IDT Spectrum filing; 10/24/05
sec.gov
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Experienced senior management hired from outside IDT:
IDT Corporation Names John C. Petrillo CEO of Newly Formed IDT Spectrum, Inc.
IDT Spectrum, Inc. To Market Spectrum Assets and Services
Newark, N.J., April 7, 2005 – IDT Corporation (NYSE: IDT, IDT.C) today announced the appointment of John C. Petrillo, former Executive Vice President for Corporate Strategy & Business Development for AT&T, as Chief Executive Officer of IDT Spectrum Inc. IDT Spectrum is the recently formed division of IDT that operates and markets wireless spectrum products and solutions. IDT Corporation is an international telecom, entertainment and technology company.
"The increasing demand for wireless connectivity makes IDT's spectrum assets a valuable commodity," said Jim Courter, IDT's CEO. "John Petrillo's appointment as IDT Spectrum's CEO places those assets under the management of a gifted executive who has played a key role in the development and implementation of many advanced and innovative telecommunications technologies."
John C. Petrillo has played a leading role in the telecommunication industry for more than 30 years. As Executive Vice President at AT&T, Mr. Petrillo supervised the launch of new telecommunication products and services and was lead negotiator on many critical global and domestic telecom business relationships. He also held many significant operating positions and led strategic initiatives including the development of business strategies in the telephone services, cable and Internet industries. His educational credits include a Bachelor of Science degree in Electrical Engineering from Worcester Polytechnic Institute and a legal degree from Brooklyn Law School.
IDT Spectrum, Inc. Names Peter B. Atwal, President, Engineering and Operations
Entrepreneur and Telecommunications Standards Expert Joins Recently Formed IDT Corporation Subsidiary
Newark, NJ, April 28, 2005 - IDT Spectrum, Inc. today announced the appointment of Peter Atwal as President of Engineering and Operations. Mr. Atwal was most recently Vice President - New Ventures Development for Military Commercial Technologies Inc. (Milcom). IDT Spectrum, Inc. is the recently formed subsidiary of IDT Corporation that operates and markets wireless spectrum products and solutions. IDT Corporation (NYSE: IDT, IDT.C) is an international telecom, entertainment and technology company.
IDT Spectrum is the largest holder of commercial high frequency exclusively licensed fixed wireless spectrum in the United States. On average, IDT holds more than 500 MHz of spectrum in the top 200 U.S. markets and approximately 940 MHz in the top 50 markets.
"IDT Spectrum began operations with significant spectrum assets. Now we're in the process of building a brilliant management team," said Jim Courter, IDT's CEO. "The increasing demand for spectrum has made those assets very valuable. As IDT Spectrum's President of Engineering and Operations, Peter Atwal will help develop and market IDT's spectrum."
While at Milcom, Mr. Atwal created and founded nine start-up ventures, including MeshNetworks, TelAsic, Realvue, and Skycross. Mr. Atwal also founded ISR Global Telecom (ISRGT), a venture backed, private company whose focus is network management for the telecommunications industry. Prior to founding ISRGT, Mr. Atwal worked for Siemens, where he was responsible for Operations, Administration and Maintenance, and for software subsystem development for the EWSD class 5-voice switch, one of the most deployed switching systems in the world.
"Peter Atwal is that rare telecommunications executive who combines the best qualities of a manager, entrepreneur, and technologist," said John C. Petrillo, CEO of IDT Spectrum, Inc. "Not only has he founded successful hi-tech companies, but he's also played a key role in the development of advanced communications hardware."
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prospect --
wcai.com
IDT Proprietary:
Licensed Fixed Wireless Backhaul For Public Safety & First Responder Networks
June 30, 2005
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SEC filing positives and negatives:
cellular backhaul:
One of our primary business strategies is to provide cellular wireless mobile telecommunications companies with backhaul services, which is the movement of telecommunications traffic between cell sites and points of connection to wired networks. Demand for backhaul services will depend to a large extent on the widespread acceptance and use of 3G technologies, such as high speed data service, video phone capability, telephone photography, streaming video, downloadable music, and video games.
USE OF PROCEEDS
We estimate that we will receive approximately $46.0 million in net proceeds from this offering, or $53.1 million if the underwriter’s over-allotment option is exercised in full, based upon an assumed initial public offering price of $12.00 per share, after deducting underwriting discounts and commissions and $1.5 million of estimated offering costs payable by us. We expect to use our net proceeds from this offering as follows:
• approximately $10.0 million to continue development of our operations management software platform and equipment to achieve initial capability;
• approximately $6.5 million for operations facility costs related to our network operating center;
• approximately $12.0 million for personnel costs, including salaries;
• approximately $10.0 million for sales and marketing efforts, including customer-related network engineering, planning and development; and
• the remainder for general corporate purposes, including debt service payments and other corporate overhead.
Pending use of the net proceeds for the purposes described above, we plan to invest the net proceeds of this offering in short-term, investment grade, interest-bearing securities. The amounts we actually expend in these areas may vary significantly from our expectations and will depend on a number of factors, including operating costs, capital expenditures and the timing of sales and marketing initiatives or customer trials. Accordingly, management will retain broad discretion in the allocation of the net proceeds of this offering. We anticipate that our existing resources, together with the net proceeds of this offering, will enable us to continue development of our platform and equipment and to engage in sales and marketing activities for at least 12 months from the date of this prospectus.
Spectrum leasing services
We currently lease spectrum and provide related services to telecommunications providers and other companies that prefer to buy their own microwave equipment and design their own fixed wireless networks for last mile and backhaul applications and have the staff and operational systems to support a build-out. We provide leased spectrum to one cellular carrier and four Internet service providers. In the future, we do not expect to focus on spectrum leasing as a significant part of our business strategy.
Sales and Marketing
We intend to market our services to a targeted group of telecommunications carriers, governmental entities, commercial enterprises and systems integrators, focusing on large accounts and complex installations. Although we currently do not have service agreements that require us to build out our network platform, we intend to approach our prospective customers with pre-contract network designs that will detail the required capital equipment necessary to support customer demand for a minimum of five years and the necessary service support resources to maintain associated operations, including, network capacity planning, field installation and maintenance and an allocated portion of our network platform. Accordingly, our sales and marketing resources and efforts will be focused on developing customer specific account management and sales plans, and ongoing relationship management, concentrating on a limited number of large customers. We intend that our customer support efforts will include assessing customer specific needs, developing customer specific network designs and extensive ongoing customer support and service.
As we develop our platform, our technology and field services partners will be a part of our sales and marketing effort, as the coordination of network design, field deployment and ongoing service support requires appropriate teaming arrangements for high quality design, installation and ongoing service support.
As many of our customers will be established telecommunications operators and other industry participants, we expect our management to participate in industry associations and standards-making bodies to support and supplement our sales and marketing activity.
Major customers
Several accounts within the MCI Group accounted for approximately 36%, 27% and 24% of our revenues for the years ended July 31, 2005, 2004 and 2003, respectively. Cingular and Verizon (each consisting of several accounts) accounted for 15% and 10% of our revenues for the year ended July 31, 2005. We have not entered into service contracts with any of these customers. The loss of these or our other major customers would have a material adverse effect on our revenues. These major customers are not related to us.
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