Vector Cambium Holdings (Cayman), L.P.

Vector Capital IV, L.P.

Vector Capital Partners IV, L.P.

Vector Entrepreneur Fund III, L.P.

Vector Capital Partners III, L.P.

Vector Capital, Ltd.

Vector Capital, L.L.C.

c/o Vector Capital Management, L.P.

One Market Street, Steuart Tower, 23rd Floor

San Francisco, CA 94105

 

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1	NAMES OF REPORTING PERSONS
	Vector Cambium Holdings (Cayman), L.P.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP			(a)	☐
				(b)	☑
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	WC, OO
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)				☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Cayman Islands
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			17,704,754
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			17,704,754
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	17,704,754
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)				☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	69.1%
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	PN

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1	NAMES OF REPORTING PERSONS
	Vector Capital IV, L.P.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP			(a)	☐
				(b)	☑
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)				☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			1,482,000
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			1,482,000
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	1,482,000
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)				☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	5.8%
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	PN

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CUSIP No.  G17766109

SCHEDULE 13D

Page 4 of 17 Pages

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CUSIP No.  G17766109

SCHEDULE 13D

Page 5 of 17 Pages

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CUSIP No.  G17766109

SCHEDULE 13D

Page 6 of 17 Pages

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CUSIP No.  G17766109

SCHEDULE 13D

Page 7 of 17 Pages

CUSIP No.  G17766109

SCHEDULE 13D

Page 8 of 17 Pages

CUSIP No.  G17766109

SCHEDULE 13D

Page 9 of 17 Pages

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CUSIP No.  G17766109

SCHEDULE 13D

Page 10 of 17 Pages

Item 1.

SECURITY AND ISSUER

Item 2.

IDENTITY AND BACKGROUND

 

(a) This statement on Schedule 13D is being filed jointly on behalf of the following persons (collectively, the “Reporting Persons”): (i) Vector Cambium Holdings (Cayman), L.P., a Cayman Islands limited partnership (“VCH”), (ii) Vector Capital IV, L.P., a Delaware limited partnership (“VC IV”), (iii) Vector Capital Partners IV, L.P., a Cayman Islands limited partnership (“VCP IV”), (iv) Vector Entrepreneur Fund III, L.P., a Delaware limited partnership (“VEF III”), (v) Vector Capital Partners III, L.P., a Cayman Islands limited partnership (“VCP III”), (vi) Vector Capital, Ltd., a Cayman Islands exempted limited company (“VC Ltd”), (vii) Vector Capital, L.L.C., a Delaware limited liability company (“VC LLC” and together with VCH, VC IV, VCP IV, VEF III, VCP III and VC Ltd, “Vector”), and (viii) Alexander R. Slusky, an individual (“Mr. Slusky”).   VCP IV is the general partner of each of VCH and VC IV. VCP III is the general partner of VEF III.  VC Ltd and VC LLC are the general partners of VCP IV and VCP III.   The agreement among the Reporting Persons relating to the joint filing of this statement is attached to this statement on Schedule 13D as Exhibit A.

 

(b) The business address for the Reporting Persons is One Market Street, Steuart Tower, 23rd Floor, San Francisco, CA 94105.

 

(c) The business of Vector is that of a private limited partnership, engaged in making investments in securities of public and private companies for its own account.  The principal employment of Mr. Slusky is as the Managing Director and Chief Investment Officer of Vector Capital Management, L.P., a Delaware limited partnership, which is principally engaged in the business of managing a portfolio of funds, including Vector.

 

(d) None of the Reporting Persons have, during the last five years, been convicted in a criminal proceeding.

 

(e) None of the Reporting Persons have, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

 

(f) Each of VC IV, VEF III and VC LLC is organized under the laws of the State of Delaware. Each of VCH, VCP IV, VCP III and VC Ltd are organized under the laws of the Cayman Islands. Mr. Slusky is a United States citizen.

Item 3.

SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION

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CUSIP No.  G17766109

SCHEDULE 13D

Page 11 of 17 Pages

 

The response to Item 6 of this Schedule 13D is incorporated by reference in its entirety into this Item 4.

 

Prior to the Company’s initial public offering of its Shares, which closed on June 28, 2019 (the “IPO”), VCH held 100% of the Company’s equity.  Towards that end, in 2011, VCH initially invested $62.5 million in convertible preferred equity certificates (“CPECs”) issued by one of the Company’s wholly-owned subsidiaries, using working capital.  On July 31, 2017, in connection with the dissolution of the subsidiary, the CPECs were redeemed for $88.4 million, which VCH simultaneously contributed to the Company.  On December 21, 2017, the Company made a cash return of contributed capital to VCH in the amount of $65.5 million.

 

In connection with the IPO, the Company effected a recapitalization and return of capital to VCH pursuant to which the Company increased its authorized and outstanding Shares held by VCH.  Specifically, upon consummation of the IPO, VCH received 17,627,575 Shares  representing the amount of unreturned capital and accumulated yield payable to holders of Class A Units of VCH, plus the residual share of the Company’s value attributable to VCH's ownership after such return, based on the IPO price of $12.  In addition, the Company plans to use $5.6 million of the net proceeds from its IPO to pay management fees to VCH and its affiliates.

 

In addition, the Reporting Persons purchased an aggregate of 1,500,000 Shares in the IPO.  Specifically, VC IV acquired 1,482,000 Shares in the IPO, and VEF III acquired 18,000 Shares in the IPO, each at the IPO price of $12 per Share.  Each of VC IV and VEF III used working capital to purchase Shares.

 

The Reporting Persons acquired the securities reported herein for investment purposes.  In their capacity as significant stockholders of the Company, the Reporting Persons intend to take an active role in working with the Company’s management and board of directors on operational, financial and strategic initiatives.  In addition, pursuant the Shareholder Agreement described in Item 6, the Reporting Persons have rights to name persons to the Company’s board of directors and one of the Reporting Persons, Mr. Slusky, serves on the Company’s board of directors.

 

Except as described in this Schedule 13D, the Reporting Persons do not have any present plans or proposals that relate to or would result in any of the actions set forth in subparagraphs (a)-(j) of Item 4 of Schedule 13D.  The Reporting Persons intend to review their investment in the Company on a continuing basis and have in the past and may in the future engage in discussions with management, the board of directors, other stockholders and other relevant parties concerning the business, operations, board composition, management, strategy and future plans of the Company.  Depending on various factors including, without limitation, the results of any such discussions, the Company’s financial position and business strategy, price levels of the Shares, conditions in the securities market and general economic and industry conditions, and subject to the agreements described in this Schedule 13D, the Reporting Persons may in the future take such actions with respect to their investment in the Company as they deem appropriate including, without limitation: purchasing additional shares or selling some or all of their Shares; engaging in any hedging or similar transactions with respect to the Shares; nominating representatives to the board of directors; taking positions or making proposals with respect to, or taking other actions to effect changes in the board composition, ownership structure, management, the charter documents, strategy, future plans and operations of the Company; encouraging the Company to pursue one or more strategic transactions, including transactions in which the Reporting Persons may participate; and/or otherwise changing their intention with respect to any and all matters referred to in Item 4 of Schedule 13D.

 

The aggregate number of Shares and percentages of Shares beneficially owned by each Reporting Person named in Item 2(a), as well as the number of Shares as to which such Reporting Person is deemed to have sole power to vote or to direct the vote, shared power to vote or to direct the vote, sole power to dispose or to direct the disposition and shared power to dispose or direct the disposition, is set forth in the following table:

		Number of Shares
					Power to Vote						Power to Dispose
Reporting Person		No. of Shares Beneficially Owned			Sole			Shared			Sole			Shared			Percent of Class
Vector Cambium Holdings (Cayman), L.P.		17,704,754			0			17,704,754			0			17,704,754			69.1%
Vector Capital IV, L.P.		1,482,000			0			1,482,000			0			1,482,000			5.8%
Vector Capital Partners IV, L.P.		19,186,754			0			19,186,754			0			19,186,754			74.9%
Vector Entrepreneur Fund III L.P.		18,000			0			18,000			0			18,000			0.07%
Vector Capital Partners III, L.P.		18,000			0			18,000			0			18,000			0.07%
Vector Capital, Ltd.		19,204,754			0			19,204,754			0			19,204,754			75.0%
Vector Capital, LLC		19,204,754			0			19,204,754			0			19,204,754			75.0%
Alexander R. Slusky		19,204,754 (1)			0			19,204,754 (1)			0			19,204,754 (1)			75.0%

(1)  This amount excludes Shares underlying options awarded to the Reporting Person that cannot be exercised within 60 days.

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Item 6

CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER

•

Demand registration rights: At any time or from time to time after six months following the date of closing of an initial public offering, including this IPO, and subject to certain conditions, the Reporting Persons may request in writing that the Company effect a registration on Nasdaq. The Company shall be obligated to effect no more than two registrations pursuant to the demand registration rights that have been declared and ordered effective.

•

Form S-3 registration rights: The Reporting Persons have the right to request that the Company file a registration statement on Form S-3 when the Company is qualified for registration on such form. The Company shall be obligated to effect no more than two registrations that have been declared and ordered effective within any 12-month period.

•

Piggyback registration rights:  If the Company proposes to file a registration statement for a public offering of our securities, subject to certain exceptions, the Company shall notify all holders of registrable securities and afford them an opportunity to include in the registration all or any part of their registrable securities that each such holder has requested to be registered.

•

Expenses of registration: Subject to certain exceptions, the Company will pay all expenses (other than underwriting discounts and commissions) in connection with the demand registration, Form S-3 registration and piggyback registration including, among others, all registration and filing fees, printers’ and accounting fees, fees and disbursements of counsel for the Company, reasonable fees and disbursements of a single special counsel for the holders.

•

Termination of registration rights: The registration rights discussed above shall terminate on the earlier of (i) the date that is 7 years from the date of closing of a qualified initial public offering and (ii) with respect to any securityholder, the date on which such holder may sell all of its registrable securities under Rule 144 of the Securities Act of 1933 in any 90-day period.

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•

Limitations on subsequent registration right: From and after the date of the Shareholder Agreement, the Company shall not, without the prior written consent of holders of at least two-thirds of outstanding shares on issue, enter into any agreement with any holder or prospective holder of any equity securities of the Company that would allow such holder or prospective holder (i) to include such equity securities in any registration, unless under the terms of such agreement such holder or prospective holder may include such equity securities in any such registration only to the extent that the inclusion of such equity securities will not reduce the amount of the registrable securities of the holders that are included, (ii) to demand registration of their securities, or (iii) cause the Company to include such equity securities in any registration discussed above on a basis more favorable to such holder or prospective holder than is provided to the holders thereunder.

•

offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of, directly or indirectly, any shares of the Company or any securities convertible into or exercisable or exchangeable for shares, or publicly disclose the intention to make any offer, sale pledge or disposition;

•

enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Shares or such other securities, whether such transaction described in the bullet above or in this bullet is to be settled by delivery of Shares or such other securities, in cash or otherwise; or

•

make any demand for or exercise any right with respect to the registration of any Shares or any of our security convertible into or exercisable or exchangeable for Shares.

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Third Amendment to Amended and Restated Credit Agreement

 

On June 28, 2019, each of VCH, the Company, Cambium Networks, Ltd. and the other loan parties party thereto entered into a Third Amendment to Amended and Restated Credit Agreement (the “Third Amendment”) with Silicon Valley Bank (“SVB”) as the Issuing Lender, the lenders party thereto and SVB as administrative agent for the Lenders. Among other things, the Third Amendment released VCH as a guarantor and loan party, and terminated the guaranty granted by VC IV.  The foregoing summary of the Third Amendment does not purport to be complete and is qualified it its entirety by reference to such agreement, which is filed as Exhibit D to this Schedule 13D and is incorporated by reference herein.

 

Director Stock Option Grants

 

Upon closing of the IPO on June 28, 2019, each of the Reporting Persons’ nominated directors, Mr. Slusky and Mr. Amen, received, for no consideration, an option to acquire 30,000 Shares at a strike price of $12 per Share.  Each option vests 25% on June 23, 2020, 75% in equal quarterly installments thereafter, and expires on June 23, 2029.  Each option was granted pursuant to the Director Stock Option Grant, the form of which is filed as Exhibit E to this Schedule 13D and is incorporated by reference herein.

 

Indemnification Agreements

 

Prior to the completion of the IPO, the Company entered into new indemnification agreements with all of the Company’s executive officers and directors (each, an “Indemnitee”), including Mr. Slusky and Mr. Amen.  Each indemnification agreement provides that the Company will indemnify the Indemnitee to the fullest extent permitted by law for claims arising in his or her capacity as a director or executive officer of the Company, as the case may be, provided that he or she have acted in good faith and in a manner that he or she reasonably believed to be in, or not opposed to, the Company’s best interests and, with respect to any criminal proceeding, had no reasonable cause to believe that their conduct was unlawful.  In the event that the Company does not assume the defense of a claim against an Indemnitee, the Company will be required to advance his or her expenses in connection with his or her defense, provided that he or she undertakes to repay all amounts advanced if it is ultimately determined that he or she is not entitled to be indemnified by the Company.   The foregoing summary of the Indemnification Agreement does not purport to be complete and is qualified it its entirety by reference to the form of such agreement, which is filed as Exhibit F to this Schedule 13D and is incorporated by reference herein.

 

Based on the transactions and relationships described herein, the Reporting Persons may be deemed to constitute a “group” for purposes of Section 13(d)(3) of the Exchange Act. The filing of this statement shall not be construed as an admission that the Reporting Persons are a group, or have agreed to act as a group.

 

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Exhibit C

Form of Lock-Up Agreement

Exhibit D

Third Amendment to Amended and Restated Credit Agreement (incorporated by reference to Exhibit 10.30 to the Company’s Form 8-K filed on July 1, 2019)

Exhibit E

Form of Director Stock Option Grant (incorporated by reference to Exhibit 10.29 to the Company’s Registration Statement on Form S-1/A filed on June 24, 2019)

Exhibit F

Form of Indemnification Agreement entered into between Registrant and its directors and executive officers (incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-1 filed on May 29, 2019)

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	VECTOR CAPITAL IV, L.P.
	By:	VECTOR CAPITAL PARTNERS IV, L.P., its general partner
	By:	VECTOR CAPITAL, LTD., its general partner
	By:	/s/ David Baylor
		Name: David Baylor
		Title:   Director

	VECTOR CAPITAL, LTD.
	By:	/s/ David Baylor
		Name: David Baylor
		Title:   Director

	ALEXANDER R. SLUSKY
	/s/ Alexander R. Slusky

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JOINT FILING AGREEMENT

Date: July 8, 2019

	VECTOR CAMBIUM HOLDINGS (CAYMAN), L.P.
	By:	VECTOR CAPITAL PARTNERS IV, L.P., its general partner
	By:	VECTOR CAPITAL, LTD., its general partner
	By:	/s/ David Baylor
		Name: David Baylor
		Title:   Director

	VECTOR CAPITAL, L.L.C.
	By:	/s/ David Baylor
		Name: David Baylor
		Title:   Chief Operating Officer