<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________
FORM 8-K/A
AMENDMENT NO. 3 TO CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
___________________
Date of Report
(Date of earliest event reported)
March 28, 1998
___________________
P-COM, INC.
(Exact name of registrant as specified in charter)
<TABLE>
<S> <C> <C>
DELAWARE 0-25356 77-02893711
- ------------------------------------ ------- -----------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
</TABLE>
___________________
3175 S. WINCHESTER BOULEVARD,
CAMPBELL, CALIFORNIA 95008
____________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (408) 866-3666
____________________
NOT APPLICABLE
____________________
(Former name or former address, if changed since last report.)
<PAGE>
AMENDMENT NO. 3
P-Com, Inc. ("P-Com") hereby amends the following items to its Current
Reports on Form 8-K, Form 8-K/A (Amendment No. 1) and Form 8-K/A, (Amendment No.
2) filed with the Securities and Exchange Commission on April 9, 1998, April 17,
1998 and June 12, 1998, respectively, as set forth in the pages attached hereto:
Item 7. PRO FORMA FINANCIAL INFORMATION AND EXHIBITS:
The following pro forma financial information is filed as exhibits to
this report.
Exhibit 99.2 - Pro Forma Financial Information, P-Com, Inc. (on a
consolidated basis) and the Wireless Communications Group of Cylink
Corporation (a division of Cylink Corporation) (unaudited).
A. Pro forma Combined Condensed Statement of Operations for the
year ended December 31, 1997 and quarter ended March 31, 1998;
B. Pro forma Combined Condensed Balance Sheet at December 31, 1997
(unaudited); and
C. Notes to Pro Forma Financial Information.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
P-Com, Inc.
(Registrant)
Date: April 30, 1999 By:/s/ Robert E. Collins
Name: Robert E. Collins
Title: Chief Financial Officer
2
<PAGE>
INDEX
Item 7. PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
Document
Exhibit 99.2 Pro Forma Financial Information. P-Com, Inc. (on a consolidated
basis) and the Wireless Communications Group of Cylink
Corporation (a division of Cylink Corporation) (unaudited).
(1) Pro forma Combined Condensed Statement of Operations for
the year ended December 31, 1997 and quarter ended
March 31, 1998
(2) Pro forma Combined Condensed Balance Sheet at December 31,
1997
(3) Notes to Pro Forma Financial Information
3
<PAGE>
EXHIBIT 99.2
ITEM 7(b) Pro Forma Financial Information
-----------------------------------------
Effective March 28, 1998 and April 1, 1998, P-Com, Inc., a Delaware
corporation ("P-Com"), completed its acquisition of substantially all of the
assets of the Wireless Communications Group of Cylink Corporation, a California
corporation ("Wireless"), for approximately $63.0 million including $46.0
million in cash, $14.5 million in a short-term non interest bearing unsecured
subordinated promissory note, and $2.5 million of direct acquisition costs. The
transaction was accounted for as a purchase business combination; accordingly,
the purchase price was allocated to the assets acquired and liabilities assumed
based on their estimated fair market values at the date of acquisition.
The following unaudited pro forma financial information gives effect to the
acquisition as if the transaction had taken place at the beginning of 1997.
The unaudited pro forma statement of operations is not necessarily
indicative of the operating results that would have been achieved if the
transaction had occurred on the date indicated and should not be construed as
representative of future operations. The historical financial statements of
Wireless are included elsewhere in this filing, and the unaudited pro forma
financial information presented herein should be read in conjunction with those
financial statements and related notes.
<PAGE>
P-COM, INC.
PRO FORMA COMBINED CONDENSED
STATEMENT OF OPERATIONS
For the year ended December 31, 1997
(In thousands, except per share data, unaudited)
<TABLE>
<CAPTION>
P-Com Cylink Adjustments Pro Forma
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Sales $220,702 $27,957 $ $248,659
Cost of sales 129,235 12,070 141,305
----------- ----------- ----------- -----------
Gross profit 91,467 15,887 107,354
----------- ----------- ----------- -----------
Operating expenses:
Research and development 29,127 3,608 32,735
Selling and marketing 15,696 6,934 22,630
General and administrative 16,948 3,576 4,786 25,310
----------- ----------- ----------- -----------
Total operating expenses 61,771 14,118 4,786 80,675
----------- ----------- ----------- -----------
Income from operations 29,696 1,769 (4,786) 26,679
Interest and other income 247 115 362
----------- ----------- ----------- -----------
Income before income taxes 29,943 1,884 (4,786) 27,041
Provision for income taxes 11,052 541 11,593
----------- ----------- ----------- -----------
Net income $ 18,891 $ 1,343 $(4,786) $ 15,448
=========== =========== =========== ===========
Net income per share:
Basic $0.45 $0.36
Diluted $0.43 $0.36
Shares used in per share computation:
Basic 42,175 42,175
=========== ===========
Diluted 44,570 44,570
=========== ===========
</TABLE>
<PAGE>
P-COM, INC.
PRO FORMA COMBINED CONDENSED
BALANCE SHEET
For the year ended December 31, 1997
(In thousands, unaudited)
<TABLE>
<CAPTION>
P-Com Cylink Adjustments Pro Forma
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 88,145 $ - $(46,000) $ 42,145
Accounts receivable 70,883 937 - 71,820
Notes receivable 205 - - 205
Inventory 58,003 6,500 - 64,503
Prepaid expenses 12,329 - - 12,329
Total current assets 229,565 7,437 (46,000) 191,002
Property and equipment, net 32,313 461 - 32,774
Goodwill and other assets 43,643 34,261 - 77,904
----------- ----------- ----------- -----------
$305,521 $42,159 $(46,000) $301,680
=========== =========== =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 38,043 $ 1,355 $ 2,483 $ 41,881
Accrued employee benefits 3,930 - - 3,930
Other accrued liabilities 6,255 - - 6,255
Income taxes payable 6,409 - - 6,409
Notes payable 293 - 9,682 9,975
----------- ----------- ----------- -----------
Total current liabilities 54,930 1,355 12,165 68,456
Long-term debt 101,960 - - 101,690
----------- ----------- ----------- -----------
Minority interest 604 - - 604
----------- ----------- ----------- -----------
Stockholders' equity:
Preferred stock - - - -
Common stock 4 - - 4
Additional paid-in capital 131,735 - - 131,735
Retained earnings 18,380 40,804 (58,165) 1,019
Cumulative translation adjustment (1,822) - - (1,822)
----------- ----------- ----------- -----------
Total stockholders' equity 148,297 40,804 (58,165) 130,936
----------- ----------- ----------- -----------
$305,521 $42,159 $(46,000) $301,680
=========== =========== =========== ===========
</TABLE>
<PAGE>
UNAUDITED NOTES TO PRO FORMA FINANCIAL INFORMATION
1. PERIOD PRESENTED
The unaudited pro forma combined condensed statements of operations
for the year ended December 31, 1997 combines the results of operations of P-Com
on a consolidated basis and the results of operations of Wireless for the same
period. The results of operations of P-Com reported in its Quarterly Report on
Form 10-Q ("Form 10-Q") for the three month period ended March 31, 1998 include
the results of operations of Wireless for the period from the date of
acquisition through March 31, 1998. All of the outstanding accounts receivable
of Wireless were purchased by P-Com on April 1, 1998.
2. THE ACQUISITION
The total original purchase price aggregated approximately $58.2
million, including $2.5 million of direct acquisition costs. The purchase price
was allocated to the assets acquired and liabilities assumed based on the
estimated fair market values for all other identifiable tangible and intangible
assets at the acquisition date. The allocation of the purchase price was as
follows (in thousands) (assuming that the entire purchase occurred on March 28,
1998):
Accounts receivable, net $ 4,247
Inventory 5,109
Property and equipment, net 461
Current liabilities assumed (1,355)
Intangible assets:
Goodwill 23,482
In-process research and development 15,442
Developed technology 6,291
Acquired workforce 1,781
Core technology 2,707
------------
$58,165
============
3. ADJUSTMENTS TO STATEMENT OF OPERATIONS AND BALANCE SHEET
On November 5, 1998, Cylink publicly announced that it and its
independent accountants had initiated a review of revenue recognition practices
which would result in a restatement of Cylink's previously issued first and
second quarter 1998 results and that the first three quarters of 1998 were all
expected to show substantial operating losses. During the review, certain facts
became publicly available that indicated that errors had been made in the
application of revenue recognition policies which also impacted Cylink's fourth
quarter of 1997, and as a result, Cylink's 1997 full-year results have been
restated along with first and second quarter 1998 results. These restated
results were announced in a press release issued by Cylink dated December 16,
1998 and have been reflected in the Cylink balances shown in the financial
statements.
<TABLE>
<CAPTION>
For the year ended
December 31, 1997
(As reported/1/) (As restated)
-----------------------------------------------------------
Statement of Operations: (in thousands)
<S> <C> <C>
Revenue $31,267 $27,957
Operating expenses 14,118 14,118
Income from operations 3,688 1,769
Net income 2,668 1,343
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Balance Sheet:
<S> <C> <C>
Accounts receivable 4,247 937
Inventory 5,109 6,500
Retained earnings 42,723 40,804
</TABLE>
/1/ For purposes of the pro forma balance sheet, the as reported balances
reflect the fair values of the assets acquired on March 31, 1998 and April 1,
1998.
Additional adjustments to the Statement of Operations
- -----------------------------------------------------
Pro forma adjustments were made the Statement of Operations to reflect
the amortization of goodwill and other intangible assets over the estimated
lives (in thousands)
<TABLE>
<CAPTION>
Value at acquisition Estimated lives Quarter Year
-------------------- --------------- ------- ----
(In years)
<S> <C> <C> <C> <C>
Goodwill $23,482 10 $ 587 $2,348
Developed technology 6,291 4 393 1,573
Acquired workforce 1,781 3 148 594
Core technology 2,707 10 68 271
-------------------- -------------------- --------------------
$34,261 $1,196 $4,786
==================== ==================== ====================
</TABLE>
The $15.4 million charge to operations related to in-process research
and development has been excluded from the pro forma statement of operations.
Such charge will be recognized in the period in which the transaction occurs.
Additional adjustments to the Balance Sheet
- -------------------------------------------
Pro forma adjustments were made to the Balance Sheet to reflect the
cash paid, the issuance of a short-term promissory note (net of amounts
withheld), and expenses incurred related to the acquisition.
