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Securities and Exchange Commission
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 10, 2001
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SPEEDUS.COM, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 333-45730 13-385-3788
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
140 58th Street, Suite 7E, Brooklyn, New York 11220
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(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area code: (718) 567-4300
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N/A
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(Former name or former address, if changed since last report)
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SPEEDUS.COM, INC.
Item 5. Other Events. On January 11, 2001, the Board of Directors of the
Company authorized and declared a distribution of one right (a "Right") for each
of its outstanding shares of common stock, par value $.01 per share ("Common
Stock"). The distribution is payable as of January 26, 2001 (the "Record Date")
to holders of record of shares of Common Stock on that date. Each Right entitles
the registered holder thereof to purchase from the Company one ten-thousandth of
a share of Series A Junior Participating Preferred Stock, par value $.01 per
share, of the Company ("Series A Preferred Stock") at a price of $50.00 (the
"Purchase Price"), subject to certain adjustments. The description and terms of
the Rights will be set forth in a Rights Agreement, as the same may be amended
from time to time (the "Rights Agreement"), between the Company and Equiserve
Trust Company, N.A., as rights agent (the "Rights Agent").
Initially the Rights will not be exercisable, certificates will not be sent
to stockholders and the Rights will automatically trade with the shares of
Common Stock.
The Rights, unless earlier redeemed or exchanged by the Board of Directors,
become exercisable upon the close of business on the day (the "Distribution
Date") which is the earlier of (i) the tenth day following a public announcement
that a person or group of affiliated or associated persons (other than certain
exceptions set forth below, an "Acquiring Person") has acquired beneficial
ownership or voting control of 17% or more of the outstanding shares of Common
Stock and (ii) the tenth business day (or such later date as may be determined
by the Board of Directors prior to such time as any person or group of
affiliated or associated persons becomes an Acquiring Person) after the date of
the commencement or public announcement of a person's or group's intention to
commence a tender or exchange offer, the consummation of which would result in
the acquisition of beneficial ownership or voting control of 17% or more of the
Company's outstanding shares of Common Stock (even if no shares of Common Stock
are actually acquired pursuant to such offer); prior thereto, the Rights will
not be exercisable, will not be represented by a separate certificate and will
not be transferable apart from the shares of Common Stock, but will instead be
evidenced, with respect to any of the Common Stock certificates outstanding as
of the Record Date, by such Common Stock certificate itself. An Acquiring Person
does not include (i) the Company, (ii) any subsidiary of the Company, (iii) any
employee benefit plan of the Company or of any subsidiary of the Company, or any
trust or other entity holding shares of Common Stock for or pursuant to the
terms of any such plan, (iv) any person or group of affiliated or associated
persons whose beneficial ownership or voting control of 17% or more of the
outstanding shares of Common Stock results solely from a reduction in the number
of outstanding shares of Common Stock (provided that any such person or group
that does not become an Acquiring Person by reason of the exception provided by
this clause (iv) shall become an Acquiring Person upon acquisition of any
additional outstanding shares of Common Stock unless such acquisition of
additional shares of Common Stock will not result in such person or group
becoming an Acquiring Person), or (v) Shant S. Hovnanian, Vahak S. Hovnanian and
members of their respective families.
Until the Distribution Date (or earlier redemption, exchange or expiration
of the Rights), new certificates for shares of Common Stock issued after the
Record Date will contain a legend incorporating the Rights Agreement by
reference. Until the Distribution Date (or earlier redemption, exchange or
expiration of the Rights), the surrender for transfer of shares of
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Common Stock outstanding as of the Record Date also will constitute the transfer
of the Rights attaching to such shares. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights ("Rights
Certificates") will be mailed to holders of record of shares of Common Stock as
of the close of business on the Distribution Date, and such separate Rights
Certificates alone will evidence the Rights from and after the Distribution
Date.
The Rights will expire at the close of business on January 26, 2011 (the
"Final Expiration Date"), unless earlier redeemed or exchanged by the Company as
described below.
The number of one ten-thousandths of a share of Series A Preferred Stock
issuable upon exercise of the Rights is subject to certain adjustments from time
to time in the event of a share distribution on, or a subdivision or combination
of, the shares of Common Stock. The Purchase Price for the Rights is subject to
adjustment in certain events.
Unless the Rights are earlier redeemed or exchanged, in the event that a
person or group of affiliated or associated persons becomes an Acquiring Person,
the Rights Agreement provides that each holder of record of a Right, other than
the Acquiring Person (whose Rights will thereupon become null and void), will
thereafter have the right to receive, upon payment of the Purchase Price, that
number of shares of Common Stock having a market value at the time of the
transaction equal to two times the Exercise Price.
In addition, unless the Rights are earlier redeemed or exchanged, in the
event that after the time that a person or group of affiliated or associated
persons becomes an Acquiring Person the Company were to be acquired in a merger
or other business combination (in which any shares are changed into or exchanged
for other securities or assets) or more than 50% of the assets or earning power
of the Company and its subsidiaries (taken as a whole) were to be sold or
transferred in one or a series of related transactions, the Rights Agreement
provides that proper provision will be made so that each holder of record of a
Right, other than the Acquiring Person (whose rights will thereupon become null
and void), will from and after such date have the right to receive, upon payment
of the Purchase Price, that number of shares of common stock of the acquiring
company having a market value at the time of such transaction equal to two times
the Purchase Price.
At any time after any person or group of affiliated or associated persons
becomes an Acquiring Person, the Board of Directors may issue shares of Common
Stock in exchange for the Rights (other than Rights owned by the Acquiring
Person, which will have become null and void), in whole or part, at an exchange
ratio of one share of Common Stock per Right (subject to adjustment).
The Rights Agreement provides that the Company may pay cash in lieu of
issuing fractional shares upon exercise or redemption of the Rights.
At any time on or prior to the earlier of (i) the close of business on the
tenth day after a public announcement that a person or group of affiliated or
associated persons has become an Acquiring Person (or such earlier or later date
as may be authorized by the Board of Directors), or (ii) the Final Expiration
Date, the Company may redeem the Rights in whole, but not in part, at a price of
$.01 per Right ("Redemption Price"), payable at the election of the Company in
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cash, shares of Common Stock or other consideration determined to be appropriate
by the Board of Directors. Following the effective time of the action of the
Board of Directors authorizing redemption of the Rights, the right to exercise
the Rights will terminate and the only right of the holders of the Rights will
be to receive the Redemption Price.
However, upon the termination of the Company's redemption right with
respect to the Rights, such redemption right may be reinstated (with the
concurrence of a majority of the Directors) if an Acquiring Person reduces his
beneficial ownership to 15% or less of the outstanding shares of Common Stock in
a transaction or series of transactions not involving the Company and there are
no other Acquiring Persons.
For as long as the Rights are then redeemable, the Company may, except with
respect to the Redemption Price or date of expiration of the Rights, amend the
Rights in any manner, including an amendment to extend the time period in which
the Rights may be redeemed. At any time when the Rights are not then redeemable,
the Company may amend the Rights in any manner that does not materially
adversely affect the interests of holders of the Rights as such.
Until a Right is exercised, the holder, as such, will have no rights as a
stockholder of the Company, including, without limitation, the right to vote or
to receive distributions.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group of affiliated or associated persons
that attempts to acquire the Company on terms not approved by the Board of
Directors. The Rights should not interfere with any merger or other business
combination approved by the Board of Directors since the Rights may be redeemed
by the Company at $.01 per Right at any time until the close of business on the
tenth day (or such earlier or later date as described above) after a person or
group has obtained beneficial ownership or voting control of 17% or more of the
voting shares.
The form of Rights Agreement between the Company and Equiserve Trust
Company, N.A., as Rights Agent, specifying the terms of the Rights, which
includes as Exhibit A the Certificate of Designation, Preferences and Rights of
Series A Junior Participating Preferred Stock of SPEEDUS.COM, Inc., as Exhibit B
the form of Rights Certificate and as Exhibit C the form of Summary of Rights to
Purchase Shares of Series A Junior Participating Preferred Stock, is attached
hereto as an exhibit and incorporated herein by reference. The foregoing
description of the Rights is qualified in its entirety by reference to such
exhibit.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
Exhibits
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The following exhibit is filed as part of this report:
99.1. The form of Rights Agreement between the Company and Equiserve
Trust Company, N.A., as Rights Agent, specifying the terms of the
Rights, which includes as Exhibit A the Certificate of
Designation, Preferences and Rights of Series A Junior
Participating Preferred Stock of SPEEDUS.COM, Inc., as Exhibit B
the form of Rights Certificate and as Exhibit C the Summary of
Rights to Purchase Shares of Series A Junior Participating
Preferred Stock.
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SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant has duly caused this Current Report on Form 8-K to be
signed on its behalf by the undersigned hereunto duly authorized.
By: /s/ Shant S. Hovnanian
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Name: Shant S. Hovnanian
Title: Chief Executive Officer,
President and Chairman of
the Board
January 16, 2001
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EXHIBIT INDEX
Exhibit No. Description
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99.1 Form of Rights Agreement between SPEEDUS.COM, Inc. and Equiserve
Trust Company, N.A., as Rights Agent. The Rights Agreement
includes as Exhibit A the Certificate of Designation, Preferences
and Rights of Series A Junior Participating Preferred Stock of
SPEEDUS.COM, Inc., as Exhibit B the form of Rights Certificate
and as Exhibit C the form of Summary of Rights to Purchase Shares
of Series A Junior Participating Preferred Stock.
