As filed with the Securities and Exchange Commission on July 31, 1997
Registration No. 333-30473
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
AMENDMENT No. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
__________________
P-COM, INC.
(Exact name of registrant as specified in its charter)
Delaware 77-0289371
(State of Incorporation) (I.R.S. Employer
Identification No.)
3175 S. Winchester Boulevard
Campbell, California 95008
(408) 866-3666
(Address and telephone number of principal executive offices)
George P. Roberts
Chairman of the Board and Chief Executive Officer
P-Com, Inc.
3175 S. Winchester Boulevard
Campbell, California 95008
(408) 866-3666
(Name, address and telephone number of agent for service)
__________________
Copies to:
Warren T. Lazarow, Esq.
H. Richard Hukari, Esq.
Michael C. Doran, Esq.
Brobeck, Phleger & Harrison LLP
Two Embarcadero Place, 2200 Geng Road
Palo Alto, California 94303
Approximate date of commencement of proposed sale to the public:
As soon as practicable after this Amendment No. 1 to 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. [_]
If any of the securities being registered on this form are
to be offered on a delayed or continuous basis pursuant to
Rule 415 under the Securities Act of 1933, other than securities
offered only in connection with dividend or interest reinvestment
plans, check the following box. [X]
If this Form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities Act,
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, check the following box. [_]
<TABLE>
CALCULATION OF REGISTRATION FEE
<S> <C> <C> <C> <C>
===============================================================================================================
Title of Each Class of Amount to be Proposed Maximum Proposed Maximum Amount of
Securities to be Registered Registered Offering Price Per Aggregate Offering Registration
Share(1) Price(1) Fee (1)
- ---------------------------------------------------------------------------------------------------------------
Common Stock, $0.0001 par value 1,131,455 $ 33.19 $ 37,552,991.45 $ 11,379.69
===============================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the
amount of the registration fee pursuant to Rule 457(c) based
on a per share price of $33.19, the average of the high and
low sale prices per share of the Company's Common Stock on
June 27, 1997. Of the total filing fee of $ 11,379.69, $ 11,208.26
was paid via wire transfer on June 27, 1997. The balance of $ 171.43
was paid via wire transfer on June 30, 1997.
The registrant hereby amends this Amendment No. 1 to
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 Amendment
No. 1 to Registration Statement shall thereafter become effective
in accordance with Section 8(a) of the Securities Act of 1933 or
until the Amendment No. 1 to Registration Statement shall become
effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
Cross-Reference Sheet Showing Location in Prospectus
of Information Required by Items of Form S-3
Form S-3 Registration Statement Location in Prospectus
Item and Heading
------------------------------- ----------------------
1. Forepart of the Registration Statement Outside Front Cover Page
and Outsid Front Cover Page of Prospectus
2. Inside Front and Outside Back Cover
Pages of Prospectus Inside Front Cover Page
3. Summary Information, Risk Factors and
Ratio of Earnings to Fixed Charges Not Applicable; Risk
Factors; Not Applicable
4. Use of Proceeds Outside Front Cover; Use
of Proceeds
5. Determination of Offering Price Outside Front Cover Page
6. Dilution Not Applicable
7. Selling Security Holders Selling Stockholders
8. Plan of Distribution Outside Front Cover Page;
Plan of Distribution
9. Description of Securities to be Information Incorporated by
Registered Reference
10. Interests of Named Experts and Legal Matters
Counsel
11. Material Changes Not Applicable
12. Incorporation of Certain Information Information Incorporated
by Reference Reference
13. Disclosure of Commission Position on Not Applicable
Indemnification for Securities Act
Liabilities
Prospectus
- ----------
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ 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
Preliminary Prospectus Dated July 31, 1997
P-Com, Inc.
1,131,455 Shares Common Stock
($0.0001 par value per share)
_______________________________
This Prospectus relates to the public offering, which is not
being underwritten, of up to 1,131,455 shares (the "Resale
Shares") of Common Stock, $0.0001 par value per share, of P-Com,
Inc. (referred to herein, together with its majority-owned and
wholly-owned subsidiaries, as "P-Com," the "Company" or the
"Registrant"). The Resale Shares may be offered by certain
stockholders of the Company or by pledgees, donees, transferees
or other successors in interest that receive such shares as a
gift, partnership distribution or other non-sale related transfer
(the "Selling Stockholders"). The Resale Shares were received by
the Selling Stockholders in connection with the acquisition of
the assets of Columbia Spectrum Management, LP ("CSM") pursuant
to an Asset Purchase Agreement dated February 12, 1997 and the
acquisition of all of the outstanding securities of Control
Resources Corporation ("CRC") pursuant to an Agreement and Plan
of Reorganization dated April 14, 1997 (the "Acquisitions"). See
"Recent Developments -- The Acquisitions." All of the Resale
Shares were issued pursuant to an exemption from the registration
requirements of the Securities Act of 1933, as amended (the
"Securities Act"), provided by Section 4(2) thereof. The Resale
Shares are being registered by the Company pursuant to
registration rights agreements with the Selling Stockholders. See
the "Plan of Distribution" section herein.
The Resale Shares may be offered by the Selling Stockholders from
time to time in transactions on the Nasdaq National Market, in
privately negotiated transactions, or by a combination of such
methods of sale, at fixed prices that may be changed, at market
prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling
Stockholders may effect such transactions by selling the Resale
Shares to or through broker-dealers and such broker-dealers may
receive compensation in the form of discounts, concessions or
commissions from the Selling Stockholders or the purchasers of
the Resale Shares for whom such broker-dealers may act as agent
or to whom they sell as principal or both (which compensation to
a particular broker-dealer might be in excess of customary
commissions). See "Plan of Distribution."
The Company will not receive any of the proceeds from the sale of
the Resale Shares by the Selling Stockholders. The Company has
agreed to bear certain expenses in connection with the
registration and sale of the Resale Shares being offered by the
Selling Stockholders.
The Company intends that this registration statement will remain
effective until no later than May 29, 1998. On July 28, 1997 the
last reported sale price for the Common Stock, as reported on The
Nasdaq National Market, was $37.50 per share. The Company's
Common Stock is currently quoted on Nasdaq under the symbol
"PCMS."
_______________________________
THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE OF RISK.
SEE "RISK FACTORS" BEGINNING ON PAGE 5.
_______________________________
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 , 1997
No person has been authorized to give any information or to
make any representations other than those contained in this
Prospectus in connection with the offering made hereby, and if
given or made, such information or representations must not be
relied upon as having been authorized by the Company or by any
other person. Neither the delivery of this Prospectus nor any
sale made hereunder shall, under any circumstances, create any
implication that information herein is correct as of any time
subsequent to the date hereof. This Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy
any security other than the securities covered by this
Prospectus, nor does it constitute an offer to or solicitation of
any person in any jurisdiction in which such offer or
solicitation may not lawfully be made.
AVAILABLE INFORMATION
P-Com is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act"),
and, in accordance therewith, files reports, proxy and
information statements and other information with the Securities
and Exchange Commission (the "Commission"). Such reports, proxy
and information statements and other information filed by the
Company with the Commission can be inspected and copied at the
public reference facilities maintained by the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, and the following regional offices of the Commission:
Seven World Trade Center, Suite 1300, New York, New York 10048
and Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such material may also be
obtained from the Public Reference Section of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549, upon payment of
prescribed rates. In addition, the Commission maintains a Web
site at http://www.sec.gov that contains P-Com's reports, proxy
and information statements and other information that have been
filed since P-Com began to file electronically with the
Commission in August 1996. The Common Stock of the Company is
quoted on the Nasdaq National Market, and such material may also
be inspected at the offices of Nasdaq Operations, 1735 K Street,
N.W., Washington, D.C. 20006.
This Prospectus does not contain all the information set forth
in the Registration Statement on Form S-3 (the "Registration
Statement") of which this Prospectus is a part, including
exhibits set forth therein or incorporated by reference thereto,
which has been filed electronically with the Commission under the
Securities Act of 1933, as amended (the "Act") Statements made in
this Prospectus as to the contents of any referenced contract,
agreement or other document are not necessarily complete, and
each such statement shall be deemed qualified in its entirety by
reference thereto. Copies of the Registration Statement and the
exhibits and schedules thereto may be obtained, upon payment of
the fee prescribed by the Commission, or may be examined without
charge at the office of the Commission or at the Commission's Web
site.
INFORMATION INCORPORATED BY REFERENCE
The following documents filed by the Company with the
Commission (File No. 0-25356) pursuant to the 1934 Act are
incorporated by reference in this Prospectus:
1. The Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996;
2. The Company's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1997;
3. The Company's Current Report on Form 8-K filed on
March 10, 1997, the Company's Current Report on Form 8-
K filed on March 21, 1997, the Company's Current Report
on Form 8-K/A filed on May 21, 1997, the Company's
Current Report on Form 8-K filed on June 13, 1997, the
Company's Current Report on Form 8-K/A filed on
June 26, 1997 and the Company's Current Report on
Form 8-K/A filed on June 27, 1997;
4. The description of the Company's Common Stock
contained in the Company's Registration Statement on
Form 8-A filed with the Commission on January 12, 1995,
as amended on February 16, 1995; and
5. All other documents filed by the Company pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the 1934 Act
subsequent to the date of this Prospectus but prior to
the termination of the offering of the Shares.
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 any other subsequently filed document that also is
incorporated herein modifies or replaces such statement. Any
statement so modified or superseded shall not be deemed, in its
unmodified form, to constitute a part of this Prospectus or such
Registration Statement.
Upon written or oral request, the Company will provide without
charge to each person to whom a copy of the Prospectus is
delivered a copy of the documents incorporated by reference
herein (other than exhibits to such documents unless such
exhibits are specifically incorporated by reference therein).
Requests should be submitted in writing or by telephone at (408)
866-3666 to George P. Roberts, Chairman of the Board and Chief
Executive Officer, P-C, Inc., at the principal executive offices
of the Company, 3175 S. Winchester Boulevard, Campbell,
California 95008.
THE COMPANY
The following section contains forward-looking statements
which involve risks and uncertainties. The Company's actual
results could differ materially from those anticipated in these
forward-looking statements as a result of certain factors,
including those set forth under "Risk Factors" and elsewhere in
this Prospectus.
P-Com, Inc. designs, manufactures and markets short-haul
millimeter wave radio systems and spread spectrum microwave radio
systems for use in the worldwide wireless telecommunications and
broadcasting markets. The Company's Tel-Linkr systems are used as
digital links in applications that include interconnecting base
stations and mobile switching centers in microcellular and
personal communications services ("PCN/PCS") networks and
providing local telephone company ("telco") connectivity in the
local loop. The integrated architecture and high software content
of the Company's systems are designed to offer cost-effective,
high-performance products with a high degree of flexibility and
functionality. Additionally, the Company offers turnkey microwave
relocation services to new licensees of radio spectrum who must
first remove existing users from the frequencies before
implementing new systems and provides equipment for network
access and wireline applications. Furthermore, the Company is
currently developing a point-to-multipoint product for use in
both the telecommunications and broadcast industries.
P-Com's Tel-Link wireless radios utilize a common architecture
for systems in multiple millimeter wave and spread spectrum
microwave frequencies including 2.4 GHz, 5.7 GHz, 7 Ghz, 13 GHz,
14 GHz, 15 GHz, 18 Ghz, 23 GHz, 24 GHz, 26 GHz, 38 GHz and 50
GHz. The Company's systems are designed to be highly reliable,
cost effective and simple to install and maintain. Software
embedded in the Company's systems allows the user to easily
configure and adjust system settings such as frequency, power and
capacity with minimal manual tuning and mechanical adjustments.
The Company also markets a full line of Windows-based software
products that are complementary to its systems as sophisticated
diagnostic, maintenance and system configuration tools.
The Company's radio systems are sold internationally through
strategic partners, system providers, original equipment
manufacturers ("OEMs") and distributors as well as directly to
end-users, and domestically primarily through its direct sales
force. The Company's radio system customers include Advanced
Radio Telecom Corp. ("ART"), Bosch Telecom GmbH, Grupo Iusacell
S.A. de C.V., Lucent Technologies, Inc. (including the entities
formerly known as AT&T Network Systems Deutschland GmbH and AT&T
Network Systems Nederland BV), Mercury Communications Ltd.,
Mercury Personal Communications, Norweb plc, Orange Personal
Communications Ltd., Pacific Bell Mobile Services, Itatel S.p.A.
(formerly known as Siemens Telecommunicazioni, S.p.A.), Ericsson,
Ltd., Fujitsu Limited, Northern Telecom, Ltd. and WinStar
Wireless, Inc. ("Winstar"). The Company's customers for microwave
relocation services include Sprint Spectrum, AT&T Wireless,
PrimeCo Personal Communications, BellSouth, Omnipoint and
Intercel.
P-Com received in December 1993 its initial ISO 9001
registration, a standard established by the International
Organization for Standardization that provides a methodology by
which manufacturers can obtain quality certification. In
accordance with ISO 9001 requirements, the Company's ISO 9001
registration was subsequently recertified. The Company also
completed ISO 9001 registration for its United Kingdom sales and
customer support facility and Geritel facility in Italy in 1996.
The Company is in the process of obtaining ISO 9001 registration
for its other facilities outside of the United States.
RISK FACTORS
Limited Operating History
The Company was founded in August 1991 and was in the
development stage until October 1993 when it began commercial
shipments of its first product. From inception to the end of the
first quarter of fiscal 1997, the Company generated a cumulative
net profit of approximately $4.1 million. From October 1993
through March 31, 1997, the Company generated sales of
approximately $188.3 million, of which $135.6 million, or 72% of
such amount, was generated in the year ended December 31, 1996
and the first quarter of 1997. The Company does not believe
recent growth rates are indicative of future operating results.
Due to the Company's limited operating history and limited
resources, among other factors, there can be no assurance that
profitability or significant revenues on a quarterly or annual
basis will occur in the future. During 1996 and the first quarter
of 1997, both the Company's sales and operating expenses
increased more rapidly than the Company had anticipated. There
can be no assurance that the Company's revenues will continue to
remain at or increase from the levels experienced in 1996 or in
the first quarter of 1997 or that sales will not decline. The
Company intends to continue to invest significant amounts in its
operations, particularly to support product development and the
marketing and sales of recently introduced products, and
operating expenses will continue to increase significantly in
absolute dollars. If the Company's sales do not correspondingly
increase, the Company's results of operations would be materially
adversely affected. Accordingly, there can be no assurance that
the Company will achieve profitability in future periods. The
Company is subject to all of the risks inherent in the operation
of a new business enterprise, and there can be no assurance that
the Company will be able to successfully address these risks.
Significant Customer Concentration
To date, approximately forty-five customers have accounted for
all of the Company's sales. For 1996, six customers accounted for
79% of the Company's sales, and as of December 31, 1996, six
customers accounted for most of the Company's backlog scheduled
for shipment in the twelve months subsequent to December 31,
1996. During the first quarter of 1997, five customers accounted
for 64% of the Company's sales, and as of March 31, 1997, six
customers accounted for 90% of the Company's backlog scheduled
for shipment in the twelve months subsequent to March 31, 1997.
The Company anticipates that it will continue to sell its
products and services to a changing but still relatively small
group of customers. Some companies implementing new networks are
at early stages of development and may require additional capital
to fully implement their planned networks. The Company's ability
to achieve sales in the future will depend in significant part
upon its ability to obtain and fulfill orders from, maintain
relationships with and provide support to existing and new
customers, to manufacture systems on a timely and cost-effective
basis and to meet stringent customer performance and other
requirements and shipment delivery dates, as well as the
condition, working capital availability and success of its
customers. As a result, any cancellation, reduction or delay in
orders by or shipments to any customer, as a result of
manufacturing or supply difficulties or otherwise, or the
inability of any customer to finance its purchases of the
Company's products or services may materially adversely affect
the Company's business, financial condition and results of
operations. In addition, financial difficulties of any existing
or potential customers may limit the overall demand for the
Company's products and services (for example, certain potential
customers in the telecommunications industry have been reported
to have undergone recent financial difficulties and may therefore
limit their future orders). There can be no assurance that the
Company's sales will increase in the future or that the Company
will be able to support or attract customers.
Significant Fluctuations in Results of Operations
The Company has experienced and may in the future continue to
experience significant fluctuations in sales, gross margins and
operating results. The procurement process for most of the
Company's current and potential customers is complex and lengthy,
and the timing and amount of sales is difficult to predict
reliably. In addition, a single customer's order scheduled for
shipment in a quarter can represent a significant portion of the
Company's potential sales for such quarter. There can be no
assurance that the Company will be able to obtain such large
orders from single customers in the future. The Company has at
times failed to receive expected orders, and delivery schedules
have been deferred as a result of changes in customer
requirements, among other factors. As a result, the Company's
operating results for a particular period have in the past been
and may in the future be materially adversely affected by a
delay, rescheduling or cancellation of even one purchase order.
Much of the anticipated growth in telecommunications
infrastructure results from the entrance of new service
providers, many of whom do not have the financial resources of
existing service providers. To the extent these new service
providers are unable to adequately finance their operations, they
may cancel orders. Moreover, purchase orders are often received
and accepted substantially in advance of shipment, and the
failure to reduce actual costs to the extent anticipated or an
increase in anticipated costs before shipment could materially
adversely affect the gross margins for such order, and as a
result, the Company's results of operations. Moreover, most of
the Company's backlog scheduled for shipment in the twelve months
subsequent to March 31, 1997 can be canceled since orders are
often made substantially in advance of shipment, and the
Company's contracts typically provide that orders may be canceled
with limited or no penalties. As a result, backlog is not
necessarily indicative of future sales for any particular period.
Furthermore, most of the Company's sales in recent quarters have
been realized near the end of each quarter. Accordingly, a delay
in a shipment near the end of a particular quarter, as the
Company has been experiencing recently, due to, for example, an
unanticipated shipment rescheduling, a cancellation or deferral
by a customer, competitive or economic factors, unexpected
manufacturing or other difficulties, delays in deliveries of
components, subassemblies or services by suppliers, or the
failure to receive an anticipated order, may cause sales in a
particular quarter to fall significantly below the Company's
expectations and may materially adversely affect the Company's
operating results for such quarter.
In connection with its efforts to ramp-up production of
recently introduced products, the Company expects to continue to
make substantial capital investments in equipment, recruit and
train additional personnel and possibly invest in additional
manufacturing facilities. The Company anticipates that these
expenditures may be made in advance of, and in anticipation of,
increased sales and, therefore, that its gross margins will be
adversely affected from time-to-time due to short-term
inefficiencies associated with addition of equipment, personnel
or facilities, and that each cost category may increase as a
percentage of revenues from time-to-time on a periodic basis. As
a result, the Company's operating results will vary.
A large portion of the Company's expenses are fixed and
difficult to reduce should revenues not meet the Company's
expectations, thus magnifying the material adverse effect of any
revenue shortfall. Furthermore, announcements by the Company or
its competitors of new products and technologies could cause
customers to defer or cancel purchases of the Company's systems,
which would materially adversely affect the Company's business,
financial condition and results of operations. Additional factors
that have caused and may continue to cause the Company's sales,
gross margins and results of operations to vary significantly
from period to period include: new product introductions and
enhancements, including related costs; the Company's ability to
manufacture and produce sufficient volumes of systems and meet
customer requirements; manufacturing capacity, efficiencies and
costs; mix of systems and related software tools sold; operating
and new product development expenses; product discounts; accounts
receivable collection, in particular those acquired in recent
acquisitions; changes in pricing by the Company, its customers or
suppliers; inventory obsolescence; natural disasters;
seasonality; market acceptance and the timing of availability of
new products by the Company or its customers; acquisitions,
including costs and expenses; usage of different distribution and
sales channels; fluctuations in foreign currency exchange rates;
delays or changes in regulatory approval of its systems; warranty
and customer support expenses; customization of systems; and
general economic and political conditions. In addition, the
Company's results of operations have been and will continue to be
influenced significantly by competitive factors, including the
pricing and availability of, and demand for, competitive
products. The Company expects to continue to expend significant
resources with respect to the development, ramp-up of production
and anticipated commercial shipments of its newest products and
expects its gross margins to be adversely affected due to the
start-up inefficiencies associated with these products, among
many other factors. All of the above factors are difficult for
the Company to forecast, and these or other factors could
materially adversely affect the Company's business, financial
condition and results of operations. As a result, the Company
believes that period-to-period comparisons are not necessarily
meaningful and should not be relied upon as indications of future
performance. Due to all of the foregoing factors, it is likely
that in some future quarter the Company's operating results will
be below the expectations of public market analysts and
investors. In such event, the price of the Company's Common Stock
may be materially adversely affected.
Dependence on Contract Manufacturers; Reliance on Sole or Limited
Sources of Supply
The Company's internal manufacturing capacity is very limited.
The Company utilizes contract manufacturers such as Remec, Inc.,
Sanmina Corporation, SPC Electronics Corp., GSS Array Technology,
Celeritek, Inc. and Senior Systems Technology Inc. to produce its
systems, components and subassemblies and expects to rely
increasingly on these and other manufacturers in the future. The
Company also relies on outside vendors to manufacture certain
other components and subassemblies. Certain necessary components,
subassemblies and services necessary for the manufacture of the
Company's systems are obtained from a sole supplier or a limited
group of suppliers. In particular, ELTEL, MilliWave, Scientific
Atlanta and Xilinx, Inc. each are sole source suppliers for
critical components used in the Company's radio systems. There
can be no assurance that the Company's internal manufacturing
capacity and that of its contract manufacturers will be
sufficient to fulfill the Company's orders. Failure to
manufacture, assemble and ship systems and meet customer demands
on a timely and cost-effective basis could damage relationships
with customers and have a material adverse effect on the
Company's business, financial condition and operating results.
The Company's reliance on contract manufacturers and on sole
suppliers or a limited group of suppliers and the Company's
increasing reliance on contract manufacturers and suppliers
involves several risks, including a potential inability to obtain
an adequate supply of finished radio systems and required
components and subassemblies, and reduced control over the price,
timely delivery, reliability and quality of finished radio
systems, components and subassemblies. The Company does not have
long-term supply agreements with most of its manufacturers or
suppliers. Manufacture of the Company's radio systems and certain
of these components and subassemblies is an extremely complex
process, and the Company has from time to time experienced and
may in the future continue to experience delays in the delivery
of and quality problems with radio systems and certain components
and subassemblies from vendors. Certain of the Company's
suppliers have relatively limited financial and other resources.
Any inability to obtain timely deliveries of components and
subassemblies of acceptable quality or any other circumstance
that would require the Company to seek alternative sources of
supply, or to manufacture its finished radio systems or such
components and subassemblies internally, could delay the
Company's ability to ship its systems, which could damage
relationships with current or prospective customers and have a
material adverse effect on the Company's business, financial
condition and operating results.
No Assurance of Successful Expansion of Operations; Management of
Growth
Recently, the Company has significantly increased the scale of
its operations to support the increases in its sales levels that
have occurred and to address critical infrastructure and other
requirements. This increase has included the leasing of new
space, the opening of branch offices in the United Kingdom,
Germany and Singapore, the acquisition of a majority interest in
Geritel S.p.A. ("Geritel"), and the acquisitions of Atlantic
Communication Sciences, Inc. ("ACS"), Technosystem S.p.A.
("Technosystem"), CSM and CRC, significant investments in
research and development to support product development,
including the new products recently introduced, and the hiring of
additional personnel, including in sales and marketing,
manufacturing and operations and finance and has resulted in
significantly higher operating expenses. The Company anticipates
that its operating expenses will continue to increase
significantly. If the Company's sales do not correspondingly
increase, the Company's results of operations would be materially
adversely affected. See "--Limited Operating History." Expansion
of the Company's operations has caused and is continuing to
impose a significant strain on the Company's management,
financial, manufacturing and other resources. The Company's
ability to manage the recent and any possible future growth,
should it occur, will depend upon a significant expansion of its
manufacturing, accounting and other internal management systems
and the implementation and subsequent improvement of a variety of
systems, procedures and controls. In addition, the Company must
establish and improve a variety of systems, procedures and
controls to more efficiently coordinate its activities in its
acquired companies in Rome and Milan, Italy, France, Poland, New
Jersey, Florida and Virginia and the various locations where the
acquired businesses perform their operations. In addition, the
Company must establish and improve a variety of systems,
procedures and controls to more effectively coordinate its
activity in acquired or to be acquired companies (including their
facilities) in Italy, France, Poland, New Jersey, Florida and
Virginia and their respective offices and customer bases. There
can be no assurance that significant problems in these areas will
not occur. Any failure to expand these areas and implement and
improve such systems, procedures and controls in an efficient
manner at a pace consistent with the Company's business could
have a material adverse effect on the Company's business,
financial condition and results of operations. In particular, the
Company must successfully manage the transition to higher
internal and external volume manufacturing, including the
establishment of adequate facilities, the control of overhead
expenses and inventories, the development, introduction,
marketing and sales of new products, the management and training
of its employee base and the monitoring of its third party
manufacturers and suppliers. Although the Company has
substantially increased the number of its manufacturing personnel
and significantly expanded its internal and external
manufacturing capacity, there can be no assurance that the
Company will not experience manufacturing or other delays or
problems that could materially adversely affect the Company's
business, financial condition or results of operations.
In this regard, any significant sales growth will be dependent
in significant part upon the Company's expansion of its
marketing, sales, manufacturing and customer support
capabilities. This expansion will continue to require significant
expenditures to build the necessary infrastructure. There can be
no assurance that the Company's attempts to expand its marketing,
sales, manufacturing and customer support efforts will be
successful or will result in additional sales or profitability in
any future period. As a result of the expansion of its operations
and the significant increase in its operating expenses, as well
as the difficulty in forecasting revenue levels, the Company may
continue to experience significant fluctuations in its revenues,
costs, and gross margins, and therefore its results of
operations.
The Company has pursued, and will continue to pursue, growth
opportunities through internal development and acquisitions of
complementary businesses and technologies. The Company is unable
to predict whether and when any prospective acquisition candidate
will become available or the likelihood that any acquisition will
be completed. The Company competes for acquisition and expansion
opportunities with many entities that have substantially greater
resources than the Company. In addition, acquisitions may involve
difficulties in the retention of personnel, diversion of
management's attention, unexpected legal liabilities, and tax and
accounting issues. There can be no assurance that the Company
will be able to successfully identify suitable acquisition
candidates, complete acquisitions, integrate acquired businesses
into its operations, or expand into new markets. Once integrated,
acquired businesses may not achieve comparable levels of
revenues, profitability, or productivity as the existing business
of the Company or otherwise perform as expected. The occurrence
of any of these events could have a material adverse effect on
the Company's business, financial condition and results of
operations.
Declining Average Selling Prices
The Company believes that average selling prices and gross
margins for its systems will decline in the long term as such
systems mature, as volume price discounts in existing and future
contracts take effect and as competition intensifies, among other
factors. To offset declining average selling prices, the Company
believes that it must successfully introduce and sell new systems
on a timely basis, develop new products that incorporate advanced
software and other features that can be sold at higher average
selling prices and reduce the costs of its systems through
contract manufacturing, design improvements and component cost
reduction, among other actions. To the extent that new products
are not developed in a timely manner, do not achieve customer
acceptance or do not generate higher average selling prices, and
the Company is unable to offset declining average selling prices,
the Company's gross margins will decline, and such decline will
have a material adverse effect on the Company's business,
financial condition and results of operations.
Trade Account Receivables
The Company is subject to credit risk in the form of trade
account receivables. The Company may in certain circumstances be
unable to enforce a policy of receiving payment within a limited
number of days of issuing bills, especially in the case of
customers who are in the early phases of business development.
In addition, many of the Company's foreign customers are
accustomed to paying their suppliers on longer terms than those
typically existing in the United States. See "-- International
Operations; Risks of Doing Business in Developing Countries."
Generally, the Company does not require collateral or other
security to support customer receivables.
No Assurance of Product Quality, Performance and Reliability
The Company has limited experience in producing and
manufacturing its systems and contracting for such manufacture.
The Company's customers require very demanding specifications for
quality, performance and reliability. There can be no assurance
that problems will not occur in the future with respect to the
quality, performance and reliability of the Company's systems or
related software tools. If such problems occur, the Company could
experience increased costs, delays in or cancellations or
reschedulings of orders or shipments, delays in collecting
accounts receivable and product returns and discounts, any of
which would have a material adverse effect on the Company's
business, financial condition or results of operations. In
addition, in order to maintain its ISO 9001 registration, the
Company periodically must undergo a recertification assessment.
Failure to maintain such registration could materially adversely
affect the Company's business, financial condition and results of
operations. The Company completed ISO 9001 registration for its
United Kingdom sales and customer support facility and its
Geritel facility in Italy in 1996, and other facilities will also
be attempting ISO 9001 registration. There can be no assurance
that such registration will be achieved.
Acquisitions
In the future, the Company will pursue acquisitions of
complementary product lines, technologies or businesses. Future
acquisitions by the Company could result in potentially dilutive
issuances of equity securities, the incurrence of debt and
contingent liabilities and amortization expenses related to
goodwill and other intangible assets, which could materially
adversely affect any Company profitability. All of the Company's
acquisitions to date, except CRC, are being accounted for under
the purchase method of accounting and as a result a significant
amount of goodwill is being amortized as set forth in the
Company's Financial Statements. In addition, acquisitions, such
as Geritel, ACS, Technosystem, CSM and CRC, involve numerous
risks, including difficulties in the assimilation of the
operations, technologies and products of the acquired companies,
the diversion of management's attention from other business
concerns, risks of entering markets in which the Company has no
or limited direct prior experience, operating companies in
different geographical locations with different cultures, and the
potential loss of key employees of the acquired company. In the
event that such an acquisition does occur, however, there can be
no assurance as to the effect thereof on the Company's business,
financial condition or operating results.
Uncertainty of Market Acceptance
The future operating results of the Company depend to a
significant extent upon the continued growth and increased
availability and acceptance of microcellular, PCN/PCS and
wireless local loop access telecommunications services in the
United States and internationally. There can be no assurance that
the volume and variety of wireless telecommunications services or
the markets for and acceptance of such services will continue to
grow, or that such services will create a demand for the
Company's systems. Because these markets are relatively new, it
is difficult to predict which segments of these markets will
develop and at what rate these markets will grow, if at all. If
the short-haul millimeter wave or spread spectrum microwave
wireless radio market and related services for the Company's
systems fails to grow, or grows more slowly than anticipated, the
Company's business, financial condition and results of operations
would be materially adversely affected. Certain sectors of the
communications market will require the development and deployment
of an extensive and expensive communications infrastructure. In
particular, the establishment of PCN/PCS networks will require
very large capital expenditures. There can be no assurance that
communications providers have the ability to, or will, make the
necessary investment in such infrastructure or that the creation
of this infrastructure will occur in a timely manner. Moreover, a
potential application of the Company's technology, use of the
Company's systems in conjunction with the provision by wireless
telecommunications service providers of alternative wireless
access in competition with the existing wireline local exchange
providers, is dependent on the pricing of wireless
telecommunications services at rates competitive with those
charged by wireline telephone companies. Rates for wireless
access are currently substantially higher than those charged by
wireline companies, and there can be no assurance that rates for
wireless access will generally be competitive with rates charged
by wireline companies. If wireless access rates are not
competitive, consumer demand for wireless access will be
materially adversely affected. If the Company allocates its
resources to any market segment that does not grow, it may be
unable to reallocate its resources to other market segments in a
timely manner, which may curtail or eliminate its ability to
enter such market segments.
To date, most of the Company's sales have been to customers
located outside the United States. In addition, in 1996, the
Company acquired a 51% interest in Geritel and in February 1997,
a 100% interest in Technosystem. Both companies are located in
Europe and sell products primarily to customers in Europe. The
Company's future results of operations will be dependent in
significant part on its ability to penetrate the
telecommunications market in the United States and foreign
countries in which the Company has not yet established a
meaningful presence. There can be no assurance that the Company
will be successful in penetrating these additional markets.
Certain of the Company's current and prospective customers are
currently utilizing competing technologies such as fiber optic
and copper cable, particularly in the local loop access market.
To successfully displace existing technologies, the Company must,
among many actions, offer systems with superior price/performance
characteristics and extensive customer service and support,
supply such systems on a timely and cost-effective basis in
sufficient volume to satisfy such prospective customers'
requirements and otherwise overcome any reluctance on the part of
such customers to transition to new technologies. Any delay in
the adoption of the Company's systems may result in prospective
customers utilizing alternative technologies in their next
generation of systems and networks, which would have a material
adverse effect on the Company's business, financial condition and
results of operations. There can be no assurance that prospective
customers will design their systems or networks to include the
Company's systems, that existing customers will continue to
include the Company's systems in their products, systems or
networks in the future, or that the Company's technology will to
any significant extent replace existing technologies and achieve
widespread acceptance in the wireless telecommunications market.
Failure to achieve or sustain commercial acceptance of the
Company's currently available radio systems or to develop other
commercially acceptable radio systems would materially adversely
affect the Company's business, financial condition and results of
operations. In addition, there can be no assurance that industry
technical standards will remain the same or, if emerging
standards become established, that the Company will be able to
conform to these new standards in a timely and cost-effective
manner.
Intensely Competitive Industry
The wireless communications market is intensely competitive.
The Company's wireless-based radio systems compete with other
wireless telecommunications products and alternative
telecommunications transmission media. The Company experiences
intense competition worldwide from a number of leading
telecommunications companies that offer a variety of competitive
products and broader telecommunications product lines, including
Digital Microwave Corporation, California Microwave, Inc.,
Alcatel Network Systems, Philips T.R.T., Adtran, Inc., Western
Multiplex Corporation, Cylink Corporation, Larus Corporation,
Ericsson Limited, Harris Corporation -- Farinon Division and
Nokia Telecommunications, most of which have substantially
greater installed bases, financial resources and production,
marketing, manufacturing, engineering and other capabilities than
the Company. The Company also faces competition from startup
companies. The Company may also face competition in the future
from new market entrants offering competing technologies. In
addition, the Company's current and prospective customers and
partners have developed, are currently developing or could
develop the capability to manufacture products competitive with
those that have been or may be developed or manufactured by the
Company. Certain of such customers and partners have access to
the Company's technology or are granted the right to use the
technology for purposes of manufacturing under defined
circumstances. The Company's future results of operations may
depend in part upon the extent to which these customers elect to
purchase from outside sources rather than develop and manufacture
their own radio systems. Recently, certain of the Company's
competitors have announced the introduction of competitive
products, including related software tools, and the acquisition
of other competitors and competitive technologies. Within the
near future, the Company expects its competitors to continue to
improve the performance and lower the price of their current
products and to introduce new products or new technologies that
provide added functionality and other features, that may or may
not be comparable to the Company's products, which could cause a
significant decline in sales or loss of market acceptance of the
Company's systems, or make the Company's systems or technologies
obsolete or noncompetitive. The Company expects to continue to
experience significant price competition that may materially
adversely affect its gross margins and its business, financial
condition and results of operations. The Company believes that to
be competitive, it will continue to be required to expend
significant resources on, among other items, new product
development and enhancements. There can be no assurance that the
Company will be able to compete successfully in the future.
Requirement for Response to Rapid Technological Change and
Requirement for Frequent New Product Introductions
The wireless communications market is subject to rapid
technological change, frequent new product introductions and
enhancements, product obsolescence, changes in end-user
requirements and evolving industry standards. The Company's
ability to be competitive in this market will depend in
significant part upon its ability to successfully develop,
introduce and sell new systems and enhancements and related
software tools on a timely and cost-effective basis that respond
to changing customer requirements. Recently, the Company has been
developing spread spectrum and point-to-multipoint radio systems.
Any success of the Company in developing new and enhanced systems
and related software tools will depend upon a variety of factors,
including new product selection, integration of the various
elements of its complex technology, timely and efficient
completion of system design, timely and efficient implementation
of manufacturing and assembly processes and its cost reduction
program, development and completion of related software tools,
system performance, quality and reliability of its systems and
development and introduction of competitive systems by
competitors. The Company has experienced and may continue to
experience delays from time to time in completing development and
introduction of new systems and related software tools, including
products acquired in the Acquisitions. Moreover, there can be no
assurance that the Company will be successful in selecting,
developing, manufacturing and marketing new systems or
enhancements or related software tools. There can be no assurance
that errors will not be found in the Company's systems after
commencement of commercial shipments, which could result in the
loss of or delay in market acceptance. The inability of the
Company to introduce in a timely manner new systems or
enhancements or related software tools that contribute to sales
could have a material adverse effect on the Company's business,
financial condition and results of operations.
International Operations; Risks of Doing Business in Developing
Countries
Most of the Company's sales to date have been made to customers
located outside of the United States. In addition, in 1996, the
Company acquired a 51% interest in Geritel and in February 1997,
a 100% interest in Technosystem which are located in Europe and
will sell their products primarily to customers in Europe, the
Middle East and Africa. The Company anticipates that
international sales will continue to account for at least a
majority of its sales for the foreseeable future. The Company's
international sales may be denominated in foreign or United
States currencies. A decrease in the value of foreign currencies
relative to the United States dollar could result in losses from
transactions denominated in foreign currencies. With respect to
the Company's international sales that are United States dollar-
denominated, such a decrease could make the Company's systems
less price-competitive and could have a material adverse effect
upon the Company's business, financial condition and results of
operations. Although the Company seeks to mitigate its currency
exposure through hedging measures, these measures have been and
in the future may be limited in their effectiveness. Additional
risks inherent in the Company's international business activities
include changes in regulatory requirements, costs and risks of
localizing systems in foreign countries, delays in receiving
components and materials, availability of suitable export
financing, timing and availability of export licenses, tariffs
and other trade barriers, political and economic instability,
difficulties in staffing and managing foreign operations,
branches and subsidiaries, including Geritel and Technosystem,
difficulties in managing distributors, potentially adverse tax
consequences, foreign currency exchange fluctuations, the burden
of complying with a wide variety of complex foreign laws and
treaties and the possibility of difficulty in accounts receivable
collections. Many of the Company's customer purchase and other
agreements are governed by foreign laws, which may differ
significantly from U.S. laws. Therefore, the Company may be
limited in its ability to enforce its rights under such
agreements and to collect damages, if awarded. There can be no
assurance that any of these factors will not have a material
adverse effect on the Company's business, financial condition and
results of operations.
International telephone companies are in many cases owned or
strictly regulated by local regulatory authorities. Access to
such markets is often difficult due to the established
relationships between a government owned or controlled telephone
company and its traditional indigenous suppliers of
telecommunications equipment. The successful expansion of the
Company's international operations in certain markets will depend
on its ability to locate, form and maintain strong relationships
with established companies providing communication services and
equipment in targeted regions. The failure to establish regional
or local relationships or to successfully market or sell its
products in international markets could significantly limit the
Company's ability to expand its operations and would materially
adversely affect the Company's business, financial condition and
results of operations. The Company's inability to identify
suitable parties for such relationships, or even if such parties
are identified, to form and maintain strong relationships with
such parties could prevent the Company from generating sales of
its products and services in targeted markets or industries.
Moreover, even if such relationships are established, there can
be no assurance that the Company will be able to increase sales
of its products and services through such relationships.
Some of the Company's potential markets consist of developing
countries that may deploy wireless communications networks as an
alternative to the construction of a limited wired
infrastructure. These countries may decline to construct wireless
telecommunications systems or construction of such systems may be
delayed for a variety of reasons, in which event any demand for
the Company's systems in those countries will be similarly
limited or delayed. In doing business in developing markets, the
Company may also face economic, political and foreign currency
fluctuations that are more volatile than those commonly
experienced in the United States and other areas.
Extensive Government Regulation
Radio communications are subject to extensive regulation by the
United States and foreign laws and international treaties. The
Company's equipment must conform to a variety of domestic and
international requirements. Historically, in many developed
countries, the unavailability of frequency spectrum has inhibited
the growth of wireless telecommunications networks. In order for
the Company to operate in a jurisdiction, it must obtain
regulatory approval for its systems and comply with different
regulations in each jurisdiction. The delays inherent in this
governmental approval process may cause the cancellation,
postponement or rescheduling of the installation of
communications systems by the Company's customers, which in turn
may have a material adverse effect on the sale of systems by the
Company to such customers. The failure to comply with current or
future regulations or changes in the interpretation of existing
regulations could result in the suspension or cessation of
operations. Such regulations or such changes in interpretation
could require the Company to modify its radio systems and incur
substantial costs to comply with such time-consuming regulations
and changes. In addition, the Company is also affected to the
extent that domestic and international authorities regulate the
allocation and auction of the radio frequency spectrum. Equipment
to support new services can be marketed only if permitted by
suitable frequency allocations, auctions and regulations, and the
process of establishing new regulations is complex and lengthy.
To the extent PCS operators and others are delayed in deploying
these systems, the Company could experience delays in orders.
Failure by the regulatory authorities to allocate suitable
frequency spectrum could have a material adverse effect on the
Company's business, financial condition and results of
operations. In addition, delays in the radio frequency spectrum
auction process in the United States could delay the Company's
ability to develop and market equipment to support new services.
These delays could have a material adverse effect on the
Company's business, financial condition and results of
operations.
The regulatory environment in which the Company operates is
subject to significant change. Regulatory changes, which are
affected by political, economic and technical factors, could
significantly impact the Company's operations by restricting
development efforts by the Company and its customers, making
current systems obsolete or increasing the opportunity for
additional competition. Any such regulatory changes could have a
material adverse effect on the Company's business, financial
condition and results of operations. The Company might deem it
necessary or advisable to modify its systems to operate in
compliance with such regulations. Such modifications could be
extremely expensive and time-consuming.
Future Capital Requirements
The Company's future capital requirements will depend upon many
factors, including the development of new radio systems and
related software tools, potential acquisitions, requirements to
maintain adequate manufacturing facilities and contract
manufacturing agreements, the progress of the Company's research
and development efforts, expansion of the Company's marketing and
sales efforts, and the status of competitive products. There can
be no assurance that additional financing will be available to
the Company on acceptable terms, or at all. If additional funds
are raised by issuing equity securities, further dilution to the
existing stockholders will result. If adequate funds are not
available, the Company may be required to delay, scale back or
eliminate its research and development, acquisition or
manufacturing programs or obtain funds through arrangements with
partners or others that may require the Company to relinquish
rights to certain of its technologies or potential products or
other assets. Accordingly, the inability to obtain such financing
could have a material adverse effect on the Company's business,
financial condition and results of operations.
Uncertainty Regarding Protection of Proprietary Rights
The Company attempts to protect its intellectual property
rights through patents, trademarks, trade secrets and a variety
of other measures. However, there can be no assurance that such
measures will provide adequate protection for the Company's trade
secrets or other proprietary information, that disputes with
respect to the ownership of its intellectual property rights will
not arise, that the Company's trade secrets or proprietary
technology will not otherwise become known or be independently
developed by competitors or that the Company can otherwise
meaningfully protect its intellectual property rights. There can
be no assurance that any patent owned by the Company will not be
invalidated, circumvented or challenged, that the rights granted
thereunder will provide competitive advantages to the Company or
that any of the Company's pending or future patent applications
will be issued with the scope of the claims sought by the
Company, if at all. Furthermore, there can be no assurance that
others will not develop similar products or software, duplicate
the Company's products or software or design around the patents
owned by the Company or that third parties will not assert
intellectual property infringement claims against the Company. In
addition, there can be no assurance that foreign intellectual
property laws will adequately protect the Company's intellectual
property rights abroad. The failure of the Company to protect its
proprietary rights could have a material adverse effect on its
business, financial condition and results of operations.
Litigation may be necessary to protect the Company's
intellectual property rights and trade secrets, to determine the
validity of and scope of the proprietary rights of others or to
defend against claims of infringement or invalidity. Such
litigation could result in substantial costs and diversion of
resources and could have a material adverse effect on the
Company's business, financial condition and results of
operations. There can be no assurance that infringement,
invalidity, right to use or ownership claims by third parties or
claims for indemnification resulting from infringement claims
will not be asserted in the future. If any claims or actions are
asserted against the Company, the Company may seek to obtain a
license under a third party's intellectual property rights. There
can be no assurance, however, that a license will be available
under reasonable terms or at all. In addition, should the Company
decide to litigate such claims, such litigation could be
extremely expensive and time consuming and could materially
adversely affect the Company's business, financial condition and
results of operations, regardless of the outcome of the
litigation.
Dependence on Key Personnel
The Company's future operating results depend in significant
part upon the continued contributions of its key technical and
senior management personnel, many of whom would be difficult to
replace. The Company's future operating results also depend in
significant part upon its ability to attract and retain qualified
management, manufacturing, quality assurance, engineering,
marketing, sales and support personnel. Competition for such
personnel is intense, and there can be no assurance that the
Company will be successful in attracting or retaining such
personnel. There may be only a limited number of persons with the
requisite skills to serve in these positions and it may be
increasingly difficult for the Company to hire such personnel
over time. The loss of any key employee, the failure of any key
employee to perform in his or her current position, the Company's
inability to attract and retain skilled employees as needed or
the inability of the officers and key employees of the Company to
expand, train and manage the Company's employee base could
materially adversely affect the Company's business, financial
condition and results of operations.
The Company may experience employee turnover due to several
factors, including an expanding economy within the geographic
area in which the Company maintains its principal business
offices, making it more difficult for the Company to retain its
employees. Due to this and other factors, the Company may
experience high levels of employee turnover, which could
adversely impact the Company's business, financial condition and
results of operations. The Company is presently addressing these
issues and will pursue solutions designed to retain its employees
and to provide performance incentives.
Volatility of Stock Price
The Company's initial public offering ("IPO") was completed in
March 1995, and its follow-on offerings were completed in
August 1995 and May 1996. The market price of the Company's
Common Stock has fluctuated significantly since the Company's
IPO. The Company believes that factors such as announcements of
developments related to the Company's business, announcements of
technological innovations or new products or enhancements by the
Company or its competitors, sales by competitors, including sales
to the Company's customers, sales of the Company's Common Stock
into the public market, including by members of management,
developments in the Company's relationships with its customers,
partners, lenders, distributors and suppliers, shortfalls or
changes in revenues, gross margins, earnings or losses or other
financial results from analysts' expectations, regulatory
developments, fluctuations in results of operations and general
conditions in the Company's market or the markets served by the
Company's customers or the economy could cause the price of the
Company's Common Stock to fluctuate, perhaps substantially. In
addition, in recent years the stock market in general, and the
market for shares of small capitalization and technology stocks
in particular, have experienced extreme price fluctuations, which
have often been unrelated to the operating performance of
affected companies. Many companies in the telecommunications
industry, including the Company, have recently experienced
historic highs in the market price of their Common Stock. There
can be no assurance that the market price of the Company's Common
Stock will not decline substantially from its historic highs, or
otherwise continue to experience significant fluctuations in the
future, including fluctuations that are unrelated to the
Company's performance. Such fluctuations could materially
adversely affect the market price of the Company's Common Stock.
Control by Existing Stockholders; Effects of Certain Anti-
Takeover Provisions
Members of the Board of Directors and the executive officers of
the Company, together with members of their families and entities
that may be deemed affiliates of or related to such persons or
entities, beneficially own approximately 10% of the outstanding
shares of Common Stock of the Company. Accordingly, these
stockholders are able to influence the election of the members of
the Company's Board of Directors and influence the outcome of
corporate actions requiring stockholder approval, such as mergers
and acquisitions. This level of ownership, together with certain
provisions of the Company's certificate of incorporation, equity
incentive plans, bylaws and Delaware law, may have a significant
effect in delaying, deferring or preventing a change in control
of the Company and may adversely affect the voting and other
rights of other holders of Common Stock.
Possible Adverse Effect on Market Price for Common Stock of
Shares Eligible for Future Sale After the Offering
Sales of the Company's Common Stock into the market could
materially adversely affect the market price of the Company's
Common Stock. Shares of Common Stock sold in the initial public
offering in March 1995 and follow-on offerings in August 1995 and
May 1996, shares to be registered pursuant hereto in connection
with the acquisitions of CSM and CRC, and shares of unregistered
stock, including those shares issued in connection with the
acquisition of ACS, and option shares registered on the Company's
registration statements covering employee compensation plans are
also, or will be in the near future, eligible for immediate sale
in the public market at any time. Most of the other shares of the
Company's Common Stock are not restricted and are freely
tradeable in the public market.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale
of the Resale Shares by the Selling Stockholders.
SELLING STOCKHOLDERS
The following table sets forth the number of shares of Common
Stock owned by each of the Selling Stockholders. None of the
Selling Stockholders has had a material relationship with the
Company or with CSM or CRC, as applicable, within the past three
years other than as a result of the ownership of the Resale
Shares or other securities of the Company or CSM or CRC, as
applicable. Because the Selling Stockholders may offer all or
some of the Resale Shares which they hold pursuant to the
offering contemplated by this Prospectus and because there are
currently no agreements, arrangements or understandings with
respect to the sale of any of the Resale Shares, no estimate can
be given as to the amount of Resale Shares that will be held by
the Selling Stockholders after completion of this offering. The
Resale Shares offered by this Prospectus may be offered from time
to time by the Selling Stockholders named below:
Ownership
After Offering
--------------
Number
Number of Shares of Shares
Name of Selling Owned Prior to Being Number of
Stockholders Offering Offered Shares Percent
Columbia Spectrum 4,580 4,580 0 0
Management, Inc.
Columbia Spectrum 278,358 278,358 0 0
Management Investors, L.P.
Allen Telecom, Inc. 38,338 38,338 0 0
Tom Stroup 107,001 107,001 0 0
William Welch 18,321 18,321 0 0
Katherine Grammes 6,870 6,870 0 0
Thomas Lusk 4,580 4,580 0 0
Bruce B. Bee 1,192 1,192 0 0
Elizabeth Booth 1,805 1,805 0 0
Michael J. Brown 50,295 50,295 0 0
Eileen M. Byrnes 836 836 0 0
Judith Channell 270 270 0 0
James Clements 2,860 2,860 0 0
CMNY Capital 113,841 113,841 0 0
Stacey Cohane 7,867 7,867 0 0
Timothy Collins, Jr. 578 578 0 0
Steven Jay Davis 2,145 2,145 0 0
C.J. Denholm 21,456 21,456 0 0
John B. DiGiglio 1,430 1,430 0 0
Bruce Ducker 953 953 0 0
Kenneth R. Etheredge 516 516 0 0
Sam Fasnacht 1,072 1,072 0 0
Deborah L. Ferguson 1,192 1,192 0 0
Mickey Fouts 2,257 2,257 0 0
J. Gallagher 8,582 8,582 0 0
Mary (Blackburn) Greco
Dockstader 469 469 0 0
Allen J. Green 953 953 0 0
Deborah Dana Heuga 1,907 1,907 0 0
Kenneth D. Higgins 35,760 35,760 0 0
Kenneth Higgins, 1,311 1,311 0 0
Cust. for Joleen D. Higgins
Joleen D. Higgins 6,556 6,556 0 0
Kurtis P. Higgins 10,251 10,251 0 0
Maria L. Higgins 7,867 7,867 0 0
Peter B. Holmes 34,806 34,806 0 0
Alan L. Jacobs 516 516 0 0
David Jackson 6,436 6,436 0 0
Steven Klein 11,920 11,920 0 0
Korr Inc. 17,284 17,284 0 0
Alan L. Madian 1,811 1,811 0 0
Merrill Lynch 23,840 23,840 0 0
Donald Newman 4,769 4,769 0 0
Barbara L. O'Pray, MD 5,905 5,905 0 0
Donald E. Stasko
Bruce L. O'Pray 214,560 214,560 0 0
Suzanne R. O'Pray 6,556 6,556 0 0
Gavin C. Ridge 11,443 11,443 0 0
Michael Schaenen 516 516 0 0
James A. Schneider 5,960 5,960 0 0
Schneider Securities Corp. 924 924 0 0
Trowbridge Limited 2,384 2,384 0 0
Jonathan M. Wainwright, Esq. 596 596 0 0
William M. White 37,768 37,768 0 0
William M. White, for 1,192 1,192 0 0
Wm. Whitney Burke White
_____________________________________________________________________________
Total: 1,131,455 1,131,455 0 0
* less than 1%.
1/ Based upon 19,889,627 shares of Common Stock outstanding on
March 31, 1997. This Registration Statement shall also cover any
additional shares of Common Stock which become issuable in
connection with the shares registered for sale hereby by reason
of any stock dividend, stock split, recapitalization or other
similar transaction effected without the receipt of consideration
which results in an increase in the number of the Registrant's
outstanding shares of Common Stock.
RECENT DEVELOPMENTS
The Acquisitions.
On March 7, 1997, the Company acquired substantially all of the
assets of Columbia Spectrum Management, L.P., a Delaware limited
partnership based in Vienna, Virginia ("CSM"), for $8.0 million
in cash and Common Stock valued at $14.5 million. The former
partners of CSM may receive up to $1,500,000 in cash (as part of
such $8.0 million amount) over the next two years, subject to the
satisfaction of certain indemnification obligations. CSM provides
turnkey relocation services for microwave paths over spectrum
allocated by the Federal Communications Commission for Personal
Communications Services and other emerging technologies.
On May 29, 1997, the Company acquired Control Resources
Corporation, a Delaware corporation located in Fair Lawn, New
Jersey ("CRC"), in a statutory merger. A total of 673,407 shares
of the Company's Common Stock valued at $22 million were issued,
or will be issuable, to former CRC stockholders and optionholders
in exchange for the acquisition by the Company of all outstanding
shares of CRC capital stock and all unexpired and unexercised
options to acquire CRC capital stock, which options the Company
assumed in the merger. CRC is a provider of integrated network
access devices to network service providers and manufactures
products used by the communications industry to connect end user
sites to a range of communications services. CRC's NetPath
product line enables network service providers to offer their
customers a migration path from entry-level data services to cost-
effective integrated delivery of voice, video and Internet
access. The NetPath product line will support the network service
provider's introduction of new technologies including
asynchronous transfer mode and frame relay.
PLAN OF DISTRIBUTION
The Company will not receive proceeds from the sale of Resale
Shares in this offering. The Resale Shares offered hereby may be
sold by the Selling Stockholders from time to time in
transactions in the Nasdaq market, in negotiated transactions, or
a combination of such methods of sale, at fixed prices which may
be changed, at market prices prevailing at the time of sale, at
prices related to prevailing market prices or at negotiated
prices. The Selling Stockholders may effect such transactions by
selling the Resale Shares to or through broker-dealers, and such
broker-dealers may receive compensation in the form of discounts,
concessions or commissions from the Selling Stockholders and/or
the purchasers of the Resale Shares for whom such broker-dealers
may act as agents or to whom they sell as principals, or both
(which compensation as to a particular broker-dealer might be in
excess of customary commissions).
In order to comply with the securities laws of certain states,
if applicable, the Resale Shares will be sold in such
jurisdictions only through registered or licensed brokers or
dealers. In addition, in certain states the Resale Shares may not
be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or
qualification requirement is available and is complied with.
The Selling Stockholders and any broker-dealers or agents that
participate with the Selling Stockholders in the distribution of
the Resale Shares may be deemed to be "underwriters" within the
meaning of the Securities Act, and any commissions received by
them and any profit on the resale of the Resale Shares purchased
by them may be deemed to be underwriting commissions or discounts
under the Securities Act.
The Company has advised the Selling Stockholders that, during
such time as they may be engaged in a distribution of the shares
of Common Stock included herein, they must comply with the
applicable provisions under Regulation M under the Securities
Exchange Act of 1934, as amended ("Regulation M") and, in
connection therewith, the Selling Stockholders may not engage in
any stabilization activity in connection with any securities of
the Company, that they must furnish copies of this Prospectus to
each broker-dealer through which the shares of Common Stock
included herein may be offered, and that they may not bid for or
purchase any securities of the Company or attempt to induce any
person to purchase any securities of the Company except as
permitted under Regulation M. The Selling Stockholders have also
agreed to inform the Company and broker-dealers through whom
sales may be made hereunder when the distribution of the shares
is completed.
Rules 102 and 103 under the Exchange Act prohibits
participants in a distribution from bidding for or purchasing for
an account in which the participant has a beneficial interest,
any of the securities that are the subject of the distribution.
Rule 104 under the Regulation M governs bids and purchases made
to stabilize the price of a security in connection with a
distribution of the security.
The Resale Shares were originally issued in the Acquisitions
pursuant to exemptions from the registration requirements of the
Securities Act provided by Section 4(2) thereof. The Company
agreed to register the Resale Shares under the Securities Act.
The Company has agreed to pay all fees and expenses incident to
the filing of this Registration Statement other than underwriting
discounts, commissions and fees and disbursements of counsel for
the Selling Stockholders.
LEGAL MATTERS
The validity of the securities offered hereby will be passed
upon for the Company by Brobeck, Phleger & Harrison LLP, Palo
Alto, California. As of the date of this Prospectus, a member of
Brobeck, Phleger & Harrison LLP and family members thereof
beneficially owned an aggregate of approximately 25,000 shares of
the Company's Common Stock.
EXPERTS
The consolidated balance sheets of the Company as of December
31, 1996 and 1995 and the related consolidated statements of
operations, stockholder's equity and cash flows for each of the
three years in the period ended December 31, 1996, incorporated
by reference from the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1996 into this Prospectus,
have been incorporated herein in reliance on the report of Price
Waterhouse, LLP, independent accountants, given on the integrity
of that firm as experts in accounting and auditing.
The financial statements of CSM as of and for the years ended
December 31, 1996 and 1995, appearing in the Company's Current
Report on Form 8-K filed on March 21, 1997, as amended, have been
audited by Ernst & Young LLP, independent auditors, as set forth
in their report appearing therein and incorporated herein by
reference. Such financial statements are incorporated herein by
reference in reliance upon such report given upon the authority
of such firm as experts in accounting and auditing.
The financial statements of CRC as of December 31, 1996 and
1995, and for each of the years in the two-year period ended
December 31, 1996, have been incorporated by reference from the
Company's Current Report on Form 8-K filed on June 13, 1997, as
amended, into this Prospectus 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 covering the
December 31, 1996 and 1995 financial statements contains an
explanatory paragraph that states that CRC's 1996 losses from
operations and net stockholders' deficit raise substantial doubt
about CRC'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.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth an itemized statement of all
estimated expenses (except the SEC registration fee) in connection
with the issuance and distribution of the securities being registered:
SEC Registration fee .............................. $ 11,379.69
Legal expenses .................................... 50,000.00
Accounting fees and expenses ...................... 12,500.00
-----------
Total .......................................... $ 73,879.69
Item 15. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law
authorizes a court to award or a corporation's Board of Directors
to grant indemnification to directors and officers in terms
sufficiently broad to permit such indemnification under certain
circumstances for liabilities (including reimbursement for
expenses incurred) arising under the Securities Act of 1933, as
amended (the "Act"). Article VII of the Registrant's Bylaws
provides for mandatory indemnification of its directors and
permissible indemnification of its officers, employees and other
agents to the maximum extent permitted by the Delaware General
Corporation Law. The Registrant has entered into Indemnification
Agreements with its officers and directors which are intended to
provide the Registrant's officers and directors with further
indemnification to the maximum extent permitted by the Delaware
General Corporation Law. Reference is also made to Section 1.10
of the Restated Investor Rights Agreement contained in Exhibit
4.3 incorporated by reference herein, which contains provisions
indemnifying officers and directors of the Registrant against
certain liabilities. Reference is also made to the Underwriting
Agreements entered into in connection with the Company's three
public offerings indemnifying officers and directors of the
Company and other persons against certain liabilities, including
those arising under the Act.
Item 16. Exhibits and Financial Statement Schedules
Number Description
- -------- -------------
2.1(4) Asset Purchase Agreement dated February 12,
1997, by and among the Company, P-Com Field Services,
Columbia Spectrum Management, L.P., and the Partners of
Columbia Spectrum Management, L.P.
2.2(5) Agreement and Plan of Reorganization, dated
as of April 14, 1997, by and among the Company, P-Com
Merger Subsidiary, Inc., Control Resources Corporation
and certain shareholders of Control Resources
Corporation.
4.1(1) Form of Common Stock Certificate.
4.3(1) Amended and Restated Investor Rights
Agreement dated January 11, 1995, by and among the
Company and the parties thereto.
4.4(1) Form of Warrant to Purchase Common Stock of
the Company, forms of Letter Agreements amending
Warrant to Purchase Common Stock and list of holders
thereof.
4.5(1) Warrant Purchase Agreement dated November 9,
1992, by and between the Company and Dominion Ventures,
Inc. ("Dominion"); Series A Preferred Stock Warrant
dated January 8, 1992 issued to Dominion.
4.6(1) Warrant Purchase Agreement dated June 23,
1993 by and between the Company and Dominion; Series B
Preferred Stock Warrant dated June 23, 1993 issued to
Dominion.
4.7(1) Letter Agreement dated June 23, 1993, by and
between the Company and Dominion.
4.8(1) Series C Preferred Stock Warrant dated
January 10, 1995, issued to Applied Telecommunication
Technologies, Inc.
4.9(2) Amendment and Consent to Amended and Restated
Investors Rights Agreement, dated July 28, 1995, by and
among the Company and the parties thereto.
4.10(3) Second Amendment and Consent to Amended and
Restated Investors Rights Agreement, dated April 15,
1996, by and among the Company and the parties thereto.
4.11(4) Registration Rights Agreement dated as of
February 12, 1997 by and among the Company and the
parties thereto.
4.12(5) Registration Rights Agreement dated as of
April 12, 1997 by and among the Company and the parties
thereto.
5.1 Opinion of Brobeck, Phleger & Harrison LLP.
23.1 Consent of Price Waterhouse LLP, Independent
Accountants.
23.2 Consent of Ernst & Young LLP,
Independent Accountants.
23.3 Consent of KPMG Peat Marwick LLP,
Independent Accountants.
23.4 Consent of Brobeck, Phleger & Harrison LLP
(included in Exhibit 5.1).
24.1 Power of Attorney (see page II-3).
- -------------------
(1) Incorporated by reference to identically numbered exhibits
included in the Company's Registration Statement on Form S-1
(File No. 33-88492) declared effective with the Securities
and Exchange Commission on March 2, 1995.
(2) Incorporated by reference to an identically numbered exhibit
included in the Company's Registration Statement on Form S-1
(File No. 33-95392) declared effective with the Securities
and Exchange Commission on August 17, 1995.
(3) Incorporated by reference to an identically numbered exhibit
included in the Company's Registration Statement on Form S-3
(File No. 333-3558) declared effective with the Securities
and Exchange Commission on May 16, 1996.
(4) Incorporated by reference to the Company's Current Report on
Form 8-K filed on March 21, 1997 (File No. 0-25356).
(5) Incorporated by reference to the Company's Current Report on
Form 8-K filed on June 13, 1997 (File No. 0-25356).
Item 17. Undertaking
Insofar as indemnification for liabilities arising under the
Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the Delaware General
Corporation Law, the Certificate of Incorporation or the Bylaws
of the Registrant, Indemnification Agreements entered into
between the Registrant and its officers and directors, 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 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 hereunder, 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 Act and will be governed by the final
adjudication of such issue.
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:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than 20 percent
change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement.
(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.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, 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.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual
report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d)
of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a
new 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
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 this registration
statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the city of Campbell, State of
California on this 31st day of July, 1997.
P-Com, Inc.
By: /s/ George P. Roberts
--------------------------
(George P. Roberts)
Chairman of the Board and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints George P.
Roberts and Michael J. Sophie, and each of them singly, as true
and lawful attorneys-in-fact and agents with full power of
substitution and resubstitution, for him and in his name, place
and stead, in any and all capacities to sign the Registration
Statement filed herewith and any or all amendments to said
Registration Statement (including post-effective amendments and
registration statements filed pursuant to Rule 462 and
otherwise), and to file the same, with all exhibits thereto and
other documents in connection therewith, with the Securities and
Exchange Commission granting unto said attorneys-in-fact and
agents the full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and
about the foregoing, as full to all intents and purposes as he or
she might or could do in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents or any of them, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Witness our hands on the date set forth below.
Pursuant to the requirements of the Securities Act of 1933,
this Amendment No. 1 to this Registration Statement has been
signed by the following persons in the capacities and on the
dates indicated:
Signature Title Date
/s/ George P Roberts July 31, 1997
- ------------------------- Chairman of the Board and
(George P. Roberts) Chief Executive Officer and Director
(Principal Executive Officer)
/s/ Michael J. Sophie July 31, 1997
- -------------------------
(Michael J. Sophie) Chief Financial Officer and
Vice President, Finance and
Administration
(Principal Accounting and
Financial Officer)
* Director July 31, 1997
- ------------------------
(Gill Cogan)
*
- ------------------------ Director July 31, 1997
(John A. Hawkins)
*
- ------------------------ Director July 31, 1997
(M. Bernard Puckett)
*
- ------------------------ Director July 31, 1997
(James J. Sobczak)
* /s/ Michael J. Sophie
- ------------------------
by Michael J. Sophie,
as Attorney-in-Fact
P-COM, INC.
Index to Exhibits
Exhibit Description
--------- -------------
2.1(4) Asset Purchase Agreement dated February 12,
1997, by and among the Company, P-Com Field Services,
Columbia Spectrum Management, L.P., and the Partners of
Columbia Spectrum Management, L.P.
2.2(5) Agreement and Plan of Reorganization, dated
as of April 14, 1997, by and among the Company, P-Com
Merger Subsidiary, Inc. and Control Resources
corporation.
4.1(1) Form of Common Stock Certificate.
4.3(1) Amended and Restated Investor Rights
Agreement dated January 11, 1995, by and among the
Company and the parties thereto.
4.4(1) Form of Warrant to Purchase Common Stock of
the Company, forms of Letter Agreements amending
Warrant to Purchase Common Stock and list of holders
thereof.
4.5(1) Warrant Purchase Agreement dated November 9,
1992, by and between the Company and Dominion Ventures,
Inc. ("Dominion"); Series A Preferred Stock Warrant
dated January 8, 1992 issued to Dominion.
4.6(1) Warrant Purchase Agreement dated June 23,
1993 by and between the Company and Dominion; Series B
Preferred Stock Warrant dated June 23, 1993 issued to
Dominion.
4.7(1) Letter Agreement dated June 23, 1993, by and
between the Company and Dominion.
4.8(1) Series C Preferred Stock Warrant dated
January 10, 1995, issued to Applied Telecommunication
Technologies, Inc.
4.9(2) Amendment and Consent to Amended and Restated
Investors Rights Agreement, dated as of July 28, 1995,
by and among the Company and the parties thereto.
4.10(3) Second Amendment and Consent to Amended and
Restated and Investors Rights Agreement, dated as of
April 15, 1996 by and among the Company and the parties
thereto.
4.11(4) Registration Rights Agreement dated as of
February 12, 1997 by and among the Company and the
parties thereto.
4.12(5) Registration Rights Agreement dated as of
April 12, 1997 by and among the Company and the parties
thereto.
5.1 Opinion of Brobeck, Phleger & Harrison LLP.
23.1 Consent of Price Waterhouse LLP, Independent
Accountants.
23.2 Consent of Ernst & Young LLP,
Independent Accountants.
23.3 Consent of KPMG Peat Marwick LLP,
Independent Accountants.
23.4 Consent of Brobeck, Phleger & Harrison LLP
(included in Exhibit 5.1).
24.1 Power of Attorney (see page II-3).
(1) Incorporated by reference to identically numbered exhibits
included in the Company's Registration Statement on Form S-1
(File No. 33-88492) declared effective with the Securities
and Exchange Commission on March 2, 1995.
(2) Incorporated by reference to an identically numbered exhibit
included in the Company's Registration Statement on Form S-1
(File No. 33-95392) declared effective with the Securities
and Exchange Commission on August 17, 1995.
(3) Incorporated by reference to an identically numbered exhibit
included in the Company's Registration Statement on Form S-3
(File No. 333-3558) declared effective with the Securities
and Exchange Commission on May 16, 1996.
(4) Incorporated by reference to the Company's Current Report on
Form 8-K filed on March 21, 1997 (File No. 0-25356).
(5) Incorporated by reference to the Company's Current Report on
Form 8-K filed on June 13, 1997 (File No. 0-25356).
Exhibit 5.1
July 31, 1997
P-Com, Inc.
3175 S. Winchester Boulevard
Campbell, CA 95008
Ladies and Gentlemen:
We have acted as counsel to P-Com, Inc. (the
"Company"), a Delaware corporation, in connection with its
registration of 1,131,455 shares of Common Stock (the "Common
Stock") as described in the Company's Registration Statement on
Form S-3, as amended, filed with the Securities and Exchange
Commission under the Securities Act of 1933. The Common Stock
consists of shares that may be offered by certain stockholders of
the Company or by pledgees, donees, transferees or other
successors in interest that receive such shares as a gift,
partnership distribution or other non-sale related transfer (the
"Resale Shares").
We are familiar with the corporate proceedings taken by
the Company in connection with the issuance and sale of the
Resale Shares. It is our opinion that the Resale Shares have been
duly authorized and are validly issued, fully paid and
nonassessable.
We consent to the filing of this opinion as Exhibit 5.1
to the Registration Statement and to the reference to this firm
under the caption "Legal Matters" in the Prospectus which is part
of the registration Statement.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Prospectus
constituting part of this Registration Statement on Form S-3, as amended, of
our report dated January 22, 1997 (except for Note 9, which is as of March
7, 1997), which appears on page 36 of P-Com, Inc.'s Annual Report on Form
10-K for the year ended December 31, 1996. We also consent to the reference
to us under the heading "Experts" in such Prospectus.
PRICE WATERHOUSE LLP
San Jose, California
July 31, 1997
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the reference to our firm under the caption
"Experts" in this Registration Statement on Form S-3 (No. 33-30473)
on Form S-3 Pre-effective Amendment No. 1 and related prospectus
of P-Com, Inc. for the registration of 1,131,455 shares of its
common stock, and to the incorporation by reference therein of our
report dated April 14, 1997, with respect to the financial statements
of Columbia Spectrum Management, L.P. as of and for the years
ended December 31, 1996 and 1995, included in P-Com, Inc.'s
March 21, 1997 Current Report on Form 8-K, as amended, filed
with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Vienna, Virginia
July 31, 1997
Exhibit 23.3
CONSENT OF KPMG PEAT MARWICK LLP, INDEPENDENT ACCOUNTANTS
The Board of Directors
Control Resources Corporation:
We consent to the incorporation by reference in the Prospectus
constituting part of this registration statement on Form S-3, as
amended of P-Com, Inc. of our report dated February 7, 1997,
relating to the balance sheets of Control Resources Corporation
("CRC") as of December 31, 1996 and 1995, and the related
statements of operations and (accumulated deficit) retained
earnings, and cash flows for each of the years in the two-year
period ended December 31, 1996, which report appears in the
Form 8-K of P-Com, Inc. dated June 13, 1997, as amended. The
report of KPMG Peat Marwick LLP covering the December 31, 1996
and 1995 financial statements contains an explanatory paragraph
that states that CRC's 1996 losses from operations and net
stockholders' deficit raise substantial doubt about CRC'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. We also consent to the
reference to our firm under the heading "Experts" in such
Prospectus.
KPMG Peat Marwick LLP
Short Hills, New Jersey
July 31, 1997
