As filed with the Securities and Exchange Commission on January 20, 1998
Registration No. 333-39287
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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The Panda Project, Inc.
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(name of registrant as specified in its charter)
Florida 65-0323354
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(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
901 Yamato Road
Boca Raton, Florida 33431
(561) 994-2300
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(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
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C. Daryl Hollis
Executive Vice President and Chief Financial Officer
The Panda Project, Inc.
901 Yamato Road
Boca Raton, Florida 33431
(561) 994-2300
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(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Approximate date of commencement of proposed sale to the public:
As soon as practicable after this Registration Statement becomes
effective.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, check the
following box.[ ]
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If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check
the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same
offering.[ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.[ ]
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. [ ]
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The Registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective date until
the Registrant shall file a further amendment which specifically states
that this Registration Statement shall thereafter become effective in
accordance with Section 8(a) of the Securities Act of 1933 or until the
Registration Statement shall become effective on such date as the
Commission, acting pursuant to said Section 8(a), may determine.
- ii -
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE
SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE
REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR
SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION -- DATED JANUARY 20, 1998
PROSPECTUS
107,020 Shares
THE PANDA PROJECT, INC.
Common Stock
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All of the shares of common stock, par value $.01 per share
("Common Stock"), of The Panda Project, Inc. (the "Company") offered
hereby (the "Shares") are being sold by certain securityholders of the
Company (the "Selling Securityholders"). See "Selling Securityholders."
The Company will not receive any of the proceeds from the sale of the
Shares by the Selling Securityholders.
The Selling Securityholders have advised the Company that they
propose to sell the Shares from time to time in the over-the-counter
market, in ordinary brokerage transactions or otherwise at market prices
prevailing at the time of sale or at negotiated prices. See "Plan of
Distribution." The Common Stock is traded on the Nasdaq National Market
under the symbol "PNDA." On January 16, 1998 the last reported sale
price of the Common Stock on the Nasdaq National Market was $4.1875 per
share.
The shares of Common Stock offered hereby represent approximately
.85% of the total number of shares outstanding at December 31, 1997.
Sales of all or part of the Shares offered hereby could have a negative
impact on the market price of the Common Stock and adversely affect the
ability of the Company to raise capital through the sale of its equity
securities. See "Risk Factors -- Negative Effect of Future Sales of
Stock on Market Prices and Ability to Raise Capital" and "Plan of
Distribution."
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The Company will pay all the expenses, estimated to be $15,000, in
connection with this offering, other than selling expenses and
underwriting discounts, if applicable.
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The Common Stock offered hereby involves a high degree of
risk. See "Risk Factors" beginning on page 8.
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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 January 20, 1998
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TABLE OF CONTENTS
Page
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Available Information.....................................6
Incorporation of Certain Documents by Reference...........7
Risk Factors..............................................8
Year 2000 Issues..........................................19
Use of Proceeds...........................................19
Selling Securityholders...................................19
Plan of Distribution......................................20
Experts...................................................21
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AVAILABLE INFORMATION
The Panda Project, Inc. (the "Company") is subject to the
informational requirements of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and in accordance therewith files reports
and other information with the Securities and Exchange Commission (the
"Commission"). Reports, proxy statements and other information filed by
the Company with the Commission pursuant to the informational
requirements of the Exchange Act may be inspected and copied at the
public reference facilities maintained by the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549 and at the Commission's regional
offices located at 7 World Trade Center, 13th Floor, New York, New York
10048 and Northwestern Atrium Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Copies of such materials also may be
obtained from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. The
Common Stock of the Company is traded on the Nasdaq National Market.
Reports and other information concerning the Company may be inspected at
the National Association of Securities Dealers, Inc., 1735 K Street,
N.W., Washington, D.C. 20006.
The Company has filed with the Commission a Registration Statement
on Form S-3 with respect to the Shares (herein, together with all
amendments and exhibits, referred to as the "Registration Statement")
under the Securities Act of 1933, as amended (the "Securities Act").
This Prospectus does not contain all of the information set forth in the
Registration Statement and the exhibits and schedules thereto, as
certain items are omitted in accordance with the rules and regulations
of the Commission. For further information pertaining to the Company
and the Shares, reference is made to such Registration Statement and the
exhibits and schedules thereto, which may be inspected without charge at
the office of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549, and copies of which may be obtained from the Commission at
prescribed rates. The Commission also makes electronic filings publicly
available in the Internet within 24 hours of acceptance. The
Commission's Internet address is http://www.sec.gov. The Commission's
Web site also contains reports, proxy and information statements and
other information regarding registrants that file electronically with
the Commission.
No person has been authorized to give any information or to make
any representations in connection with this offering other than those
contained in this Prospectus and, if given or made, such other
information and representations must not be relied upon as having been
authorized by the Company. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, create any
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implication that there has been no change in the affairs of the Company
since the date hereof or that the information contained herein is
correct as of any time subsequent to its date. This Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy any
securities other than the registered securities to which it relates or
an offer to any person in any jurisdiction where such an offer would be
unlawful. This Prospectus does not constitute an offer to sell or a
solicitation of an offer to buy such securities in any circumstances in
which such offer or solicitation is unlawful.
Information contained in the Company's Web site shall not be
deemed to be part of this Prospectus.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission
are incorporated herein by reference:
(1) The Company's Annual Report on Form 10-K for the fiscal
year ended March 31, 1997;
(2) The Company's Quarterly Reports on Form 10-Q for the
quarter ended June 30, 1997 and the quarter ended September 30, 1997;
(3) The Company's Current Reports on Form 8-K filed October 6,
1997 and January 14, 1998; and
(4) The Company's Registration Statement on Form 8-A filed May
5, 1994, registering the Common Stock under Section 12(g) of the
Exchange Act.
All 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 hereof and prior to the termination of the offering of the Common
Stock registered hereby shall be deemed to be incorporated by reference
into this Prospectus and to be a part hereof from the date of filing
such documents. Any statement contained in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Prospectus to the extent
that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference
herein 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.
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The Company will provide without charge to each person to whom this
Prospectus is delivered, upon written or oral request of such person, a
copy of any or all of the documents incorporated by reference into this
Prospectus (without exhibits to such documents other than exhibits
specifically incorporated by reference into such documents). Requests
for such copies should be directed to The Panda Project, Inc., 901
Yamato Road, Boca Raton, Florida 33431, Attention: Chief Financial
Officer, (561) 994-2300.
RISK FACTORS
In addition to the other information in this Prospectus, the
following factors should be considered carefully in evaluating an
investment in the Common Stock offered by this Prospectus. This
Prospectus contains forward-looking statements that involve risks and
uncertainties. Such forward-looking statements are made only as of the
date of this Prospectus. Without limiting the foregoing, the words
"believes," "anticipates," "plans," "expects," "intends" and similar
expressions are intended to identify forward-looking statements. The
Company's actual results may 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
and elsewhere in this Prospectus.
1. LIMITED PRODUCT DEVELOPMENT AND OPERATING HISTORY. The
Company has a limited operating history upon which an evaluation of its
prospects can be made. Such prospects must be considered in light of the
risks, expenses and difficulties frequently encountered in the
establishment of a new business in the evolving electronics industry,
which is characterized by an increasing number of market entrants and
intense competition, as well as those encountered in the shift from
development to commercialization of new products based on innovative
technologies.
2. LIMITED REVENUES; HISTORY OF SIGNIFICANT LOSSES; ACCUMULATED
DEFICIT; ANTICIPATED FUTURE LOSSES. To date, the Company has generated
limited revenues from the sale of its Archistrat Computers, from
licensing fees and from the activities associated with its grant from
the Defense Advanced Research Projects Agency. The Company does not
anticipate deriving larger revenues from operations until such time, if
ever, that greater numbers of its Archistrat Computers, semiconductor
packages and connectors can be sold, as to which there can be no
assurance. Further, of the $2.4 million of revenues recognized in the
year ended March 31, 1997, $923,000 related to a barter transaction with
a software developer wherein the Company accepted software licenses,
consulting and training services, and services associated with the
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certification of one model of the Archistrat Computers to use the
software developer's CAD program and porting the software onto the
product, in exchange for 53 of its Archistrat Computers. Management
believes the amount of revenue recognized reflects the fair value of the
licenses and other services received and approximated the normal selling
price of the servers. Since inception (April 8, 1992), the Company has
incurred significant net losses, including losses of $1,800,340,
$6,931,346, $23,894,426 and $20,874,101 during the fiscal years ended
March 31, 1994, 1995, 1996 and 1997, respectively, and $6,231,792 during
the six months ended September 30, 1997, resulting in an accumulated
deficit of $60,147,693 as of September 30, 1997. In addition, the
Company anticipates losses to continue at least through December 31,
1997. Inasmuch as the Company expects to continue to incur operating
expenses totalling approximately $1,000,000 per month related to its
research and development and sales and marketing activities (including
salaries of executive, technical and research and development
personnel), the Company anticipates that such losses will continue until
such time, if ever, as the Company is able to generate sufficient
revenues to support its operations. There can be no assurance that the
Company will ever be able to generate sufficient revenues to achieve
profitable operations.
3. SIGNIFICANT CAPITAL REQUIREMENTS; POSSIBLE NEED FOR
ADDITIONAL FINANCING. The Company's capital requirements in connection
with its operations and development activities have been significant,
and such requirements may continue to be significant if the Company
receives large numbers of purchase orders for its Archistrat Computers,
semiconductor packages and connectors. The Company has been dependent
primarily upon the proceeds of sales of its securities to fund its
activities since inception. During the period from inception through
September 30, 1997, the Company raised capital of approximately $63
million (after deduction of underwriting discounts, commissions and
other selling costs) through the sale of Common Stock, warrants and
subordinated debentures and from the exercise of stock options and
warrants. Since June 1996, the Company has entered into five agreements
to license its VSPA and Compass Connector technologies and has begun to
receive revenues under two of these agreements. In addition, the
Company has taken actions to significantly reduce its expenses in all
areas, including compensation and benefits, research and development and
selling and administrative expenses.
In December 1997 and January 1998, the Company received loans
from Helix (PEI) Inc. in the aggregate amount of $2,000,000. Helix and
its affiliates own approximately 12% of the Common Stock of the Company.
James T.A. Wooder, a director of the Company, is a Vice President of
Helix's parent, Helix Investments (Canada) Inc. Such loans are secured
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by a security interest in the Company's intellectual property and are
due and payable on February 28, 1998. Failure of the Company to repay
such loans when due could cause the lender to foreclose on its security
interest in the Company's intellectual property which would have a
material adverse effect on the Company including possibly requiring the
Company to significantly curtail or cease its operations.
In the event the Company's working capital, as augmented by
proceeds from any sales revenue, prove to be insufficient to fund
operations (due to unanticipated expenses, delays, problems, or
otherwise), the Company would be required to seek additional financing.
Furthermore, depending upon the Company's progress in the development of
its products and technology and manufacturing capabilities, acceptance
of its products and technology by third parties, and the state of the
capital markets, the Company may also determine that it is advisable to
raise additional equity capital. In addition, in the event that the
Company receives a larger than anticipated number of purchase orders for
its Archistrat Computers or VSPA semiconductor package, it may require
resources substantially greater than it currently has or than are
otherwise available to the Company, and the Company may be required to
raise additional capital or engage third parties (as to which engagement
there can be no assurance) to assist the Company in meeting such orders.
The Company has no current arrangements with respect to, or sources of,
additional financing, and there can be no assurance that additional
financing will be available to the Company when needed on commercially
reasonable terms or at all. The inability of the Company to obtain
additional financing when needed would have a material adverse effect on
the Company, including possibly requiring the Company to significantly
curtail or cease its operations. To the extent that any future financing
involves the sale of the Company's equity securities, the Company's then
existing stockholders may be substantially diluted.
4. UNCERTAINTY OF MARKET ACCEPTANCE. The products and
technologies currently being sold or developed by the Company utilize
newly developed designs. Although the Company believes that its existing
and proposed technology and products represent significant advancements
in semiconductor packaging and computer technology, demand for the
Company's existing and proposed products is subject to a high degree of
uncertainty, as is typical in the case of newly-developed products.
Achieving marketing acceptance for the Company's technology and existing
and proposed products will require substantial marketing efforts and
expenditure of significant funds to educate key original equipment
manufacturers ("OEMs") and value-added resellers ("VARs") and end users
as to the distinctive characteristics and anticipated benefits of the
Company's proposed products and technologies. Many OEMs and VARs
manufacture and/or sell components and computers competitive with those
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being developed by the Company and have achieved significant market
acceptance for their products. Accordingly, due to their commitment to
their own products, such entities may be inhibited from doing business
with the Company. In addition, many OEMs and VARs may be reluctant to
use or sell the Company's products and technologies until a sufficient
number of other OEMs and VARs have already committed to do so. The
Company has recently hired sales and marketing personnel for its
Archistrat Computers and for its VSPA semiconductor package and Compass
Connector, and it has established a network of twelve independent sales
organizations to supplement the Company's internal sales force. The
Company's ability to generate revenue from the sale of Archistrat
Computers or the licensing or sale of Archistrat Computers, VSPA
semiconductor packages or Compass Connectors will be dependent upon,
among other things, its ability to effectively use the internal sales
force and its network of independent sales organizations to market its
products. There can be no assurance that the Company's marketing
efforts will be successful.
5. UNCERTAINTY OF PRODUCT AND TECHNOLOGY DEVELOPMENT;
TECHNOLOGICAL FACTORS; DEPENDENCE ON THIRD-PARTY PRODUCT DESIGN CHANGES.
The Company's success will depend in part upon its products and
technology meeting acceptable cost and performance criteria, and upon
their timely introduction into the marketplace. There can be no
assurance that the Company's products and technology will satisfactorily
perform the functions for which they are designed, that they will meet
applicable price or performance objectives or that unanticipated
technical or other problems will not occur which would result in
increased costs or material delays in their development or
commercialization. In addition, technology as complex as that which will
be incorporated into the Company's proposed products may contain errors
which become apparent subsequent to widespread commercial use. Remedying
such errors could delay the Company's plans and cause it to incur
additional costs which would have a material adverse effect on the
Company. The Company's success will also be dependent upon the Company's
ability to adapt its products to be compatible with the products of
third-party manufacturers of computer products. In addition, the Company
will be dependent on certain potential customers redesigning or
otherwise modifying their products to fully utilize the Company's
proposed products and technology. Although the Company believes that
potential customers will undertake such modifications to take advantage
of the anticipated performance advantages of the Company's proposed
products, the costs of making such adaptations could prevent them from
doing so on a timely basis, or at all. The failure of the Company to
adapt its products and technology to be compatible with products of
third-party manufacturers or the failure of potential customers to make
necessary modifications or to redesign their products to accommodate the
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Company's products could have a material adverse effect on the Company's
ability to sell or license its proposed products or technology.
6. COMPETITION; TECHNOLOGICAL OBSOLESCENCE. The markets that
the Company intends to enter are characterized by intense competition.
The Company's Archistrat Computers compete with computers offered by
such companies as Silicon Graphics, Inc., Digital Equipment Corp., Sun
Microsystems, Inc., Hewlett-Packard Co. and other smaller companies.
The Company's Technology Products compete with semiconductor packages
and connectors offered by numerous manufacturers. Many of these
companies have substantially greater financial, technical, personnel and
other resources than the Company and have established reputations for
success in the development, licensing, sale and servicing of their
products and technology. Certain of these competitors dominate their
industries and have the financial resources necessary to enable them to
withstand substantial price competition or downturns in the market for
semiconductor packages, related technologies and/or computers. In
addition, certain companies may be developing technologies or products
of which the Company is unaware, which may be functionally similar, or
superior, to some or all of the Company's products and technologies.
Accordingly, the ability of the Company to compete will depend on its
ability to complete development and introduce to the marketplace in a
timely and cost-competitive manner additional products and technology,
to continually enhance and improve its existing and proposed products,
to adapt its products to be compatible with specific products
manufactured by others, and to successfully develop and market new
products. There can be no assurance that the Company will be able to
compete successfully, that its competitors or future competitors will
not develop technologies or products that render the Company's products
and technology obsolete or less marketable or that the Company will be
able to successfully enhance its products or technology or adapt them
satisfactorily.
7. DEPENDENCE ON MANUFACTURERS AND SUPPLIERS; LACK OF
MANUFACTURING EXPERIENCE AND CAPABILITY. The Company has developed the
ability to manufacture the VSPA semiconductor package in its own
facility in Boca Raton, Florida. The automated machinery used in the
manufacturing process has been designed and built by the Company to
produce VSPA parts based on anticipated customer demand. The machines
have a wide range of flexibility in terms of the pin count of the VSPA
packages they will produce, and expected production capacity ranges from
235,000 parts per month to 290,000 parts per month, depending upon the
pin count of the package. One automated machine has been produced and a
second is nearing completion. However, no commercial scale production
of the VSPA product has yet been commenced and there can be no assurance
that the Company will be able to complete additional machines within a
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reasonable period of time, or be capable of producing the quantities of
VSPA that are anticipated. In the event the Company is unable to
produce VSPA in high volumes within a reasonable period of time, or at
all, delays in securing alternative manufacturing sources would result
and would have a material adverse effect on the Company's operations.
The Company has developed the capability to manufacture the
Compass II Connector products required for its Archistrat Computers in
its own facility in Boca Raton, Florida. The Company has also entered
into an agreement with Sun Precision Works, Pvt. Ltd. for the production
of the male connector component of the Compass II Connector. Although
the Company's supply of this component is currently adequate to meet its
needs, no assurance can be given that such supplier can produce such
component in sufficient quantities in the future. The Company has an
arrangement with LG Cable & Machinery Ltd. to supply the Compass V
Connector which the Company expects to use in the next series of the
Archistrat Computers. Although the Company anticipates that it will be
able to obtain Compass V Connectors from LG Cable & Machinery Ltd. under
this arrangement, no assurance can be given that the supply of such
component will be in quantities sufficient to meet the Company's needs.
The Company anticipates that it will be dependent on third parties
for the manufacture and/or assembly of printed circuit boards, chassis
and other subassemblies, as well as for the supply of various of the
components, incorporated into the Archistrat Computers, and for
performing the final assembly configuration, certain quality control
testing and delivery of such computers. Although the Company has an
arrangement with a contract manufacturer to manufacture certain
subassemblies and has identified an alternative manufacturer for such
components, there can be no assurance that such manufacturers will
dedicate sufficient production capacity to satisfy the Company's
requirements within scheduled delivery times or at all. In addition,
the failure or delay by the Company's suppliers in fulfilling its
anticipated component needs would adversely affect the Company's ability
to develop and market its products and technology. The Company believes
that these components are available from multiple sources, and the
Company anticipates that it will obtain certain of them from a single or
limited number of sources of supply. In the event that certain of such
suppliers are unable or unwilling to provide the Company with components
to be used in the Archistrat Computers on commercially reasonable terms,
or at all, delays in securing alternative sources of supply could result
in a material adverse effect on the Company's operations.
At a future date, the Company may determine that the development of
manufacturing capabilities with respect to the Archistrat Computers
(and/or their subassemblies or components) is necessary or appropriate.
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The establishment of manufacturing and/or assembly capabilities may
result in significant expense and is subject to numerous risks,
including unanticipated technological problems and delays. The failure
of the Company to successfully manufacture its Archistrat Computers
would have a material adverse effect on the Company.
8. DEPENDENCE ON KEY PERSONNEL. The success of the Company will
be dependent on the continued personal efforts of Stanford W. Crane,
Jr., its Chairman, President and Chief Executive Officer and the
principal inventor of its proprietary products and technologies, and
certain other key personnel. Although Mr. Crane has entered into a
five-year employment agreement with the Company, the agreement provides
that he may resign by giving six months' notice at any time. The loss of
his services would have a material adverse effect on the Company. The
Company has obtained key-man insurance on Mr. Crane's life in the amount
of $2,000,000. The success of the Company also is dependent upon its
ability to hire and retain additional qualified executive, scientific,
production and marketing personnel. Although the Company has been able
to hire qualified personnel, there can be no assurance that the Company
will be able to hire additional qualified personnel or retain such
necessary personnel.
9. PATENTS AND PROPRIETARY INFORMATION. The Company's success
will depend on its ability to obtain patents, protect trade secrets, and
operate without infringing on the proprietary rights of others. As of
September 30, 1997, the Company had obtained eleven United States
patents and an aggregate of 37 foreign patents. In addition, the
Company had pending a total of 17 United States and 33 foreign patent
applications. These patents and pending applications relate to VSPA,
Compass PGA, the Archistrat Computers design, the use of the Compass
Connector in Compass PGA and in the Archistrat Computers, and a PCB
manufacturing technology known as "Well Tech PCB". The Company's
foreign patent filings have been made in selected countries, including
the Republic of China (Taiwan), Germany, the United Kingdom, Ireland and
France. The Company will continue to file applications in certain
foreign jurisdictions to secure protection in those jurisdictions in
accordance with the Patent Cooperation Treaty and the Paris Convention
for the Production of Industrial Property (which allows such filings to
relate back to the original filing date in the United States) covering
the Company's technology and proposed products. To the extent possible,
the Company also intends to file patent applications with respect to
products and technology that it may develop in the future.
There can be no assurance that any of the Company's pending patent
applications will ultimately result in an issued patent. Moreover, the
patent laws of other countries may differ from those of the United
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States as to the patentability of the Company's products or technology,
and the degree of protection afforded by foreign patents may be
different from that in the United States. The failure by the Company to
obtain patents for which applications are currently pending could have a
material adverse effect on the Company's ability to commercialize
successfully its proposed technology and products. Even if the Company
is able to obtain such patents, there can be no assurance that any such
patents will afford the Company commercially significant protection for
its technology or products. In addition, other companies may
independently develop equivalent or superior technologies or products
and may obtain patent or similar rights with respect to them. Although
the Company believes that its technology has been independently
developed and that its technology does not infringe on the patents or
violate the proprietary rights of others, there can be no assurance that
any of the Company's technology or products, will not be determined to
infringe upon the patents or proprietary rights of others, or that
patents or proprietary rights of others will not have an adverse effect
on the ability of the Company to do business. If the Company's
technology or products were determined to infringe on the patents,
trademarks or proprietary rights of others, the Company could, under
certain circumstances, become liable for damages, which also could have
a material adverse effect on the Company. Moreover, in the event that
the Company's technology or proposed products were deemed to infringe
upon the rights of others, the Company would be required to obtain
licenses to utilize such technology. There can be no assurance that the
Company would be able to obtain such licenses in a timely manner or on
acceptable terms and conditions, and the failure to do so could have a
material adverse effect on the Company. If the Company were unable to
obtain such licenses, it could encounter significant delays in product
market introductions while it attempted to design around the infringed
upon patents or rights, or could find the development, manufacture or
sale of products requiring such licenses to be foreclosed. In addition,
patent disputes are common in the computer industry and there can be no
assurance that the Company will have the financial resources to enforce
or defend a patent infringement or proprietary rights action.
The Company relies on confidentiality and nondisclosure
arrangements with its employees, consultants and others involved with
the Company's product and technological development efforts. There can
be no assurance that these agreements will provide meaningful protection
to the Company or that other companies will not acquire information
which the Company considers proprietary. Moreover, there can be no
assurance that other companies will not independently develop know-how
comparable or superior to that of the Company.
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The Company has registered the Archistrat and VSPA trademarks with
the U.S. Patent and Trademark Office and has applied for appropriate
trademark, copyright and other legal protection for its product names,
logos and other identifications. There can be no assurance that the
Company will not be precluded by others from using any of such
identifications or creating proprietary rights with respect to them.
10. DEPENDENCE ON THE CRANE-PANDA LICENSING AGREEMENT;
POTENTIAL CONFLICTS OF INTEREST. Pursuant to a license agreement entered
into in January 1996 between the Company and Mr. Crane (the "Crane-Panda
License"), Mr. Crane has granted the Company the nonexclusive right to
utilize the Compass Connector, a key component in the commercialization
of the Company's Archistrat Computers and the development and
commercialization of Compass PGA. The Crane-Panda License was executed
in connection with the conversion to a nonexclusive license of the 3M
License described below and supersedes an earlier license agreement
between Mr. Crane and the Company relating to the Compass Connector.
Under the Crane-Panda License, the Company is required to pay Mr. Crane
a royalty on any sales of Compass Connectors as discrete parts in the
amount of 5% of the net sales price for the first five years of the term
of the agreement, 2.5% of the net sales price for the next five years of
the term of the agreement and 2% of the net sales price thereafter,
provided that no royalty is payable until aggregate net sales of the
Compass Connector as discrete parts exceed $100,000. The royalty rate
will be reduced after the fifth anniversary of the agreement if no
patent remains in effect with respect to the Compass Connector. No
royalty is payable on sales of the Compass Connector as incorporated in
the Archistrat Computers or other computer system or assembly. The
Company may grant sublicenses under the Crane-Panda License, but only
for the use of products as incorporated in the Archistrat Computers or
other computer system or assembly. To date, there have been no sales
requiring the payment of royalties to Mr. Crane under the Crane-Panda
License. The Crane-Panda License obligates the Company to maintain
proprietary information relating to the Compass Connector on a
confidential basis, notify Mr. Crane of any evidence of infringement
with respect to the Compass Connector and related technology, and
cooperate with Mr. Crane to contest any such infringement. In the event
that the Company becomes bankrupt or insolvent or defaults in any of its
material obligations under the Crane-Panda License and fails to cure any
such defaults within specified cure periods, Mr. Crane may terminate the
Crane-Panda License. The Company is substantially dependent upon the
Crane-Panda License. The termination of the agreement under any
circumstances would have a material adverse effect on the Company.
Although actions of the Company with respect to the Crane Panda License
must be authorized by a majority of the Company's independent directors,
and the Company and Mr. Crane would be represented by separate counsel
<PAGE>
Page 17
in the event of a dispute concerning the Crane Panda License, there can
be no assurance that conflicts of interest will not arise with respect
to the Crane-Panda License or that such conflicts will be resolved in a
manner favorable to the Company. In addition, Mr. Crane retains
ownership of the Compass Connector technology, and has the right to
grant licenses to or otherwise transfer rights to the Compass Connector
technology to third parties.
In September 1992, Mr. Crane granted an exclusive license (the "3M
License") to Minnesota Mining and Manufacturing Co. ("3M") to develop,
manufacture, use and sell the Compass Connector other than as part of a
computer system. In February 1996, Mr. Crane and 3M agreed to convert
the 3M License to a nonexclusive license. The 3M License provides in
certain circumstances for the payment of a royalty to Mr. Crane. As of
the date of this Prospectus, Mr. Crane had received no such payments.
11. SUBSTANTIAL CONTROL BY MANAGEMENT. As of the date of this
Prospectus, officers and directors of the Company own of record and
beneficially approximately 34% of the issued and outstanding shares of
Common Stock and are thus able to exert substantial influence over the
policies and affairs of the Company.
12. RISKS RELATING TO POTENTIAL INTERNATIONAL OPERATIONS.
Although the Company currently prices all of its international sales in
U.S. dollars, future sales or licensing of its products or technologies
outside the U.S. may be subject to the risks associated with
fluctuations in currency exchange rates. The Company may also be subject
to other risks associated with international operations, including
tariff regulations and requirements for export licenses, particularly
with respect to the export of certain technologies (which licenses may
on occasion be delayed or difficult to obtain), unexpected changes in
regulatory requirements, longer accounts receivable requirements,
difficulties in managing international operations, potentially adverse
tax consequences, economic and political instability, restrictions on
repatriation of earnings, and the burdens of complying with a wide
variety of foreign laws. In addition, the laws of certain countries do
not protect the Company's products and intellectual property rights to
the same extent as do the laws of the United States. There can be no
assurance that such factors will not have a material adverse effect on
the Company's future international sales or licenses and, consequently,
on the Company's business and operations as a whole.
13. REGISTRATION RIGHTS; OUTSTANDING OPTIONS AND WARRANTS. The
Company has granted to Mr. Crane the right to include up to
approximately 496,000 of his shares of Common Stock (which volume
restrictions will be eliminated after May 16, 1999) each year in certain
<PAGE>
Page 18
Registration Statements which may be filed by the Company. The
possibility that substantial amounts of Common Stock may be sold in the
public market may adversely affect prevailing market prices for the
Common Stock and could impair the Company's ability in the future to
raise additional capital through the sale of its equity securities.
As of September 30, 1997, the Company has reserved 2,209,321 shares
of Common Stock for issuance upon the exercise of warrants. In
addition, the Company has reserved 1,012,782 shares of Common Stock for
issuance to employees, officers, directors and consultants under its
1995 Employee Stock Incentive Plan, 1993 Performance Incentive Plan and
Non-Employee Director Stock Option Plan. The price which the Company
may receive for the Common Stock issuable upon exercise of such warrants
and options will, in all likelihood, be less than the market price of
the Common Stock at the time of such exercise. Consequently, for the
life of such warrants and options, the holders thereof may have been
given, at nominal cost, the opportunity to profit from a rise in the
market price of the Common Stock. The exercise of all of the
aforementioned securities may also adversely effect the terms under
which the Company could obtain additional equity capital. Should a
significant number of these securities be exercised, the resulting
increase in the amount of the Common Stock in the public market may
reduce the market price of the Common Stock.
14. ANTITAKEOVER STATUTES. Florida has enacted legislation
that may deter or frustrate takeovers of the Company. The Florida
Control Share Act generally provides that shares acquired in excess of
certain specified thresholds, starting at 20%, will not possess any
voting rights unless such voting rights are approved by a majority vote
of a corporation's disinterested shareholders. The Florida Affiliated
Transactions Act generally requires supermajority approval by
disinterested directors or shareholders of certain specified
transactions between a corporation and holders of more than 10% of the
outstanding voting shares of the corporation or their affiliates.
15. POSSIBLE LACK OF RESOURCES OF SELLING SECURITYHOLDERS. The
Selling Securityholders may be deemed to be Underwriters pursuant to the
Securities Act, and in that regard may become liable to the purchasers
of the Common Stock offered hereby pursuant to the terms of the
Securities Act if certain provisions of the Securities Act are not
complied with by them. There can be no assurance that any of the
Selling Securityholders have the financial resources to discharge any
such liability.
16. GENERAL. Because of factors discussed above and other
factors, past financial performance should not be considered an
<PAGE>
Page 19
indicator of future performance. Investors should not use historical
trends to anticipate future results and should be aware that the
Company's financial condition may be subject to wide fluctuations in
response to quarter-to-quarter variations in operating results, general
conditions in the semiconductor packaging and computer industries,
changes in earnings estimates and recommendations by analysts and other
events.
YEAR 2000 ISSUES
The Company has developed preliminary plans to address the
possible exposures related to the impact on its computer systems of the
Year 2000. Key financial, information and operational systems will be
assessed and plans will be developed to address required systems
modifications. The financial impact of making the required systems
changes is not expected to be material to the Company's financial
position, results of operations or cash flows.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the
Shares by the Selling Securityholders.
SELLING SECURITYHOLDERS
All of the shares of Common Stock of the Company offered hereby are
being sold by the Selling Securityholders named below. The Company will
receive none of the proceeds from the sale of shares offered hereby. To
the best knowledge of the Company, none of the Selling Securityholders
beneficially owns 5% or more of the Company's outstanding Common Stock
and none of the Selling Securityholders has held any office or
maintained any material relationship with the Company or its
predecessors or affiliates over the past three years.
The following table sets forth information concerning the
beneficial ownership of shares of Common Stock by the Selling
Securityholders as of September 30, 1997 and the number of such shares
included for sale in this Prospectus, assuming the sale of all Shares
being offered by this Prospectus. The Common Stock offered hereby
consists of (i) 42,667 and 27,429 shares, respectively, issuable upon
the exercise of warrants (the "Warrants") granted by the Company to
Dusseldorf Securities Limited and Jefferies & Company, Inc. in
connection with a private placement by the Company of subordinated
convertible debentures completed on April 14, 1997, and (ii) up to
<PAGE>
Page 20
36,924 shares (the "IIRG Shares") issuable to International Investor
Relations Group, Inc. pursuant to a consulting agreement dated June 9,
1997 (the "Consulting Agreement"). The Warrants are exercisable during
the period beginning April 14, 1997 and ending April 2, 2002 at exercise
prices of $6.75 per share, in the case of the Warrant issued to
Dusseldorf Securities Limited and $7.00 per share, in the case of the
Warrant issued to Jefferies & Company, Inc. Of the IIRG shares, 18,462
have been issued as of the date hereof and, unless the Consulting
Agreement is terminated, 9,231 shares shall be issued to IIRG on each
of March 6, 1998 and June 6, 1998.
Shares Shares
Owned Shares Owned
Selling Prior to Offered After
Securityholders Offering Hereby Offering
- --------------- -------- ------- --------
Dusseldorf Securities
Limited 73,585 42,667 30,918
Jefferies & Company, Inc. 24,429 24,429 --
International Investor
Relations Group, Inc. 36,924 (1) 36,924 (1) --
--------
(1) Assumes issuance by the Company of all of the IIRG Shares.
PLAN OF DISTRIBUTION
The Shares may be offered for sale from time to time by the
Selling Securityholders to various purchasers, or they may be retained.
The Selling Securityholders may elect to sell the Shares in negotiated
transactions at prices and on terms related to the then-current market
price or otherwise, or in market transactions, or to pledgees, donees or
other transferees, in each case without the participation of
underwriters, brokers or dealers. The shares may also be offered for
sale and sold by any such donees, pledgees or other transferees. The
Selling Securityholders or such donees, pledgees or other transferees
may also from time to time offer the Shares through brokers, dealers or
agents, or through underwriters, who may receive underwriting discounts,
concessions or commissions from the Selling Securityholders and/or the
purchasers for whom they act as agent. In that event, the offers or
sales may be made (i) by a block trade in which a broker or dealer,
engaged for the purpose, will attempt to sell the Shares as agent but
may position and resell a portion of the block as principal to
<PAGE>
Page 21
facilitate the transaction, (ii) by purchases by a broker or dealer as
principal and resale by such broker or dealer for its own account, (iii)
by ordinary brokerage transactions or transactions in which the broker
solicits purchasers, (iv) with the permission of the Company, in an
underwritten transaction, or (v) otherwise. In the event that brokers
or dealers are engaged by the Selling Securityholders or their donees,
pledgees or other transferees, such brokers or dealers may arrange for
other brokers or dealers to participate.
Any Shares which qualify for sale pursuant to Rule 144 under the
Securities Act may be sold under Rule 144 rather than pursuant to this
Prospectus.
In offering the Shares, the Selling Securityholders and any
broker-dealers and any other participating broker-dealers who execute
sales for the Selling Securityholders may be deemed to be "underwriters"
within the meaning of the Securities Act in connection with such sales,
and any profits realized by the Selling Securityholders and the
compensation of such broker- dealers may be deemed to be underwriting
discounts and commissions.
The public offering of the Shares by the Selling Securityholders
will terminate on the earlier of (a) two years from the date of this
Prospectus, or (b) the date on which all Shares have been sold by the
Selling Securityholders.
The Company will pay certain expenses incidental to the offering
and sale of the Shares to the public estimated to be approximately
$15,000. The Company will not pay for, among other expenses, selling
expenses or underwriting discounts, if applicable.
EXPERTS
The financial statements incorporated in this Prospectus by
reference to the Annual Report on Form 10-K of The Panda Project, Inc.
for the year ended March 31, 1997 have been so incorporated in reliance
on the report (which contains an explanatory paragraph relating to The
Panda Project, Inc.'s ability to continue as a going concern as
described in Note 1 to the financial statements) of Price Waterhouse
LLP, independent accountants, given on the authority of said firm as
experts in auditing and accounting.
<PAGE>
Page 22
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the various expenses in connection
with the sale and distribution of the securities being registered, other
than the underwriting discounts and commissions. All these expenses
will be paid by the Company.
Nature of Expense
- -----------------
SEC registration fee................................. $ 275
Legal and accounting fees and expenses............... 10,000 *
Miscellaneous........................................ 4,725 *
--------
TOTAL $ 15,000 *
========
* Estimated
Item 15. Indemnification of Directors and Officers. Florida
Business Corporation Act.
Section 607.0850(1) of the Florida Business Corporation Act (the
"FBCA") provides that a Florida corporation, such as the Registrant,
shall have the power to indemnify any person who is or was a party to
any proceeding (other than an action by, or in the right of, the
corporation), by reason of the fact that he is or was a director,
officer, employee or agent of the corporation or is or was serving at
the request of the corporation as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other
enterprise, against liability incurred in connection with such
proceeding, including any appeal thereof, if he acted in good faith and
in a manner he reasonably believed to be in, or not opposed to, the best
interests of the corporation and, with respect to any criminal action of
proceeding, had no reasonable cause to believe his conduct was unlawful.
Section 607.0850(2) of the FBCA provides that a Florida corporation
shall have the power to indemnify any person who is or was a party to
any proceeding by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he is or was a
director, officer, employee or agent of the corporation or is or was
<PAGE>
Page 23
serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses and amounts paid in
settlement not exceeding, in the judgment of the board of directors, the
estimated expense of litigating the proceeding to conclusion, actually
and reasonably incurred in connection with the defense or settlement of
such proceeding, including any appeal thereof. Such indemnification
shall be authorized if such person acted in good faith and in a manner
he reasonably believed to be in, or not opposed to, the best interests
of the corporation, except that no indemnification shall be made under
Section 607.0850(2) in respect of any claim, issue or matter as to which
such person shall have been adjudged to be liable unless, and only to
the extent that, the court in which such proceeding was brought, or any
other court of competent jurisdiction, shall determine upon application
that, despite the adjudication of liability but in view of all
circumstances of the case, such person is fairly and reasonably entitled
to indemnity for such expenses which such court shall deem proper.
Section 607.0850 of the FBCA further provides that, to the extent
that a director, officer, employee or agent of a corporation has been
successful on the merits or otherwise in defense of any proceeding
referred to in subsection (1) or subsection (2), or in defense of any
claim, issue or matter therein, he shall be indemnified against expenses
actually and reasonably incurred by him in connection therewith; that
indemnification provided pursuant to Section 607.0850 is not exclusive;
and that the corporation may purchase and maintain insurance on behalf
of a director, officer, employee or agent of the corporation against any
liability asserted against him or incurred by him in any such capacity
or arising out of his status as such whether or not the corporation
would have the power to indemnify him against such liabilities under
Section 607.0850.
Notwithstanding the foregoing, Section 607.0850 of the FBCA
provides that indemnification of advancement of expenses shall not be
made to or on behalf of any director, officer, employee or agent if a
judgment or other final adjudication establishes that his actions, or
omissions to act, were material to the cause of action so adjudicated
and constitute: (a) a violation of the criminal law, unless the
director, officer, employee or agent had reasonable cause to believe his
conduct was lawful or had no reasonable cause to believe his conduct was
unlawful; (b) a transaction from which the director, officer, employee
or agent derived an improper personal benefit; (c) in the case of a
director, a circumstance under which the liability provisions regarding
unlawful distributions are applicable; or (d) willful misconduct or a
conscious disregard for the best interests of the corporation in a
proceeding by or in the right of the corporation to procure a judgment
<PAGE>
Page 24
in its favor or in a proceeding by or in the right of a shareholder.
Section 607.0831 of the FBCA provides that a director of a Florida
corporation is not personally liable for monetary damages to the
corporation or any other person for any statement, vote, decision, or
failure to act, regarding corporate management or policy, by a director,
unless: (a) the director breached or failed to perform his duties as a
director, and (b) the director's breach of, or failure to perform, those
duties constitutes: (1) a violation of the criminal law, unless the
director had reasonable cause to believe his conduct was lawful or had
no reasonable cause to believe his conduct was unlawful; (2) a
transaction from which the director derived an improper personal
benefit, either directly or indirectly; (3) a circumstance under which
the liability provisions regarding unlawful distributions are
applicable; (4) in a proceeding by or in the right of someone other than
the corporation or a shareholder, recklessness or an act or omission
which was committed in bad faith or with malicious purpose or in a
manner exhibiting wanton and willful disregard of human rights, safety
or property.
Articles of Incorporation of the Registrant
The Articles of Incorporation of the Registrant (the "Articles")
provide that, to the fullest extent permitted by applicable law, as
amended from time to time, the Registrant will indemnify any person who
is or was a party or is threatened to be made a party to an action, suit
or proceeding (whether civil, criminal, administrative or investigative)
by reason of the fact that such person is or was a director, officer,
employee or agent of the Registrant or serves or served any other
enterprise at the request of the Registrant. This indemnification
includes the right to advancement of expenses when allowed pursuant to
applicable law.
In addition, the Articles provide that a director of the Registrant
shall not be personally liable to the Registrant or its shareholders for
monetary damages for breach of the director's fiduciary duty. However,
the Articles do not eliminate or limit the liability of a director for
any of the following reasons: (i) a breach of the director's duty of
loyalty to the Registrant or its shareholders; (ii) acts or omissions
not in good faith or that involve intentional misconduct or knowing
violation of law; (iii) a violation under Section 607.0834 of the FBCA
(which imposes liability upon directors for unlawful distributions);
(iv) a transaction from which the director derived an improper personal
benefit; or (v) an act or omission occurring before the effective date
of the Articles.
<PAGE>
Page 25
Indemnification
The Registrant has entered into or intends to enter into
Indemnification Agreements with its directors (collectively, the
"Agreements") which provide that each director is entitled to
indemnification to the fullest extent permitted by applicable law. Such
indemnification will cover all expenses, liabilities, judgments
(including punitive and exemplary damages), penalties, fines (including
excise taxes relating to employee benefit plans and civil penalties) and
amounts paid in settlement which are incurred or imposed upon the
director if the director is a party or threatened to be made a party to
any threatened, pending or completed action, suit or proceeding of any
kind, whether civil, criminal, administrative or investigative
(including actions by or in the right of the Registrant and any
preliminary inquiry or claim by any person or authority), by reason of
the fact that the director is or was a director, officer, employee or
agent of the Registrant or is or was serving at the Registrant's request
as a director, officer, employee or agent of another corporation
(including a subsidiary), partnership, joint venture, trust or other
enterprise against liability incurred in connection with such
proceeding, including any appeal thereof (collectively, the "Covered
Matters"). Pursuant to the Agreements, the directors are presumed to be
entitled to indemnification irrespective of whether the Covered Matter
involves allegations of intentional misconduct, alleged violations of
Section 16(b) of the Exchange Act, alleged violations of Section 10(b)
of the Exchange Act (including Rule 10b-5 thereunder), breach of the
director's fiduciary duties (including duties of loyalty or care) or any
other claim.
In addition to the foregoing, the Company maintains a director and
officer liability insurance policy insuring directors and officers of
the Registrant against certain liabilities.
Item 16. Exhibits.
See the Exhibit Index included immediately preceding the Exhibits
to this Registration Statement, which is incorporated herein by
reference.
Item 17. Undertakings.
The 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:
<PAGE>
Page 26
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933, as amended (the "Securities
Act");
(ii) To reflect in the prospectus any facts or events
arising after the effective date of this 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 this 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; and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in this Registration
Statement or any material change to such information in this
Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the information required to be included in a post- effective amendment
by those paragraphs is contained in periodic reports filed by the
Company pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") that are
incorporated by reference in this Registration Statement.
(2) That, for the purposes of determining any liability under
the Securities Act, each 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 the 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.
The Registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act, each filing of the Registrant's
annual report pursuant to Section 13(a) or 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 this Registration Statement shall be deemed
<PAGE>
Page 27
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at the time shall be deemed
to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of
prospectus filed as part of this Registration Statement in reliance upon
Rule 430A and contained in a form of prospectus filed by the Company
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; and
(2) For purposes of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
<PAGE>
Page 28
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and
has duly caused this Amendment No. 1 to the Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Boca Raton, State of Florida, on this 20th day of January,
1998.
THE PANDA PROJECT, INC.
By: /s/ Stanford W. Crane, Jr.
--------------------------
Stanford W. Crane, Jr.
President
<PAGE>
Page 29
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Stanford W. Crane, Jr.
- ---------------------- Chief Executive ) January 20, 1998
Stanford W. Crane, Jr. Officer, President )
and Director )
(Principal Executive )
Officer) )
/s/ C. Daryl Hollis )
- --------------------- Executive Vice ) January 20, 1998
C. Daryl Hollis President and )
Chief Financial )
Officer (Principal )
Financial and )
Accounting Officer) )
/s/ James T.A. Wooder )
- ---------------------- Director ) January 20, 1998
James T. A. Wooder )
)
)
/s/ Claud L. Gingrich )
- ---------------------- Director ) January 20, 1998
Claud L. Gingrich )
)
/s/ Rao R. Tummala )
- ---------------------- Director ) January 20, 1998
Rao R. Tummala )
<PAGE>
Page 30
EXHIBIT INDEX
-------------
Exhibit Description of Exhibit Page
3.1 -- Amended and Restated Articles of
Incorporation of the Company,
as amended +
3.2 -- Amended and Restated By-Laws of the
Company +
4.1 -- Specimen Certificate of Common Stock of
the Company (filed as Exhibit 4.1 to the
Company's Registration Statement on
Form SB-2 (File No. 33-76694-A)) * +
5.1 -- Opinion of Holland & Knight +
23.1 -- Consent of Holland & Knight (included in
Exhibit 5.1) +
23.2 -- Consent of Price Waterhouse LLP
24.1 -- Power of Attorney +
- --------------------
* Incorporated herein by reference.
+ Previously filed.
<PAGE>
Exhibit 23.2
Consent of Independent Certified Public Accounts
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Amendment No. 1 to the Registration Statement
of Form S-3 of our report dated May 22, 1997, except as to Note 16,
which is as of June 23, 1997, appearing of page F-2 of The Panda Project
Inc.'s Annual Report on Form 10-K for the year ended March 31, 1997. We
also consent to the reference to us under the heading "Experts" in such
Prospectus.
/s/ PRICE WATERHOUSE LLP
--------------------
Price Waterhouse LLP
Fort Lauderdale, Florida
January 20, 1998
