<PAGE>
PROSPECTUS Filed Pursuant to Rule 424(b)(4)
---------- File No. 333-47190
8,888,591 Shares
P-COM, INC.
-------------
COMMON STOCK
-------------
The stockholders of P-Com, Inc. listed on page 2 below are offering
for resale and selling under this prospectus up to 9,000,000 shares of our
common stock.
Our common stock is traded on the Nasdaq National Market (Nasdaq
Symbol: PCOM). On October 12, 2000, the closing price of the common stock was
$5.0625 per share.
-------------
You should carefully consider the risk factors commencing on page 3
before purchasing any of the common stock offered by the selling stockholders.
-------------
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these securities or passed
upon the adequacy or accuracy of this prospectus. Any representation to the
contrary is a criminal offense.
-------------
The date of this prospectus is October 13, 2000.
The information in this prospectus is not complete and may be changed.
The selling stockholders may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
1
<PAGE>
SUMMARY
The common stock to be resold by the selling stockholders pursuant to
this prospectus was issued by us to the selling stockholders in a private
placement closed on January 13, 2000 or is issuable to the selling stockholders
upon the exercise of warrants which we granted them, as required by the terms of
such private placement. The name of each selling stockholder and the number of
shares of common stock to be registered for resale under this registration
statement are set forth in the following table.
Number of
Shares of
Common
Number of Shares Stock
of Outstanding Underlying
Name of Selling Stockholder Common Stock Warrants Total
--------------------------- ---------------- ---------- -----
Whitman Partners, L.P. 2,626,970 473,702 3,100,672
Seligman Communications and Information 2,626,970 473,702 3,100,672
Fund, Inc.
Lagunitas Partners L.P. 525,394 94,741 620,135
Quissett Partners, L.P. 457,092 82,424 539,516
Quissett Investors (Bermuda) L.P. 304,728 54,950 359,678
Weber Capital Partners, L.P. 262,697 47,371 310,068
Gruber McBaine International 218,914 39,476 258,390
Lion Investments Ltd. 131,348 23,685 155,033
Westpool Investment Trust 131,348 23,685 155,033
Vanguard Explorer Fund 87,565 15,790 103,355
Lockheed Martin Corp. Master Retirement 87,565 15,790 103,355
Trust
Trustees of Hamilton College 43,782 7,895 51,677
Hazelbrook Partners, L.P. 26,269 4,738 31,007
We develop, manufacture and market systems for the transport of voice
and data between the end user and a location where the information is
transferred onto the broader telecommunications network. Our systems are sold to
the worldwide wireless telecommunications market. Our systems are designed to
satisfy the network requirements of cellular telephone service providers and
digital wireless communications service providers, corporate communications,
public utilities and local governments. We also provide comprehensive network
services to assist customers in designing, building and optimizing the
performance of their wireless communications networks. Our radio systems are
sold internationally through strategic partners, providers of bundled consulting
services and telecommunications equipment manufacturers who resell our products
under their brand names, distributors and directly to end-users. Our executive
offices are located at 3175 S. Winchester Boulevard, Campbell, California 95008,
and our telephone number is (408) 866-3666.
2
<PAGE>
RISK FACTORS
You should carefully consider the risks described below before making
an investment decision.
Due to our stage of development and industry, an investment in our stock is very
risky
We do not have the customer base or other resources of more
established companies, which makes it more difficult for us to address
the liquidity and other challenges we face
We have not developed a large installed base of our equipment or the
kind of close relationships with a broad base of customers of a type enjoyed by
older, more developed companies, which would provide a base of financial
performance from which to launch strategic initiatives and withstand business
reversals. In addition, we have not built up the level of capital often enjoyed
by more established companies, so from time to time we may face serious
challenges in financing our continued operation. We may not be able to
successfully address these risks, which would adversely affect our results of
operations and, ultimately, our stock price.
Our stock price is volatile, so you may not be able to sell our stock
at any particular time at a favorable price
The stock market in general, and the market for shares of small
capitalization and technology stocks in particular, have experienced extreme
price fluctuations in recent years. These fluctuations have often been unrelated
to the operating performance of affected companies. The market price of our
common stock may continue to decline substantially, or otherwise continue to
experience significant fluctuations in the future, sometimes reaching extreme
and unexpected lows, including fluctuations that are unrelated to our
performance. During the 52 week period ending October 12, 2000, the market price
of a share of our common stock was as low as $4.125 and as high as $28.50. These
fluctuations may mean that investors may not be able to sell our common stock at
a favorable price at any given time.
We do not pay dividends, so appreciation of our stock price is the
only way in which you will realize a return on your investment
Our bank line-of-credit agreement prohibits us from paying any
dividends on our common stock except dividends paid in shares of our common
stock. Since our incorporation in 1991, we have not declared or paid cash
dividends on our common stock, and we anticipate that any future earnings will
be retained for investment in our business. Thus, the return on an investment in
our common stock will likely be through resale of shares at a price higher than
the price paid for those shares. As indicated above, the market for our shares
may not provide an opportunity to sell our shares at a favorable price at any
given time.
3
<PAGE>
We rely on our existing customers, and it will materially adversely affect our
operating results and financial condition if they do not support us
A substantial amount of our products and services are purchased by a
limited number of customers, so the loss of a large customer would
significantly affect our results of operations
If any of our important customers significantly reduce their purchases
from us, which has been the case during the last twelve months, then this may
materially adversely affect the profitability of our business and our ability to
remain in business. During 1998 and 1999, one customer, Orange Personal
Communications Ltd., accounted for 27.9% and 20%, respectively, of our sales.
During the second quarter of 2000, we had four different customers that
individually accounted for over 10% of our sales. During the second quarter of
2000, two customers, Lucent and Winstar, accounted for 20.0% and 19.5%,
respectively, of our sales.
The Company places orders with suppliers based in part on customer
non-binding forecasts
Historically, the Company has built products based on non-binding
forecasts from customers. This practice has resulted in write-offs of excessive
and obsolete inventory for each of the past three years.
Our customers may cancel orders leaving us with unsaleable equipment
or idle capacity
Our customers often enter into purchase orders with us far in advance
of manufacture of the equipment ordered. We have experienced purchase order
cancellations and deferrals. Historically, we have chosen not to harm our
relationships with our customers by enforcing their obligations under purchase
orders when the customer wishes to cancel an order. Cancellations of orders by
customers may, depending upon the timing of the cancellation, leave us with
unsaleable equipment or idle capacity, which would adversely affect our
operating results and financial condition.
We may be unable to obtain additional capital needed to operate and grow our
business, which could damage our financial condition and further erode our stock
price
Our future capital requirements will depend upon many factors,
including development of new products and related software tools, potential
acquisitions, maintenance of adequate manufacturing facilities and contract
manufacturing agreements, progress of research and development efforts,
expansion of marketing and sales efforts, and status of competitive products.
Additional financing may not be available in the future on acceptable terms or
at all. The continued existence of a substantial amount of debt could also
severely limit our ability to raise additional financing. In addition, given the
recent price for our common stock, if we raise additional funds by issuing
equity securities, significant dilution to our stockholders could result.
If adequate funds are not available, we may be required to restructure
or refinance our debt or delay, scale back or eliminate our research and
development, acquisition or manufacturing programs. We may also need to obtain
funds through arrangements with partners
4
<PAGE>
or others that may require us to relinquish rights to certain of our
technologies or potential products or other assets. Our inability to obtain
capital, or our ability to obtain additional capital only upon onerous terms,
could very seriously damage our business, operating results and financial
condition and further erode our stock price.
The common stock sold in this offering will increase the supply of our common
stock on the public market, which may cause our stock price to decline
The sale into the public market of the common stock issued in the
January 13, 2000 private placement and upon issuance of the warrants could
materially adversely affect the market price of our common stock. Most of the
shares of our common stock are eligible for immediate and unrestricted sale in
the public market at any time. Once the registration statement of which this
prospectus forms a part is declared effective, all shares of common stock issued
in the January 13, 2000 private placement and upon issuance of the warrants will
be eligible for immediate and unrestricted resale into the public market.
Because the exercise price of the warrants is below the current market price of
our common stock, the sale of the common stock issued upon exercise of the
warrants will be dilutive to our stockholders. The presence of these additional
shares of common stock in the public market may further depress our stock price.
We may try to issue stock at a discount to the current market price, which would
dilute our existing stockholders
In order to raise the funds we need to execute our business plan and
fund operations generally, we may continue to issue stock at a discount to the
current market price. Transactions of that kind would result in dilution to our
existing stockholders.
We may be forced to incur additional costs to restructure our business to reduce
our expenses, which could materially adversely affect our results of operations
and stock price
During 1999, we generated net losses of approximately $103.0 million.
During the first six months of 2000, we generated net losses of $68.0 million.
We may also incur net losses in future periods. In response to market declines
and poor performance in our sector generally and our lower than expected
performance over the last several quarters, we introduced measures to reduce
operating expenses. These measures included reductions in our workforce in 1999
and 1998. Additionally, management continues to evaluate market conditions to
assess the need to take further action to more closely align our cost structure
with anticipated revenues. Any subsequent actions could result in additional
restructuring charges, reductions of inventory valuations and provisions for the
impairment of long-lived assets, which could materially adversely affect our
results of operations and stock price.
When our large fixed costs combine with significant fluctuations in our sales,
large fluctuations in our results of operations may occur which could adversely
affect our stock price
A material portion of our expenses are fixed and difficult to reduce,
which magnifies the effects of any revenue shortfall. In addition, to prepare
for the future, we may continue to heavily invest resources in:
5
<PAGE>
. the development of new products and technologies,
. the evaluation of these products,
. expansion into new geographic markets, and
. our plant and equipment, inventory, personnel and other items, in
order to efficiently produce these products and to provide
necessary marketing and administrative service and support.
As such, in addition to our fixed costs, our expenses will be increased by
start-up costs associated with the initial production and installation of new
products and technologies.
We experience significant fluctuations in sales, gross margins and
operating results. Our results of operations have also been and will continue to
be influenced by competitive factors, including pricing, availability and demand
for competitive products and services. These factors are difficult for us to
forecast, and have materially adversely affected our results of operations and
financial condition and may continue to do so. Because of our inability to
predict customer orders, delays, deferrals and cancellations, we may not be able
to achieve or maintain our current sales levels. We believe that period-to-
period comparisons are thus not necessarily meaningful and should not be relied
upon as indications of future performance. Because of all of the foregoing
factors, in some future quarter or quarters, revenues will be lower than
expected and our operating results and financial condition will be materially
adversely affected. In addition, to the extent our results of operations are
below those projected by public market analysts, the price of our common stock
may continue to be materially adversely affected by this discrepancy.
We may be unable to become profitable if the selling prices of our products and
services decline over time
We believe that average selling prices and possibly gross margins for
our systems and services will decline over time. If we are unable to offset
declining average selling prices by comparable cost savings, our gross margins
will decline, and our results of operations and financial condition would be
adversely affected. Reasons for the decline in average selling prices include
the maturation of our systems, the effect of volume price discounts in existing
and future contracts and the intensification of competition. To offset declining
average selling prices, we believe we must take a number of steps, including:
. successfully introducing and selling new systems on a timely basis;
. developing new products that incorporate advanced software and
other features that can be sold at higher average selling prices;
and
. reducing the costs of our systems through contract manufacturing,
design improvements and component cost reduction, among other
actions.
If we cannot develop new products in a timely manner, or if our new
products fail to achieve customer acceptance or do not generate higher average
selling prices, then we would be unable to offset declining average selling
prices.
6
<PAGE>
We depend on contract manufacturers and limited sources of supply and, if they
fail us, production delays could damage our customer relationships
Our internal manufacturing capacity is very limited, and certain
components, subassemblies and services necessary for the manufacture and
production of our systems are obtained from a sole supplier or a small group of
suppliers. As a result, we have reduced control over the price, timely delivery,
reliability and quality of finished products, components and subassemblies. We
have experienced problems in the timely delivery and quantity of products and
certain components and subassemblies from vendors. We expect to rely
increasingly on these contract manufacturers and outside vendors in the future,
and they may prove undependable, stop doing business with us, or go out of
business. Due to the complexity of our products, finding and educating
additional or replacement vendors may be expensive and take considerable time.
Our internal manufacturing capacity and that of our contract manufacturers may
be insufficient to fulfill our orders, and we may be unable to obtain timely
deliveries of components and subassemblies of acceptable quality. Our failure to
manufacture, assemble and ship systems and meet customer demands on a timely and
cost-effective basis could damage relationships with customers and our business.
If we are successful in growing our business, we may be unable to manage and
integrate the expanded operations associated with revenue growth, which may
increase costs and hurt profitability
Our prior expansion has strained and continues to strain our
management, financial resources, manufacturing capacity and other resources and
has disrupted our normal business operations. Our ability to manage any possible
future growth may depend upon significant expansion of our manufacturing,
accounting and other internal management systems and the implementation of a
variety of systems, procedures and controls, all of which would involve
expenditures in advance of increased sales. In particular, if our business
grows, we must successfully manage overhead expenses and inventories, develop,
introduce and market new products, manage and train our employee base, integrate
and coordinate our geographically and ethnically diverse workforce and the
monitor third party manufacturers and suppliers. We have in the past experienced
and may continue to experience significant problems in these areas.
If our business grows, any failure to efficiently coordinate and
improve systems, procedures and controls, including improved inventory control
and coordination with our subsidiaries, could cause continued inefficiencies,
additional operational complexities and expenses, greater risk of billing
delays, inventory write-downs and financial reporting difficulties. Those
problems could impact our profitability and our ability to effectively manage
our business.
We may have difficulty managing the businesses we have acquired, which
may increase our costs and divert resources from our business. We may continue
to encounter problems related to the management of companies which we have
acquired over the past several years. Overcoming existing and potential problems
may entail increased costs, additional investment and diversion of management
attention and other resources, or require divestment of one or more business
units, which may adversely affect our business, financial condition and
operating results. In this regard, in the first six months of 2000, we sold
three business units,
7
<PAGE>
Technosystem, Cemetel S.r.l., and Control Resources Corporation (CRC), which
primarily represented non-core business products, such as broadcast equipment
and network monitoring equipment. The negative impact on the financial
statements of the disposal of Technosystem was $30.9 million. The impact on our
future financial statements of the divestitures of Cemetel S.r.l. and CRC is not
expected to be material. In addition, we have written off assets of several of
our other acquired companies including write-offs of $15 million of Cylink
Wireless Group goodwill in the second quarter of 2000.
Accounting charges related to acquisitions may decrease future earnings
Many business acquisitions must be accounted for as purchase business
combinations for financial reporting purposes. All of our past acquisitions,
except the acquisitions of Control Resources Corporation, RT Masts Limited and
Telematics, Inc., have been accounted for as purchase business combinations,
resulting in a significant amount of goodwill being amortized. Amortization
expenses adversely affect our financial results.
If our results of operations are inadequate, we may have difficulty servicing
our debt, which could cause a default and acceleration of repayment of
our debts
As of June 30, 2000, our total indebtedness including current
liabilities was approximately $112.7 million and our stockholders' equity was
approximately $77.2 million. Our ability to make scheduled payments of the
principal and interest on our indebtedness will depend on our future
performance, which is subject in part to economic, financial, competitive and
other factors beyond our control. We may be unable to make payments on or
restructure or refinance our debt in the future, if necessary, which could lead
to a default under our credit agreement and note indenture and acceleration of
repayments of the debts thereunder.
Our customers may not pay us on time, leaving us short of funds needed to
operate our business
We may be unable to enforce a policy of receiving payment within a
limited number of days of issuing bills. We have had difficulties in the past in
receiving payment in accordance with our policies, particularly from customers
in the early phases of business development which are awaiting financing to fund
their expansion and from customers outside of the United States. We may not be
able to locate parties to purchase our receivables on acceptable terms or at
all. Any inability to timely collect or sell our receivables could cause us to
be short of cash to fund operations and could have a material adverse effect on
our business, financial condition and results of operations.
We may experience problems with product quality, performance and reliability,
which may damage our customer relationships
We have limited experience in producing and manufacturing systems and
contracting for this manufacture. Our customers also require very demanding
specifications for quality, performance and reliability. As a consequence,
problems may occur with respect to the specifications for our systems or related
software tools. If those problems occur, we could experience increased costs,
delays, cancellations or reschedulings of orders or shipments, delays in
collections of accounts receivable and product returns and discounts. In
addition, the failure
8
<PAGE>
of any of our facilities to maintain or attain quality certification by the
International Standards Organization could adversely affect our sales and sales
growth. If any of these events occur, they might erode customer confidence and
cause them to reduce their purchases from us, which would adversely impact our
business and results of operations.
The market for our products may not grow fast enough to support our level of
investment, adversely affecting our results of operations
Our future operating results depend upon the continued growth and
increased availability and acceptance of advanced radio-based wireless
telecommunications systems and services in the United States and
internationally. The volume and variety of and the markets for and acceptance of
wireless telecommunications systems and services may not continue to grow as
anticipated. Because these markets are relatively new, predicting which market
segments will develop and at what rate they will grow is difficult. We have
recently invested additional significant time and resources in the development
of new products. If the market for these new products and the market for related
services for our systems fail to grow, or grow more slowly than anticipated,
revenue will also fail to grow, adversely affecting our results of operations .
We may be unable to compete successfully for customers with either competitors
offering technologies similar to ours or with alternative technologies, which
could adversely affect our business and results of operations
Our wireless-based radio systems compete with other wireless
telecommunications products and alternative telecommunications transmission
media, including copper and fiber optic cable. We are experiencing intense
competition worldwide from a number of leading telecommunications companies.
Those companies offer a variety of competitive products and services and broader
telecommunications product lines, which makes us more vulnerable to shifts in
technology and customer preferences. Many of these companies have much greater
installed bases, financial resources and production, marketing, manufacturing,
engineering and other capabilities than we do. We face actual and potential
competition not only from these established companies, but also from start-up
companies that are developing and marketing new commercial products and
services.
Two of our primary competitors are Ericsson and DMC Stratex Networks.
Ericsson is a formidable competitor for us because they provide both consulting
services and equipment they manufacture to customers as complete
telecommunications solutions. Ericsson's combined consulting and product
approach insulates them from competition for sales of products because, in order
for customers to obtain the complete solution, Ericsson requires them to
purchase the product from Ericsson, which completely forecloses our opportunity
to sell products to the customer. In contrast, DMC Stratex Networks is a product
manufacturer like us, and competes directly against us for product sales to
customers, which leads to downward pressure on prices we can charge for our
products. With regard to our point-to-multipoint product line, we also compete
with Netro, who is also a product manufacturer like us. If we are unable to
successfully compete for customers, future growth, revenues and profitability
would be adversely affected.
9
<PAGE>
Failure to respond to rapid technological change or introduce new products in a
timely manner may limit our revenue growth and adversely impact our results of
operations
Rapid technological change, frequent new product introductions and
enhancements, product obsolescence, changes in end-user requirements and
evolving industry standards characterize the communications market. Our ability
to compete in this market will depend upon our successful development,
introduction and sale of new systems and enhancements and related software
tools, on a timely and cost-effective basis, in response to changing customer
requirements. We have experienced and continue to experience delays in customer
procurement and in completing development and introduction of new systems and
related software tools, including products acquired in acquisitions. Moreover,
we may not be successful in selecting, developing, manufacturing and marketing
new systems or enhancements or related software tools. Any inability to rapidly
introduce, in a timely manner, new systems, enhancements or related software
tools could have a material adverse effect on our results of operations and
limit future growth.
We have international operations in more volatile markets than the United
States, and changes in these markets may undermine our business there
In doing business in international markets, we face economic,
political, regulatory, logistical, legal, financial and business environments
and foreign currency fluctuations that are more volatile than those commonly
experienced in the United States. Until 2000, most of our sales were made to
customers located outside of the United States. Because of the more volatile
nature of these markets, the basis for our business in these markets may be
frequently jeopardized, materially and adversely affecting our operations in
these countries and our overall results of operations and growth.
We are subject to extensive government regulation, which may change and harm our
business
We operate in a constantly changing regulatory environment. Radio
communications are extensively regulated by the United States government, and we
also are subject to foreign laws and international treaties. Our systems must
conform to a variety of domestic and international requirements established to,
among other things, avoid interference among users of radio frequencies and to
permit interconnection of equipment. Regulatory changes, which are affected by
political, economic and technical factors, could significantly impact our
operations by restricting our development efforts and those of our customers.
Many of our competitors have broader telecommunications product lines, which
makes us more vulnerable than they are to regulatory changes that shift business
from one product to another. As a result, those regulatory changes could make
current systems obsolete, favor our competitors or increase competition. Any of
those regulatory changes, including changes in the allocation of available
spectrum or changes that require us to modify our systems and services, could
prove costly and thus materially adversely affect our business and results of
operations.
10
<PAGE>
We are the subject of, and may be the subject of additional, class action suits,
which would divert significant resources away from our business
We are a defendant in a consolidated class action lawsuit in state
court. An unfavorable outcome could have a material adverse effect on our
prospects and financial condition. Even if the litigation is resolved in our
favor, the defense of that litigation will entail considerable cost and
diversion of efforts of management, either of which are likely to adversely
affect our results of operations.
We may be unable to protect our proprietary rights, permitting competitors to
duplicate our products and services or preventing us from selling our products
We rely on a combination of patents, trademarks, trade secrets,
copyrights and other measures to protect our intellectual property rights.
However, these measures may not provide adequate protection for our trade
secrets or other proprietary information. Any of our patents could be
invalidated, circumvented or challenged, or may not provide competitive
advantages to us. In addition, foreign intellectual property laws may not
adequately protect our intellectual property rights abroad. Any failure or
inability to protect proprietary rights could have a material adverse effect on
our competitive market position and business.
Litigation may also be necessary to enforce our intellectual property
rights, to protect our trade secrets, to determine the validity and scope of
proprietary rights of others or to defend against claims of infringement. A
variety of third parties have sent correspondence to the former owner of the
Cylink Wireless Group in which they allege that the Cylink Wireless Group's
products may be infringing their intellectual property rights. We acquired
Cylink in 1998. Therefore, any intellectual property litigation based upon
those allegations could result in substantial costs and diversion of management
attention and resources, and could prevent us from selling certain products or
require us to license technology to continue selling those products. Licenses
to any of that technology may not be available on acceptable terms or at all.
Our results may suffer if we are unable to attract and retain qualified
management and technical personnel
Our highly technical business depends upon the continued contributions
of key technical and senior management personnel, many of whom would be
difficult to replace. Competition for qualified management, manufacturing,
quality assurance, engineering, marketing, sales and support personnel is
intense in our industry and geographic areas, and we may not be successful in
attracting or retaining those personnel. We experience high employee turnover
which is disruptive and could adversely impact our business. The loss, or
failure to perform, of any key employee could materially adversely affect our
customer relations and results of operations.
11
<PAGE>
Our board has the power to reject offers to acquire shares of our common stock
in a change of control transaction, which may prevent our stockholders from
having the opportunity to accept those offers and discourage certain offers for
shares of our common stock
The following factors give our board of directors the power to reject
acquisition proposals without any input or consideration of these proposals by
our stockholders:
. our stockholder rights agreement,
. our certificate of incorporation and bylaws,
. our equity incentive plans, and
. Delaware law.
As a result of these factors, our board of directors could
significantly delay, defer or prevent a change in control transaction involving
P-Com, even if holders of our common stock might want the transaction to occur.
These factors may adversely affect the voting and other rights of other holders
of common stock, and prevent stockholders from receiving and accepting offers to
acquire their shares that the board deems not to be in the best interest of our
stockholders. In addition, the power of the board to reject those offers may
discourage certain third parties from making these offers.
Relying on forward-looking statements could cause you to incorrectly assess the
risks and uncertainties in investing in our stock because our actual results
could differ materially from those anticipated in forward-looking statements
contained in this prospectus
This prospectus contains "forward-looking" statements that involve
risks and uncertainties. Our actual results could differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including the risks faced by us described above and elsewhere in this
prospectus.
We may face other risks not described in the foregoing risk factors which may
impair our business operations
The risks and uncertainties described in the foregoing risk factors
may not be the only ones facing us. Additional risks and uncertainties not
presently known to us may also impair our business operations. If any of the
following risks actually occur, our business, financial condition and results of
operations could be materially adversely affected. In this case, the trading
price of our common stock could decline, and you may lose all or part of your
investment.
12
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our SEC filings are also available
to the public from our web site at http://www.p-com.com or at the SEC's web site
at http://www.sec.gov.
This prospectus is part of a registration statement (Registration No.
333-47190) we filed with the SEC. The SEC allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus, and later information filed with the SEC will update and supersede
this information.
We incorporate by reference the documents listed below and any future
filings made with the SEC under Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934, as amended, until the selling stockholders sell
all of the shares of common stock being registered for resale by the selling
stockholders or until the shares can be sold without being so registered:
(1) our Annual Report on Form 10-K for the year ended December
31, 1999, filed on April 5, 2000, as amended by a filing on August 24, 2000;
(2) Our quarterly reports on Form 10-Q filed on May 15, 2000 (as
amended by a filing on August 24, 2000) and August 14, 2000;
(3) our current reports on Form 8-K filed as of January 6, 2000,
January 25, 2000 and August 16, 2000;
(4) the description of our common stock and Series A preferred
stock contained in our registration statements on Form 8-A filed as of January
12, 1995 and on Form 8-A/A filed as of February 16, 1995, October 9, 1997,
December 22, 1998, December 24, 1998 and August 25, 1999; and
(5) all future reports and other documents filed by us pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act shall be deemed to be
incorporated by reference herein and to be a part of this prospectus from the
date of filing of each of the reports and documents. Any statement incorporated
herein may modify or supersede information or statements in this prospectus.
Upon request, we will provide without charge a copy of this
prospectus, and a copy of any and all of the information that has been or may be
incorporated by reference in this prospectus. Requests for these copies should
be directed to Corporate Secretary, P-Com, Inc., 3175 S. Winchester Boulevard,
Campbell, California 95008 (telephone (408) 866-3666).
You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have authorized no
one to provide you with
13
<PAGE>
different information. Neither we nor the selling stockholders are making an
offer of these securities in any state where the offer is not permitted.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the common
stock by the selling stockholders.
DIVIDEND POLICY
Our credit agreement prohibits us from paying any dividend on our
common stock other than dividends paid in shares of our common stock. We
currently anticipate that we will retain any available funds for use in the
operation of its business, and we do not anticipate paying any cash dividends in
the foreseeable future.
SELLING STOCKHOLDERS
This offering relates to the resale of up to 8,888,591 shares of
Common Stock by the selling stockholders. We sold 7,530,642 of these shares to
the selling stockholders in a private placement on January 13, 2000, for an
aggregate gross consideration to us of $43,000,000, or $5.71 per share. The
closing sale price of our Common Stock on January 13, 2000 was $13.313 per
share.
The private placement purchase agreement also called for us to issue
common stock warrants to the selling stockholders if we did not register the
7,530,642 shares for resale by April 12, 2000. Under the agreement, the number
of warrant shares was to be equal to 3% of 7,530,642 times the number of months
beginning April 13, 2000 that the 7,530,642 shares were not registered for
resale. Partial months are treated as fractions of a month in the calculation.
Under the agreement, the exercise price of each warrant was to be 80% of the
lowest closing sale price of our Common Stock between January 13, 2000 and the
effective date of the registration statement which includes this prospectus. The
lowest closing sale price during that period was $4.75 on October 11, 2000, so
the exercise price is $3.80. The warrants will be exercisable until
October 14, 2003.
As part of the private placement purchase agreement, we agreed to
register the 7,530,642 shares and all shares underlying any warrants. Because
the registration statement was declared effective on October 13, 2000, we issued
1,357,949 to the selling stockholders for resale.
Other than stock ownership, no selling stockholder has held any office
or position, or has now or had, within the past three years, any material
relationship with us. The following table sets forth the aggregate number of
shares of common stock beneficially owned by each selling stockholder as of
September 15, 2000 and the percentage of all shares of common stock held by that
selling stockholder before and after giving effect to the offering based on
80,354,266 shares of common stock outstanding as of September 15, 2000. We
considered the following factors and made the following assumptions regarding
the table:
14
<PAGE>
. All warrants "earned" through October 13, 2000 are included in the
table despite the September 15, 2000 date of the table,
. beneficial ownership is determined in accordance with the rules of
the SEC, and
. the selling stockholders will sell all of the securities offered by
this prospectus.
Notwithstanding these assumptions, the selling stockholders may sell
less than all of the shares listed on the table. Each selling stockholder will
determine the number of shares of common stock that it will sell. In addition,
the shares listed below may be sold pursuant to this prospectus, under Rule 144,
or in privately negotiated transactions.
<TABLE>
<CAPTION>
Number of Percent of
Shares of Outstanding percent of
Common Stock Shares Number of Number of Outstanding
Beneficially Beneficially Shares to be Shares Shares
Owned Owned Sold Beneficially Beneficially
Before the Before the Pursuant to Owned After the Owned After the
Name of Selling Stockholder Offering Offering this Prospectus Offering Offering /(1)/
-------------------------------- -------------- ------------ --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Whitman Partners, L.P. 3,100,672 3.8% 3,100,672 0 0
Seligman Communications and 3,100,672 3.8% 3,100,672 0 0
Information Fund, Inc.
Lagunitas Partners L.P./(2)/ 1,057,738 1.3% 620,135 437,603 *
Quissett Partners, L.P. 539,516 * 539,516 0 0
Quissett Investors (Bermuda) L.P. 359,678 * 359,678 0 0
Weber Capital Partners, L.P. 310,068 * 310,068 0 0
Gruber McBaine International/(2)/ 379,947 * 258,390 121,557 *
Lion Investments Ltd. 155,033 * 155,033 0 0
Westpool Investment Trust 156,033 * 156,033 2,000 *
Vanguard Explorer Fund 103,355 * 103,355 0 0
Lockheed Martin Corp. Master 234,880 * 103,355 131,525 *
Retirement Trust/(2)/
Trustees of Hamilton College/(2)/ 101,639 * 51,677 49,962 *
Hazelbrook Partners, L.P. 31,007 * 31,007 0 0
</TABLE>
(1) Assumes that all the shares being offered by the selling stockholders under
this prospectus are sold, and that the selling stockholders acquire no
additional shares of Common Stock before the completion of this offering.
(2) Gruber & McBaine Capital Management is general partner of Lagunitas Partners
L.P. and is attorney in fact for Gruber McBaine International, Lockheed
Martin Corp. Master Retirement Trust and Trustees of Hamilton College. In
each of these capacities, Gruber & McBaine Capital Management has full
voting and investment power over all the indicated shares. Combined, the
shares so "beneficially owned" by Gruber & McBaine Capital Management
constitute 1,774,204 shares beneficially owned before this offering, or
2.2%; 1,033,557 shares to be sold pursuant to this prospectus; and 740,647
shares beneficially owned after the offering, or less than 1%.
* Less than 1%
15
<PAGE>
PLAN OF DISTRIBUTION
We will not receive any proceeds from the sale of the common stock
through this prospectus. We have agreed to pay the expenses of registration of
the common stock offered hereby, including legal and accounting fees, but
excluding underwriter's discounts and commissions, if any.
The offered shares may be sold from time to time at
. negotiated prices,
. fixed prices which may be changed,
. market prices prevailing at the time of sale or
. prices related to prevailing market prices.
The selling stockholders may effect those transactions
. in privately negotiated sales in the over-the-counter market or any
exchange on which the securities are listed,
. by selling the shares through broker-dealers, including
circumstances in which brokers or dealers attempt to sell the
shares to third parties, but, if they are initially unable to do
so, they may purchase the shares themselves and resell the shares
as principal, and
. in one or more underwritten offerings on a firm commitment or best
efforts basis.
Sales of selling stockholders' shares may also be made pursuant to
Rule 144 under the Securities Act, where applicable.
To the extent required under the Securities Act, the following
information will be set forth in a post-effective amendment to this prospectus:
. the aggregate amount of selling stockholders' shares being offered
and the terms of the offering,
. the names of any agents, brokers, dealers, transferees or
underwriters, and
. any applicable fee or commission with respect to a particular
offer.
Each selling stockholder will be responsible for paying compensation
owed by it to any underwriters, dealers, brokers or agents participating in the
distribution of its shares, regardless of whether that compensation is in the
form of underwriting discounts, concessions, commission or fees. This
compensation might be in excess of customary commissions. The aggregate
proceeds to a selling stockholder from the sale of its shares offered by this
prospectus will be the purchase price of those shares less any discounts or
commissions.
If selling stockholders pledge, hypothecate or grant a security
interest in some or all of the shares, then the pledgees, secured parties or
persons to whom those securities have been hypothecated shall, upon foreclosure
in the event of default, be named as selling stockholders in a supplement or
post-effective amendment to this prospectus. Similarly, if the
16
<PAGE>
selling stockholders transfer, pledge, donate or assign shares to lenders or
others, then each of those persons will be named as a selling stockholder in a
supplement or post-effective amendment to this prospectus. The number of shares
beneficially owned by the selling stockholders will decrease if and when a
selling stockholder transfers, pledges, donates or assigns shares. The plan of
distribution for selling stockholders' shares sold by this prospectus will
otherwise remain unchanged, except that the transferees, pledgees, donees or
other successors will be selling stockholders under this prospectus. There is,
however, no assurance that any selling stockholder will sell any or all of the
shares described in this prospectus.
A selling stockholder may also use this prospectus in the following
ways:
. to sell short, from time to time, shares of our common stock and,
in those instances, this prospectus may be delivered in connection
with those short sales and the shares offered by this registration
statement may be used to cover those short sales,
. to enter into hedging transactions with broker-dealers, and the
broker-dealers may engage in short sales of the shares in the
course of holding the positions they assume with that selling
stockholder, including, without limitation, in connection with
distribution of the shares by those broker-dealers,
. to enter into option or other transactions with broker-dealers that
involve the delivery of the shares to the broker-dealers, who may
then resell or otherwise transfer those shares, and
. to loan or pledge the shares to a broker-dealer and the broker-
dealer may sell the shares as loaned or upon a default may sell or
otherwise transfer the pledge shares.
The rules and regulations in Regulation M under the Securities Exchange Act of
1934 provide that during the period that any person is engaged in the
distribution, as defined in Regulation M, of our common stock, such person
generally may not purchase shares of our common stock. The selling stockholders
are subject to applicable provisions of the Securities Act of 1933 and
Securities Exchange Act of 1934 and the rules and regulations thereunder,
including, without limitation, Regulation M, which provisions may limit the
timing of purchases and sales of shares of the common stock by the selling
stockholders. The foregoing may affect the marketability of the common stock.
The selling stockholders, any underwriter, any broker-dealer or any
agent that participates with the selling stockholders in the distribution of the
shares may be deemed to be an "underwriter" within the meaning of the Securities
Act. As a result thereof, any discounts, commissions or concessions received by
them and any profit on the resales of the shares purchased by them may be deemed
to be underwriting commissions under the Securities Act.
To comply with securities laws of certain states, if applicable, the
shares will be sold in those jurisdictions only through registered or licensed
brokers or dealers. In addition, in certain states the shares may not be sold
unless they have been registered or qualified for sale in the applicable state
or an exemption from the registration or qualification requirement is available.
17
<PAGE>
We have agreed to keep the registration statement of which this
prospectus is a part continuously effective until all the shares are immediately
freely saleable under Rule 144(k). In this regard, we are required to
supplement and/or amend the registration statement of which this prospectus is a
part to supplement or change the selling stockholders hereunder.
Our agreements with the selling stockholders require us to indemnify
the selling stockholders, any underwriter and the respective directors,
officers, partners, members, employees, agents and controlling persons of each
selling stockholder against certain liabilities in connection with the offer and
sale of the shares hereunder, including under the Securities Act. Similarly,
each selling stockholder is required to indemnify us and our directors, the
officers who sign the registration statement of which this prospectus is a part,
our employees, agents and controlling persons against certain liabilities in
connection with the offer and sale of the shares hereunder, including the
Securities Act, to the extent that liability occurs as a result of reliance with
written information furnished to us by that selling stockholder expressly for
use in connection with the registration statement of which this prospectus is a
part. To the extent this indemnification is prohibited, the selling
stockholders and we are required to contribute to payments the parties may be
required to make in respect of otherwise indemnifiable claims.
LEGAL MATTERS
The validity of the common stock offered in this prospectus will be
passed upon for us by Brobeck, Phleger & Harrison LLP, San Diego, California.
As of the date of this prospectus, attorneys of Brobeck, Phleger & Harrison LLP
and their family members beneficially owned an aggregate of approximately 64,000
shares of our common stock.
EXPERTS
The consolidated financial statements incorporated in this Prospectus
by reference to the Annual Report on Form 10-K/A for the year ended December
31, 1999 have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
18
<PAGE>
================================================================================
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
SUMMARY.................................................................... 2
RISK FACTORS............................................................... 3
WHERE YOU CAN FIND MORE INFORMATION........................................ 13
USE OF PROCEEDS............................................................ 14
DIVIDEND POLICY............................................................ 14
SELLING STOCKHOLDERS....................................................... 14
PLAN OF DISTRIBUTION....................................................... 16
LEGAL MATTERS.............................................................. 18
EXPERTS.................................................................... 18
</TABLE>
8,888,591 Shares
P-COM, INC.
common stock
------------
PROSPECTUS
------------
October 13, 2000
================================================================================
