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Previous: CONTROLLED ENVIRONMENTAL AQUACULTURE TECHNOLOGY INC, NT 10-Q, 2000-12-04 |
Next: SOCKET COMMUNICATIONS INC, S-3, EX-5.1, 2000-12-04 |
As filed with the Securities and Exchange Commission on December 4, 2000 Registration No. 333-____________
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-3
REGISTRATION STATEMENT
Under The Securities Act of 1933
SOCKET COMMUNICATIONS, INC. (Exact name of Registrant as specified in charter)
37400 Central Court Newark, CA 94560 (510) 744-2700 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices)
David W. Dunlap Chief Financial Officer SOCKET COMMUNICATIONS, INC. 37400 Central Court Newark, CA 94560 (510) 744-2700 (Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to: Herbert P. Fockler, Esq. Tracy Donsky, Esq. WILSON SONSINI GOODRICH & ROSATI Professional Corporation 650 Page Mill Road Palo Alto, CA 94304 (650) 493-9300
Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering pursuant to Rule 426(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
|
Title of Each Class of Securities to be Registered |
Amount to be Registered |
Proposed Maximum Offering Price Per Share(1) |
Proposed Maximum Aggregate Offering Price(1) |
Amount of Registration Fee |
|
Common Stock, $0.001 par value per share |
850,032 shares |
$4.33 |
$3,680,638.56 |
$972.00 |
(1) Estimated solely for the purpose of calculation of the registration fee pursuant to Rule 457(c) under the Securities Act based on the average of the high and low selling prices of the Registrant's common stock on the Nasdaq National Market on November 30, 2000.
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to such Section 8(a), may determine.
SUBJECT TO COMPLETION, DATED DECEMBER 4, 2000
PROSPECTUS
850,032 Shares
Socket Communications, Inc.
Common Stock
This prospectus relates to the public offering, which is not being underwritten, of up to 850,032 shares of our common stock held by the selling stockholders identified in this prospectus, and may be sold from time to time by those selling stockholders.
The prices at which the selling stockholders may sell the shares will be determined by the prevailing market prices for the shares or in negotiated transactions. We will not receive any of the proceeds from the sale of the shares.
Our common stock is quoted on the Nasdaq National Market under the symbol "SCKT." On November 30, 2000, the last sale price for our common stock as reported on the NASDAQ National Market was $4.31 per share.
Investing in the common stock involves risks. See "Risk Factors".
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is December 4, 2000.
The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securites and Exchange Commission is effective. This prospectus is not an offer to sell these securites and it is not soliciting an offer to buy these securites in any state where the offer or sale is not permitted.
TABLE OF CONTENTS
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus. The selling stockholders listed in this prospectus are offering to sell, and seeking offers to buy shares of our common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common stock.
You can contact us by mail at Socket Communications, Inc., 37400 Central Court, Newark, CA 94560 or by phone at (510) 744-2700.
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements within the meaning of the securities laws. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control. All statements other than statements of historical facts included in this prospectus, including the statements under "The Company" and elsewhere in this prospectus regarding our strategy, future operations, financial position, "estimated revenues," projected costs, prospects, plans and objectives of management, are forward-looking statements. When used in this prospectus, the words "will," "believe," "anticipate," "intend," "estimate," "expect," "project" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. All forward-looking statements speak only as of the date of this prospectus. Neither we nor any of the selling stockholders undertake any obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements we make in this prospectus are reasonable, ultimately we may not achieve such plans, intentions or expectations.
We disclose important factors that could cause our actual results to differ materially from our expectations under "Risk Factors" and elsewhere in this prospectus. Such factors include, among others, the following: our ability to raise sufficient capital to fund our working capital requirements, the impact on our stock price of shares eligible for future issuance, including shares that may be sold under this prospectus, our ability to achieve profitability, developments in the market for our products, including the market for mobile computers that use the Windows-powered operating system, and developments in our relationships with our strategic partners. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.
RISK FACTORS
An investment in the common stock offered by this prospectus involves a high degree of risk. You should carefully consider the risks described below before deciding to purchase the shares of common stock. The risks described below are not the only ones that we face. Additional risks that generally apply to publicly traded companies, that are not yet identified or that we currently think are immaterial, may also adversely affect our company.
Any of the following factors could adversely affect our business, financial condition or results of operations. The trading price of our common stock could, in turn; decline and you could lose all or part of your investment.
We have a history of operating losses and we cannot assure you that we will achieve ongoing profitability
We were incorporated in March 1992 and have incurred significant operating losses in every fiscal period since inception. We may continue to incur quarterly operating losses at least through the first half of 2001 and possibly longer. Profitability, if any, will depend upon:
We have historically relied on our ability to raise equity capital to fund our operating losses and working capital requirements
Since our inception, we have raised approximately $32 million in equity capital and at September 30, 2000, we had an accumulated deficit of approximately $21.4 million. Although we believe that our cash balances as of September 30, 2000 of $8.9 million are adequate to fund our operations for at least a year, continued losses could make it necessary for us to raise additional capital in the future. We may not be able to raise additional capital on acceptable terms, if at all. If we do, the additional capital may be on terms that are dilutive to existing stockholders.
Shares eligible for future sale may adversely affect the market price for our common stock
As of November 13, 2000, we had outstanding securities convertible into or exercisable for the following amounts of common stock, all of which have been registered for resale under the Securities Act of 1933 and accordingly, may be sold into the market without restriction under the Securities Act of 1933:
The sale of these shares of common stock in the market, as well as the perception that such shares are available for sale, has in the past and could in the future adversely affect the market price of our common stock and make it more difficult to sell our common stock in the future.
We depend significantly on the market for mobile computers, particularly those that use the Windows-powered operating system for handheld computers (formerly Windows CE)
Substantially all of our products are designed for use in mobile computers, including notebooks, handheld PCs, Palm-size PCs, tablet PCs, and H/PC Professionals (mini notebooks). The market for mobile computers is characterized by rapidly changing technology, evolving industry standards, frequent new product introductions and significant price competition. These characteristics result in short product life cycles and regular reductions of average selling prices over the life of a specific product. Accordingly, growth in demand for mobile computers is uncertain. If such growth does not occur, demand for our products would be reduced.
Our ability to generate increased revenues depends significantly on the commercial success of Windows-powered notebooks, handheld PCs (H/PCs, Pocket PCs, tablet PCs, and H/PC Professionals) and other devices. As a result, our future success depends on factors outside of our control, including market acceptance of Windows-powered operating system devices generally and other factors affecting the commercial success of Windows-powered computers and devices, including changes in industry standards or the introduction of new or competing technologies. Any delays in or failure of Windows-powered devices to achieve or maintain market acceptance would reduce the number of potential customers of our products.
Our ability to comply with industry standards is critical to our business
We must continue to identify and ensure compliance with evolving industry standards to remain competitive. Unanticipated changes in industry standards could render our products incompatible with products developed by major hardware manufacturers and software developers. We could be required, as a result, to invest significant time and resources to redesign our products to ensure compliance with relevant standards. If our products are not in compliance with prevailing industry standards for a significant period of time, we would miss opportunities to have our products specified as standards for new hardware components designed by mobile computer manufacturers and OEMs. The failure to achieve any such design win would result in the loss of any potential sales volume that could be generated by such newly designed hardware component.
We depend on alliances and other business relationships with a small number of third parties
Our strategy is to establish strategic alliances and business relationships with leading participants in various segments of the communications and mobile computer markets. In accordance with this strategy, we have entered into alliances or relationships with Axis Communications, Bell Mobility, Cambridge Silicon Radio, Compaq Computer Corporation, Hewlett-Packard Corporation, Hitachi, Intermec, Microsoft, SanDisk Corporation, Sprint PCS, Symbol Technologies, Targus International and Welch Allyn. Our success will depend not only on our continued relationships with these parties, but also on our ability to enter into additional strategic arrangements with new partners on commercially reasonable terms. We believe that, in particular, relationships with application software developers are important in creating commercial uses for our products. Any future relationships may require us to share control over our development, manufacturing and marketing programs or to relinquish rights to certain versions of our technology. Also, our strategic partners may revoke their commitment to our products or services at any time in the future, or may develop their own competitive products or services. Also, the hardware or software of such companies that is integrated into our products may contain defects or errors. Accordingly, our strategic relationships may not result in sustained business alliances, successful product or service offerings or the generation of significant revenues. Failure of one or more of such alliances could result in delay or termination of product development projects, reduction in market penetration, decreased ability to win new customers or loss of confidence by current or potential customers.
We have devoted significant research and development resources to design activities for Windows-powered mobile products, diverting financial and personnel resources from other development projects. These design activities are not undertaken pursuant to any agreement under which Microsoft is obligated to continue the collaboration or to support resulting products. Consequently, Microsoft may terminate its collaborations with us for a variety of reasons including our failure to meet agreed-upon standards or for reasons beyond our control, including changing market conditions, increased competition, discontinued product lines and product obsolescence.
The market for our products changes rapidly, and our success depends upon our ability to develop new and enhanced products
The market for our products is characterized by rapidly changing technology, evolving industry standards and short product life cycles. Accordingly, to remain competitive we must:
Given the emerging nature of the mobile computing products market, our products or technology may be rendered obsolete by alternative technologies. Further, short product life cycles expose our products to the risk of obsolescence and require frequent new product introductions. If we fail to develop or obtain access to advanced mobile communications technologies as they become available, or if we fail to develop and introduce competitive new products on a timely basis, our future operating results will be adversely affected.
Our products may contain undetected flaws and defects
Although we perform testing prior to new product introductions, our hardware and software products may contain undetected flaws, which may not be discovered until the products have been used by customers. From time to time, we may temporarily suspend or delay shipments or divert development resources from other projects to correct a particular product deficiency. Such efforts to identify and correct errors and make design changes may be expensive and time consuming. Failure to discover product deficiencies in the future could delay product introductions or shipments, require us to recall previously shipped products to make design modifications or cause unfavorable publicity, any of which could adversely affect our business.
Our quarterly operating results may fluctuate in future periods and our future results are difficult to predict because we typically have little order backlog
We expect to experience quarterly fluctuations in operating results in the future. We generally ship orders as received and as a result typically have little or no backlog. Quarterly revenues and operating results therefore depend on the volume and timing of orders received during the quarter, which are difficult to forecast. Historically, we have often recognized a substantial portion of our revenues in the last month of the quarter. This subjects us to the risk that even modest delays in orders adversely affect our quarterly operating results. Our operating results may also fluctuate due to factors such as:
Because we base our staffing and other operating expenses on anticipated revenue, delays in the receipt of orders can cause significant variations in operating results from quarter to quarter. As a result of any of the foregoing factors, our results of operations in any given quarter may be below the expectations of public market analysts or investors, in which case the market price of our common stock would be adversely affected.
We depend on key employees and we need to hire additional sales and marketing and product development personnel
Our future success will depend upon the continued service of certain key technical and senior management personnel. Competition for such personnel is intense, and there can be no assurance that we will be able to retain our existing key managerial, technical or sales and marketing personnel. The loss of key personnel has in the past and could in the future, adversely affect our business.
We believe our ability to achieve increased revenues and to develop successful new products and product enhancements will depend in part upon our ability to attract and retain highly skilled sales and marketing and product development personnel. Competition for such personnel is intense, and we may not be able to retain such key employees, and there are no assurances that we will be successful in attracting and retaining such personnel in the future. In addition, our ability to hire and retain such personnel will depend upon our ability to raise capital or achieve increased revenue levels to fund the costs associated with such personnel. Failure to attract and retain key personnel will adversely affect our business.
We depend on distributors, resellers and OEMs to sell our products
We sell our products primarily through distributors, resellers and original equipment manufacturers, or OEMs. Our largest distributor, Ingram Micro in the United States, accounted for approximately 24% of our revenue in 1999 and 26% of our revenue in the first nine months of 2000. Our agreements with OEMs, distributors and resellers, in large part, are nonexclusive and may be terminated on short notice by either party without cause. Our OEMs, distributors and resellers are not within our control, are not obligated to purchase products from us and may represent other lines of products. A reduction in sales effort or discontinuance of sales of our products by our OEMs, distributors and resellers could lead to reduced sales.
Use of distributors also entails the risk that distributors will build up inventories in anticipation of a growth in sales. If such growth does not occur as anticipated, these distributors may substantially decrease the amount of product ordered in subsequent quarters. Such fluctuations could contribute to significant variations in our future operating results. The loss or ineffectiveness of any of our major distributors or OEMs could adversely affect our operating results.
We allow our distributors to return a portion of our inventory to us for full credit against other purchases. In addition, in the event we reduce our prices, we credit our distributors for the difference between the purchase price of products remaining in their inventory and our reduced price for such products. Actual returns and price protection may adversely affect future operating results, particularly since we seek to continually introduce new and enhanced products and are likely to face increasing price competition.
A significant portion of our revenues are derived from export sales
Export sales (sales to customers outside the United States) accounted for approximately 34% of our revenue in 1999 and 21% of our revenue in the first nine months of 2000. Accordingly, our operating results are subject to the risks inherent in export sales, including
In addition, our export sales are currently denominated predominately in United States dollars and in Euros for a portion of our sales to our European distributors. Accordingly, an increase in the value of the United States dollar relative to foreign currencies could make our products more expensive and therefore potentially less competitive in foreign markets and declines in value in the Euro relative to the dollar may result in foreign currency losses relating to collection of Euro denominated receivables.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares sold under this prospectus. All proceeds from the sale of the shares will be for the account of the selling stockholders. See "Selling Stockholders" and "Plan of Distribution."
THE COMPANY
We are a leading supplier of connectivity products to the Windows-powered handheld and notebook computing market. During 1998, we expanded our PC Card connection family of products to add a family of CompactFlash ("CF+") Peripheral Connection, low power Ethernet and Data Collection (bar code scanning) connection products to support the smallest Windows-powered handheld computer, the Pocket PC. We expanded this family in the second half of 1999 with the development of an integrated CF+ bar code scanner ("In-Hand Scan Card") and Digital Phone Cards for the North American CDMA and worldwide GSM telephone markets. Our families of low-power Peripheral Connection and Ethernet Card connection products, our family of Data Collection Cards for bar code scanning products, and, commencing with the fourth quarter of 1999, our family of Digital Phone Cards, are our principal sources of revenues.
Four classes of Windows-powered handheld computers are now available from a number of computer manufacturers: the H/PC professional (mini-notebook); the H/PC (clam shell design with keyboard); the Pocket PC (pocket-sized computer) and the tablet PC (ruggedized touch screen in mini-notebook size). These computers are desktop companions designed to synchronize with a Windows desktop computer. They also operate on double-A size rechargeable batteries, as low power consumption is an important feature for products that plug into and are powered by the computer. The H/PC professional and the H/PC have a PC Card slot for input/output. The Pocket PC, some H/PC professionals and the tablet PCs have a CF+ slot for input/output. The H/PC professionals were released in the second half of 1998, color Palm-size PCs were released in the first quarter of 1999 and their successor, the Pocket PC, was released in April 2000, and the tablet PCs were released beginning in the third quarter of 1999. All of our low power Battery FriendlyÔ products are designed to work with these Windows-powered handheld computers and also with Windows notebook computers.
We distribute our products primarily through worldwide distribution channels. In the United States, our products are distributed by Ingram Micro and Tech Data who resell to computer retail stores, electronic products catalog companies and value added resellers. We also sell our products internationally through 35 distributors in 24 countries in Europe, Asia and the Pacific Rim. In addition, we sell direct to selected large customers, particularly for custom products sold to original equipment manufacturers.
Our core technologies are in transferring data into and out of Windows-powered mobile computing devices through the PC Card or CF+ slot, achieving high data transfer speeds and low power consumption. Our peripheral connection products are designed to connect one or more peripheral devices such as a keyboard, monitor or another computer, to a mobile computer. Our data collection cards are designed to connect bar code scanners such as a bar code wand, scanning gun, or a bar code printer to a mobile computer. Our digital phone cards are designed to connect a data-enabled mobile phone to a mobile computer. Our Ethernet cards are designed to connect a mobile computer to an Ethernet network. Our connection product strategy has been to create a broad family of low-power connection products in PC card and in CF+ form factor, with standard (removable cable) or ruggedized (fixed cable) designs that work with Windows-powered handheld and notebook computers.
Our research and development activities during 2000 include the development of a smaller input/output connection product in the secure digital (SD) open standard form factor initially introduced by SanDisk Corporation as a memory card product. Palm, Inc., which manufactures the Palm Pilot, has announced that its next generation Palm Pilot scheduled for release in the first half of 2001 will have an SD expansion slot, and we are working with Palm, Inc. to develop our SD cards to work with the Palm Pilot. Our development activities also include the addition of a removable MultiMediaCard memory slot to our CF+ input/output cards to create combination input/output and removable memory cards, and the creation of Personal Network CF+ cards and embedded modules utilizing Bluetooth wireless technology to facilitate wireless communications between electronic devices within a 30 foot range of each other. These products are also expected to reach the market during the first half of 2001. We also acquired 3rd Rail Engineering in October 2000, an engineering design and services company whose business is the design of embedded systems, and we plan to offer design and integration services for our Bluetooth modules and other products.
We believe that we have developed strong working relationships with Microsoft and with Windows-powered mobile computer manufacturers for integrating connection solutions into Windows-powered mobile computing devices. We have also developed strategic relationships with:
Although we believe that our focus on the Windows CE operating system for handheld computers, our expanding family of connection products and our relationships with key industry strategic partners position us for future revenue growth, we have incurred significant quarterly and annual operating losses in every fiscal period since our inception, and we may continue to incur quarterly operating losses at least through the first half of 2001 and possibly longer.
SELLING STOCKHOLDERS
The following table sets forth, as of the date of this prospectus:
The shares may be offered by the selling stockholders or by pledgees, donees, transferees or other successors in interest that receive such shares as a gift or through another non-sale related transfer. We may amend or supplement this prospectus from time to time to update the information provided in the table.
Name of Selling Stockholder |
Shares Beneficially Owned Prior to Offering |
Number of Shares Being Offered |
Shares Beneficially Owned After Offering |
||
Number |
Percent(1) |
Number |
Percent(1) |
||
Paul Hughes |
282,045 |
1.2% |
282,045 |
0 |
* |
Robert Miller |
282,045 |
1.2% |
282,045 |
0 |
* |
Thomas Newman |
102,161 |
* |
102,161 |
0 |
* |
Greater Bay Bank(2) |
50,000 |
* |
50,000 |
0 |
* |
Michael Hughes |
48,510 |
* |
48,510 |
0 |
* |
Cathy Hughes |
36,351 |
* |
36,351 |
0 |
* |
Charles Ader |
15,041 |
* |
15,041 |
0 |
* |
Gerald Herbel |
7,445 |
* |
7,445 |
0 |
* |
Nik Lewis |
7,445 |
* |
7,445 |
0 |
* |
James Rebello |
5,565 |
* |
5,565 |
0 |
* |
Paul Zelasko |
5,565 |
* |
5,565 |
0 |
* |
Melinda Hughes |
4,109 |
* |
4,109 |
0 |
* |
Nishi Corporation |
3,750 |
* |
3,750 |
0 |
* |
TOTAL |
850,032 |
3.7% |
850,032 |
0 |
* |
* Less than 1%.
(1)Based upon 22,744,723 shares of common stock outstanding as of the close of business on November 30, 2000.
(2)Represents shares issuable upon exercise of a warrant dated October 15, 1999.
PLAN OF DISTRIBUTION
The shares of common stock covered by this prospectus may be offered and sold from time to time by the selling stockholders. The selling stockholders will act independently of us in making decisions with respect to the timing, manner and size of each sale of the common stock covered hereby. The selling stockholders may sell the shares being offered hereby on the Nasdaq National Market, or otherwise at prices and at terms then prevailing or at prices related to the then current market price or at negotiated prices. Shares may be sold by one or more of the following means of distribution:
To the extent required, this prospectus may be amended and supplemented from time to time to describe a specific plan of distribution.
In connection with distributions of the shares offered hereby, the selling stockholders may enter into hedging transactions with broker-dealers or other financial institutions. In connection with such transactions, broker-dealers or other financial institutions may engage in short sales of our common stock in the course of hedging the positions they assume with selling stockholders. The selling stockholders may also sell our common stock short and deliver the shares offered hereby to close out such short positions. The selling stockholders may also enter into option or other transactions with broker-dealer or other financial institutions which require the delivery to such broker-dealers or other financial institution of shares offered hereby, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction). The selling stockholders may also pledge the shares offered hereby to a broker-dealer or other financial institution, and, upon a default, such broker-dealer or other financial institution, may effect sales of the pledged shares pursuant to this prospectus (as supplemented or amended to reflect such transaction). In addition, any shares offered hereby that qualify for sale pursuant to Rule 144 may, at the option of the holder thereof, be sold under Rule 144 rather than pursuant to this prospectus.
Any broker-dealer participating in such transactions as agent may receive commissions from the selling stockholders (and, if acting as agent for the purchaser of such shares, from such purchaser). Usual and customary brokerage fees will be paid by the selling stockholders. Broker-dealers may agree with the selling stockholders to sell a specified number of shares at a stipulated price per share, and, to the extent such a broker-dealer is unable to do so acting as agent for the selling stockholders, to purchase as principal any unsold shares at the price required to fulfill the broker-dealer commitment to the selling stockholders. Broker-dealers who acquire shares as principal may thereafter resell such shares from time to time in transactions (which may involve crosses and block transactions and which may involve sales to and through other broker-dealers, including transactions of the nature described above) in the over-the-counter market, in negotiated transactions or by a combination of such methods of sale or otherwise at market prices prevailing at the time of sale or at negotiated prices, and in connection with such resales may pay to or receive from the purchasers of such shares commissions computed as described above.
We have advised the selling stockholders that the anti-manipulation of Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the selling stockholders and their affiliates. In addition, we will make copies of this prospectus available to the selling stockholders and have informed them of the need for delivery of copies of this prospectus to purchasers on or prior to sales of the shares offered hereby. The selling stockholders may indemnify any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities arising under the Securities Act. Any commissions paid or any discounts or concessions allowed to any such broker-dealers, and any profits received on the resale of such shares, may be deemed to be underwriting discounts and commissions under the Securities Act if any such broker-dealers purchase shares as principal.
In order to comply with the securities laws of certain states, if applicable, the common stock will be sold in such jurisdictions only through registered or licensed brokers or dealers. In addition, in certain states, the common stock may not be sold unless such shares have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.
There can be no assurance that the selling stockholders will sell all or any of the shares of common stock offered under this prospectus.
LEGAL MATTERS
Wilson Sonsini Goodrich & Rosati, Professional Corporation, Palo Alto, California will pass upon certain legal matters relating to the validity of the securities offered hereby for Socket Communications.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our financial statements and schedule included in our Annual report on form 10-KSB/A for the year ended December 31, 1999, as set forth in their report, which is incorporated by reference in this prospectus and elsewhere in the registration statement. Our financial statements and schedule are incorporated by reference in reliance on Ernst & Young LLP's report, given on their authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the Securities and Exchange Commission a registration statement on Form S-3, of which this prospectus is a part, under the Securities Act with respect to the shares of common stock offered hereby. This prospectus does not contain all of the information included in the registration statement. Statements in this prospectus concerning the provisions of any document are not necessarily complete. You should refer to the copies of these documents filed as exhibits to the registration statement or otherwise filed by us with the SEC for a more complete understanding of the matter involved. Each statement concerning these documents is qualified in its entirety by such reference.
We are subject to the informational requirements of the Exchange Act and, accordingly, file reports, proxy statements and other information with the SEC. The SEC maintains a website that contains reports, proxy statements and other information regarding us. The address of the SEC website is http://www.sec.gov. Copies of our reports, proxy statements and other information also may be inspected and copied at the public reference facilities maintained by the SEC at:
Judiciary Plaza Room 1024 450 Fifth Street, N.W. Washington, D.C. 20549 |
Citicorp Center 500 West Madison Street Suite 1400 Chicago, IL 60661 |
Seven World Trade Center 13th Floor New York, NY 10048 |
Copies of these materials can also be obtained by mail at prescribed rates from the Public Reference Section of the SEC, 450 Fifth Street, N.W., Washington, D.C. 20549 or by calling the SEC at 1-800-SEC-0330. Our reports, proxy statements and other public filings may also be inspected at:
The National Association of Securities Dealers 1735 K Street, N.W. Washington, D.C. 20006
DOCUMENTS INCORPORATED BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file with them, which means that we can disclose important information to you in this document by referring you to other filings we have made with the SEC. 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 Exchange Act prior to the completion of the offering covered by this prospectus:
our Annual Report on Form 10-KSB and Form 10KSB/A for the year ended December 31, 1999;
our Quarterly Reports on Form 10-QSB for the quarters ended March 31, 2000, June 30, 2000, and September 30, 2000;
our current report on Form 8K filed on October 20, 2000; and
the description of our common stock contained in our Registration Statement on Form 8-A filed with the SEC on April 11, 1995 and our Registration Statement on Form 8-A/A filed with the SEC on June 15, 1995.
We will provide to any person, including any beneficial owner, to whom a prospectus is delivered, a copy of any of the information which has been incorporated by reference into this prospectus at no cost upon an oral or written request to:
Socket Communications, Inc.
37400 Central Court
Newark, CA 94560
Attention: David W. Dunlap
(510) 744-2735
You can also call David W. Dunlap, Chief Financial Officer of Socket Communications, at (510) 744-2735 with any questions about the offering.
850,032 Shares
SOCKET COMMUNICATIONS, INC.
Common Stock
PROSPECTUS
No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus. You must not rely on any unauthorized information or representations. This prospectus is an offer to sell only the shares offered hereby, and only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date.
December 4, 2000
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The Company will bear no expenses in connection with any sale or other distribution by the selling stockholders of the shares being registered other than the expenses of preparation and distribution of this Registration Statement and the Prospectus included in this Registration Statement. Such expenses are set forth in the following table. All of the amounts shown are estimates except the Securities and Exchange Commission ("SEC") registration fee.
Amount To Be Paid |
|
SEC registration fee |
$ 826 |
Nasdaq National Market listing fee |
8,000 |
Legal fees and expenses |
15,000 |
Accounting fees and expenses |
10,000 |
Miscellaneous |
1,500 |
Total |
$ 35,326 |
Item 15. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law (the "Delaware Law") authorizes a court to award, or a corporation's Board of Directors to grant, indemnity to directors and officers in terms sufficiently broad to permit such indemnification under certain circumstances for liabilities (including reimbursement for expenses incurred) arising under the Securities Act of 1933. Article VII of the Registrant's Certificate of Incorporation and Article VI of the Registrant's Bylaws provide for indemnification of the Registrant's directors, officers, employees and other agents to the maximum extent permitted by Delaware Law. In addition, the Registrant has entered into Indemnification Agreements with its officers and directors and certain stockholders.
Insofar as indemnification by us for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the provisions referenced above or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by one of our directors, officers, or controlling persons in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered hereunder, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
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Item 16. Exhibits
Exhibits |
|
5.1 |
Opinion of Wilson Sonsini Goodrich & Rosati, P.C. |
23.1 |
Consent of Ernst & Young LLP, independent auditors. |
23.2 |
Consent of Wilson Sonsini Goodrich & Rosati, P.C.(included in Exhibit 5.1). |
24.1 |
Power of Attorney (see page II-3). |
Item 17. Undertakings
The undersigned Registrant hereby undertakes to:
(1) File, during any period in which offers or sales are being made, a post-effective amendment to this registration statement to:
(i) Include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(ii) Reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) (par 230.424(b) of this chapter) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement;
(iii) Include any additional or changed material information on the plan of distribution; provided, however, that subparagraphs (i) and (ii) shall not apply if the information required to be included in a post-effective amendment by those subparagraphs is contained in periodic reports filed with or furnished to the Securities and Exchange Commission by the Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the Registration Statement.
(2) For the purpose of determining any liability under the Securities Act of 1933, treat each post-effective amendment as a new registration of the securities offered therein, and the offering of such securities at that time to be the initial bona fide offering.
(3) Remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of this offering.
(4) For the purpose of determining any liability under the Securities Act of 1933, treat each filing of the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in this Registration Statement as a new registration statement relating to the securities offered therein, and the offering of such securities at that time to be the initial bona fide offering.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements of filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Newark, State of California, on the 1st day of December, 2000.
SOCKET COMMUNICATIONS, INC.
By:/s/ David W. Dunlap David W. Dunlap Chief Financial Officer and Vice President of Finance and Administration
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints, jointly and severally, Kevin Mills and David W. Dunlap, and each one of them, individually and without any other, his attorney-in-fact, each with full power of substitution, for him in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement, and to sign any registration statement for the same offering covered by this Registration Statement that is to be effective upon filing pursuant to Rule 462(b) promulgated under the Securities Act of 1933, and all post-effective amendments thereto, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed on the 1st day of December, 2000 by the following persons in the capacities indicated.
Signature |
Title |
/s/ Kevin Mills Kevin Mills |
President, Chief Executive Officer (Principal Executive), and Director |
/s/ Charlie Bass |
Chairman of the Board |
/s/ David W. Dunlap |
Vice President of Finance and Administration and Chief Financial Officer (Principal Financial and Accounting Officer) |
/s/ Micheal Gifford |
Executive Vice President and Director |
/s/ Jack Carsten |
Director |
/s/ Enzo Torresi |
Director |
/s/ Gianluca Rattazzi |
Director |
/s/ Leon Malmed |
Director |
/s/ Burnett Donoho |
Director |
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EXHIBIT INDEX
Exhibit |
Description |
5.1 |
Opinion of Wilson Sonsini Goodrich & Rosati, P.C. |
23.1 |
Consent of Ernst & Young LLP, independent auditors. |
23.2 |
Consent of Wilson Sonsini Goodrich & Rosati, (included in Exhibit 5.1). |
24.1 |
Power of Attorney (see page II-3). |
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|
|