As filed
with the Securities and Exchange Commission on March 18, 2008
Registration
Number 333-
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
S-3
REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933
WPCS
INTERNATIONAL INCORPORATED
(Exact
Name of Registrant as Specified in its Charter)
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Delaware
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98-0204758
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(State
or other jurisdiction
of
incorporation or organization)
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(I.R.S.
Employer)
Identification
No.)
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One
East Uwchlan Avenue
Suite
301
Exton,
PA 19341
(610)
903-0400
(Address,
including zip code, and telephone number,
including
area code of registrant’s principal executive offices)
Andrew
Hidalgo, Chief Executive Officer
One
East Uwchlan Avenue
Suite
301
Exton,
PA 19341
(610)
903-0400
(Name,
address, including zip code, and telephone number, including area code of agent
for service)
Copies
to:
Marc J.
Ross, Esq.
Thomas A.
Rose, Esq.
James M.
Turner, Esq.
Sichenzia
Ross Friedman Ference LLP
61
Broadway, 32nd
Floor
New York,
New York 10006
(212)
930-9700
(212)
930-9724 (Fax)
Approximate
date of commencement of proposed sale to the public: From time to time after the
effective date of this Registration Statement.
If the
only securities being registered on this form are to be offered pursuant to
dividend or interest reinvestment plans, please check the following box. o
If any of
the securities being registered on this Form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933, other
than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. x
If this
form is filed to register additional securities for an offering pursuant to Rule
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. o
If this
form is a post-effective amendment filed pursuant to Rule 462(c) 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. o
If this
Form is a registration statement pursuant to General Instruction I.D. or a post
effective amendment thereto that shall become effective upon filing with the
Commission pursuant to Rule 462(e) under the Securities Act, check the following
box. o
If this
Form is a post-effective amendment to a registration statement filed pursuant to
General Instruction I.D. filed to register additional securities or additional
classes of securities pursuant to Rule 413(b) under the Securities Act, check
the following box. o
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Title
of Each Class Of
Securities
To Be Registered
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Amount
To Be
Registered
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Proposed
Maximum
Offering
Price
Per
Security (1)
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Proposed
Maximum
Aggregate
Offering
Price
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Amount
Of
Registration
Fee
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Common
Stock, par value $0.0001 per share
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165,739 |
(2 |
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$ |
5.60 |
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$ |
928,138.40 |
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$ |
36.48 |
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Total
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165,739 |
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$ |
928,138.40 |
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$ |
36.48 |
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(1)
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Estimated
in accordance with Rule 457(c) of the Securities Act, based on the average
of the high and low prices as reported on The Nasdaq Global Market on
March 17, 2008.
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(2)
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Represents
shares issued in November 2007 and February 2008 in connection with our
acquisition of Voacolo Electric Incorporated and Major Electric,
Inc.
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The registrant hereby amends
this registration statement on such date or date(s) 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, as amended, or until the registration statement
shall become effective on such date as the Commission acting pursuant to
said Section 8(a) may determine.
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The
information in this prospectus is not complete and may be changed. The
securities may not be sold until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
SUBJECT
TO COMPLETION, DATED MARCH 18, 2008
PROSPECTUS
WPCS
INTERNATIONAL INCORPORATED
165,739 Shares
of Common Stock
This
prospectus relates to 165,739 shares of our common stock, par value $.0001
per share for sale from time to time by the selling stockholders identified in
this prospectus.
We will
not receive any of the proceeds from the sale of the shares sold pursuant to
this prospectus. We will bear all expenses in connection with the registration
of the shares, other than underwriting discounts and selling
commissions.
Our
common stock is traded on the NASDAQ Global Market under the symbol “WPCS.” On
March 17, 2008, the last reported sale price of our common stock on the NASDAQ
Global Market was $5.57 per share.
The securities offered in this
prospectus involve a high degree of risk. See "Risk Factors" beginning on
page 3 of this prospectus to read about factors you should consider before
buying shares of our common stock.
The
selling stockholders are offering these shares of common stock. The selling
stockholders may sell all or a portion of these shares from time to time in
market transactions through any market on which our common stock is then traded,
in negotiated transactions or otherwise, and at prices and on terms that will be
determined by the then prevailing market price or at negotiated prices directly
or through a broker or brokers, who may act as agent or as principal or by a
combination of such methods of sale. The selling stockholders will receive all
proceeds from the sale of the common stock. For additional information on the
methods of sale, you should refer to the section entitled "Plan of
Distribution."
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined whether this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date
of this Prospectus is ____, 2008
TABLE
OF CONTENTS
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Summary
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1
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Risk
Factors
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4
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Forward-Looking
Statements
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10
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Use
of Proceeds
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10
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Selling
Stockholders
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11
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Plan
of Distribution
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12
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Legal
Matters
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13
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Experts
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13
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Where
You Can Find More Information
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14
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Incorporation
of Documents By Reference
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15
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You
should rely only on the information contained in this prospectus. We have not
authorized anyone to provide you with information that is different. This
prospectus is not an offer to sell, nor is it seeking an offer to buy, these
securities in any jurisdiction where the offer or sale of these securities is
not permitted. You should assume that the information contained in this
prospectus is accurate as of the date on the front of this prospectus only. Our
business, financial condition, results of operations and prospects may have
changed since that date.
This
summary highlights information contained elsewhere in this prospectus. This
summary does not contain all of the information that you should consider before
investing in our common stock. You should read the entire prospectus carefully,
including the section entitled “Risk Factors” included elsewhere in this
prospectus, before making an investment decision. Unless the context clearly
indicates otherwise, references in this prospectus to “we,” “us,” “our” and
“WPCS” refer to WPCS International Incorporated and its subsidiaries on a
consolidated basis.
Our
Company
WPCS
International Incorporated provides design-build engineering services that focus
on the implementation requirements of wireless networks. We serve the specialty
communication systems and wireless infrastructure sectors. Specialty
communication systems are wireless networks designed to improve productivity for
a specified application by communicating data, voice or video information in
situations where land line networks are non-existent, more difficult to deploy
or too expensive. Wireless infrastructure services include the engineering,
installation, integration and maintenance of wireless carrier equipment. We
provide services that include site design, technology integration, electrical
contracting, construction, and project management for corporations, government
entities and educational institutions worldwide.
Wireless
technology has advanced substantially to the point where wireless networks have
proven to be an effective alternative to land line networks, a key factor in
wireless’ broad acceptance. We believe that the advantages of wireless over land
line communication are apparent in the aspects of mobility, capacity, cost, and
deployment. We believe the use of dedicated wireless networks for specified
applications has improved productivity for individuals and organizations alike.
Demand for wireless data services is accelerating the adoption of new
technologies that enable wireless networks to deliver enhanced features and
capabilities. These new technologies have increased the complexity of wireless
systems, and created demand for the services of companies such as ours with
specialized skills to address that complexity.
With 15
offices across the United States, one office in Australia and one office in
China, we provide our services to our customers nationwide, in Australia and in
the People’s Republic of China. Because we are technology and vendor
independent, we can integrate multiple products and services across a variety of
communication requirements. This ability gives our customers the flexibility to
obtain the most appropriate solution for their communication needs on a cost
effective basis. Wireless communication is primarily achieved through radio
frequency, or RF, signals. We have extensive experience in RF engineering, a
necessary skill in designing wireless networks free from interference with other
signals and amplified sufficiently to carry data, voice or video with speed,
accuracy and reliability. We believe the strength of our experience in the
design and deployment of specialty communication systems gives us a competitive
advantage, and has supported our rapid growth, both organically and through
acquisitions.
Our goal
is to become a recognized leader in the design and deployment of wireless
networks for specialty communication systems and wireless infrastructure. For
the fiscal year ended April 30, 2007, we generated revenues of approximately $70
million, an increase of 34.2% from the fiscal year ended April 30, 2006. For the
nine months ended January 31, 2008, we generated revenues of approximately $74.7
million, an increase of 42.8% from the nine months ended January 31, 2007. Our
backlog at January 31, 2008 was approximately $66.6 million.
Our
Strategy
Our
strategy focuses on both organic growth and the pursuit of acquisitions that add
to our engineering capacity and geographic coverage. Specifically, we will
endeavor to:
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• Increase customer awareness by
marketing the full range of our services to our
customers;
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• Maintain and expand our focus in
existing vertical markets such as public safety and gaming, and develop
expertise in new vertical
markets;
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• Strengthen our relationships with
technology providers whose products offer benefits to our customers;
and
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• Seek strategic acquisitions of
compatible businesses that can be assimilated into our organization and
that will add accretive earnings to our
business.
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Our
Customers
Our
customers include corporations, government entities and educational institutions
in various market segments. In our specialty communication systems segment, we
believe our design and deployment of innovative wireless networks specific to
the needs of customers in certain vertical markets has brought us recognition in
these markets. In our wireless infrastructure services segment, our customers
are major wireless carriers.
Risks
Affecting Us
Our
business is subject to numerous risks, as discussed more fully in the section
entitled “Risk Factors” immediately following this prospectus summary,
including:
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Our
success is dependent on growth in the deployment of wireless networks, and
to the extent that such growth slows, our revenues may decrease and our
ability to continue operating profitably may be
harmed;
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We
have a limited history of profitability which may not
continue;
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If
we fail to accurately estimate costs associated with our fixed-price
contracts using percentage-of-completion, our actual results may vary from
our assumptions, which may reduce our profitability or impair our
financial performance;
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Failure
to properly manage projects may result in unanticipated costs or
claims;
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The
industry in which we operate has relatively low barriers to entry and
increased competition could result in margin erosion, which would make
profitability even more difficult to
sustain;
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Our
business depends upon our ability to keep pace with the latest
technological changes, and our failure to do so could make us less
competitive in our industry;
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Our
failure to attract and retain engineering personnel or maintain
appropriate staffing levels could adversely affect our
business;
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If
we are unable to identify and complete future acquisitions, we may be
unable to continue our growth;
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Future
acquired companies could be difficult to assimilate, disrupt our business,
diminish stockholder value and adversely affect our operating
results;
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We
derive a significant portion of our revenues from a limited number of
customers, the loss of which would significantly reduce our revenues;
and
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Amounts
included in our backlog may not result in actual revenue or translate into
profits.
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Our
Corporate Information
We have 13 operating subsidiaries:
Clayborn Contracting Group, Inc., a California corporation; Heinz Corporation, a
Missouri corporation; Gomes and Gomes, Inc. dba Empire Electric, a California
corporation; Invisinet, Inc., a Delaware corporation; James Design Pty Ltd, an
Australia corporation; Major Electric, Inc., a Washington
corporation; Max Engineering LLC, a Texas limited liability company; New England
Communications Systems, Inc., a Connecticut corporation; Quality Communications
& Alarm Company, Inc., a New Jersey corporation; Southeastern Communication
Service, Inc., a Florida corporation; Taian AGS Pipeline Construction Co. Ltd.,
a joint venture enterprise in the City of Taian, Shandong province, the People's
Republic of China; Voacolo Electric Incorporated, a New Jersey corporation; and
Walker Comm, Inc., a California corporation. References in this prospectus to
Clayborn, Heinz, Empire, Invisinet, James, Major Electric, Max Engineering,
NECS, Quality, SECS, TAGS, Voacolo, and Walker Comm refer to these companies,
respectively.
Our
principal executive offices are located at One East Uwchlan Avenue, Suite 301,
Exton, Pennsylvania 19341, and our telephone number is (610) 903-0400. We are a
Delaware corporation. We maintain a website at www.wpcs.com and the information
contained on that website is not deemed to be a part of this
prospectus.
Recent
Developments
Empire
Acquisition
On
November 1, 2007, we acquired Gomes and Gomes, Inc. dba Empire Electric, a
California corporation. The aggregate consideration paid to the Empire selling
shareholders, including acquisition transaction costs of $31,029, was
$1,856,029, of which $1,825,000 was paid in cash, subject to adjustment. In
addition, we shall pay an additional $1,000,000 in cash if Empire’s earnings
before interest and taxes for the year ending October 31, 2007 shall equal or
exceed $850,000. We expect to settle the earnout payment by March 31, 2008.
Empire was acquired pursuant to a Stock Purchase Agreement between us and the
former shareholders of Empire, dated as of November 1, 2007. In connection with
the acquisition, Empire entered into employment agreements with the former
shareholders for a period of two years. The acquisition of Empire expands our
presence in California and provides additional electrical contracting services
that specialize in low voltage applications for healthcare, state government and
military customers.
James
Acquisition
On
November 30, 2007, we acquired James. The aggregate consideration paid by us to
the James selling shareholders, including acquisition transaction costs of
$65,625, was $1,145,625, of which $1,080,000 was paid in cash, subject to
adjustment. James was acquired pursuant to a Stock Purchase Agreement between us
and the former shareholders of James, dated as of November 30, 2007. In
connection with the acquisition, we entered into an employment agreement with
the former president for a period of two years.
James is
a design engineering services company specializing in building automation
including mechanical, electrical, hydraulic, fire protection, lift, security
access and wireless systems. The acquisition of James provides us international
expansion into Australia consistent with our emphasis on Australia, China and
surrounding Pacific Rim countries.
RISK
FACTORS
This
investment has a high degree of risk. Before you invest you should carefully
consider the risks and uncertainties described below and the other information
in this prospectus. If any of the following risks actually occur, our business,
operating results and financial condition could be harmed and the value of our
stock could go down. As a result, you could lose all or a part of your
investment.
Customers
are constantly re-evaluating their network deployment plans in response to
trends in the capital markets, changing perceptions regarding industry growth,
the adoption of new wireless technologies, increasing pricing competition and
general economic conditions in the United States and internationally. If the
rate of network deployment growth slows and customers reduce their capital
investments in wireless technology or fail to expand their networks, our
revenues and profits could be reduced.
We
have a limited history of profitability which may not continue.
While we
had a net income of approximately $4.6 million for the fiscal year ended April
30, 2007, we incurred a net loss of approximately $1.6 million for the fiscal
year ending April 30, 2006. For the nine months ended January 31, 2008, we had
net income of approximately $3.16 million compared to net income of
approximately $3.23 million for the nine months ended January 31, 2007. There
can be no assurance that we will sustain profitability or generate positive cash
flow from operating activities in the future. If we cannot achieve operating
profitability or positive cash flow from operating activities, we may not be
able to meet our working capital requirements. If we are unable to meet our
working capital requirements, we may need to reduce or cease all or part of our
operations.
If
we fail to accurately estimate costs associated with our fixed-price contracts
using percentage-of-completion, our actual results may vary from our
assumptions, which may reduce our profitability or impair our financial
performance.
A
substantial portion of our revenue is derived from fixed price contracts. Under
these contracts, we set the price of our services on an aggregate basis and
assume the risk that the costs associated with our performance may be greater
than we anticipated. We recognize revenue and profit on these contracts as the
work on these projects progresses on a percentage-of-completion basis. Under the
percentage-of-completion method, contracts in process are valued at cost plus
accrued profits less earned revenues and progress payments on uncompleted
contracts.
The
percentage-of-completion method therefore relies on estimates of total expected
contract costs. These costs may be affected by a variety of factors, such as
lower than anticipated productivity, conditions at work sites differing
materially from what was anticipated at the time we bid on the contract and
higher costs of materials and labor. Contract revenue and total cost estimates
are reviewed and revised monthly as the work progresses, such that adjustments
to profit resulting from revisions are made cumulative to the date of the
revision. Adjustments are reflected in contract revenue for the fiscal period
affected by these revised estimates. If estimates of costs to complete long-term
contracts indicate a loss, we immediately recognize the full amount of the
estimated loss. Such adjustments and accrued losses could result in reduced
profitability and liquidity.
Failure
to properly manage projects may result in unanticipated costs or
claims.
Our
wireless network engagements may involve large scale, highly complex projects.
The quality of our performance on such projects depends in large part upon our
ability to manage the relationship with our customers, and to effectively manage
the project and deploy appropriate resources, including third-party contractors
and our own personnel, in a timely manner. Any defects or errors or failure to
meet customers’ expectations could result in claims for substantial damages
against us. Our contracts generally limit our liability for damages that arise
from negligent acts, errors, mistakes or omissions in rendering services to our
customers. However, we cannot be sure that these contractual provisions will
protect us from liability for damages in the event we are sued. In addition, in
certain instances, we guarantee customers that we will complete a project by a
scheduled date or that the network will achieve certain performance standards.
If the project or network experiences a performance problem, we may not be able
to recover the additional costs we would incur, which could exceed revenues
realized from a project.
The
industry in which we operate has relatively low barriers to entry and increased
competition could result in margin erosion, which would make profitability even
more difficult to sustain.
Other
than the technical skills required in our business, the barriers to entry in our
business are relatively low. We do not have any intellectual property rights to
protect our business methods and business start-up costs do not pose a
significant barrier to entry. The success of our business is dependent on our
employees, customer relations and the successful performance of our services. If
we face increased competition as a result of new entrants in our markets, we
could experience reduced operating margins and loss of market share and brand
recognition.
Our
business depends upon our ability to keep pace with the latest technological
changes, and our failure to do so could make us less competitive in our
industry.
The
market for our services is characterized by rapid change and technological
improvements. Failure to respond in a timely and cost-effective way to these
technological developments may result in serious harm to our business and
operating results. We have derived, and we expect to continue to derive, a
substantial portion of our revenues from deploying wireless networks that are
based upon today’s leading technologies and that are capable of adapting to
future technologies. As a result, our success will depend, in part, on our
ability to develop and market service offerings that respond in a timely manner
to the technological advances of our customers, evolving industry standards and
changing preferences.
Our
failure to attract and retain engineering personnel or maintain appropriate
staffing levels could adversely affect our business.
Our
success depends upon our attracting and retaining skilled engineering personnel.
Competition for such skilled personnel in our industry is high and at times can
be extremely intense, especially for engineers and project managers, and we
cannot be certain that we will be able to hire sufficiently qualified personnel
in adequate numbers to meet the demand for our services. We also believe that
our success depends to a significant extent on the ability of our key personnel
to operate effectively, both individually and as a group. Additionally, we
cannot be certain that we will be able to hire the requisite number of
experienced and skilled personnel when necessary in order to service a major
contract, particularly if the market for related personnel is competitive.
Conversely, if we maintain or increase our staffing levels in anticipation of
one or more projects and the projects are delayed, reduced or terminated, we may
underutilize the additional personnel, which could reduce our operating margins,
reduce our earnings and possibly harm our results of operations. If we are
unable to obtain major contracts or effectively complete such contracts due to
staffing deficiencies, our revenues may decline and we may experience a drop in
net income.
If
we are unable to identify and complete future acquisitions, we may be unable to
continue our growth.
Since
November 1, 2001, we have acquired 13 companies and we intend to further expand
our operations through targeted strategic acquisitions. However, we may not be
able to identify suitable acquisition opportunities. Even if we identify
favorable acquisition targets, there is no guarantee that we can acquire them on
reasonable terms or at all. If we are unable to complete attractive
acquisitions, the growth that we have experienced over the last five fiscal
years may decline.
Future
acquired companies could be difficult to assimilate, disrupt our business,
diminish stockholder value and adversely affect our operating
results.
Completing
acquisitions may require significant management time and financial resources
because we may need to assimilate widely dispersed operations with distinct
corporate cultures. Our failure to manage future acquisitions successfully could
seriously harm our operating results. Also, acquisitions could cause our
quarterly operating results to vary significantly. Furthermore, our stockholders
would be diluted if we financed the acquisitions by issuing equity securities.
In addition, acquisitions expose us to risks such as undisclosed liabilities,
increased indebtedness associated with an acquisition and the potential for cash
flow shortages that may occur if anticipated financial performance is not
realized or is delayed from such acquired companies.
We
derive a significant portion of our revenues from a limited number of customers,
the loss of which would significantly reduce our revenues.
We have
derived, and believe that we will continue to derive, a significant portion of
our revenues from a limited number of customers. To the extent that any
significant customer uses less of our services or terminates its relationship
with us, our revenues could decline significantly. As a result, the loss of any
significant customer could seriously harm our business. For the fiscal year
ended April 30, 2007, we had two separate customers which accounted for 18.1%
and 11.7% of our revenues. For the fiscal year ended April 30, 2006,
we had two separate customers which accounted for 20.8% and 14.5% of our
revenues. Other than under existing contractual obligations, none of our
customers is obligated to purchase additional services from us. As a result, the
volume of work that we perform for a specific customer is likely to vary from
period to period, and a significant customer in one period may not use our
services in a subsequent period.
Amounts
included in our backlog may not result in actual revenue or translate into
profits.
As of
January 31, 2008, we had a backlog of unfilled orders of approximately $66.6
million. This backlog amount is based on contract values and purchase orders and
may not result in actual receipt of revenue in the originally anticipated period
or at all. In addition, contracts included in our backlog may not be profitable.
We have experienced variances in the realization of our backlog because of
project delays or cancellations resulting from external market factors and
economic factors beyond our control and we may experience delays or
cancellations in the future. If our backlog fails to materialize, we could
experience a reduction in revenue, profitability and liquidity.
Our
business could be affected by adverse weather conditions, resulting in variable
quarterly results.
Adverse
weather conditions, particularly during the winter season, could affect our
ability to perform outdoor services in certain regions of the United States. As
a result, we might experience reduced revenue in the third and fourth quarters
of our fiscal year. Natural catastrophes could also have a negative impact on
the economy overall and on our ability to perform outdoor services in affected
regions or utilize equipment and crews stationed in those regions, which in turn
could significantly impact the results of any one or more of our reporting
periods.
If
we are unable to retain the services of Messrs. Hidalgo, Schubiger, Heinz,
Walker, Madenford or James, operations could be disrupted.
Our
success depends to a significant extent upon the continued services of Mr.
Andrew Hidalgo, our Chief Executive Officer and Messrs. Richard Schubiger, James
Heinz, Donald Walker, Charles Madenford and Steven James, our Executive Vice
Presidents. Mr. Hidalgo has overseen our company since inception and provides
leadership for our growth and operations strategy. Messrs. Schubiger, Heinz,
Walker, Madenford and James oversee the day-to-day operations of our operating
subsidiaries. Loss of the services of Messrs. Hidalgo, Schubiger, Heinz, Walker,
Madenford or James could disrupt our operations and harm our growth, revenues,
and prospective business. We do not maintain key-man insurance on the lives of
Messrs. Hidalgo, Schubiger, Heinz, Walker, Madenford or James.
Employee
strikes and other labor-related disruptions may adversely affect our
operations.
Our
business is labor intensive, with certain projects requiring large numbers of
engineers. Over 44% of our workforce is unionized. Strikes or labor disputes
with our unionized employees may adversely affect our ability to conduct our
business. If we are unable to reach agreement with any of our unionized work
groups on future negotiations regarding the terms of their collective bargaining
agreements, or if additional segments of our workforce become unionized, we may
be subject to work interruptions or stoppages. Any of these events could be
disruptive to our operations and could result in negative publicity, loss of
contracts and a decrease in revenues.
We
may incur goodwill impairment charges in our reporting entities which could harm
our profitability.
In
accordance with Statement of Financial Accounting Standards, or SFAS, No. 142,
“Goodwill and Other Intangible Assets,” we periodically review the carrying
values of our goodwill to determine whether such carrying values exceed the fair
market value. Each of our acquired companies is subject to annual review for
goodwill impairment. If impairment testing indicates that the carrying value of
a reporting unit exceeds its fair value, the goodwill of the reporting unit is
deemed impaired. Accordingly, an impairment charge would be recognized for that
reporting unit in the period identified, which could reduce our
profitability.
Our
quarterly results fluctuate and may cause our stock price to
decline.
Our
quarterly operating results have fluctuated in the past and will likely
fluctuate in the future. As a result, we believe that period to period
comparisons of our results of operations are not a good indication of our future
performance. A number of factors, many of which are beyond our control, are
likely to cause these fluctuations. Some of these factors include:
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the
timing and size of network deployments and technology upgrades by our
customers;
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fluctuations
in demand for outsourced network
services;
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the
ability of certain customers to sustain capital resources to pay their
trade accounts receivable balances and required changes to our allowance
for doubtful accounts based on periodic assessments of the collectibility
of our accounts receivable
balances;
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reductions
in the prices of services offered by our
competitors;
|
|
|
•
|
our
success in bidding on and winning new business;
and
|
|
|
•
|
our
sales, marketing and administrative cost
structure.
|
Because
our operating results may vary significantly from quarter to quarter, our
operating results may not meet the expectations of securities analysts and
investors, and our common stock could decline significantly which may expose us
to risks of securities litigation, impair our ability to attract and retain
qualified individuals using equity incentives and make it more difficult to
complete acquisitions using equity as consideration.
Our
stock price may be volatile, which may result in lawsuits against us and our
officers and directors.
The stock
market in general, and the stock prices of technology and telecommunications
companies in particular, have experienced volatility that has often been
unrelated to or disproportionate to the operating performance of those
companies. The market price of our common stock has fluctuated in the past and
is likely to fluctuate in the future. Between March 1, 2007 and March 1, 2008,
our common stock has traded as low as $6.37 and as high as $14.25 per share,
based upon information provided by NASDAQ Capital Market and NASDAQ Global
Market. Factors which could have a significant impact on the market price of our
common stock include, but are not limited to, the following:
|
|
•
|
quarterly
variations in operating results;
|
|
|
•
|
announcements
of new services by us or our
competitors;
|
|
|
•
|
the
gain or loss of significant
customers;
|
|
|
•
|
changes
in analysts’ earnings estimates;
|
|
|
•
|
rumors
or dissemination of false
information;
|
|
|
•
|
short
selling of our common stock;
|
|
|
•
|
general
conditions in the market;
|
|
|
•
|
changing
the exchange or quotation system on which we list our common stock for
trading;
|
|
|
•
|
political
and/or military events associated with current worldwide conflicts;
and
|
|
|
•
|
events
affecting other companies that investors deem comparable to
us.
|
Companies
that have experienced volatility in the market price of their stock have
frequently been the object of securities class action litigation. Class action
and derivative lawsuits could result in substantial costs to us and a diversion
of our management’s attention and resources, which could materially harm our
financial condition and results of operations.
Future
changes in financial accounting standards may adversely affect our reported
results of operations.
A change
in accounting standards could have a significant effect on our reported results
and may even affect our reporting of transactions completed before the change is
effective. New pronouncements and varying interpretations of pronouncements have
occurred and may occur in the future. Changes to existing rules or the
questioning of current practices may adversely affect our reported financial
results or the way we conduct our business.
Compliance
with changing regulation of corporate governance and public disclosure may
result in additional expenses.
Changing
laws, regulations and standards relating to corporate governance and public
disclosure, including the Sarbanes-Oxley Act of 2002, newly enacted SEC
regulations and NASDAQ Stock Market rules, have created additional burdens for
companies such as ours. We are committed to maintaining high standards of
corporate governance and public disclosure. As a result, we intend to invest
appropriate resources to comply with evolving standards. This investment will
result in increased general and administrative costs and a diversion of
management time and attention from revenue-generating activities to compliance
activities.
We
can issue shares of preferred stock without shareholder approval, which could
adversely affect the rights of common shareholders.
Our
certificate of incorporation permits us to establish the rights, privileges,
preferences and restrictions, including voting rights, of future series of our
preferred stock and to issue such stock without approval from our stockholders.
The rights of holders of our common stock may suffer as a result of the rights
granted to holders of preferred stock that we may issue in the future. In
addition, we could issue preferred stock to prevent a change in control of our
company, depriving common shareholders of an opportunity to sell their stock at
a price in excess of the prevailing market price.
There
may be an adverse effect on the market price of our shares as a result of shares
being available for sale in the future.
As of
March 1, 2008, holders of our outstanding options and warrants have the right to
acquire 2,442,531 shares of common stock issuable upon the exercise of stock
options and warrants, at exercise prices ranging from $4.80 to $16.20 per share,
with a weighted average exercise price of $7.04. The sale or availability for
sale in the market of the shares underlying these options and warrants could
depress our stock price. We have registered substantially all of the underlying
shares described above for resale. Holders of registered underlying shares may
resell the shares immediately upon issuance upon exercise of an option or
warrant.
If our
stockholders sell substantial amounts of our shares of common stock, including
shares issued upon the exercise of outstanding options and warrants, the market
price of our common stock may decline. These sales also might make it more
difficult for us to sell equity or equity-related securities in the future at a
time and price that we deem appropriate.
We
are subject to the risks associated with doing business in the People’s Republic
of China (PRC).
We
conduct certain business in China through our TAGS joint venture, which is
organized under the laws of the PRC. Our China operations are directly related
to and dependent on the social, economic and political conditions in this
country, many of which we have no control over, and are influenced by many
factors, including:
|
|
·
|
changes
in the region’s economic, social and political conditions or government
policies;
|
|
|
·
|
changes
in trade laws, tariffs and other trade restrictions or
licenses;
|
|
|
·
|
changes
in foreign exchange regulation in China may limit our ability to freely
convert currency to make dividends or other payments in U.S.
dollars;
|
|
|
·
|
fluctuation
in the value of the RMB (Chinese Yuan) could adversely affect the value of
our investment in China;
|
|
|
·
|
limitations
on the repatriation of earnings or assets, including
cash;
|
|
|
·
|
adverse
changes in tax laws and
regulations;
|
|
|
·
|
difficulties
in managing or overseeing our China operations, including the need to
implement appropriate systems, policies, benefits and compliance programs;
and
|
|
|
·
|
different
liability standards and less developed legal systems that may be less
predictable than those in the United
States.
|
The
occurrence or consequences of any of these conditions may restrict our ability
to operate and/or decrease the profitability our operations in
China.
FORWARD-LOOKING
STATEMENTS
The
Private Securities Litigation Reform Act of 1995 (the "Act") provides a safe
harbor for forward-looking statements made by us or on our behalf. We and our
representatives may from time to time make written or oral statements that are
"forward-looking," including statements contained in this prospectus and other
filings with the Securities and Exchange Commission, reports to our stockholders
and news releases. All statements that express expectations, estimates,
forecasts or projections are forward-looking statements within the meaning of
the Act. In addition, other written or oral statements which constitute
forward-looking statements may be made by us or on our behalf. Words such as
"expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates,"
"projects," "forecasts," "may," "should," variations of such words and similar
expressions are intended to identify such forward-looking statements. These
statements are not guarantees of future performance and involve risks,
uncertainties and assumptions which are difficult to predict. Therefore, actual
outcomes and results may differ materially from what is expressed or forecasted
in or suggested by such forward-looking statements.
USE
OF PROCEEDS
We will
not receive any of the proceeds from the sale of the shares sold pursuant to
this prospectus. We will bear all expenses in connection with the registration
of the shares, other than underwriting discounts and selling
commissions.
The
following table sets forth the common stock ownership of the selling
stockholders as of March 17, 2008. Other than as set forth in the following
table, the selling stockholders have not held any position or office or had any
other material relationship with us or any of our predecessors or affiliates
within the past three years.
|
|
|
Beneficial
Ownership Prior to this Offering (1)
|
|
|
|
Beneficial
Ownership After this Offering (1) ( 2)
|
|
|
|
Selling
Stockholder
|
|
Number
of
Shares
|
|
Percent
of
Class
|
|
Shares
That May be Offered and Sold Hereby
|
|
Number
of
Shares
|
|
Percent
of
Class
|
|
|
|
Frank
Mauger
|
|
233,440
|
|
3.21%
|
|
|
156,516
|
|
|
76,924
|
|
|
1.06%
|
|
|
|
James
Jordan
|
|
4,668
|
|
*
|
|
|
3,130
|
|
|
1,538
|
|
|
*
|
|
|
|
Todd
Kahl
|
|
4,668
|
|
*
|
|
|
3,130
|
|
|
1,538
|
|
|
*
|
|
|
|
Tracy
Hossler
|
|
4,660
|
|
*
|
|
|
119
|
|
|
4,541
|
|
|
*
|
|
|
|
Jeffrey
Voacolo
|
|
37,279
|
|
*
|
|
|
948
|
|
|
36,331
|
|
|
*
|
|
|
|
Joseph
Voacolo
|
|
37,279
|
|
*
|
|
|
948
|
|
|
36,331
|
|
|
*
|
|
|
|
David
Voacolo
|
|
37,279
|
|
*
|
|
|
948
|
|
|
36,331
|
|
|
*
|
|
|
* Less
than 1%.
|
(1)
|
Percentage
calculated on the basis of 7,251,083 shares of common stock
outstanding on March 17, 2008.
|
|
|
|
|
|
|
|
|
(2)
|
Assumes
the sale of all shares of common stock registered pursuant to this
prospectus, although the selling stockholders are under no obligations
known to us to sell any shares of common stock at this
time.
|
|
|
PLAN
OF DISTRIBUTION
The selling stockholders, which as used
herein includes donees, pledgees, transferees or other successors-in-interest
selling shares of common stock or interests in shares of common stock received
after the date of this prospectus from a selling stockholder as a gift, pledge,
partnership distribution or other transfer, may, from time to time, sell,
transfer or otherwise dispose of any or all of their shares of common stock or
interests in shares of common stock on any stock exchange, market or trading
facility on which the shares are traded or in private
transactions. These dispositions may be at fixed prices, at
prevailing market prices at the time of sale, at prices related to the
prevailing market price, at varying prices determined at the time of sale, or at
negotiated prices.
The selling stockholders may use any
one or more of the following methods when disposing of shares or interests
therein:
|
|
-
|
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
|
|
|
-
|
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;
|
|
|
-
|
purchases
by a broker-dealer as principal and resale by the broker-dealer for its
account;
|
|
|
-
|
an
exchange distribution in accordance with the rules of the applicable
exchange;
|
|
|
-
|
privately
negotiated transactions;
|
|
|
-
|
short
sales effected after the date the registration statement of which this
Prospectus is a part is declared effective by the
SEC;
|
|
|
-
|
through
the writing or settlement of options or other hedging transactions,
whether through an options exchange or
otherwise;
|
|
|
-
|
broker-dealers
may agree with the selling stockholders to sell a specified number of such
shares at a stipulated price per
share;
|
|
|
-
|
a
combination of any such methods of sale;
and
|
|
|
-
|
any
other method permitted pursuant to applicable
law.
|
The selling stockholders may, from time
to time, pledge or grant a security interest in some or all of the shares of
common stock owned by them and, if they default in the performance of their
secured obligations, the pledgees or secured parties may offer and sell the
shares of common stock, from time to time, under this prospectus, or under an
amendment to this prospectus under Rule 424(b)(3) or other applicable provision
of the Securities Act amending the list of selling stockholders to include the
pledgee, transferee or other successors in interest as selling stockholders
under this prospectus. The selling stockholders also may transfer the
shares of common stock in other circumstances, in which case the transferees,
pledgees or other successors in interest will be the selling beneficial owners
for purposes of this prospectus.
In connection with the sale of our
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 our 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 aggregate proceeds to the selling
stockholders from the sale of the common stock offered by them will be the
purchase price of the common stock less discounts or commissions, if
any. Each of the selling stockholders reserves the right to accept
and, together with their agents from time to time, to reject, in whole or in
part, any proposed purchase of common stock to be made directly or through
agents. We will not receive any of the proceeds from this offering.
Upon any exercise of the warrants by payment of cash, however, we will receive
the exercise price of the warrants.
The selling stockholders also may
resell all or a portion of the shares in open market transactions in reliance
upon Rule 144 under the Securities Act of 1933, provided that they meet the
criteria and conform to the requirements of that rule.
The selling stockholders and any
underwriters, broker-dealers or agents that participate in the sale of the
common stock or interests therein may be "underwriters" within the meaning of
Section 2(11) of the Securities Act. Any discounts, commissions,
concessions or profit they earn on any resale of the shares may be underwriting
discounts and commissions under the Securities Act. Selling
stockholders who are "underwriters" within the meaning of Section 2(11) of the
Securities Act will be subject to the prospectus delivery requirements of the
Securities Act.
To the extent required, the shares of
our common stock to be sold, the names of the selling stockholders, the
respective purchase prices and public offering prices, the names of any agents,
dealer or underwriter, any applicable commissions or discounts with respect to a
particular offer will be set forth in an accompanying prospectus supplement or,
if appropriate, a post-effective amendment to the registration statement that
includes this prospectus.
In order to comply with the securities
laws of some states, if applicable, the common stock may be sold in these
jurisdictions only through registered or licensed brokers or
dealers. In addition, in some states the common stock may not be sold
unless it has been registered or qualified for sale or an exemption from
registration or qualification requirements is available and is complied
with.
We have advised the selling
stockholders that the anti-manipulation rules of Regulation M under the Exchange
Act may apply to sales of shares in the market and to the activities of the
selling stockholders and their affiliates. In addition, we will make
copies of this prospectus (as it may be supplemented or amended from time to
time) available to the selling stockholders for the purpose of satisfying the
prospectus delivery requirements of the Securities Act. The selling
stockholders may indemnify any broker-dealer that participates in transactions
involving the sale of the shares against certain liabilities, including
liabilities arising under the Securities Act.
We have agreed to indemnify the selling
stockholders against liabilities, including liabilities under the Securities Act
and state securities laws, relating to the registration of the shares offered by
this prospectus.
We have agreed with the selling
stockholders to keep the registration statement of which this prospectus
constitutes a part effective until the earlier of (1) such time as all of the
shares covered by this prospectus have been disposed of pursuant to and in
accordance with the registration statement or (2) the date on which the shares
may be sold pursuant to Rule 144(k) of the Securities Act.
The
validity of the shares of common stock being offered hereby will be passed upon
for us by Sichenzia Ross Friedman Ference LLP, New York, New York.
The
consolidated financial statements of WPCS International Incorporated as of April
30, 2007 and 2006 and for the years ended April 30, 2007, 2006 and 2005
appearing in WPCS International Incorporated’s annual report on Form 10-K for
the year ended April 30, 2007 have been audited by J.H. Cohn LLP, independent
registered public accounting firm, as set forth in their report thereon included
therein and incorporated herein by reference. Such consolidated
financial statements are incorporated herein by reference in reliance upon such
report given on the authority of such firm as experts in accounting and
auditing.
WHERE
YOU CAN FIND MORE INFORMATION
This
prospectus is part of a registration statement that we filed on Form S-3 with
the Securities and Exchange Commission or SEC. This prospectus does not contain
all of the information in the registration statement and the exhibits and
schedules that were filed with the registration statement. You should refer to
the registration statement for additional information about us and the common
stock being offered in this prospectus. Statements made in this prospectus
regarding the contents of any contract, agreement or other document that is
filed as an exhibit to the registration statement or any document incorporated
by reference into the registration statement are not necessarily complete, and
you should review the referenced document itself for a complete understanding of
its terms.
We file
annual, quarterly and special reports, proxy statements and other information
with the SEC. You may read and copy any document that we file at the SEC's
public reference facilities located at 100 F Street, NE, Washington, DC 20549.
Copies of all or any part of the registration statement may be obtained from the
SEC upon payment of the prescribed fee. Information regarding the operation of
the public reference rooms may be obtained by calling the SEC at 1-800-SEC-0330.
Our SEC filings are also available to you free of charge at the SEC's web site
at http://www.sec.gov.
INCORPORATION
OF DOCUMENTS BY REFERENCE
The SEC
allows us to 'incorporate by reference' the information into this prospectus.
This means that we can disclose important information to you by referring you to
another document filed separately with the SEC. The information that we
incorporate by reference is considered to be part of this prospectus. Because we
are incorporating by reference our future filings with the SEC, this prospectus
is continually updated and those future filings may modify or supersede some or
all of the information included or incorporated in this prospectus. This means
that you must look at all of the SEC filings that we incorporate by reference to
determine if any of the statements in this prospectus or in any document
previously incorporated by reference have been modified or superseded. This
prospectus incorporates by reference the documents listed below and any future
filings we will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934 until the selling stockholders sell all of
our common stock registered under this prospectus.
|
|
•
|
our
annual report on Form 10-K for the fiscal year ended April 30, 2007 filed
with the SEC on July 30, 2007;
|
|
|
•
|
our
quarterly report on Form 10-Q for the fiscal quarter ended July 31, 2007,
filed with the SEC on September 14, 2007;
|
|
|
•
|
our
quarterly report on Form 10-Q for the fiscal quarter ended October 31,
2007, filed with the SEC on December 17, 2007;
|
|
|
•
|
our
quarterly report on Form 10-Q for the fiscal quarter ended January 31,
2008, filed with the SEC on March 17, 2008;
|
|
|
•
|
our
current report on Form 8-K, filed with the SEC on July 30,
2007;
|
|
|
•
|
our
current report on Form 8-K, filed with the SEC on August 7,
2007;
|
|
|
•
|
our
current report on Form 8-K, filed with the SEC on September 14,
2007;
|
|
|
•
|
our
current report on Form 8-K, filed with the SEC on November 2,
2007;
|
|
|
•
|
our
current report on Form 8-K, filed with the SEC on December 5,
2007;
|
|
|
•
|
our
current report on Form 8-K, filed with the SEC on December 17,
2007;
|
|
|
•
|
our
current report on Form 8-K, filed with the SEC on February 29,
2008;
|
|
|
•
|
our
current report on Form 8-K, filed with the SEC on March 17, 2008;
and
|
|
|
•
|
the
description of our common stock contained in our Registration Statement on
Form SB-2/A, filed with the SEC on April 7,
2006.
|
The
information about us contained in this prospectus should be read together with
the information in the documents incorporated by reference. You may request a
copy of any or all of these filings, at no cost, by writing or telephoning us
at:
WPCS
International Incorporated
One East
Uwchlan Avenue, Suite 301
Exton,
Pennsylvania 19341
Phone
(610) 903-0400
Email
address: ir@wpcs.com
PART
II
INFORMATION
NOT REQUIRED IN THE PROSPECTUS
The
following table sets forth an estimate of the costs and expenses payable by WPCS
International Incorporated in connection with the offering described in this
registration statement. All of the amounts shown are estimates except the
Securities and Exchange Commission ("SEC") registration fee:
|
|
|
$
|
36.48
|
|
|
|
|
|
|
|
|
Accounting
Fees and Expenses
|
|
|
3,000.00
|
|
|
|
|
|
|
|
|
Legal
Fees and Expenses
|
|
|
15,000.00
|
|
|
|
|
|
|
|
|
Miscellaneous
|
|
|
164.00
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
18,200.48
|
|
ITEM
15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our
Certificate of Incorporation limits, to the maximum extent permitted by Delaware
law, the personal liability of directors for monetary damages for breach of
their fiduciary duties as a director. Our Bylaws provide that we shall indemnify
our officers and directors and may indemnify our employees and other agents to
the fullest extent permitted by Delaware law.
Section
145 of the Delaware General Corporation Law provides that a corporation may
indemnify a director, officer, employee or agent made a party to an action by
reason of the fact that he or she was a director, officer, employee or agent of
the corporation or was serving at the request of the corporation against
expenses actually and reasonably incurred by him or her in connection with such
action if he or she acted in good faith and in a manner he or she reasonably
believed to be in, or not opposed to, the best interests of the corporation and
with respect to any criminal action, had no reasonable cause to believe his or
her conduct was unlawful.
Insofar
as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers or persons controlling us pursuant to the
foregoing provisions, we have been advised that in the opinion of the
Commission, such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable.
|
Number
|
|
Description
|
|
|
|
|
|
|
|
5.1
|
|
Opinion
of Sichenzia Ross Friedman Ference LLP.
|
|
|
|
|
|
|
|
10.1
|
|
Stock
Purchase Agreement, dated as of August 1, 2007, by and among WPCS
International Incorporated, Major Electric, Inc., Frank Mauger, James
Jordan and Todd Kahl, filed as an exhibit to the Current Report on Form
8-K filed with the Securities and Exchange Commission on August 7, 2007
and incorporated herein by reference.
|
|
|
|
|
|
|
|
10.2
|
|
Registration
Rights Agreement, dated as of August 1, 2007, by and among WPCS
International Incorporated, Major Electric, Inc., Frank Mauger, James
Jordan and Todd Kahl, filed as an exhibit to the Current Report on Form
8-K filed with the Securities and Exchange Commission on August 7, 2007
and incorporated herein by reference.
|
|
|
|
|
|
|
|
10.3
|
|
Escrow
Agreement, dated as of August 1, 2007, by and among WPCS International
Incorporated, Major Electric, Inc., Frank Mauger, James Jordan, Todd Kahl
and Sichenzia Ross Friedman Ference LLP, filed as an exhibit to the
Current Report on Form 8-K filed with the Securities and Exchange
Commission on August 7, 2007 and incorporated herein by
reference.
|
|
|
|
|
|
|
|
10.4
|
|
Stock
Purchase Agreement, dated as of March 30, 2007, by and among WPCS
International Incorporated, Voacolo Electric Incorporated, Jeffrey
Voacolo, David Voacolo, Joseph Voacolo and Tracy Hossler, filed as an
exhibit to the Current Report on Form 8-K filed with the Securities and
Exchange Commission on April 2, 2007 and incorporated herein by
reference.
|
|
|
|
|
|
|
|
10.5
|
|
Registration
Rights Agreement, dated as of March 30, 2007, by and among WPCS
International Incorporated, Jeffrey Voacolo, David Voacolo, Joseph Voacolo
and Tracy Hossler, filed as an exhibit to the Current Report on Form 8-K
filed with the Securities and Exchange Commission on April 2, 2007 and
incorporated herein by reference.
|
|
|
|
|
|
|
|
10.6
|
|
Escrow
Agreement, dated as of March 30, 2007; by and among WPCS International
Incorporated, Voacolo Electric Incorporated, Jeffrey Voacolo, David
Voacolo, Joseph Voacolo; Tracy Hossler and Sichenzia Ross Friedman Ference
LLP, filed as an exhibit to the Current Report on Form 8-K filed with the
Securities and Exchange Commission on April 2, 2007 and incorporated
herein by reference.
|
|
|
|
|
|
|
|
23.1
|
|
Consent
of J.H. Cohn LLP, an Independent Registered Public Accounting
Firm.
|
|
|
|
|
|
|
|
23.2
|
|
Consent
of Sichenzia Ross Friedman Ference LLP (included in Exhibit
5.1).
|
|
|
|
|
|
|
|
24
|
|
Power
of Attorney (included on Page II-6).
|
|
ITEM
17. UNDERTAKINGS
(a) The 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) To
reflect in the prospectus any facts or events arising after the effective date
of this registration statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental change
in the information set forth in this 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 SEC
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate offering price set
forth in the “Calculation of Registration Fee” table in the effective
registration statement;
(iii) To
include any material information with respect to the plan of distribution not
previously disclosed in this registration statement or any material change to
such information in this registration statement; provided,
however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the SEC
by the registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this 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.
(4) That,
for the purpose of determining liability under the Securities Act of 1933 to any
purchaser:
(A) If
the registrant is relying on Rule 430B:
(i)
Each prospectus filed by the registrant pursuant to Rule 424(b)(3)shall be
deemed to be part of the registration statement as of the date the filed
prospectus was deemed part of and included in the registration statement;
and
(ii)
Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or
(b)(7) as part of a registration statement in reliance on Rule 430B
relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or
(x) for the purpose of providing the information required by section 10(a)
of the Securities Act of 1933 shall be deemed to be part of and included in the
registration statement as of the earlier of the date such form of prospectus is
first used after effectiveness or the date of the first contract of sale of
securities in the offering described in the prospectus. As provided in
Rule 430B, for liability purposes of the issuer and any person that is at
that date an underwriter, such date shall be deemed to be a new effective date
of the registration statement relating to the securities in the registration
statement to which that prospectus relates, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Provided, however, that no statement made in a registration statement or
prospectus that is part of the registration statement or made in a document
incorporated or deemed incorporated by reference into the registration statement
or prospectus that is part of the registration statement will, as to a purchaser
with a time of contract of sale prior to such effective date, supersede or
modify any statement that was made in the registration statement or prospectus
that was part of the registration statement or made in any such document
immediately prior to such effective date; or
(B) If
the registrant is subject to Rule 430C, each prospectus filed pursuant to
Rule 424(b) as part of a registration statement relating to an offering, other
than registration statements relying on Rule 430B or other than
prospectuses filed in reliance on Rule 430A, shall be deemed to be part of
and included in the registration statement as of the date it is first used after
effectiveness. Provided, however, that no statement made in a registration
statement or prospectus that is part of the registration statement or made in a
document incorporated or deemed incorporated by reference into the registration
statement or prospectus that is part of the registration statement will, as to a
purchaser with a time of contract of sale prior to such first use, supersede or
modify any statement that was made in the registration statement or prospectus
that was part of the registration statement or made in any such document
immediately prior to such date of first use.
(b) The
registrant hereby undertakes 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 Section 15(d) of the Securities Exchange Act of
1934 that is incorporated by reference in this registration statement shall be
deemed to be a new registration statement relating to the securities offered
herein, 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 Securities Act of 1933 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 Securities Act of 1933 and will be governed by the
final adjudication of such issue.
In
accordance with the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Form
S-3 to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Exton, State of Pennsylvania, on March 18, 2008.
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WPCS
INTERNATIONAL INCORPORATED
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By:
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/s/ Andrew
Hidalgo |
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Andrew
Hidalgo
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Chairman,
Chief Executive Officer and Director
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By: |
/s/ Joseph
Heater
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Joseph
Heater
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Chief
Financial Officer (Principal Financial Officer) and Principal Accounting
Officer
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KNOW
ALL PERSONS BY THESE PRESENTS:
That the
undersigned officers and directors of WPCS International Incorporated, a
Delaware corporation, do hereby constitute and appoint Andrew Hidalgo and Joseph
Heater and each of them his or her true and lawful attorney-in-fact and agent
with full power and authority to do any and all acts and things and to execute
any and all instruments which said attorney and agent, determine may be
necessary or advisable or required to enable said corporation to comply with the
Securities Act of 1933, as amended, and any rules or regulations or requirements
of the Securities and Exchange Commission in connection with this Registration
Statement. Without limiting the generality of the foregoing power and authority,
the powers granted include the power and authority to sign the names of the
undersigned officers and directors in the capacities indicated below to this
Registration Statement, and to any and all instruments or documents filed as
part of or in conjunction with this Registration Statement or amendments or
supplements thereof, including post-effective amendments, to this Registration
Statement or any registration statement relating to this offering to be
effective upon filing pursuant to Rule 462(b) under the Securities Act of
1933, and each of the undersigned hereby ratifies and confirms that said
attorney and agent, shall do or cause to be done by virtue thereof. This Power
of Attorney may be signed in several counterparts.
IN
WITNESS WHEREOF, each of the undersigned has executed this Power of Attorney. In
accordance with the requirements of the Securities Act of 1933, as amended, this
registration statement was signed by the following persons in the capacities and
on the dates stated:
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Signature
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Title
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Date
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/s/ ANDREW
HIDALGO
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Chairman,
Chief Executive Officer (Principal Executive
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| Andrew
Hidalgo |
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Officer) and
Director |
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/s/ JOSEPH
HEATER
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Chief
Financial Officer (Principal Financial Officer and
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March
18, 2008
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Joseph
Heater
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Principal
Accounting Officer) |
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/s/ NORM
DUMBROFF
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March
18, 2008
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Norm
Dumbroff
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| /s/ NEIL HEBENTON |
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Director
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March
18, 2008 |
| Neil
Hebenton |
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| /s/ GARY WALKER |
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Director
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March
18, 2008 |
| Gary
Walker |
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| /s/ WILLIAM
WHITEHEAD |
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Director |
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March
18, 2008 |
| William
Whitehead |
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/s/
WILLIAM WHITEHEAD
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Director |
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March
18, 2008 |
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William
Whitehead
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II-6