AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 21, 2008
REGISTRATION NO. 333-
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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NEXTWAVE WIRELESS INC.
(Exact name of registrant as specified in its charter)
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DELAWARE 3663 20-5361360
(State or Other (Primary Standard (I.R.S. Employer
Jurisdiction of Industrial Identification
Incorporation or Classification Code No.)
Organization) Number)
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12670 HIGH BLUFF DRIVE
SAN DIEGO, CALIFORNIA 92130
(858) 480-3100
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
FRANK A. CASSOU
EXECUTIVE VICE PRESIDENT - CORPORATE DEVELOPMENT AND CHIEF LEGAL COUNSEL
NEXTWAVE WIRELESS INC.
12670 HIGH BLUFF DRIVE
SAN DIEGO, CALIFORNIA 92130
(858) 480-3100
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
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Copies to:
Marita Makinen, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
(212) 310-8000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to
time after this registration statement becomes effective.
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, as amended (the "Securities Act"), check the following box.[X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, 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 this form is a post effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.[_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box.[_]
CALCULATION OF REGISTRATION FEE
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PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH AMOUNT TO OFFERING AGGREGATE AMOUNT OF
CLASS OF SECURITIES BE PRICE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED(1) PER SHARE PRICE FEE
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Shares of common stock.... 9,101,718 $4.95(2) $45,053,949.60 $1,770.60
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(1) Pursuant to Rule 415 of the Securities Act of 1933, as amended, or the
Securities Act, this registration statement also registers such additional
shares of common stock of the Registrant as may hereafter be offered or
issued to prevent dilution resulting from stock splits, stock dividends,
recapitalizations or other capital adjustments.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c) of the Securities Act, based on the price of securities of
the same class, based on the average of the high and low prices of the
shares reported on The Nasdaq Global Market on March 18, 2008.
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 OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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 relating to these
securities 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.
SUBJECT TO COMPLETION, DATED MARCH 21, 2008
PROSPECTUS
9,101,718 SHARES
NextWave Wireless
Common Stock
par value $0.001 per share
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This prospectus relates solely to the resale of up to an aggregate of
9,101,718 shares of common stock of NextWave Wireless Inc. ("NextWave" or the
"Company") by the selling stockholders identified in this prospectus. These
shares were issued to the selling stockholders in connection with the
acquisition of IPWireless by NextWave Wireless Inc. in May 2007.
The selling stockholders identified in this prospectus (which term as used
herein includes their pledgees, donees, transferees or other
successors-in-interest) may offer the shares from time to time as they may
determine through public or private transactions or through other means
described in the section entitled "Plan of Distribution" beginning on page 32 at
prevailing market prices, at prices different than prevailing market prices or
at privately negotiated prices. The prices at which the selling stockholders may
sell the shares may be determined by the prevailing market price for the shares
at the time of sale, may be different than such prevailing market prices or may
be determined through negotiated transactions with third parties.
We will not receive any of the proceeds from the sale of these shares by
the selling stockholders. We have agreed to pay all expenses relating to
registering the securities. The selling stockholders will pay any brokerage
commissions and/or similar charges incurred for the sale of these shares of our
common stock.
Our shares are listed on The Nasdaq Global Market under the ticker symbol
"WAVE".
Investing in our common stock involves significant risks. See "Risk
Factors" beginning on page 6 to read about factors you should consider before
buying shares of our common stock.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER REGULATORY
BODY HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY
OF ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
PROSPECTUS DATED MARCH , 2008
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement on Form S-3 that we
filed with the Securities and Exchange Commission, or the SEC, using a "shelf"
registration or continuous offering process. Under this shelf process, certain
selling stockholders may from time to time sell the shares of common stock
described in this prospectus in one or more offerings.
You should rely only on the information contained or incorporated by
reference in this prospectus. Neither we nor the selling shareholders have
authorized anyone to provide you with different information. If anyone provides
you with different or inconsistent information, you should not rely on it. The
selling shareholders are not making an offer to sell these securities in any
jurisdiction where the offer or sale of these securities is not permitted. You
should assume that the information appearing in this prospectus is accurate only
as of the date on the front cover of this prospectus and that any information we
have incorporated by reference is accurate only as of the date of the document
incorporated by reference. Our business, financial condition, results of
operations and prospects may have changed since these dates.
TABLE OF CONTENTS
PAGE
PROSPECTUS SUMMARY.....................................................1
THE OFFERING...........................................................5
RISK FACTORS...........................................................6
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS.....................17
USE OF PROCEEDS.......................................................18
SELLING STOCKHOLDERS..................................................19
DESCRIPTION OF CAPITAL STOCK..........................................28
PLAN OF DISTRIBUTION..................................................32
LEGAL MATTERS.........................................................34
EXPERTS...............................................................34
WHERE YOU CAN FIND MORE INFORMATION...................................34
INCORPORATION BY REFERENCE............................................35
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PROSPECTUS SUMMARY
This summary highlights key aspects of our business that are described in
more detail in our reports filed with the Securities and Exchange Commission.
This summary does not contain all of the information that you should consider
before making a future investment decision with respect to our securities. You
should read this entire registration statement carefully, including the "Risk
Factors," the combined audited financial statements and the notes thereto and
the documents incorporated by reference herein or therein.
Unless the context indicates otherwise, all references in this
registration statement to "NextWave," "the Company," "we," "us" and "our" refer
to NextWave Wireless Inc. and its direct and indirect subsidiaries.
OUR COMPANY
BUSINESS OVERVIEW
We are a mobile broadband and multimedia technology company that develops,
produces, and markets mobile multimedia and wireless broadband products,
including fourth generation ("4G") wireless broadband semiconductors,
device-embedded software for mobile handsets, mobile TV systems, and mobile
broadband network equipment. Our products and technologies are designed to power
wireless networks and devices that enable cutting-edge mobile multimedia and
wireless broadband services. At present, our customers include many of the
largest mobile handset and wireless service providers in the world including
Orange, Motorola, Nokia, NTT DoCoMo, Panasonic, Sony Ericsson, T- Mobile, and
Verizon Wireless.
We believe that mobile multimedia applications such as mobile TV,
video-on-demand ("VOD"), and streaming audio will be the driving force behind
global adoption of next-generation network technologies and end-user devices.
Our business activities are focused on developing the technologies and products
that enable mobile operators and device manufacturers to deliver these types of
advanced mobile multimedia services to customers.
To help drive sales of our mobile multimedia and wireless broadband
products, we intend to make our significant spectrum holdings available,
consistent with regulatory requirements, to network operators who build and
operate wireless systems that utilize our technologies. Our spectrum holdings,
which consists of approximately 10.4 billion MHz POPs, include licenses in the
United States which cover over 248 million persons, or POPs, in many of the
largest metropolitan areas in the country, nationwide licenses in Austria,
Croatia, Germany, Norway, Slovakia and Switzerland and significant spectrum
holdings in Canada.
Our mobile multimedia and wireless broadband products and technologies are
developed and marketed through our NextWave Network Products and NextWave Mobile
Products operating units. During the fourth quarter of 2007, we reorganized our
businesses into four reportable business segments on the basis of products,
services and strategic initiatives. The four business segments are:
Semiconductor, Multimedia, Networks, and Strategic Initiatives. The financial
results of NextWave Network Products and NextWave Mobile Products are reported
in the Semiconductor, Multimedia, and Networks business segments.
NextWave Network Products
NextWave Network Products ("NNP") includes the operations of IPWireless,
which was acquired in May 2007, and GO Networks, which was acquired in February
2007. NNP markets mobile broadband network equipment and mobile TV and
multimedia multicast systems, based on the global Universal Mobile
Telecommunications System ("UMTS") and Institute of Electrical and Electronics
Engineers ("IEEE") 802.11 standards, to mobile operators around the world. In
addition, NNP provides mobile operator customers with a comprehensive suite of
professional and value-added services. The financial results of NNP are reported
under our Network business segment.
Mobile Broadband Network Equipment. NNP mobile broadband network
equipment, based on the UMTS TD-CDMA standard, has been commercially deployed by
mobile operators in more than a dozen countries, including the Czech Republic,
Germany, New Zealand, South Africa, Sweden, United Kingdom and the United
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States. In 2006, NNP's UMTS TD-CDMA mobile broadband technology was selected by
New York City's Department of Information Technology and Telecommunications as
part of a five-year contract awarded to Northrop Grumman for the deployment of a
citywide, public-safety, mobile wireless network. To provide customers with an
evolution path to emerging 4G network technologies, in February 2008 NNP
announced its next-generation base station platform that will be field
upgradeable to support Worldwide Interoperability for Worldwide Access ("WiMAX")
and release 8 of the UMTS standard, also known as Long Term Evolution ("LTE").
Mobile TV and Multimedia Multicast Systems. We believe that our mobile TV
and multimedia multicast solutions will provide mobile operators an opportunity
to generate substantial incremental service and advertising revenues and
significantly improve the return on investment on their spectrum and network
infrastructure investments. Our advanced mobile TV systems are compatible with
both UMTS and WiMAX networks and are designed to allow mobile operators to offer
mobile TV services using their existing spectrum and existing radio access
network ("RAN") infrastructure.
NNP's TDtvTM mobile broadcast system, based on the Third Generation
Partnership Project ("3GPP") Multimedia Broadcast Multicast Service ("MBMS")
standard, provides UMTS operators with the ability to deliver multi-channel
mobile TV and other multimedia services using an underutilized portion of their
existing third generation ("3G") spectrum. Designed for easy integration into
existing Wideband Code Division Multiple Access ("WCMDA") networks and
next-generation WCMDA handsets, TDtv is being offered in combination with
MediaFusionTM, an advanced advertising platform developed by our PacketVideo
("PV") subsidiary, to provide operators the ability to generate targeted
advertising revenues from TDtv subscribers. On February 12, 2008, Orange and
T-Mobile announced that they will conduct a six month commercial pilot of TDtv
in London. We believe that this commercial pilot, along with the expected rapid
growth of the mobile TV market, will provide us with expanded opportunities to
market our TDtv multicast solution to UMTS network operators and device
manufacturers around the world.
NNP's MXtvTM mobile broadband system, announced in March 2008, is based on
the 802.16e WiMAX standard. We believe that MXtv will provide WiMAX operators
the ability to deliver a broad range of rich and personalized multimedia
services including mobile TV, interactive services, and digital audio without
having to invest in new spectrum or additional RAN infrastructure. Similar to
TDtv, MXtv will provide mobile operators the ability to use PV's MediaFusion
platform to generate revenues via the delivery of user-specific advertising. NNP
has executed joint development agreements with Huawei Technologies USA and
Alcatel-Lucent under which these two global network infrastructure providers
will integrate MXtv technology into their end-to-end WiMAX network solutions.
Carrier-Grade Mobile Wi-Fi Systems. NNP's family of carrier-class micro,
pico and femto mobile Wi-Fi base stations have been deployed by numerous mobile
operators, Internet Service Providers, and municipalities around the world.
NNP's Wi-Fi platforms utilize advanced xRFTM adaptive-beamforming, smart-antenna
technology and a cellular-mesh Wi-Fi architecture to deliver wide-area Wi-Fi
network solutions with the performance and economics required by service
providers. In February 2008, NNP announced its plan to integrate WiMAX and LTE
capabilities into its line of micro and pico base stations in order to provide
operators hybrid Wi-Fi/WiMAX and Wi-Fi/LTE network solutions.
Value-Added and Professional Services. To support sales of its mobile
broadband and multimedia systems, NNP provides its customers with a full array
of professional and value-added services, including RF and core network design
services, network implementation and management services, and back-office
service solutions, Voice-over-Internet-Protocol ("VoIP") implementation, and
wireless backhaul solutions. To demonstrate the capabilities of its products and
services, NNP has implemented a comprehensive test network in Las Vegas, Nevada.
NextWave Mobile Products.
NextWave Mobile Products ("NMP") includes the operations of our PV
subsidiary, the world's largest independent supplier of mobile multimedia
software solutions, and our Semiconductor business segment, which is developing
advanced wireless semiconductors including OFDM-based WiMAX and LTE chipsets.
Multimedia Software. Our PV subsidiary supplies device-embedded multimedia
software to many of the world's largest wireless carriers and wireless handset
manufacturers, who use it to transform a mobile phone into a feature-rich
multimedia device that provides people with the ability to stream, download and
play video and music, receive live TV broadcasts, and engage in two-way video
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telephony. PV has been contracted by some of the world's largest carriers, such
as Orange, NTT DoCoMo, T-Mobile, Verizon Wireless and Vodafone to design and
implement the embedded multimedia software capabilities contained in their
handsets. In addition, PV is a founding member of the Open Handset Alliance
("OHA"), led by Google, and will be supplying the multimedia software subsystem
for the OHA's mobile device AndroidTM platform. We believe that by joining the
OHA, PV will be uniquely positioned to market its full suite of enhanced
software applications to Android application developers. PV's software is
compatible with virtually all network technologies including CDMA, GSM, WiMAX,
LTE, and WCDMA. To date, over 200 million PV-powered handsets have been shipped
by PV's service provider and device manufacturer customers. The financial
results of our multimedia software business are reported under our Multimedia
business segment.
To further enhance its market position, PV has invested in the development
and acquisition of a wide range of technologies and capabilities to provide its
customers with software solutions to enable home/office digital media
convergence using communication protocols standardized by the Digital Living
Network AllianceTM ("DLNATM"). An example is the PVConnectTM platform that
provides for content search, discovery, organization and content
delivery/sharing between mobile devices and consumer electronics products
connected to an Internet Protocol ("IP")-based network. This innovative platform
is designed to provide an enhanced user experience by intelligently responding
to user preferences based on content type, day-part, and content storage
location. In addition, PV's patented Digital Rights Management ("DRM")
solutions, already in use by many wireless carriers globally, represent a key
enabler of digital media convergence by preventing the unauthorized access or
duplication of multimedia content used or shared by PV-enabled devices.
We believe that the continued growth in global shipments of high-end
handsets with multimedia capabilities, increasing demand for home/office digital
media convergence solutions, and the acceleration of global deployments of
mobile broadband networks optimized to support mobile multimedia applications
will substantially expand the opportunity for PV to license its suite of
multimedia software solutions to service providers and to handset and consumer
electronic device manufacturers.
Multimedia Devices. To help drive market adoption of mobile TV technology
and related PV products, PV recently introduced its Mobile Broadcast Receiver, a
matchbox-size hardware device that enables virtually any mobile Wi-Fi device to
play mobile broadcast TV. The mobile receiver decodes a digital TV signal,
repurposes it for use on a mobile device, and then sends the mobile TV content
over Wi-Fi to the handset. The PV receiver uses patented protocols to ensure
optimum rendering of the TV signal on the playback device and provides secure
access to premium channels. This allows mobile subscribers to upgrade to
advanced mobile TV services without having to change their handsets. PV intends
to manufacture several versions of the Mobile Broadcast Receiver to support
TDtv, MXtv, Digital Video Broadcasting - Handheld ("DVB-H"), and MediaFLO mobile
TV systems. The financial results of our multimedia device business are reported
under our Multimedia business segment.
Semiconductors. Over 596 engineers at NMP are developing a family of
mobile broadband semiconductor products based on OFDM technologies such as WiMAX
and LTE. NMP's initial focus is to market multi-band RF chips and
high-performance, digital baseband WiMAX chips to wireless device and network
equipment manufacturers who require an advanced platform to develop
next-generation WiMAX mobile terminal and infrastructure products optimized for
mobile multimedia applications such as mobile TV. Samples of our
first-generation NW1000 chipset family, which includes a WiMAX baseband
system-on-a-chip ("SOC") and matched multi-band Radio Frequency Integrated
Circuits ("RFIC"), became available in the third quarter of 2007. Initial
availability of our second-generation NW2000 chipset family, which will contain
our MXtv mobile multicast technology, is planned for the first half of 2008. The
NW2000 chipset family will be NMP's first chipset family designed for
high-volume commercial production. In addition, NMP is developing a family of
handset and media player reference designs to highlight the features of its
subscriber station semiconductor products. Furthermore, in advance of
prospective commercial deployments by network operators of NNP's TDtv mobile
broadcast system, NNP is preparing for high-volume, commercial production of a
TDtv Device Integration Pack ("DIP"). The TDtv DIP which includes a low-power
TDtv System in Package ("SiP"), a complete MBMS software stack, and PV
MediaFusion multimedia client software, is designed to provide device vendors an
easy, low-cost way to integrate TDtv technology into their handset products. The
financial results of our semiconductor business are reported under our
Semiconductor business segment.
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The primary design objectives of NMP's current and future semiconductor
products and technologies, which are intended to be sold or licensed to network
infrastructure vendors, device manufacturers and service providers worldwide,
are to:
o Improve the performance, service quality, and economics of mobile
broadband networks and enhance their ability to cost-effectively
handle the large volume of network traffic associated with
bandwidth-intensive and/or Quality of Service ("QoS"), applications
such as mobile TV, VOD, streaming audio, two-way video telephony,
VoIP telephony, and real-time interactive gaming;
o Improve the performance, power consumption and cost characteristics
of WiMAX and LTE subscriber terminals;
o Improve the degree of interoperability and integration between Wi-Fi
and WiMAX/LTE systems for both Local Area Networks ("LANs") and Wide
Area Networks ("WANs"); and
o Improve service provider economics and roaming capabilities by
enabling WiMAX and LTE enabled devices to seamlessly operate across
multiple frequency bands including certain unlicensed bands.
Strategic Initiatives
To help drive sales of our products and technologies, we have acquired
licensed spectrum in the United States, Canada, Germany, Switzerland, Norway,
Austria, Slovakia and Croatia. We believe that our spectrum will create
additional opportunities to sell our products and services to service providers
who require our spectrum assets to offer mobile multimedia and wireless
broadband services and that these opportunities may be of significant scale. The
financial results of our spectrum acquisition activities, both domestically and
internationally, are reported under our Strategic Initiatives business segment.
To date, we have acquired licensed spectrum and entered into long-term
leases that provide us with exclusive leasehold access to licensed spectrum
throughout the United States. Our spectrum portfolio covers approximately 248.9
million POPs across the United States, of which licenses covering 136.4 million
POPs are covered by 20 MHz or more of spectrum, and licenses covering an
additional 98.7 million POPs are covered by at least 10 MHz of spectrum. In
addition, a number of markets, including much of the New York metropolitan
region, are covered by 30 MHz or more of spectrum. While we believe that all of
our spectrum assets can support commercially viable wireless broadband services,
we expect that those licenses which have over 20 MHz of spectrum will provide
operators with improved capacity and network performance. We believe that this
spectrum footprint, which includes 15 of the top 20 Cellular Market Areas
("CMAs") and eight of the top ten CMAs in the United States, will be attractive
to service providers who wish to deploy wireless networks that utilize our
advanced products and technologies. Our domestic spectrum resides in the 2.3 GHz
Wireless Communication Services ("WCS"), 2.5 GHz Broadband Radio Service
("BRS")/Educational Broadband Service ("EBS"), and 1.7/2.1 GHz Advanced Wireless
Services ("AWS") bands and offers propagation and other characteristics suitable
to support high-capacity, mobile broadband services.
We believe the breadth of products, technologies, spectrum assets and
professional services we offer represents a unique platform to provide advanced
mobile multimedia and wireless broadband solutions to the market. We believe
that they will provide synergistic value to each other and collectively drive
accelerated market penetration and share of the rapidly growing mobile
multimedia and wireless broadband market.
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THE OFFERING
Common stock outstanding prior 92,713,778
to this shares offering,
excluding the shares being
offered for resale to the public
by the selling stockholders(1)
Common stock being offered for resale 9,101,718 shares
to the public by the selling
stockholders(2)
Common stock to be outstanding after 101,815,496 shares
this offering
Total proceeds raised by offering We will not receive any proceeds from
the resale of our common stock
pursuant to this offering.
Nasdaq Global Market symbol WAVE
Risk factors See "Risk Factors" and the other
information included in this
prospectus for a discussion of risk
factors you should carefully consider
before deciding to invest in our
common stock.
(1) The number of shares of our common stock outstanding prior to this
offering is based on the number of shares of our common stock outstanding
as of March 10, 2008. This number does not include, as of March 10, 2008:
o 23,528,911 shares of our common stock issuable upon exercise
of options and warrants outstanding, at a weighted average
exercise price of $7.08 per share , of which amount 500,000
are shares of our common stock issuable upon exercise of
warrants at an exercise price of $6.00 per share and 1,935,000
are shares of our common stock issuable upon the exercise of
warrants at an exercise price of $0.01 per share;
o 15,319,383 shares of our common stock reserved for issuance
under our NextWave Wireless Inc. 2005 Stock Incentive Plan,
NextWave Wireless Inc. 2007 Stock Incentive Plan, the CYGNUS
Communications, Inc. 2004 Stock Option Plan and the
PacketVideo Corporation 2005 Equity Incentive Plan;
o approximately $7.0 million of our common stock that may be
issued under the IPWireless Employee Stock Bonus Plan upon the
achievement of certain milestones relating to product
shipments and up to $5.0 million of our common stock that may
be issued under the GO Networks Employee Stock Bonus Plan upon
the achievement of certain milestones relating to product
shipments;
o 33,996,100 shares of our common stock issuable upon conversion
of our Series A Preferred Stock; and
o 833,333 shares of common stock issuable under an advisory
contract.
(2) The number of shares of our common stock being offered for resale includes
3,417,299 shares subject to escrow arrangements until May 11, 2008, which
shares will be subject to forfeiture if we incur certain losses which are
indemnifiable under the IPWireless Merger Agreement, including any losses
we may incur as a result of any breach of the representations and
warranties or covenants of IPWireless contained in our merger agreement
with IPWireless.
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RISK FACTORS
Our business involves a high degree of risk. You should carefully consider
the following risks together with all of the other information contained in or
incorporated by reference into this registration statement before making a
future investment decision with respect to our securities. If any of the
following risks actually occurs, our business, financial condition and results
of operations could be materially adversely affected, and the value of our
securities could decline.
RISKS RELATING TO OUR BUSINESS
WE HAVE LIMITED RELEVANT OPERATING HISTORY AND A HISTORY OF LOSSES.
We emerged from our reorganization in April 2005 with a new business plan
and have made several significant acquisitions and investments. As a result, we
are at an early stage of our development and have had a limited relevant
operating history and, consequently, limited historical financial information.
Other than through our PacketVideo subsidiary, which we acquired in July 2005,
and our IPWireless subsidiary, which we acquired in May 2007, we have never
generated any material revenues and have limited commercial operations. While
certain of our businesses are currently generating revenues, the revenues are
not yet adequate to cover our operating expenses. In particular, we are
currently unable to project when our semiconductor products and technologies
will be commercially deployed and generating significant revenue. We, along with
the companies we have acquired, have a history of losses. We will continue to
incur significant expenses in advance of achieving broader commercial
distribution of our network equipment products and generating revenues from our
semiconductor business. We are expected to realize significant operating losses
for the next few years. We are therefore subject to risks typically associated
with a start-up entity.
If we are not able to successfully implement all key aspects of our
business plan, including selling and/or licensing high volumes of our products
to network operators and to device and network equipment manufacturers, we may
not be able to develop a customer base sufficient to generate adequate revenues.
If we are unable to successfully implement our business plan and grow our
business, either as a result of the risks identified in this section or for any
other reason, we may never achieve profitability, in which event our business
would fail.
IF WE FAIL TO EFFECTIVELY MANAGE GROWTH IN OUR BUSINESS, OUR ABILITY TO
DEVELOP AND COMMERCIALIZE OUR PRODUCTS WILL BE ADVERSELY AFFECTED.
Our business and operations have expanded rapidly since the completion of
our reorganization in April 2005. For example, from April 13, 2005 through
December 29, 2007, the number of our employees increased from 50 to 1,105 as a
result of organic growth and acquisitions. In addition to various immaterial
acquisitions in 2007 and 2006, we acquired WiMax Telecom AG in December 2007
(following our purchase of a majority-owned share in July 2007), Websky
Argentina S.A. in October 2007, IPWireless, Inc. in May 2007, GO Networks, Inc.
in February 2007, SDC Secure Digital Container AG ("SDC") in January 2007,
CYGNUS Communications, Inc. in February 2006 and PacketVideo Corporation in July
2005.
To support our expanded research and development activities and the
anticipated growth in our NextWave Network Products and NextWave Mobile Products
businesses, we must continue to successfully hire, train, motivate and retain
our employees. We expect that further expansion of our operations and employee
base will be necessary. Our recent acquisitions have also expanded the
geographic reach of our operations to countries including Argentina, Austria,
Croatia, Denmark, Finland Germany, Israel, Slovakia, South Korea, Switzerland
and the United Kingdom. In order to manage the increased complexity of our
expanded operations, we will need to continue to expand our management,
operational and financial controls and strengthen our reporting systems and
procedures. All of these measures will require significant expenditures and will
demand the attention of management. Failure to fulfill any of the foregoing
requirements could result in our failure to successfully manage our intended
growth and development, and successfully integrate our acquired businesses,
which would adversely affect our ability to develop and commercialize our
products and achieve profitability.
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WE HAVE RECENTLY ACQUIRED PRIVATE COMPANIES THAT WERE NOT SUBJECT TO
SARBANES-OXLEY REGULATIONS AND, THEREFORE, THEY MAY LACK THE INTERNAL controls
OF A PUBLIC COMPANY, WHICH COULD ULTIMATELY AFFECT OUR ABILITY TO ENSURE
COMPLIANCE WITH THE REQUIREMENTS OF SECTION 404 OF THE SARBANES-OXLEY ACT.
We have recently acquired private companies that were not previously
subject to Sarbanes Oxley regulations and accordingly were not required to
establish and maintain an internal control infrastructure meeting the standards
promulgated under the Sarbanes-Oxley Act of 2002. Our assessment of and
conclusion on the effectiveness of the Company's internal control over financial
reporting as of December 29, 2007 did not include the internal controls of the
recent acquisitions of SDC Secure Digital Container AG, acquired in January
2007, GO Networks, Inc., acquired in February 2007, IPWireless, Inc., acquired
in May 2007, WiMax Telecom AG, acquired in July 2007, Digital World Services AG,
acquired in September 2007, and Websky Argentina SA, acquired in October 2007,
which are included in our 2007 consolidated financial statements and constituted
$64.3 million and $97.9 million of total assets (excluding wireless spectrum
licenses, goodwill and other intangible assets) and total liabilities (excluding
deferred tax liabilities related to wireless spectrum licenses), respectively,
as of December 29, 2007 and $24.7 million and $94.1 million of total revenues
and operating loss, respectively, for the fiscal year then ended. Management did
not assess the effectiveness of internal control over financial reporting at the
entities listed above because we did not have the ability to assess those
controls due to the timing of the acquisitions.
We continue to evaluate and integrate these acquired entities into our
existing internal control structure. In connection with our financial statement
close process for the fiscal year ended December 29, 2007 and our acquisition
integration efforts, we identified several control deficiencies at a company we
acquired in 2007 whose operations are primarily foreign. Specifically, there
were deficiencies in information technology general controls and the
availability of a sufficiently trained workforce in the accounting organization.
Ernst & Young LLP, in connection with their audit for the year ended December
29, 2007, also identified control deficiencies in the revenue recognition and
financial statement close processes at this same acquired company. These
deficiencies could rise to the level of one or more material weaknesses once the
evaluation of these controls has been completed. We are in the process of
implementing a number of measures to remedy these deficiencies including the
implementation of our accounting and enterprise resource planning system. We
believe the new controls and procedures will address the deficiencies
identified. The evaluation of these controls is expected to be included in our
report on internal control over financial reporting for the year ending December
27, 2008. We plan to continue to monitor the effectiveness of the acquired
company's controls, including the operating effectiveness of the newly
implemented measures and plan to take further action, as appropriate.
Although our management will continue to review and evaluate the
effectiveness of our internal controls in light of these acquisitions, we can
give you no assurance that there will be no material weaknesses in our internal
control over financial reporting. Any significant deficiencies or material
weaknesses in the internal control structure of our acquired businesses may
cause significant deficiencies or material weaknesses in our internal control
over financial reporting, which could have a material adverse effect on our
business and our ability to comply with Section 404 of the Sarbanes-Oxley Act.
WE MAY NEED TO SECURE SIGNIFICANT ADDITIONAL CAPITAL IN THE FUTURE TO
IMPLEMENT OUR BUSINESS PLAN AND TO CONTINUE TO FUND OUR RESEARCH AND DEVELOPMENT
ACTIVITIES AND OUR OPERATING LOSSES UNTIL WE BECOME CASH FLOW POSITIVE AND
GENERATE EARNINGS.
We may need to secure significant additional capital in the future to
implement our business plan and to continue to fund our research and development
activities and our operating losses until we become cash flow positive and
generate earnings.
Based on the operating plan for the year ended December 27, 2008 approved
by our board of directors, management believes our existing cash, cash
equivalent and marketable securities, the release of the $75 million of
restricted cash based on the First Amendment to the Purchase Agreement for our
7% Senior Notes and cash forecasted to be generated by operations will be
sufficient to meet the our estimated working capital and capital expenditures
requirements through at least March 2009. The achievement of our operating plan
is dependent in part upon achieving revenue from new customer relationships that
we are seeking to develop. Unexpected expenses and delays in development of our
products and technologies, or delays in the adoption of WiMAX and other 4G
technologies by national telecommunications carriers and equipment
manufacturers, could adversely affect our liquidity.
7
In order for us to achieve positive operating results and positive cash
flows, we will need to achieve a substantial increase in the level of revenues
and achieve sufficient gross margins to cover our ongoing operating expenses and
debt service costs. If events or circumstances occur such that we do not meet
our operating plan as expected, we may be required to seek additional capital
and /or reduce certain discretionary spending, which could have a material
adverse effect on our ability to achieve our intended business objectives.
To augment our existing working capital resources in order to satisfy our
cash requirements, we may seek to sell debt baskets and securities or additional
equity securities or to obtain a credit facility. Our Senior Secured Notes and
our Series A Preferred Stock prohibit our incurrence of additional indebtedness,
subject to certain exceptions. The sale of equity securities or convertible debt
securities could result in additional dilution to our stockholders. The
incurrence of additional indebtedness would also result in additional debt
service obligations and the requirement that we comply with operating and
financial covenants that would restrict our operations. In addition, there can
be no assurance that any additional financing will be available on acceptable
terms, if at all.
WE OPERATE IN AN EXTREMELY COMPETITIVE ENVIRONMENT WHICH COULD MATERIALLY
ADVERSELY AFFECT OUR ABILITY TO WIN MARKET ACCEPTANCE OF OUR PRODUCTS AND
ACHIEVE PROFITABILITY.
We operate in an extremely competitive market and we expect such
competition to increase in the future. Our network products and semiconductor
businesses are developing and selling products and technologies based on WiMAX,
Wi-Fi and UMTS standards and will be competing with well established,
international companies that are engaged in the development, manufacture and
sale of products and technologies that support the same technologies, as well as
alternative wireless standards such as High Speed Downlink Packet Access
("HSDPA") and Ultra Mobile Broadband ("UMB"). Companies that support these
alternative wireless technologies include well established industry leaders such
as Alcatel, Ericsson, Lucent, Motorola, Nokia, Nortel, QUALCOMM, Samsung and
Siemens.
Our mobile TV products, such as TDtv and MXtv, compete with alternative
mobile broadcast technologies such as DVB-H and MediaFlo. These alternative
technologies have already been commercially deployed by network operators in the
United States and internationally and are supported by well-established industry
leaders such as Alcatel, Ericsson, Nokia and QUALCOMM, all of which have
significantly greater financial, technological development, marketing and other
resources than we do.
We also will be competing with numerous companies that are currently
developing or marketing WiMAX products and technologies including Airspan,
Beceem, Fujitsu, Intel, Motorola, Nortel, RunCom, Samsung, Sequans and WaveSat.
Some of these companies have significantly greater financial, technical
development, and marketing resources than we do, are already marketing
fully-commercial WiMAX semiconductor products, and have established a
significant time to market advantage. Some of these companies are also our
potential customers and partners and may not be available to us if they develop
competing products.
Our NextWave Multimedia business products compete primarily with the
internal multimedia design teams at the OEM handset manufacturers to whom we
market our products and services. Importantly, these OEMs represent some of our
largest customers. In addition several companies, including Flextronics/Emuzed,
Hantro, Nextreaming, Philips Software, Sasken and Thin Multimedia also currently
provide software products and services that directly or indirectly compete with
our PacketVideo products and our TDtv solution. As the market for embedded
multimedia software evolves, we anticipate that additional competitors may
emerge including Apple Computer, Real Networks and OpenWave.
Our ability to generate earnings will depend, in part, upon our ability to
effectively compete with these competitors.
THE SUCCESS OF OUR BUSINESSES DEPENDS ON THE ADOPTION OF DEVELOPING
WIRELESS BROADBAND 4G TECHNOLOGIES, INCLUDING WIMAX AND TD-CDMA.
The success of our semiconductor business depends on the deployment and
market acceptance of 4G wireless broadband technologies, including WiMAX and
LTE. The market for 4G networks and compatible products and technologies, as
well as the technologies themselves, are in an early stage of development and
are continuing to evolve. In particular, there are currently no mobile WiMAX or
LTE networks in commercial operation and there can be no assurance that
commercial mobile WiMAX or LTE networks will prove to be commercially viable. In
order for 4G technologies to gain significant market acceptance among customers,
network operators and telecommunications service providers will need to deploy
4G networks. However, many of the largest wireless telecommunications providers
8
have made significant expenditures in incumbent technologies and may choose to
develop these technologies rather than utilize 4G technologies. Certification
standards for 4G technologies are controlled by industry groups. Accordingly,
standard setting for 4G technologies is beyond our control. If standards for 4G
technologies such as WiMAX, LTE, and TD-CDMA, for example, change, the
commercial viability of these technologies may be delayed or impaired and our
development efforts may also be delayed or impaired or become more costly. If
our 4G technologies and products do not receive industry certification, we may
not be able to successfully market, license or sell our products or
technologies. The development of 4G networks is also dependent on the
availability of spectrum. Access to spectrum suitable for 4G networks is highly
competitive. Future 4G networks may utilize multiple frequencies and this
multi-spectrum approach is technologically challenging and will require the
development of new software, integrated circuits and equipment, which will be
time consuming and expensive and may not be successful. In order for our
business to continue to grow and to become profitable, 4G technology and related
services must gain acceptance among consumers, who tend to be less technically
knowledgeable and more resistant to new technology or unfamiliar services. If
consumers choose not to adopt 4G technologies, we will not be successful in
selling 4G products and technologies and our ability to grow our business will
be limited.
MANY OF OUR PRODUCTS AND TECHNOLOGIES ARE IN THE EARLY STAGES OF
DEVELOPMENT AND WILL REQUIRE A SUBSTANTIAL INVESTMENT BEFORE THEY MAY BECOME
COMMERCIALLY VIABLE.
Many of our wireless broadband products and technologies are in the early
stages of development and will require a substantial investment before they may
become commercially viable. While we have announced the initial availability of
our first generation WiMAX baseband system-on-a-chip and matched multiband RFIC,
these products are not expected to generate significant revenue. We currently
anticipate that our second generation WiMAX chipset, designed for high volume
commercial production, will initially be available in the first half of 2008. In
addition, we anticipate that our TDtv products will also become fully
commercially available in 2008. However, we may not able to meet these
timeframes and therefore the commercial deployment of these products could be
delayed, which could adversely affect our competitive position as well as our
future profitability. In addition, unexpected expenses and delays in development
could adversely affect our liquidity. Some of our other planned wireless
broadband products and technologies have not been tested, even on a
pre-commercial basis. Even if our new products and technologies function when
tested, they may not produce sufficient performance and economic benefits to
justify full commercial development efforts, or to ultimately attract customers.
Failure to achieve high volume sales of our semiconductors and other wireless
broadband products and technologies would adversely affect our ability to
achieve profitability.
OUR CUSTOMER AGREEMENTS DO NOT CONTAIN MINIMUM PURCHASE REQUIREMENTS AND
CAN BE CANCELLED ON TERMS THAT ARE NOT BENEFICIAL TO US.
Our customer agreements with network providers and mobile phone and device
manufacturers are not exclusive and many contain no minimum purchase
requirements or flexible pricing terms. Accordingly, mobile phone and device
manufacturers may effectively terminate these agreements by no longer purchasing
our products or reducing the economic benefits of those arrangements. In many
circumstances, we have indemnified these customers from certain claims that our
products and technologies infringes third-party intellectual property rights.
Our customer agreements are generally not exclusive and have a limited term of
one to five years, in some cases with evergreen, or automatic renewal,
provisions upon expiration of the initial term. These agreements set out the
terms of our distribution relationships with the customers but generally do not
obligate the customers to market or distribute any of our products or
applications. In addition, in some cases customers can terminate these
agreements early or at any time, without cause.
WE MAY EXPERIENCE DIFFICULTIES IN THE INTRODUCTION OF NEW OR ENHANCED
PRODUCTS, WHICH COULD RESULT IN REDUCED SALES, UNEXPECTED EXPENSES OR DELAYS IN
THE LAUNCH OF NEW OR ENHANCED PRODUCTS AND IN CERTAIN CASES, PENALTIES UNDER
CUSTOMER AGREEMENTS.
The development of new or enhanced wireless products and technologies is a
complex and uncertain process. We may experience design, manufacturing,
marketing and other difficulties that could delay or prevent our development,
introduction, commercialization or marketing of new products or product
enhancements. The difficulties could result in reduced sales, unexpected
expenses or delays in the launch of new or enhanced products, which may
adversely affect our results or operations. In addition, in some cases we are
required to provide liquidated damages and other penalty clauses in our customer
contracts (for e.g., late delivered product, failure to comply with service
9
level agreements or defective products). If we are unable to perform in a timely
manner under such customer agreements, we would face financial penalties.
WE DO NOT HAVE ANY MANUFACTURING CAPABILITIES AND DEPEND ON THIRD-PARTY
MANUFACTURERS AND SUPPLIERS TO MANUFACTURE, ASSEMBLE AND PACKAGE OUR products.
We are currently designing and developing semiconductor products including
digital baseband ASICs and multi-band RFICs. If we are successful in our design
and development activities and a market for these products develops, these
products will need to be manufactured. Due to the expense and complexity
associated with the manufacturer of digital baseband ASICs and multi-band RFICs,
we intend to depend on third-party manufacturers to manufacture these products.
In addition, we have engaged third-party manufacturers to develop and
manufacture its products and technologies including infrastructure equipment and
end-user devices. The dependence on third-parties to manufacture, assemble and
package these products involves a number of risks, including:
o a potential lack of capacity to meet demand;
o reduced control over quality and delivery schedules;
o risks of inadequate manufacturing yield or excessive costs;
o difficulties in selecting and integrating subcontractors;
o limited warranties in products supplied to us;
o price increases; and
o potential misappropriation of our intellectual property.
We may not be able to establish manufacturing relationships on reasonable
terms or at all. The failure to establish these relationships on a timely basis
and on attractive terms could delay our ability to launch these products or
reduce our revenues and profitability.
DEFECTS OR ERRORS IN OUR PRODUCTS AND SERVICES OR IN PRODUCTS MADE BY OUR
SUPPLIERS COULD HARM OUR RELATIONS WITH OUR CUSTOMERS AND EXPOSE US TO
LIABILITY. SIMILAR PROBLEMS RELATED TO THE PRODUCTS OF OUR CUSTOMERS OR
LICENSEES COULD HARM OUR BUSINESS.
Our mobile broadband products and technologies are inherently complex and
may contain defects and errors that are detected only when the products are in
use. Further, because our products and technologies serve as critical functions
in our customers' products and/or networks, such defects or errors could have a
serious impact on our customers, which could damage our reputation, harm our
customer relationships and expose us to liability. Defects in our products and
technologies or those used by our customers or licensees, equipment failures or
other difficulties could adversely affect our ability and that of our customers
and licensees to ship products on a timely basis as well as customer or licensee
demand for our products. Any such shipment delays or declines in demand could
reduce our revenues and harm our ability to achieve or sustain desired levels of
profitability. We and our customers or licensees may also experience component
or software failures or defects which could require significant product recalls,
reworks and/or repairs which are not covered by warranty reserves and which
could consume a substantial portion of the capacity of our third-party
manufacturers or those of our customers or licensees. Resolving any defect or
failure related issues could consume financial and/or engineering resources that
could affect future product release schedules. Additionally, a defect or failure
in our products and technologies or the products of our customers or licensees
could harm our reputation and/or adversely affect the growth of the market for
mobile WiMAX, Wi-Fi, TD-CDMA, and other mobile broadband technologies.
WE MAY BE UNABLE TO PROTECT OUR OWN INTELLECTUAL PROPERTY AND COULD BECOME
SUBJECT TO CLAIMS OF INFRINGEMENT, WHICH COULD ADVERSELY AFFECT THE VALUE OF OUR
PRODUCTS AND TECHNOLOGIES AND HARM OUR REPUTATION.
As a technology company, we expect to incur expenditures to create and
protect our intellectual property and, possibly, to assert infringement by
others of our intellectual property. Other companies or entities also may
commence actions or respond to an infringement action that we initiate by
seeking to establish the invalidity or unenforceability of one or more of our
patents or to dispute the patentability of one or more of our pending patent
applications. In the event that one or more of our patents or applications are
challenged, a court may invalidate the patent or determine that the patent is
10
not enforceable or deny issuance of the application, which could harm our
competitive position. If any of our patent claims are invalidated or deemed
unenforceable, or if the scope of the claims in any of these patents is limited
by court decision, we could be prevented from licensing such patent claims. Even
if such a patent challenge is not successful, it could be expensive and time
consuming to address, divert management attention from our business and harm our
reputation. Effective intellectual property protection may be unavailable or
limited in certain foreign jurisdictions.
We also expect to incur expenditures to defend against claims by other
persons asserting that the technology that is used and sold by us infringes upon
the right of such other persons. From time to time, we have received, and expect
to continue to receive, notices from our competitors and others claiming that
their proprietary technology is essential to our products and seeking the
payment of a license fee. Any claims, with or without merit, could be time
consuming to address, result in costly litigation and/or the payment of license
fees, divert the efforts of our technical and management personnel or cause
product release or shipment delays, any of which could have a material adverse
effect upon our ability to commercially launch our products and technologies and
on our ability to achieve profitability. If any of our products were found to
infringe on another company's intellectual property rights or if we were found
to have misappropriated technology, we could be required to redesign our
products or license such rights and/or pay damages or other compensation to such
other company. If we were unable to redesign our products or license such
intellectual property rights used in our products, we could be prohibited from
making and selling such products. In any potential dispute involving other
companies' patents or other intellectual property, our customers and partners
could also become the targets of litigation. Any such litigation could severely
disrupt the business of our customers and partners, which in turn could hurt our
relations with them and cause our revenues to decrease.
BECAUSE MOBILE WIMAX AND 3GPP BASED TECHNOLOGIES SUCH AS LTE ARE EMERGING
WIRELESS TECHNOLOGIES THAT ARE NOT FULLY DEVELOPED, THERE IS A RISK THAT STILL
UNKNOWN PERSONS OR COMPANIES MAY ASSERT PROPRIETARY RIGHTS TO THE VARIOUS
TECHNOLOGY COMPONENTS THAT WILL BE NECESSARY TO OPERATE A WIMAX OR LTE-BASED
WIRELESS BROADBAND NETWORK.
Because mobile technologies such as WiMAX and LTE are emerging wireless
technologies that are not fully developed, there may be a greater risk that
persons or entities unknown to us will assert proprietary rights to technology
components that are necessary to operate WiMAX or LTE-based wireless broadband
networks or products. Numerous companies have submitted letters of assurance
related to IEEE 802.16 and amendments or various UMTS based technologies,
including TD-CDMA, stating that they may hold or control patents or patent
applications, the use of which would be unavoidable to create a compliant
implementation of either mandatory or optional portions of the standard. In such
letters, the patent holder typically asserts that it is prepared to grant a
license to its essential IP to an unrestricted number of applicants on a
worldwide, non-discriminatory basis and on reasonable terms and conditions. If
any companies asserting that they hold or control patents or patent applications
necessary to implement the relevant technologies do not submit letters of
assurance, or state in such letters that they do not expect to grant licenses,
this could have an adverse effect on the implementation of mobile broadband
networks utilizing such technologies as well as the sale of our mobile WiMAX or
future LTE based products and technologies. In addition, we can not be certain
of the validity of the patents or patent applications asserted in the letters of
assurance submitted to date, or the terms of any licenses which may be demanded
by the holders of such patents or patent applications. If we were required to
pay substantial license fees to implement our mobile WiMAX or LTE-based products
and technologies, this could adversely affect the profitability of these
products and technologies.
We anticipate that we will develop a patent portfolio related to our WiMAX
and LTE based products and technologies. However, there is no assurance that we
will be able to obtain patents covering WiMAX or LTE based products. Litigation
may be required to enforce or protect our intellectual property rights. As a
result of any such litigation, we could lose our proprietary rights or incur
substantial unexpected operating costs. Any action we take to license, protect
or enforce our intellectual property rights could be costly and could absorb
significant management time and attention, which, in turn, could negatively
impact our operating results. In addition, failure to protect our trademark
rights could impair our brand identity.
WE ARE SUBJECT TO RISKS ASSOCIATED WITH OUR INTERNATIONAL OPERATIONS.
We operate or hold spectrum through various subsidiaries and joint
ventures in Argentina, Austria, Canada, Croatia, Germany, Norway, Slovakia and
Switzerland and have additional operations located in Brazil, Denmark, Finland,
11
Germany, Israel, South Korea, Switzerland and the United Kingdom. We expect to
continue to expand our international operations and potentially enter new
international markets through acquisitions, joint ventures and strategic
alliances. For example, we recently commenced business operations in Latin
America, where a new business unit headquartered in Sao Paulo, Brazil will
deliver our mobile broadband and wireless technology solutions to customers
throughout the Latin American region. Our activities outside the United States
operate in different competitive and regulatory environments than we face in the
United States, with many of our competitors having a dominant incumbent market
position and/or greater operating experience in the specific geographic market.
In addition, in some international markets, foreign governmental authorities may
own or control the incumbent telecommunications companies operating under their
jurisdiction. Established relationships between government-owned or
government-controlled telecommunications companies and their traditional local
telecommunications providers often limit access of third parties to these
markets. In addition, owning and operating wireless spectrum in overseas
jurisdictions may be subject to a changing regulatory environment. In
particular, our ownership of wireless broadband spectrum in Argentina remains
subject to obtaining governmental approval. We can not assure you that changes
in foreign regulatory guidelines for the issuance or use of wireless licenses,
foreign ownership of spectrum licenses, the adoption of wireless standards or
the enforcement and licensing of intellectual property rights will not adversely
impact our operating results. Due to these competitive and regulatory
challenges, our activities outside the United States may require a
disproportionate amount of our management and financial resources, which could
disrupt our operations and adversely affect our business.
OUR BUSINESSES WHICH CURRENTLY GENERATE REVENUE ARE DEPENDENT ON A LIMITED
NUMBER OF CUSTOMERS.
Our NextWave Network Products and NextWave Mobile Products businesses
currently generate revenue but are dependent on a limited number of customers.
For the year ended December 29, 2007, revenues from three customers accounted
for 39%, 18% and 11% of our consolidated revenues, respectively. We expect that
our NextWave Multimedia business will continue to generate a significant portion
of its revenues through a limited number of mobile phone and device
manufacturers and wireless carriers for the foreseeable future, although these
amounts may vary from period-to-period. If any of these customers terminate
their relationships with us, our revenues and results of operations could be
materially adversely affected.
WE ARE DEPENDENT ON A SMALL NUMBER OF INDIVIDUALS, AND IF WE LOSE KEY
PERSONNEL UPON WHOM WE ARE DEPENDENT, OUR BUSINESS WILL BE ADVERSELY affected.
Our future success depends largely upon the continued service of our board
members, executive officers and other key management and technical personnel,
particularly Allen Salmasi, Chairman and Chief Executive Officer, William Jones,
Chief Executive Officer of our NNP operating unit, and James Brailean, Chief
Executive Officer of our NMP operating unit.
Mr. Salmasi has been a prominent executive and investor in the technology
industry for over 20 years, and the Company has benefited from his industry
relationships in attracting key personnel and in implementing acquisitions and
strategic plans. In addition, in order to develop and achieve commercial
deployment of our mobile broadband products and technologies in competition with
well-established companies such as Intel, QUALCOMM and others, we must rely on
highly specialized engineering and other talent. Our key employees represent a
significant asset, and the competition for these employees is intense in the
wireless communications industry. We continue to anticipate significant
increases in human resources, particularly in engineering resources, through
2008. If we are unable to attract and retain the qualified employees that we
need, our business may be harmed.
As a company without a significant operating history, we may have
particular difficulty attracting and retaining key personnel in periods of poor
operating performance given the significant use of incentive compensation by
well-established competitors. We do not maintain key person life insurance on
any of our personnel. We also have no covenants against competition or
nonsolicitation agreements with certain of our key employees. The loss of one or
more of our key employees or our inability to attract, retain and motivate
qualified personnel could negatively impact our ability to design, develop and
commercialize our products and technology.
To augment our existing working capital resources in order to satisfy our
cash requirements, we may seek to sell debt securities or additional equity
securities or to obtain a credit facility. Our Senior Secured Notes and our
Series A Preferred Stock prohibit our incurrence of additional indebtedness,
subject to certain exceptions. The sale of equity securities or convertible debt
securities could result in additional dilution to our stockholders. The
incurrence of additional indebtedness would also result in additional debt
service obligations and the requirement that we comply with operating and
12
financial covenants that would restrict our operations. In addition, there can
be no assurance that any additional financing will be available on acceptable
terms, if at all.
COVENANTS IN THE INDENTURE GOVERNING OUR SENIOR SECURED NOTES AND THE
TERMS OF OUR SERIES A PREFERRED STOCK IMPOSE OPERATING AND FINANCIAL
RESTRICTIONS ON US.
Covenants in the indenture governing our Senior Secured Notes and the
terms of our Series A Preferred Stock impose operating and financial
restrictions on us. These restrictions prohibit or limit our ability, and the
ability of our subsidiaries, to, among other things; ?
o pay dividends to our stockholders; ?
o incur, or cause certain of our subsidiaries to incur, additional
indebtedness;
o permit liens on or conduct sales of any assets pledged as
collateral;
o sell significant amounts of our assets or consolidate or merge
with or into other companies;
o issue shares of our common stock at less than fair market value;
o repay existing indebtedness; and
o engage in transactions with affiliates.
A breach of any covenants contained in the indenture could result in a
default under our Senior Secured Notes. If we are unable to repay or refinance
those amounts, the holders of our Senior Secured Notes could proceed against the
assets pledged to secure these obligations, which include a substantial portion
of our spectrum assets and substantially all of our other assets.
These restrictions may limit our ability to obtain additional financing,
withstand downturns in our business and take advantage of business
opportunities. Moreover, we may seek additional debt financing on terms that
include more restrictive covenants, may require repayment on an accelerated
schedule or may impose other obligations that limit our ability to grow our
business, acquire needed assets, or take other actions we might otherwise
consider appropriate or desirable.
CERTAIN OF OUR WORKABLE SECURITIES RECENTLY FAILED TO TRADE AT AUCTIONS,
WHICH MAY RESULT IN FUTURE IMPAIRMENT CHARGES TO A PORTION OF ALL OF SUCH
INVESTMENTS.
As of December 29, 2007, $102.2 million of our marketable securities were
invested in auction rate securities ("ARS"). None of the auctions involving our
ARS holdings had failed as of December 29, 2007. Through March 21, 2008,
auctions for eight ARS, including certain municipalities and education auction
rate securities, with principal amounts aggregating $29.5 million, were not
successful due to recent weakness in the auction markets. The unsuccessful
securities are District of Columbia Savrs freedom forum-A (insured by MBIA),
Houston Tex Util Sys Rev Adj-Rfdg-Comb (insured by AMBAC), Education Loan Trust
(insured by FFELP), Utah State Board of Rgts (insured by FFELP), Indiana
Transportation Finance Authority (insured by CIFG), Indiana Secondary Market
Education loans (insured by FFELP), Illinois Student Assist Comm (backed by
student loan), and Kentucky Higher Education (insured by FFELP). The interest
rates on these securities at the date of the failed auction range from 1.9% to
7.2%, with a weighted average rate of 3.95%.
As a result, we continue to hold these securities and the issuers are
required pay interest on the securities at the maximum contractual rates. We
reduced our total ARS investments principally by investing in other short-term
marketable securities, as individual ARS reset periods came due. Unsuccessful
auctions have caused us to hold these securities beyond their scheduled auction
reset dates, limiting the short-term liquidity of these investments. Such
developments may result in the classification of some or all of these securities
as long-term in our consolidated balance sheets in 2008 or future periods. In
addition, if the issuers are unable to successfully close future auctions and
their credit ratings deteriorate, we may, in the future, be required to adjust
the carrying value of these investments which would result in a charge to our
consolidated statement of operations.
Based on current market conditions, there is no assurance that auctions on
the remaining ARS in our investment portfolio will be successful. Unsuccessful
auctions will cause us to hold securities beyond their next scheduled auction
13
reset dates and limit the short-term liquidity of these investments. While these
failures in the auction process have affected our ability to access these funds
in the near term, we do not believe that the underlying securities or collateral
have been affected. We believe that the higher reset rates on failed auctions
provide sufficient incentive for the security issuers to address this lack of
liquidity. However, our ability to liquidate and fully recover the carrying
value of our remaining ARS in the near term may be limited. These developments
may result in the classification of some or all of these securities as long-term
in our consolidated financial statements in 2008 or future periods. In addition,
if the issuers are unable to successfully close future auctions and their credit
ratings deteriorate, we may, in the future, be required to adjust the carrying
value of these investments through an impairment charge.
RISKS RELATING TO GOVERNMENT REGULATION
GOVERNMENT REGULATION COULD ADVERSELY IMPACT OUR DEVELOPMENT OF WIRELESS
BROADBAND PRODUCTS AND SERVICES, OUR OFFERING OF PRODUCTS AND SERVICES TO
CONSUMERS, AND OUR BUSINESS PROSPECTS.
The regulatory environment in which we operate is subject to significant
change, the results and timing of which are uncertain. The FCC has jurisdiction
over the grant, renewal, lease, assignment and sale of our domestic wireless
licenses, the use of wireless spectrum to provide communications services, and
the resolution of interference between users of various spectrum bands. Other
aspects of our business, including construction and operation of our wireless
systems, and the offering of communications services, are regulated by the FCC
and other federal, state and local governmental authorities. States may exercise
authority over such things as billing practices and consumer-related issues.
Various governmental authorities could adopt regulations or take other
actions that would adversely affect the value of our assets, increase our costs
of doing business, and impact our business prospects. Changes in the regulation
of our activities, including changes in how wireless, mobile, and IP-enabled
services are regulated, changes in the allocation of available spectrum by the
United States and/or exclusion or limitation of our technology or products by a
government or standards body, could have a material adverse effect on our
business, operating results, liquidity and financial position.
CHANGES IN LEGISLATION OR REGULATIONS MAY AFFECT OUR ABILITY TO CONDUCT
OUR BUSINESS OR REDUCE OUR PROFITABILITY.
Future legislative, judicial or other regulatory actions could have a
negative effect on our business. Some legislation and regulations applicable to
the wireless broadband business, including how IP-enabled services are
regulated, are the subject of ongoing judicial proceedings, legislative hearings
and administrative proceedings that could change the manner in which our
industry is regulated and the manner in which we operate. We cannot predict the
outcome of any of these proceedings or their potential impact on our business.
If, as a result of regulatory changes, we become subject to general common
carrier rules and regulations applicable to telecommunications service
providers, commercial mobile radio service providers offering certain switched
services on a common carrier basis, and/or enhanced service providers, including
providers of interconnected VoIP service, at the federal level or in individual
states, we may incur significant administrative, litigation and compliance
costs, or we may have to restructure our service offerings, exit certain markets
or raise the price of our services, any of which could cause our services to be
less attractive to customers. In addition, future regulatory developments could
increase our cost of doing business and limit our growth.
WE MAY NOT HAVE COMPLETE CONTROL OVER OUR TRANSITION OF BRS AND EBS
SPECTRUM, WHICH COULD IMPACT COMPLIANCE WITH FCC RULES.
The FCC's rules require transition of BRS and EBS spectrum to the new band
plan on a Basic Trading Area ("BTA") basis. See "Government Regulation-BRS-EBS
License Conditions." We do not hold all of the BRS and EBS spectrum in the BTAs
in which we hold spectrum. Consequently, we will need to coordinate with other
BRS and EBS licensees in order to transition spectrum we hold or lease.
Disagreements with other BRS or EBS licensees about how the spectrum should be
transitioned may delay our efforts to transition spectrum, could result in
increased costs to transition the spectrum, and could impact our efforts to
comply with applicable FCC rules. The FCC rules permit us to self-transition to
the reconfigured band plan if other spectrum holders in our BTAs do not timely
transition their spectrum.
14
OUR USE OF EBS SPECTRUM IS SUBJECT TO PRIVATELY NEGOTIATED LEASE
AGREEMENTS. CHANGES IN FCC RULES GOVERNING SUCH LEASE AGREEMENTS, CONTRACTUAL
DISPUTES WITH EBS LICENSEES, OR FAILURES BY EBS LICENSEES TO COMPLY WITH FCC
RULES COULD IMPACT OUR USE OF THE SPECTRUM.
All commercial enterprises are restricted from holding licenses for EBS
spectrum. Eligibility for EBS spectrum is limited to accredited educational
institutions, governmental organizations engaged in the formal education of
enrolled students (e.g., school districts), and nonprofit organizations whose
purposes are educational. Access to EBS spectrum can only be gained by
commercial enterprises through privately-negotiated EBS lease agreements. FCC
regulation of EBS leases, private interpretation of EBS lease terms, private
contractual disputes, and failure of an EBS licensee to comply with FCC
regulations all could impact our use of EBS spectrum and the value of our leased
EBS spectrum. The FCC rules permit EBS licensees to enter into lease agreements
with a maximum term of 30 years; lease agreements with terms longer than 15
years must contain a "right of review" by the EBS licensee every five years
beginning in year 15. The right of review must afford the EBS licensee with an
opportunity to review its educational use requirements in light of changes in
educational needs, technology, and other relevant factors and to obtain access
to such additional services, capacity, support, and/or equipment as the parties
shall agree upon in the spectrum leasing arrangement to advance the EBS
licensee's educational mission. A spectrum leasing arrangement may include any
mutually agreeable terms designed to accommodate changes in the EBS licensee's
educational use requirements and the commercial lessee's wireless broadband
operations. In addition, the terms of EBS lease agreements are subject to
contract interpretation and disputes could arise with EBS licensees. There can
be no assurance that EBS leases will continue for the full lease term, or be
extended beyond the current term, or be renewed or extended on terms that are
satisfactory to us. Similarly, since we are not eligible to hold EBS licenses,
we must rely on EBS licensees with whom we contract to comply with FCC rules.
The failure of an EBS licensee from whom we lease spectrum to comply with the
terms of their FCC authorization or FCC rules could result in termination,
forfeiture or non-renewal of their authorization, which would negatively impact
the amount of spectrum available for our use.
IF WE DO NOT COMPLY WITH FCC BUILD-OUT REQUIREMENTS RELATING TO OUR
SPECTRUM LICENSES, SUCH LICENSES COULD BE SUBJECT TO FORFEITURE.
Certain build-out or "substantial service" requirements apply to our
licensed wireless spectrum, which generally must be satisfied as a condition of
license renewal. In particular, the renewal deadline and the substantial service
build-out deadline for our WCS spectrum is July 21, 2010; for our BRS and EBS
spectrum, the substantial service build-out deadline is May 1, 2011; and for our
AWS spectrum, the substantial service build-out deadline is December 18, 2021.
Failure to make the substantial service demonstration, without seeking and
obtaining an extension from the FCC, would result in license forfeiture.
WE HAVE NO GUARANTEE THAT THE LICENSES WE HOLD OR LEASE WILL BE RENEWED.
The FCC generally grants wireless licenses for terms of ten or 15 years,
which are subject to renewal and revocation. FCC rules require all wireless
licensees to comply with applicable FCC rules and policies and the
Communications Act in order to retain their licenses. For example, licensees
must meet certain construction requirements, including making substantial
service demonstrations, in order to retain and renew FCC licenses. Failure to
comply with FCC requirements with respect to any license could result in
revocation or non-renewal of a license. In general, most wireless licensees who
meet their construction and/or substantial service requirements are afforded a
"renewal expectancy," however, all FCC license renewals can be challenged in
various ways, regardless of whether such challenges have any legal merit. Under
FCC rules, licenses continue in effect during the pendency of timely filed
renewal applications. Challenges to license renewals, while uncommon, may impact
the timing of renewal grants and may impose legal costs. Accordingly, there is
no guarantee that licenses we hold or lease will remain in full force and effect
or be renewed.
We hold 30 licenses issued by the FCC for WCS spectrum. Renewal
applications for all 2.3 GHz WCS licenses, including those issued to NextWave,
were due to be filed with the FCC on July 21, 2007. We filed our WCS renewal
applications on April 23, 2007. Under FCC rules, licenses continue in effect
during the pendency of timely file renewal applications. At least three parties
about which we are aware made filings purporting to be "competing applications"
in response to the renewal applications filed by our Company, AT&T and perhaps
others. The basis on which the third-party filings were made was the alleged
failure of WCS licensees to deploy service on WCS spectrum and satisfy
substantial service requirements by July 21, 2007. However, on December 1, 2006,
15
the FCC issued a waiver order extending the substantial service deadline for WCS
licensees to July 21, 2010. The FCC's rules contain no procedures for processing
"competing applications" filed for WCS spectrum and it has not made any of the
third-party filings available in the public record or accepted them for filing.
We have no knowledge of the status of these filings and cannot predict how the
FCC may address them or how these filings may impact our renewal applications.
INTERFERENCE COULD NEGATIVELY IMPACT OUR USE OF WIRELESS SPECTRUM WE HOLD,
LEASE OR USE.
Under applicable FCC rules, users of wireless spectrum must comply with
technical rules that are intended to eliminate or diminish harmful
radiofrequency interference between wireless users. Licensed spectrum is
generally entitled to interference protection, subject to technical rules
applicable to the radio service, while unlicensed spectrum has no interference
protection rights and must accept interference caused by other users.
WIRELESS DEVICES UTILIZING WCS, BRS AND EBS SPECTRUM MAY BE SUSCEPTIBLE TO
INTERFERENCE FROM SATELLITE DIGITAL AUDIO RADIO SERVICES ("SDARS").
Since 1997, the FCC has considered a proposal to permanently authorize
terrestrial repeaters for SDARS operations adjacent to the C and D blocks of the
WCS band. The FCC has permitted a large number of these SDARS terrestrial
repeaters to operate on a special temporary authorization since 2001.
Permanently authorizing SDARS repeaters adjacent to the WCS band could cause
interference to WCS, BRS and EBS receivers. The extent of the interference from
SDARS repeaters is unclear and is subject to the FCC's final resolution of
pending proceedings. Because WCS C and D block licenses are adjacent to the
SDARS spectrum, the potential for interference to this spectrum is of greatest
concern. There is a lesser magnitude concern regarding interference from SDARS
to WCS A and B block licenses, and BRS and EBS licenses. Central to the FCC's
evaluation of this proposal has been the technical specifications for the
operation of such repeaters. SDARS licensees are seeking rule changes that would
both unfavorably alter WCS technical operating requirements and permit all
existing SDARS repeaters to continue to operate at their current operating
parameters. Through their representative association, the WCS Coalition, the
majority of affected WCS licensees, including NextWave, also have proposed
technical rules for SDARS terrestrial repeaters and WCS operations to the FCC.
Final technical rules will determine the potential interference conditions and
requirements for mitigation. If SDARS repeaters result in interference to our
WCS, BRS or EBS spectrum, our ability to realize value from this spectrum may be
impaired.
INCREASING REGULATION OF THE TOWER INDUSTRY MAY MAKE IT DIFFICULT TO
DEPLOY NEW TOWERS AND ANTENNA FACILITIES.
The FCC, together with the FAA, regulates tower marking and lighting. In
addition, tower construction and deployment of antenna facilities is impacted by
federal, state and local statutes addressing zoning, environmental protection
and historic preservation. The FCC adopted significant changes to its rules
governing historic preservation review of new tower projects, which makes it
more difficult and expensive to deploy towers and antenna facilities. The FCC
also is considering changes to its rules regarding when routine environmental
evaluations will be required to determine compliance of antenna facilities with
its radiofrequency radiation exposure limits. If adopted, these regulations
could make it more difficult to deploy facilities. In addition, the FAA has
proposed modifications to its rules that would impose certain notification
requirements upon entities seeking to (i) construct or modify any tower or
transmitting structure located within certain proximity parameters of any
airport or heliport, and/or (ii) construct or modify transmission facilities
using the 2500-2700 MHz radiofrequency band, which encompasses virtually all of
the BRS/EBS frequency band. If adopted, these requirements could impose new
administrative burdens upon use of BRS/EBS spectrum.
16
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
This registration statement and other reports, documents and materials we
will file with the SEC contain, or will contain, disclosures that are
forward-looking statements that are subject to risks and uncertainties. All
statements other than statements of historical facts are forward-looking
statements. These statements, which represent our expectations or beliefs
concerning various future events, may contain words such as "may," "will,"
"expects," "anticipates," "intends," "plans," "believes," "estimates," or other
words of similar meaning in connection with any discussion of the timing and
value of future results or future performance. These forward-looking statements
are based on the current plans and expectations of our management and are
subject to certain risks, uncertainties (some of which are beyond our control)
and assumptions that could cause actual results to differ materially from
historical results or those anticipated. These risks include, but are not
limited to:
o our limited relevant operating history;
o our ability to manage growth or integrate recent or future
acquisitions;
o our ability to execute our business plan and to become cash flow
positive;
o competition from alternative wireless technologies and other
technology companies;
o our ability to develop and commercialize mobile broadband
products and technologies;
o the ability of vendors to manufacture commercial WiMAX equipment
and devices;
o consumer acceptance of fourth generation wireless technologies,
such as WiMAX;
o consumer acceptance of mobile TV and mobile broadcast services;
o changes in government regulations;
o any loss of our key executive officers; and
o the other risks described under "Risk Factors" and elsewhere in the
information contained or incorporated into this registration
statement.
There may also be other factors that cause our actual results to differ
materially from the forward looking statements.
Because of these factors, we caution you that you should not place any
undue reliance on any of our forward-looking statements. These forward-looking
statements speak only as of the date of this registration statement and you
should understand that those statements are not guarantees of future performance
or results. New risks and uncertainties arise from time to time, and it is
impossible for us to predict those events or how they may affect us. Except as
required by law, we have no duty to, and do not intend to publicly update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise.
17
USE OF PROCEEDS
We are registering these shares pursuant to the registration rights
granted to the selling stockholders in connection with the acquisition of
IPWireless, Inc. We will not receive any proceeds from the resale of our common
stock under this offering.
18
SELLING STOCKHOLDERS
The selling stockholders may from time to time offer and sell any or all
of the shares of our common stock set forth below pursuant to this prospectus.
When we refer to "selling stockholders" in this prospectus, we mean the persons
listed in the table below, and the pledges, donees, permitted transferees,
assignees, successors and others who later come to hold any of the selling
stockholders' interests in shares of our common stock other than through a
public sale.
The following table sets forth, as of the date of this prospectus, the
name of the selling stockholders for whom we are registering shares for resale
to the public, and the number of shares of common stock that each selling
stockholder may offer pursuant to this prospectus. The shares of common stock
offered by the selling stockholders were issued pursuant to exemptions from the
registration requirements of the Securities Act. The selling stockholders
represented to us that they were accredited investors and were acquiring our
common stock for investment and had no present intention of distributing the
common stock. We have agreed to file a registration statement covering the
common stock received by the selling stockholders. We filed with the SEC, under
the Securities Act, a Registration Statement on Form S-3 with respect to the
resale of the common stock from time to time by the selling stockholders, and
this prospectus forms a part of that registration statement.
Based on the information provided to us by the selling stockholders and as
of the date the same was provided to us, assuming that the selling stockholders
sell all of the shares of our common stock beneficially owned by them that have
been registered by us and do not acquire any additional shares during the
offering, the selling stockholders will not own any shares other than those
appearing in the column entitled "Number of Shares of Common Stock Owned After
the Offering." We cannot advise you as to whether the selling stockholders will
in fact sell any or all of such shares of common stock. In addition, the selling
stockholders may have sold, transferred or otherwise disposed of, or may sell,
transfer or otherwise dispose of, at any time and from time to time, the shares
of our common stock in transactions exempt from the registration requirements of
the Securities Act after the date on which it provided the information set forth
on the table below.
NUMBER OF
SHARES OF NUMBER OF NUMBER OF PERCENTAGE
COMMON SHARES OF SHARES OF OF
STOCK COMMON COMMON COMMON
OWNED STOCK ISSUED STOCK STOCK
PRIOR TO PURSUANT TO OWNED OWNED
THE THE AFTER THE AFTER THE
NAME OF SELLING STOCKHOLDER OFFERING OFFERING(1) OFFERING OFFERING (2)
--------------------------- -------- ----------- -------- ------------
Alan E. Jones
21 Petty Lane
Derry Hill
Calne, Wiltshire
SN11 9QY
United Kingdom 592 32,126 32,718 *%
Anne M. Drysdale
177 Bovet Road,
Suite 600
San Mateo
CA 94402 8,009 14,969 22,978 *%
Bay Partners LS Fund, LP
2882 Sand Hill Road,
Suite 240
Menlo Park
CA 94025 30,547 689,556 720,103 *%
Bay Partners SBIC II, LP
2882 Sand Hill Road,
Suite 240
Menlo Park
CA 94025 9,194 207,540 216,734 *%
19
Bert L. Zaccaria
PO Box S-PMB 3003
Carmel
CA 93921 71 1,606 1,677 *%
Blair Woodward
910 Princeton Kingston Rd.
Princeton
NJ 08540 1,630 3,741 5,371 *%
Bradford Jeffries
c/o Cooley Godward
101 California Street,
5th Floor
San Francisco
CA 94111 6,801 6,883 13,684 *%
Cassin 1997 Charitable Trust
Attn: Brendan J. Cassin &
Isabel Cassin
3000 Sand Hill Rd,
Building 3, Suite 210
Menlo Park
CA 94025 2,801 6,440 9,241 *%
Cassin Family Partners, a CA
Limited Partnership
Attn: Brendan J. Cassin &
Isabel Cassin
3000 Sand Hill Rd,
Building 3, Suite 210
Menlo Park
CA 94025 11,238 21,204 32,442 *%
Cassin Family Trust UDT
1/31/96
Attn: Brendan J. Cassin &
Isabel Cassin
3000 Sand Hill Rd,
Building 3, Suite 210
Menlo Park
CA 94025 103,748 119,086 222,834 *%
Robert S. Cassin Charitable
Trust UTA dated 2/20/97
Attn: Brendan J. Cassin &
Isabel Cassin
3000 Sand Hill Rd,
Building 3, Suite 210
Menlo Park
CA 94025 2,801 6,440 9,241 *%
Christopher Noble
c/o Bay Partners
2882 Sand Hill Road,
Suite 240
Menlo Park
CA 94025 6,365 14,633 20,998 *%
Christy C. Kunin
15065 NE 144th Street
Redmond
WA 98052 17 46 63 *%
20
Clarity Partners, L.P.
Attn: R. Rudolph Reinfrank
or Clint Walker
100 North Crescent Drive,
Suite 300
Beverly Hills
CA 90210 264,269 600,092 864,361 *%
CNA Trust TTEE, FBO Venture
Law Group 401(k) John V.
Bautista
c/o Union Bank
3080 S. Bristol St.
2nd Floor
Costa Mesa
CA 92626 323 5,192 5,515 *%
Craig W. Johnson
c/o Concept2Company, Inc.
100 Hamilton Ave.,
Suite 100
Palo Alto
CA 94301 1,113 25,127 26,240 *%
Dan Burke
128 Scenic Drive
Redwood City
CA 94062 347 18,813 19,160 *%
Daniel Goldberg
c/o Telesat Canada
1601 Telesat Court
Gloucester, Ontario K1B 5P4
K1B5P4, Canada 699 1,609 2,308 *%
DCM II Annex Fund, L.P.
Attn: Lisa Harris
2420 Sand Hill Road,
Suite 200
Menlo Park
CA 94025 7,179 162,065 169,244 *%
DCM Internet Fund, L.P.
Attn: Lisa Harris
2420 Sand Hill Road,
Suite 200
Menlo Park
CA 94025 1,645 37,099 38,744 *%
DCM Network Fund, L.P.
Attn: Lisa Harris
2420 Sand Hill Road,
Suite 200
Menlo Park
CA 94025 890 20,056 20,946 *%
Dempsey Revocable Trust
c/o Bay Partners
2882 Sand Hill Road,
Suite 240
Menlo Park
CA 94025 809 18,291 19,100 *%
Derek J. Kerton
8032 Canyon Creek Circle
Pleasanton
CA 94588-4764 659 1,287 1,946 *%
Doll Technology Affiliates
Fund II, L.P.
Attn: Lisa Harris
2420 Sand Hill Road,
Suite 200
Menlo Park
CA 94025 1,005 22,692 23,687 *%
21
Doll Technology Investment
Fund II, L,P.
2420 Sand Hill Road, Suite
200
Menlo Park
CA 94025 16,004 361,238 377,242 *%
Donald L. Lucas, SUCC TTE
3000 Sand Hill Rd,
Building 3, Suite 210
Menlo Park
CA 94025 951 21,473 22,424 *%
Donald L. Lucas, TTEE Donald
L. and Lygia S. Lucas Trust
3000 Sand Hill Rd,
Building 3, Suite 210
Menlo Park
CA 94025 176 3,974 4,150 *%
Dougery Ventures, LLC
Attn: John Dougery
165 Santa Ana Avenue
San Francisco
CA 94127 11 261 272 *%
Drysdale Partners
177 Bovet Road, Suite 600
San Mateo
CA 94402 7,229 13,808 21,037 *%
Elise P.W. Kiely
161 Woodlands Dr.
Falmouth
ME 04105 76 46 122 *%
Ellen Hancock
PO Box 169
Ridgefield
CT 06877 1,622 929 2,551 *%
Evelyn Bowen Lockton Trust
130 Reservoir Road
Hillsborough
CA 94010 21,526 4,557 26,083 *%
Freidenrich Family
Partnership, LP
Attn: Bob Burlinson
300 Hamilton Ave.
Palo Alto
CA 94301 4,273 84,298 88,571 *%
Gabriel Legacy Fund II, L.P.
Attn: Frederick W. Bolander
350 Marine Parkway,
Suite 2000
Redwood Shores
CA 94065 375 858 1,233 *%
Gabriel Legacy Fund L.P.
Attn: Frederick W. Bolander
350 Marine Parkway,
Suite 2000
Redwood Shores
CA 94065 19,332 26,686 46,018 *%
Gabriel Venture Partners II,L.P.
Attn: Frederick W. Bolander
350 Marine Parkway,
Suite 2000
Redwood Shores
CA 94065 231,541 542,129 773,670 *%
22
Gabriel Venture Partners L.P.
Attn: Frederick W. Bolander
350 Marine Parkway, Suite
2000
Redwood Shores
CA 94065 435,476 464,746 900,222 *%
Gary M. Cohen
2001 Halyard Lane
Reston
VA 20191 204 557 761 *%
George Drysdale
177 Bovet Road, Suite 600
San Mateo
CA 94402 3,216 6,185 9,401 *%
Henry L. B. Wilder
3301 Tripp Road
Woodside
CA 94061 5,409 118,020 123,429 *%
Henry T. Wilson
c/o Northwood Ventures
484 Underhill Blvd.,
Suite 205
Syosset
NY 11791 85 232 317 *%
Inspirit Technology Limited
c/o PCCW Limited
PCCW A8Tower, 39th Floor
Taikoo Place, Q979 King's
Road, Quarry Bay
Hong Kong 71,966 44,013 115,979 *%
Inspirit Technology Limited
c/o PCCW Limited
PCCW A8Tower, 39th Floor
Taikoo Place, Q979 King's
Road, Quarry Bay
Hong Kong 0 600,092 600,092 *%
J.F. Shea Co., Inc. as
Nominee 1999-89 Edmund H.
Shea, Jr.
Attn: Edmund H. Shea, Jr.
655 Brea Canyon Road
Walnut
CA 91789 40,869 922,552 963,421 *%
James Wickett
142 Patricia Drive
Atherton
CA 94027 3,182 7,316 10,498 *%
Jeffery L. Donovan
201 Merritt Road
Los Altos
CA 94022 10,868 4052 14,920 *%
Jeffrey Blumenfeld
6614 32nd St., NW
Washington
DC 20015 3,317 557 3,874 *%
John and Marilyn Dougery
Trust, John R. and Marilyn
R. Dougery, Trustees
165 Santa Ana Avenue
San Francisco
CA 94127 220 4,954 5,174 *%
23
John Lockton
130 Reservoir Road
Hillsborough
CA 94010 9,050 24,551 33,601 *%
John Nicholson
c/o The Nicholson Company
1680 Dell Ave.
Campbell
CA 95008 136 374 510 *%
John R. Dougery, Jr. Trust,
John R. Dougery, Trustee
165 Santa Ana Avenue
San Francisco
CA 94127 11 261 272 *%
John V. Bautista
c/o Orrick Herrington &
Sutcliffe
1000 Marsh Rd.
Menlo Park
CA 94025 4,178 5,293 9,471 *%
Jonathan Beizer
1335 Brandt Street
Hillsborough
CA 94010 2,173 117,985 120,158 *%
Jonathan Hambridge
174 Granville Way
San Francisco
CA 94127 347 18,813 19,160 *%
Kathryn Ann Dougery Trust,
John R. Dougery, Trustee
165 Santa Ana Avenue
San Francisco
CA 94127 11 261 272 *%
KOCO Capital Company, L.P.
Shant Mardirossian
111 Radio Circle
Mt. Kisco
NY 10549 20,451 3,441 23,892 *%
Loring W. Knoblauch, Jr.
760 Old Post Road
Bedford
NY 10506 341 731 1,072 *%
Malcom Gordon
65 Penn Lea Road
Bath, AVON
BA1 3RQ
United Kingdom 592 32,126 32,718 *%
M. Mavin Howley, trustee of
the M. Mavin Howley Trust
dtd 2/18/05
235 Del Casa Drive
Mill Valley
CA 94941 80,324 185,896 266,220 *%
Marcella Yano
511 Harvard Rd.
San Mateo
CA 94402 1,351 2,925 4,276 *%
24
Marilyn Dougery Trust
165 Santa Ana Avenue
San Francisco
CA 94127 11 261 272 *%
Multimedia Research
Institute Corp.
Attn: Akira Morio
Hill Crest Hirakawacho 1 F
2-5-7 Hirakawacho,
Chiyodaku
Tokyo, Japan 102-0093 59,809 128,820 188,629 *%
Nextel Data Investments I,
Inc.
Attn: Todd Rowley or
Melissa LeTendre
2001 Edmund Halley Drive
Reston
VA 20191 2,941,455 0 2,941,455 1.94%
Northwood Capital Partners
LLC
c/o Northwood Ventures
484 Underhill Blvd.,
Suite 205
Syosset
NY 11791 4,103 9,815 13,918 *%
Northwood Ventures LLC
c/o Northwood Ventures
484 Underhill Blvd.,
Suite 205
Syosset
NY 11791 26,618 58,895 85,513 *%
Oak Hill Capital Management
Partners, L.P.
Attn: Kevin Levy
201 Main Street, Suite 2415
Fort Worth
TX 76102 19,802 45,501 65,303 *%
Oak Hill Capital Partners, L.P.
Attn: Kevin Levy
201 Main Street, Suite 2415
Fort Worth
TX 76102 772,322 1,774,588 2,546,910 1.68%
OHCP IPWireless, L.P.
Attn: Kevin Levy
201 Main Street, Suite 2415
Fort Worth
TX 76102 3,980 9,145 13,125 *%
Peter A. Howley
Western Venture
369 B Third Street, #373
San Rafael
CA 94901 9,199 188,896 198,095 *%
Peter G. Schiff
c/o Northwood Ventures
484 Underhill Blvd., Suite
205
Syosset
NY 11791 1,493 4,092 5,585 *%
Pride Park Investment Pte Ltd.
c/o GIC Special
Investments Pte Ltd.
255 Shoreline Drive,
Suite 600
Redwood City
CA 94065 318,316 731,694 1,050,010 *%
25
RBC Dain Rauscher Cust.
Kevin Shannon (IRA)
1761 Novato Blvd.
Novato
CA 94947 1,335 3,220 4,555 *%
Richard M. Lucas Foundation
3000 Sand Hill Rd,
Building 3, Suite 210
Menlo Park
CA 94025 1,021 23,062 24,083 *%
Robert E. Hoffman
971 Colonial Meadows Way
Virginia Beach
VA 23454 419 0 419 *%
Roger Nichol
Waylands
Folly Road
Lambourn, Berkshire
RG17 8QE
United Kingdom 592 32,126 32,718 *%
Roger Quayle
2517 Valdivia Way
Burlingame
CA 94010 22,095 90,776 112,871 *%
Rolapp Trust
165 Santa Ana Avenue
San Francisco
CA 94127 11 261 272 *%
Settlemier Revocable Trust
UAD 2-1-89
451 Marina Blvd.
San Francisco
CA 94123 700 1,609 2,309 *%
Shelley Dougery Trust, John
R. Dougery, Trustee
165 Santa Ana Avenue
San Francisco
CA 94127 11 261 272 *%
SilverHaze Partners, L.P.
Attn: Zeid Masri, President
6862 Elm Street, Suite 720
McLean
VA 22101 19,604 42,245 61,849 *%
Stone House LLC
7527 Old Dominion Drive
McLean
VA 22102 8,967 19,322 28,299 *%
The K.B. and Sukanya
Chandrasekhar Living Trust
21591 Regnart Rd.
Cupertino
CA 95014 4,953 111,814 116,767 *%
26
Thierry Maupile
25731 Deerfield Drive
Los Altos Hills
CA 94066 2,065 9,406 11,471 *%
Theodore H. Swindells
139 24th Avenue
San Francisco
CA 94121 2,341 6,418 8,759 *%
VLG Associates 2000
Attn: Mark Royer
275 Middlefield Rd.
Menlo Park
CA 94025 195 448 643 *%
VLG Investments 1999
Attn: Mark Royer
275 Middlefield Rd.
Menlo Park
CA 94025 458 1,255 1,713 *%
William Jones
Meadow Vale
Dauntsey
Chippenham, Wiltshire
SN15 4JH
United Kingdom 2,673 145,005 147,678 *%
* Represents beneficial ownership of less than 1%
(1) The number of shares of our common stock being offered for resale includes
3,417,299 shares subject to escrow arrangements until May 11, 2008, which
shares will be subject to forfeiture if we incur certain losses which are
indemnifiable under the IPWireless Merger Agreement, including any losses
we may incur as a result of any breach of the representations and
warranties or covenants of IPWireless contained in our merger agreement
with IPWireless.
(2) Unless otherwise indicated, assumes that each selling stockholder will
resell all of the shares of our common stock offered hereunder. Applicable
percentage of ownership is based on 151,525,594 shares of our common stock
outstanding as of March 10, 2008, together with securities exercisable
for, or convertible into, shares of common stock within 60 days of March
10, 2008.
27
DESCRIPTION OF CAPITAL STOCK
GENERAL
As of March 10, 2008, we have 92,713,778 shares of our common stock
outstanding held by approximately 1,080 holders of record. Our authorized
capital stock consists of 400,000,000 shares of common stock, par value $0.001
per share and 25,000,000 shares of preferred stock, par value $0.001 per share,
of which 355,000 shares have been designated as Series A Senior Convertible
Preferred Stock. As of March 10, 2008, we have 355,000 shares of our Series A
Preferred Stock outstanding, convertible into 33,996,100 shares of our Common
Stock as of that date, held by approximately 21 holders of record. The
outstanding shares of our common stock and Series A Preferred Stock are fully
paid and non-assessable. As of March 10, 2008, there are 38,848,294 shares
reserved for future issuance, of which 23,528,911 will be reserved for issuance
upon the exercise of granted and outstanding options and warrants and 15,319,383
will be available for future option grants, plus approximately $7.0 million of
our common stock may be issued under the IPWireless Employee Stock Bonus Plan
upon the achievement of certain milestones relating to product shipments and up
to $5.0 million of our common stock may be issued under the GO Networks Employee
Stock Bonus Plan upon the achievement of certain milestones relating to product
shipments. In addition, shares of our common stock have become issuable pursuant
to the CYGNUS Plan and the PacketVideo Corporation 2005 Equity Incentive Plan
(the "PacketVideo Plan").
A description of our common stock and Series A Preferred Stock appears
below.
COMMON STOCK
Dividend Rights. Holders of outstanding shares of our common stock are
entitled to receive dividends out of assets legally available at the times and
in the amounts that our board of directors may determine from time to time.
Voting Rights. Each holder of common stock is entitled to one vote for
each share of common stock held on all matters submitted to a vote of
stockholders. We have not provided for cumulative voting for the election of
directors in our certificate of incorporation. This means that the holders of a
majority of the shares voted can elect all of the directors then standing for
election.
No Preemptive, Conversion or Redemption Rights. Our common stock is not
entitled to preemptive rights and is not subject to conversion or redemption.
Right to Receive Liquidation Distributions. Upon our liquidation,
dissolution or winding-up, the holders of our common stock are entitled to share
in all assets remaining after payment of all liabilities and the liquidation
preferences of any outstanding preferred stock. Each outstanding share of common
stock is fully paid and nonassessable.
SERIES A PREFERRED STOCK
Dividend Rights. The Series A Preferred Stock is entitled to receive
quarterly dividends on the liquidation preference at a rate of 7.5% per annum.
Until the fourth anniversary of issuance, we can elect whether to declare
dividends in cash or to not declare and pay dividends, in which case the per
share dividend amount will be added to the liquidation preference. From and
after the fourth anniversary of issuance, we must declare dividends in cash each
quarter, subject to applicable law. The dividend rate is subject to adjustment
to 10% per annum if we default in our dividend payment obligations. The dividend
rate is also subject to adjustment to 15% per annum if we fail to comply with
the protective covenants of the Series A Preferred Stock described below and to
18% per annum if we fail to convert or redeem the Series A Preferred Stock when
required to do so, as described below.
Voting Rights. Pursuant to the terms of the Series A Preferred Stock, so
long as at least 25% of the issued shares of Series A Preferred Stock remain
outstanding, and until the date on which we elect to redeem all shares of Series
A Preferred Stock in connection with an asset sale, as described below, we must
receive the approval of the holders of shares representing at least 75% of the
Series A Preferred Stock then outstanding to (i) incur indebtedness in excess of
$500 million, subject to certain adjustments and exceptions, (ii) create any
capital stock that is senior to or on a parity with the Series A Preferred Stock
28
in terms of dividends, distributions or other rights, or (iii) consummate asset
sales involving the receipt of gross proceeds of, or the disposition of assets
worth, $500 million or more based on their fair market value. In addition, so
long as at least 25% of the issued shares of Series A Preferred Stock remain
outstanding, we may not distribute rights or warrants to all holders of our
common stock entitling them to purchase shares of our common stock, or
consummate any sale of our common stock, for an amount less than the fair market
value on the date of issuance, with certain exceptions. With respect to other
matters requiring stockholder approval, the shares of Series A Preferred Stock
will be entitled to vote as one class with the common stock on an as-converted
basis.
Conversion Rights and Redemption Rights. Each share of Series A Preferred
Stock is convertible into a number of shares of our common stock equal to the
liquidation preference then in effect divided by $11.05. If all shares of Series
A Preferred Stock were to be converted, we would be obligated to issue
33,996,100 shares of our common stock. The Series A Preferred Stock is
convertible at any time at the option of the holder, or at our election after
the 18-month anniversary of issuance, subject to the trading price of our common
stock reaching $22.10 for a specified period of time, except that such threshold
price will be reduced to $16.575 on the earlier of the third anniversary of
issuance or our consummation of a qualified public offering. We will not be
entitled to convert the Series A Preferred Stock at our election unless a shelf
registration statement covering the shares of common stock issued upon
conversion is then effective or the shares are no longer considered restricted
securities under the Securities Act.
We will be required to redeem all outstanding shares of Series A
Preferred Stock, if any, on March 28, 2017, at a price equal to the liquidation
preference plus unpaid dividends. If we elect to convert the Series A Preferred
Stock after our common stock price has reached the qualifying threshold, we must
redeem the shares of holders of Series A Preferred Stock who elect not to
convert into common stock at a price equal to 130% of the liquidation
preference. However, we are not required to redeem more than 50% of the shares
of Series A Preferred Stock subject to any particular conversion notice. In the
event that we fail to obtain approval of the holders of Series A Preferred Stock
to an asset sale transaction, we must either not consummate such asset sale or
elect to redeem all shares of Series A Preferred Stock at a redemption price
equal to 120% of the liquidation preference. Holders will be entitled to opt-out
of such a redemption.
Right to Receive Liquidation Distributions. The Series A Preferred Stock
has an initial liquidation preference of $1,000 per share, subject to increase
for accrued dividends as described above. The liquidation preference would
become payable upon redemption, as described above, upon a liquidation or
dissolution of our company, or upon deemed liquidation events including a change
in control, merger or sale of all or substantially all our assets, unless the
holders of Series A Preferred Stock provide a 75% vote to not treat a covered
event as a deemed liquidation. Upon a deemed liquidation event, the Series A
Preferred Stock will be entitled to receive an amount per share equal to the
greater of 120% of the liquidation preference or the amount that would have been
received if such share had converted into common stock in connection with such
event.
ANTI-TAKEOVER EFFECTS OF DELAWARE LAW AND THE CERTIFICATE OF INCORPORATION AND
BYLAWS OF NEXTWAVE WIRELESS INC.
The provisions of Delaware law, as well as our certificate of
incorporation and bylaws described below may have the effect of delaying,
deferring or discouraging another party from acquiring control of our company.
Delaware Law
Effective upon the listing of our common stock on The Nasdaq Global
Market, our company became subject to the provisions of Section 203 of the
Delaware General Corporation Law regulating corporate takeovers. In general,
those provisions prohibit a Delaware corporation from engaging in any business
combination with any interested stockholder for a period of three years
following the date that the stockholder became an interested stockholder,
unless: the transaction is approved by the board of directors before the date
the interested stockholder attained that status; upon consummation of the
transaction that resulted in the stockholder becoming an interested stockholder,
the interested stockholder owned at least 85% of the voting stock of the
corporation outstanding at the time the transaction commenced; or on or after
the date the business combination is approved by the board of directors and
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authorized at a meeting of stockholders by at least two-thirds of the
outstanding voting stock that is not owned by the interested stockholder.
Section 203 defines business combination to include the following: any
merger or consolidation involving the corporation and the interested
stockholder; any sale, transfer, pledge or other disposition of 10% or more of
the assets of the corporation involving the interested stockholder; subject to
certain exceptions, any transaction that results in the issuance or transfer by
the corporation of any stock of the corporation to the interested stockholder;
any transaction involving the corporation that has the effect of increasing the
proportionate share of the stock of any class or series of the corporation
beneficially owned by the interested stockholder; or the receipt by the
interested stockholder of the benefit of any loans, advances, guarantees,
pledges or other financial benefits provided by or through the corporation.
In general, Section 203 defines an interested stockholder as any entity
or person beneficially owning 15% or more of the outstanding voting stock of the
corporation and any entity or person affiliated with or controlling or
controlled by any of these entities or persons. A Delaware corporation may opt
out of this provision either with an express provision in its original
certificate of incorporation or in an amendment to its certificate of
incorporation or bylaws approved by its stockholders. However, we have not opted
out, and do not currently intend to opt out of this provision. The statute could
prohibit or delay mergers or other takeover or change in control attempts and,
accordingly, may discourage attempts to acquire us.
Certificate of Incorporation and Bylaws
Our certificate of incorporation and bylaws provide that:
[_] our directors serve staggered, three-year terms and accordingly,
pursuant to Delaware law, can only be removed with cause;
[_] no action can be taken by stockholders except at an annual or
special meeting of the stockholders called in accordance with our
bylaws, and stockholders may not act by written consent;
[_] our board of directors will be expressly authorized to make, alter
or repeal our bylaws, and our stockholders will be able to make,
alter or repeal our bylaws by a vote of 66-2/3% of the issued and
outstanding voting shares;
[_] any vacancies on the board of directors would be filled by a
majority vote of the board;
[_] our board of directors will be authorized to issue preferred stock
without stockholder approval; and
[_] we will indemnify officers and directors against losses that they
may incur in investigations and legal proceedings resulting from
their services to us, which may include services in connection with
takeover defense measures.
NASDAQ GLOBAL MARKET LISTING
Our common stock is listed on The Nasdaq Global Market under the ticker
symbol "WAVE".
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for our common stock is Computershare
Trust Company, N.A.
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PLAN OF DISTRIBUTION
The Selling Stockholders (the "Selling Stockholders") of the common stock
and any of their pledgees, assignees and successors-in-interest may, from time
to time, sell any or all of their shares of common stock on The Nasdaq Global
Market or any other stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. The Selling Stockholders may use any one or more of the
following methods when selling shares:
o ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchases;
o block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block
as principal to facilitate the transaction;
o purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
o an exchange distribution in accordance with the rules of the
applicable exchange;
o privately negotiated transactions;
o settlement of short sales entered into after the effective date of
the registration statement of which this prospectus is a part;
o broker-dealers may agree with the Selling Stockholders to sell a
specified number of such shares at a stipulated price per share;
o through the writing or settlement of options or other hedging
transactions, whether through an options exchange or otherwise;
o a combination of any such methods of sale; or
o any other method permitted pursuant to applicable law.
The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act"), if available, rather
than under this prospectus.
Broker-dealers engaged by the Selling Stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the Selling Stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated, but, except as set forth in a supplement to this Prospectus, in the
case of an agency transaction not in excess of a customary brokerage commission
in compliance with NASDR Rule 2440; and in the case of a principal transaction a
markup or markdown in compliance with NASDR IM-2440.
In connection with the sale of the common stock or interests therein, the
Selling Stockholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
common stock in the course of hedging the positions they assume. The Selling
Stockholders may also sell shares of the common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. The Selling
Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, 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 and any broker-dealers or agents that are
involved in selling the shares may be deemed to be "underwriters" within the
meaning of the Securities Act in connection with such sales. In such event, any
commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
31
commissions or discounts under the Securities Act. The Selling Stockholders have
informed the Company that they do not have any written or oral agreement or
understanding, directly or indirectly, with any person to distribute the common
stock. In no event shall any broker-dealer receive fees, commissions and markups
that, in the aggregate, would exceed eight percent (8%).
The Company is required to pay certain fees and expenses incurred by the
Company incidental to the registration of the shares. The Company has agreed to
indemnify the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act.
Because a Selling Stockholder may be deemed to be an "underwriter" within
the meaning of the Securities Act, it will be subject to the prospectus delivery
requirements of the Securities Act including Rule 172 thereunder. In addition,
any securities covered by this prospectus which qualify for sale pursuant to
Rule 144 under the Securities Act may be sold under Rule 144 rather than under
this prospectus. There is no underwriter or coordinating broker acting in
connection with the proposed sale of the resale shares by the Selling
Stockholders.
We agreed to keep this prospectus effective until the earlier of (i) the
date on which the shares may be resold by the Selling Stockholders without
registration and without regard to any volume limitations by reason of Rule
144(k) under the Securities Act or any other rule of similar effect or (ii) all
of the shares have been sold pursuant to this prospectus or Rule 144 under the
Securities Act or any other rule of similar effect. The resale shares will be
sold only through registered or licensed brokers or dealers if required under
applicable state securities laws. In addition, in certain states, the resale
shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.
Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the resale shares may not simultaneously engage
in market making activities with respect to the common stock for the applicable
restricted period, as defined in Regulation M, prior to the commencement of the
distribution. In addition, the Selling Stockholders will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including Regulation M, which may limit the timing of purchases and
sales of shares of the common stock by the Selling Stockholders or any other
person. We will make copies of this prospectus available to the Selling
Stockholders and have informed them of the need to deliver a copy of this
prospectus to each purchaser at or prior to the time of the sale.
LEGAL MATTERS
The validity of the shares of NextWave Wireless Inc. common stock offered
hereby will be passed upon for NextWave Wireless Inc. by Weil, Gotshal & Manges
LLP, New York, NY.
EXPERTS
Ernst & Young LLP, independent registered public accounting firm, has
audited NextWave Wireless Inc.'s consolidated financial statements and schedule
at December 29, 2007 and December 30, 2006, and the related consolidated
statements of operations, redeemable convertible preferred stock and
stockholders'/members' equity and cash flows for the years then ended and for
the period from April 13, 2005 (date of inception) through December 31, 2005, as
set forth in their report. We have incorporated by reference NextWave Wireless
Inc.'s consolidated financial statements and schedule in the prospectus and
elsewhere in the registration statement in reliance on Ernst & Young LLP's
report, given on their authority as experts in accounting and auditing.
The consolidated financial statements of IPWireless, Inc. as of December
31, 2006 and 2005, and for each of the years in the two-year period ended
December 31, 2006, have been incorporated by reference herein in reliance upon
the reports of KPMG LLP, independent registered public accounting firm and upon
the authority of said firm as experts in accounting and auditing.
The audit report covering the December 31, 2006, consolidated financial
statements of IPWireless contains an explanatory paragraph that states that
IPWireless's recurring losses from operations and net capital deficiency raise
32
substantial doubt about the entity's ability to continue as a going concern. The
consolidated financial statements do not include any adjustments that might
result from the outcome of that uncertainty.
The audit report covering the December 31, 2006 financial statements of
IPWireless refers to the adoption of Statement of Financial Accounting Standards
No 123 (R) Share-Based Payment, and Financial Accounting Standards Board
Statements of Position 150-5, Issuers Accounting under FASB Statement No. 150
for Freestanding Warrants and Other Similar Instruments on Shares that are
Redeemable.
WHERE YOU CAN FIND MORE INFORMATION
We file reports and other information with the SEC. On November 13, 2006,
we became a SEC reporting company as a successor to NextWave Wireless LLC.
Copies of NextWave Wireless LLC's and our reports and other information may be
inspected and copied at the public reference facilities maintained by the SEC at
SEC Headquarters, Public Reference Section, 100 F Street, N.E., Washington D.C.
20549. The public may obtain information on the operation of the SEC's public
reference facilities by calling the SEC at 1-800-SEC-0330.
Copies of these materials can also be obtained by mail at prescribed rates
from the Public Reference Section of the SEC at SEC Headquarters or by calling
the SEC at 1-800-SEC-0330. The SEC maintains a website that contains reports and
other information regarding NextWave Wireless LLC. The address of the SEC
website is http://www.sec.gov.
You should rely only on the information contained in this prospectus or on
information to which NextWave has referred you. We have not authorized anyone
else to provide you with any information.
33
INCORPORATION BY REFERENCE
The SEC allows us to "incorporate by reference" in this prospectus certain
of the information we file with the SEC. This means we can disclose important
information to you by referring you to another document that has been filed
separately with the SEC. The information incorporated by reference is considered
to be part of this prospectus, and will modify and supersede the information
included in this prospectus to the extent that the information included as
incorporated by reference modifies or supersedes the existing information.
The following documents filed by us with the SEC are hereby incorporated
by reference:
o Annual Report on Form 10-K for the fiscal year ended December 29,
2007;
o Current Reports on Form 8-K filed on May 17, 2007 and March 21,
2008;
o Amendment No. 1 to the Current Report on Form 8-K, filed on July 25,
2007, relating to the Current Report on Form 8-K, filed on May 17,
2007;
o Definitive Proxy Statement on Schedule 14A dated April 19, 2007,
relating to our annual meeting of stockholders held on May 17, 2007;
o all documents we have filed with the Commission pursuant to Sections
o 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934
after the date of the initial registration statement and prior to
the effectiveness of the registration statement, as well as
subsequent to the date of this prospectus and prior to the
termination of this offering, shall be deemed to be incorporated by
reference into this prospectus and to be part of this prospectus
from the date of the filing of the documents
Copies of these filings are available free of charge by writing to
NextWave Wireless Inc., 12670 High Bluff Drive, San Diego, California 92130,
Attention: Investor Relations, or by telephoning us at (858) 480-3100.
Any statement made in this prospectus concerning the contents of any
contract, agreement or other document is only a summary of the actual document.
You may obtain a copy of any document summarized in this prospectus at no cost
by writing to or telephoning us at the address and telephone number given above.
Each statement regarding a contract, agreement or other document is qualified in
its entirety by reference to the actual document.
34
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the estimated fees and expenses (except for
the SEC registration fee, the National Association of Securities Dealers, Inc.
filing fee and The Nasdaq Global Market listing fee) payable by the registrant
in connection with the registration of the common stock:
Securities and Exchange Commission registration fee $ 1,770.60
Printer expenses $ --
Legal fees and expenses $ 10,000.00
Accounting fees and expenses $ 40,000.00
-------------
Total $ 51,770.60
=============
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law permits our board of
directors to indemnify any person against expenses (including attorneys' fees),
judgments, fines, and amounts paid in settlement actually and reasonably
incurred by him or her in connection with any threatened, pending, or completed
action, suit, or proceeding in which such person is made a party by reason of
his or her being or having been a director, officer, employee, or agent of us,
or serving or having served, at our request, as a director, officer, employee,
or agent of another corporation, partnership, joint venture, trust, or other
enterprise, in terms sufficiently broad to permit such indemnification under
certain circumstances for liabilities (including reimbursement for expenses
incurred) arising under the Securities Act. The statute provides that
indemnification pursuant to its provisions is not exclusive of other rights of
indemnification to which a person may be entitled under any bylaw, agreement,
vote of stockholders or disinterested directors, or otherwise.
We have adopted provisions in our certificate of incorporation and bylaws
that limit the liability of our directors and officers for any loss, claim or
damage incurred by reason of any act or omission performed or omitted by such
person on our behalf and in good faith and in a manner reasonably believed to be
within the scope of the authority conferred on such person by our bylaws.
However, a director or officer will be liable for any act or omission (i) not
performed or omitted in good faith or which such person did not reasonably
believe to be in our best interests or which involved intentional misconduct or
knowing violation of the law or (ii) from which such person received an improper
personal benefit.
We will advance the costs incurred by or on behalf of any director or
officer in connection with any indemnified loss within 20 days after we receive
a detailed statement providing reasonable documentation of such costs and
providing a written undertaking stating that such person will repay all advanced
costs if it is later determined that such individual was entitled to
indemnification by us. We believe that the limitation of liability provision in
our by-laws will facilitate our ability to continue to attract and retain
qualified individuals to serve as directors and officers.
II-1
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
INDEX TO EXHIBITS
NO.
2.1 Third Joint Plan of Reorganization Under Chapter 11 of the Bankruptcy
Code of NextWave Personal Communications Inc., NextWave Power Partners
Inc., NextWave Partners Inc., NextWave Wireless Inc. and NextWave
Telecom Inc., dated January 21, 2005 (incorporated by reference to
Exhibit 2.1 to the Registration Statement on Form 10 of NextWave
Wireless LLC filed May 1, 2006 (the "Form 10"))
3.1 Amended and Restated Certificate of Incorporation of NextWave Wireless
Inc., as restated on November 6, 2006 (incorporated by reference to
Exhibit 3.1 to the Registration Statement on Form S-4/A of NextWave
Wireless Inc. filed November 7, 2006)
3.2 Amended and Restated By-laws of NextWave Wireless Inc., adopted on
October 30, 2007 (incorporated by reference to Exhibit 3.2 to the
Current Report on Form 8-K of NextWave Wireless Inc. filed November 2,
2007)
4.1 Specimen common stock certificate (incorporated by reference to Exhibit
4.1 to the Company's Registration Statement on Form S-4/A filed November
7, 2006)
4.2 Form of Station 4, LLC Warrant (incorporated by reference to Exhibit 4.2
to the Registration Statement on Form 10 of NextWave Wireless LLC filed
May 1, 2006 (the "Form 10"))
4.3 Warrant Agreement, dated as of July 17, 2006, among NextWave Wireless
Inc. and the Holders listed on Schedule I thereto (incorporated by
reference to Exhibit 4.2 to the Current Report on Form 8-K of NextWave
Wireless LLC filed July 21, 2006 (the "July 21, 2006 Form 8- K"))
4.4 Certificate of Designations for NextWave Wireless Inc.'s Series A Senior
Convertible Preferred Stock. (incorporated by reference to Exhibit 4.4
to the Annual Report on Form 10-K of NextWave Wireless Inc. filed March
30, 2007)
4.5 Securities Purchase Agreement, dated March 28, 2007, by and among
NextWave Wireless Inc. and the Purchasers listed on Schedule I thereto
(incorporated by reference to Exhibit 10.19 to the 2006 10-K)
5.1 Opinion of Weil, Gotshal & Manges LLP **
10.1 Agreement and Plan of Merger, dated November 7, 2006, by and among
NextWave Wireless Inc., NextWave Wireless LLC and NextWave Merger LLC
(incorporated by reference to Exhibit 2.1 to the Current Report on Form
8-K of NextWave Wireless Inc. filed November 7, 2006)
10.2 Agreement and Plan of Merger, dated as of December 31, 2006, by and
among NextWave Wireless Inc., Go Acquisition Corp., GO Networks, Inc.
and Nechemia J. Peres, as Stockholder Representative (incorporated by
reference to Exhibit 2.1 to the Current Report on Form 8-K of NextWave
Wireless Inc. filed January 3, 2007).
10.3 Agreement and Plan of Merger, dated as of May 24, 2005, by and among
NextWave Wireless LLC, PVC Acquisition Corp., PacketVideo Corporation
and William D. Cvengros, as the Stockholder Representative (incorporated
by reference to Exhibit 2.2 to Amendment #1 to the Registration
Statement on Form 10 of NextWave Wireless LLC filed June 29, 2006
("Amendment #1 to Form 10")).
10.4 Purchase Agreement, dated as of July 17, 2006, among NextWave Wireless
LLC, as issuer, NextWave Broadband Inc., NW Spectrum Co., AWS Wireless
Inc., and PacketVideo Corporation, as subsidiary guarantors, the note
purchasers party thereto and The Bank of New York, as collateral agent
(incorporated by reference to Exhibit 4.1 to the Current Report on Form
8-K/A of NextWave Wireless LLC filed September 8, 2006)
10.5 Registration Rights Agreement, dated as of July 17, 2006, among NextWave
Wireless Inc. and the Purchasers listed on Schedule I thereto
(incorporated by reference to Exhibit 4.3 to the July 21, 2006 Form 8-K)
10.6 NextWave Wireless Inc. 2005 Stock Incentive Plan (incorporated by
reference to Exhibit 99.1 to the Company's Post-Effective Amendment No.
1 on Form S-8 filed January 19, 2007)
10.7 CYGNUS Communications, Inc. 2004 Stock Option Plan (incorporated by
reference to Exhibit 10.3 to the Form 10)
10.8 PacketVideo Corporation 2005 Equity Incentive Plan (incorporated by
reference to Exhibit 10.2 to the Company's Registration Statement on
Form 10 filed on May 1, 2006)
10.9 NextWave Wireless Inc. 2005 Stock Incentive Plan Award Agreement
(incorporated by reference to Exhibit 99.3 to the Company's Registration
Statement on Form S-8 filed December 7, 2006)
10.10 Acquisition Agreement by and among NextWave Telecom Inc., Cellco
Partnership D/B/A Verizon Wireless and VZW Corp., dated as of November
4, 2004 (incorporated by reference to Exhibit 10.4 to the Form 10)
10.11 Acquisition Agreement, dated as of May 9, 2006, by and among (i)
NextWave Wireless LLC, (ii) NW Spectrum Co., (iii) WCS Wireless, Inc.,
(iv) Columbia WCS III, Inc., (v) TKH Corp., (vi) Columbia Capital Equity
Partners III (Cayman), L.P., the sole stockholder of Columbia WCS III,
Inc., (vii) each of the stockholders of TKH Corp., namely, Aspen
Partners Series A, Series of Aspen Capital Partners, L.P., Oak
Foundation USA, Inc., Enteraspen Limited, and The Reed Institute dba
Reed College and (viii) Columbia Capital, LLC, as the Stockholder
Representative (incorporated by reference to Exhibit 10.7 to Amendment
#1 of the Form 10)
10.12 Spectrum Acquisition Agreement, dated as of October 13, 2005, between
NextWave Broadband Inc. and Bal-Rivgam, LLC (incorporated by reference
to Exhibit 10.8 to Amendment #1 of the Form 10)
10.13 Guaranty, dated as of July 17, 2006, by and among NextWave Broadband,
Inc., NW Spectrum Co., AWS Wireless Inc., PacketVideo Corporation and
The Bank of New York, as Collateral Agent (incorporated by reference to
Exhibit 10.1 to the July 21, 2006 Form 8-K)
10.14 Parent Guaranty, dated as of July 17, 2006, between NextWave Wireless
Inc. and The Bank of New York, as Collateral Agent (incorporated by
reference to Exhibit 10.2 to the July 21, 2006 Form 8-K)
10.16 Pledge and Security Agreement, dated as of July 17, 2006, by and among
NextWave Wireless LLC, the undersigned direct and indirect subsidiaries
of NextWave Wireless LLC, each additional Grantor that may become a
party thereto and The Bank of New York, as Collateral Agent
(incorporated by reference to Exhibit 10.3 to the July 21, 2006 Form
8-K)
10.17 NextWave Wireless Inc. 2007 New Employee Stock Incentive Plan
(incorporated by reference to Exhibit 10.17 to the Annual Report on Form
10-K of NextWave Wireless Inc. filed March 30, 2007)
10.18 GO Networks, Inc. Stock Bonus Plan (incorporated by reference to Exhibit
10.18 to the Annual Report on Form 10-K of NextWave Wireless Inc. filed
March 30, 2007)
10.19 Securities Purchase Agreement, dated March 28, 2007, by and among
NextWave Wireless Inc. and the Purchasers listed on Schedule I (the
"Purchasers") thereto (incorporated by reference to Exhibit 10.19 to the
Annual Report on Form 10-K of NextWave Wireless Inc. filed March 30,
2007)
10.20 Registration Rights Agreement, dated March 28, 2007, among NextWave
Wireless Inc. and the Purchasers (incorporated by reference to Exhibit
10.20 to the Annual Report on Form 10-K of NextWave Wireless Inc. filed
March 30, 2007)
10.21 Agreement and Plan of Merger, dated as of April 6, 2007, by and among
NextWave Wireless Inc., IPW, LLC, IPWireless, Inc. and J. Taylor
Crandall, as Stockholder Representative (incorporated by reference to
Exhibit 2.1 to the Current Report on Form 8-K of NextWave Wireless Inc.
filed April 12, 2007)
10.22 IPWireless, Inc. Employee Stock Bonus Plan (incorporated by reference to
Exhibit 99.1 to the Registration Statement on Form S-8 of NextWave
Wireless Inc. filed July 13, 2007)
10.23 First Amendment to the NextWave Wireless Inc. 2007 New Employee Stock
Incentive Plan (incorporated by reference to Exhibit 99.1 to the
Registration Statement on Form S-8 of NextWave Wireless Inc. filed July
13, 2007)
10.24 First Amendment to the Purchase Agreement, dated March 12, 2008, by and
among NextWave Wireless Inc., NextWave Wireless LLC and the holders
named therein and the guarantors named therein, relating to the
Company's 7% Senior Secured Noted due 2010 (incorporated by reference to
Exhibit 10.24 to the Annual Report on Form 10-K of NextWave Wireless
Inc. filed March 13, 2008)
10.25 Amendment to the IPWireless, Inc. Employee Stock Bonus Plan, dated as of
March 10, 2008 (incorporated by reference to Exhibit 10.25 to the Annual
Report on Form 10-K of NextWave Wireless Inc. filed March 13, 2008)
14.1 NextWave Wireless Inc. Code of Business Conduct and Ethics (available on
the Company's website at http://www.nextwave.com)
21.1 Subsidiaries of the Registrant***
23.1 Consent of Ernst & Young LLP, Independent Registered Public Accounting
Firm**
23.2 Consent of KPMG LLP, Independent Registered Public Accouting Firm**
23.3 Consent of Weil, Gotshal & Manges LLP (included in Exhibit 5.1)**
-----------------
* To be filed by amendment.
** Filed herewith.
*** Incorporated by reference.
ITEM 17. Undertakings
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
II-4
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
posteffective 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) if, in
the aggregate, the changes in volume and price represent no more
than a 20 percent change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement.
Provided, however, that:
Paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not
apply if the Registration Statement is on Form S-3 (ss.239.13 of this
chapter) or Form F-3 (ss.239.33 of this chapter) and the information
required to be included in a post-effective amendment by those paragraphs
is contained in reports filed with or furnished to the 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, or is contained in a form of prospectus filed
pursuant to Rule 424(b) (ss.230.424(b) of this chapter) that is part of
the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of
the offering.
(b) That, for purposes of determining any liability under the Securities Act
of 1933, each filing of the registrant's annual report pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be deemed to
be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the SEC
such indemnification is against public policy as expressed in the Act and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has duly caused this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of New
York, State of New York, on March 21, 2008.
NextWave Wireless Inc.
By: /s/ Frank A. Cassou
------------------------------------------
Frank A. Cassou
Executive Vice President - Corporate Development
and Chief Legal Counsel, Secretary
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned constitutes
and appoints each of Frank A. Cassou, George C. Alex and Roseann Rustici, or any
of them, each acting alone, his true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, for such person and in his name,
place and stead, in any and all capacities, to sign this Registration Statement
on Form S-3 (including all pre-effective and post-effective amendments and
registration statements filed pursuant to Rule 462 under the Securities Act of
1933), and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, each acting alone, full power and authority
to do and perform each and every act and thing requisite and necessary to be
done in and about the premises, as fully to all intents and purposes as he might
or could do in person, hereby ratifying and confirming that any such
attorney-in-fact and agent, or his/her substitute or substitutes, may lawfully
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 by the following persons in the
capacities and on March 21, 2008.
NAME TITLE
/s/ Allen Salmasi Chairman of the Board of Directors, Chief Executive
--------------------------- Officer and President (Principal Executive Officer)
Allen Salmasi
/s/ George C. Alex Executive Vice President - Chief Financial Officer
--------------------------- (Principal Financial Officer)
George C. Alex
Executive Vice President - Corporate Controller
--------------------------- (Principal Accounting Officer)
Francis J. Harding
/s/ James C. Brailean Director
---------------------------
James C. Brailean
Director
---------------------------
William Jones
/s/ Douglas. F. Manchester Director
---------------------------
Douglas F. Manchester
/s/ Jack Rosen Director
---------------------------
Jack Rosen
/s/ Robert T. Symington Director
---------------------------
Robert T. Symington
/s/ William H. Webster Director
---------------------------
William H. Webster
INDEX TO EXHIBITS
NO.
2.1 Third Joint Plan of Reorganization Under Chapter 11 of the Bankruptcy
Code of NextWave Personal Communications Inc., NextWave Power Partners
Inc., NextWave Partners Inc., NextWave Wireless Inc. and NextWave
Telecom Inc., dated January 21, 2005 (incorporated by reference to
Exhibit 2.1 to the Registration Statement on Form 10 of NextWave
Wireless LLC filed May 1, 2006 (the "Form 10"))
3.1 Amended and Restated Certificate of Incorporation of NextWave Wireless
Inc., as restated on November 6, 2006 (incorporated by reference to
Exhibit 3.1 to the Registration Statement on Form S-4/A of NextWave
Wireless Inc. filed November 7, 2006)
3.2 Amended and Restated By-laws of NextWave Wireless Inc., adopted on
October 30, 2007 (incorporated by reference to Exhibit 3.2 to the
Current Report on Form 8-K of NextWave Wireless Inc. filed November 2,
2007)
4.1 Specimen common stock certificate (incorporated by reference to Exhibit
4.1 to the Company's Registration Statement on Form S-4/A filed November
7, 2006)
4.2 Form of Station 4, LLC Warrant (incorporated by reference to Exhibit 4.2
to the Registration Statement on Form 10 of NextWave Wireless LLC filed
May 1, 2006 (the "Form 10"))
4.3 Warrant Agreement, dated as of July 17, 2006, among NextWave Wireless
Inc. and the Holders listed on Schedule I thereto (incorporated by
reference to Exhibit 4.2 to the Current Report on Form 8-K of NextWave
Wireless LLC filed July 21, 2006 (the "July 21, 2006 Form 8- K"))
4.4 Certificate of Designations for NextWave Wireless Inc.'s Series A Senior
Convertible Preferred Stock. (incorporated by reference to Exhibit 4.4
to the Annual Report on Form 10-K of NextWave Wireless Inc. filed March
30, 2007)
4.5 Securities Purchase Agreement, dated March 28, 2007, by and among
NextWave Wireless Inc. and the Purchasers listed on Schedule I thereto
(incorporated by reference to Exhibit 10.19 to the 2006 10-K)
5.1 Opinion of Weil, Gotshal & Manges LLP **
10.1 Agreement and Plan of Merger, dated November 7, 2006, by and among
NextWave Wireless Inc., NextWave Wireless LLC and NextWave Merger LLC
(incorporated by reference to Exhibit 2.1 to the Current Report on Form
8-K of NextWave Wireless Inc. filed November 7, 2006)
10.2 Agreement and Plan of Merger, dated as of December 31, 2006, by and
among NextWave Wireless Inc., Go Acquisition Corp., GO Networks, Inc.
and Nechemia J. Peres, as Stockholder Representative (incorporated by
reference to Exhibit 2.1 to the Current Report on Form 8-K of NextWave
Wireless Inc. filed January 3, 2007).
10.3 Agreement and Plan of Merger, dated as of May 24, 2005, by and among
NextWave Wireless LLC, PVC Acquisition Corp., PacketVideo Corporation
and William D. Cvengros, as the Stockholder Representative (incorporated
by reference to Exhibit 2.2 to Amendment #1 to the Registration
Statement on Form 10 of NextWave Wireless LLC filed June 29, 2006
("Amendment #1 to Form 10")).
10.4 Purchase Agreement, dated as of July 17, 2006, among NextWave Wireless
LLC, as issuer, NextWave Broadband Inc., NW Spectrum Co., AWS Wireless
Inc., and PacketVideo Corporation, as subsidiary guarantors, the note
purchasers party thereto and The Bank of New York, as collateral agent
(incorporated by reference to Exhibit 4.1 to the Current Report on Form
8-K/A of NextWave Wireless LLC filed September 8, 2006)
10.5 Registration Rights Agreement, dated as of July 17, 2006, among NextWave
Wireless Inc. and the Purchasers listed on Schedule I thereto
(incorporated by reference to Exhibit 4.3 to the July 21, 2006 Form 8-K)
10.6 NextWave Wireless Inc. 2005 Stock Incentive Plan (incorporated by
reference to Exhibit 99.1 to the Company's Post-Effective Amendment No.
1 on Form S-8 filed January 19, 2007)
10.7 CYGNUS Communications, Inc. 2004 Stock Option Plan (incorporated by
reference to Exhibit 10.3 to the Form 10)
10.8 PacketVideo Corporation 2005 Equity Incentive Plan (incorporated by
reference to Exhibit 10.2 to the Company's Registration Statement on
Form 10 filed on May 1, 2006)
10.9 NextWave Wireless Inc. 2005 Stock Incentive Plan Award Agreement
(incorporated by reference to Exhibit 99.3 to the Company's Registration
Statement on Form S-8 filed December 7, 2006)
10.10 Acquisition Agreement by and among NextWave Telecom Inc., Cellco
Partnership D/B/A Verizon Wireless and VZW Corp., dated as of November
4, 2004 (incorporated by reference to Exhibit 10.4 to the Form 10)
10.11 Acquisition Agreement, dated as of May 9, 2006, by and among (i)
NextWave Wireless LLC, (ii) NW Spectrum Co., (iii) WCS Wireless, Inc.,
(iv) Columbia WCS III, Inc., (v) TKH Corp., (vi) Columbia Capital Equity
Partners III (Cayman), L.P., the sole stockholder of Columbia WCS III,
Inc., (vii) each of the stockholders of TKH Corp., namely, Aspen
Partners Series A, Series of Aspen Capital Partners, L.P., Oak
Foundation USA, Inc., Enteraspen Limited, and The Reed Institute dba
Reed College and (viii) Columbia Capital, LLC, as the Stockholder
Representative (incorporated by reference to Exhibit 10.7 to Amendment
#1 of the Form 10)
10.12 Spectrum Acquisition Agreement, dated as of October 13, 2005, between
NextWave Broadband Inc. and Bal-Rivgam, LLC (incorporated by reference
to Exhibit 10.8 to Amendment #1 of the Form 10)
10.13 Guaranty, dated as of July 17, 2006, by and among NextWave Broadband,
Inc., NW Spectrum Co., AWS Wireless Inc., PacketVideo Corporation and
The Bank of New York, as Collateral Agent (incorporated by reference to
Exhibit 10.1 to the July 21, 2006 Form 8-K)
10.14 Parent Guaranty, dated as of July 17, 2006, between NextWave Wireless
Inc. and The Bank of New York, as Collateral Agent (incorporated by
reference to Exhibit 10.2 to the July 21, 2006 Form 8-K)
10.16 Pledge and Security Agreement, dated as of July 17, 2006, by and among
NextWave Wireless LLC, the undersigned direct and indirect subsidiaries
of NextWave Wireless LLC, each additional Grantor that may become a
party thereto and The Bank of New York, as Collateral Agent
(incorporated by reference to Exhibit 10.3 to the July 21, 2006 Form
8-K)
10.17 NextWave Wireless Inc. 2007 New Employee Stock Incentive Plan
(incorporated by reference to Exhibit 10.17 to the Annual Report on Form
10-K of NextWave Wireless Inc. filed March 30, 2007)
10.18 GO Networks, Inc. Stock Bonus Plan (incorporated by reference to Exhibit
10.18 to the Annual Report on Form 10-K of NextWave Wireless Inc. filed
March 30, 2007)
10.19 Securities Purchase Agreement, dated March 28, 2007, by and among
NextWave Wireless Inc. and the Purchasers listed on Schedule I (the
"Purchasers") thereto (incorporated by reference to Exhibit 10.19 to the
Annual Report on Form 10-K of NextWave Wireless Inc. filed March 30,
2007)
10.20 Registration Rights Agreement, dated March 28, 2007, among NextWave
Wireless Inc. and the Purchasers (incorporated by reference to Exhibit
10.20 to the Annual Report on Form 10-K of NextWave Wireless Inc. filed
March 30, 2007)
10.21 Agreement and Plan of Merger, dated as of April 6, 2007, by and among
NextWave Wireless Inc., IPW, LLC, IPWireless, Inc. and J. Taylor
Crandall, as Stockholder Representative (incorporated by reference to
Exhibit 2.1 to the Current Report on Form 8-K of NextWave Wireless Inc.
filed April 12, 2007)
10.22 IPWireless, Inc. Employee Stock Bonus Plan (incorporated by reference to
Exhibit 99.1 to the Registration Statement on Form S-8 of NextWave
Wireless Inc. filed July 13, 2007)
10.23 First Amendment to the NextWave Wireless Inc. 2007 New Employee Stock
Incentive Plan (incorporated by reference to Exhibit 99.1 to the
Registration Statement on Form S-8 of NextWave Wireless Inc. filed July
13, 2007)
10.24 First Amendment to the Purchase Agreement, dated March 12, 2008, by and
among NextWave Wireless Inc., NextWave Wireless LLC and the holders
named therein and the guarantors named therein, relating to the
Company's 7% Senior Secured Noted due 2010 (incorporated by reference to
Exhibit 10.24 to the Annual Report on Form 10-K of NextWave Wireless
Inc. filed March 13, 2008)
10.25 Amendment to the IPWireless, Inc. Employee Stock Bonus Plan, dated as of
March 10, 2008 (incorporated by reference to Exhibit 10.25 to the Annual
Report on Form 10-K of NextWave Wireless Inc. filed March 13, 2008)
14.1 NextWave Wireless Inc. Code of Business Conduct and Ethics (available on
the Company's website at http://www.nextwave.com)
21.1 Subsidiaries of the Registrant***
23.1 Consent of Ernst & Young LLP, Independent Registered Public Accounting
Firm**
23.2 Consent of KPMG LLP, Independent Registered Public Accouting Firm**
23.3 Consent of Weil, Gotshal & Manges LLP (included in Exhibit 5.1)**
-----------------
* To be filed by amendment.
** Filed herewith.
*** Incorporated by reference.