[EAGLE BROADBAND LOGO] 101 Courageous Drive
League City, Texas 77573
Phone: (281) 538-6000
Toll Free: (800) 628-3910
Fax: (281) 538-4730
www.eaglebroadband.com
October 28, 2005
Mr. Larry Spirgel, Assistant Director Via Federal Express
U.S. Securities and Exchange Commission
Division of Corporation Finance
100 F Street, NE
Mail Stop 3561
Washington, D.C. 20549
Re: Eagle Broadband, Inc. (the "Company" or "Eagle")
Form S-1, filed August 26, 2005
Amendment No. 1 to Form S-1, filed September 1, 2005
File No.: 333-127895
Dear Mr. Spirgel:
Please be advised that, concurrent with this response, the Company filed
Amendment No. 2 to its Registration Statement on Form S-1 (the "Amendment").
A courtesy copy of the filing is enclosed herewith, together with a redline
comparison to the Form S-1 filed on August 26, 2005, as amended on September 1,
2005. The following are our responses to your comment letter dated September 23,
2005. Our responses are numbered to correspond with the numbered paragraphs
included in your comment letter.
Form S-1, General
1. The Company has filed (or incorporated by reference) all previously omitted
exhibits (with the exception of Exhibit 23.1), including Exhibit 5.1, the
Opinion of Brewer & Pritchard, P.C.
2. For reasons discussed below, the Company does not believe that it is
premature to register resales of the 14,875,000 shares (the "Shares") at
this time. Further, for the reasons discussed below, the Company does not
agree "that conditions to the private sale of securities to the selling
shareholders are not complete or are still within the control of the
selling shareholders."
Interpretation No. 3S states, in part,
In a PIPE transaction, the staff will not object if a company
registers the resale of securities prior to their issuance if
the company has completed a Section 4(2)-exempt sale of the
securities to the investor, and the investor is at market risk
at the time of filing of the resale registration
statement....There can be no conditions to closing that are
within an investor's control or that an investor can cause not
to be satisfied....The closing of the private placement of the
unissued securities must occur within a short time after the
effectiveness of the resale registration statement.
On October 18, 2005, the shareholders of the Company approved the issuance
of the Shares as required by the American Stock Exchange ("AMEX"). At no
time between August 12, 2005 (the "Closing Date"), and October 18, 2005,
did the purchasers have the right to unilaterally rescind their purchase of
the Shares. The Securities Purchase Agreement ("SPA"), executed by each
purchaser and the Company on or about August 12, 2005, shows that the
purchasers were irrevocably bound and that the PIPE transaction is
consistent with the guidelines set forth in Interpretation No. 3S.
Closing under the SPA occurred on or about August 12, 2005, when all of the
deliveries required under Section 2.2 of the SPA took place. There were no
subsequent closings, nor will there be any future closings. The purchasers
transferred the full amount ($4,050,000) via wire transfer on or about the
Closing Date. After the closing, there were no conditions within the
purchasers' control pursuant to which they may have opted to have their
funds returned to them or to pay a price different than the price
stipulated in the SPA. Thus, the purchasers were at market risk with
respect to all of the shares being registered. Section 3.1(t) of the SPA
states, in part, that "the Company will forward to each Purchaser the
Shares once listing approval has been granted by the American Stock
Exchange." Because the AMEX subsequently determined that shareholder
approval was required for the listing of the Shares, the only condition to
delivery was such approval, which clearly was not within the purchasers'
control.
The AMEX informed the Company in its August 26, 2005 letter that no votes
representing the shares issued in the February, April or August 2005
offerings should be counted with respect the proposal to issue the Shares.
Since the record date for voting at the October 18, 2005 shareholder
meeting was July 26, 2005, none of the shares issued in the August 2005
offering were eligible to vote.
With regard to the shares acquired by the purchasers in the February/April
offering, the purchasers hold their shares in street name. Thus, it would
be difficult and costly for the Company to verify whether or not any of the
purchasers voted any shares purchased in the February/April offering for or
against the proposal. The proposal was approved with more than 66.3 million
shares voting in favor of the proposal and 15.6 million shares voting
against it. The maximum amount of shares the purchasers could have voted on
this proposal was approximately 22.6 million shares (the amount they
purchased in the February/April offering). Based on the actual vote, the
following can be assumed:
(1) If it is assumed that the purchasers did indeed vote all of their
shares in favor of the proposal (such that they are included in the
total votes reflected), and the vote is adjusted to deduct all of
these votes, the proposal still would have passed.
(2) If it is assumed that the purchasers did indeed vote all of their
shares in favor of the proposal, and these votes are deducted from the
"for" votes and added to the "against" votes, the purchasers still
could not have changed the outcome of the vote.
(3) If it is assumed that none of the purchasers voted for or against the
proposal, and these potential votes are added to the "against" votes,
it is clear that the purchasers still could not have changed the
outcome of the vote.
Based on the foregoing, it is clear the purchasers could not have
affected the vote one way or the other, and it is thus unnecessary to
determine whether (and if so, how) the purchasers voted on this
proposal.
3. As explained above, the closing on the sale of the Shares occurred on
August 12, 2005. After that date, the purchasers did not have the
unilateral right to rescind their purchases and they bore the market risks
with respect to the ownership of the Shares. The AMEX listing was not a
condition of closing (indeed, the shareholder approval requirement of
listing was not contemplated at the time of closing), and for the reasons
described above, the purchasers did not influence the outcome of the
shareholder vote. Had the proposal been rejected or the margin of approval
been smaller, the Company would have taken the steps necessary to determine
whether and how the purchasers voted any shares purchased in the
February/April offering and excluded such votes from the final tabulation.
Prospectus Summary, page 3
4. The Prospectus Summary has been revised to clarify that all of the Shares
have been sold, the amount of proceeds received and the dates on which such
proceeds were received. The issue date for the warrant to Keystone has been
left blank, as we are still finalizing the form of the warrant agreement
with Keystone. Other sections of the Registration Statement containing
similar discussions have also been updated.
Risk Factors, page 6
5. This section has been updated to clarify that the transaction has been
completed and that the funds have been received by the Company.
Experts, page 48
6. The statements regarding the incorporation of financial statements by
reference have been removed.
7. The reference to Malone & Bailey has been removed.
Where You Can Find More Information, page 48
8. The Company has made the requested change.
Part II - Information not Required in the Prospectus, page II-1
Item 15. Recent Sales of Unregistered Securities, page II-2
9. The June 2005 disclosure has been revised to include the names of the
directors and former employees who received unregistered shares and the
consideration received therefor. The December 2004 issuance to Jango has
been revised to include the amount of debt that was satisfied. The
disclosure for the October and September 2003 transactions have been
revised to include the amount of consideration in those transactions.
Item 16. Exhibits, page II-4
10. This item has been revised to incorporate all previously omitted exhibits
(with the exception of Exhibit 23.1). Please note that there was not a
separate Securities Purchase Agreement for the April 2005 offering. On or
about April 15, 2005, the purchaser in that offering joined the Securities
Purchase Agreement dated February 2005 incorporated by reference as Exhibit
10.3 to the Amendment.
11. All exhibits have been removed from the body of the Amendment and filed
separately as exhibits.
If you have any questions regarding the foregoing, please call me at (281)
538-6014.
Very truly yours,
/s/ Jeff Adams
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Jeff Adams
Corporate Counsel