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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 21, 1999
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P-COM, INC.
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(Exact name of registrant as specified in charter)
Delaware 0-25356 77-0289371
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
3175 S. Winchester Boulevard, Campbell, California 95008
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (408) 866-3666
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None
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(Former name or former address, if changed since last report.)
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4) Exhibit 10.49 - Common Stock PIPES Purchase Agreement, dated
June 21, 1999, by and between P-Com and Gruber McBaine
International.
5) Exhibit 10.50 - Common Stock PIPES Purchase Agreement, dated
June 21, 1999, by and between P-Com and Lockheed Martin Corp.
Master Retirement Trust.
6) Exhibit 10.51 - Common Stock PIPES Purchase Agreement, dated
June 21, 1999, by and between P-Com and Trustees of Hamilton
College.
7) Exhibit 10.52 - Common Stock PIPES Purchase Agreement, dated
June 21, 1999, by and between P-Com and State of Wisconsin
Investment Board.
8) Exhibit 99.1 - Press Release, dated June 21, 1999 announcing the
signing of seven separate agreements to sell a total of
10,067,958 shares of newly issued common stock for an aggregate
of $40 million.
Item 5. Other Events.
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Sale of Common Stock
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On June 21, 1999, the Registrant issued a press release announcing the
signing of seven separate agreements to sell a total of 10,067,958 shares of
newly issued common stock for an aggregate of $40 million. A copy of the press
release is attached hereto and incorporated herein by reference.
Accounting Charges
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The Registrant will record a charge to stockholders' equity in the
second quarter of fiscal 1999 of approximately $9.5 million due to the exchange
on June 4, 1999 of newly issued common stock for all of the Registrant's
outstanding Series B preferred stock. This charge was previously estimated at
$11.5 million.
Statements in this report that are forward looking involve known and
unknown risks and uncertainties, which may cause the Registrant's actual results
in future periods to be materially different from any future performance that
may be suggested in this report. Such factors may include, but are not limited
to, reliance upon subcontractors, fluctuations in customer demand and
commitments, both in timing and volume, introduction of new products, commercial
acceptance and viability of new products and expenses associated therewith,
cancellations of orders without penalties, pricing and competition, the
Registrant's ability to have available an appropriate amount of production
capacity in a timely manner, the ability of the Registrant's customers to
finance their purchases of the Registrant's products and/or services, the timing
of new technology and product introductions, the risk of early obsolescence
accounting for adjustments for the Cylink acquisition and the pending
stockholder class action lawsuits. Further, the Registrant operates in an
industry sector where securities values are highly volatile and may be
influenced by economic and other factors beyond the Registrant's control, such
as announcements by competitors and service providers. Reference is made to the
discussion of risk factors detailed in the Registrant's filings with the
Securities and Exchange Commission, including its reports on Form 10-K and 10-Q.
Item 7. Financial Statement and Exhibits.
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The following documents are filed as exhibits to this report:
1) Exhibit 10.46 - Common Stock PIPES Purchase Agreement, dated June
21, 1999, by and between P-Com and The Kaufmann Fund.
2) Exhibit 10.47 - Common Stock PIPES Purchase Agreement, dated June
21, 1999, by and between P-Com and BayStar Capital, L.P.
3) Exhibit 10.48 - Common Stock PIPES Purchase Agreement, dated June
21, 1999, by and between P-Com and Lagunitas Partners LP.
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4) Exhibit 10.49 - Common Stock PIPES Purchase Agreement, dated June
21, 1999, by and between P-Com and Gruber McBaine International.
5) Exhibit 10.50 - Common Stock PIPES Purchase Agreement, dated June
21, 1999, by and between P-Com and Lockheed Martin Corp. Master
Retirement Trust.
6) Exhibit 10.51 - Common Stock PIPES Purchase Agreement, dated June
21, 1999, by and between P-Com and Trustees of Hamilton College.
7) Exhibit 10.52 - Common Stock PIPES Purchase Agreement, dated June
21, 1999, by and between P-Com and State of Wisconsin Investment
Board.
8) Exhibit 99.1 - Press Release, dated June 21, 1999, announcing the
signing of seven separate agreements to sell a total of
10,067,958 shares of newly issued common stock for an aggregate
of $40 million.
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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.
DATE: June 22, 1999 By: /s/ Robert E. Collins
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Name: Robert E. Collins
Title: Chief Financial Officer
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EXHIBIT INDEX
Exhibit
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10.46 Common Stock PIPES Purchase Agreement, dated June 21, 1999, by and
between P-Com and The Kaufmann Fund.
10.47 Common Stock PIPES Purchase Agreement, dated June 21, 1999, by and
between P-Com and BayStar Capital, L.P.
10.48 Common Stock PIPES Purchase Agreement, dated June 21, 1999, by and
between P-Com and Lagunitas Partners LP.
10.49 Common Stock PIPES Purchase Agreement, dated June 21, 1999, by and
between P-Com and Gruber McBaine International.
10.50 Common Stock PIPES Purchase Agreement, dated June 21, 1999, by and
between P-Com and Lockheed Martin Corp. Master Retirement Trust.
10.51 Common Stock PIPES Purchase Agreement, dated June 21, 1999, by and
between P-Com and Trustees of Hamilton College.
10.52 Common Stock PIPES Purchase Agreement, dated June 21, 1999, by and
between P-Com and State of Wisconsin Investment Board.
99.1 Press Release, dated June 21, 1999, announcing the signing of seven
separate agreements to sell a total of 10,067,958 shares of newly issued
common stock for an aggregate of $40 million.
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EXHIBIT 10.46
COMMON STOCK PIPES PURCHASE AGREEMENT
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THIS COMMON STOCK PIPES PURCHASE AGREEMENT (the "Agreement") is made as of
June 21, 1999, by and between P-Com, Inc., a Delaware corporation (the
"Company"), and The Kaufmann Fund, a Maryland investment company (the
"Investor").
RECITALS:
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A. The Company desires to sell shares of the Company's Common Stock, $.0001
par value ("Common Stock") to the Investor, and the Investor desires to purchase
shares of Common Stock, on the terms and subject to the conditions set forth in
this Agreement.
THE PARTIES AGREE AS FOLLOWS:
1. Purchase and Sale of Common Stock.
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1.1 Sale and Issuance of Common Stock. The Company shall sell to the
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Investor and the Investor shall purchase from the Company, on the date of the
Closing (as defined in Section 1.2 below), at a price per share equal to the
Formula Price (as defined in Section 1.3 below), that number of shares of Common
Stock equal to the quotient of $10,000,000 divided by the Formula Price (the
"Shares").
1.2 Closing. The purchase and sale of the Shares shall take place at
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11:00 a.m. Pacific Daylight Time on June 22, 1999, at the offices of Brobeck,
Phleger & Harrison LLP, 550 West "C" Street, San Diego, California 92101, or on
such date and at such time and place as the Company and the Investor shall
mutually agree (the "Closing"). At the Closing the Company shall deliver to the
Investor a stock certificate representing the Shares against delivery to the
Company by the Investor of $10,000,000 by wire transfer to the Company.
1.3 Formula Price. The "Formula Price" means the product of 92.5%
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times the mean average of the 15 closing sale prices of the Common Stock, as
reported by the Nasdaq
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National Market, for the 15 consecutive trading days ending on and including
June 17, 1999; i.e., the Formula Price is $3.973.
2. Representations and Warranties of the Company. For purposes of this
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Section 2, unless the context otherwise requires, the term "Company" shall
include the Company and its subsidiaries as listed in its most recent Annual
Report on Form 10-K/A for the year ended December 31, 1998 (the "Annual Report")
filed with the Securities and Exchange Commission (the "SEC"). Except as set
forth in the Disclosure Schedule delivered to the Investor supplementally (the
"Disclosure Schedule"), the Company hereby represents and warrants to the
Investor as follows:
2.1 Corporate Organization and Authority of the Company. The Company and
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each of its subsidiaries:
(a) is a corporation duly organized, validly existing, authorized to
exercise all its corporate powers, rights and privileges and in good standing in
the state or jurisdiction of its incorporation;
(b) has the corporate power and authority to own and operate its
properties and to carry on its business as presently conducted and as proposed
to be conducted; and
(c) is qualified to do business as a foreign corporation in each
jurisdiction in which the ownership of its property or the nature of its
business requires such qualification, except where failure to so qualify would
not have a materially adverse effect on the business, properties or financial
condition of the Company and its subsidiaries, taken as a whole. The Company has
furnished to the Investor true and correct copies of its Certificate of
Incorporation and Bylaws, each as amended to date.
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2.2 Capitalization. The authorized capital stock of the Company
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consists of:
(a) Preferred Stock. 2,000,000 shares of Preferred Stock, $.0001
---------------
par value, 750,000 shares of which have been designated Series A Junior
Participating Preferred Stock, of which none were issued and outstanding as of
June 21, 1999.
(b) Common Stock. 95,000,000 shares of Common Stock, $.0001 par
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value, of which 54,101,545 shares were issued and outstanding as of June 21,
1999.
(c) All outstanding shares of the Company's Common Stock have been
duly authorized and validly issued (including, without limitation, issued in
compliance with applicable federal and state securities laws), and are fully
paid and nonassessable.
(d) Since June 21, 1999, the Company has not issued any shares of
Common Stock or Preferred Stock except in connection with the exercise of
outstanding options or warrants. Except as described in the Disclosure Schedule,
there are no options, warrants, conversion privileges or other contractual
rights presently outstanding to purchase or otherwise acquire from the Company
any shares of the Company's capital stock or other securities (whether or not
authorized).
2.3 Subsidiaries. The Company does not presently own, have any
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investment in, or control, directly or indirectly, any subsidiaries,
associations or other business entities, except as disclosed in the Annual
Report. The Company is not a participant in any joint venture or partnership,
except as disclosed in the Annual Report.
2.4 Authorization. All corporate action on the part of the Company,
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its officers, directors and stockholders necessary for the authorization,
execution, delivery and performance by the Company of all its obligations under
this Agreement and for the authorization, issuance, sale and delivery of the
Shares has been taken, and this Agreement, once
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executed by the Company and the Investor, will constitute a legally binding and
valid obligation of the Company enforceable in accordance with its terms, such
enforceability being subject only to laws of general application relating to
bankruptcy, insolvency and the relief of debtors and rules of law governing
specific performance, injunctive relief or other equitable remedies. Except for
rights, if any, which have been duly waived, the issuance and sale of the Shares
will not give rise to any preemptive rights or rights of first refusal on behalf
of any person in existence on the date hereof.
2.5 Validity of Shares. The Shares, when issued, sold and delivered in
------------------
accordance with the terms and for the consideration expressed in this Agreement,
shall be duly and validly issued (including, without limitation, compliance with
applicable federal and state securities laws), fully paid and nonassessable.
2.6 No Conflict. The execution and delivery of this Agreement do not,
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and the consummation of the transactions contemplated hereby will not, conflict
with, or result in any violation of, or default (with or without notice or lapse
in time, or both) under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to a loss of a material benefit under, any
provision of the Certificate of Incorporation or Bylaws of the Company. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated hereby will not, conflict with, or result in any
violation of, or default (with or without notice or lapse in time, or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation or to a loss of a material benefit under, any provision of any
mortgage, indenture, lease or other agreement or instrument, permit, concession,
franchise, license, judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to the Company, its properties or assets, the effect of
which could have a material adverse effect on the
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Company or materially impair or restrict its power to perform its obligations as
contemplated hereby.
2.7 Accuracy of Reports. The Annual Report, the Company's quarterly
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report on Form 10-Q for the quarter ended March 31, 1999 filed with the SEC (the
"Quarterly Report"), and all reports required to be filed by the Company
thereafter to the date of this Agreement under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), copies of which have been furnished to
the Investor (together, the "SEC Reports"), have been duly filed, were (as
amended to date) complete and correct in all material respects as of the dates
at which the information was furnished, and (as amended to date) contained (as
of such dates) no untrue statement of a material fact nor omitted to state a
material fact necessary in order to make the statements made therein, in light
of the circumstances in which they were made, not misleading.
2.8 Changes. Except as otherwise disclosed herein, in the Disclosure
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Schedule or in the SEC Reports, between March 31, 1999 and the date of this
Agreement there has not been:
(a) any change in the assets, liabilities, financial condition,
prospects or operations of the Company from that reflected in the Quarterly
Report, except changes in the ordinary course of business which have not been,
either in any individual case or in the aggregate, materially adverse;
(b) any material change in the contingent obligations of the
Company, whether by way of guaranty, endorsement, indemnity, warranty or
otherwise;
(c) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties or business of the
Company;
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(d) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(e) any labor organization activity; or
(f) to the best of the Company's knowledge, any other event or
condition of any character which has materially and adversely affected the
Company's assets, liabilities, financial condition, prospects or operations.
2.9 Government Consent, etc. No consent, approval or authorization of
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or designation, declaration or filing with any governmental authority on the
part of the Company is required in connection with the valid execution and
delivery of this Agreement, or the offer, sale or issuance of the Shares, or the
consummation of any other transaction contemplated hereby, except the filing of
a Registration Statement and related activities pursuant to Section 4 hereof.
2.10 Full Disclosure. The representations and warranties of the
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Company contained in this Agreement, when read together with the Disclosure
Schedule and the SEC Reports, do not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements contained herein, in light of the circumstances under which they were
made, not misleading.
2.11 Conflicts Prohibited. The Company represents, warrants and
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covenants that to the best of its knowledge no officer or employee of Investor
has a direct or indirect economic interest in the Company or its property or
contracts other than as disclosed in the SEC Reports, nor will any officer or
employee of Investor receive, directly or indirectly, anything of substantial
economic value for his or her private benefit from the Company or anyone acting
on its behalf in connection with the investment made pursuant to this Agreement.
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2.12 Intellectual Property. The Company has not violated and is not
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currently in violation of any copyright, trademark or other intellectual
property rights of any third persons, except to the extent that such violation
does not materially and adversely affect the Company or its operations.
2.13 Litigation/Bankruptcy/Malfeasance. The Company is not the subject
---------------------------------
of and has not received notice of any legal proceedings of the following types
to which the Company is a party (or, if applicable, any executive officer or
director of the Company) or any of its property is the subject: any proceeding
that involves a claim against the Company for damages in excess of $500,000; any
material bankruptcy, receivership or similar proceedings with respect to the
Company; or any criminal proceedings or civil proceedings for fraud or
malfeasance of which a director or executive officer of the Company is the
subject (excluding minor offenses).
3. Representations and Warranties of the Investor. The Investor
----------------------------------------------
represents and warrants to the Company as follows:
3.1 Organization. It is an investment company validly existing
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under the laws of the State of Maryland, with all requisite power and authority
to conduct its business as now being conducted.
3.2 Authority. It has all investment company right, power and
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authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Investor and the consummation by it of the transactions contemplated hereby have
been duly authorized by all necessary investment company action on behalf of the
Investor. This Agreement has been duly executed and delivered
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by and constitutes a legal, valid and binding obligation of the Investor,
enforceable in accordance with its terms, subject to laws of general application
relating to bankruptcy, insolvency and the relief of debtors and rules of law
governing specific performance, injunctive relief or other equitable remedies.
The execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated hereby will not, conflict with or result in any
violation of any obligation under any provision of the authorization statute or
organizational or other charter documents of the Investor or any judgment,
order, decree, statute, law, ordinance, rule or regulation applicable to the
Investor.
3.3 Information. The Investor represents that it has received all the
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information it has requested from the Company and considers necessary or
appropriate for deciding whether to purchase the Shares. The delivery of any
information by the Company to the Investor shall not abrogate the
representations and warranties of the Company contained herein.
3.4 No Current Resale. The Investor is acquiring the Shares for its
-----------------
own account and not with a view to sale or distribution. Any such sale or
distribution shall be made only in compliance with the provisions of the
Securities Act of 1933, as amended (the "Securities Act") and all applicable
blue sky laws. The Investor acknowledges that the Shares are not now registered
under the Securities Act or any blue sky law, and might never be so registered.
The Investor further acknowledges that the stock certificate representing the
Shares will bear a customary securities-law restrictive legend.
3.5 Status of Investor (Regulation D and HSR). The Investor is an
-----------------------------------------
"accredited investor" as such term is defined in Rule 501 as promulgated by the
SEC under the Securities Act.
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4. Covenants.
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4.1 Registration of Shares.
----------------------
(a) The Company shall, before the later of (i) 20 days after the
SEC declares effective the Company's Form S-3 registration statement for the
resale of the Common Stock issued by the Company in exchange for its Series B
Convertible Participating Preferred Stock, and (ii) 45 days following the
Closing, prepare and file with the SEC a registration statement on Form S-1
under the Securities Act covering the resale of the Shares by the Investor
(subject to Section 4.1(g), the "Registration Statement"), and corresponding
applications for registration under the blue sky laws of any states for which
the Investor reasonably requests in writing to the Company that the Company
obtain such blue-sky registration (it being understood that in the vast majority
of states no such registration is legally required, due to the Company's Nasdaq
National Market listing or other reasons). The Company shall use its reasonable
diligent efforts to obtain effectiveness of the Registration Statement and such
blue sky registrations as soon thereafter as practicable, and in any event
within 90 days after the initial filing of the Registration Statement with the
SEC, and shall use its best efforts to keep the Registration Statement and such
blue sky registrations effective after that. Notwithstanding the foregoing, the
Company will only be required to maintain the effectiveness of the Registration
Statement and such blue sky registrations until the earlier of (a) such time as
all of the Shares have been disposed of by the Investor, or (b) such date on
which the Investor may legally dispose of all of the Shares held by it in one
transaction in the open market pursuant to Rule 144(k) under the Securities Act.
The Company shall also cause the Shares to be listed on the Nasdaq National
Market and on any stock exchange on which the Common Stock may from time to time
be listed. The Company shall pay all fees and expenses incurred by the Company
in connection with preparing, filing, prosecuting and updating the Registration
Statement, such blue sky applications
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and registrations, and such listing, including all registration and filing fees,
listing fees, printing expenses, and fees and disbursements of the Company's
counsel and accountants.
(b) The Investor shall cooperate fully with the Company in the
preparation of such Registration Statement and blue sky applications and shall
provide to the Company all information and materials (including updated
information and materials) regarding itself and its proposed method of
disposition of the Shares and take all actions reasonably requested by the
Company to permit the Company to comply with applicable requirements of the SEC,
to comply with applicable requirements of the relevant blue sky laws, and to
obtain the desired acceleration of the effective date of such Registration
Statement.
(c) Subject to Section 4.1(d) hereof, the Company shall promptly
prepare and file with the SEC and any relevant blue sky authorities such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith as may be necessary to keep such Registration Statement
effective and to comply with (and enable the Investor to comply with) the
provisions of the Securities Act and Rule 415 thereunder with respect to the
disposition of all the Shares.
(d) During the effectiveness of the Registration Statement, the
Company shall promptly notify the Investor of the happening of any event or
other circumstance as the result of which, in the Company's judgment, (i) the
prospectus included in the Registration Statement, as then in effect, would
include an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing, or (ii) the offer or
resale of the Shares would otherwise have a material and adverse effect on any
proposed or pending acquisition, merger, business combination or other material
transaction involving the Company; and, upon
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receipt of such notice and until the earlier of (i) the date the Company makes
available to the Investor a supplemented or amended prospectus meeting the
requirements of the Securities Act and relevant blue sky laws, or (ii) the date
the Company notifies the Investor that the Investor may resume offers and sales
using the prior prospectus, the Investor shall not offer or sell any Shares
pursuant to the Registration Statement (and shall return all copies of such
prior prospectus to the Company if requested to do so by it). Notwithstanding
Section 4.1(c), the Company may continue such "blackout" period or periods for
such period of time as the Company considers reasonably necessary and in its
best interest due to circumstances then existing, or simply due to the fact that
amendments/supplements of a Registration Statement/ prospectus cannot be
prepared instantly; but in no event may the Company impose "blackouts" on the
---
Investor for any period of ten or more consecutive business days or totaling
more than 20 days in any 12 month period (plus any "Permitted Blackouts" as
defined in the Registration Rights Agreement dated as of December 21, 1998
between the Company, Castle Creek Technology Partners LLC and others).
(e) The Company shall not be required to apply for or obtain
blue sky registration in any state if in connection therewith or as a condition
thereto it must (i) qualify to do business in such state where it would not
otherwise be required to qualify, (ii) subject itself to general taxation in
such state, (iii) file a general consent to service of process in such state, or
(iv) make any change in its Certificate of Incorporation or Bylaws, which the
Company's Board of Directors determines to be contrary to the best interests of
the Company and its stockholders.
(f) Indemnification.
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(i) The Company will indemnify the Investor, and each of
the officers and directors of, and each person controlling, the Investor,
against all claims, losses,
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expenses, damages and liabilities (or actions in respect thereto) arising out of
or based on (A) any untrue statements (or alleged untrue statement) of a
material fact contained in any prospectus contained in any registration
statement covering the Shares for resale, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (B) any
misrepresentation or breach of any representation or warranty given or made by
the Company in this Agreement, and will reimburse the Investor, each of its
officers and directors and each person controlling the Investor, for any
reasonable legal and any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability or
action, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage or liability is caused by any untrue
statement or omission based upon written information furnished to the Company by
the Investor specifically for use therein.
(ii) The Investor will indemnify the Company, each of its
directors and officers, and each person who controls the Company within the
meaning of the Securities Act, against all claims, losses, expenses, damages and
liabilities (or actions in respect thereof) arising out of or based on (A) any
untrue statement (or alleged untrue statement) of a material fact contained in
any such prospectus, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (B) any sale of Shares which violates (or allegedly
violates) the Securities Act because of violation of the prospectus delivery
requirement or because more or less than the information in such prospectus is
given (or alleged to be given) in connection with the sale, or (C) any
misrepresentation or breach of any representation or warranty given or made by
the Investor in this Agreement, and will reimburse the Company, and such
directors, officers, or
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controlling persons, for any reasonable legal or any other expenses incurred in
connection with investigating, defending or settling any such claim, loss,
damage, liability or action, but in the case of subsection (f)(ii)(A) to the
extent, and only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such prospectus in
reliance upon and in conformity with written information furnished to the
Company by the Investor specifically for use therein.
(iii) Each party entitled to indemnification under this
Section 4.1(f) (the "Indemnified Party") shall give notice to the party required
to provide indemnification (the "Indemnifying Party") promptly after such
indemnified party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not be
unreasonably withheld), and the Indemnified Party may participate in such
defense at the Indemnified Party's expense, and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations hereunder, unless such failure
resulted in actual detriment to the Indemnifying Party. The Indemnified Party
shall provide all cooperation reasonably requested for the defense of the claim
or litigation. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation. An Indemnified Party shall not decline any settlement complying with
the foregoing if it requires nothing of the Indemnified
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Party other than the payment of money (which is in fact paid by the Indemnifying
Party) and does not include an admission of liability.
(iv) In order to provide for just and equitable contribution
to joint liability under the Securities Act in any case in which any person or
entity entitled to indemnification under Section 4.1(f) makes a claim for
indemnification pursuant to this Section 4.1(f) but it is judicially determined
(by entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 4.1(f) provides for indemnification in such case; then, and in
such case, the party that would otherwise be required to indemnify under Section
4.1(f) will contribute to the aggregate losses, claims, damages or liabilities
to which the other parties may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the parties
in connection with the losses suffered, as well as any other relevant equitable
considerations.
(g) The parties agree that if the Company becomes eligible to
register securities for resale on Form S-3 it may choose to register the Shares
for resale on Form S-3 and, after the SEC declares such Form S-3 registration
statement effective, so notify the Investor, provide all relevant deliverables
(such as a supply of new prospectuses), and then deregister the Shares from the
original Form S-1 Registration Statement. Thereafter such Form S-3 Registration
Statement shall, for all purposes of this Agreement, be deemed to be the
"Registration Statement."
4.2 Deliverables Upon Effectiveness. When and if the SEC declares
-------------------------------
the Registration Statement effective, the Company shall promptly deliver to the
Investor:
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(a) A certificate signed by the President of the Company and
that the Registration Statement is effective and, to his knowledge, no stop
order with respect to the Registration Statement has been issued and no
proceedings therefor have been instituted.
(b) A legal opinion of Brobeck, Phleger & Harrison LLP, counsel
to the Company, in substantially the form of Exhibit B.
(c) Such number of copies of the Registration Statement and
(from time to time) of each amendment and supplement thereto, such number of
copies of the prospectus (including (from time to time) any supplemental or
amended prospectus) included in such Registration Statement, and such other
related documents as the Investor may reasonably request in writing in order to
facilitate the disposition of the Shares by the Investor.
4.3 Current Public Information. As long as the Investor owns any
--------------------------
Shares, the Company shall use its best efforts to properly file all SEC Reports,
or otherwise make available "adequate current public information" about itself,
within the meaning of Rule 144(c) under the Securities Act, to potentially make
available to the Investor the benefits of certain rules and regulations of the
SEC which may permit the sale of the Shares without registration.
5. Conditions of the Investor's Obligations at Closing. The obligations
---------------------------------------------------
of the Investor under Section 1 of this Agreement are
subject to the fulfillment at or before the Closing of each of the following
conditions, any of which may be waived in writing by the Investor:
5.1 Bringdown. The Company's representations and warranties in
---------
Section 2 shall be true in all material respects, as if made on and as of the
date of the Closing. The Company shall have performed or fulfilled in all
material respects all agreements, obligations and conditions contained herein
required to be performed or fulfilled by the Company before such Closing.
15
<PAGE>
5.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
5.3 Compliance Certificate. The Company shall have delivered to the
----------------------
Investor a certificate dated as of the date of the Closing signed by the Chief
Executive Officer or President of the Company certifying that, to his knowledge,
the conditions set forth in Sections 5.1, 5.2, 5.5, 5.6, and 5.7 have been
satisfied.
5.4 Opinion of Counsel. There shall have been delivered to the
------------------
Investor an opinion of Brobeck, Phleger & Harrison LLP, counsel to the Company,
in substantially the form of Exhibit A.
5.5 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
5.6 No Material Litigation. During the period from the date of this
----------------------
Agreement to the Closing, no material litigation shall have been initiated
challenging the Company's ownership or its right to use or distribute the core
technology of the Company's products, and the Company shall have not received
any written threat of such litigation or any written claim so challenging the
Company's rights.
5.7 No Fraud or Malfeasance. During the period from the date of this
-----------------------
Agreement to the Closing, (a) none of the Company's officers or directors shall
have been removed for fraud or malfeasance in performance of his or her duties
with respect to the affairs of the Company and (b) no new legal proceedings
against any officers or directors of the Company for fraud or malfeasance in the
performance of his or her duties with respect to the affairs of the Company
shall have been instituted by the Company or its stockholders.
16
<PAGE>
6. Conditions of the Company's Obligations at Closing. The obligations of
--------------------------------------------------
the Company under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Company:
6.1 Bringdown. The Investor's representations and warranties in
---------
Section 3 shall be true in all material respects, as if made on and as of the
date of the Closing.
6.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
6.3 No Order Pending.
----------------
There shall not then be in effect any order enjoining or restraining the
transactions contemplated by this Agreement.
7. Miscellaneous.
-------------
7.1 Entire Agreement. This Agreement constitutes the entire contract
----------------
between the Company and the Investor relative to the subject matter hereof. Any
previous or contemporaneous agreements, understandings, promises and
representations (whether written or oral) with regard to such subject between
the Company and the Investor are superseded by this Agreement.
7.2 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the
laws of the State of California applicable to contracts entered into and wholly
to be performed within the State of California by California residents.
7.3 Counterparts. This Agreement may be executed in counterparts,
------------
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
17
<PAGE>
7.4 Headings. The headings of the Sections and subsections of this
--------
Agreement are for convenience and shall not determine the interpretation of this
Agreement.
7.5 Notices. Any notice required or permitted hereunder shall be
-------
given in writing and shall be conclusively deemed effectively given upon
personal delivery, or, if made by registered or certified United States mail,
postage prepaid, four business days after mailing, or if made by overnight
carrier, one business day after sending, in all instances addressed (i) if to
the Company, as set forth below the Company's name on the signature page of this
Agreement, and (ii) if to the Investor, as set forth below the Investor's name
on the signature page to this Agreement, or at such other address as the Company
or the Investor may designate by ten days' advance written notice to the
Investor or the Company, respectively.
7.6 Survival of Warranties. The representations and warranties of the
----------------------
parties contained in or made pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the Closing for three years;
provided, however, that such representations and warranties need only be
accurate as of the date of such execution and delivery.
7.7 Amendment of Agreement. Any provision of this Agreement may be
----------------------
modified or amended, at any time, by a written instrument signed by the Company
and by the Investor, and not in any other way.
7.8 Fees and Expenses. The Company and the Investor will each bear
-----------------
their own fees and expenses in connection with the transactions contemplated by
this Agreement.
7.9 Finders' Fees. The Company will hold the Investor harmless from
-------------
all finders' or brokers' fees in connection with the sale of the Shares to the
Investor.
18
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
PIPES Purchase Agreement as of the day and year first above written.
P-COM, INC., a Delaware corporation
By: /s/ George P. Roberts
__________________________________
Title: Chief Executive Officer
__________________________________
Address: 3175 S. Winchester Boulevard
Campbell, CA 95008
Attention: Chief Financial Officer
THE KAUFMANN FUND
By: /s/ Lawrence Auriana
----------------------------------
Title: Chairman
----------------------------------
Address: 140 East 45th Street
43rd Floor
New York, NY 10017
19
<PAGE>
EXHIBIT A
June 22, 1999
The Kaufmann Fund
140 East 45th Street
43rd Floor
New York, NY 10017
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of shares of its
common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you. This opinion letter is being rendered to you pursuant to
Section 5.4 of the Stock Purchase Agreement in connection with the Closing of
the sale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In connection with the opinions expressed herein, we have made such
examination of matters of law and of fact as we considered appropriate or
advisable for purposes hereof. As to matters of fact material to the opinions
expressed herein, we have relied upon the representations and warranties as to
factual matters contained in and made by the Company pursuant to the Stock
Purchase Agreement and upon certificates and statements of government officials
and of officers of the Company. We have also examined originals or copies of
such corporate documents or records of the Company as we have considered
appropriate for the opinions expressed herein. We have assumed for the purposes
of this opinion letter the genuineness of all signatures, the legal capacity of
natural persons, the authenticity of the documents submitted to us as originals,
the conformity to the original documents of all documents submitted to us as
certified, facsimile or photostatic copies, and the authenticity of the
originals of such copies.
In rendering this opinion letter we have also assumed: (A) that the Stock
Purchase Agreement has been duly and validly executed and delivered by you or on
your behalf, that you have the power to enter into and perform all your
obligations thereunder, and that the Stock Purchase Agreement constitutes a
valid, legal, binding and enforceable obligation upon you; (B) that the
representations and warranties made in the Stock Purchase Agreement by you are
true and correct; and (C) that any wire transfers, drafts or checks tendered by
you will be honored.
As used in this opinion letter, the expression "we are not aware" or the
phrase "to our knowledge", or any similar expression or phrase with respect to
our knowledge of matters of fact, means as to matters of fact that, based on the
actual knowledge of individual attorneys within the firm principally responsible
for handling current matters for the Company (and not including any constructive
or imputed notice of any information), and after an examination of documents
referred to herein and after inquiries of certain officers of the Company, no
facts have
<PAGE>
been disclosed to us that have caused us to conclude that the opinions expressed
are factually incorrect; but beyond that we have made no factual investigation
for the purposes of rendering this opinion letter. Specifically, but without
limitation, we have not searched the dockets of any courts and we have made no
inquiries of securities holders or employees of the Company, other than such
officers.
This opinion letter relates solely to the laws of the State of California,
the General Corporation Law of the State of Delaware and the federal law of the
United States and we express no opinion with respect to the effect or
application of any other laws. Special rulings of authorities administering
such laws or opinions of other counsel have not been sought or obtained.
Based upon our examination of and reliance upon the foregoing and subject
to the limitations, exceptions, qualifications and assumptions set forth below
and except as set forth in the Stock Purchase Agreement or the Disclosure
Schedule thereto, we are of the opinion that as of the date hereof:
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, and the Company has
the requisite corporate power and authority to own its properties and to conduct
its business as, to our knowledge, it is presently conducted. The Company is
qualified to do business as a foreign corporation in the state of California.
2. The Company has the requisite corporate power and authority to
execute, deliver and perform the Stock Purchase Agreement. The Stock Purchase
Agreement has been duly and validly authorized by the Company, duly executed and
delivered by an authorized officer of the Company and constitutes a legal, valid
and binding obligation of the Company, enforceable by you against the Company in
accordance with its terms.
3. The Shares have been duly authorized and, upon purchase at the Closing
pursuant to the terms of the Stock Purchase Agreement, will be validly issued,
nonassessable and fully paid, and free of any liens created by the Company.
4. The Company's execution and delivery of, and its performance and
compliance as of the date hereof with the terms of, the Stock Purchase Agreement
do not violate any provision of any federal, Delaware corporate or California
law, rule or regulation applicable to the Company or any provision of the
Company's Restated Certificate of Incorporation or Bylaws and do not conflict
with or constitute a default under the provisions of any judgment, writ, decree
or order specifically identified in the SEC Reports or the material provisions
of any of the material agreements specifically identified in the SEC Reports.
5. Other than in connection with any securities laws, all consents,
approvals, permits, orders or authorizations of, and all qualifications by and
registrations with, any federal or Delaware corporate or California state
governmental authority on the part of the Company required in connection with
the execution and delivery of the Stock Purchase Agreement and consummation at
the Closing of the transactions contemplated by the Stock Purchase Agreement
A-2
<PAGE>
have been obtained, and are effective, and we are not aware of any proceedings,
or written threat of any proceedings, that question the validity thereof.
6. Based in part upon the representations of you in the Stock Purchase
Agreement, the offer and sale of the Shares to you pursuant to the terms of the
Stock Purchase Agreement are exempt from the registration requirements of
Section 5 of the Securities Act of 1933, as amended, and from the qualification
requirements of the California Corporate Securities Law of 1968, as amended.
Our opinions expressed above are specifically subject to the following
limitations, exceptions, qualifications and assumptions:
(A) The legality, validity, binding nature and enforceability of the
Company's obligations under the Stock Purchase Agreement may be subject to or
limited by (1) bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent transfer and other similar laws affecting the rights of creditors
generally; (2) general principles of equity (whether relief is sought in a
proceeding at law or in equity), including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the discretion of
any court of competent jurisdiction in awarding specific performance or
injunctive relief and other equitable remedies; and (3), without limiting the
generality of the foregoing, the effect of California court decisions and
statutes which indicate that provisions of the Stock Purchase Agreement which
permit you to take action or make determinations may be subject to a requirement
that such action be taken or such determinations be made on a reasonable basis
in good faith or that it be shown that such action is reasonably necessary for
your protection.
(B) We express no opinion as to the Company's compliance or noncompliance
with applicable federal or state antifraud or antitrust statutes, laws, rules
and regulations.
(C) We express no opinion concerning the past, present or future fair
market value of any securities.
(D) We express no opinion as to the enforceability under certain
circumstances of any provisions indemnifying a party against, or requiring
contributions toward, that party's liability for its own wrongful or negligent
acts, or where indemnification or contribution is contrary to public policy or
prohibited by law. In this regard, we advise you that in the opinion of the
Securities and Exchange Commission, indemnification of directors, officers and
controlling persons of an issuer against liabilities arising under the
Securities Act of 1933, as amended, is against public policy and is therefore
unenforceable.
(E) We express no opinion as to the enforceability under certain
circumstances of any provisions prohibiting waivers of any terms of the Stock
Purchase Agreement other than in writing, or prohibiting oral modifications
thereof or modification by course of dealing. In addition, our opinions are
subject to the effect of judicial decisions which may permit the introduction of
extrinsic evidence to interpret the terms of written contracts.
A-3
<PAGE>
(F) We express no opinion as to the effect of Section 1670.5 of the
California Civil Code or any other California law, federal law or equitable
principle which provides that a court may refuse to enforce, or may limit the
application of, a contract or any clause thereof which the court finds to have
been unconscionable at the time it was made or contrary to public policy.
(G) We express no opinion as to your compliance with any Federal or state
law relating to your legal or regulatory status.
(H) We express no opinion as to the compliance of the Company, the
Investor or the sale of the Common Stock to the Investor with the provisions of
the Small Business Investment Act of 1958, as amended, or any of the regulations
promulgated thereunder.
(I) We express no opinion as to the effect of subsequent issuances of
securities of the Company, to the extent that further issuances which may be
integrated with the Closing may include purchasers that do not meet the
definition of "accredited investors" under Rule 501 of Regulation D and
equivalent definitions under state securities or "blue sky" laws.
(J) We express no opinion as to Section 7.2 of the Stock Purchase
Agreement to the extent that it purports to exclude conflict of law principles
under California law.
(K) With your permission, we express no opinion regarding the Hart-Scott-
Rodino Antitrust Improvements Act of 1976.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and may not be
delivered to, quoted or relied upon by any person other than you, or for any
other purpose, without our prior written consent. Our opinion is expressly
limited to the matters set forth above and we render no opinion, whether by
implication or otherwise, as to any other matters relating to the Company or the
Shares. We assume no obligation to advise you of facts, circumstances, events or
developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
A-4
<PAGE>
EXHIBIT B
_____________, 1999
The Kaufmann Fund
140 East 45th Street
43rd Floor
New York, NY 10017
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of certain Shares of
its common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you and in connection with the Company's registration with the
SEC of such Shares for resale by you. This opinion letter is being rendered to
you pursuant to Section 4.2(b) of the Stock Purchase Agreement in connection
with the SEC declaring effective the Registration Statement for your resale of
the Shares. Capitalized terms not otherwise defined in this opinion letter have
the meanings given them in the Stock Purchase Agreement.
In our capacity as counsel to the Company, we have examined, among other
things, originals, or copies identified to our satisfaction as being true
copies, of the Registration Statement on Form S-1 (File No. 333-____________)
initially filed by the Company with the SEC on ____________, 1999, for the
purpose of registering the resale of the Shares under the Securities Act;
Amendment No. 1 to such Registration Statement filed with the SEC on
_____________, 1999; Amendment No. 2 to such Registration Statement filed with
the SEC on _____________, 1999; and oral advice on ______________, 1999, from an
SEC staff examiner, that the SEC had declared such Registration Statement, as so
amended, effective as of ______ p.m., Washington, D.C. time, on _____________,
1999.
As used in this opinion letter, the phrase "to our knowledge" means as to
matters of fact that, based on the actual knowledge of individual attorneys
within the firm principally responsible for handling current matters for the
Company (and not including any constructive or imputed notice of any
information), no facts have been disclosed to us that have caused us to conclude
that the opinions expressed are factually incorrect; but our affirmative factual
investigation for the purpose of rendering this opinion letter has been limited
to obtaining (a) oral advice received on ___________, from an SEC staff
examiner, that the SEC had declared such Registration Statement, as amended,
effective at _____ p.m. Washington, D.C. time, on _________ , 1999 and (b) oral
advice received on ___________, 1999 from an SEC staff examiner that there is no
stop order suspending the effectiveness of the Registration Statement.
Based upon our examination of and reliance upon the foregoing, we are of
the opinion that as of the date hereof:
<PAGE>
1. The Registration Statement has become effective under the Securities
Act and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose are
pending before or contemplated by the SEC.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and the
Registration Statement and may not be delivered to, quoted or relied upon by any
person other than you, or for any other purpose, without our prior written
consent. Our opinion is expressly limited to the matters set forth above and we
render no opinion, whether by implication or otherwise, as to any other matters
relating to the Company, the Stock Purchase Agreement, the Registration
Statement or the Shares. We assume no obligation to advise you of facts,
circumstances, events or developments which hereafter may be brought to our
attention and which may alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
B-2
<PAGE>
EXHIBIT 10.47
COMMON STOCK PIPES PURCHASE AGREEMENT
THIS COMMON STOCK PIPES PURCHASE AGREEMENT (the "Agreement") is made as of
June 21, 1999, by and between P-Com, Inc., a Delaware corporation (the
"Company"), and BayStar Capital, L.P., a Delaware limited partnership (the
"Investor").
RECITALS:
--------
A. The Company desires to sell shares of the Company's Common Stock,
$.0001 par value ("Common Stock") to the Investor, and the Investor desires to
purchase shares of Common Stock, on the terms and subject to the conditions set
forth in this Agreement.
THE PARTIES AGREE AS FOLLOWS:
1. Purchase and Sale of Common Stock.
---------------------------------
1.1 Sale and Issuance of Common Stock. The Company shall sell to the
---------------------------------
Investor and the Investor shall purchase from the Company, on the date of the
Closing (as defined in Section 1.2 below), at a price per share equal to the
Formula Price (as defined in Section 1.3 below), that number of shares of Common
Stock equal to the quotient of $7,500,000 divided by the Formula Price (the
"Shares").
1.2 Closing. The purchase and sale of the Shares shall take place at
-------
11:00 a.m. Pacific Daylight Time on June 22, 1999, at the offices of Brobeck,
Phleger & Harrison LLP, 550 West "C" Street, San Diego, California 92101, or on
such date and at such time and place as the Company and the Investor shall
mutually agree (the "Closing"). At the Closing the Company shall deliver to the
Investor a stock certificate representing the Shares against delivery to the
Company by the Investor of $7,500,000 by wire transfer to the Company.
1.3 Formula Price. The "Formula Price" means the product of 92.5%
-------------
times the mean average of the 15 closing sale prices of the Common Stock, as
reported by the Nasdaq
<PAGE>
National Market, for the 15 consecutive trading days ending on and including
June 17, 1999; i.e., the Formula Price is $3.973.
2. Representations and Warranties of the Company. For purposes of this
---------------------------------------------
Section 2, unless the context otherwise requires, the term "Company" shall
include the Company and its subsidiaries as listed in its most recent Annual
Report on Form 10-K/A for the year ended December 31, 1998 (the "Annual Report")
filed with the Securities and Exchange Commission (the "SEC"). Except as set
forth in the Disclosure Schedule delivered to the Investor supplementally (the
"Disclosure Schedule"), the Company hereby represents and warrants to the
Investor as follows:
2.1 Corporate Organizaton and Authority of the Company. The Company
--------------------------------------------------
and each of its sunsidiaries:
(a) is a corporation duly organized, validly existing,
authorized to exercise all its corporate powers, rights and privileges and in
good standing in the state or jurisdiction of its incorporation;
(b) has the corporate power and authority to own and operate its
properties and to carry on its business as presently conducted and as proposed
to be conducted; and
(c) is qualified to do business as a foreign corporation in each
jurisdiction in which the ownership of its property or the nature of its
business requires such qualification, except where failure to so qualify would
not have a materially adverse effect on the business, properties or financial
condition of the Company and its subsidiaries, taken as a whole. The Company has
furnished to the Investor true and correct copies of its Certificate of
Incorporation and Bylaws, each as amended to date.
2
<PAGE>
2.2 Capitalization. The authorized capital stock of the Company
--------------
consists of:
(a) Preferred Stock. 2,000,000 shares of Preferred Stock,
---------------
$.0001 par value, 750,000 shares of which have been designated Series A
Junior Participating Preferred Stock, of which none were issued and
outstanding as of June 21, 1999.
(b) Common Stock. 95,000,000 shares of Common Stock, $.0001 par
------------
value, of which 54,101,545 shares were issued and outstanding as of June 21,
1999.
(c) All outstanding shares of the Company's Common Stock have
been duly authorized and validly issued (including, without limitation,
issued in compliance with applicable federal and state securities laws),
and are fully paid and nonassessable.
(d) Since June 21, 1999, the Company has not issued any shares
of Common Stock or Preferred Stock except in connection with the exercise
of outstanding options or warrants. Except as described in the Disclosure
Schedule, there are no options, warrants, conversion privileges or other
contractual rights presently outstanding to purchase or otherwise acquire
from the Company any shares of the Company's capital stock or other
securities (whether or not authorized).
2.3 Subsidiaries. The Company does not presently own, have any
------------
investment in, or control, directly or indirectly, any subsidiaries,
associations or other business entities, except as disclosed in the Annual
Report. The Company is not a participant in any joint venture or partnership,
except as disclosed in the Annual Report.
2.4 Authorization. All corporate action on the part of the Company,
-------------
its officers, directors and stockholders necessary for the authorization,
execution, delivery and performance by the Company of all its obligations under
this Agreement and for the authorization, issuance, sale and delivery of the
Shares has been taken, and this Agreement, once
3
<PAGE>
executed by the Company and the Investor, will constitute a legally binding and
valid obligation of the Company enforceable in accordance with its terms, such
enforceability being subject only to laws of general application relating to
bankruptcy, insolvency and the relief of debtors and rules of law governing
specific performance, injunctive relief or other equitable remedies. Except for
rights, if any, which have been duly waived, the issuance and sale of the Shares
will not give rise to any preemptive rights or rights of first refusal on behalf
of any person in existence on the date hereof.
2.5 Validity of Shares. The Shares, when issued, sold and delivered
------------------
in accordance with the terms and for the consideration expressed in this
Agreement, shall be duly and validly issued (including, without limitation,
compliance with applicable federal and state securities laws), fully paid and
nonassessable.
2.6 No Conflict. The execution and delivery of this Agreement do not,
-----------
and the consummation of the transactions contemplated hereby will not, conflict
with, or result in any violation of, or default (with or without notice or lapse
in time, or both) under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to a loss of a material benefit under, any
provision of the Certificate of Incorporation or Bylaws of the Company. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated hereby will not, conflict with, or result in any
violation of, or default (with or without notice or lapse in time, or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation or to a loss of a material benefit under, any provision of any
mortgage, indenture, lease or other agreement or instrument, permit, concession,
franchise, license, judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to the Company, its properties or assets, the effect of
which could have a material adverse effect on the
4
<PAGE>
Company or materially impair or restrict its power to perform its obligations as
contemplated hereby.
2.7 Accuracy of Reports. The Annual Report, the Company's quarterly
-------------------
report on Form 10-Q for the quarter ended March 31, 1999 filed with the SEC (the
"Quarterly Report"), and all reports required to be filed by the Company
thereafter to the date of this Agreement under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), copies of which have been furnished to
the Investor (together, the "SEC Reports"), have been duly filed, were (as
amended to date) complete and correct in all material respects as of the dates
at which the information was furnished, and (as amended to date) contained (as
of such dates) no untrue statement of a material fact nor omitted to state a
material fact necessary in order to make the statements made therein, in light
of the circumstances in which they were made, not misleading .
2.8 Changes. Except as otherwise disclosed herein, in the Disclosure
-------
Schedule or in the SEC Reports, between March 31, 1999 and the date of this
Agreement there has not been:
(a) any change in the assets, liabilities, financial condition,
prospects or operations of the Company from that reflected in the Quarterly
Report, except changes in the ordinary course of business which have not been,
either in any individual case or in the aggregate, materially adverse;
(b) any material change in the contingent obligations of the
Company, whether by way of guaranty, endorsement, indemnity, warranty or
otherwise;
(c) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties or business of the
Company;
5
<PAGE>
(d) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(e) any labor organization activity; or
(f) to the best of the Company's knowledge, any other event or
condition of any character which has materially and adversely affected the
Company's assets, liabilities, financial condition, prospects or operations.
2.9 Government Consent, etc. No consent, approval or authorization of
------------------------
or designation, declaration or filing with any governmental authority on the
part of the Company is required in connection with the valid execution and
delivery of this Agreement, or the offer, sale or issuance of the Shares, or the
consummation of any other transaction contemplated hereby, except the filing of
a Registration Statement and related activities pursuant to Section 4 hereof.
2.10 Full Disclosure. The representations and warranties of the
---------------
Company contained in this Agreement, when read together with the Disclosure
Schedule and the SEC Reports, do not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements contained herein, in light of the circumstances under which they were
made, not misleading.
2.11 Conflicts Prohibited. The Company represents, warrants and
--------------------
covenants that to the best of its knowledge no officer or employee of Investor
has a direct or indirect economic interest in the Company or its property or
contracts other than as disclosed in the SEC Reports, nor will any officer or
employee of Investor receive, directly or indirectly, anything of substantial
economic value for his or her private benefit from the Company or anyone acting
on its behalf in connection with the investment made pursuant to this Agreement.
6
<PAGE>
2.12 Intellectual Property. The Company has not violated and is not
---------------------
currently in violation of any copyright, trademark or other intellectual
property rights of any third persons, except to the extent that such violation
does not materially and adversely affect the Company or its operations.
2.13 Litigation/Bankruptcy/Malfeasance. The Company is not the
---------------------------------
subject of and has not received notice of any legal proceedings of the following
types to which the Company is a party (or, if applicable, any executive officer
or director of the Company) or any of its property is the subject: any
proceeding that involves a claim against the Company for damages in excess of
$500,000; any material bankruptcy, receivership or similar proceedings with
respect to the Company; or any criminal proceedings or civil proceedings for
fraud or malfeasance of which a director or executive officer of the Company is
the subject (excluding minor offenses).
3. Representations and Warranties of the Investor. The Investor
----------------------------------------------
represents and warrants to the Company as follows:
3.1 Organization. It is a limited partnership validly existing under
------------
the laws of the State of Delaware, with all requisite power and authority to
conduct its business as now being conducted.
3.2 Authority. It has all limited partnership right, power and
---------
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Investor and the consummation by it of the transactions contemplated hereby have
been duly authorized by all necessary limited partnership action on behalf of
the Investor. This Agreement has been duly executed and delivered by and
constitutes
7
<PAGE>
a legal, valid and binding obligation of the Investor, enforceable in accordance
with its terms, subject to laws of general application relating to bankruptcy,
insolvency and the relief of debtors and rules of law governing specific
performance, injunctive relief or other equitable remedies. The execution and
delivery of this Agreement do not, and the consummation of the transactions
contemplated hereby will not, conflict with or result in any violation of any
obligation under any provision of the authorization statute or organizational or
other charter documents of the Investor or any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to the Investor.
3.3 Information. The Investor represents that it has received all the
-----------
information it has requested from the Company and considers necessary or
appropriate for deciding whether to purchase the Shares. The delivery of any
information by the Company to the Investor shall not abrogate the
representations and warranties of the Company contained herein.
3.4 No Current Resale. The Investor is acquiring the Shares for its
-----------------
own account and not with a view to sale or distribution. Any such sale or
distribution shall be made only in compliance with the provisions of the
Securities Act of 1933, as amended (the "Securities Act") and all applicable
blue sky laws. The Investor acknowledges that the Shares are not now registered
under the Securities Act or any blue sky law, and might never be so registered.
The Investor further acknowledges that the stock certificate representing the
Shares will bear a customary securities-law restrictive legend.
3.5 Status of Investor (Regulation D and HSR). The Investor is an
-----------------------------------------
"accredited investor" as such term is defined in Rule 501 as promulgated by the
SEC under the Securities Act.
8
<PAGE>
4. Covenants.
---------
4.1 Registration of Shares.
----------------------
(a) The Company shall, before the later of (i) 20 days after the
SEC declares effective the Company's Form S-3 registration statement for the
resale of the Common Stock issued by the Company in exchange for its Series B
Convertible Participating Preferred Stock, and (ii) 45 days following the
Closing, prepare and file with the SEC a registration statement on Form S-1
under the Securities Act covering the resale of the Shares by the Investor
(subject to Section 4.1(g), the "Registration Statement"), and corresponding
applications for registration under the blue sky laws of any states for which
the Investor reasonably requests in writing to the Company that the Company
obtain such blue-sky registration (it being understood that in the vast majority
of states no such registration is legally required, due to the Company's Nasdaq
National Market listing or other reasons). The Company shall use its reasonable
diligent efforts to obtain effectiveness of the Registration Statement and such
blue sky registrations as soon thereafter as practicable, and in any event
within 90 days after the initial filing of the Registration Statement with the
SEC, and shall use its best efforts to keep the Registration Statement and such
blue sky registrations effective after that. Notwithstanding the foregoing, the
Company will only be required to maintain the effectiveness of the Registration
Statement and such blue sky registrations until the earlier of (a) such time as
all of the Shares have been disposed of by the Investor, or (b) such date on
which the Investor may legally dispose of all of the Shares held by it in one
transaction in the open market pursuant to Rule 144(k) under the Securities Act.
The Company shall also cause the Shares to be listed on the Nasdaq National
Market and on any stock exchange on which the Common Stock may from time to time
be listed. The Company shall pay all fees and expenses incurred by the Company
in connection with preparing, filing, prosecuting and updating the Registration
Statement, such blue sky applications
9
<PAGE>
and registrations, and such listing, including all registration and filing fees,
listing fees, printing expenses, and fees and disbursements of the Company's
counsel and accountants.
(b) The Investor shall cooperate fully with the Company in the
preparation of such Registration Statement and blue sky applications and shall
provide to the Company all information and materials (including updated
information and materials) regarding itself and its proposed method of
disposition of the Shares and take all actions reasonably requested by the
Company to permit the Company to comply with applicable requirements of the SEC,
to comply with applicable requirements of the relevant blue sky laws, and to
obtain the desired acceleration of the effective date of such Registration
Statement.
(c) Subject to Section 4.1(d) hereof, the Company shall promptly
prepare and file with the SEC and any relevant blue sky authorities such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith as may be necessary to keep such Registration Statement
effective and to comply with (and enable the Investor to comply with) the
provisions of the Securities Act and Rule 415 thereunder with respect to the
disposition of all the Shares.
(d) During the effectiveness of the Registration Statement, the
Company shall promptly notify the Investor of the happening of any event or
other circumstance as the result of which, in the Company's judgment, (i) the
prospectus included in the Registration Statement, as then in effect, would
include an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing, or (ii) the offer or
resale of the Shares would otherwise have a material and adverse effect on any
proposed or pending acquisition, merger, business combination or other material
transaction involving the Company; and, upon
10
<PAGE>
receipt of such notice and until the earlier of (i) the date the Company makes
available to the Investor a supplemented or amended prospectus meeting the
requirements of the Securities Act and relevant blue sky laws, or (ii) the date
the Company notifies the Investor that the Investor may resume offers and sales
using the prior prospectus, the Investor shall not offer or sell any Shares
pursuant to the Registration Statement (and shall return all copies of such
prior prospectus to the Company if requested to do so by it). Notwithstanding
Section 4.1(c), the Company may continue such "blackout" period or periods for
such period of time as the Company considers reasonably necessary and in its
best interest due to circumstances then existing, or simply due to the fact that
amendments/supplements of a Registration Statement/ prospectus cannot be
prepared instantly; but in no event may the Company impose "blackouts" on the
---
Investor for any period of ten or more consecutive business days or totaling
more than 20 days in any 12 month period (plus any "Permitted Blackouts" as
defined in the Registration Rights Agreement dated as of December 21, 1998
between the Company, Castle Creek Technology Partners LLC and others).
(e) The Company shall not be required to apply for or obtain
blue sky registration in any state if in connection therewith or as a condition
thereto it must (i) qualify to do business in such state where it would not
otherwise be required to qualify, (ii) subject itself to general taxation in
such state, (iii) file a general consent to service of process in such state, or
(iv) make any change in its Certificate of Incorporation or Bylaws, which the
Company's Board of Directors determines to be contrary to the best interests of
the Company and its stockholders.
(f) Indemnification.
---------------
(i) The Company will indemnify the Investor, and each of
the officers and directors of, and each person controlling, the Investor,
against all claims, losses,
11
<PAGE>
expenses, damages and liabilities (or actions in respect thereto) arising out of
or based on (A) any untrue statements (or alleged untrue statement) of a
material fact contained in any prospectus contained in any registration
statement covering the Shares for resale, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (B) any
misrepresentation or breach of any representation or warranty given or made by
the Company in this Agreement, and will reimburse the Investor, each of its
officers and directors and each person controlling the Investor, for any
reasonable legal and any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability or
action, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage or liability is caused by any untrue
statement or omission based upon written information furnished to the Company by
the Investor specifically for use therein.
(ii) The Investor will indemnify the Company, each of its
directors and officers, and each person who controls the Company within the
meaning of the Securities Act, against all claims, losses, expenses, damages and
liabilities (or actions in respect thereof) arising out of or based on (A) any
untrue statement (or alleged untrue statement) of a material fact contained in
any such prospectus, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (B) any sale of Shares which violates (or allegedly
violates) the Securities Act because of violation of the prospectus delivery
requirement or because more or less than the information in such prospectus is
given (or alleged to be given) in connection with the sale, or (C) any
misrepresentation or breach of any representation or warranty given or made by
the Investor in this Agreement, and will reimburse the Company, and such
directors, officers, or
12
<PAGE>
controlling persons, for any reasonable legal or any other expenses incurred in
connection with investigating, defending or settling any such claim, loss,
damage, liability or action, but in the case of subsection (f)(ii)(A) to the
extent, and only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such prospectus in
reliance upon and in conformity with written information furnished to the
Company by the Investor specifically for use therein.
(iii) Each party entitled to indemnification under this
Section 4.1(f) (the "Indemnified Party") shall give notice to the party required
to provide indemnification (the "Indemnifying Party") promptly after such
indemnified party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not be
unreasonably withheld), and the Indemnified Party may participate in such
defense at the Indemnified Party's expense, and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations hereunder, unless such failure
resulted in actual detriment to the Indemnifying Party. The Indemnified Party
shall provide all cooperation reasonably requested for the defense of the claim
or litigation. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation. An Indemnified Party shall not decline any settlement complying with
the foregoing if it requires nothing of the Indemnified
13
<PAGE>
Party other than the payment of money (which is in fact paid by the Indemnifying
Party) and does not include an admission of liability.
(iv) In order to provide for just and equitable contribution
to joint liability under the Securities Act in any case in which any person or
entity entitled to indemnification under Section 4.1(f) makes a claim for
indemnification pursuant to this Section 4.1(f) but it is judicially determined
(by entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 4.1(f) provides for indemnification in such case; then, and in
such case, the party that would otherwise be required to indemnify under Section
4.1(f) will contribute to the aggregate losses, claims, damages or liabilities
to which the other parties may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the parties
in connection with the losses suffered, as well as any other relevant equitable
considerations.
(g) The parties agree that if the Company becomes eligible to
register securities for resale on Form S-3 it may choose to register the Shares
for resale on Form S-3 and, after the SEC declares such Form S-3 registration
statement effective, so notify the Investor, provide all relevant deliverables
(such as a supply of new prospectuses), and then deregister the Shares from the
original Form S-1 Registration Statement. Thereafter such Form S-3 Registration
Statement shall, for all purposes of this Agreement, be deemed to be the
"Registration Statement."
4.2 Deliverables Upon Effectiveness. When and if the SEC declares the
-------------------------------
Registration Statement effective, the Company shall promptly deliver to the
Investor:
14
<PAGE>
(a) A certificate signed by the President of the Company and
that the Registration Statement is effective and, to his knowledge, no stop
order with respect to the Registration Statement has been issued and no
proceedings therefor have been instituted.
(b) A legal opinion of Brobeck, Phleger & Harrison LLP, counsel
to the Company, in substantially the form of Exhibit B.
(c) Such number of copies of the Registration Statement and
(from time to time) of each amendment and supplement thereto, such number of
copies of the prospectus (including (from time to time) any supplemental or
amended prospectus) included in such Registration Statement, and such other
related documents as the Investor may reasonably request in writing in order to
facilitate the disposition of the Shares by the Investor.
4.3 Current Public Information. As long as the Investor owns any
--------------------------
Shares, the Company shall use its best efforts to properly file all SEC Reports,
or otherwise make available "adequate current public information" about itself,
within the meaning of Rule 144(c) under the Securities Act, to potentially make
available to the Investor the benefits of certain rules and regulations of the
SEC which may permit the sale of the Shares without registration.
5. Conditions of the Investor's Obligations at Closing. The obligations
---------------------------------------------------
of the Investor under Section 1 of this Agreement are subject to the fulfillment
at or before the Closing of each of the following conditions, any of which may
be waived in writing by the Investor:
5.1 Bringdown. The Company's representations and warranties in
---------
Section 2 shall be true in all material respects, as if made on and as of the
date of the Closing. The Company shall have performed or fulfilled in all
material respects all agreements, obligations and conditions contained herein
required to be performed or fulfilled by the Company before such Closing.
15
<PAGE>
5.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
5.3 Compliance Certificate. The Company shall have delivered to the
----------------------
Investor a certificate dated as of the date of the Closing signed by the Chief
Executive Officer or President of the Company certifying that, to his knowledge,
the conditions set forth in Sections 5.1, 5.2, 5.5, 5.6, and 5.7 have been
satisfied.
5.4 Opinion of Counsel. There shall have been delivered to the
------------------
Investor an opinion of Brobeck, Phleger & Harrison LLP, counsel to the Company,
in substantially the form of Exhibit A.
5.5 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
5.6 No Material Litigation. During the period from the date of this
----------------------
Agreement to the Closing, no material litigation shall have been initiated
challenging the Company's ownership or its right to use or distribute the core
technology of the Company's products, and the Company shall have not received
any written threat of such litigation or any written claim so challenging the
Company's rights.
5.7 No Fraud or Malfeasance. During the period from the date of this
-----------------------
Agreement to the Closing, (a) none of the Company's officers or directors shall
have been removed for fraud or malfeasance in performance of his or her duties
with respect to the affairs of the Company and (b) no new legal proceedings
against any officers or directors of the Company for fraud or malfeasance in the
performance of his or her duties with respect to the affairs of the Company
shall have been instituted by the Company or its stockholders.
16
<PAGE>
6. Conditions of the Company's Obligations at Closing. The obligations of
--------------------------------------------------
the Company under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Company:
6.1 Bringdown. The Investor's representations and warranties in
---------
Section 3 shall be true in all material respects, as if made on and as of the
date of the Closing.
6.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
6.3 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
7. Miscellaneous.
-------------
7.1 Entire Agreement. This Agreement constitutes the entire contract
----------------
between the Company and the Investor relative to the subject matter hereof. Any
previous or contemporaneous agreements, understandings, promises and
representations (whether written or oral) with regard to such subject between
the Company and the Investor are superseded by this Agreement.
7.2 Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the State of California applicable to contracts
entered into and wholly to be performed within the State of California by
California residents.
7.3 Counterparts. This Agreement may be executed in counterparts,
------------
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
17
<PAGE>
7.4 Headings. The headings of the Sections and subsections of this
--------
Agreement are for convenience and shall not determine the interpretation of this
Agreement.
7.5 Notices. Any notice required or permitted hereunder shall be
-------
given in writing and shall be conclusively deemed effectively given upon
personal delivery, or, if made by registered or certified United States mail,
postage prepaid, four business days after mailing, or if made by overnight
carrier, one business day after sending, in all instances addressed (i) if to
the Company, as set forth below the Company's name on the signature page of this
Agreement, and (ii) if to the Investor, as set forth below the Investor's name
on the signature page to this Agreement, or at such other address as the Company
or the Investor may designate by ten days' advance written notice to the
Investor or the Company, respectively.
7.6 Survival of Warranties. The representations and warranties of the
----------------------
parties contained in or made pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the Closing for three years;
provided, however, that such representations and warranties need only be
accurate as of the date of such execution and delivery.
7.7 Amendment of Agreement. Any provision of this Agreement may be
----------------------
modified or amended, at any time, by a written instrument signed by the Company
and by the Investor, and not in any other way.
7.8 Fees and Expenses. The Company and the Investor will each bear
-----------------
their own fees and expenses in connection with the transactions contemplated by
this Agreement.
7.9 Finders' Fees. The Company will hold the Investor harmless from
-------------
all finders' or brokers' fees in connection with the sale of the Shares to the
Investor.
18
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
PIPES Purchase Agreement as of the day and year first above written.
P-COM, INC., a Delaware corporation
By: /s/ George P. Roberts
_____________________________________
Title: Chief Executive Officer
_____________________________________
Address: 3175 S. Winchester Boulevard
Campbell, CA 95008
Attention: Chief Financial Officer
BAYSTAR CAPITAL, L.P., a Delaware limited
partnership
By: BayStar Capital Management LLC, its general
partner
By: /s/ Steven Lamar
----------------------------------
Title: Vice President
-------------------------------
Address: 505 Montgomery Street
20th Floor
San Francisco, CA 94111
19
<PAGE>
EXHIBIT A
June 22, 1999
BayStar Capital, L.P.
505 Montgomery Street
20th Floor
San Francisco, CA 94111
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of shares of its
common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you. This opinion letter is being rendered to you pursuant to
Section 5.4 of the Stock Purchase Agreement in connection with the Closing of
the sale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In connection with the opinions expressed herein, we have made such
examination of matters of law and of fact as we considered appropriate or
advisable for purposes hereof. As to matters of fact material to the opinions
expressed herein, we have relied upon the representations and warranties as to
factual matters contained in and made by the Company pursuant to the Stock
Purchase Agreement and upon certificates and statements of government officials
and of officers of the Company. We have also examined originals or copies of
such corporate documents or records of the Company as we have considered
appropriate for the opinions expressed herein. We have assumed for the purposes
of this opinion letter the genuineness of all signatures, the legal capacity of
natural persons, the authenticity of the documents submitted to us as originals,
the conformity to the original documents of all documents submitted to us as
certified, facsimile or photostatic copies, and the authenticity of the
originals of such copies.
In rendering this opinion letter we have also assumed: (A) that the Stock
Purchase Agreement has been duly and validly executed and delivered by you or on
your behalf, that you have the power to enter into and perform all your
obligations thereunder, and that the Stock Purchase Agreement constitutes a
valid, legal, binding and enforceable obligation upon you; (B) that the
representations and warranties made in the Stock Purchase Agreement by you are
true and correct; and (C) that any wire transfers, drafts or checks tendered by
you will be honored.
As used in this opinion letter, the expression "we are not aware" or the
phrase "to our knowledge", or any similar expression or phrase with respect to
our knowledge of matters of fact, means as to matters of fact that, based on the
actual knowledge of individual attorneys within the firm principally responsible
for handling current matters for the Company (and not including any constructive
or imputed notice of any information), and after an examination of documents
referred to herein and after inquiries of certain officers of the Company, no
facts have
<PAGE>
been disclosed to us that have caused us to conclude that the opinions expressed
are factually incorrect; but beyond that we have made no factual investigation
for the purposes of rendering this opinion letter. Specifically, but without
limitation, we have not searched the dockets of any courts and we have made no
inquiries of securities holders or employees of the Company, other than such
officers.
This opinion letter relates solely to the laws of the State of California,
the General Corporation Law of the State of Delaware and the federal law of the
United States and we express no opinion with respect to the effect or
application of any other laws. Special rulings of authorities administering
such laws or opinions of other counsel have not been sought or obtained.
Based upon our examination of and reliance upon the foregoing and subject
to the limitations, exceptions, qualifications and assumptions set forth below
and except as set forth in the Stock Purchase Agreement or the Disclosure
Schedule thereto, we are of the opinion that as of the date hereof:
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, and the Company has
the requisite corporate power and authority to own its properties and to conduct
its business as, to our knowledge, it is presently conducted. The Company is
qualified to do business as a foreign corporation in the state of California.
2. The Company has the requisite corporate power and authority to
execute, deliver and perform the Stock Purchase Agreement. The Stock Purchase
Agreement has been duly and validly authorized by the Company, duly executed and
delivered by an authorized officer of the Company and constitutes a legal, valid
and binding obligation of the Company, enforceable by you against the Company in
accordance with its terms.
3. The Shares have been duly authorized and, upon purchase at the Closing
pursuant to the terms of the Stock Purchase Agreement, will be validly issued,
nonassessable and fully paid, and free of any liens created by the Company.
4. The Company's execution and delivery of, and its performance and
compliance as of the date hereof with the terms of, the Stock Purchase Agreement
do not violate any provision of any federal, Delaware corporate or California
law, rule or regulation applicable to the Company or any provision of the
Company's Restated Certificate of Incorporation or Bylaws and do not conflict
with or constitute a default under the provisions of any judgment, writ, decree
or order specifically identified in the SEC Reports or the material provisions
of any of the material agreements specifically identified in the SEC Reports.
5. Other than in connection with any securities laws, all consents,
approvals, permits, orders or authorizations of, and all qualifications by and
registrations with, any federal or Delaware corporate or California state
governmental authority on the part of the Company required in connection with
the execution and delivery of the Stock Purchase Agreement and consummation at
the Closing of the transactions contemplated by the Stock Purchase Agreement
A-2
<PAGE>
have been obtained, and are effective, and we are not aware of any proceedings,
or written threat of any proceedings, that question the validity thereof.
6. Based in part upon the representations of you in the Stock Purchase
Agreement, the offer and sale of the Shares to you pursuant to the terms of the
Stock Purchase Agreement are exempt from the registration requirements of
Section 5 of the Securities Act of 1933, as amended, and from the qualification
requirements of the California Corporate Securities Law of 1968, as amended.
Our opinions expressed above are specifically subject to the following
limitations, exceptions, qualifications and assumptions:
(A) The legality, validity, binding nature and enforceability of the
Company's obligations under the Stock Purchase Agreement may be subject to or
limited by (1) bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent transfer and other similar laws affecting the rights of creditors
generally; (2) general principles of equity (whether relief is sought in a
proceeding at law or in equity), including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the discretion of
any court of competent jurisdiction in awarding specific performance or
injunctive relief and other equitable remedies; and (3), without limiting the
generality of the foregoing, the effect of California court decisions and
statutes which indicate that provisions of the Stock Purchase Agreement which
permit you to take action or make determinations may be subject to a requirement
that such action be taken or such determinations be made on a reasonable basis
in good faith or that it be shown that such action is reasonably necessary for
your protection.
(B) We express no opinion as to the Company's compliance or noncompliance
with applicable federal or state antifraud or antitrust statutes, laws, rules
and regulations.
(C) We express no opinion concerning the past, present or future fair
market value of any securities.
(D) We express no opinion as to the enforceability under certain
circumstances of any provisions indemnifying a party against, or requiring
contributions toward, that party's liability for its own wrongful or negligent
acts, or where indemnification or contribution is contrary to public policy or
prohibited by law. In this regard, we advise you that in the opinion of the
Securities and Exchange Commission, indemnification of directors, officers and
controlling persons of an issuer against liabilities arising under the
Securities Act of 1933, as amended, is against public policy and is therefore
unenforceable.
(E) We express no opinion as to the enforceability under certain
circumstances of any provisions prohibiting waivers of any terms of the Stock
Purchase Agreement other than in writing, or prohibiting oral modifications
thereof or modification by course of dealing. In addition, our opinions are
subject to the effect of judicial decisions which may permit the introduction of
extrinsic evidence to interpret the terms of written contracts.
A-3
<PAGE>
(F) We express no opinion as to the effect of Section 1670.5 of the
California Civil Code or any other California law, federal law or equitable
principle which provides that a court may refuse to enforce, or may limit the
application of, a contract or any clause thereof which the court finds to have
been unconscionable at the time it was made or contrary to public policy.
(G) We express no opinion as to your compliance with any Federal or state
law relating to your legal or regulatory status.
(H) We express no opinion as to the compliance of the Company, the
Investor or the sale of the Common Stock to the Investor with the provisions of
the Small Business Investment Act of 1958, as amended, or any of the regulations
promulgated thereunder.
(I) We express no opinion as to the effect of subsequent issuances of
securities of the Company, to the extent that further issuances which may be
integrated with the Closing may include purchasers that do not meet the
definition of "accredited investors" under Rule 501 of Regulation D and
equivalent definitions under state securities or "blue sky" laws.
(J) We express no opinion as to Section 7.2 of the Stock Purchase
Agreement to the extent that it purports to exclude conflict of law principles
under California law.
(K) With your permission, we express no opinion regarding the Hart-Scott-
Rodino Antitrust Improvements Act of 1976.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and may not be
delivered to, quoted or relied upon by any person other than you, or for any
other purpose, without our prior written consent. Our opinion is expressly
limited to the matters set forth above and we render no opinion, whether by
implication or otherwise, as to any other matters relating to the Company or the
Shares. We assume no obligation to advise you of facts, circumstances, events
or developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
A-4
<PAGE>
EXHIBIT B
_____________, 1999
BayStar Capital, L.P.
505 Montgomery Street
20th Floor
San Francisco, CA 94111
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of certain Shares of
its common stock, par value $.0001 per share, pursuant to the Common Stock
PIPES Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement")
between the Company and you and in connection with the Company's registration
with the SEC of such Shares for resale by you. This opinion letter is being
rendered to you pursuant to Section 4.2(b) of the Stock Purchase Agreement in
connection with the SEC declaring effective the Registration Statement for your
resale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In our capacity as counsel to the Company, we have examined, among other
things, originals, or copies identified to our satisfaction as being true
copies, of the Registration Statement on Form S-1 (File No. 333-____________)
initially filed by the Company with the SEC on ____________, 1999, for the
purpose of registering the resale of the Shares under the Securities Act;
Amendment No. 1 to such Registration Statement filed with the SEC on
_____________, 1999; Amendment No. 2 to such Registration Statement filed with
the SEC on _____________, 1999; and oral advice on ______________, 1999, from an
SEC staff examiner, that the SEC had declared such Registration Statement, as so
amended, effective as of ______ p.m., Washington, D.C. time, on _____________,
1999.
As used in this opinion letter, the phrase "to our knowledge" means as to
matters of fact that, based on the actual knowledge of individual attorneys
within the firm principally responsible for handling current matters for the
Company (and not including any constructive or imputed notice of any
information), no facts have been disclosed to us that have caused us to conclude
that the opinions expressed are factually incorrect; but our affirmative factual
investigation for the purpose of rendering this opinion letter has been limited
to obtaining (a) oral advice received on ___________, from an SEC staff
examiner, that the SEC had declared such Registration Statement, as amended,
effective at _____ p.m. Washington, D.C. time, on _________ , 1999 and (b) oral
advice received on ___________, 1999 from an SEC staff examiner that there is no
stop order suspending the effectiveness of the Registration Statement.
Based upon our examination of and reliance upon the foregoing, we are of
the opinion that as of the date hereof:
<PAGE>
1. The Registration Statement has become effective under the Securities
Act and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose are
pending before or contemplated by the SEC.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and the
Registration Statement and may not be delivered to, quoted or relied upon by any
person other than you, or for any other purpose, without our prior written
consent. Our opinion is expressly limited to the matters set forth above and we
render no opinion, whether by implication or otherwise, as to any other matters
relating to the Company, the Stock Purchase Agreement, the Registration
Statement or the Shares. We assume no obligation to advise you of facts,
circumstances, events or developments which hereafter may be brought to our
attention and which may alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
B-2
<PAGE>
EXHIBIT 10.48
COMMON STOCK PIPES PURCHASE AGREEMENT
THIS COMMON STOCK PIPES PURCHASE AGREEMENT (the "Agreement") is made as of
June 21, 1999, by and between P-Com, Inc., a Delaware corporation (the
"Company"), and Lagunitas Partners LP, a California limited partnership (the
"Investor").
RECITALS:
--------
A. The Company desires to sell shares of the Company's Common Stock,
$.0001 par value ("Common Stock") to the Investor, and the Investor desires to
purchase shares of Common Stock, on the terms and subject to the conditions set
forth in this Agreement.
THE PARTIES AGREE AS FOLLOWS:
1. Purchase and Sale of Common Stock.
---------------------------------
1.1 Sale and Issuance of Common Stock. The Company shall sell to
---------------------------------
the Investor and the Investor shall purchase from the Company, on the date of
the Closing (as defined in Section 1.2 below), at a price per share equal to the
Formula Price (as defined in Section 1.3 below), that number of shares of Common
Stock equal to the quotient of $1,500,000 divided by the Formula Price (the
"Shares").
1.2 Closing. The purchase and sale of the Shares shall take place
-------
at 11:00 a.m. Pacific Daylight Time on June 22, 1999, at the offices of Brobeck,
Phleger & Harrison LLP, 550 West "C" Street, San Diego, California 92101, or on
such date and at such time and place as the Company and the Investor shall
mutually agree (the "Closing"). At the Closing the Company shall deliver to the
Investor a stock certificate representing the Shares against delivery to the
Company by the Investor of $1,500,000 by wire transfer to the Company.
1.3 Formula Price. The "Formula Price" means the product of 92.5%
-------------
times the mean average of the 15 closing sale prices of the Common Stock, as
reported by the Nasdaq
<PAGE>
National Market, for the 15 consecutive trading days ending on and including
June 17, 1999; i.e., the Formula Price is $3.973.
2. Representations and Warranties of the Company. For purposes of this
---------------------------------------------
Section 2, unless the context otherwise requires, the term "Company" shall
include the Company and its subsidiaries as listed in its most recent Annual
Report on Form 10-K/A for the year ended December 31, 1998 (the "Annual Report")
filed with the Securities and Exchange Commission (the "SEC"). Except as set
forth in the Disclosure Schedule delivered to the Investor supplementally (the
"Disclosure Schedule"), the Company hereby represents and warrants to the
Investor as follows:
2.1 Corporate Organization and Authority of the Company. The Company
---------------------------------------------------
and each of its subsidiaries:
(a) is a corporation duly organized, validly existing,
authorized to exercise all its corporate powers, rights and privileges and in
good standing in the state or jurisdiction of its incorporation;
(b) has the corporate power and authority to own and operate its
properties and to carry on its business as presently conducted and as proposed
to be conducted; and
(c) is qualified to do business as a foreign corporation in each
jurisdiction in which the ownership of its property or the nature of its
business requires such qualification, except where failure to so qualify would
not have a materially adverse effect on the business, properties or financial
condition of the Company and its subsidiaries, taken as a whole. The Company has
furnished to the Investor true and correct copies of its Certificate of
Incorporation and Bylaws, each as amended to date.
2
<PAGE>
2.2 Capitalization. The authorized capital stock of the Company
--------------
consists of:
(a) Preferred Stock. 2,000,000 shares of Preferred Stock, $.0001
---------------
par value, 750,000 shares of which have been designated Series A Junior
Participating Preferred Stock, of which none were issued and outstanding as of
June 21, 1999.
(b) Common Stock. 95,000,000 shares of Common Stock, $.0001 par
------------
value, of which 54,101,545 shares were issued and outstanding as of June 21,
1999.
(c) All outstanding shares of the Company's Common Stock have
been duly authorized and validly issued (including, without limitation, issued
in compliance with applicable federal and state securities laws), and are fully
paid and nonassessable.
(d) Since June 21, 1999, the Company has not issued any shares
of Common Stock or Preferred Stock except in connection with the exercise of
outstanding options or warrants. Except as described in the Disclosure Schedule,
there are no options, warrants, conversion privileges or other contractual
rights presently outstanding to purchase or otherwise acquire from the Company
any shares of the Company's capital stock or other securities (whether or not
authorized).
2.3 Subsidiaries. The Company does not presently own, have any
------------
investment in, or control, directly or indirectly, any subsidiaries,
associations or other business entities, except as disclosed in the Annual
Report. The Company is not a participant in any joint venture or partnership,
except as disclosed in the Annual Report.
2.4 Authorization. All corporate action on the part of the Company,
-------------
its officers, directors and stockholders necessary for the authorization,
execution, delivery and performance by the Company of all its obligations under
this Agreement and for the authorization, issuance, sale and delivery of the
Shares has been taken, and this Agreement, once
3
<PAGE>
executed by the Company and the Investor, will constitute a legally binding and
valid obligation of the Company enforceable in accordance with its terms, such
enforceability being subject only to laws of general application relating to
bankruptcy, insolvency and the relief of debtors and rules of law governing
specific performance, injunctive relief or other equitable remedies. Except for
rights, if any, which have been duly waived, the issuance and sale of the Shares
will not give rise to any preemptive rights or rights of first refusal on behalf
of any person in existence on the date hereof.
2.5 Validity of Shares. The Shares, when issued, sold and delivered
------------------
in accordance with the terms and for the consideration expressed in this
Agreement, shall be duly and validly issued (including, without limitation,
compliance with applicable federal and state securities laws), fully paid and
nonassessable.
2.6 No Conflict. The execution and delivery of this Agreement do
-----------
not, and the consummation of the transactions contemplated hereby will not,
conflict with, or result in any violation of, or default (with or without notice
or lapse in time, or both) under, or give rise to a right of termination,
cancellation or acceleration of any obligation or to a loss of a material
benefit under, any provision of the Certificate of Incorporation or Bylaws of
the Company. The execution and delivery of this Agreement do not, and the
consummation of the transactions contemplated hereby will not, conflict with, or
result in any violation of, or default (with or without notice or lapse in time,
or both) under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to a loss of a material benefit under, any
provision of any mortgage, indenture, lease or other agreement or instrument,
permit, concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to the Company, its properties or
assets, the effect of which could have a material adverse effect on the
4
<PAGE>
Company or materially impair or restrict its power to perform its obligations as
contemplated hereby.
2.7 Accuracy of Reports. The Annual Report, the Company's quarterly
-------------------
report on Form 10-Q for the quarter ended March 31, 1999 filed with the SEC (the
"Quarterly Report"), and all reports required to be filed by the Company
thereafter to the date of this Agreement under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), copies of which have been furnished to
the Investor (together, the "SEC Reports"), have been duly filed, were (as
amended to date) complete and correct in all material respects as of the dates
at which the information was furnished, and (as amended to date) contained (as
of such dates) no untrue statement of a material fact nor omitted to state a
material fact necessary in order to make the statements made therein, in light
of the circumstances in which they were made, not misleading.
2.8 Changes. Except as otherwise disclosed herein, in the Disclosure
-------
Schedule or in the SEC Reports, between March 31, 1999 and the date of this
Agreement there has not been:
(a) any change in the assets, liabilities, financial condition,
prospects or operations of the Company from that reflected in the Quarterly
Report, except changes in the ordinary course of business which have not been,
either in any individual case or in the aggregate, materially adverse;
(b) any material change in the contingent obligations of the
Company, whether by way of guaranty, endorsement, indemnity, warranty or
otherwise;
(c) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties or business of the
Company;
5
<PAGE>
(d) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(e) any labor organization activity; or
(f) to the best of the Company's knowledge, any other event or
condition of any character which has materially and adversely affected the
Company's assets, liabilities, financial condition, prospects or operations.
2.9 Government Consent, etc. No consent, approval or authorization
-----------------------
of or designation, declaration or filing with any governmental authority on the
part of the Company is required in connection with the valid execution and
delivery of this Agreement, or the offer, sale or issuance of the Shares, or the
consummation of any other transaction contemplated hereby, except the filing of
a Registration Statement and related activities pursuant to Section 4 hereof.
2.10 Full Disclosure. The representations and warranties of the
---------------
Company contained in this Agreement, when read together with the Disclosure
Schedule and the SEC Reports, do not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements contained herein, in light of the circumstances under which they were
made, not misleading.
2.11 Conflicts Prohibited. The Company represents, warrants and
--------------------
covenants that to the best of its knowledge no officer or employee of Investor
has a direct or indirect economic interest in the Company or its property or
contracts other than as disclosed in the SEC Reports, nor will any officer or
employee of Investor receive, directly or indirectly, anything of substantial
economic value for his or her private benefit from the Company or anyone acting
on its behalf in connection with the investment made pursuant to this Agreement.
6
<PAGE>
2.12 Intellectual Property. The Company has not violated and is not
---------------------
currently in violation of any copyright, trademark or other intellectual
property rights of any third persons, except to the extent that such violation
does not materially and adversely affect the Company or its operations.
2.13 Litigation/Bankruptcy/Malfeasance. The Company is not the
---------------------------------
subject of and has not received notice of any legal proceedings of the following
types to which the Company is a party (or, if applicable, any executive officer
or director of the Company) or any of its property is the subject: any
proceeding that involves a claim against the Company for damages in excess of
$500,000; any material bankruptcy, receivership or similar proceedings with
respect to the Company; or any criminal proceedings or civil proceedings for
fraud or malfeasance of which a director or executive officer of the Company is
the subject (excluding minor offenses).
3. Representations and Warranties of the Investor. The Investor represents
----------------------------------------------
and warrants to the Company as follows:
3.1 Organization. It is a limited partnership validly existing under
------------
the laws of the State of California, with all requisite power and authority to
conduct its business as now being conducted.
3.2 Authority. It has all limited partnership right, power and
---------
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Investor and the consummation by it of the transactions contemplated hereby have
been duly authorized by all necessary limited partnership action on behalf of
the Investor. This Agreement has been duly executed and delivered by and
constitutes
7
<PAGE>
a legal, valid and binding obligation of the Investor, enforceable in accordance
with its terms, subject to laws of general application relating to bankruptcy,
insolvency and the relief of debtors and rules of law governing specific
performance, injunctive relief or other equitable remedies. The execution and
delivery of this Agreement do not, and the consummation of the transactions
contemplated hereby will not, conflict with or result in any violation of any
obligation under any provision of the authorization statute or organizational or
other charter documents of the Investor or any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to the Investor.
3.3 Information. Investor represents that it has received all the
-----------
information it has requested from the Company and considers necessary or
appropriate for deciding whether to purchase the Shares. The delivery of any
information by the Company to the Investor shall not abrogate the
representations and warranties of the Company contained herein.
3.4 No Current Resale. The Investor is acquiring the Shares for its
-----------------
own account and not with a view to sale or distribution. Any such sale or
distribution shall be made only in compliance with the provisions of the
Securities Act of 1933, as amended (the "Securities Act") and all applicable
blue sky laws. The Investor acknowledges that the Shares are not now registered
under the Securities Act or any blue sky law, and might never be so registered.
The Investor further acknowledges that the stock certificate representing the
Shares will bear a customary securities-law restrictive legend.
3.5 Status of Investor (Regulation D and HSR). The Investor is an
-----------------------------------------
"accredited investor" as such term is defined in Rule 501 as promulgated by the
SEC under the Securities Act.
8
<PAGE>
4. Covenants.
---------
4.1 Registration of Shares.
----------------------
(a) The Company shall, before the later of (i) 20 days after the
SEC declares effective the Company's Form S-3 registration statement for the
resale of the Common Stock issued by the Company in exchange for its Series B
Convertible Participating Preferred Stock, and (ii) 45 days following the
Closing, prepare and file with the SEC a registration statement on Form S-1
under the Securities Act covering the resale of the Shares by the Investor
(subject to Section 4.1(g), the "Registration Statement"), and corresponding
applications for registration under the blue sky laws of any states for which
the Investor reasonably requests in writing to the Company that the Company
obtain such blue-sky registration (it being understood that in the vast majority
of states no such registration is legally required, due to the Company's Nasdaq
National Market listing or other reasons). The Company shall use its reasonable
diligent efforts to obtain effectiveness of the Registration Statement and such
blue sky registrations as soon thereafter as practicable, and in any event
within 90 days after the initial filing of the Registration Statement with the
SEC, and shall use its best efforts to keep the Registration Statement and such
blue sky registrations effective after that. Notwithstanding the foregoing, the
Company will only be required to maintain the effectiveness of the Registration
Statement and such blue sky registrations until the earlier of (a) such time as
all of the Shares have been disposed of by the Investor, or (b) such date on
which the Investor may legally dispose of all of the Shares held by it in one
transaction in the open market pursuant to Rule 144(k) under the Securities Act.
The Company shall also cause the Shares to be listed on the Nasdaq National
Market and on any stock exchange on which the Common Stock may from time to time
be listed. The Company shall pay all fees and expenses incurred by the Company
in connection with preparing, filing, prosecuting and updating the Registration
Statement, such blue sky applications
9
<PAGE>
and registrations, and such listing, including all registration and filing fees,
listing fees, printing expenses, and fees and disbursements of the Company's
counsel and accountants.
(b) The Investor shall cooperate fully with the Company in the
preparation of such Registration Statement and blue sky applications and shall
provide to the Company all information and materials (including updated
information and materials) regarding itself and its proposed method of
disposition of the Shares and take all actions reasonably requested by the
Company to permit the Company to comply with applicable requirements of the SEC,
to comply with applicable requirements of the relevant blue sky laws, and to
obtain the desired acceleration of the effective date of such Registration
Statement.
(c) Subject to Section 4.1(d) hereof, the Company shall promptly
prepare and file with the SEC and any relevant blue sky authorities such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith as may be necessary to keep such Registration Statement
effective and to comply with (and enable the Investor to comply with) the
provisions of the Securities Act and Rule 415 thereunder with respect to the
disposition of all the Shares.
(d) During the effectiveness of the Registration Statement, the
Company shall promptly notify the Investor of the happening of any event or
other circumstance as the result of which, in the Company's judgment, (i) the
prospectus included in the Registration Statement, as then in effect, would
include an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing, or (ii) the offer or
resale of the Shares would otherwise have a material and adverse effect on any
proposed or pending acquisition, merger, business combination or other material
transaction involving the Company; and, upon
10
<PAGE>
receipt of such notice and until the earlier of (i) the date the Company makes
available to the Investor a supplemented or amended prospectus meeting the
requirements of the Securities Act and relevant blue sky laws, or (ii) the date
the Company notifies the Investor that the Investor may resume offers and sales
using the prior prospectus, the Investor shall not offer or sell any Shares
pursuant to the Registration Statement (and shall return all copies of such
prior prospectus to the Company if requested to do so by it). Notwithstanding
Section 4.1(c), the Company may continue such "blackout" period or periods for
such period of time as the Company considers reasonably necessary and in its
best interest due to circumstances then existing, or simply due to the fact that
amendments/supplements of a Registration Statement/ prospectus cannot be
prepared instantly; but in no event may the Company impose "blackouts" on
Investor for any period of ten or more consecutive business days or totaling
more than 20 days in any 12 month period (plus any "Permitted Blackouts" as
defined in the Registration Rights Agreement dated as of December 21, 1998
between the Company, Castle Creek Technology Partners LLC and others).
(e) The Company shall not be required to apply for or obtain
blue sky registration in any state if in connection therewith or as a condition
thereto it must (i) qualify to do business in such state where it would not
otherwise be required to qualify, (ii) subject itself to general taxation in
such state, (iii) file a general consent to service of process in such state, or
(iv) make any change in its Certificate of Incorporation or Bylaws, which the
Company's Board of Directors determines to be contrary to the best interests of
the Company and its stockholders.
(f) Indemnification.
---------------
(i) The Company will indemnify the Investor, and each of
the officers and directors of, and each person controlling, the Investor,
against all claims, losses,
11
<PAGE>
expenses, damages and liabilities (or actions in respect thereto) arising out of
or based on (A) any untrue statements (or alleged untrue statement) of a
material fact contained in any prospectus contained in any registration
statement covering the Shares for resale, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (B) any
misrepresentation or breach of any representation or warranty given or made by
the Company in this Agreement, and will reimburse the Investor, each of its
officers and directors and each person controlling the Investor, for any
reasonable legal and any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability or
action, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage or liability is caused by any untrue
statement or omission based upon written information furnished to the Company by
the Investor specifically for use therein.
(ii) The Investor will indemnify the Company, each of its
directors and officers, and each person who controls the Company within the
meaning of the Securities Act, against all claims, losses, expenses, damages and
liabilities (or actions in respect thereof) arising out of or based on (A) any
untrue statement (or alleged untrue statement) of a material fact contained in
any such prospectus, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (B) any sale of Shares which violates (or allegedly
violates) the Securities Act because of violation of the prospectus delivery
requirement or because more or less than the information in such prospectus is
given (or alleged to be given) in connection with the sale, or (C) any
misrepresentation or breach of any representation or warranty given or made by
the Investor in this Agreement, and will reimburse the Company, and such
directors, officers, or
12
<PAGE>
controlling persons, for any reasonable legal or any other expenses incurred in
connection with investigating, defending or settling any such claim, loss,
damage, liability or action, but in the case of subsection (f)(ii)(A) to the
extent, and only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such prospectus in
reliance upon and in conformity with written information furnished to the
Company by the Investor specifically for use therein.
(iii) Each party entitled to indemnification under this Section
4.1(f) (the "Indemnified Party") shall give notice to the party required to
provide indemnification (the "Indemnifying Party") promptly after such
indemnified party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not be
unreasonably withheld), and the Indemnified Party may participate in such
defense at the Indemnified Party's expense, and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations hereunder, unless such failure
resulted in actual detriment to the Indemnifying Party. The Indemnified Party
shall provide all cooperation reasonably requested for the defense of the claim
or litigation. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation. An Indemnified Party shall not decline any settlement complying with
the foregoing if it requires nothing of the Indemnified
13
<PAGE>
Party other than the payment of money (which is in fact paid by the Indemnifying
Party) and does not include an admission of liability.
(iv) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which any person or
entity entitled to indemnification under Section 4.1(f) makes a claim for
indemnification pursuant to this Section 4.1(f) but it is judicially determined
(by entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 4.1(f) provides for indemnification in such case; then, and in
such case, the party that would otherwise be required to indemnify under Section
4.1(f) will contribute to the aggregate losses, claims, damages or liabilities
to which the other parties may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the parties
in connection with the losses suffered, as well as any other relevant equitable
considerations.
(g) The parties agree that if the Company becomes eligible to
register securities for resale on Form S-3 it may choose to register the Shares
for resale on Form S-3 and, after the SEC declares such Form S-3 registration
statement effective, so notify the Investor, provide all relevant deliverables
(such as a supply of new prospectuses), and then deregister the Shares from the
original Form S-1 Registration Statement. Thereafter such Form S-3 Registration
Statement shall, for all purposes of this Agreement, be deemed to be the
"Registration Statement."
4.2 Deliverables Upon Effectiveness. When and if the SEC declares the
-------------------------------
Registration Statement effective, the Company shall promptly deliver to the
Investor:
14
<PAGE>
(a) A certificate signed by the President of the Company and
that the Registration Statement is effective and, to his knowledge, no stop
order with respect to the Registration Statement has been issued and no
proceedings therefor have been instituted.
(b) A legal opinion of Brobeck, Phleger & Harrison LLP, counsel
to the Company, in substantially the form of Exhibit B.
(c) Such number of copies of the Registration Statement and
(from time to time) of each amendment and supplement thereto, such number of
copies of the prospectus (including (from time to time) any supplemental or
amended prospectus) included in such Registration Statement, and such other
related documents as the Investor may reasonably request in writing in order to
facilitate the disposition of the Shares by the Investor.
4.3 Current Public Information. As long as the Investor owns any
--------------------------
Shares, the Company shall use its best efforts to properly file all SEC Reports,
or otherwise make available "adequate current public information" about itself,
within the meaning of Rule 144(c) under the Securities Act, to potentially make
available to the Investor the benefits of certain rules and regulations of the
SEC which may permit the sale of the Shares without registration.
5. Conditions of the Investor's Obligations at Closing.The obligations of
---------------------------------------------------
the Investor under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Investor:
5.1 Bringdown. The Company's representations and warranties in
---------
Section 2 shall be true in all material respects, as if made on and as of the
date of the Closing. The Company shall have performed or fulfilled in all
material respects all agreements, obligations and conditions contained herein
required to be performed or fulfilled by the Company before such Closing.
15
<PAGE>
5.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
5.3 Compliance Certificate. The Company shall have delivered to the
----------------------
Investor a certificate dated as of the date of the Closing signed by the Chief
Executive Officer or President of the Company certifying that, to his knowledge,
the conditions set forth in Sections 5.1, 5.2, 5.5, 5.6, and 5.7 have been
satisfied.
5.4 Opinion of Counsel. There shall have been delivered to the
------------------
Investor an opinion of Brobeck, Phleger & Harrison LLP, counsel to the Company,
in substantially the form of Exhibit A.
5.5 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
5.6 No Material Litigation. During the period from the date of this
----------------------
Agreement to the Closing, no material litigation shall have been initiated
challenging the Company's ownership or its right to use or distribute the core
technology of the Company's products, and the Company shall have not received
any written threat of such litigation or any written claim so challenging the
Company's rights.
5.7 No Fraud or Malfeasance. During the period from the date of this
-----------------------
Agreement to the Closing, (a) none of the Company's officers or directors shall
have been removed for fraud or malfeasance in performance of his or her duties
with respect to the affairs of the Company and (b) no new legal proceedings
against any officers or directors of the Company for fraud or malfeasance in the
performance of his or her duties with respect to the affairs of the Company
shall have been instituted by the Company or its stockholders.
16
<PAGE>
6. Conditions of the Company's Obligations at Closing. The obligations of
--------------------------------------------------
the Company under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Company:
6.1 Bringdown. The Investor's representations and warranties in
---------
Section 3 shall be true in all material respects, as if made on and as of the
date of the Closing.
6.2 Blue Sky Compliance. The Company shall be exempt from or
-------------------
have complied with the registration/qualification requirements of and be
effective under all blue sky laws applicable to the offer and sale of the Shares
to the Investor.
6.3 No Order Pending. There shall not then be in effect any
----------------
order enjoining or restraining the transactions contemplated by this Agreement.
7. Miscellaneous.
-------------
7.1 Entire Agreement. This Agreement constitutes the entire
----------------
contract between the Company and the Investor relative to the subject matter
hereof. Any previous or contemporaneous agreements, understandings, promises and
representations (whether written or oral) with regard to such subject between
the Company and the Investor are superseded by this Agreement.
7.2 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of California applicable to
contracts entered into and wholly to be performed within the State of California
by California residents.
7.3 Counterparts. This Agreement may be executed in
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
17
<PAGE>
7.4 Headings. The headings of the Sections and subsections of
--------
this Agreement are for convenience and shall not determine the interpretation of
this Agreement.
7.5 Notices. Any notice required or permitted hereunder shall
-------
be given in writing and shall be conclusively deemed effectively given upon
personal delivery, or, if made by registered or certified United States mail,
postage prepaid, four business days after mailing, or if made by overnight
carrier, one business day after sending, in all instances addressed (i) if to
the Company, as set forth below the Company's name on the signature page of this
Agreement, and (ii) if to the Investor, as set forth below the Investor's name
on the signature page to this Agreement, or at such other address as the Company
or the Investor may designate by ten days' advance written notice to the
Investor or the Company, respectively.
7.6 Survival of Warranties. The representations and warranties
----------------------
of the parties contained in or made pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the Closing for three years;
provided, however, that such representations and warranties need only be
accurate as of the date of such execution and delivery.
7.7 Amendment of Agreement. Any provision of this Agreement may
----------------------
be modified or amended, at any time, by a written instrument signed by the
Company and by the Investor, and not in any other way.
7.8 Fees and Expenses. The Company and the Investor will each
-----------------
bear their own fees and expenses in connection with the transactions
contemplated by this Agreement.
7.9 Finders' Fees. The Company will hold the Investor harmless
-------------
from all finders' or brokers' fees in connection with the sale of the Shares to
the Investor.
18
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
PIPES Purchase Agreement as of the day and year first above written.
P-COM, INC., a Delaware corporation
By: /s/ George P. Roberts
___________________________
Title: Chief Executive Officer
___________________________
Address: 3175 S. Winchester Boulevard
Campbell, CA 95008
Attention: Chief Financial Officer
LAGUNITAS PARTNERS LP, a California limited
partnership
By: /s/ Thomas O'Lloyd-Butler
--------------------------------
Title: Member Manager of Gruber McBaine
--------------------------------
Capital Management LLC
--------------------------------
as General Partner of Lagunitas
--------------------------------
Address: c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
19
<PAGE>
EXHIBIT A
June 22, 1999
Lagunitas Partners LP
c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of shares of its
common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you. This opinion letter is being rendered to you pursuant to
Section 5.4 of the Stock Purchase Agreement in connection with the Closing of
the sale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In connection with the opinions expressed herein, we have made such
examination of matters of law and of fact as we considered appropriate or
advisable for purposes hereof. As to matters of fact material to the opinions
expressed herein, we have relied upon the representations and warranties as to
factual matters contained in and made by the Company pursuant to the Stock
Purchase Agreement and upon certificates and statements of government officials
and of officers of the Company. We have also examined originals or copies of
such corporate documents or records of the Company as we have considered
appropriate for the opinions expressed herein. We have assumed for the purposes
of this opinion letter the genuineness of all signatures, the legal capacity of
natural persons, the authenticity of the documents submitted to us as originals,
the conformity to the original documents of all documents submitted to us as
certified, facsimile or photostatic copies, and the authenticity of the
originals of such copies.
In rendering this opinion letter we have also assumed: (A) that the Stock
Purchase Agreement has been duly and validly executed and delivered by you or on
your behalf, that you have the power to enter into and perform all your
obligations thereunder, and that the Stock Purchase Agreement constitutes a
valid, legal, binding and enforceable obligation upon you; (B) that the
representations and warranties made in the Stock Purchase Agreement by you are
true and correct; and (C) that any wire transfers, drafts or checks tendered by
you will be honored.
As used in this opinion letter, the expression "we are not aware" or the
phrase "to our knowledge", or any similar expression or phrase with respect to
our knowledge of matters of fact, means as to matters of fact that, based on the
actual knowledge of individual attorneys within the firm principally responsible
for handling current matters for the Company (and not including any constructive
or imputed notice of any information), and after an examination of
20
<PAGE>
documents referred to herein and after inquiries of certain officers of the
Company, no facts have been disclosed to us that have caused us to conclude that
the opinions expressed are factually incorrect; but beyond that we have made no
factual investigation for the purposes of rendering this opinion letter.
Specifically, but without limitation, we have not searched the dockets of any
courts and we have made no inquiries of securities holders or employees of the
Company, other than such officers.
This opinion letter relates solely to the laws of the State of California,
the General Corporation Law of the State of Delaware and the federal law of the
United States and we express no opinion with respect to the effect or
application of any other laws. Special rulings of authorities administering such
laws or opinions of other counsel have not been sought or obtained.
Based upon our examination of and reliance upon the foregoing and subject
to the limitations, exceptions, qualifications and assumptions set forth below
and except as set forth in the Stock Purchase Agreement or the Disclosure
Schedule thereto, we are of the opinion that as of the date hereof:
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, and the Company has
the requisite corporate power and authority to own its properties and to conduct
its business as, to our knowledge, it is presently conducted. The Company is
qualified to do business as a foreign corporation in the state of California.
2. The Company has the requisite corporate power and authority to
execute, deliver and perform the Stock Purchase Agreement. The Stock Purchase
Agreement has been duly and validly authorized by the Company, duly executed and
delivered by an authorized officer of the Company and constitutes a legal, valid
and binding obligation of the Company, enforceable by you against the Company in
accordance with its terms.
3. The Shares have been duly authorized and, upon purchase at the Closing
pursuant to the terms of the Stock Purchase Agreement, will be validly issued,
nonassessable and fully paid, and free of any liens created by the Company.
4. The Company's execution and delivery of, and its performance and
compliance as of the date hereof with the terms of, the Stock Purchase Agreement
do not violate any provision of any federal, Delaware corporate or California
law, rule or regulation applicable to the Company or any provision of the
Company's Restated Certificate of Incorporation or Bylaws and do not conflict
with or constitute a default under the provisions of any judgment, writ, decree
or order specifically identified in the SEC Reports or the material provisions
of any of the material agreements specifically identified in the SEC Reports.
5. Other than in connection with any securities laws, all consents,
approvals, permits, orders or authorizations of, and all qualifications by and
registrations with, any federal or Delaware corporate or California state
governmental authority on the part of the Company required in connection with
the execution and delivery of the Stock Purchase Agreement and
A-2
<PAGE>
consummation at the Closing of the transactions contemplated by the Stock
Purchase Agreement have been obtained, and are effective, and we are not aware
of any proceedings, or written threat of any proceedings, that question the
validity thereof.
6. Based in part upon the representations of you in the Stock Purchase
Agreement, the offer and sale of the Shares to you pursuant to the terms of the
Stock Purchase Agreement are exempt from the registration requirements of
Section 5 of the Securities Act of 1933, as amended, and from the qualification
requirements of the California Corporate Securities Law of 1968, as amended.
Our opinions expressed above are specifically subject to the following
limitations, exceptions, qualifications and assumptions:
(A) The legality, validity, binding nature and enforceability of the
Company's obligations under the Stock Purchase Agreement may be subject to or
limited by (1) bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent transfer and other similar laws affecting the rights of creditors
generally; (2) general principles of equity (whether relief is sought in a
proceeding at law or in equity), including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the discretion of
any court of competent jurisdiction in awarding specific performance or
injunctive relief and other equitable remedies; and (3), without limiting the
generality of the foregoing, the effect of California court decisions and
statutes which indicate that provisions of the Stock Purchase Agreement which
permit you to take action or make determinations may be subject to a requirement
that such action be taken or such determinations be made on a reasonable basis
in good faith or that it be shown that such action is reasonably necessary for
your protection.
(B) We express no opinion as to the Company's compliance or noncompliance
with applicable federal or state antifraud or antitrust statutes, laws, rules
and regulations.
(C) We express no opinion concerning the past, present or future fair
market value of any securities.
(D) We express no opinion as to the enforceability under certain
circumstances of any provisions indemnifying a party against, or requiring
contributions toward, that party's liability for its own wrongful or negligent
acts, or where indemnification or contribution is contrary to public policy or
prohibited by law. In this regard, we advise you that in the opinion of the
Securities and Exchange Commission, indemnification of directors, officers and
controlling persons of an issuer against liabilities arising under the
Securities Act of 1933, as amended, is against public policy and is therefore
unenforceable.
(E) We express no opinion as to the enforceability under certain
circumstances of any provisions prohibiting waivers of any terms of the Stock
Purchase Agreement other than in writing, or prohibiting oral modifications
thereof or modification by course of dealing. In addition, our opinions are
subject to the effect of judicial decisions which may permit the introduction of
extrinsic evidence to interpret the terms of written contracts.
A-3
<PAGE>
(F) We express no opinion as to the effect of Section 1670.5 of the
California Civil Code or any other California law, federal law or equitable
principle which provides that a court may refuse to enforce, or may limit the
application of, a contract or any clause thereof which the court finds to have
been unconscionable at the time it was made or contrary to public policy.
(G) We express no opinion as to your compliance with any Federal or state
law relating to your legal or regulatory status.
(H) We express no opinion as to the compliance of the Company, the
Investor or the sale of the Common Stock to the Investor with the provisions of
the Small Business Investment Act of 1958, as amended, or any of the regulations
promulgated thereunder.
(I) We express no opinion as to the effect of subsequent issuances of
securities of the Company, to the extent that further issuances which may be
integrated with the Closing may include purchasers that do not meet the
definition of "accredited investors" under Rule 501 of Regulation D and
equivalent definitions under state securities or "blue sky" laws.
(J) We express no opinion as to Section 7.2 of the Stock Purchase
Agreement to the extent that it purports to exclude conflict of law principles
under California law.
(K) With your permission, we express no opinion regarding the Hart-Scott-
Rodino Antitrust Improvements Act of 1976.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and may not be
delivered to, quoted or relied upon by any person other than you, or for any
other purpose, without our prior written consent. Our opinion is expressly
limited to the matters set forth above and we render no opinion, whether by
implication or otherwise, as to any other matters relating to the Company or the
Shares. We assume no obligation to advise you of facts, circumstances, events or
developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
A-4
<PAGE>
EXHIBIT B
_____________, 1999
Lagunitas Partners LP
c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of certain Shares of
its common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you and in connection with the Company's registration with the
SEC of such Shares for resale by you. This opinion letter is being rendered to
you pursuant to Section 4.2(b) of the Stock Purchase Agreement in connection
with the SEC declaring effective the Registration Statement for your resale of
the Shares. Capitalized terms not otherwise defined in this opinion letter have
the meanings given them in the Stock Purchase Agreement.
In our capacity as counsel to the Company, we have examined, among other
things, originals, or copies identified to our satisfaction as being true
copies, of the Registration Statement on Form S-1 (File No. 333-____________)
initially filed by the Company with the SEC on ____________, 1999, for the
purpose of registering the resale of the Shares under the Securities Act;
Amendment No. 1 to such Registration Statement filed with the SEC on
_____________, 1999; Amendment No. 2 to such Registration Statement filed with
the SEC on _____________, 1999; and oral advice on ______________, 1999, from an
SEC staff examiner, that the SEC had declared such Registration Statement, as so
amended, effective as of ______ p.m., Washington, D.C. time, on _____________,
1999.
As used in this opinion letter, the phrase "to our knowledge" means as to
matters of fact that, based on the actual knowledge of individual attorneys
within the firm principally responsible for handling current matters for the
Company (and not including any constructive or imputed notice of any
information), no facts have been disclosed to us that have caused us to conclude
that the opinions expressed are factually incorrect; but our affirmative factual
investigation for the purpose of rendering this opinion letter has been limited
to obtaining (a) oral advice received on ___________, from an SEC staff
examiner, that the SEC had declared such Registration Statement, as amended,
effective at _____ p.m. Washington, D.C. time, on _________ , 1999 and (b) oral
advice received on ___________, 1999 from an SEC staff examiner that there is no
stop order suspending the effectiveness of the Registration Statement.
Based upon our examination of and reliance upon the foregoing, we are of
the opinion that as of the date hereof:
<PAGE>
1. The Registration Statement has become effective under the Securities
Act and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose are
pending before or contemplated by the SEC.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and the
Registration Statement and may not be delivered to, quoted or relied upon by any
person other than you, or for any other purpose, without our prior written
consent. Our opinion is expressly limited to the matters set forth above and we
render no opinion, whether by implication or otherwise, as to any other matters
relating to the Company, the Stock Purchase Agreement, the Registration
Statement or the Shares. We assume no obligation to advise you of facts,
circumstances, events or developments which hereafter may be brought to our
attention and which may alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
B-2
<PAGE>
EXHIBIT 10.49
COMMON STOCK PIPES PURCHASE AGREEMENT
THIS COMMON STOCK PIPES PURCHASE AGREEMENT (the "Agreement") is made as of
June 21, 1999, by and between P-Com, Inc., a Delaware corporation (the
"Company"), and Gruber McBaine International, a Cayman Islands corporation (the
"Investor").
RECITALS:
--------
A. The Company desires to sell shares of the Company's Common Stock,
$.0001 par value ("Common Stock") to the Investor, and the Investor desires to
purchase shares of Common Stock, on the terms and subject to the conditions set
forth in this Agreement.
THE PARTIES AGREE AS FOLLOWS:
1. Purchase and Sale of Common Stock.
---------------------------------
1.1 Sale and Issuance of Common Stock. The Company shall sell to the
---------------------------------
Investor and the Investor shall purchase from the Company, on the date of the
Closing (as defined in Section 1.2 below), at a price per share equal to the
Formula Price (as defined in Section 1.3 below), that number of shares of Common
Stock equal to the quotient of $625,000 divided by the Formula Price (the
"Shares").
1.2 Closing. The purchase and sale of the Shares shall take place at
-------
11:00 a.m. Pacific Daylight Time on June 22, 1999, at the offices of Brobeck,
Phleger & Harrison LLP, 550 West "C" Street, San Diego, California 92101, or on
such date and at such time and place as the Company and the Investor shall
mutually agree (the "Closing"). At the Closing the Company shall deliver to the
Investor a stock certificate representing the Shares against delivery to the
Company by the Investor of $625,000 by wire transfer to the Company.
1.3 Formula Price. The "Formula Price" means the product of 92.5%
-------------
times the mean average of the 15 closing sale prices of the Common Stock, as
reported by the Nasdaq
<PAGE>
National Market, for the 15 consecutive trading days ending on and including
June 17, 1999; i.e., the Formula Price is $3.973.
2. Representations and Warranties of the Company. For purposes of this
---------------------------------------------
Section 2, unless the context otherwise requires, the term "Company" shall
include the Company and its subsidiaries as listed in its most recent Annual
Report on Form 10-K/A for the year ended December 31, 1998 (the "Annual Report")
filed with the Securities and Exchange Commission (the "SEC"). Except as set
forth in the Disclosure Schedule delivered to the Investor supplementally (the
"Disclosure Schedule"), the Company hereby represents and warrants to the
Investor as follows:
2.1 Corporate Organization and Authority of the Company. The Company
---------------------------------------------------
and each of its subsidiaries:
(a) is a corporation duly organized, validly existing,
authorized to exercise all its corporate powers, rights and privileges and in
good standing in the state or jurisdiction of its incorporation;
(b) has the corporate power and authority to own and operate its
properties and to carry on its business as presently conducted and as proposed
to be conducted; and
(c) is qualified to do business as a foreign corporation in each
jurisdiction in which the ownership of its property or the nature of its
business requires such qualification, except where failure to so qualify would
not have a materially adverse effect on the business, properties or financial
condition of the Company and its subsidiaries, taken as a whole. The Company has
furnished to the Investor true and correct copies of its Certificate of
Incorporation and Bylaws, each as amended to date.
2
<PAGE>
2.2 Capitalization. The authorized capital stock of the Company
--------------
consists of:
(a) Preferred Stock. 2,000,000 shares of Preferred Stock,
---------------
$.0001 par value, 750,000 shares of which have been designated Series A Junior
Participating Preferred Stock, of which none were issued and outstanding as of
June 21, 1999.
(b) Common Stock. 95,000,000 shares of Common Stock, $.0001 par
------------
value, of which 54,101,545 shares were issued and outstanding as of June 21,
1999.
(c) All outstanding shares of the Company's Common Stock have
been duly authorized and validly issued (including, without limitation, issued
in compliance with applicable federal and state securities laws), and are fully
paid and nonassessable.
(d) Since June 21, 1999, the Company has not issued any shares
of Common Stock or Preferred Stock except in connection with the exercise of
outstanding options or warrants. Except as described in the Disclosure Schedule,
there are no options, warrants, conversion privileges or other contractual
rights presently outstanding to purchase or otherwise acquire from the Company
any shares of the Company's capital stock or other securities (whether or not
authorized).
2.3 Subsidiaries. The Company does not presently own, have any
------------
investment in, or control, directly or indirectly, any subsidiaries,
associations or other business entities, except as disclosed in the Annual
Report. The Company is not a participant in any joint venture or partnership,
except as disclosed in the Annual Report.
2.4 Authorization. All corporate action on the part of the Company,
-------------
its officers, directors and stockholders necessary for the authorization,
execution, delivery and performance by the Company of all its obligations under
this Agreement and for the authorization, issuance, sale and delivery of the
Shares has been taken, and this Agreement, once
3
<PAGE>
executed by the Company and the Investor, will constitute a legally binding and
valid obligation of the Company enforceable in accordance with its terms, such
enforceability being subject only to laws of general application relating to
bankruptcy, insolvency and the relief of debtors and rules of law governing
specific performance, injunctive relief or other equitable remedies. Except for
rights, if any, which have been duly waived, the issuance and sale of the Shares
will not give rise to any preemptive rights or rights of first refusal on behalf
of any person in existence on the date hereof.
2.5 Validity of Shares. The Shares, when issued, sold and delivered
------------------
in accordance with the terms and for the consideration expressed in this
Agreement, shall be duly and validly issued (including, without limitation,
compliance with applicable federal and state securities laws), fully paid and
nonassessable.
2.6 No Conflict. The execution and delivery of this Agreement do not,
-----------
and the consummation of the transactions contemplated hereby will not, conflict
with, or result in any violation of, or default (with or without notice or lapse
in time, or both) under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to a loss of a material benefit under, any
provision of the Certificate of Incorporation or Bylaws of the Company. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated hereby will not, conflict with, or result in any
violation of, or default (with or without notice or lapse in time, or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation or to a loss of a material benefit under, any provision of any
mortgage, indenture, lease or other agreement or instrument, permit, concession,
franchise, license, judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to the Company, its properties or assets, the effect of
which could have a material adverse effect on the
4
<PAGE>
Company or materially impair or restrict its power to perform its obligations as
contemplated hereby.
2.7 Accuracy of Reports. The Annual Report, the Company's quarterly
-------------------
report on Form 10-Q for the quarter ended March 31, 1999 filed with the SEC (the
"Quarterly Report"), and all reports required to be filed by the Company
thereafter to the date of this Agreement under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), copies of which have been furnished to
the Investor (together, the "SEC Reports"), have been duly filed, were (as
amended to date) complete and correct in all material respects as of the dates
at which the information was furnished, and (as amended to date) contained (as
of such dates) no untrue statement of a material fact nor omitted to state a
material fact necessary in order to make the statements made therein, in light
of the circumstances in which they were made, not misleading.
2.8 Changes. Except as otherwise disclosed herein, in the Disclosure
-------
Schedule or in the SEC Reports, between March 31, 1999 and the date of this
Agreement there has not been:
(a) any change in the assets, liabilities, financial condition,
prospects or operations of the Company from that reflected in the Quarterly
Report, except changes in the ordinary course of business which have not
been, either in any individual case or in the aggregate, materially
adverse;
(b) any material change in the contingent obligations of the
Company, whether by way of guaranty, endorsement, indemnity, warranty or
otherwise;
(c) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties or business of
the Company;
5
<PAGE>
(d) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(e) any labor organization activity; or
(f) to the best of the Company's knowledge, any other event or
condition of any character which has materially and adversely affected the
Company's assets, liabilities, financial condition, prospects or operations.
2.9 Government Consent, etc. No consent, approval or authorization
------------------------
of or designation, declaration or filing with any governmental authority on the
part of the Company is required in connection with the valid execution and
delivery of this Agreement, or the offer, sale or issuance of the Shares, or the
consummation of any other transaction contemplated hereby, except the filing of
a Registration Statement and related activities pursuant to Section 4 hereof.
2.10 Full Disclosure. The representations and warranties of the
---------------
Company contained in this Agreement, when read together with the Disclosure
Schedule and the SEC Reports, do not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements contained herein, in light of the circumstances under which they were
made, not misleading.
2.11 Conflicts Prohibited. The Company represents, warrants and
--------------------
covenants that to the best of its knowledge no officer or employee of Investor
has a direct or indirect economic interest in the Company or its property or
contracts other than as disclosed in the SEC Reports, nor will any officer or
employee of Investor receive, directly or indirectly, anything of substantial
economic value for his or her private benefit from the Company or anyone acting
on its behalf in connection with the investment made pursuant to this Agreement.
6
<PAGE>
2.12 Intellectual Property. The Company has not violated and is not
---------------------
currently in violation of any copyright, trademark or other intellectual
property rights of any third persons, except to the extent that such violation
does not materially and adversely affect the Company or its operations.
2.13 Litigation/Bankruptcy/Malfeasance. The Company is not the
---------------------------------
subject of and has not received notice of any legal proceedings of the following
types to which the Company is a party (or, if applicable, any executive officer
or director of the Company) or any of its property is the subject: any
proceeding that involves a claim against the Company for damages in excess of
$500,000; any material bankruptcy, receivership or similar proceedings with
respect to the Company; or any criminal proceedings or civil proceedings for
fraud or malfeasance of which a director or executive officer of the Company is
the subject (excluding minor offenses).
3. Representations and Warranties of the Investor. The Investor
----------------------------------------------
represents and warrants to the Company as follows:
3.1 Organization. It is a corporation validly existing under the
------------
laws of the Cayman Islands, with all requisite power and authority to conduct
its business as now being conducted.
3.2 Authority. It has all corporate right, power and authority to
---------
enter into this Agreement and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by the Investor and the
consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary corporate action on behalf of the Investor. This
Agreement has been duly executed and delivered by and constitutes a legal,
7
<PAGE>
valid and binding obligation of the Investor, enforceable in accordance with its
terms, subject to laws of general application relating to bankruptcy, insolvency
and the relief of debtors and rules of law governing specific performance,
injunctive relief or other equitable remedies. The execution and delivery of
this Agreement do not, and the consummation of the transactions contemplated
hereby will not, conflict with or result in any violation of any obligation
under any provision of the authorization statute or organizational or other
charter documents of the Investor or any judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to the Investor.
3.3 Information. The Investor represents that it has received all the
-----------
information it has requested from the Company and considers necessary or
appropriate for deciding whether to purchase the Shares. The delivery of any
information by the Company to the Investor shall not abrogate the
representations and warranties of the Company contained herein.
3.4 No Current Resale. The Investor is acquiring the Shares for its
-----------------
own account and not with a view to sale or distribution. Any such sale or
distribution shall be made only in compliance with the provisions of the
Securities Act of 1933, as amended (the "Securities Act") and all applicable
blue sky laws. The Investor acknowledges that the Shares are not now registered
under the Securities Act or any blue sky law, and might never be so registered.
The Investor further acknowledges that the stock certificate representing the
Shares will bear a customary securities-law restrictive legend.
3.5 Status of Investor (Regulation D and HSR). The Investor is an
-----------------------------------------
"accredited investor" as such term is defined in Rule 501 as promulgated by the
SEC under the Securities Act.
8
<PAGE>
4. Covenants.
---------
4.1 Registration of Shares.
----------------------
(a) The Company shall, before the later of (i) 20 days after the
SEC declares effective the Company's Form S-3 registration statement for the
resale of the Common Stock issued by the Company in exchange for its Series B
Convertible Participating Preferred Stock, and (ii) 45 days following the
Closing, prepare and file with the SEC a registration statement on Form S-1
under the Securities Act covering the resale of the Shares by the Investor
(subject to Section 4.1(g), the "Registration Statement"), and corresponding
applications for registration under the blue sky laws of any states for which
the Investor reasonably requests in writing to the Company that the Company
obtain such blue-sky registration (it being understood that in the vast majority
of states no such registration is legally required, due to the Company's Nasdaq
National Market listing or other reasons). The Company shall use its reasonable
diligent efforts to obtain effectiveness of the Registration Statement and such
blue sky registrations as soon thereafter as practicable, and in any event
within 90 days after the initial filing of the Registration Statement with the
SEC, and shall use its best efforts to keep the Registration Statement and such
blue sky registrations effective after that. Notwithstanding the foregoing, the
Company will only be required to maintain the effectiveness of the Registration
Statement and such blue sky registrations until the earlier of (a) such time as
all of the Shares have been disposed of by the Investor, or (b) such date on
which the Investor may legally dispose of all of the Shares held by it in one
transaction in the open market pursuant to Rule 144(k) under the Securities Act.
The Company shall also cause the Shares to be listed on the Nasdaq National
Market and on any stock exchange on which the Common Stock may from time to time
be listed. The Company shall pay all fees and expenses incurred by the Company
in connection with preparing, filing, prosecuting and updating the Registration
Statement, such blue sky applications
9
<PAGE>
and registrations, and such listing, including all registration and filing fees,
listing fees, printing expenses, and fees and disbursements of the Company's
counsel and accountants.
(b) The Investor shall cooperate fully with the Company in the
preparation of such Registration Statement and blue sky applications and shall
provide to the Company all information and materials (including updated
information and materials) regarding itself and its proposed method of
disposition of the Shares and take all actions reasonably requested by the
Company to permit the Company to comply with applicable requirements of the SEC,
to comply with applicable requirements of the relevant blue sky laws, and to
obtain the desired acceleration of the effective date of such Registration
Statement.
(c) Subject to Section 4.1(d) hereof, the Company shall promptly
prepare and file with the SEC and any relevant blue sky authorities such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith as may be necessary to keep such Registration Statement
effective and to comply with (and enable the Investor to comply with) the
provisions of the Securities Act and Rule 415 thereunder with respect to the
disposition of all the Shares.
(d) During the effectiveness of the Registration Statement, the
Company shall promptly notify the Investor of the happening of any event or
other circumstance as the result of which, in the Company's judgment, (i) the
prospectus included in the Registration Statement, as then in effect, would
include an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing, or (ii) the offer or
resale of the Shares would otherwise have a material and adverse effect on any
proposed or pending acquisition, merger, business combination or other material
transaction involving the Company; and, upon
10
<PAGE>
receipt of such notice and until the earlier of (i) the date the Company makes
available to the Investor a supplemented or amended prospectus meeting the
requirements of the Securities Act and relevant blue sky laws, or (ii) the date
the Company notifies the Investor that the Investor may resume offers and sales
using the prior prospectus, the Investor shall not offer or sell any Shares
pursuant to the Registration Statement (and shall return all copies of such
prior prospectus to the Company if requested to do so by it). Notwithstanding
Section 4.1(c), the Company may continue such "blackout" period or periods for
such period of time as the Company considers reasonably necessary and in its
best interest due to circumstances then existing, or simply due to the fact that
amendments/supplements of a Registration Statement/ prospectus cannot be
prepared instantly; but in no event may the Company impose "blackouts" on the
---
Investor for any period of ten or more consecutive business days or totaling
more than 20 days in any 12 month period (plus any "Permitted Blackouts" as
defined in the Registration Rights Agreement dated as of December 21, 1998
between the Company, Castle Creek Technology Partners LLC and others).
(e) The Company shall not be required to apply for or obtain
blue sky registration in any state if in connection therewith or as a condition
thereto it must (i) qualify to do business in such state where it would not
otherwise be required to qualify, (ii) subject itself to general taxation in
such state, (iii) file a general consent to service of process in such state, or
(iv) make any change in its Certificate of Incorporation or Bylaws, which the
Company's Board of Directors determines to be contrary to the best interests of
the Company and its stockholders.
(f) Indemnification.
---------------
(i) The Company will indemnify the Investor, and each of
the officers and directors of, and each person controlling, the Investor,
against all claims, losses,
11
<PAGE>
expenses, damages and liabilities (or actions in respect thereto) arising out of
or based on (A) any untrue statements (or alleged untrue statement) of a
material fact contained in any prospectus contained in any registration
statement covering the Shares for resale, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (B) any
misrepresentation or breach of any representation or warranty given or made by
the Company in this Agreement, and will reimburse the Investor, each of its
officers and directors and each person controlling the Investor, for any
reasonable legal and any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability or
action, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage or liability is caused by any untrue
statement or omission based upon written information furnished to the Company by
the Investor specifically for use therein.
(ii) The Investor will indemnify the Company, each of its
directors and officers, and each person who controls the Company within the
meaning of the Securities Act, against all claims, losses, expenses, damages and
liabilities (or actions in respect thereof) arising out of or based on (A) any
untrue statement (or alleged untrue statement) of a material fact contained in
any such prospectus, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (B) any sale of Shares which violates (or allegedly
violates) the Securities Act because of violation of the prospectus delivery
requirement or because more or less than the information in such prospectus is
given (or alleged to be given) in connection with the sale, or (C) any
misrepresentation or breach of any representation or warranty given or made by
the Investor in this Agreement, and will reimburse the Company, and such
directors, officers, or
12
<PAGE>
controlling persons, for any reasonable legal or any other expenses incurred in
connection with investigating, defending or settling any such claim, loss,
damage, liability or action, but in the case of subsection (f)(ii)(A) to the
extent, and only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such prospectus in
reliance upon and in conformity with written information furnished to the
Company by the Investor specifically for use therein.
(iii) Each party entitled to indemnification under this
Section 4.1(f) (the "Indemnified Party") shall give notice to the party required
to provide indemnification (the "Indemnifying Party") promptly after such
indemnified party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not be
unreasonably withheld), and the Indemnified Party may participate in such
defense at the Indemnified Party's expense, and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations hereunder, unless such failure
resulted in actual detriment to the Indemnifying Party. The Indemnified Party
shall provide all cooperation reasonably requested for the defense of the claim
or litigation. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation. An Indemnified Party shall not decline any settlement complying with
the foregoing if it requires nothing of the Indemnified
13
<PAGE>
Party other than the payment of money (which is in fact paid by the Indemnifying
Party) and does not include an admission of liability.
(iv) In order to provide for just and equitable
contribution to joint liability under the Securities Act in any case in which
any person or entity entitled to indemnification under Section 4.1(f) makes a
claim for indemnification pursuant to this Section 4.1(f) but it is judicially
determined (by entry of a final judgment or decree by a court of competent
jurisdiction and the expiration of time to appeal or the denial of the last
right of appeal) that such indemnification may not be enforced in such case
notwithstanding the fact that this Section 4.1(f) provides for indemnification
in such case; then, and in such case, the party that would otherwise be required
to indemnify under Section 4.1(f) will contribute to the aggregate losses,
claims, damages or liabilities to which the other parties may be subject (after
contribution from others) in such proportion as is appropriate to reflect the
relative fault of the parties in connection with the losses suffered, as well as
any other relevant equitable considerations.
(g) The parties agree that if the Company becomes eligible to
register securities for resale on Form S-3 it may choose to register the Shares
for resale on Form S-3 and, after the SEC declares such Form S-3 registration
statement effective, so notify the Investor, provide all relevant deliverables
(such as a supply of new prospectuses), and then deregister the Shares from the
original Form S-1 Registration Statement. Thereafter such Form S-3 Registration
Statement shall, for all purposes of this Agreement, be deemed to be the
"Registration Statement."
4.2 Deliverables Upon Effectiveness. When and if the SEC declares the
-------------------------------
Registration Statement effective, the Company shall promptly deliver to the
Investor:
14
<PAGE>
(a) A certificate signed by the President of the Company and
that the Registration Statement is effective and, to his knowledge, no stop
order with respect to the Registration Statement has been issued and no
proceedings therefor have been instituted.
(b) A legal opinion of Brobeck, Phleger & Harrison LLP, counsel
to the Company, in substantially the form of Exhibit B.
(c) Such number of copies of the Registration Statement and
(from time to time) of each amendment and supplement thereto, such number of
copies of the prospectus (including (from time to time) any supplemental or
amended prospectus) included in such Registration Statement, and such other
related documents as the Investor may reasonably request in writing in order to
facilitate the disposition of the Shares by the Investor.
4.3 Current Public Information. As long as the Investor owns any
--------------------------
Shares, the Company shall use its best efforts to properly file all SEC Reports,
or otherwise make available "adequate current public information" about itself,
within the meaning of Rule 144(c) under the Securities Act, to potentially make
available to the Investor the benefits of certain rules and regulations of the
SEC which may permit the sale of the Shares without registration.
5. Conditions of the Investor's Obligations at Closing. The obligations
---------------------------------------------------
of the Investor under Section 1 of this Agreement are subject to the fulfillment
at or before the Closing of each of the following conditions, any of which may
be waived in writing by the Investor:
5.1 Bringdown. The Company's representations and warranties in
---------
Section 2 shall be true in all material respects, as if made on and as of the
date of the Closing. The Company shall have performed or fulfilled in all
material respects all agreements, obligations and conditions contained herein
required to be performed or fulfilled by the Company before such Closing.
15
<PAGE>
5.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
5.3 Compliance Certificate. The Company shall have delivered to the
----------------------
Investor a certificate dated as of the date of the Closing signed by the Chief
Executive Officer or President of the Company certifying that, to his knowledge,
the conditions set forth in Sections 5.1, 5.2, 5.5, 5.6, and 5.7 have been
satisfied.
5.4 Opinion of Counsel. There shall have been delivered to the
------------------
Investor an opinion of Brobeck, Phleger & Harrison LLP, counsel to the Company,
in substantially the form of Exhibit A.
5.5 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
5.6 No Material Litigation. During the period from the date of this
----------------------
Agreement to the Closing, no material litigation shall have been initiated
challenging the Company's ownership or its right to use or distribute the core
technology of the Company's products, and the Company shall have not received
any written threat of such litigation or any written claim so challenging the
Company's rights.
5.7 No Fraud or Malfeasance. During the period from the date of this
-----------------------
Agreement to the Closing, (a) none of the Company's officers or directors shall
have been removed for fraud or malfeasance in performance of his or her duties
with respect to the affairs of the Company and (b) no new legal proceedings
against any officers or directors of the Company for fraud or malfeasance in the
performance of his or her duties with respect to the affairs of the Company
shall have been instituted by the Company or its stockholders.
16
<PAGE>
6. Conditions of the Company's Obligations at Closing. The obligations of
--------------------------------------------------
the Company under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Company:
6.1 Bringdown. The Investor's representations and warranties in
---------
Section 3 shall be true in all material respects, as if made on and as of the
date of the Closing.
6.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
6.3 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
7. Miscellaneous.
-------------
7.1 Entire Agreement. This Agreement constitutes the entire contract
----------------
between the Company and the Investor relative to the subject matter hereof. Any
previous or contemporaneous agreements, understandings, promises and
representations (whether written or oral) with regard to such subject between
the Company and the Investor are superseded by this Agreement.
7.2 Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the State of California applicable to contracts
entered into and wholly to be performed within the State of California by
California residents.
7.3 Counterparts. This Agreement may be executed in counterparts,
------------
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
17
<PAGE>
7.4 Headings. The headings of the Sections and subsections of this
--------
Agreement are for convenience and shall not determine the interpretation of this
Agreement.
7.5 Notices. Any notice required or permitted hereunder shall be
-------
given in writing and shall be conclusively deemed effectively given upon
personal delivery, or, if made by registered or certified United States mail,
postage prepaid, four business days after mailing, or if made by overnight
carrier, one business day after sending, in all instances addressed (i) if to
the Company, as set forth below the Company's name on the signature page of this
Agreement, and (ii) if to the Investor, as set forth below the Investor's name
on the signature page to this Agreement, or at such other address as the Company
or the Investor may designate by ten days' advance written notice to the
Investor or the Company, respectively.
7.6 Survival of Warranties. The representations and warranties of the
----------------------
parties contained in or made pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the Closing for three years;
provided, however, that such representations and warranties need only be
accurate as of the date of such execution and delivery.
7.7 Amendment of Agreement. Any provision of this Agreement may be
----------------------
modified or amended, at any time, by a written instrument signed by the Company
and by the Investor, and not in any other way.
7.8 Fees and Expenses. The Company and the Investor will each bear
-----------------
their own fees and expenses in connection with the transactions contemplated by
this Agreement.
7.9 Finders' Fees. The Company will hold the Investor harmless from
-------------
all finders' or brokers' fees in connection with the sale of the Shares to the
Investor.
18
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
PIPES Purchase Agreement as of the day and year first above written.
P-COM, INC., a Delaware corporation
By: /s/ George P. Roberts
______________________________
Title: Chief Executive Officer
______________________________
Address: 3175 S. Winchester Boulevard
Campbell, CA 95008
Attention: Chief Financial Officer
GRUBER MCBAINE INTERNATIONAL, a
Cayman Islands corporation
By: /s/ Thomas O. Lloyd Butler
----------------------------------------
Title: Member & Manager of Gruber McBaine
----------------------------------------
Capital Manager of LLC or Investment
Advisor of Gruber McBaine International
Address: c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
19
<PAGE>
EXHIBIT A
June 22, 1999
Gruber McBaine International
c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of shares of its
common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you. This opinion letter is being rendered to you pursuant to
Section 5.4 of the Stock Purchase Agreement in connection with the Closing of
the sale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In connection with the opinions expressed herein, we have made such
examination of matters of law and of fact as we considered appropriate or
advisable for purposes hereof. As to matters of fact material to the opinions
expressed herein, we have relied upon the representations and warranties as to
factual matters contained in and made by the Company pursuant to the Stock
Purchase Agreement and upon certificates and statements of government officials
and of officers of the Company. We have also examined originals or copies of
such corporate documents or records of the Company as we have considered
appropriate for the opinions expressed herein. We have assumed for the purposes
of this opinion letter the genuineness of all signatures, the legal capacity of
natural persons, the authenticity of the documents submitted to us as originals,
the conformity to the original documents of all documents submitted to us as
certified, facsimile or photostatic copies, and the authenticity of the
originals of such copies.
In rendering this opinion letter we have also assumed: (A) that the Stock
Purchase Agreement has been duly and validly executed and delivered by you or on
your behalf, that you have the power to enter into and perform all your
obligations thereunder, and that the Stock Purchase Agreement constitutes a
valid, legal, binding and enforceable obligation upon you; (B) that the
representations and warranties made in the Stock Purchase Agreement by you are
true and correct; and (C) that any wire transfers, drafts or checks tendered by
you will be honored.
As used in this opinion letter, the expression "we are not aware" or the
phrase "to our knowledge", or any similar expression or phrase with respect to
our knowledge of matters of fact, means as to matters of fact that, based on the
actual knowledge of individual attorneys within the firm principally responsible
for handling current matters for the Company (and not including any constructive
or imputed notice of any information), and after an examination of
<PAGE>
documents referred to herein and after inquiries of certain officers of the
Company, no facts have been disclosed to us that have caused us to conclude that
the opinions expressed are factually incorrect; but beyond that we have made no
factual investigation for the purposes of rendering this opinion letter.
Specifically, but without limitation, we have not searched the dockets of any
courts and we have made no inquiries of securities holders or employees of the
Company, other than such officers.
This opinion letter relates solely to the laws of the State of California,
the General Corporation Law of the State of Delaware and the federal law of the
United States and we express no opinion with respect to the effect or
application of any other laws. Special rulings of authorities administering such
laws or opinions of other counsel have not been sought or obtained.
Based upon our examination of and reliance upon the foregoing and subject
to the limitations, exceptions, qualifications and assumptions set forth below
and except as set forth in the Stock Purchase Agreement or the Disclosure
Schedule thereto, we are of the opinion that as of the date hereof:
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, and the Company has
the requisite corporate power and authority to own its properties and to conduct
its business as, to our knowledge, it is presently conducted. The Company is
qualified to do business as a foreign corporation in the state of California.
2. The Company has the requisite corporate power and authority to
execute, deliver and perform the Stock Purchase Agreement. The Stock Purchase
Agreement has been duly and validly authorized by the Company, duly executed and
delivered by an authorized officer of the Company and constitutes a legal, valid
and binding obligation of the Company, enforceable by you against the Company in
accordance with its terms.
3. The Shares have been duly authorized and, upon purchase at the Closing
pursuant to the terms of the Stock Purchase Agreement, will be validly issued,
nonassessable and fully paid, and free of any liens created by the Company.
4. The Company's execution and delivery of, and its performance and
compliance as of the date hereof with the terms of, the Stock Purchase Agreement
do not violate any provision of any federal, Delaware corporate or California
law, rule or regulation applicable to the Company or any provision of the
Company's Restated Certificate of Incorporation or Bylaws and do not conflict
with or constitute a default under the provisions of any judgment, writ, decree
or order specifically identified in the SEC Reports or the material provisions
of any of the material agreements specifically identified in the SEC Reports.
5. Other than in connection with any securities laws, all consents,
approvals, permits, orders or authorizations of, and all qualifications by and
registrations with, any federal or Delaware corporate or California state
governmental authority on the part of the Company required in connection with
the execution and delivery of the Stock Purchase Agreement and
A-2
<PAGE>
consummation at the Closing of the transactions contemplated by the Stock
Purchase Agreement have been obtained, and are effective, and we are not aware
of any proceedings, or written threat of any proceedings, that question the
validity thereof.
6. Based in part upon the representations of you in the Stock Purchase
Agreement, the offer and sale of the Shares to you pursuant to the terms of the
Stock Purchase Agreement are exempt from the registration requirements of
Section 5 of the Securities Act of 1933, as amended, and from the qualification
requirements of the California Corporate Securities Law of 1968, as amended.
Our opinions expressed above are specifically subject to the following
limitations, exceptions, qualifications and assumptions:
(A) The legality, validity, binding nature and enforceability of the
Company's obligations under the Stock Purchase Agreement may be subject to or
limited by (1) bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent transfer and other similar laws affecting the rights of creditors
generally; (2) general principles of equity (whether relief is sought in a
proceeding at law or in equity), including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the discretion of
any court of competent jurisdiction in awarding specific performance or
injunctive relief and other equitable remedies; and (3), without limiting the
generality of the foregoing, the effect of California court decisions and
statutes which indicate that provisions of the Stock Purchase Agreement which
permit you to take action or make determinations may be subject to a requirement
that such action be taken or such determinations be made on a reasonable basis
in good faith or that it be shown that such action is reasonably necessary for
your protection.
(B) We express no opinion as to the Company's compliance or noncompliance
with applicable federal or state antifraud or antitrust statutes, laws, rules
and regulations.
(C) We express no opinion concerning the past, present or future fair
market value of any securities.
(D) We express no opinion as to the enforceability under certain
circumstances of any provisions indemnifying a party against, or requiring
contributions toward, that party's liability for its own wrongful or negligent
acts, or where indemnification or contribution is contrary to public policy or
prohibited by law. In this regard, we advise you that in the opinion of the
Securities and Exchange Commission, indemnification of directors, officers and
controlling persons of an issuer against liabilities arising under the
Securities Act of 1933, as amended, is against public policy and is therefore
unenforceable.
(E) We express no opinion as to the enforceability under certain
circumstances of any provisions prohibiting waivers of any terms of the Stock
Purchase Agreement other than in writing, or prohibiting oral modifications
thereof or modification by course of dealing. In addition, our opinions are
subject to the effect of judicial decisions which may permit the introduction of
extrinsic evidence to interpret the terms of written contracts.
A-3
<PAGE>
(F) We express no opinion as to the effect of Section 1670.5 of the
California Civil Code or any other California law, federal law or equitable
principle which provides that a court may refuse to enforce, or may limit the
application of, a contract or any clause thereof which the court finds to have
been unconscionable at the time it was made or contrary to public policy.
(G) We express no opinion as to your compliance with any Federal or state
law relating to your legal or regulatory status.
(H) We express no opinion as to the compliance of the Company, the
Investor or the sale of the Common Stock to the Investor with the provisions of
the Small Business Investment Act of 1958, as amended, or any of the regulations
promulgated thereunder.
(I) We express no opinion as to the effect of subsequent issuances of
securities of the Company, to the extent that further issuances which may be
integrated with the Closing may include purchasers that do not meet the
definition of "accredited investors" under Rule 501 of Regulation D and
equivalent definitions under state securities or "blue sky" laws.
(J) We express no opinion as to Section 7.2 of the Stock Purchase
Agreement to the extent that it purports to exclude conflict of law principles
under California law.
(K) With your permission, we express no opinion regarding the Hart-Scott-
Rodino Antitrust Improvements Act of 1976.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and may not be
delivered to, quoted or relied upon by any person other than you, or for any
other purpose, without our prior written consent. Our opinion is expressly
limited to the matters set forth above and we render no opinion, whether by
implication or otherwise, as to any other matters relating to the Company or the
Shares. We assume no obligation to advise you of facts, circumstances, events or
developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
A-4
<PAGE>
EXHIBIT B
_____________, 1999
Gruber McBaine International
c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of certain Shares of
its common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you and in connection with the Company's registration with the
SEC of such Shares for resale by you. This opinion letter is being rendered to
you pursuant to Section 4.2(b) of the Stock Purchase Agreement in connection
with the SEC declaring effective the Registration Statement for your resale of
the Shares. Capitalized terms not otherwise defined in this opinion letter have
the meanings given them in the Stock Purchase Agreement.
In our capacity as counsel to the Company, we have examined, among other
things, originals, or copies identified to our satisfaction as being true
copies, of the Registration Statement on Form S-1 (File No. 333-____________)
initially filed by the Company with the SEC on ____________, 1999, for the
purpose of registering the resale of the Shares under the Securities Act;
Amendment No. 1 to such Registration Statement filed with the SEC on
_____________, 1999; Amendment No. 2 to such Registration Statement filed with
the SEC on _____________, 1999; and oral advice on ______________, 1999, from an
SEC staff examiner, that the SEC had declared such Registration Statement, as so
amended, effective as of ______ p.m., Washington, D.C. time, on _____________,
1999.
As used in this opinion letter, the phrase "to our knowledge" means as to
matters of fact that, based on the actual knowledge of individual attorneys
within the firm principally responsible for handling current matters for the
Company (and not including any constructive or imputed notice of any
information), no facts have been disclosed to us that have caused us to conclude
that the opinions expressed are factually incorrect; but our affirmative factual
investigation for the purpose of rendering this opinion letter has been limited
to obtaining (a) oral advice received on ___________, from an SEC staff
examiner, that the SEC had declared such Registration Statement, as amended,
effective at _____ p.m. Washington, D.C. time, on _________ , 1999 and (b) oral
advice received on ___________, 1999 from an SEC staff examiner that there is no
stop order suspending the effectiveness of the Registration Statement.
Based upon our examination of and reliance upon the foregoing, we are of
the opinion that as of the date hereof:
<PAGE>
1. The Registration Statement has become effective under the Securities
Act and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose are
pending before or contemplated by the SEC.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and the
Registration Statement and may not be delivered to, quoted or relied upon by any
person other than you, or for any other purpose, without our prior written
consent. Our opinion is expressly limited to the matters set forth above and we
render no opinion, whether by implication or otherwise, as to any other matters
relating to the Company, the Stock Purchase Agreement, the Registration
Statement or the Shares. We assume no obligation to advise you of facts,
circumstances, events or developments which hereafter may be brought to our
attention and which may alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
B-2
<PAGE>
EXHIBIT 10.50
COMMON STOCK PIPES PURCHASE AGREEMENT
THIS COMMON STOCK PIPES PURCHASE AGREEMENT (the "Agreement") is made as of
June 21, 1999, by and between P-Com, Inc., a Delaware corporation (the
"Company"), and Lockheed Martin Corp. Master Retirement Trust , a New York
retirement trust (the "Investor").
RECITALS:
--------
A. The Company desires to sell shares of the Company's Common Stock,
$.0001 par value ("Common Stock") to the Investor, and the Investor desires to
purchase shares of Common Stock, on the terms and subject to the conditions set
forth in this Agreement.
THE PARTIES AGREE AS FOLLOWS:
1. Purchase and Sale of Common Stock.
---------------------------------
1.1 Sale and Issuance of Common Stock. The Company shall sell to the
---------------------------------
Investor and the Investor shall purchase from the Company, on the date of the
Closing (as defined in Section 1.2 below), at a price per share equal to the
Formula Price (as defined in Section 1.3 below), that number of shares of Common
Stock equal to the quotient of $250,000 divided by the Formula Price (the
"Shares").
1.2 Closing. The purchase and sale of the Shares shall take place at
-------
11:00 a.m. Pacific Daylight Time on June 22, 1999, at the offices of Brobeck,
Phleger & Harrison LLP, 550 West "C" Street, San Diego, California 92101, or on
such date and at such time and place as the Company and the Investor shall
mutually agree (the "Closing"). At the Closing the Company shall deliver to the
Investor a stock certificate (in the name of "Pitt & Co / 169629-99")
representing the Shares against delivery to the Company by the Investor of
$250,000 by wire transfer to the Company.
<PAGE>
1.3 Formula Price. The "Formula Price" means the product of 92.5%
-------------
times the mean average of the 15 closing sale prices of the Common Stock, as
reported by the Nasdaq National Market, for the 15 consecutive trading days
ending on and including June 17, 1999; i.e., the Formula Price is $3.973.
2. Representations and Warranties of the Company. For purposes of this
---------------------------------------------
Section 2, unless the context otherwise requires, the term "Company" shall
include the Company and its subsidiaries as listed in its most recent Annual
Report on Form 10-K/A for the year ended December 31, 1998 (the "Annual Report")
filed with the Securities and Exchange Commission (the "SEC"). Except as set
forth in the Disclosure Schedule delivered to the Investor supplementally (the
"Disclosure Schedule"), the Company hereby represents and warrants to the
Investor as follows:
2.1 Corporate Organization and Authority of the Company. The Company
---------------------------------------------------
and each of its subsidiaries:
(a) is a corporation duly organized, validly existing, authorized
to exercise all its corporate powers, rights and privileges and in good standing
in the state or jurisdiction of its incorporation;
(b) has the corporate power and authority to own and operate its
properties and to carry on its business as presently conducted and as proposed
to be conducted; and
(c) is qualified to do business as a foreign corporation in each
jurisdiction in which the ownership of its property or the nature of its
business requires such qualification, except where failure to so qualify would
not have a materially adverse effect on the business, properties or financial
condition of the Company and its subsidiaries, taken as a whole.
2
<PAGE>
The Company has furnished to the Investor true and correct copies of its
Certificate of Incorporation and Bylaws, each as amended to date.
2.2 Capitalization. The authorized capital stock of the Company
--------------
consists of:
(a) Preferred Stock. 2,000,000 shares of Preferred Stock, $.0001
---------------
par value, 750,000 shares of which have been designated Series A Junior
Participating Preferred Stock, of which none were issued and outstanding as of
June 21, 1999.
(b) Common Stock. 95,000,000 shares of Common Stock, $.0001 par
------------
value, of which 54,101,545 shares were issued and outstanding as of June 21,
1999.
(c) All outstanding shares of the Company's Common Stock have
been duly authorized and validly issued (including, without limitation, issued
in compliance with applicable federal and state securities laws), and are fully
paid and nonassessable.
(d) Since June 21, 1999, the Company has not issued any shares
of Common Stock or Preferred Stock except in connection with the exercise of
outstanding options or warrants. Except as described in the Disclosure Schedule,
there are no options, warrants, conversion privileges or other contractual
rights presently outstanding to purchase or otherwise acquire from the Company
any shares of the Company's capital stock or other securities (whether or not
authorized).
2.3 Subsidiaries. The company does not presently own, have any
------------
investment in, or control, directly or indirectly, any subsidiaries,
associations or other business entities, except as disclosed in the Annual
Report. The Company is not a participant in any joint venture or partnership,
except as disclosed in the Annual Report.
2.4 Authorization. All corporate action on the part of the Company,
-------------
its officers, directors and stockholders necessary for the authorization,
execution, delivery and
3
<PAGE>
performance by the Company of all its obligations under this Agreement and for
the authorization, issuance, sale and delivery of the Shares has been taken, and
this Agreement, once executed by the Company and the Investor, will constitute a
legally binding and valid obligation of the Company enforceable in accordance
with its terms, such enforceability being subject only to laws of general
application relating to bankruptcy, insolvency and the relief of debtors and
rules of law governing specific performance, injunctive relief or other
equitable remedies. Except for rights, if any, which have been duly waived, the
issuance and sale of the Shares will not give rise to any preemptive rights or
rights of first refusal on behalf of any person in existence on the date hereof.
2.5 Validity of Shares. The Shares, when issued, sold and delivered
------------------
in accordance with the terms and for the consideration expressed in this
Agreement, shall be duly and validly issued (including, without limitation,
compliance with applicable federal and state securities laws), fully paid and
nonassessable.
2.6 No Conflict. The execution and delivery of this Agreement do not,
-----------
and the consummation of the transactions contemplated hereby will not, conflict
with, or result in any violation of, or default (with or without notice or lapse
in time, or both) under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to a loss of a material benefit under, any
provision of the Certificate of Incorporation or Bylaws of the Company. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated hereby will not, conflict with, or result in any
violation of, or default (with or without notice or lapse in time, or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation or to a loss of a material benefit under, any provision of any
mortgage, indenture, lease or other agreement or instrument, permit, concession,
franchise,
4
<PAGE>
license, judgment, order, decree, statute, law, ordinance, rule or regulation
applicable to the Company, its properties or assets, the effect of which could
have a material adverse effect on the Company or materially impair or restrict
its power to perform its obligations as contemplated hereby.
2.7 Accuracy of Reports. The Annual Report, the Company's quarterly
-------------------
report on Form 10-Q for the quarter ended March 31, 1999 filed with the SEC (the
"Quarterly Report"), and all reports required to be filed by the Company
thereafter to the date of this Agreement under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), copies of which have been furnished to
the Investor (together, the "SEC Reports"), have been duly filed, were (as
amended to date) complete and correct in all material respects as of the dates
at which the information was furnished, and (as amended to date) contained (as
of such dates) no untrue statement of a material fact nor omitted to state a
material fact necessary in order to make the statements made therein, in light
of the circumstances in which they were made, not misleading.
2.8 Changes. Except as otherwise disclosed herein, in the Disclosure
-------
Schedule or in the SEC Reports, between March 31, 1999 and the date of this
Agreement there has not been:
(a) any change in the assets, liabilities, financial condition,
prospects or operations of the Company from that reflected in the Quarterly
Report, except changes in the ordinary course of business which have not been,
either in any individual case or in the aggregate, materially adverse;
(b) any material change in the contingent obligations of the
Company, whether by way of guaranty, endorsement, indemnity, warranty or
otherwise;
5
<PAGE>
(c) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties or business of
the Company;
(d) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(e) any labor organization activity; or
(f) to the best of the Company's knowledge, any other event or
condition of any character which has materially and adversely affected the
Company's assets, liabilities, financial condition, prospects or
operations.
2.9 Government Consent, etc. No consent, approval or authorization
------------------
of or designation, declaration or filing with any governmental authority on the
part of the Company is required in connection with the valid execution and
delivery of this Agreement, or the offer, sale or issuance of the Shares, or
the consummation of any other transaction contemplated hereby, except the
filing of a Registration Statement and related activities pursuant to Section 4
hereof.
2.10 Full Disclosure. The representations and warranties of the
---------------
Company contained in this Agreement, when read together with the Disclosure
Schedule and the SEC Reports, do not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements contained herein, in light of the circumstances under which they were
made, not misleading.
2.11 Conflicts Prohibited. The Company represents, warrants and
--------------------
covenants that to the best of its knowledge no officer or employee of Investor
has a direct or indirect economic interest in the Company or its property or
contracts other than as disclosed in the SEC Reports, nor will any officer or
employee of Investor receive, directly or indirectly, anything of
6
<PAGE>
substantial economic value for his or her private benefit from the Company or
anyone acting on its behalf in connection with the investment made pursuant to
this Agreement.
2.12 Intellectual Property. The Company has not violated and is not
---------------------
currently in violation of any copyright, trademark or other intellectual
property rights of any third persons, except to the extent that such violation
does not materially and adversely affect the Company or its operations.
2.13 Litigation/Bankruptcy/Malfeasance. The Company is not the subject
---------------------------------
of and has not received notice of any legal proceedings of the following types
to which the Company is a party (or, if applicable, any executive officer or
director of the Company) or any of its property is the subject: any proceeding
that involves a claim against the Company for damages in excess of $500,000; any
material bankruptcy, receivership or similar proceedings with respect to the
Company; or any criminal proceedings or civil proceedings for fraud or
malfeasance of which a director or executive officer of the Company is the
subject (excluding minor offenses).
3. Representations and Warranties of the Investor. The Investor
----------------------------------------------
represents and warrants to the Company as follows:
3.1 Organization. It is a retirement trust validly existing
------------
under the laws of the State of New York, with all requisite power and authority
to conduct its business as now being conducted.
3.2 Authority. It has all retirement trust right, power and
---------
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Investor and the consummation by it of the transactions
7
<PAGE>
contemplated hereby have been duly authorized by all necessary retirement trust
action on behalf of the Investor. This Agreement has been duly executed and
delivered by and constitutes a legal, valid and binding obligation of the
Investor, enforceable in accordance with its terms, subject to laws of general
application relating to bankruptcy, insolvency and the relief of debtors and
rules of law governing specific performance, injunctive relief or other
equitable remedies. The execution and delivery of this Agreement do not, and the
consummation of the transactions contemplated hereby will not, conflict with or
result in any violation of any obligation under any provision of the
authorization statute or organizational or other charter documents of the
Investor or any judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to the Investor.
3.3 Information. The Investor represents that it has received all the
-----------
information it has requested from the Company and considers necessary or
appropriate for deciding whether to purchase the Shares. The delivery of any
information by the Company to the Investor shall not abrogate the
representations and warranties of the Company contained herein.
3.4 No Current Resale. The Investor is acquiring the Shares for its
-----------------
own account and not with a view to sale or distribution. Any such sale or
distribution shall be made only in compliance with the provisions of the
Securities Act of 1933, as amended (the "Securities Act") and all applicable
blue sky laws. The Investor acknowledges that the Shares are not now registered
under the Securities Act or any blue sky law, and might never be so registered.
The Investor further acknowledges that the stock certificate representing the
Shares will bear a customary securities-law restrictive legend.
8
<PAGE>
3.5 Status of Investor (Regulation D and HSR). The Investor is an
-----------------------------------------
"accredited investor" as such term is defined in Rule 501 as promulgated by the
SEC under the Securities Act.
4. Covenants.
---------
4.1 Registration of Shares.
----------------------
(a) The Company shall, before the later of (i) 20 days after the
SEC declares effective the Company's Form S-3 registration statement for the
resale of the Common Stock issued by the Company in exchange for its Series B
Convertible Participating Preferred Stock, and (ii) 45 days following the
Closing, prepare and file with the SEC a registration statement on Form S-1
under the Securities Act covering the resale of the Shares by the Investor
(subject to Section 4.1(g), the "Registration Statement"), and corresponding
applications for registration under the blue sky laws of any states for which
the Investor reasonably requests in writing to the Company that the Company
obtain such blue-sky registration (it being understood that in the vast majority
of states no such registration is legally required, due to the Company's Nasdaq
National Market listing or other reasons). The Company shall use its reasonable
diligent efforts to obtain effectiveness of the Registration Statement and such
blue sky registrations as soon thereafter as practicable, and in any event
within 90 days after the initial filing of the Registration Statement with the
SEC, and shall use its best efforts to keep the Registration Statement and such
blue sky registrations effective after that. Notwithstanding the foregoing, the
Company will only be required to maintain the effectiveness of the Registration
Statement and such blue sky registrations until the earlier of (a) such time as
all of the Shares have been disposed of by the Investor, or (b) such date on
which the Investor may legally dispose of all of the Shares held by it in one
transaction in the open market pursuant to Rule 144(k) under the Securities Act.
The Company shall also cause the Shares to be listed on the Nasdaq National
9
<PAGE>
Market and on any stock exchange on which the Common Stock may from time to
time be listed. The Company shall pay all fees and expenses incurred by the
Company in connection with preparing, filing, prosecuting and updating the
Registration Statement, such blue sky applications and registrations, and such
listing, including all registration and filing fees, listing fees, printing
expenses, and fees and disbursements of the Company's counsel and accountants.
(b) The Investor shall cooperate fully with the Company in the
preparation of such Registration Statement and blue sky applications and shall
provide to the Company all information and materials (including updated
information and materials) regarding itself and its proposed method of
disposition of the Shares and take all actions reasonably requested by the
Company to permit the Company to comply with applicable requirements of the SEC,
to comply with applicable requirements of the relevant blue sky laws, and to
obtain the desired acceleration of the effective date of such Registration
Statement.
(c) Subject to Section 4.1(d) hereof, the Company shall promptly
prepare and file with the SEC and any relevant blue sky authorities such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith as may be necessary to keep such Registration Statement
effective and to comply with (and enable the Investor to comply with) the
provisions of the Securities Act and Rule 415 thereunder with respect to the
disposition of all the Shares.
(d) During the effectiveness of the Registration Statement, the
Company shall promptly notify the Investor of the happening of any event or
other circumstance as the result of which, in the Company's judgment, (i) the
prospectus included in the Registration Statement, as then in effect, would
include an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not
10
<PAGE>
misleading in light of the circumstances then existing, or (ii) the offer or
resale of the Shares would otherwise have a material and adverse effect on any
proposed or pending acquisition, merger, business combination or other material
transaction involving the Company; and, upon receipt of such notice and until
the earlier of (i) the date the Company makes available to the Investor a
supplemented or amended prospectus meeting the requirements of the Securities
Act and relevant blue sky laws, or (ii) the date the Company notifies the
Investor that the Investor may resume offers and sales using the prior
prospectus, the Investor shall not offer or sell any Shares pursuant to the
Registration Statement (and shall return all copies of such prior prospectus to
the Company if requested to do so by it). Notwithstanding Section 4.1(c), the
Company may continue such "blackout" period or periods for such period of time
as the Company considers reasonably necessary and in its best interest due to
circumstances then existing, or simply due to the fact that
amendments/supplements of a Registration Statement/ prospectus cannot be
prepared instantly; but in no event may the Company impose "blackouts" on the
---
Investor for any period of ten or more consecutive business days or totaling
more than 20 days in any 12 month period (plus any "Permitted Blackouts" as
defined in the Registration Rights Agreement dated as of December 21, 1998
between the Company, Castle Creek Technology Partners LLC and others).
(e) The Company shall not be required to apply for or obtain blue sky
registration in any state if in connection therewith or as a condition thereto
it must (i) qualify to do business in such state where it would not otherwise be
required to qualify, (ii) subject itself to general taxation in such state,
(iii) file a general consent to service of process in such state, or (iv) make
any change in its Certificate of Incorporation or Bylaws, which the Company's
Board of Directors determines to be contrary to the best interests of the
Company and its stockholders.
11
<PAGE>
(f) Indemnification.
---------------
(i) The Company will indemnify the Investor, and each of the
officers and directors of, and each person controlling, the Investor, against
all claims, losses, expenses, damages and liabilities (or actions in respect
thereto) arising out of or based on (A) any untrue statements (or alleged untrue
statement) of a material fact contained in any prospectus contained in any
registration statement covering the Shares for resale, or based on any omission
(or alleged omission) to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, or (B) any
misrepresentation or breach of any representation or warranty given or made by
the Company in this Agreement, and will reimburse the Investor, each of its
officers and directors and each person controlling the Investor, for any
reasonable legal and any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability or
action, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage or liability is caused by any untrue
statement or omission based upon written information furnished to the Company by
the Investor specifically for use therein.
(ii) The Investor will indemnify the Company, each of its
directors and officers, and each person who controls the Company within the
meaning of the Securities Act, against all claims, losses, expenses, damages and
liabilities (or actions in respect thereof) arising out of or based on (A) any
untrue statement (or alleged untrue statement) of a material fact contained in
any such prospectus, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (B) any sale of Shares which violates (or allegedly
violates) the Securities Act because of violation of the prospectus delivery
requirement or because more or less than the
12
<PAGE>
information in such prospectus is given (or alleged to be given) in connection
with the sale, or (C) any misrepresentation or breach of any representation or
warranty given or made by the Investor in this Agreement, and will reimburse the
Company, and such directors, officers, or controlling persons, for any
reasonable legal or any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability or
action, but in the case of subsection (f)(ii)(A) to the extent, and only to the
extent, that such untrue statement (or alleged untrue statement) or omission (or
alleged omission) is made in such prospectus in reliance upon and in conformity
with written information furnished to the Company by the Investor specifically
for use therein.
(iii) Each party entitled to indemnification under
this Section 4.1(f) (the "Indemnified Party") shall give notice to the party
required to provide indemnification (the "Indemnifying Party") promptly after
such indemnified party has actual knowledge of any claim as to which indemnity
may be sought, and shall permit the Indemnifying Party to assume the defense of
any such claim or any litigation resulting therefrom, provided that counsel for
the Indemnifying Party, who shall conduct the defense of such claim or
litigation, shall be approved by the Indemnified Party (whose approval shall not
be unreasonably withheld), and the Indemnified Party may participate in such
defense at the Indemnified Party's expense, and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations hereunder, unless such failure
resulted in actual detriment to the Indemnifying Party. The Indemnified Party
shall provide all cooperation reasonably requested for the defense of the claim
or litigation. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
13
<PAGE>
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation. An Indemnified Party shall not decline any settlement complying with
the foregoing if it requires nothing of the Indemnified Party other than the
payment of money (which is in fact paid by the Indemnifying Party) and does not
include an admission of liability.
(iv) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which any person or
entity entitled to indemnification under Section 4.1(f) makes a claim for
indemnification pursuant to this Section 4.1(f) but it is judicially determined
(by entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 4.1(f) provides for indemnification in such case; then, and in
such case, the party that would otherwise be required to indemnify under Section
4.1(f) will contribute to the aggregate losses, claims, damages or liabilities
to which the other parties may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the parties
in connection with the losses suffered, as well as any other relevant equitable
considerations.
(g) The parties agree that if the Company becomes eligible to
register securities for resale on Form S-3 it may choose to register the Shares
for resale on Form S-3 and, after the SEC declares such Form S-3 registration
statement effective, so notify the Investor, provide all relevant deliverables
(such as a supply of new prospectuses), and then deregister the Shares from the
original Form S-1 Registration Statement. Thereafter such Form S-3
14
<PAGE>
Registration Statement shall, for all purposes of this Agreement, be deemed to
be the "Registration Statement."
4.2 Deliverables Upon Effectiveness. When and if the SEC declares the
-------------------------------
Registration Statement effective, the Company shall promptly deliver to the
Investor:
(a) A certificate signed by the President of the Company and
that the Registration Statement is effective and, to his knowledge, no stop
order with respect to the Registration Statement has been issued and no
proceedings therefor have been instituted.
(b) A legal opinion of Brobeck, Phleger & Harrison LLP, counsel
to the Company, in substantially the form of Exhibit B.
(c) Such number of copies of the Registration Statement and
(from time to time) of each amendment and supplement thereto, such number of
copies of the prospectus (including (from time to time) any supplemental or
amended prospectus) included in such Registration Statement, and such other
related documents as the Investor may reasonably request in writing in order to
facilitate the disposition of the Shares by the Investor.
4.3 Current Public Information. As long as the Investor owns any
--------------------------
Shares, the Company shall use its best efforts to properly file all SEC Reports,
or otherwise make available "adequate current public information" about itself,
within the meaning of Rule 144(c) under the Securities Act, to potentially make
available to the Investor the benefits of certain rules and regulations of the
SEC which may permit the sale of the Shares without registration.
5. Conditions of the Investor's Obligations at Closing. The obligations
---------------------------------------------------
of the Investor under Section 1 of this Agreement are subject to the fulfillment
at or before the Closing of each of the following conditions, any of which may
be waived in writing by the Investor:
15
<PAGE>
5.1 Bringdown. The Company's representations and warranties in
---------
Section 2 shall be true in all material respects, as if made on and as of the
date of the Closing. The Company shall have performed or fulfilled in all
material respects all agreements, obligations and conditions contained herein
required to be performed or fulfilled by the Company before such Closing.
5.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
5.3 Compliance Certificate. The Company shall have delivered to the
----------------------
Investor a certificate dated as of the date of the Closing signed by the Chief
Executive Officer or President of the Company certifying that, to his knowledge,
the conditions set forth in Sections 5.1, 5.2, 5.5, 5.6, and 5.7 have been
satisfied.
5.4 Opinion of Counsel. There shall have been delivered to the
------------------
Investor an opinion of Brobeck, Phleger & Harrison LLP, counsel to the Company,
in substantially the form of Exhibit A.
5.5 No Order Pending. shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement .
5.6 No Material Litigation. During the period from the date of this
----------------------
Agreement to the Closing, no material litigation shall have been initiated
challenging the Company's ownership or its right to use or distribute the core
technology of the Company's products, and the Company shall have not received
any written threat of such litigation or any written claim so challenging the
Company's rights.
16
<PAGE>
5.7 No Fraud or Malfeasance. During the period from the date of
-----------------------
this Agreement to the Closing, (a) none of the Company's officers or directors
shall have been removed for fraud or malfeasance in performance of his or her
duties with respect to the affairs of the Company and (b) no new legal
proceedings against any officers or directors of the Company for fraud or
malfeasance in the performance of his or her duties with respect to the affairs
of the Company shall have been instituted by the Company or its stockholders.
6. Conditions of the Company's Obligations at Closing. The obligations of
--------------------------------------------------
the Company under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Company:
6.1 Bringdown. The Investor's representations and warranties in
---------
Section 3 shall be true in all material respects, as if made on and as of the
date of the Closing.
6.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
6.3 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
7. Miscellaneous.
-------------
7.1 Entire Agreement. This Agreement constitutes the entire
---------------
contract between the Company and the Investor relative to the subject matter
hereof. Any previous or contemporaneous agreements, understandings, promises and
representations (whether written or oral) with regard to such subject between
the Company and the Investor are superseded by this Agreement.
17
<PAGE>
7.2 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of California applicable to
contracts entered into and wholly to be performed within the State of California
by California residents.
7.3 Counterparts. This Agreement may be executed in counterparts,
------------
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
7.4 Headings. The headings of the Sections and subsections of
--------
this Agreement are for convenience and shall not determine the interpretation of
this Agreement.
7.5 Notices. Any notice required or permitted hereunder shall be
-------
given in writing and shall be conclusively deemed effectively given upon
personal delivery, or, if made by registered or certified United States mail,
postage prepaid, four business days after mailing, or if made by overnight
carrier, one business day after sending, in all instances addressed (i) if to
the Company, as set forth below the Company's name on the signature page of this
Agreement, and (ii) if to the Investor, as set forth below the Investor's name
on the signature page to this Agreement, or at such other address as the Company
or the Investor may designate by ten days' advance written notice to the
Investor or the Company, respectively.
7.6 Survival of Warranties. The representations and warranties of
----------------------
the parties contained in or made pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the Closing for three years;
provided, however, that such representations and warranties need only be
accurate as of the date of such execution and delivery.
7.7 Amendment of Agreement. Any provision of this Agreement may be
----------------------
modified or amended, at any time, by a written instrument signed by the Company
and by the Investor, and not in any other way.
18
<PAGE>
7.8 Fees and Expenses. The Company and the Investor will each bear
-----------------
their own fees and expenses in connection with the transactions contemplated by
this Agreement.
7.9 Finders' Fees. The Company will hold the Investor harmless from
-------------
all finders' or brokers' fees in connection with the sale of the Shares to the
Investor.
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
PIPES Purchase Agreement as of the day and year first above written.
P-COM, INC., a Delaware corporation
By: /s/ George P. Roberts
_______________________________________
Title: Chief Executive Officer
_______________________________________
Address: 3175 S. Winchester Boulevard
Campbell, CA 95008
Attention: Chief Financial Officer
LOCKHEED MARTIN CORP. MASTER
RETIREMENT TRUST
By: /s/ Thomas O. Lloyd Butler
---------------------------------------
Title: Member Manager of Grebes McBaine
---------------------------------------
Capital Management CCC as investment
advisor or Lockheed Martin Corp.
Master Retirement Trust.
Address: c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
19
<PAGE>
EXHIBIT A
June 22, 1999
Lockheed Martin Corp. Master Retirement Trust
c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of shares of its
common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you. This opinion letter is being rendered to you pursuant to
Section 5.4 of the Stock Purchase Agreement in connection with the Closing of
the sale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In connection with the opinions expressed herein, we have made such
examination of matters of law and of fact as we considered appropriate or
advisable for purposes hereof. As to matters of fact material to the opinions
expressed herein, we have relied upon the representations and warranties as to
factual matters contained in and made by the Company pursuant to the Stock
Purchase Agreement and upon certificates and statements of government officials
and of officers of the Company. We have also examined originals or copies of
such corporate documents or records of the Company as we have considered
appropriate for the opinions expressed herein. We have assumed for the purposes
of this opinion letter the genuineness of all signatures, the legal capacity of
natural persons, the authenticity of the documents submitted to us as originals,
the conformity to the original documents of all documents submitted to us as
certified, facsimile or photostatic copies, and the authenticity of the
originals of such copies.
In rendering this opinion letter we have also assumed: (A) that the Stock
Purchase Agreement has been duly and validly executed and delivered by you or on
your behalf, that you have the power to enter into and perform all your
obligations thereunder, and that the Stock Purchase Agreement constitutes a
valid, legal, binding and enforceable obligation upon you; (B) that the
representations and warranties made in the Stock Purchase Agreement by you are
true and correct; and (C) that any wire transfers, drafts or checks tendered by
you will be honored.
As used in this opinion letter, the expression "we are not aware" or the
phrase "to our knowledge", or any similar expression or phrase with respect to
our knowledge of matters of fact, means as to matters of fact that, based on the
actual knowledge of individual attorneys within the firm principally responsible
for handling current matters for the Company (and not including any constructive
or imputed notice of any information), and after an examination of
20
<PAGE>
documents referred to herein and after inquiries of certain officers of the
Company, no facts have been disclosed to us that have caused us to conclude that
the opinions expressed are factually incorrect; but beyond that we have made no
factual investigation for the purposes of rendering this opinion letter.
Specifically, but without limitation, we have not searched the dockets of any
courts and we have made no inquiries of securities holders or employees of the
Company, other than such officers.
This opinion letter relates solely to the laws of the State of California,
the General Corporation Law of the State of Delaware and the federal law of the
United States and we express no opinion with respect to the effect or
application of any other laws. Special rulings of authorities administering
such laws or opinions of other counsel have not been sought or obtained.
Based upon our examination of and reliance upon the foregoing and subject
to the limitations, exceptions, qualifications and assumptions set forth below
and except as set forth in the Stock Purchase Agreement or the Disclosure
Schedule thereto, we are of the opinion that as of the date hereof:
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, and the Company has
the requisite corporate power and authority to own its properties and to conduct
its business as, to our knowledge, it is presently conducted. The Company is
qualified to do business as a foreign corporation in the state of California.
2. The Company has the requisite corporate power and authority to
execute, deliver and perform the Stock Purchase Agreement. The Stock Purchase
Agreement has been duly and validly authorized by the Company, duly executed and
delivered by an authorized officer of the Company and constitutes a legal, valid
and binding obligation of the Company, enforceable by you against the Company in
accordance with its terms.
3. The Shares have been duly authorized and, upon purchase at the Closing
pursuant to the terms of the Stock Purchase Agreement, will be validly issued,
nonassessable and fully paid, and free of any liens created by the Company.
4. The Company's execution and delivery of, and its performance and
compliance as of the date hereof with the terms of, the Stock Purchase Agreement
do not violate any provision of any federal, Delaware corporate or California
law, rule or regulation applicable to the Company or any provision of the
Company's Restated Certificate of Incorporation or Bylaws and do not conflict
with or constitute a default under the provisions of any judgment, writ, decree
or order specifically identified in the SEC Reports or the material provisions
of any of the material agreements specifically identified in the SEC Reports.
5. Other than in connection with any securities laws, all consents,
approvals, permits, orders or authorizations of, and all qualifications by and
registrations with, any federal or Delaware corporate or California state
governmental authority on the part of the Company required in connection with
the execution and delivery of the Stock Purchase Agreement and
A-2
<PAGE>
consummation at the Closing of the transactions contemplated by the Stock
Purchase Agreement have been obtained, and are effective, and we are not aware
of any proceedings, or written threat of any proceedings, that question the
validity thereof.
6. Based in part upon the representations of you in the Stock Purchase
Agreement, the offer and sale of the Shares to you pursuant to the terms of the
Stock Purchase Agreement are exempt from the registration requirements of
Section 5 of the Securities Act of 1933, as amended, and from the qualification
requirements of the California Corporate Securities Law of 1968, as amended.
Our opinions expressed above are specifically subject to the following
limitations, exceptions, qualifications and assumptions:
(A) The legality, validity, binding nature and enforceability of the
Company's obligations under the Stock Purchase Agreement may be subject to or
limited by (1) bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent transfer and other similar laws affecting the rights of creditors
generally; (2) general principles of equity (whether relief is sought in a
proceeding at law or in equity), including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the discretion of
any court of competent jurisdiction in awarding specific performance or
injunctive relief and other equitable remedies; and (3), without limiting the
generality of the foregoing, the effect of California court decisions and
statutes which indicate that provisions of the Stock Purchase Agreement which
permit you to take action or make determinations may be subject to a requirement
that such action be taken or such determinations be made on a reasonable basis
in good faith or that it be shown that such action is reasonably necessary for
your protection.
(B) We express no opinion as to the Company's compliance or noncompliance
with applicable federal or state antifraud or antitrust statutes, laws, rules
and regulations.
(C) We express no opinion concerning the past, present or future fair
market value of any securities.
(D) We express no opinion as to the enforceability under certain
circumstances of any provisions indemnifying a party against, or requiring
contributions toward, that party's liability for its own wrongful or negligent
acts, or where indemnification or contribution is contrary to public policy or
prohibited by law. In this regard, we advise you that in the opinion of the
Securities and Exchange Commission, indemnification of directors, officers and
controlling persons of an issuer against liabilities arising under the
Securities Act of 1933, as amended, is against public policy and is therefore
unenforceable.
(E) We express no opinion as to the enforceability under certain
circumstances of any provisions prohibiting waivers of any terms of the Stock
Purchase Agreement other than in writing, or prohibiting oral modifications
thereof or modification by course of dealing. In addition, our opinions are
subject to the effect of judicial decisions which may permit the introduction of
extrinsic evidence to interpret the terms of written contracts.
A-3
<PAGE>
(F) We express no opinion as to the effect of Section 1670.5 of the
California Civil Code or any other California law, federal law or equitable
principle which provides that a court may refuse to enforce, or may limit the
application of, a contract or any clause thereof which the court finds to have
been unconscionable at the time it was made or contrary to public policy.
(G) We express no opinion as to your compliance with any Federal or state
law relating to your legal or regulatory status.
(H) We express no opinion as to the compliance of the Company, the
Investor or the sale of the Common Stock to the Investor with the provisions of
the Small Business Investment Act of 1958, as amended, or any of the regulations
promulgated thereunder.
(I) We express no opinion as to the effect of subsequent issuances of
securities of the Company, to the extent that further issuances which may be
integrated with the Closing may include purchasers that do not meet the
definition of "accredited investors" under Rule 501 of Regulation D and
equivalent definitions under state securities or "blue sky" laws.
(J) We express no opinion as to Section 7.2 of the Stock Purchase
Agreement to the extent that it purports to exclude conflict of law principles
under California law.
(K) With your permission, we express no opinion regarding the Hart-Scott-
Rodino Antitrust Improvements Act of 1976.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and may not be
delivered to, quoted or relied upon by any person other than you, or for any
other purpose, without our prior written consent. Our opinion is expressly
limited to the matters set forth above and we render no opinion, whether by
implication or otherwise, as to any other matters relating to the Company or the
Shares. We assume no obligation to advise you of facts, circumstances, events
or developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
A-4
<PAGE>
EXHIBIT B
_____________, 1999
Lockheed Martin Corp. Master Retirement Trust
c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of certain Shares of
its common stock, par value $.0001 per share, pursuant to the Common Stock
PIPES Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement")
between the Company and you and in connection with the Company's registration
with the SEC of such Shares for resale by you. This opinion letter is being
rendered to you pursuant to Section 4.2(b) of the Stock Purchase Agreement in
connection with the SEC declaring effective the Registration Statement for your
resale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In our capacity as counsel to the Company, we have examined, among other
things, originals, or copies identified to our satisfaction as being true
copies, of the Registration Statement on Form S-1 (File No. 333-____________)
initially filed by the Company with the SEC on ____________, 1999, for the
purpose of registering the resale of the Shares under the Securities Act;
Amendment No. 1 to such Registration Statement filed with the SEC on
_____________, 1999; Amendment No. 2 to such Registration Statement filed with
the SEC on _____________, 1999; and oral advice on ______________, 1999, from an
SEC staff examiner, that the SEC had declared such Registration Statement, as so
amended, effective as of ______ p.m., Washington, D.C. time, on _____________,
1999.
As used in this opinion letter, the phrase "to our knowledge" means as to
matters of fact that, based on the actual knowledge of individual attorneys
within the firm principally responsible for handling current matters for the
Company (and not including any constructive or imputed notice of any
information), no facts have been disclosed to us that have caused us to conclude
that the opinions expressed are factually incorrect; but our affirmative factual
investigation for the purpose of rendering this opinion letter has been limited
to obtaining (a) oral advice received on ___________, from an SEC staff
examiner, that the SEC had declared such Registration Statement, as amended,
effective at _____ p.m. Washington, D.C. time, on _________ , 1999 and (b) oral
advice received on ___________, 1999 from an SEC staff examiner that there is no
stop order suspending the effectiveness of the Registration Statement.
Based upon our examination of and reliance upon the foregoing, we are of
the opinion that as of the date hereof:
<PAGE>
1. The Registration Statement has become effective under the Securities
Act and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose are
pending before or contemplated by the SEC.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and the
Registration Statement and may not be delivered to, quoted or relied upon by any
person other than you, or for any other purpose, without our prior written
consent. Our opinion is expressly limited to the matters set forth above and we
render no opinion, whether by implication or otherwise, as to any other matters
relating to the Company, the Stock Purchase Agreement, the Registration
Statement or the Shares. We assume no obligation to advise you of facts,
circumstances, events or developments which hereafter may be brought to our
attention and which may alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
B-2
<PAGE>
EXHIBIT 10.51
COMMON STOCK PIPES PURCHASE AGREEMENT
THIS COMMON STOCK PIPES PURCHASE AGREEMENT (the "Agreement") is made as of
June 21, 1999, by and between P-Com, Inc., a Delaware corporation (the
"Company"), and Trustees of Hamilton College, a New York college education fund
(the "Investor").
RECITALS:
--------
A. The Company desires to sell shares of the Company's Common Stock,
$.0001 par value ("Common Stock") to the Investor, and the Investor desires to
purchase shares of Common Stock, on the terms and subject to the conditions set
forth in this Agreement.
THE PARTIES AGREE AS FOLLOWS:
1. Purchase and Sale of Common Stock.
---------------------------------
1.1 Sale and Issuance of Common Stock. The Company shall sell to the
---------------------------------
Investor and the Investor shall purchase from the Company, on the date of the
Closing (as defined in Section 1.2 below), at a price per share equal to the
Formula Price (as defined in Section 1.3 below), that number of shares of Common
Stock equal to the quotient of $125,000 divided by the Formula Price (the
"Shares").
1.2 Closing. The purchase and sale of the Shares shall take place at
-------
11:00 a.m. Pacific Daylight Time on June 22, 1999, at the offices of Brobeck,
Phleger & Harrison LLP, 550 West "C" Street, San Diego, California 92101, or on
such date and at such time and place as the Company and the Investor shall
mutually agree (the "Closing"). At the Closing the Company shall deliver to the
Investor a stock certificate (in the name of "Hare & Co / 651653") representing
the Shares against delivery to the Company by the Investor of $125,000 by wire
transfer to the Company.
<PAGE>
1.3 Formula Price. The "Formula Price" means the product of 92.5%
-------------
times the mean average of the 15 closing sale prices of the Common Stock, as
reported by the Nasdaq National Market, for the 15 consecutive trading days
ending on and including June 17, 1999; i.e., the Formula Price is $3.973.
2. Representations and Warranties of the Company. For purposes of this
---------------------------------------------
Section 2, unless the context otherwise requires, the term "Company" shall
include the Company and its subsidiaries as listed in its most recent Annual
Report on Form 10-K/A for the year ended December 31, 1998 (the "Annual Report")
filed with the Securities and Exchange Commission (the "SEC"). Except as set
forth in the Disclosure Schedule delivered to the Investor supplementally (the
"Disclosure Schedule"), the Company hereby represents and warrants to the
Investor as follows:
2.1 Corporate Organization and Authority of the Company. The Company
---------------------------------------------------
and each of its subsidiaries:
(a) is a corporation duly organized, validly existing,
authorized to exercise all its corporate powers, rights and privileges and in
good standing in the state or jurisdiction of its incorporation;
(b) has the corporate power and authority to own and operate its
properties and to carry on its business as presently conducted and as proposed
to be conducted; and
(c) is qualified to do business as a foreign corporation in each
jurisdiction in which the ownership of its property or the nature of its
business requires such qualification, except where failure to so qualify would
not have a materially adverse effect on the business, properties or financial
condition of the Company and its subsidiaries, taken as a whole.
2
<PAGE>
The Company has furnished to the Investor true and correct copies of its
Certificate of Incorporation and Bylaws, each as amended to date.
2.2 Capitalization. The authorized capital stock of the Company
--------------
consists of:
(a) Preferred Stock. 2,000,000 shares of Preferred Stock, $.0001
---------------
par value, 750,000 shares of which have been designated Series A Junior
Participating Preferred Stock, of which none were issued and outstanding as of
June 21, 1999.
(b) Common Stock. 95,000,000 shares of Common Stock, $.0001 par
------------
value, of which 54,101,545 shares were issued and outstanding as of June 21,
1999.
(c) All outstanding shares of the Company's Common Stock have
been duly authorized and validly issued (including, without limitation, issued
in compliance with applicable federal and state securities laws), and are fully
paid and nonassessable.
(d) Since June 21, 1999, the Company has not issued any shares
of Common Stock or Preferred Stock except in connection with the exercise of
outstanding options or warrants. Except as described in the Disclosure Schedule,
there are no options, warrants, conversion privileges or other contractual
rights presently outstanding to purchase or otherwise acquire from the Company
any shares of the Company's capital stock or other securities (whether or not
authorized).
2.3 Subsidiaries. The Company does not presently own, have any
------------
investment in, or control, directly or indirectly, any subsidiaries,
associations or other business entities, except as disclosed in the Annual
Report. The Company is not a participant in any joint venture or partnership,
except as disclosed in the Annual Report.
2.4 Authorization. All corporate action on the part of the Company,
-------------
its officers, directors and stockholders necessary for the authorization,
execution, delivery and
3
<PAGE>
performance by the Company of all its obligations under this Agreement and for
the authorization, issuance, sale and delivery of the Shares has been taken, and
this Agreement, once executed by the Company and the Investor, will constitute a
legally binding and valid obligation of the Company enforceable in accordance
with its terms, such enforceability being subject only to laws of general
application relating to bankruptcy, insolvency and the relief of debtors and
rules of law governing specific performance, injunctive relief or other
equitable remedies. Except for rights, if any, which have been duly waived, the
issuance and sale of the Shares will not give rise to any preemptive rights or
rights of first refusal on behalf of any person in existence on the date hereof.
2.5 Validity of Shares. The Shares, when issued, sold and delivered
------------------
in accordance with the terms and for the consideration expressed in this
Agreement, shall be duly and validly issued (including, without limitation,
compliance with applicable federal and state securities laws), fully paid and
nonassessable.
2.6 No Conflict. The execution and delivery of this Agreement do not,
-----------
and the consummation of the transactions contemplated hereby will not, conflict
with, or result in any violation of, or default (with or without notice or lapse
in time, or both) under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to a loss of a material benefit under, any
provision of the Certificate of Incorporation or Bylaws of the Company. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated hereby will not, conflict with, or result in any
violation of, or default (with or without notice or lapse in time, or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation or to a loss of a material benefit under, any provision of any
mortgage, indenture, lease or other agreement or instrument, permit, concession,
franchise,
4
<PAGE>
license, judgment, order, decree, statute, law, ordinance, rule or regulation
applicable to the Company, its properties or assets, the effect of which could
have a material adverse effect on the Company or materially impair or restrict
its power to perform its obligations as contemplated hereby.
2.7 Accuracy of Reports. The Annual Report, the Company's quarterly
-------------------
report on Form 10-Q for the quarter ended March 31, 1999 filed with the SEC (the
"Quarterly Report"), and all reports required to be filed by the Company
thereafter to the date of this Agreement under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), copies of which have been furnished to
the Investor (together, the "SEC Reports"), have been duly filed, were (as
amended to date) complete and correct in all material respects as of the dates
at which the information was furnished, and (as amended to date) contained (as
of such dates) no untrue statement of a material fact nor omitted to state a
material fact necessary in order to make the statements made therein, in light
of the circumstances in which they were made, not misleading.
2.8 Changes. Except as otherwise disclosed herein, in the Disclosure
-------
Schedule or in the SEC Reports, between March 31, 1999 and the date of this
Agreement there has not been:
(a) any change in the assets, liabilities, financial condition,
prospects or operations of the Company from that reflected in the Quarterly
Report, except changes in the ordinary course of business which have not been,
either in any individual case or in the aggregate, materially adverse;
(b) any material change in the contingent obligations of the
Company, whether by way of guaranty, endorsement, indemnity, warranty or
otherwise;
5
<PAGE>
(c) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties or business of the
Company;
(d) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(e) any labor organization activity; or
(f) to the best of the Company's knowledge, any other event or
condition of any character which has materially and adversely affected the
Company's assets, liabilities, financial condition, prospects or operations.
2.9 Government Consent, etc. No consent, approval or authorization of
------------------------
or designation, declaration or filing with any governmental authority on the
part of the Company is required in connection with the valid execution and
delivery of this Agreement, or the offer, sale or issuance of the Shares, or the
consummation of any other transaction contemplated hereby, except the filing of
a Registration Statement and related activities pursuant to Section 4 hereof.
2.10 Full Disclosure. The representations and warranties of the
---------------
Company contained in this Agreement, when read together with the Disclosure
Schedule and the SEC Reports, do not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements contained herein, in light of the circumstances under which they were
made, not misleading.
2.11 Conflicts Prohibited. The Company represents, warrants and
--------------------
covenants that to the best of its knowledge no officer or employee of Investor
has a direct or indirect economic interest in the Company or its property or
contracts other than as disclosed in the SEC Reports, nor will any officer or
employee of Investor receive, directly or indirectly, anything of
6
<PAGE>
substantial economic value for his or her private benefit from the Company or
anyone acting on its behalf in connection with the investment made pursuant to
this Agreement.
2.12 Intellectual Property. The Company has not violated and is not
---------------------
currently in violation of any copyright, trademark or other intellectual
property rights of any third persons, except to the extent that such violation
does not materially and adversely affect the Company or its operations.
2.13 Litigation/Bankruptcy/Malfeasance. The Company is not the
---------------------------------
subject of and has not received notice of any legal proceedings of the following
types to which the Company is a party (or, if applicable, any executive officer
or director of the Company) or any of its property is the subject: any
proceeding that involves a claim against the Company for damages in excess of
$500,000; any material bankruptcy, receivership or similar proceedings with
respect to the Company; or any criminal proceedings or civil proceedings for
fraud or malfeasance of which a director or executive officer of the Company is
the subject (excluding minor offenses).
3. Representations and Warranties of the Investor. The Investor represents
----------------------------------------------
and warrants to the Company as follows:
3.1 Organization. It is a college education fund validly existing
------------
under the laws of the State of New York, with all requisite power and authority
to conduct its business as now being conducted.
3.2 Authority. It has all college education fund right, power and
---------
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Investor and the consummation by it of the
7
<PAGE>
transactions contemplated hereby have been duly authorized by all necessary
college education fund action on behalf of the Investor. This Agreement has been
duly executed and delivered by and constitutes a legal, valid and binding
obligation of the Investor, enforceable in accordance with its terms, subject to
laws of general application relating to bankruptcy, insolvency and the relief of
debtors and rules of law governing specific performance, injunctive relief or
other equitable remedies. The execution and delivery of this Agreement do not,
and the consummation of the transactions contemplated hereby will not, conflict
with or result in any violation of any obligation under any provision of the
authorization statute or organizational or other charter documents of the
Investor or any judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to the Investor.
3.3 Information. The Investor represents that it has received all the
-----------
information it has requested from the Company and considers necessary or
appropriate for deciding whether to purchase the Shares. The delivery of any
information by the Company to the Investor shall not abrogate the
representations and warranties of the Company contained herein.
3.4 No Current Resale. The Investor is acquiring the Shares for its
-----------------
own account and not with a view to sale or distribution. Any such sale or
distribution shall be made only in compliance with the provisions of the
Securities Act of 1933, as amended (the "Securities Act") and all applicable
blue sky laws. The Investor acknowledges that the Shares are not now registered
under the Securities Act or any blue sky law, and might never be so registered.
The Investor further acknowledges that the stock certificate representing the
Shares will bear a customary securities-law restrictive legend.
8
<PAGE>
3.5 Status of Investor (Regulation D and HSR). The Investor is an
-----------------------------------------
"accredited investor" as such term is defined in Rule 501 as promulgated by the
SEC under the Securities Act.
4. Covenants.
---------
4.1 Registration of Shares.
----------------------
(a) The Company shall, before the later of (i) 20 days after the
SEC declares effective the Company's Form S-3 registration statement for the
resale of the Common Stock issued by the Company in exchange for its Series B
Convertible Participating Preferred Stock, and (ii) 45 days following the
Closing, prepare and file with the SEC a registration statement on Form S-1
under the Securities Act covering the resale of the Shares by the Investor
(subject to Section 4.1(g), the "Registration Statement"), and corresponding
applications for registration under the blue sky laws of any states for which
the Investor reasonably requests in writing to the Company that the Company
obtain such blue-sky registration (it being understood that in the vast majority
of states no such registration is legally required, due to the Company's Nasdaq
National Market listing or other reasons). The Company shall use its reasonable
diligent efforts to obtain effectiveness of the Registration Statement and such
blue sky registrations as soon thereafter as practicable, and in any event
within 90 days after the initial filing of the Registration Statement with the
SEC, and shall use its best efforts to keep the Registration Statement and such
blue sky registrations effective after that. Notwithstanding the foregoing, the
Company will only be required to maintain the effectiveness of the Registration
Statement and such blue sky registrations until the earlier of (a) such time as
all of the Shares have been disposed of by the Investor, or (b) such date on
which the Investor may legally dispose of all of the Shares held by it in one
transaction in the open market pursuant to Rule 144(k) under the Securities Act.
The Company shall also cause the Shares to be listed on the Nasdaq National
9
<PAGE>
Market and on any stock exchange on which the Common Stock may from time to time
be listed. The Company shall pay all fees and expenses incurred by the Company
in connection with preparing, filing, prosecuting and updating the Registration
Statement, such blue sky applications and registrations, and such listing,
including all registration and filing fees, listing fees, printing expenses, and
fees and disbursements of the Company's counsel and accountants.
(b) The Investor shall cooperate fully with the Company in the
preparation of such Registration Statement and blue sky applications and shall
provide to the Company all information and materials (including updated
information and materials) regarding itself and its proposed method of
disposition of the Shares and take all actions reasonably requested by the
Company to permit the Company to comply with applicable requirements of the SEC,
to comply with applicable requirements of the relevant blue sky laws, and to
obtain the desired acceleration of the effective date of such Registration
Statement.
(c) Subject to Section 4.1(d) hereof, the Company shall promptly
prepare and file with the SEC and any relevant blue sky authorities such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith as may be necessary to keep such Registration Statement
effective and to comply with (and enable the Investor to comply with) the
provisions of the Securities Act and Rule 415 thereunder with respect to the
disposition of all the Shares.
(d) During the effectiveness of the Registration Statement, the
Company shall promptly notify the Investor of the happening of any event or
other circumstance as the result of which, in the Company's judgment, (i) the
prospectus included in the Registration Statement, as then in effect, would
include an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not
10
<PAGE>
misleading in light of the circumstances then existing, or (ii) the offer or
resale of the Shares would otherwise have a material and adverse effect on any
proposed or pending acquisition, merger, business combination or other material
transaction involving the Company; and, upon receipt of such notice and until
the earlier of (i) the date the Company makes available to the Investor a
supplemented or amended prospectus meeting the requirements of the Securities
Act and relevant blue sky laws, or (ii) the date the Company notifies the
Investor that the Investor may resume offers and sales using the prior
prospectus, the Investor shall not offer or sell any Shares pursuant to the
Registration Statement (and shall return all copies of such prior prospectus to
the Company if requested to do so by it). Notwithstanding Section 4.1(c), the
Company may continue such "blackout" period or periods for such period of time
as the Company considers reasonably necessary and in its best interest due to
circumstances then existing, or simply due to the fact that
amendments/supplements of a Registration Statement/ prospectus cannot be
prepared instantly; but in no event may the Company impose "blackouts" on
---
the Investor for any period of ten or more consecutive business days or totaling
more than 20 days in any 12 month period (plus any "Permitted Blackouts" as
defined in the Registration Rights Agreement dated as of December 21, 1998
between the Company, Castle Creek Technology Partners LLC and others).
(e) The Company shall not be required to apply for or obtain
blue sky registration in any state if in connection therewith or as a condition
thereto it must (i) qualify to do business in such state where it would not
otherwise be required to qualify, (ii) subject itself to general taxation in
such state, (iii) file a general consent to service of process in such state, or
(iv) make any change in its Certificate of Incorporation or Bylaws, which the
Company's Board of Directors determines to be contrary to the best interests of
the Company and its stockholders.
11
<PAGE>
(f) Indemnification.
---------------
(i) The Company will indemnify the Investor, and each of
the officers and directors of, and each person controlling, the Investor,
against all claims, losses, expenses, damages and liabilities (or actions in
respect thereto) arising out of or based on (A) any untrue statements (or
alleged untrue statement) of a material fact contained in any prospectus
contained in any registration statement covering the Shares for resale, or based
on any omission (or alleged omission) to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or (B) any misrepresentation or breach of any representation or warranty given
or made by the Company in this Agreement, and will reimburse the Investor, each
of its officers and directors and each person controlling the Investor, for any
reasonable legal and any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability or
action, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage or liability is caused by any untrue
statement or omission based upon written information furnished to the Company by
the Investor specifically for use therein.
(ii) The Investor will indemnify the Company, each of its
directors and officers, and each person who controls the Company within the
meaning of the Securities Act, against all claims, losses, expenses, damages and
liabilities (or actions in respect thereof) arising out of or based on (A) any
untrue statement (or alleged untrue statement) of a material fact contained in
any such prospectus, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (B) any sale of Shares which violates (or allegedly
violates) the Securities Act because of violation of the prospectus delivery
requirement or because more or less than the
12
<PAGE>
information in such prospectus is given (or alleged to be given) in connection
with the sale, or (C) any misrepresentation or breach of any representation or
warranty given or made by the Investor in this Agreement, and will reimburse the
Company, and such directors, officers, or controlling persons, for any
reasonable legal or any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability or
action, but in the case of subsection (f)(ii)(A) to the extent, and only to the
extent, that such untrue statement (or alleged untrue statement) or omission (or
alleged omission) is made in such prospectus in reliance upon and in conformity
with written information furnished to the Company by the Investor specifically
for use therein.
(iii) Each party entitled to indemnification under this Section
4.1(f) (the "Indemnified Party") shall give notice to the party required to
provide indemnification (the "Indemnifying Party") promptly after such
indemnified party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not be
unreasonably withheld), and the Indemnified Party may participate in such
defense at the Indemnified Party's expense, and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations hereunder, unless such failure
resulted in actual detriment to the Indemnifying Party. The Indemnified Party
shall provide all cooperation reasonably requested for the defense of the claim
or litigation. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
13
<PAGE>
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation. An Indemnified Party shall not decline any settlement complying with
the foregoing if it requires nothing of the Indemnified Party other than the
payment of money (which is in fact paid by the Indemnifying Party) and does not
include an admission of liability.
(iv) In order to provide for just and equitable contribution
to joint liability under the Securities Act in any case in which any person or
entity entitled to indemnification under Section 4.1(f) makes a claim for
indemnification pursuant to this Section 4.1(f) but it is judicially determined
(by entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 4.1(f) provides for indemnification in such case; then, and in
such case, the party that would otherwise be required to indemnify under Section
4.1(f) will contribute to the aggregate losses, claims, damages or liabilities
to which the other parties may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the parties
in connection with the losses suffered, as well as any other relevant equitable
considerations.
(g) The parties agree that if the Company becomes eligible to
register securities for resale on Form S-3 it may choose to register the Shares
for resale on Form S-3 and, after the SEC declares such Form S-3 registration
statement effective, so notify the Investor, provide all relevant deliverables
(such as a supply of new prospectuses), and then deregister the Shares from the
original Form S-1 Registration Statement. Thereafter such Form S-3
14
<PAGE>
Registration Statement shall, for all purposes of this Agreement, be deemed to
be the "Registration Statement."
4.2 Deliverables Upon Effectiveness. When and if the SEC declares the
-------------------------------
Registration Statement effective, the Company shall promptly deliver to the
Investor:
(a) A certificate signed by the President of the Company and
that the Registration Statement is effective and, to his knowledge, no stop
order with respect to the Registration Statement has been issued and no
proceedings therefor have been instituted.
(b) A legal opinion of Brobeck, Phleger & Harrison LLP, counsel
to the Company, in substantially the form of Exhibit B.
(c) Such number of copies of the Registration Statement and
(from time to time) of each amendment and supplement thereto, such number of
copies of the prospectus (including (from time to time) any supplemental or
amended prospectus) included in such Registration Statement, and such other
related documents as the Investor may reasonably request in writing in order to
facilitate the disposition of the Shares by the Investor.
4.3 Current Public Information. As long as the Investor owns any
--------------------------
Shares, the Company shall use its best efforts to properly file all SEC Reports,
or otherwise make available "adequate current public information" about itself,
within the meaning of Rule 144(c) under the Securities Act, to potentially make
available to the Investor the benefits of certain rules and regulations of the
SEC which may permit the sale of the Shares without registration.
5. Conditions of the Investor's Obligations at Closing. The obligations of
---------------------------------------------------
the Investor under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Investor:
15
<PAGE>
5.1 Bringdown. The Company's representations and warranties in
---------
Section 2 shall be true in all material respects, as if made on and as of the
date of the Closing. The Company shall have performed or fulfilled in all
material respects all agreements, obligations and conditions contained herein
required to be performed or fulfilled by the Company before such Closing.
5.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
5.3 Compliance Certificate. The Company shall have delivered to the
----------------------
Investor a certificate dated as of the date of the Closing signed by the Chief
Executive Officer or President of the Company certifying that, to his knowledge,
the conditions set forth in Sections 5.1, 5.2, 5.5, 5.6, and 5.7 have been
satisfied.
5.4 Opinion of Counsel. There shall have been delivered to the
------------------
Investor an opinion of Brobeck, Phleger & Harrison LLP, counsel to the Company,
in substantially the form of Exhibit A.
5.5 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
5.6 No Material Litigation. During the period from the date of this
----------------------
Agreement to the Closing, no material litigation shall have been initiated
challenging the Company's ownership or its right to use or distribute the core
technology of the Company's products, and the Company shall have not received
any written threat of such litigation or any written claim so challenging the
Company's rights.
16
<PAGE>
5.7 No Fraud or Malfeasance. During the period from the date of this
-----------------------
Agreement to the Closing, (a) none of the Company's officers or directors shall
have been removed for fraud or malfeasance in performance of his or her duties
with respect to the affairs of the Company and (b) no new legal proceedings
against any officers or directors of the Company for fraud or malfeasance in the
performance of his or her duties with respect to the affairs of the Company
shall have been instituted by the Company or its stockholders.
6. Conditions of the Company's Obligations at Closing. The obligations of
--------------------------------------------------
the Company under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Company:
6.1 Bringdown. The Investor's representations and warranties in
---------
Section 3 shall be true in all material respects, as if made on and as of the
date of the Closing.
6.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
6.3 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
7. Miscellaneous.
-------------
7.1 Entire Agreement. This Agreement constitUtes the entire contract
----------------
between the Company and the Investor relative to the subject matter hereof. Any
previous or contemporaneous agreements, understandings, promises and
representations (whether written or oral) with regard to such subject between
the Company and the Investor are superseded by this Agreement.
17
<PAGE>
7.2 Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the State of California applicable to contracts
entered into and wholly to be performed within the State of California by
California residents.
7.3 Counterparts. This Agreement may be executed in counterparts,
------------
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
7.4 Headings. The headings of the Sections and subsections of this
--------
Agreement are for convenience and shall not determine the interpretation of this
Agreement.
7.5 Notices. Any notice required or permitted hereunder shall be
-------
given in writing and shall be conclusively deemed effectively given upon
personal delivery, or, if made by registered or certified United States mail,
postage prepaid, four business days after mailing, or if made by overnight
carrier, one business day after sending, in all instances addressed (i) if to
the Company, as set forth below the Company's name on the signature page of this
Agreement, and (ii) if to the Investor, as set forth below the Investor's name
on the signature page to this Agreement, or at such other address as the Company
or the Investor may designate by ten days' advance written notice to the
Investor or the Company, respectively.
7.6 Survival of Warranties. The representations and warranties of the
----------------------
parties contained in or made pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the Closing for three years;
provided, however, that such representations and warranties need only be
accurate as of the date of such execution and delivery.
7.7 Amendment of Agreement. Any provision of this Agreement may be
----------------------
modified or amended, at any time, by a written instrument signed by the Company
and by the Investor, and not in any other way.
18
<PAGE>
7.8 Fees and Expenses. The Company and the Investor will each bear
-----------------
their own fees and expenses in connection with the transactions contemplated by
this Agreement .
7.9 Finders' Fees. The Company will hold the Investor harmless from
-------------
all finders' or brokers' fees in connection with the sale of the Shares to the
Investor.
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
PIPES Purchase Agreement as of the day and year first above written.
P-COM, INC., a Delaware corporation
By: /s/ George P. Roberts
_________________________________________
Title: Chief Executive Officer
_________________________________________
Address: 3175 S. Winchester Boulevard
Campbell, CA 95008
Attention: Chief Financial Officer
TRUSTEES OF HAMILTON COLLEGE, a New York college
education fund
By: /s/ Thomas O'Lloyd-Butler
-----------------------------------------
Title: Member Manager of Gruber McBaine Capital
-----------------------------------------
Management LLC as Investment Advisor of
Trustees of Hamilton College
Address: c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
19
<PAGE>
EXHIBIT A
June 22, 1999
Trustees of Hamilton College
c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of shares of its
common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you. This opinion letter is being rendered to you pursuant to
Section 5.4 of the Stock Purchase Agreement in connection with the Closing of
the sale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In connection with the opinions expressed herein, we have made such
examination of matters of law and of fact as we considered appropriate or
advisable for purposes hereof. As to matters of fact material to the opinions
expressed herein, we have relied upon the representations and warranties as to
factual matters contained in and made by the Company pursuant to the Stock
Purchase Agreement and upon certificates and statements of government officials
and of officers of the Company. We have also examined originals or copies of
such corporate documents or records of the Company as we have considered
appropriate for the opinions expressed herein. We have assumed for the purposes
of this opinion letter the genuineness of all signatures, the legal capacity of
natural persons, the authenticity of the documents submitted to us as originals,
the conformity to the original documents of all documents submitted to us as
certified, facsimile or photostatic copies, and the authenticity of the
originals of such copies.
In rendering this opinion letter we have also assumed: (A) that the Stock
Purchase Agreement has been duly and validly executed and delivered by you or on
your behalf, that you have the power to enter into and perform all your
obligations thereunder, and that the Stock Purchase Agreement constitutes a
valid, legal, binding and enforceable obligation upon you; (B) that the
representations and warranties made in the Stock Purchase Agreement by you are
true and correct; and (C) that any wire transfers, drafts or checks tendered by
you will be honored.
As used in this opinion letter, the expression "we are not aware" or the
phrase "to our knowledge", or any similar expression or phrase with respect to
our knowledge of matters of fact, means as to matters of fact that, based on the
actual knowledge of individual attorneys within the firm principally responsible
for handling current matters for the Company (and not including any constructive
or imputed notice of any information), and after an examination of
<PAGE>
documents referred to herein and after inquiries of certain officers of the
Company, no facts have been disclosed to us that have caused us to conclude that
the opinions expressed are factually incorrect; but beyond that we have made no
factual investigation for the purposes of rendering this opinion letter.
Specifically, but without limitation, we have not searched the dockets of any
courts and we have made no inquiries of securities holders or employees of the
Company, other than such officers.
This opinion letter relates solely to the laws of the State of California,
the General Corporation Law of the State of Delaware and the federal law of the
United States and we express no opinion with respect to the effect or
application of any other laws. Special rulings of authorities administering
such laws or opinions of other counsel have not been sought or obtained.
Based upon our examination of and reliance upon the foregoing and subject
to the limitations, exceptions, qualifications and assumptions set forth below
and except as set forth in the Stock Purchase Agreement or the Disclosure
Schedule thereto, we are of the opinion that as of the date hereof:
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, and the Company has
the requisite corporate power and authority to own its properties and to conduct
its business as, to our knowledge, it is presently conducted. The Company is
qualified to do business as a foreign corporation in the state of California.
2. The Company has the requisite corporate power and authority to
execute, deliver and perform the Stock Purchase Agreement. The Stock Purchase
Agreement has been duly and validly authorized by the Company, duly executed and
delivered by an authorized officer of the Company and constitutes a legal, valid
and binding obligation of the Company, enforceable by you against the Company in
accordance with its terms.
3. The Shares have been duly authorized and, upon purchase at the Closing
pursuant to the terms of the Stock Purchase Agreement, will be validly issued,
nonassessable and fully paid, and free of any liens created by the Company.
4. The Company's execution and delivery of, and its performance and
compliance as of the date hereof with the terms of, the Stock Purchase Agreement
do not violate any provision of any federal, Delaware corporate or California
law, rule or regulation applicable to the Company or any provision of the
Company's Restated Certificate of Incorporation or Bylaws and do not conflict
with or constitute a default under the provisions of any judgment, writ, decree
or order specifically identified in the SEC Reports or the material provisions
of any of the material agreements specifically identified in the SEC Reports.
5. Other than in connection with any securities laws, all consents,
approvals, permits, orders or authorizations of, and all qualifications by and
registrations with, any federal or Delaware corporate or California state
governmental authority on the part of the Company required in connection with
the execution and delivery of the Stock Purchase Agreement and
A-2
<PAGE>
consummation at the Closing of the transactions contemplated by the Stock
Purchase Agreement have been obtained, and are effective, and we are not aware
of any proceedings, or written threat of any proceedings, that question the
validity thereof.
6. Based in part upon the representations of you in the Stock Purchase
Agreement, the offer and sale of the Shares to you pursuant to the terms of the
Stock Purchase Agreement are exempt from the registration requirements of
Section 5 of the Securities Act of 1933, as amended, and from the qualification
requirements of the California Corporate Securities Law of 1968, as amended.
Our opinions expressed above are specifically subject to the following
limitations, exceptions, qualifications and assumptions:
(A) The legality, validity, binding nature and enforceability of the
Company's obligations under the Stock Purchase Agreement may be subject to or
limited by (1) bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent transfer and other similar laws affecting the rights of creditors
generally; (2) general principles of equity (whether relief is sought in a
proceeding at law or in equity), including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the discretion of
any court of competent jurisdiction in awarding specific performance or
injunctive relief and other equitable remedies; and (3), without limiting the
generality of the foregoing, the effect of California court decisions and
statutes which indicate that provisions of the Stock Purchase Agreement which
permit you to take action or make determinations may be subject to a requirement
that such action be taken or such determinations be made on a reasonable basis
in good faith or that it be shown that such action is reasonably necessary for
your protection.
(B) We express no opinion as to the Company's compliance or noncompliance
with applicable federal or state antifraud or antitrust statutes, laws, rules
and regulations.
(C) We express no opinion concerning the past, present or future fair
market value of any securities.
(D) We express no opinion as to the enforceability under certain
circumstances of any provisions indemnifying a party against, or requiring
contributions toward, that party's liability for its own wrongful or negligent
acts, or where indemnification or contribution is contrary to public policy or
prohibited by law. In this regard, we advise you that in the opinion of the
Securities and Exchange Commission, indemnification of directors, officers and
controlling persons of an issuer against liabilities arising under the
Securities Act of 1933, as amended, is against public policy and is therefore
unenforceable.
(E) We express no opinion as to the enforceability under certain
circumstances of any provisions prohibiting waivers of any terms of the Stock
Purchase Agreement other than in writing, or prohibiting oral modifications
thereof or modification by course of dealing. In addition, our opinions are
subject to the effect of judicial decisions which may permit the introduction of
extrinsic evidence to interpret the terms of written contracts.
A-3
<PAGE>
(F) We express no opinion as to the effect of Section 1670.5 of the
California Civil Code or any other California law, federal law or equitable
principle which provides that a court may refuse to enforce, or may limit the
application of, a contract or any clause thereof which the court finds to have
been unconscionable at the time it was made or contrary to public policy.
(G) We express no opinion as to your compliance with any Federal or state
law relating to your legal or regulatory status.
(H) We express no opinion as to the compliance of the Company, the
Investor or the sale of the Common Stock to the Investor with the provisions of
the Small Business Investment Act of 1958, as amended, or any of the regulations
promulgated thereunder.
(I) We express no opinion as to the effect of subsequent issuances of
securities of the Company, to the extent that further issuances which may be
integrated with the Closing may include purchasers that do not meet the
definition of "accredited investors" under Rule 501 of Regulation D and
equivalent definitions under state securities or "blue sky" laws.
(J) We express no opinion as to Section 7.2 of the Stock Purchase
Agreement to the extent that it purports to exclude conflict of law principles
under California law.
(K) With your permission, we express no opinion regarding the Hart-Scott-
Rodino Antitrust Improvements Act of 1976.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and may not be
delivered to, quoted or relied upon by any person other than you, or for any
other purpose, without our prior written consent. Our opinion is expressly
limited to the matters set forth above and we render no opinion, whether by
implication or otherwise, as to any other matters relating to the Company or the
Shares. We assume no obligation to advise you of facts, circumstances, events
or developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
A-4
<PAGE>
EXHIBIT B
_____________, 1999
Trustees of Hamilton College
c/o Gruber McBaine Investment Advisors LLC
Attn: Christine Arroyo
50 Osgood Place, Penthouse
San Francisco, CA 94133
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of certain Shares of
its common stock, par value $.0001 per share, pursuant to the Common Stock
PIPES Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement")
between the Company and you and in connection with the Company's registration
with the SEC of such Shares for resale by you. This opinion letter is being
rendered to you pursuant to Section 4.2(b) of the Stock Purchase Agreement in
connection with the SEC declaring effective the Registration Statement for your
resale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In our capacity as counsel to the Company, we have examined, among other
things, originals, or copies identified to our satisfaction as being true
copies, of the Registration Statement on Form S-1 (File No. 333-____________)
initially filed by the Company with the SEC on ____________, 1999, for the
purpose of registering the resale of the Shares under the Securities Act;
Amendment No. 1 to such Registration Statement filed with the SEC on
_____________, 1999; Amendment No. 2 to such Registration Statement filed with
the SEC on _____________, 1999; and oral advice on ______________, 1999, from an
SEC staff examiner, that the SEC had declared such Registration Statement, as so
amended, effective as of ______ p.m., Washington, D.C. time, on _____________,
1999.
As used in this opinion letter, the phrase "to our knowledge" means as to
matters of fact that, based on the actual knowledge of individual attorneys
within the firm principally responsible for handling current matters for the
Company (and not including any constructive or imputed notice of any
information), no facts have been disclosed to us that have caused us to conclude
that the opinions expressed are factually incorrect; but our affirmative factual
investigation for the purpose of rendering this opinion letter has been limited
to obtaining (a) oral advice received on ___________, from an SEC staff
examiner, that the SEC had declared such Registration Statement, as amended,
effective at _____ p.m. Washington, D.C. time, on _________ , 1999 and (b) oral
advice received on ___________, 1999 from an SEC staff examiner that there is no
stop order suspending the effectiveness of the Registration Statement.
Based upon our examination of and reliance upon the foregoing, we are of
the opinion that as of the date hereof:
<PAGE>
1. The Registration Statement has become effective under the Securities
Act and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose are
pending before or contemplated by the SEC.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and the
Registration Statement and may not be delivered to, quoted or relied upon by any
person other than you, or for any other purpose, without our prior written
consent. Our opinion is expressly limited to the matters set forth above and we
render no opinion, whether by implication or otherwise, as to any other matters
relating to the Company, the Stock Purchase Agreement, the Registration
Statement or the Shares. We assume no obligation to advise you of facts,
circumstances, events or developments which hereafter may be brought to our
attention and which may alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
B-2
<PAGE>
EXHIBIT 10.52
COMMON STOCK PIPES PURCHASE AGREEMENT
THIS COMMON STOCK PIPES PURCHASE AGREEMENT (the "Agreement") is made as of
June 21, 1999, by and between P-Com, Inc., a Delaware corporation (the
"Company"), and the State of Wisconsin Investment Board, an agency of the
State of Wisconsin (the "Investor").
RECITALS:
--------
A. The Company desires to sell shares of the Company's Common Stock,
$.0001 par value ("Common Stock") to the Investor, and the Investor desires to
purchase shares of Common Stock, on the terms and subject to the conditions
set forth in this Agreement.
THE PARTIES AGREE AS FOLLOWS:
1. Purchase and Sale of Common Stock.
---------------------------------
1.1 Sale and Issuance of Common Stock. The Company shall sell to the
---------------------------------
Investor and the Investor shall purchase from the Company, on the date of the
Closing (as defined in Section 1.2 below), at a price per share equal to the
Formula Price (as defined in Section 1.3 below), that number of shares of
Common Stock equal to the quotient of $20,000,000 divided by the Formula Price
(the "Shares").
1.2 Closing. The purchase and sale of the Shares shall take place at
-------
11:00 a.m. Pacific Daylight Time on June 22, 1999, at the offices of Brobeck,
Phleger & Harrison LLP, 550 West "C" Street, San Diego, California 92101, or
on such date and at such time and place as the Company and the Investor shall
mutually agree (the "Closing"). At the Closing the Company shall deliver to
the Investor a stock certificate representing the Shares against delivery to
the Company by the Investor of $20,000,000 by wire to the Company.
<PAGE>
1.3 Formula Price. The "Formula Price" means the product of 92.5%
-------------
times the mean average of the 15 closing sale prices of the Common Stock, as
reported by the Nasdaq National Market, for the 15 consecutive trading days
ending on and including June 17, 1999; i.e., the Formula Price is $3.973.
2. Representations and Warranties of the Company. For purposes of this
---------------------------------------------
Section 2, unless the context otherwise requires, the term "Company" shall
include the Company and its subsidiaries as listed in its most recent Annual
Report on Form 10-K/A for the year ended December 31, 1998 (the "Annual
Report") filed with the Securities and Exchange Commission (the "SEC"). Except
as set forth in the Disclosure Schedule delivered to the Investor
supplementally (the "Disclosure Schedule"), the Company hereby represents and
warrants to the Investor as follows:
2.1 Corporate Organization and Authority of the Company. The Company
---------------------------------------------------
and each of its subsidiaries:
(a) is a corporation duly organized, validly existing,
authorized to exercise all its corporate powers, rights and privileges and in
good standing in the state or jurisdiction of its incorporation;
(b) has the corporate power and authority to own and operate its
properties and to carry on its business as presently conducted and as proposed
to be conducted; and
(c) is qualified to do business as a foreign corporation in each
jurisdiction in which the ownership of its property or the nature of its
business requires such qualification, except where failure to so qualify would
not have a materially adverse effect on the business, properties or financial
condition of the Company and its subsidiaries, taken as a whole. The
2
<PAGE>
Company has furnished to the Investor true and correct copies of its
Certificate of Incorporation and Bylaws, each as amended to date.
2.2 Capitalization. The authorized capital stock of the Company
--------------
consists of:
(a) Preferred Stock. 2,000,000 shares of Preferred Stock, $.0001
---------------
par value, The authorized capital stock of the Company consists of: 750,000
shares of which have been designated Series A Junior Participating Preferred
Stock, of which none were issued and outstanding as of June 21, 1999.
(b) Common Stock. 95,000,000 shares of Common Stock, $.0001 par
------------
value, of which 54,101,545 shares were issued and outstanding as of June 21,
1999.
(c) All outstanding shares of the Company's Common Stock have
been duly authorized and validly issued (including, without limitation, issued
in compliance with applicable federal and state securities laws), and are
fully paid and nonassessable.
(d) Since June 21, 1999, the Company has not issued any shares
of Common Stock or Preferred Stock except in connection with the exercise of
outstanding options or warrants. Except as described in the Disclosure
Schedule, there are no options, warrants, conversion privileges or other
contractual rights presently outstanding to purchase or otherwise acquire from
the Company any shares of the Company's capital stock or other securities
(whether or not authorized).
2.3 Subsidiaries. The Company does not presently own, have any
------------
investment in, or control, directly or indirectly, any subsidiaries,
associations or other business entities, except as disclosed in the Annual
Report. The Company is not a participant in any joint venture or partnership,
except as disclosed in the Annual Report.
2.4 Authorization. All corporate action on the part of the Company,
-------------
its officers, directors and stockholders necessary for the authorization,
execution, delivery and performance
3
<PAGE>
by the Company of all its obligations under this Agreement and for the
authorization, issuance, sale and delivery of the Shares has been taken, and
this Agreement, once executed by the Company and the Investor, will constitute
a legally binding and valid obligation of the Company enforceable in
accordance with its terms, such enforceability being subject only to laws of
general application relating to bankruptcy, insolvency and the relief of
debtors and rules of law governing specific performance, injunctive relief or
other equitable remedies. Except for rights, if any, which have been duly
waived, the issuance and sale of the Shares will not give rise to any
preemptive rights or rights of first refusal on behalf of any person in
existence on the date hereof.
2.5 Validity of Shares. The Shares, when issued, sold and delivered
------------------
in accordance with the terms and for the consideration expressed in this
Agreement, shall be duly and validly issued (including, without limitation,
compliance with applicable federal and state securities laws), fully paid and
nonassessable.
2.6 No Conflict. The execution and delivery of this Agreement do not,
-----------
and the consummation of the transactions contemplated hereby will not,
conflict with, or result in any violation of, or default (with or without
notice or lapse in time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or to a loss of a
material benefit under, any provision of the Certificate of Incorporation or
Bylaws of the Company. The execution and delivery of this Agreement do not,
and the consummation of the transactions contemplated hereby will not,
conflict with, or result in any violation of, or default (with or without
notice or lapse in time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or to a loss of a
material benefit under, any provision of any mortgage, indenture, lease or
other agreement or instrument, permit, concession, franchise, license,
judgment, order, decree, statute, law, ordinance, rule or regulation
applicable to the
4
<PAGE>
Company, its properties or assets, the effect of which could have a material
adverse effect on the Company or materially impair or restrict its power to
perform its obligations as contemplated hereby.
2.7 Accuracy of Reports. The Annual Report, the Company's quarterly
-------------------
report on Form 10-Q for the quarter ended March 31, 1999 filed with the SEC
(the "Quarterly Report"), and all reports required to be filed by the Company
thereafter to the date of this Agreement under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), copies of which have been furnished to
the Investor (together, the "SEC Reports"), have been duly filed, were (as
amended to date) complete and correct in all material respects as of the dates
at which the information was furnished, and (as amended to date) contained (as
of such dates) no untrue statement of a material fact nor omitted to state a
material fact necessary in order to make the statements made therein, in light
of the circumstances in which they were made, not misleading.
2.8 Changes. Except as otherwise disclosed herein, in the Disclosure
-------
Schedule or in the SEC Reports, between March 31, 1999 and the date of this
Agreement there has not been:
(a) any change in the assets, liabilities, financial condition,
prospects or operations of the Company from that reflected in the Quarterly
Report, except changes in the ordinary course of business which have not been,
either in any individual case or in the aggregate, materially adverse;
(b) any material change in the contingent obligations of the
Company, whether by way of guaranty, endorsement, indemnity, warranty or
otherwise;
(c) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties or business of
the Company;
5
<PAGE>
(d) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(e) any labor organization activity; or
(f) to the best of the Company's knowledge, any other event or
condition of any character which has materially and adversely affected the
Company's assets, liabilities, financial condition, prospects or operations.
2.9 Government Consent, etc. No consent, approval or authorization of
------------------------
or designation, declaration or filing with any governmental authority on the
part of the Company is required in connection with the valid execution and
delivery of this Agreement, or the offer, sale or issuance of the Shares, or
the consummation of any other transaction contemplated hereby, except the
filing of a Registration Statement and related activities pursuant to Section
4 hereof.
2.10 Full Disclosure. The representations and warranties of the
---------------
Company contained in this Agreement, when read together with the Disclosure
Schedule and the SEC Reports, do not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements contained herein, in light of the circumstances under which
they were made, not misleading.
2.11 Conflicts Prohibited. The Company represents, warrants and
--------------------
covenants that to the best of its knowledge no officer or employee of Investor
has a direct or indirect economic interest in the Company or its property or
contracts other than as disclosed in the SEC Reports, nor will any officer or
employee of Investor receive, directly or indirectly, anything of substantial
economic value for his or her private benefit from the Company or anyone
acting on its behalf in connection with the investment made pursuant to this
Agreement.
6
<PAGE>
2.12 Intellectual Property. The Company has not violated and is not
---------------------
currently in violation of any copyright, trademark or other intellectual
property rights of any third persons, except to the extent that such violation
does not materially and adversely affect the Company or its operations.
2.13 Litigation/Bankruptcy/Malfeasance. The Company is not the subject
---------------------------------
of and has not received notice of any legal proceedings of the following types
to which the Company is a party (or, if applicable, any executive officer or
director of the Company) or any of its property is the subject: any proceeding
that involves a claim against the Company for damages in excess of $500,000;
any material bankruptcy, receivership or similar proceedings with respect to
the Company; or any criminal proceedings or civil proceedings for fraud or
malfeasance of which a director or executive officer of the Company is the
subject (excluding minor offenses).
3. Representations and Warranties of the Investor. The Investor
----------------------------------------------
represents and warrants to the Company as follows:
3.1 Organization. It is an agency of the State of Wisconsin, duly
------------
created by statute and validly existing under the laws of the State of
Wisconsin, with all requisite power and authority to conduct its business as
now being conducted.
3.2 Authority. It has all government-agency right, power and
---------
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Investor and the consummation by it of the transactions contemplated hereby
have been duly authorized by all necessary government-agency action on behalf
of the Investor. This Agreement has been duly executed and delivered by and
constitutes
7
<PAGE>
a legal, valid and binding obligation of the Investor, enforceable in
accordance with its terms, subject to laws of general application relating to
bankruptcy, insolvency and the relief of debtors and rules of law governing
specific performance, injunctive relief or other equitable remedies. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated hereby will not, conflict with or result in any
violation of any obligation under any provision of the authorization statute
or organizational or other charter documents of the Investor or any judgment,
order, decree, statute, law, ordinance, rule or regulation applicable to the
Investor.
3.3 Information. The Investor represents that it has received all the
-----------
information it has requested from the Company and considers necessary or
appropriate for deciding whether to purchase the Shares. The delivery of any
information by the Company to the Investor shall not abrogate the
representations and warranties of the Company contained herein.
3.4 No Current Resale. The Investor is acquiring the Shares for its own
-----------------
account and not with a view to sale or distribution. Any such sale or
distribution shall be made only in compliance with the provisions of the
Securities Act of 1933, as amended (the "Securities Act") and all applicable
blue sky laws. The Investor acknowledges that the Shares are not now
registered under the Securities Act or any blue sky law, and might never be so
registered. The Investor further acknowledges that the stock certificate
representing the Shares will bear a customary securities-law restrictive
legend.
3.5 Status of Investor (Regulation D and HSR). The Investor is an
-----------------------------------------
"accredited investor" as such term is defined in Rule 501 as promulgated by
the SEC under the Securities Act. The nature of the Investor results in the
filing/waiting requirement of the Hart-Scott-Rodino Antitrust Improvements Act
of 1976 not being applicable to this transaction.
8
<PAGE>
4. Covenants.
---------
4.1 Registration of Shares.
----------------------
(a) The Company shall, before the later of (i) 20 days after the
SEC declares effective the Company's Form S-3 registration statement for the
resale of the Common Stock issued by the Company in exchange for its Series B
Convertible Participating Preferred Stock, and (ii) 45 days following the
Closing, prepare and file with the SEC a registration statement on Form S-1
under the Securities Act covering the resale of the Shares by the Investor
(subject to Section 4.1(g), the "Registration Statement"), and corresponding
applications for registration under the blue sky laws of any states for which
the Investor reasonably requests in writing to the Company that the Company
obtain such blue-sky registration (it being understood that in the vast
majority of states no such registration is legally required, due to the
Company's Nasdaq National Market listing or other reasons). The Company shall
use its reasonable diligent efforts to obtain effectiveness of the
Registration Statement and such blue sky registrations as soon thereafter as
practicable, and in any event within 90 days after the initial filing of the
Registration Statement with the SEC, and shall use its best efforts to keep
the Registration Statement and such blue sky registrations effective after
that. Notwithstanding the foregoing, the Company will only be required to
maintain the effectiveness of the Registration Statement and such blue sky
registrations until the earlier of (a) such time as all of the Shares have
been disposed of by the Investor, or (b) such date on which the Investor may
legally dispose of all of the Shares held by it in one transaction in the open
market pursuant to Rule 144(k) under the Securities Act. The Company shall
also cause the Shares to be listed on the Nasdaq National Market and on any
stock exchange on which the Common Stock may from time to time be listed. The
Company shall pay all fees and expenses incurred by the Company in connection
with preparing, filing, prosecuting and updating the Registration Statement,
such blue sky applications
9
<PAGE>
and registrations, and such listing, including all registration and filing
fees, listing fees, printing expenses, and fees and disbursements of the
Company's counsel and accountants.
(b) The Investor shall cooperate fully with the Company in the
preparation of such Registration Statement and blue sky applications and shall
provide to the Company all information and materials (including updated
information and materials) regarding itself and its proposed method of
disposition of the Shares and take all actions reasonably requested by the
Company to permit the Company to comply with applicable requirements of the
SEC, to comply with applicable requirements of the relevant blue sky laws, and
to obtain the desired acceleration of the effective date of such Registration
Statement.
(c) Subject to Section 4.1(d) hereof, the Company shall promptly
prepare and file with the SEC and any relevant blue sky authorities such
amendments and supplements to the Registration Statement and the prospectus
used in connection therewith as may be necessary to keep such Registration
Statement effective and to comply with (and enable the Investor to comply
with) the provisions of the Securities Act and Rule 415 thereunder with
respect to the disposition of all the Shares.
(d) During the effectiveness of the Registration Statement, the
Company shall promptly notify the Investor of the happening of any event or
other circumstance as the result of which, in the Company's judgment, (i) the
prospectus included in the Registration Statement, as then in effect, would
include an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing, or (ii) the offer
or resale of the Shares would otherwise have a material and adverse effect on
any proposed or pending acquisition, merger, business combination or other
material transaction involving the Company; and, upon
10
<PAGE>
receipt of such notice and until the earlier of (i) the date the Company makes
available to the Investor a supplemented or amended prospectus meeting the
requirements of the Securities Act and relevant blue sky laws, or (ii) the
date the Company notifies the Investor that the Investor may resume offers and
sales using the prior prospectus, the Investor shall not offer or sell any
Shares pursuant to the Registration Statement (and shall return all copies of
such prior prospectus to the Company if requested to do so by it).
Notwithstanding Section 4.1(c), the Company may continue such "blackout"
period or periods for such period of time as the Company considers reasonably
necessary and in its best interest due to circumstances then existing, or
simply due to the fact that amendments/supplements of a Registration
Statement/ prospectus cannot be prepared instantly; but in no event may the
---
Company impose "blackouts" on the Investor for any period of ten or more
consecutive business days or totaling more than 20 days in any 12 month period
(plus any "Permitted Blackouts" as defined in the Registration Rights
Agreement dated as of December 21, 1998 between the Company, Castle Creek
Technology Partners LLC and others).
(e) The Company shall not be required to apply for or obtain
blue sky registration in any state if in connection therewith or as a
condition thereto it must (i) qualify to do business in such state where it
would not otherwise be required to qualify, (ii) subject itself to general
taxation in such state, (iii) file a general consent to service of process in
such state, or (iv) make any change in its Certificate of Incorporation or
Bylaws, which the Company's Board of Directors determines to be contrary to
the best interests of the Company and its stockholders.
(f) Indemnification.
---------------
(i) The Company will indemnify the Investor, and each
of the officers and directors of, and each person controlling, the Investor,
against all claims, losses,
11
<PAGE>
expenses, damages and liabilities (or actions in respect thereto) arising out
of or based on (A) any untrue statements (or alleged untrue statement) of a
material fact contained in any prospectus contained in any registration
statement covering the Shares for resale, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (B) any
misrepresentation or breach of any representation or warranty given or made by
the Company in this Agreement, and will reimburse the Investor, each of its
officers and directors and each person controlling the Investor, for any
reasonable legal and any other expenses incurred in connection with
investigating, defending or settling any such claim, loss, damage, liability
or action, provided that the Company will not be liable in any such case to
the extent that any such claim, loss, damage or liability is caused by any
untrue statement or omission based upon written information furnished to the
Company by the Investor specifically for use therein.
(ii) The Investor will indemnify the Company, each of
its directors and officers, and each person who controls the Company within
the meaning of the Securities Act, against all claims, losses, expenses,
damages and liabilities (or actions in respect thereof) arising out of or
based on (A) any untrue statement (or alleged untrue statement) of a material
fact contained in any such prospectus, or any omission (or alleged omission)
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, or (B) any sale of Shares which
violates (or allegedly violates) the Securities Act because of violation of
the prospectus delivery requirement or because more or less than the
information in such prospectus is given (or alleged to be given) in connection
with the sale, or (C) any misrepresentation or breach of any representation or
warranty given or made by the Investor in this Agreement, and will reimburse
the Company, and such directors, officers, or
12
<PAGE>
controlling persons, for any reasonable legal or any other expenses incurred in
connection with investigating, defending or settling any such claim, loss,
damage, liability or action, but in the case of subsection (f)(ii)(A) to the
extent, and only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such prospectus in
reliance upon and in conformity with written information furnished to the
Company by the Investor specifically for use therein.
(iii) Each party entitled to indemnification under this Section
4.1(f) (the "Indemnified Party") shall give notice to the party required to
provide indemnification (the "Indemnifying Party") promptly after such
indemnified party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not be
unreasonably withheld), and the Indemnified Party may participate in such
defense at the Indemnified Party's expense, and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations hereunder, unless such failure
resulted in actual detriment to the Indemnifying Party. The Indemnified Party
shall provide all cooperation reasonably requested for the defense of the claim
or litigation. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation. An Indemnified Party shall not decline any settlement complying with
the foregoing if it requires nothing of the Indemnified
13
<PAGE>
Party other than the payment of money (which is in fact paid by the Indemnifying
Party) and does not include an admission of liability.
(iv) In order to provide for just and equitable contribution
to joint liability under the Securities Act in any case in which any person or
entity entitled to indemnification under Section 4.1(f) makes a claim for
indemnification pursuant to this Section 4.1(f) but it is judicially determined
(by entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 4.1(f) provides for indemnification in such case; then, and in
such case, the party that would otherwise be required to indemnify under Section
4.1(f) will contribute to the aggregate losses, claims, damages or liabilities
to which the other parties may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the parties
in connection with the losses suffered, as well as any other relevant equitable
considerations.
(g) The parties agree that if the Company becomes eligible to
register securities for resale on Form S-3 it may choose to register the Shares
for resale on Form S-3 and, after the SEC declares such Form S-3 registration
statement effective, so notify the Investor, provide all relevant deliverables
(such as a supply of new prospectuses), and then deregister the Shares from the
original Form S-1 Registration Statement. Thereafter such Form S-3 Registration
Statement shall, for all purposes of this Agreement, be deemed to be the
"Registration Statement."
4.2 Deliverables Upon Effectiveness. When and if the SEC declares the
-------------------------------
Registration Statement effective, the Company shall promptly deliver to the
Investor:
14
<PAGE>
(a) A certificate signed by the President of the Company and
that the Registration Statement is effective and, to his knowledge, no stop
order with respect to the Registration Statement has been issued and no
proceedings therefor have been instituted.
(b) A legal opinion of Brobeck, Phleger & Harrison LLP, counsel
to the Company, in substantially the form of Exhibit B.
(c) Such number of copies of the Registration Statement and
(from time to time) of each amendment and supplement thereto, such number of
copies of the prospectus (including (from time to time) any supplemental or
amended prospectus) included in such Registration Statement, and such other
related documents as the Investor may reasonably request in writing in order to
facilitate the disposition of the Shares by the Investor.
4.3 Current Public Information. As long as the Investor owns any
--------------------------
Shares, the Company shall use its best efforts to properly file all SEC Reports,
or otherwise make available "adequate current public information" about itself,
within the meaning of Rule 144(c) under the Securities Act, to potentially make
available to the Investor the benefits of certain rules and regulations of the
SEC which may permit the sale of the Shares without registration.
4.4 Rights Plan. The Company shall use its reasonable best efforts to
-----------
amend, within 30 days after the Closing, its Amended and Restated Stockholder
Rights Plan and all related documents and instruments so that the Investor would
not be deemed an "Acquiring Person" under such Rights Plan unless and until it
has acquired and holds more than 19.99% of the Company's then-outstanding Common
Stock.
5. Conditions of the Investor's Obligations at Closing. The obligations of
---------------------------------------------------
the Investor under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Investor:
15
<PAGE>
5.1 Bringdown. The Company's representations and warranties in
---------
Section 2 shall be true in all material respects, as if made on and as of the
date of the Closing. The Company shall have performed or fulfilled in all
material respects all agreements, obligations and conditions contained herein
required to be performed or fulfilled by the Company before such Closing.
5.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
5.3 Compliance Certificate. The Company shall have delivered to the
----------------------
Investor a certificate dated as of the date of the Closing signed by the Chief
Executive Officer or President of the Company certifying that, to his knowledge,
the conditions set forth in Sections 5.1, 5.2, 5.5, 5.6, and 5.7 have been
satisfied.
5.4 Opinion of Counsel. There shall have been delivered to the
------------------
Investor an opinion of Brobeck, Phleger & Harrison LLP, counsel to the Company,
in substantially the form of Exhibit A.
5.5 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
5.6 No Material Litigation. During the period from the date of this
----------------------
Agreement to the Closing, no material litigation shall have been initiated
challenging the Company's ownership or its right to use or distribute the core
technology of the Company's products, and the Company shall have not received
any written threat of such litigation or any written claim so challenging the
Company's rights.
16
<PAGE>
5.7 No Fraud or Malfeasance. During the period from the date of this
-----------------------
Agreement to the Closing, (a) none of the Company's officers or directors shall
have been removed for fraud or malfeasance in performance of his or her duties
with respect to the affairs of the Company and (b) no new legal proceedings
against any officers or directors of the Company for fraud or malfeasance in the
performance of his or her duties with respect to the affairs of the Company
shall have been instituted by the Company or its stockholders.
6. Conditions of the Company's Obligations at Closing. The obligations of
--------------------------------------------------
the Company under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Company:
6.1 Bringdown. The Investor's representations and warranties in
---------
Section 3 shall be true in all material respects, as if made on and as of the
date of the Closing.
6.2 Blue Sky Compliance. The Company shall be exempt from or have
-------------------
complied with the registration/qualification requirements of and be effective
under all blue sky laws applicable to the offer and sale of the Shares to the
Investor.
6.3 No Order Pending. There shall not then be in effect any order
----------------
enjoining or restraining the transactions contemplated by this Agreement.
7. Miscellaneous.
-------------
7.1 Entire Agreement; Successors and Assigns. This Agreement
----------------------------------------
constitutes the entire contract between the Company and the Investor relative to
the subject matter hereof. Any previous or contemporaneous agreements,
understandings, promises and representations (whether written or oral) with
regard to such subject between the Company and the Investor are superseded by
this Agreement.
17
<PAGE>
7.2 Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the State of California applicable to contracts
entered into and wholly to be performed within the State of California by
California residents.
7.3 Counterparts. This Agreement may be executed in counterparts,
------------
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
7.4 Headings. The headings of the Sections and subsections of this
--------
Agreement are for convenience and shall not determine the interpretation of this
Agreement.
7.5 Notices. Any notice required or permitted hereunder shall be
-------
given in writing and shall be conclusively deemed effectively given upon
personal delivery, or, if made by registered or certified United States mail,
postage prepaid, four business days after mailing, or if made by overnight
carrier, one business day after sending, in all instances addressed (i) if to
the Company, as set forth below the Company's name on the signature page of this
Agreement, and (ii) if to the Investor, as set forth below the Investor's name
on the signature page to this Agreement, or at such other address as the Company
or the Investor may designate by ten days' advance written notice to the
Investor or the Company, respectively.
7.6 Survival of Warranties. The representations and warranties of the
----------------------
parties contained in or made pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the Closing for three years;
provided, however, that such representations and warranties need only be
accurate as of the date of such execution and delivery.
7.7 Amendment of Agreement. Any provision of this Agreement may be
----------------------
modified or amended, at any time, by a written instrument signed by the Company
and by the Investor, and not in any other way.
18
<PAGE>
7.8 Fees and Expenses. The Company and the Investor will each bear
-----------------
their own fees and expenses in connection with the transactions contemplated by
this Agreement.
7.9 Finders' Fees. The Company will hold the Investor harmless from
-------------
all finders' or brokers' fees in connection with the sale of the Shares to the
Investor.
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
PIPES Purchase Agreement as of the day and year first above written.
P-COM, INC., a Delaware corporation
By: /s/ George P. Roberts
___________________________________
Title: Chief Executive Officer
___________________________________
Address: 3175 S. Winchester Boulevard
Campbell, CA 95008
Attention: Chief Financial Officer
STATE OF WISCONSIN INVESTMENT
BOARD, a Wisconsin state agency
By: /s/ John F. Nelson
------------------------------------
Title: Investment Director
------------------------------------
Address: 121 East Wilson Street
P.O. Box 7842
Madison, WI 53707
19
<PAGE>
EXHIBIT A
June 22, 1999
State of Wisconsin Investment Board
P.O. Box 7842
Madison, Wisconsin 53707
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of shares of its
common stock, par value $.0001 per share, pursuant to the Common Stock PIPES
Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement") between
the Company and you. This opinion letter is being rendered to you pursuant to
Section 5.4 of the Stock Purchase Agreement in connection with the Closing of
the sale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In connection with the opinions expressed herein, we have made such
examination of matters of law and of fact as we considered appropriate or
advisable for purposes hereof. As to matters of fact material to the opinions
expressed herein, we have relied upon the representations and warranties as to
factual matters contained in and made by the Company pursuant to the Stock
Purchase Agreement and upon certificates and statements of government officials
and of officers of the Company. We have also examined originals or copies of
such corporate documents or records of the Company as we have considered
appropriate for the opinions expressed herein. We have assumed for the purposes
of this opinion letter the genuineness of all signatures, the legal capacity of
natural persons, the authenticity of the documents submitted to us as originals,
the conformity to the original documents of all documents submitted to us as
certified, facsimile or photostatic copies, and the authenticity of the
originals of such copies.
In rendering this opinion letter we have also assumed: (A) that the Stock
Purchase Agreement has been duly and validly executed and delivered by you or on
your behalf, that you have the power to enter into and perform all your
obligations thereunder, and that the Stock Purchase Agreement constitutes a
valid, legal, binding and enforceable obligation upon you; (B) that the
representations and warranties made in the Stock Purchase Agreement by you are
true and correct; and (C) that any wire transfers, drafts or checks tendered by
you will be honored.
As used in this opinion letter, the expression "we are not aware" or the
phrase "to our knowledge", or any similar expression or phrase with respect to
our knowledge of matters of fact, means as to matters of fact that, based on the
actual knowledge of individual attorneys within the firm principally responsible
for handling current matters for the Company (and not including any constructive
or imputed notice of any information), and after an examination of documents
referred to herein and after inquiries of certain officers of the Company, no
facts have been disclosed to us that have caused us to conclude that the
opinions expressed are factually
<PAGE>
incorrect; but beyond that we have made no factual investigation for the
purposes of rendering this opinion letter. Specifically, but without limitation,
we have not searched the dockets of any courts and we have made no inquiries of
securities holders or employees of the Company, other than such officers.
This opinion letter relates solely to the laws of the State of California,
the General Corporation Law of the State of Delaware and the federal law of the
United States and we express no opinion with respect to the effect or
application of any other laws. Special rulings of authorities administering
such laws or opinions of other counsel have not been sought or obtained.
Based upon our examination of and reliance upon the foregoing and subject
to the limitations, exceptions, qualifications and assumptions set forth below
and except as set forth in the Stock Purchase Agreement or the Disclosure
Schedule thereto, we are of the opinion that as of the date hereof:
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, and the Company has
the requisite corporate power and authority to own its properties and to conduct
its business as, to our knowledge, it is presently conducted. The Company is
qualified to do business as a foreign corporation in the state of California.
2. The Company has the requisite corporate power and authority to
execute, deliver and perform the Stock Purchase Agreement. The Stock Purchase
Agreement has been duly and validly authorized by the Company, duly executed and
delivered by an authorized officer of the Company and constitutes a legal, valid
and binding obligation of the Company, enforceable by you against the Company in
accordance with its terms.
3. The Shares have been duly authorized and, upon purchase at the Closing
pursuant to the terms of the Stock Purchase Agreement, will be validly issued,
nonassessable and fully paid, and free of any liens created by the Company.
4. The Company's execution and delivery of, and its performance and
compliance as of the date hereof with the terms of, the Stock Purchase Agreement
do not violate any provision of any federal, Delaware corporate or California
law, rule or regulation applicable to the Company or any provision of the
Company's Restated Certificate of Incorporation or Bylaws and do not conflict
with or constitute a default under the provisions of any judgment, writ, decree
or order specifically identified in the SEC Reports or the material provisions
of any of the material agreements specifically identified in the SEC Reports.
5. Other than in connection with any securities laws, all consents,
approvals, permits, orders or authorizations of, and all qualifications by and
registrations with, any federal or Delaware corporate or California state
governmental authority on the part of the Company required in connection with
the execution and delivery of the Stock Purchase Agreement and consummation at
the Closing of the transactions contemplated by the Stock Purchase Agreement
A-2
<PAGE>
have been obtained, and are effective, and we are not aware of any proceedings,
or written threat of any proceedings, that question the validity thereof.
6. Based in part upon the representations of you in the Stock Purchase
Agreement, the offer and sale of the Shares to you pursuant to the terms of the
Stock Purchase Agreement are exempt from the registration requirements of
Section 5 of the Securities Act of 1933, as amended, and from the qualification
requirements of the California Corporate Securities Law of 1968, as amended.
Our opinions expressed above are specifically subject to the following
limitations, exceptions, qualifications and assumptions:
(A) The legality, validity, binding nature and enforceability of the
Company's obligations under the Stock Purchase Agreement may be subject to or
limited by (1) bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent transfer and other similar laws affecting the rights of creditors
generally; (2) general principles of equity (whether relief is sought in a
proceeding at law or in equity), including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the discretion of
any court of competent jurisdiction in awarding specific performance or
injunctive relief and other equitable remedies; and (3), without limiting the
generality of the foregoing, the effect of California court decisions and
statutes which indicate that provisions of the Stock Purchase Agreement which
permit you to take action or make determinations may be subject to a requirement
that such action be taken or such determinations be made on a reasonable basis
in good faith or that it be shown that such action is reasonably necessary for
your protection.
(B) We express no opinion as to the Company's compliance or noncompliance
with applicable federal or state antifraud or antitrust statutes, laws, rules
and regulations.
(C) We express no opinion concerning the past, present or future fair
market value of any securities.
(D) We express no opinion as to the enforceability under certain
circumstances of any provisions indemnifying a party against, or requiring
contributions toward, that party's liability for its own wrongful or negligent
acts, or where indemnification or contribution is contrary to public policy or
prohibited by law. In this regard, we advise you that in the opinion of the
Securities and Exchange Commission, indemnification of directors, officers and
controlling persons of an issuer against liabilities arising under the
Securities Act of 1933, as amended, is against public policy and is therefore
unenforceable.
(E) We express no opinion as to the enforceability under certain
circumstances of any provisions prohibiting waivers of any terms of the Stock
Purchase Agreement other than in writing, or prohibiting oral modifications
thereof or modification by course of dealing. In addition, our opinions are
subject to the effect of judicial decisions which may permit the introduction of
extrinsic evidence to interpret the terms of written contracts.
A-3
<PAGE>
(F) We express no opinion as to the effect of Section 1670.5 of the
California Civil Code or any other California law, federal law or equitable
principle which provides that a court may refuse to enforce, or may limit the
application of, a contract or any clause thereof which the court finds to have
been unconscionable at the time it was made or contrary to public policy.
(G) We express no opinion as to your compliance with any Federal or state
law relating to your legal or regulatory status.
(H) We express no opinion as to the compliance of the Company, the
Investor or the sale of the Common Stock to the Investor with the provisions of
the Small Business Investment Act of 1958, as amended, or any of the regulations
promulgated thereunder.
(I) We express no opinion as to the effect of subsequent issuances of
securities of the Company, to the extent that further issuances which may be
integrated with the Closing may include purchasers that do not meet the
definition of "accredited investors" under Rule 501 of Regulation D and
equivalent definitions under state securities or "blue sky" laws.
(J) We express no opinion as to Section 7.2 of the Stock Purchase
Agreement to the extent that it purports to exclude conflict of law principles
under California law.
(K) With your permission, we express no opinion regarding the Hart-Scott-
Rodino Antitrust Improvements Act of 1976.
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and may not be
delivered to, quoted or relied upon by any person other than you, or for any
other purpose, without our prior written consent. Our opinion is expressly
limited to the matters set forth above and we render no opinion, whether by
implication or otherwise, as to any other matters relating to the Company or the
Shares. We assume no obligation to advise you of facts, circumstances, events
or developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
A-4
<PAGE>
EXHIBIT B
_____________, 1999
State of Wisconsin Investment Board
P.O. Box 7842
Madison, Wisconsin 53707
Ladies and Gentlemen:
We have acted as counsel for P-Com, Inc., a Delaware corporation (the
"Company"), in connection with the issuance and sale to you of certain Shares of
its common stock, par value $.0001 per share, pursuant to the Common Stock
PIPES Purchase Agreement dated June 21, 1999 (the "Stock Purchase Agreement")
between the Company and you and in connection with the Company's registration
with the SEC of such Shares for resale by you. This opinion letter is being
rendered to you pursuant to Section 4.2(b) of the Stock Purchase Agreement in
connection with the SEC declaring effective the Registration Statement for your
resale of the Shares. Capitalized terms not otherwise defined in this opinion
letter have the meanings given them in the Stock Purchase Agreement.
In our capacity as counsel to the Company, we have examined, among other
things, originals, or copies identified to our satisfaction as being true
copies, of the Registration Statement on Form S-1 (File No. 333-____________)
initially filed by the Company with the SEC on ____________, 1999, for the
purpose of registering the resale of the Shares under the Securities Act;
Amendment No. 1 to such Registration Statement filed with the SEC on
_____________, 1999; Amendment No. 2 to such Registration Statement filed with
the SEC on _____________, 1999; and oral advice on ______________, 1999, from an
SEC staff examiner, that the SEC had declared such Registration Statement, as so
amended, effective as of ______ p.m., Washington, D.C. time, on _____________,
1999.
As used in this opinion letter, the phrase "to our knowledge" means as to
matters of fact that, based on the actual knowledge of individual attorneys
within the firm principally responsible for handling current matters for the
Company (and not including any constructive or imputed notice of any
information), no facts have been disclosed to us that have caused us to conclude
that the opinions expressed are factually incorrect; but our affirmative factual
investigation for the purpose of rendering this opinion letter has been limited
to obtaining (a) oral advice received on ___________, from an SEC staff
examiner, that the SEC had declared such Registration Statement, as amended,
effective at _____ p.m. Washington, D.C. time, on _________ , 1999 and (b) oral
advice received on ___________, 1999 from an SEC staff examiner that there is no
stop order suspending the effectiveness of the Registration Statement.
Based upon our examination of and reliance upon the foregoing, we are of
the opinion that as of the date hereof:
1. The Registration Statement has become effective under the Securities
Act and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose are
pending before or contemplated by the SEC.
<PAGE>
This opinion letter is rendered as of the date first written above solely
for your benefit in connection with the Stock Purchase Agreement and the
Registration Statement and may not be delivered to, quoted or relied upon by any
person other than you, or for any other purpose, without our prior written
consent. Our opinion is expressly limited to the matters set forth above and we
render no opinion, whether by implication or otherwise, as to any other matters
relating to the Company, the Stock Purchase Agreement, the Registration
Statement or the Shares. We assume no obligation to advise you of facts,
circumstances, events or developments which hereafter may be brought to our
attention and which may alter, affect or modify the opinions expressed herein.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
B-2
<PAGE>
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
Page 1 of 2
COMPANY CONTACTS:
Bob Collins, Vice President & Chief Financial Officer
P-COM, INC. ENTERS INTO AGREEMENTS FOR $40 MILLION
OF NEW EQUITY INVESTMENTS
- --------------------------------------------------------------------------------
CAMPBELL, CA - June 21, 1999 - P-Com, Inc. (NASDAQ National Market: PCMS)
announced today that it has entered into seven separate agreements to sell a
total of 10,067,958 shares of newly issued common stock for an aggregate of $40
million. The Company priced the shares at a 7.5% discount to the 15-day average
of its closing sale prices for the period ended June 17, 1999, the day P-Com's
Board of Directors approved the transaction. These transactions are scheduled
to close on June 22, 1999.
The State of Wisconsin Investment Board is the lead investor, acquiring
5,033,979 additional shares of common stock for $20 million. This, together
with previous open market purchases, increases the State of Wisconsin Investment
Board's investment in P-Com from approximately 6% of the total outstanding
shares of the Company's common stock at December 31, 1998 to approximately 13.5%
today.
"The State of Wisconsin Investment Board is pleased to lead this investment
in P-Com's people and products," said John Nelson, the State of Wisconsin
Investment Board's Investment Director of Small Company Stocks. "The potential
opportunity for all of us as partners going forward looks tremendous."
The Kaufmann Fund, Baystar Capital, L.P. and investors led by Gruber
McBaine Capital Management agreed to invest $10 million, $7.5 million and $2.5
million, respectively, for 2,516,990, 1,887,742 and 629,247 shares of common
stock, respectively.
PaineWebber Incorporated served as the Company's placement agent on these
transactions. The Company also agreed with the seven investors to register their
newly purchased shares with the SEC for resale.
"These funds will enable the Company to aggressively launch the production
effort for our new point-to-multipoint broadband access product line," said
George P. Roberts, the Company's Chairman of the Board and Chief Executive
Officer.
--more--
<PAGE>
P-COM, INC., ENTERS INTO AGREEMENTS FOR $40 MILLION
- --------------------------------------------------------------------------------
Page 2 of 2
P-Com, Inc. develops, manufactures, and markets network access systems for
the worldwide wireless telecommunications market. The point-to-point, spread
spectrum, and point-to-multipoint radio links provided by P-Com are designed to
satisfy the network requirements of cellular and personal communications
services, corporate communications, public utilities and local governments. In
addition, P-Com provides comprehensive network services including system
planning, program planning and management, path design, and installation.
Statements in this release that are forward looking involve known and
unknown risks and uncertainties, which may cause the Company's actual results in
future periods to be materially different from any future performance that may
be suggested in this release. Such factors may include, but are not limited to,
reliance upon subcontractors, fluctuations in customer demand and commitments,
both in timing and volume, introduction of new products, commercial acceptance
and viability of new products and expenses associated therewith, cancellations
of orders without penalties, pricing and competition, the Company's ability to
have available an appropriate amount of production capacity in a timely manner,
the ability of the Company's customers to finance their purchases of the
Company's products and/or services, the timing of new technology and product
introductions, the risk of early obsolescence, and the pending stockholder class
action lawsuits. Further, the Company operates in an industry sector where
securities values are highly volatile and may be influenced by economic and
other factors beyond the Company's control, such as announcements by competitors
and service providers. Reference is made to the discussion of risk factors
detailed in the Company's filings with the Securities and Exchange Commission,
including its reports on Form 10-K and 10-Q.
P-Com, Inc., with world headquarters in Campbell, California, USA and
offices in Florida, New Jersey, Virginia, the UK, Italy, France, Germany,
Poland, Mexico, Dubai and China, is an ISO 9001 certified company. For
additional information, contact P-Com at:
P-Com, Inc. . 3175 S. Winchester Boulevard . Campbell, CA 95008 . USA
TEL: (408) 866-3666 . FAX: (408) 866-3655
www.p-com.com
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