 Offering. 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) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration
Fee" table in the effective Registration Statement.
(iii) to include any material information with
respect to the plan of distribution not previously disclosed
in the Registration Statement or any material change to such
information in the Registration Statement.
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the Registration Statement is on Form S-3, Form S-8 or Form
F-3, and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
with or furnished to the Commission by the Registrant pursuant to
Section 13 or Section 15(d) of the 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) Filings incorporating subsequent Exchange Act documents by
reference. The undersigned 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 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to 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 securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(g) Registration on Form S-4 of securities offered for resale. The
undersigned Registrant hereby undertakes:
II-5
<PAGE> 25
(1) That prior to any public reoffering of the securities
registered hereunder through use of a prospectus which is a part of
this Registration Statement, by any person or party who is deemed to
be an underwriter within the meaning of Rule 145(c), the issuer
undertakes that such reoffering prospectus will contain the
information called for by the applicable registration form with
respect to reoffering by persons who may be deemed underwriters, in
addition to the information called for by the other Items of the
applicable form.
(2) That every prospectus (i) that is filed pursuant to the
immediately preceding undertaking, or (ii) that purports to meet the
requirements of Section 10(a)(3) of the Act and is used in connection
with an offering of securities subject to Rule 415, will be filed as a
part of an amendment to the Registration Statement and will not be
used until such amendment is effective, and that, for purposes 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.
(h) Request for acceleration of effective date. 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 Company's Certificate of Incorporation, Bylaws or otherwise,
the Registrant has been advised that in the opinion of the 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.
(i) Rule 430A. The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act, 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 any liability under the
Securities Act, 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.
The undersigned Registrant hereby undertakes to respond to requests
for information that is incorporated by reference into the Prospectus pursuant
to Item 4, 10(b), 11, or 13 of this Form, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained in the
documents filed subsequent to the effective date of the Registration Statement
through the date of responding to the request.
The undersigned Registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the Registration Statement when it became effective.
II-6
<PAGE> 26
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Plano,
State of Texas, on the 15th day of October, 1996.
HEARTLAND WIRELESS
COMMUNICATIONS, INC.
By: /s/ John R. Bailey
--------------------------
John R. Bailey
Senior Vice President-Finance
and Chief Financial Officer
(Principal Financial Officer)
POWER OF ATTORNEY
We, the undersigned directors and officers of HEARTLAND WIRELESS
COMMUNICATIONS, INC., do hereby constitute and appoint J. R. HOLLAND, JR. and
JOHN R. BAILEY, or either of them, our true and lawful attorneys and agents, to
do any and all acts and things in our name and on our behalf in our capacities
as directors and officers and to execute any and all instruments for us and in
our names in the capacities indicated below, which said attorneys and agents,
or either of them, may deem necessary or advisable to enable said Corporation
to comply with the Securities Act of 1933 and any rules, regulations and
requirements of the Securities and Exchange Commission, in connection with this
Registration Statement, including specifically, but without limitation, power
and authority to sign for us or any of us in our names in the capacities
indicated below, any and all amendments (including post-effective amendments)
hereto; and we do hereby ratify and confirm all that said attorneys and agents,
or either of them, shall do or cause to be done by virtue hereof.
II-7
<PAGE> 27
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed on the 14th day of October, 1996, by the
following persons in the capacities indicated:
<TABLE>
<CAPTION>
SIGNATURES TITLE
---------- -----
<S> <C>
/s/ J. R. Holland, Jr. Chairman of the Board and Director
- ----------------------------------
J. R. Holland, Jr.
/s/ L. Allen Wheeler Vice Chairman of the Board and
- ---------------------------------- Director
L. Allen Wheeler
/s/ David E. Webb President, Chief Executive Officer
- ---------------------------------- and Director
David E. Webb (Principal Executive Officer)
/s/ John R. Bailey Senior Vice President-Finance and
- ---------------------------------- Chief Financial Officer
John R. Bailey (Principal Financial Officer)
/s/ David D. Hagey Vice President-Finance, Treasurer and
- ---------------------------------- Assistant Secretary
David D. Hagey (Principal Accounting Officer)
/s/ Alvin H. Lane, Jr. Director
- ----------------------------------
Alvin H. Lane, Jr.
/s/ Dennis M. O'Rourke Director
- ----------------------------------
Dennis M. O'Rourke
/s/ John A. Sprague Director
- ----------------------------------
John A. Sprague
/s/ Wes W. Watkins Director
- ----------------------------------
Wes W. Watkins
</TABLE>
II-8
<PAGE> 28
INDEX TO EXHIBITS
EXHIBIT
NO. DESCRIPTION OF EXHIBITS
- ------- -----------------------
2.1 Letter Agreement regarding formation of the Registrant (filed as
Exhibit 2.1 to the Registrant's Registration Statement on Form S-1,
File No. 33-74244 (the "Form S-1") and incorporated herein by
reference)
2.2 Supplement to Letter Agreement regarding formation of the Registrant
(filed as Exhibit 2.2 to the Form S-1 and incorporated herein by
reference)
2.3 Asset Purchase Agreement among RuralVision Joint Venture, RuralVision
Central, Inc. and RuralVision South, Inc. (filed as Exhibit 2.3 to
the Registrant's Registration Statement on Form S-1, File No. 33-84408
(the "November Form S-1") and incorporated herein by reference)
2.4 Supplemental Agreement to the Asset Purchase Agreement among
RuralVision Joint Venture, RuralVision Central, Inc. and RuralVision
South, Inc. (filed as Exhibit 2.4 to the November Form S-1 and
incorporated herein by reference)
2.5 Closing Agreement amending the Supplemental Agreement among
RuralVision Joint Venture, RuralVision Central, Inc. and RuralVision
South, Inc. (filed as Exhibit 2.5 to the November Form S-1 and
incorporated herein by reference)
2.6 Asset Purchase Agreement between RuralVision Joint Venture and Cable
Equity Partners, Inc. (filed as Exhibit 2.6 to the November Form S-1
and incorporated herein by reference)
2.7 Letter Agreement amending Asset Purchase Agreement between RuralVision
Joint Venture and Cable Equity Partners, Inc. (filed as Exhibit 2.7 to
the November Form S-1 and incorporated herein by reference)
2.8 Letter Agreement between the Registrant and Cross Country Wireless,
Inc. (filed as Exhibit 2.8 to the November Form S-1 and incorporated
herein by reference)
2.9 Letter Agreement between the Registrant and Cable Equity Partners,
Inc. (filed as Exhibit 2.9 to the Registrant's Registration Statement
on Form S-4, File No. 33-87076 (the "February 1995 Form S-4") and
incorporated herein by reference)
2.10 Lease Purchase Agreement between the Registrant and Choice Television
of Iowa, L.C. (filed as Exhibit 2.10 to the February 1995 Form S-4 and
incorporated herein by reference)
2.11 Asset Purchase Agreement between the Registrant and RuralVision Joint
Venture (filed as Exhibit 2.11 to the Form 8-K Current Report dated as
of December 1, 1994 and filed with the Commission on December 14, 1994
(the "Form 8-K"), and incorporated herein by reference)
2.12 Agreement for Purchase and Sales of Assets between the Registrant and
REC Services, Inc. (filed as Exhibit 2.12 to the February 1995 Form
S-4 and incorporated herein by reference)
2.13 Letter Agreement among the Registrant, United States Wireless Cable,
Inc. and United States Wireless Cable Systems, Inc. (filed as Exhibit
2.13 to the February 1995 Form S-4 and incorporated herein by
reference)
2.14 Letter Agreement among the Registrant, Cross Country Wireless, Inc.
and RuralVision Joint Venture (filed as Exhibit 2.14 to the February
1995 Form S-4 and incorporated herein by reference)
2.15 Extension Agreement among the Registrant, Cross Country Wireless,
Inc., Cross Country Wireless Cable West, L.P., RuralVision Joint
Venture, RuralVision Central, Inc., RuralVision South, Inc. and
Selling Shareholders of RuralVision Central, Inc. and RuralVision
South, Inc. (filed as Exhibit 2.15 to the February 1995 Form S-4 and
incorporated herein by reference)
<PAGE> 29
2.16 Note Modification Agreement among the Registrant, Cross Country
Wireless, Inc., Cross Country Wireless Cable West, L.P., RuralVision
Joint Venture, RuralVision Central, Inc., RuralVision South, Inc., the
Selling Shareholders of RuralVision Central, Inc. and RuralVision
South, Inc., the Larry D. Hudson Trust and Jerri Hudson Bell (filed as
Exhibit 2.16 to the February 1995 Form S-4 and incorporated herein by
reference)
2.17 Asset Purchase Agreement between Heartland Wireless Paducah, Inc. and
Cross Country Wireless, Inc. (filed as Exhibit 2.17 to the February
1995 Form S-4 and incorporated herein by reference)
2.18 First Amendment to Joint Venture Agreement between the Registrant and
Cross Country Wireless, Inc. (filed as Exhibit 2.18 to the February
1995 Form S-4 and incorporated herein by reference)
2.19 Venture Distribution Agreement between the Registrant and RuralVision
Joint Venture (filed as Exhibit 2.19 to the February 1995 Form S-4 and
incorporated herein by reference)
2.20 Stock Purchase Agreement between Wireless Communications, Inc. and
Robert R. Story (filed as Exhibit 2.20 to the Registrant's
Registration Statement on Form S-4, File No. 33-65357, (the "January
1996 Form S-4") and incorporated herein by reference)
2.21 Asset Purchase Agreement between United States Wireless Systems, Inc.
and Robert R. Story, Inc. (filed as Exhibit 2.21 to the January 1996
Form S-4 and incorporated herein by reference)
2.22 Amended and Restated Agreement and Plan of Merger dated as of
September 11, 1995, between American Wireless Systems, Inc., Heartland
Merger Sub, Inc. and the Registrant (filed as Exhibit 2.22 to the
January 1996 Form S-4 and incorporated herein by reference)
2.23 Amended and Restated Asset Purchase Agreement dated as of October 4,
1995, between Fort Worth Wireless Cable T.V. Associates and the
Registrant (filed as Exhibit 2.23 to the January 1996 Form S-4 and
incorporated herein by reference)
2.24 Amended and Restated Asset Purchase Agreement dated as of October 4,
1995, between Wireless Cable TV Associates #38 and the Registrant
(filed as Exhibit 2.24 to the January 1996 Form S-4 and incorporated
herein by reference)
2.25 Amended and Restated Agreement and Plan of Merger dated as of
September 11, 1995, between CableMaxx, Inc., Heartland Merger Sub 2,
Inc. and the Registrant (filed as Exhibit 2.25 to the January 1996
Form S-4 and incorporated herein by reference)
2.26 Amended and Restated Asset Purchase Agreement dated as of October 19,
1995, between Three Sixty Corp., Technivision, Inc. and the Registrant
(filed as Exhibit 2.26 to the January 1996 Form S-4 and incorporated
herein by reference)
2.27 Participation Agreement dated as of December 12, 1995, by and among
Registrant, CAI Wireless Systems, Inc. and CS Wireless Systems, Inc.
(the "Participation Agreement") (filed as Exhibit 2.1 to the
Registrant's Current Report on Form 8-K dated December 12, 1995 and
incorporated herein by reference)
2.28 Amendment No. 1 to Participation Agreement dated February 22, 1996
(filed as Exhibit 2.7 to the Registrant's Current Report on Form 8-K
dated February 23, 1996 and incorporated herein by reference)
4.1 1994 Employee Stock Option Plan of the Registrant, as amended (filed
as Exhibit 4.1 to the Registrant's Annual Report on Form 10-K for the
year ended December 31, 1995 (the "Form 10-K") and incorporated herein
by reference)
4.2 Revised Form of Nontransferable Incentive Stock Option Agreement under
the 1994 Employee Stock Option Plan of the Registrant (filed as
Exhibit 4.2 to the Registrant's Registration Statement on Form S-4,
File No. 33-91930 (the "February 1996 Form S-4") and incorporated
herein by reference)
<PAGE> 30
4.3 Revised Form of Nontransferable Non-Qualified Stock Option Agreement
under the 1994 Employee Stock Option Plan of the Registrant (filed as
Exhibit 4.3 to the February 1996 Form S-4 and incorporated herein by
reference)
4.4 1994 Stock Option Plan for Non-Employee Directors of the Registrant
(filed as Exhibit 4.4 to the Form S-1 and incorporated herein by
reference)
4.5 Form of Stock Option Agreement under the 1994 Stock Option Plan for
Non-Employee Directors of the Registrant (filed as Exhibit 4.5 to the
Form S-1 and incorporated herein by reference).
4.6 Warrant Agreement between the Registrant and Gerard Klauer Mattison &
Co., Inc. (including form of warrant certificate) (filed as Exhibit
4.6 to the Form S-1 and incorporated herein by reference)
4.7 Registration Rights Agreement among the Registrant, Jupiter Partners,
L.P. and Thomas R. Haack (filed as Exhibit 4.7 to the February 1995
Form S-4 and incorporated herein by reference)
4.8 Stockholders Agreement among the Registrant, Hunt Capital Group,
L.L.C., David E. Webb, L. Allen Wheeler and Jupiter Partners L.P.
(filed as Exhibit 4.8 to the February 1995 Form S-4 and incorporated
herein by reference)
4.9 Note Purchase Agreement among the Registrant, Jupiter Partners L.P.
and Thomas R. Haack (filed as Exhibit 4.9 to the February 1995 Form
S-4 and incorporated herein by reference)
4.10 First Amendment to Note Purchase Agreement among the Registrant,
Jupiter Partners L.P. and Thomas R. Haack (filed as Exhibit 4.10 to
the Form 10-K Annual Report filed with the Commission on March 31,
1995 (the "1995 Form 10-K"), and incorporated herein by reference)
4.11 Second Amendment to Note Purchase Agreement among the Registrant,
Jupiter Partners L.P. and Thomas R. Hack (filed as Exhibit 4.11 to the
February 1996 Form S-4 and incorporated herein by reference)
4.12 Indenture between the Registrant and First Trust of New York, National
Association, as Trustee (the "Trustee") (filed as Exhibit 4.12 to the
February 1996 Form S-4 and incorporated herein by reference)
4.13 Supplemental Indenture dated October 2, 1995, between the Registrant
and the Trustee (filed as Exhibit 4.13 to the February 1996 Form S-4
and incorporated herein by reference)
4.14 Registration Rights Agreement among the Registrant, BT Securities
Corporation ("BT Securities") and Lazard Freres & Co. ("Lazard")
(filed as Exhibit 4.14 to the February 1996 Form S-4 and incorporated
herein by reference)
4.15 Securityholders' and Registration Rights Agreement among the
Registrant, BT Securities and Lazard (filed as Exhibit 4.15 to the
February 1996 Form S-4 and incorporated herein by reference)
4.16 Warrant Agreement between the Registrant and Bankers Trust Company, as
Warrant Agent (filed as Exhibit 4.16 to the February 1996 Form S-4 and
incorporated herein by reference)
4.17 Unit Agreement among the Registrant, Bankers Trust Company, as Unit
Agent and Warrant Agent, and the Trustee (filed as Exhibit 4.17 to the
February 1996 Form S-4 and incorporated herein by reference)
4.18 Escrow and Disbursement Agreement among the Registrant, Bankers Trust
Company, as Escrow Agent, and the Trustee (filed as Exhibit 4.18 to
the February 1996 Form S-4 and incorporated herein by reference)
4.19 Indenture between the Registrant and the Trustee (filed as Exhibit
4.19 to the Registrant's Registration Statement on Form S-4, File No.
333-125777 (the "September 1996 Form S-4") and incorporated herein by
reference)
<PAGE> 31
4.20 Registration Rights Agreement among the Registrant and BT Securities
(filed as Exhibit 4.20 to the September 1996 Form S-4 and incorporated
herein by reference)
4.21 Escrow and Disbursement Agreement among the Registrant, Bankers Trust
Company, as Escrow Agent, and the Trustee (filed as Exhibit 4.21 to
the September 1996 Form S-4 and incorporated herein by reference)
*5.1 Opinion of Arter & Hadden (including the consent of such firm)
regarding legality of securities being offered
*23.1 Consent of Arter & Hadden (included as part of its opinion filed as
Exhibit 5 hereto)
*23.2 Consent of KPMG Peat Marwick LLP, independent certified public
accountants (Registrant)
*23.3 Consent of KPMG Peat Marwick LLP, independent certified public
accountants (Technivision, Inc.)
*23.4 Consent of Arthur Andersen LLP, independent certified public
accountants (American Wireless Systems, Inc., Wireless Cable TV
Associates #38, and Fort Worth Wireless Cable T.V. Associates)
*23.5 Consent of Coopers & Lybrand LLP, independent certified public
accountants (CableMaxx, Inc.)
*23.6 Consent of KPMG Peat Marwick, LLP, independent certified public
accountants (Cross Country Division)
24 Powers of Attorney (included on page II-7)
- --------------------
* Filed herewith.
** To be filed by amendment.
<PAGE> 1
Exhibit 5.1
ARTER & HADDEN
1717 Main Street, Suite 4100
Dallas, Texas 75201
October 14, 1996
Heartland Wireless Communications, Inc.
200 Chisholm Place, Suite 200
Plano, Texas 75075
RE: OFFERING OF SHARES OF COMMON STOCK
OF HEARTLAND WIRELESS COMMUNICATIONS, INC.
Ladies and Gentlemen:
On October 15, 1996, Heartland Wireless Communications, Inc., a
Delaware corporation (the "Company"), expects to file with the Securities and
Exchange Commission a Registration Statement on Form S-4 (the "Registration
Statement") under the Securities Act of 1933, as amended (the "Act"). Such
Registration Statement relates to the offering (the "Offering") of up to
1,250,000 shares of the common stock, $.001 par value per share of the Company
(the "Common Stock"), that may be issued from time to time to certain persons
or entities in connection with certain acquisitions by the Company (the
"Acquisitions"), as described in the Registration Statement. This firm has
acted as counsel to you in connection with the preparation and filing of the
Registration Statement, and you have requested our opinion with respect to
certain legal aspects of the Offering.
In rendering our opinion, we have examined and relied upon the
original or copies, certified to our satisfaction, of (i) the Restated
Certificate of Incorporation, as amended, and the Restated Bylaws, as amended,
of the Company; (ii) copies of resolutions of the Board of Directors of the
Company authorizing the Offering; (iii) the Registration Statement and exhibits
thereto; and (iv) such other documents and instruments as we have deemed
necessary. In our examinations, we have assumed the genuineness of all
signatures and the authenticity of all documents submitted to us as originals,
and the conformity to original documents of all documents submitted to us as
certified or reproduction copies. As to various questions of fact material to
this opinion, and as to the content and form of the Restated Certificate of
Incorporation, the Restated Bylaws, resolutions, records and other documents or
writings of the Company, we have relied, to the extent we deem reasonably
appropriate, upon representations or certificates of officers or directors of
the Company and upon documents, records and instruments furnished to us by the
Company, without independent check or verification of their accuracy.
<PAGE> 2
Based on the foregoing examination and subject to the comments and
assumptions noted below, we are of the opinion that assuming (i) the Company
maintains an adequate number of authorized but unissued shares and/or treasury
shares of Common Stock available for issuance from time to time in connection
the Acquisitions, and (ii) subject to compliance by the Company with corporate
proceedings under the laws of Delaware applicable at the time of the issuance
of any such shares of Common Stock, in the Acquisitions, the shares of Common
Stock when so issued in connection with the Acquisitions as contemplated by the
Prospectus included as part of the Registration Statement after the
Registration Statement becomes, and while it remains effective, will be duly
and validly issued, fully paid and nonassessable.
This opinion is limited in all respects to the General Corporation Law
of the State of Delaware as in effect on the date hereof; however, we are not
members of the Bar of the State of Delaware and our knowledge of its General
Corporation Law is derived from a reading of the most recent compilation of
that statute available to us without consideration of any judicial or
administrative interpretations thereof.
We bring to your attention the fact that this legal opinion is an
expression of professional judgment and not a guaranty of result. This opinion
is given as of the date hereof, and we assume no obligation to update or
supplement such opinion to reflect any facts or circumstances that may
hereafter come to our attention or any changes in laws or judicial decisions
that may hereafter occur.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name under the caption "Legal
Matters" in the Prospectus forming a part of the Registration Statement. In
giving such consent, we do not admit that we come within the category of
persons whose consent is required by Section 7 of the Act or the rules and
regulations of the Securities and Exchange Commission thereunder.
Very truly yours,
/s/ Arter & Hadden
ARTER & HADDEN
<PAGE> 1
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Heartland Wireless Communications, Inc.:
We consent to (a) the incorporation by reference herein of our reports dated
March 8, 1996, on the consolidated balance sheets of Heartland Wireless
Communications, Inc. as of December 31, 1995 and 1994, and the related
consolidated statements of operations, stockholders' equity, and cash flows for
each of the years in the three-year period ended December 31, 1995, and the
related schedule, which reports are included in the December 31, 1995 annual
report on Form 10-K of Heartland Wireless Communications, Inc. and (b) the
reference to our firm under the heading "Experts" in the prospectus.
Our report relating to the consolidated statements of Heartland Wireless
Communications, Inc. refers to a change in the method of accounting for direct
costs and installation fees related to subscriber installations in 1995.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Dallas, Texas
October 10, 1996
<PAGE> 1
EXHIBIT 23.3
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Heartland Wireless Communications, Inc.:
We consent to (a) the incorporation by reference herein of our report dated
October 25, 1995, on the balance sheets of TechniVision, Inc. as of May 31,
1995 and 1994, and the related statements of operations, stockholders' deficit
and cash flows for each of the years in the three-year period ended May 31,
1995, which report is included in Form 8-K/A-2 of Heartland Wireless
Communications, Inc. filed with the Securities and Exchange Commission on April
26, 1996 and (b) the reference to our firm under the heading "Experts" in the
prospectus.
Our report relating to the financial statements of TechniVision, Inc. contains
an explanatory paragraph that states that TechniVision, Inc.'s recurring losses
from operations and excess of current liabilities over current assets raise
substantial doubt about the entity's ability to continue as a going concern.
The financial statements do not include any adjustments that might result from
the outcome of that uncertainty.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Dallas, Texas
October 10, 1996
<PAGE> 1
EXHIBIT 23.4
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 23,
1996, included in Heartland Wireless Communications, Inc.'s current report on
Form 8-K/A-2 dated February 23, 1996 and to all references to our firm
included in or made part of this registration statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Phoenix, Arizona
October 10, 1996.
<PAGE> 1
EXHIBIT 23.5
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Form S-4 to be filed by
Heartland Wireless Communications, Inc., of our report, which includes an
explanatory paragraph which states that specified circumstances raise
substantial doubt about CableMaxx, Inc.'s ability to continue as a going
concern, dated August 25, 1995, on our audits of the consolidated balance
sheets of CableMaxx, Inc. as of June 30, 1994 and 1995, and the related
consolidated statements of operations, stockholders' equity and cash flows for
the period December 18, 1992 to June 30, 1993 and for the years ended June 30,
1994 and 1995, and of the consolidated statements of operations and cash flows
of Supreme Cable Co., Inc. and Subsidiaries (the "Predecessor") for the period
from July 1, 1992 to December 17, 1992. We also consent to the reference to
our firm under the caption "Experts."
/s/ Coopers & Lybrand LLP
--------------------------------
COOPERS & LYBRAND L.L.P.
Austin, Texas
October 11, 1996
<PAGE> 1
EXHIBIT 23.6
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Heartland Wireless Communications, Inc.:
We consent to (a) the incorporation by reference herein of our report dated
July 28, 1995, on the balance sheets of Cross Country Division as of December
31, 1994 and 1993, and the related statements of operations, division equity
and cash flows for the year ended December 31, 1993, the period from January 1,
1994 to August 18, 1994 and the period from August 19, 1994 to December 31,
1994, which reports are included in the Form 8-K/A-2 of Heartland Wireless
Communications, Inc. filed with the Securities and Exchange Commission on April
26, 1996 and (b) the reference to our firm under the heading "Experts" in the
prospectus.
Our report relating to the financial statements of Cross Country Division
contains an explanatory paragraph that refers to a business combination in 1994
accounted for as a purchase involving assets comprising a portion of Cross
Country Division. As a result of the acquisition, financial information of
Cross Country Division for periods after August 18, 1994 is presented on a
different cost basis than that for periods before August 18, 1994 and,
therefore, such information is not comparable.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Dallas, Texas
October 10, 1996
