<PAGE>
As filed with the Securities and Exchange Commission on June 28, 2000
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
EXODUS COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
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<TABLE>
<S> <C> <C>
Delaware 4813 77-0403076
(State or other jurisdiction of (Primary standard industrial (I.R.S. employer
incorporation or organization) classification number) identification number)
</TABLE>
2831 Mission College Boulevard
Santa Clara, California 95054
(408) 346-2200
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
---------------
Adam W. Wegner
General Counsel
Exodus Communications, Inc.
2831 Mission College Boulevard
Santa Clara, California 95054
(408) 346-2200
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
---------------
Copies to:
Horace L. Nash, Esq.
Piyasena C. Perera, Esq.
Andrew J. Schultheis, Esq.
Fenwick & West LLP
Two Palo Alto Square
Palo Alto, California 94306
(650) 494-0600
---------------
Approximate date of commencement of proposed sale to the public: From time
to time after this Registration Statement becomes effective as determined by
market conditions and other factors.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
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. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Proposed Maximum
Aggregate Proposed Maximum
Title of Each Class of Amount Offering Price Aggregate Amount of
Securities To Be Registered per Offering Registration
To Be Registered (1)(2) Security(2)(3) Price(1)(2)(3) Fee(3)
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<S> <C> <C> <C> <C>
Debt Securities(4).....
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Preferred Stock, par
value $0.001 per
share(5)..............
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Common Stock, par value
$0.001 per share(6)...
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Warrants(7)............
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Total.................. $2,000,000,000 $2,000,000,000 $2,000,000,000 $528,000
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</TABLE>
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(footnotes on following page)
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which shall specifically state 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 Securities
and Exchange Commission, acting pursuant to said Section 8(a), may determine.
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--------------------------------------------------------------------------------
<PAGE>
(footnotes from cover)
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(1) The initial public offering price of any securities denominated in any
foreign currencies or currency units shall be the U.S. dollar equivalent
thereof based on the prevailing exchange rates at the respective times
such securities are first offered. For securities issued with an original
issue discount, the amount to be registered is the amount as shall result
in aggregate gross proceeds of $2,000,000,000.
(2) Pursuant to General Instruction II.D to Form S-3, the Amount To Be
Registered, Proposed Maximum Aggregate Offering Price Per Security and
Proposed Maximum Aggregate Offering Price has been omitted for each class
of securities which are registered hereby.
(3) The registration fee has been calculated in accordance with Rule 457(o)
under the Securities Act of 1933, as amended, and reflects the maximum
offering price of securities that may be issued rather than the principal
amount of any securities that may be issued at a discount.
(4) An indeterminate number of debt securities are covered by this
Registration Statement. Debt securities may be issued (a) separately or
(b) upon exercise of warrants to purchase debt securities which are
registered hereby.
(5) An indeterminate number of shares of preferred stock, par value $0.001 per
share, are covered by this Registration Statement. Shares of preferred
stock may be issued (a) separately, (b) upon the conversion of debt
securities which are registered hereby or (c) upon exercise of warrants to
purchase shares of preferred stock which are registered hereby.
(6) An indeterminate number of shares of common stock, par value $0.001 per
share, are covered by this Registration Statement. common stock may be
issued (a) separately, (b) upon the conversion of either the debt
securities or the shares of preferred stock, each of which are registered
hereby or (c) upon exercise of warrants to purchase shares of common
stock. Shares of common stock issued upon conversion of the debt
securities and the preferred stock will be issued without the payment of
additional consideration.
(7) An indeterminate number of warrants, each representing the right to
purchase an indeterminate number of debt securities, shares of preferred
stock or shares of common stock, each of which are registered hereby, are
covered by this Registration Statement.
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to completion, dated June 28, 2000
PROSPECTUS
[LOGO OF EXODUS $2,000,000,000
COMMUNICATIONS, INC.] Exodus Communications, Inc.
Debt Securities
Preferred Stock
Common Stock
Warrants
-----------
This prospectus includes a general description of the debt securities, shares
of preferred stock, shares of common stock and warrants we may issue from time
to time. We will provide specific terms of these securities in supplements to
this prospectus. You should read this prospectus and each supplement carefully
before you invest.
Our common stock trades on the Nasdaq National Market under the symbol
"EXDS".
-----------
Investing in our securities involves risks, which we describe in the "Risk
Factors" section beginning on page 4 of this prospectus.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
-----------
The date of this prospectus is , 2000.
You should rely only on the information contained or incorporated by
reference in this prospectus and any prospectus supplement. We have not
authorized anyone to provide you with different information. We are not making
an offer to sell these securities in any state where the offer is not
permitted. You should not assume that the information contained in this
prospectus or any prospectus supplement is accurate as of any date other than
the date on the front cover of those documents.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
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<S> <C>
About This Prospectus...................................................... ii
Where You Can Find More Information........................................ ii
Incorporation by Reference................................................. ii
Summary.................................................................... 1
Risk Factors............................................................... 4
Disclosure Regarding Forward-Looking Statements............................ 13
Use of Proceeds............................................................ 14
Dividend Policy............................................................ 14
Ratio of Earnings to Fixed Charges and Preferred Dividends................. 14
Description of Debt Securities............................................. 15
Description of Preferred Stock............................................. 23
Description of Common Stock................................................ 25
Description of Warrants.................................................... 27
Plan of Distribution....................................................... 29
Legal Matters.............................................................. 30
Experts.................................................................... 30
</TABLE>
Unless the context otherwise requires, the terms "we," "our," "us," "the
company" and "Exodus" refer to Exodus Communications, Inc., a Delaware
corporation.
All share numbers in this prospectus reflect the two-for-one stock split in
the form of a stock dividend payable to holders of our common stock on June 20,
2000. The information incorporated by reference into this prospectus, however,
may not reflect this stock split.
----------------
<PAGE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC using a shelf registration process. Under the shelf registration process,
we may offer from time to time debt securities, shares of preferred stock,
shares of common stock and warrants up to an aggregate amount of
$2,000,000,000. This prospectus provides you with a general description of the
securities we may offer. Each time we offer securities, in addition to this
prospectus we will provide you with a prospectus supplement that will contain
specific information about the securities being offered. The prospectus
supplement may also add, update or change information contained in this
prospectus. You should read both this prospectus and any prospectus supplement
as well as additional information described under "Where You Can Find More
Information" immediately below.
WHERE YOU CAN FIND MORE INFORMATION
Because we are subject to the informational requirements of the Exchange
Act, we file reports, proxy statements and other information with the SEC. You
may read and copy these reports, proxy statements and other information at the
public reference facilities maintained by the SEC at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549 and at the SEC's regional offices located
at 7 World Trade Center, 13th floor, New York, New York 10048 and 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. You may also obtain copies
of those materials at prescribed rates from the public reference section of the
SEC at 450 Fifth Street, Washington, D.C. 20549. The public may obtain
information on the operation of the public reference room by calling the SEC at
(800) SEC-0330. In addition, we are required to file electronic versions of
those materials with the SEC through the SEC's EDGAR system. The SEC maintains
a web site at http://www.sec.gov that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the SEC.
We have filed with the SEC a registration statement on Form S-3 under the
Securities Act with respect to the securities offered under this prospectus.
This prospectus does not contain all of the information in the registration
statement, parts of which we have omitted, as allowed under the rules and
regulations of the SEC. You should refer to the registration statement for
further information with respect to us and our securities. Statements contained
in this prospectus as to the contents of any contract or other document are not
necessarily complete and, in each instance, we refer you to the copy of each
contract or document filed as an exhibit to the registration statement. Copies
of the registration statement, including exhibits, may be inspected without
charge at the SEC's principal office in Washington, D.C., and you may obtain
copies from this office upon payment of the fees prescribed by the SEC.
We will furnish without charge to each person to whom a copy of this
prospectus is delivered, upon written or oral request, a copy of the
information that has been incorporated by reference into this prospectus
(except exhibits, unless they are specifically incorporated by reference into
this prospectus). You should direct any requests for copies to:
Exodus Communications, Inc.
2831 Mission College Boulevard
Santa Clara, California 95054
Attention: Adam W. Wegner
Telephone: (408) 346-2200
INCORPORATION BY REFERENCE
The SEC allows us to incorporate by reference the information we file with
them, which means that we can disclose important information to you by
referring you to those documents. We incorporate by reference in this
prospectus the information contained in the following documents:
. our annual report on Form 10-K for the year ended December 31, 1999
filed with the SEC on March 30, 2000;
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. our quarterly report on Form 10-Q for the quarter ended March 31, 2000
filed with the SEC on May 12, 2000;
. our current reports on Form 8-K filed with the SEC on April 7, 2000 and
June 21, 2000;
. the description of our common stock contained in our registration
statement on Form 8-A filed with the SEC on February 13, 1998 under
Section 12(g) of the Exchange Act, including any amendment or report
filed for the purpose of updating such description;
. the description of our preferred stock purchase rights contained in our
registration statement on Form 8-A filed with the SEC on January 29,
1999 under Section 12(g) of the Exchange Act, as amended by a Form 8-A/A
filed with the SEC on November 29, 1999, including any amendment or
report filed for the purpose of updating such description; and
. all documents that we file with the SEC under Sections 13(a), 13(c), 14
or 15(d) of the Securities Exchange Act of 1934 until all the securities
that we may offer under this prospectus are sold.
You may obtain copies of those documents from us, free of cost, by
contacting us at the address or telephone number provided in "Where You Can
Find More Information" immediately above.
Information that we file later with the SEC and that is incorporated by
reference in this prospectus will automatically update and supersede
information contained in this prospectus. You will be deemed to have notice of
all information incorporated by reference in this prospectus as if that
information was included in this prospectus.
iii
<PAGE>
SUMMARY
This section contains a general summary of the information contained in this
prospectus. It may not include all the information that is important to you.
You should read the entire prospectus, any accompanying prospectus supplement
and the documents incorporated by reference before making an investment
decision.
Exodus Communications, Inc.
Exodus Communications is a leading provider of complex Internet hosting for
enterprises with mission-critical Internet operations. We offer sophisticated
system and network management solutions, along with professional services, to
provide optimal performance for customers' Web sites. Exodus delivers its
services from geographically distributed, state-of-the-art Internet Data
Centers that are connected through a high performance dedicated and redundant
backbone network. Our tailored solutions are designed to integrate with
existing enterprise systems architectures and to enable customers to outsource
the monitoring, administration and optimization of their equipment,
applications and overall Internet operations. As of March 31, 2000, we had over
2,800 customers under contract and managed over 39,000 customer servers
worldwide. Our customers represent a variety of industries, ranging from
leading Internet companies to major enterprise customers, including Yahoo!, USA
Today.com, weather.com, priceline.com, British Airways and Nordstrom.
Internet usage is growing rapidly and businesses are increasing the breadth
and depth of their Internet product and services offerings. These Internet
operations are mission-critical for Internet-centric businesses and are
becoming increasingly mission-critical for many enterprises. In order to ensure
the quality, reliability, availability and redundancy of these mission-critical
Internet operations, corporate IT departments must make substantial investments
in facilities, personnel, equipment and networks which must be continuously
upgraded to reflect changing technologies and must rapidly scale as the
enterprise grows. This recurring and significant investment is an inefficient
use of resources and, as a result, a significant need exists for outsourcing
arrangements that can increase performance, provide continuous operation of
Internet solutions and reduce Internet operating expenses. We believe a
significant opportunity exists for a highly focused company to provide a
combination of server hosting, Internet connectivity and managed and
professional services that will enable reliable, high performance mission-
critical Internet operations.
Exodus offers an integrated portfolio of solutions that provides customers
with a scalable, secure and high performance platform for the development,
deployment and proactive management of mission-critical Internet operations.
Our server hosting and Internet connectivity services are offered through our
Internet Data Centers and our redundant backbone network of multiple high speed
OC-3 and OC-12 lines, along with our public and private network
interconnections. We continue to upgrade our network in order to accommodate
expected traffic growth. Our managed services include performance monitoring,
site management reports, data backup, content delivery and management services,
security services and professional services. These services provide the
foundation for high performance, availability, scalability and reliability of
customers' mission-critical Internet operations. In addition, we integrate
best-of-breed technologies from leading vendors with our industry expertise and
proprietary technology.
Our objective is to become the leading provider of Internet system and
network management solutions for enterprises with mission-critical Internet
operations. To achieve this objective, we intend to:
. Continue to position Exodus as the leader in this market;
. Focus on enhancing systems and network management, Internet technology
services and professional services;
. Accelerate our global expansion;
. Leverage our expertise to address new market opportunities; and
. Continue to establish strategic relationships for distribution and
technology.
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We began offering server hosting and Internet connectivity services in late
1995, opened our first dedicated Internet Data Center in August 1996, and
introduced managed services in 1997 and professional services in 1998. We
currently operate 22 Internet Data Centers located in Atlanta, Austin, Boston,
Chicago, Los Angeles, New York, Seattle, Silicon Valley, Washington, D.C.,
London, Tokyo, Frankfurt and Toronto.
We expanded our solutions and services by acquiring providers of Internet
technologies--Arca Systems, Inc. ("Arca"), American Information Systems, Inc.
("AIS"), Cohesive Technology Solutions, Inc. ("Cohesive"), Service Metrics,
Inc. ("Service Metrics"), Exodus Communications KK (formerly Global Online
Japan Co. Ltd.) (sinjuku-ku) ("GOL") and KeyLabs, Inc. ("KeyLabs"). In October
1998, we purchased Arca, a provider of advanced network and system security
consulting services. In February 1999, to accelerate our launch into the
Chicago metropolitan area, we acquired AIS, a regional provider of co-location,
Web hosting and professional services. In July 1999, we acquired Cohesive, a
technology professional services organization with expertise in networking, Web
applications and technology solutions. In November 1999, we acquired Service
Metrics, an Internet monitoring applications and services company. In December
1999, we acquired GOL, an Internet solutions provider, through which we offer
complex Web hosting and a range of Managed and Professional Services in the
Japanese market. In February 2000, we acquired KeyLabs, Inc., a provider of e-
business testing services, and in April 2000, we completed an equity investment
in Mirror Image Internet, Inc., a provider of content distribution services.
Our principal executive offices are located at 2831 Mission College Blvd.,
Santa Clara, California 95054. Our telephone number is (408) 346-2200.
The Securities We May Offer
Each time we offer securities under this prospectus, we will provide you
with a prospectus supplement that will contain the specific terms of the
securities being offered. The following is a summary of the securities we may
offer under this prospectus.
Debt Securities
We may offer unsecured general obligations, which may be either senior or
subordinated and may be convertible into shares of our common stock or
preferred stock. In this prospectus, we refer to the senior debt securities and
the subordinated debt securities together as the "debt securities". The senior
debt securities will have the same rank as all our other unsecured and
unsubordinated debt. The subordinated debt securities will be entitled to
payment only after payment on our senior debt. In addition, the subordinated
debt securities will be effectively subordinated to creditors and preferred
shareholders of our subsidiaries. Our board of directors will determine the
terms of each series of debt securities being offered.
We will issue the debt securities under an indenture or indentures between
us and Chase Manhattan Bank and Trust Company, National Association, as the
trustee. In this document, we have summarized general features of the debt
securities from the indentures. We encourage you to read the indentures which
are exhibits to the registration statement of which this prospectus is a part.
Preferred Stock
We may issue shares of our preferred stock, par value $0.001 per share, in
one or more series. Our board of directors will determine the dividend, voting,
conversion and other rights of the series of shares of preferred stock being
offered.
Common Stock
We may issue shares of our common stock, par value $0.001 per share. In this
prospectus, we provide a general description of, among other things, our
dividend policy and the transfer and voting restrictions that apply to holders
of our common stock.
2
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Warrants
We may issue warrants for the purchase of debt securities, shares of
preferred stock or shares of common stock. Our board of directors will
determine the terms of the warrants.
3
<PAGE>
RISK FACTORS
Before investing in our securities, you should carefully consider the risks
described below and in any accompanying prospectus supplement as well as the
other information included or incorporated by reference in this prospectus.
This prospectus contains forward-looking statements that involve risk and
uncertainties, such as statements of our plans, objectives, expectations and
intentions. The cautionary statements made in this prospectus should be read as
being applicable to all related forward-looking statements wherever they appear
in this prospectus. These risk factors could cause our future results to differ
materially from those expressed or implied in any forward-looking statements
made by us. The risks and uncertainties described below are not the only ones
we face. Additional risks and uncertainties not presently known to us or that
we currently deem immaterial may also harm our business.
Our short operating history and heavy losses make our business difficult to
evaluate
Our limited operating history makes evaluating our business operations and
our prospects difficult. We began offering server hosting and Internet
connectivity services in 1995, opened our first dedicated Internet Data Center
in August 1996 and introduced managed services in 1997 and professional
services in 1998. Due to our short operating history, our business model is
still evolving. We have incurred operating losses and negative cash flows each
fiscal quarter and year since 1995. Our accumulated deficit was approximately
$286.6 million at March 31, 2000. We anticipate continuing to make significant
investments in new Internet Data Centers and network infrastructure, product
development, sales and marketing programs and personnel. We believe that we
will continue to experience net losses on a quarterly and annual basis for the
foreseeable future. We may also use significant amounts of cash and/or equity
to acquire complementary businesses, products, services or technologies.
Although we have experienced significant growth in revenues in recent periods,
this growth rate is not necessarily indicative of future operating results. It
is possible that we may never achieve profitability on a quarterly or an annual
basis.
Our operating results have fluctuated widely and we expect this to continue
We have experienced significant fluctuations in our results of operations on
a quarterly and an annual basis. We expect to continue to experience
significant fluctuations due to a variety of factors, many of which are outside
of our control, including:
. demand for and market acceptance of our services;
. reliable continuity of service and network availability;
. the ability to increase bandwidth as necessary, both on our network and
at our interconnection points with other networks;
. costs related to the acquisition of network capacity and arrangements
for interconnections with third-party networks;
. customer retention and satisfaction;
. capacity utilization of our Internet Data Centers;
. the timing, magnitude and integration of acquisitions of complementary
businesses and assets;
. the timing of customer installations;
. the provision of customer discounts and credits;
. the mix of services sold by us;
. the timing and success of marketing efforts and service introductions by
us and our competitors;
. the timing and magnitude of capital expenditures, including construction
costs relating to the expansion of operations;
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<PAGE>
. the timing of expansion of existing Internet Data Centers and completion
of new Internet Data Centers, including obtaining necessary permits and
adequate public utility power;
. the introduction by third parties of new Internet and networking
technologies;
. changes in our pricing policies and those of our competitors;
. fluctuations in bandwidth used by customers; and
. licenses and permits required to construct facilities, deploy networking
infrastructure or operate in the United States and foreign countries.
In addition, a relatively large portion of our expenses are fixed in the
short-term, particularly with respect to telecommunications, depreciation,
substantial interest expenses, real estate and personnel. Therefore, our
results of operations are particularly sensitive to fluctuations in revenues.
Furthermore, if we were to become unable to continue leveraging third-party
products in our services offerings, our product development costs could
increase significantly. Finally, many of our customers are emerging growth
companies which may have negative cash flows, and there is the possibility that
we will not be able to collect receivables on a timely basis.
Our rapid expansion produces a significant strain on our business and requires
us to expend substantial resources
The expansion of our network through the opening of additional Internet Data
Centers in geographically diverse locations is one of our key strategies. We
currently have 22 Internet Data Centers located in the following metropolitan
areas: Atlanta, Austin, Boston, Chicago, Frankfurt, London, Los Angeles, New
York, Seattle, Silicon Valley, Tokyo, Toronto and Washington, D.C. To expand
successfully, we must be able to assess markets, locate and secure new Internet
Data Center sites, install telecommunications circuits and equipment and
Internet Data Center facilities, and establish additional interconnections with
Internet service providers. To manage this expansion effectively, we must
continue to improve our operational and financial systems and expand, train and
manage our employee base. Our inability to establish additional Internet Data
Centers or effectively manage our expansion would have a material adverse
effect upon our business.
We expect to expend substantial resources for leases and/or the purchase of
real estate, significant improvements of facilities, purchase of complementary
businesses, assets and equipment, implementation of multiple telecommunications
connections and hiring of network, administrative, customer support and sales
and marketing personnel with the establishment of each new Internet Data
Center. Moreover, we expect to make additional significant investments in sales
and marketing and the development of new services as part of our expansion
strategy. The failure to generate sufficient cash flows or to raise sufficient
funds may require us to delay or abandon some or all of our development and
expansion plans or otherwise forego market opportunities, making it difficult
for us to generate additional revenue and to respond to competitive pressures.
In general, it takes us at least six months to select the appropriate
location for a new Internet Data Center, construct the necessary facilities,
install equipment and telecommunications infrastructure and hire operations and
sales personnel. Expenditures commence well before the Internet Data Center
opens, and it takes an extended period for us to approach break-even capacity
utilization. As a result, we expect that individual Internet Data Centers will
experience losses for in excess of one year from the time they are opened. We
incur further expenses from sales personnel hired to test market our services
in markets where there is no Internet Data Center. Growth in the number of our
Internet Data Centers is likely to increase the amount and duration of losses.
In addition, if we do not attract customers to new Internet Data Centers in a
timely manner, or at all, our business would be materially adversely affected.
We compete with much larger companies and there are few barriers to entry, and
if we cannot compete effectively, we will lose business
Our market is intensely competitive. There are few substantial barriers to
entry, and we expect to face additional competition from existing competitors
and new market entrants in the future. Many companies have
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announced that they intend to begin providing and/or greatly expand their
service offerings that are competitive with our services. The principal
competitive factors in this market include:
. the ability to deliver services when requested by the customer;
. Internet system engineering and other expertise;
. customer service;
. network capability, reliability, quality of service and scalability;
. the variety of services offered;
. access to network resources, including circuits, equipment and
interconnection capacity to other networks;
. broad geographic presence;
. price;
. the ability to maintain and expand distribution channels;
. brand name;
. the timing of introductions of new services;
. network security; and
. financial resources.
There can be no assurance that we will have the resources or expertise to
compete successfully in the future. Our current and potential competitors in
the market include:
. providers of server hosting services;
. national, foreign and regional ISPs;
. global, regional and local telecommunications companies and Regional
Bell Operating companies;
. IT outsourcing firms; and
. other technology services and products companies.
Many of our competitors have substantially greater resources, more
customers, longer operating histories, greater name recognition and more
established relationships in the industry. As a result, these competitors may
be able to develop and expand their network infrastructures and service
offerings more quickly, devote greater resources to the marketing and sale of
their products and adopt more aggressive pricing policies. In addition, these
competitors have entered and will likely continue to enter into business
relationships to provide additional services competitive with those we provide.
Some of our competitors may be able to provide customers with additional
benefits in connection with their Internet system and network management
solutions, including reduced communications costs, which could reduce the
overall costs of their services relative to ours. We may not be able to offset
the effects of any price reductions. In addition, we believe our market is
likely to encounter consolidation in the near future, which could result in
increased prices and other competition.
Our market is new and our services may not be generally accepted by enterprises
looking to outsource their mission-critical Internet operations, which could
harm our operating results
The market for Internet system and network management solutions has only
recently begun to develop, is evolving rapidly and is characterized by an
increasing number of market entrants. This market may not prove to be viable
or, if it becomes viable, may not continue to grow. We currently incur costs
greater than our
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revenues. If we cannot retain or grow our customer base, we will not be able to
increase our sales and revenues or create economies of scale to offset our
fixed and operating costs. Our future growth depends on the willingness of
enterprises to outsource the system and network management of their mission-
critical Internet operations and our ability to market our services in a cost-
effective manner to a sufficiently large number of customers. If this market
fails to develop, or develops more slowly than expected, or if our services do
not achieve market acceptance, our business would be adversely affected. In
addition, in order to be successful we must be able to differentiate ourselves
from our competition through our service offerings and delivery.
Our substantial leverage and debt service obligations adversely affect our cash
flow
We have substantial amounts of outstanding indebtedness, primarily from our
10 3/4% Senior Notes, 4 3/4% Convertible Subordinated Notes, 11 1/4% Senior
Notes, and our 5% Convertible Subordinated Notes. There is the possibility that
we may be unable to generate cash sufficient to pay the principal of, interest
on and other amounts due in respect of, certain of our debt securities when
due. As of March 31, 2000, we had debt of approximately $1.4 billion. We also
have the right to issue $100.0 million of additional 10 3/4% Senior Notes on or
prior to December 8, 2000 and we expect to issue additional series of senior
debt securities in an aggregate principal amount of approximately $1.2 billion.
Furthermore, we expect to enter into new secured credit facilities for up to
$750 million, and our debt securities would be effectively subordinated to any
borrowings under the credit facilities. In addition, we expect to add
additional equipment loans and lease lines to finance capital expenditures for
our Internet Data Centers and to obtain additional long-term debt, working
capital lines of credit and lease lines. We cannot be certain that any
financing arrangements will be available.
Our substantial leverage could have significant negative consequences,
including:
. increasing our vulnerability to general adverse economic and industry
conditions;
. limiting our ability to obtain additional financing;
. requiring the dedication of a substantial portion of our expected cash
flow from operations to service our indebtedness, thereby reducing the
amount of our expected cash flow available for other purposes, including
capital expenditures;
. limiting our flexibility in planning for, or reacting to, changes in our
business and the industry in which we compete; and
. placing us at a possible competitive disadvantage compared to less
leveraged competitors and competitors that have better access to capital
resources.
We are subject to restrictive covenants in our note indentures that limit our
flexibility in managing our business
Our existing debt securities contain various restrictions on our ability to
incur debt, pay dividends or make other restricted payments, sell assets, enter
into affiliate transactions and take other actions. Furthermore, our existing
financing arrangements are, and future financing arrangements are likely to be,
secured by substantially all of our assets. The existing financing arrangements
require, and future financing arrangements are likely to require, that we
maintain specific financial ratios and comply with covenants restricting our
ability to incur debt, pay dividends or make other restricted payments, sell
assets, enter into affiliate transactions or take other actions.
In addition, a number of instruments evidencing our debt restrict the manner
in which the funds raised in our debt financings and debt incurred in the
future may be used.
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We must manage growth effectively by expanding operating and financial
procedures, controls and systems or our business will be harmed
We are experiencing, and expect to continue experiencing, rapid growth with
respect to the building of our Internet Data Centers and network
infrastructure, acquisitions of assets and companies, expansion of our service
offerings, geographic expansion, expansion of our customer base and increases
in the number of employees. This growth has placed, and we expect it to
continue to place, a significant strain on our financial, management,
operational and other resources, including our ability to ensure customer
satisfaction. This expansion also requires significant time commitment from our
senior management and places a significant strain on their ability to manage
the existing business. In addition, we are required to manage multiple
relationships with a growing number of third parties as we seek to complement
our service offerings. Our ability to manage our growth effectively will
require us to continue to expand operating and financial procedures and
controls, to replace or upgrade our operational, financial and management
information systems and to attract, train, motivate and retain key employees.
We have recently hired many key employees and officers, and as a result, our
entire management team has worked together for only a brief time. In addition,
we intend to hire additional senior management personnel to support our growth
and expansion of our business. If our executives are unable to manage growth
effectively, our business could be materially adversely affected.
We may experience difficulty in integrating our acquisitions, which could harm
our operating results
In October 1998 we acquired the assets of Arca, in February 1999 we acquired
AIS, in July 1999 we acquired Cohesive, in November 1999 we acquired Service
Metrics, and in December 1999 we acquired GOL. Furthermore, in February 2000,
we completed our acquisition of KeyLabs and in April 2000 we completed our
equity investment in Mirror Image. We continue to expend resources integrating
Cohesive, Service Metrics and KeyLabs, and the personnel hired in connection
with these acquisitions. As we acquire additional companies, we will incur
additional expenses.
We believe that our future growth depends, in part, upon the acquisition of
complementary businesses, products, services or technologies. After purchasing
a company, we could have difficulty in assimilating that company's technology,
personnel and operations. In addition, the key personnel of the acquired
company may decide not to work for us. These difficulties could disrupt our
ongoing business, distract our management and employees and increase our
expenses. In addition, future acquisitions by us may require us to issue stock
that could dilute the ownership of our then existing stockholders, incur
additional debt or assume liabilities, result in large one-time write-offs or
create goodwill or other intangible assets that could result in amortization
expenses.
System failures could lead to significant costs
We must protect our network infrastructure, our equipment, and customers'
equipment against damage from human error, physical or electronic security
breaches, power loss and other facility failures, fire, earthquake, flood,
telecommunications failure, sabotage, vandalism and similar events. Despite
precautions we have taken, a natural disaster or other unanticipated problems
at one or more of our Internet Data Centers could result in interruptions in
our services or significant damage to customer equipment. In addition, failure
of any of our telecommunications providers, such as MCI WorldCom, Qwest
Communications Corporation and Global Crossing, to provide consistent data
communications capacity, and local exchange carriers to provide interconnection
agreements, could result in interruptions in our services. Any damage to or
failure of our systems or service providers could result in reductions in, or
terminations of, services supplied to our customers, which could have a
material adverse effect on our business. In the past, we have experienced
interruptions in specific circuits within our network resulting from events
outside our control, temporary loss of power, and failure of networking
equipment, all of which led to short-term degradation in the level of
performance of our network or temporary unavailability of our services. We
attempt to limit exposure to system downtime by contract by giving customers a
credit of free service for a short period of time for disruptions. However,
customers may demand additional remedies. If we incur significant service level
commitment
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obligations in connection with system downtime, our liability insurance may not
be adequate to cover those expenses.
Customer satisfaction with our services is critical to our success
Our customers demand a very high level of service and services are an
increasingly significant portion of our offerings. As customers outsource more
mission-critical operations to us, we are subject to increased liability claims
and customer dissatisfaction if our systems fail or our customers otherwise
become unsatisfied. Our customer contracts generally provide a limited service
level commitment related to the continuous availability of service on a 24
hours per day, seven days per week basis. This commitment is generally limited
to a credit consisting of free service for a short period of time for
disruptions in Internet transmission services. If we incur significant service
level commitment obligations in connection with system downtime, our liability
insurance may not be adequate to cover these expenses.
Our ability to expand our network is unproven and will require substantial
financial, operational and management resources
To satisfy customer requirements, we must continue to expand and adapt our
network infrastructure. We are dependent on MCI WorldCom, Qwest, Global
Crossing and other telecommunications providers for our network capacity. The
expansion and adaptation of our telecommunications infrastructure will require
substantial financial, operational and management resources as we negotiate
telecommunications capacity with network infrastructure suppliers. Due to the
limited deployment of our services to date, our ability to connect and manage a
substantially larger number of customers at high transmission speeds is
unknown. We have yet to prove our network's ability to be scaled up to higher
customer levels while maintaining superior performance. Furthermore, it may be
difficult for us to increase quickly our network capacity in light of current
necessary lead times within the industry to purchase circuits and other
critical items. If we fail to achieve or maintain high capacity data
transmission circuits, customer demand could diminish because of possible
degradation of service. In addition, as we upgrade our telecommunications
infrastructure to increase bandwidth available to our customers, we expect to
encounter equipment or software incompatibility, which may cause delays in
implementation.
We depend on network interconnections provided by third parties who may raise
their fees or deny access
We rely on a number of public and private network interconnections to allow
our customers to connect to other networks. If the networks with which we
interconnect were to discontinue their interconnections, our ability to
exchange traffic would be significantly constrained. Furthermore, our business
will be harmed if these networks do not add more bandwidth to accommodate
increased traffic. Many of the companies with which we maintain
interconnections are our competitors. Some of these networks require that we
pay them fees for the right to maintain interconnections. There is nothing to
prevent any networks, many of which are significantly larger than we are, from
increasing fees or denying access. In early 2000, one network with whom we
previously maintained interconnections unilaterally terminated their
interconnections. In the future, other networks could refuse to continue to
interconnect directly with us, might impose significant costs on us or limit
our customers' access to their networks. In this event, we may not be able on a
cost-effective basis to access alternative networks to exchange our customers'
traffic. In addition, we may not be able to pass through to our customers any
additional costs of utilizing these networks. In these cases, our business
could be harmed.
Difficulties presented by international economic, political, legal, accounting
and business factors could harm our business in international markets
A component of our strategy is to expand into international markets. We
opened our first Internet Data Center outside of the United States in the
London metropolitan area in June 1999 and acquired an Internet Data Center in
Tokyo through our acquisition of GOL in December 1999. In April 2000, we opened
two additional
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Internet Data Centers in Frankfurt and Toronto. Furthermore, we plan to open
additional international Internet Data Centers by the end of 2000. In order to
expand our international operations, we may enter into joint ventures or
outsourcing agreements with third parties, acquire rights to high-bandwidth
transmission capability, acquire complementary businesses or operations, or
establish and maintain new operations outside of the United States. Thus, we
may depend on third parties to be successful in our international operations.
In addition, the rate of development and adoption of the Internet has been
slower outside of the United States, and the cost of bandwidth has been higher,
which may adversely affect our ability to expand operations and may increase
our cost of operations internationally. The risks inherent in conducting
business internationally include:
. unexpected changes in regulatory requirements, export restrictions,
tariffs and other trade barriers;
. challenges in staffing and managing foreign operations;
. differences in technology standards;
. employment laws and practices in foreign countries;
. longer payment cycles and problems in collecting accounts receivable;
. political instability;
. fluctuations in currency exchange rates and imposition of currency
exchange controls; and
. potentially adverse tax consequences.
We might not be successful in our attempts to keep up with rapid technological
change and evolving industry standards
Our future success will depend on our ability to offer services that
incorporate leading technology and address the increasingly sophisticated and
varied needs of our current and prospective customers. Our market is
characterized by rapidly changing and unproven technology, evolving industry
standards, changes in customer needs, emerging competition and frequent new
service introductions. Future advances in technology may not be beneficial to,
or compatible with, our business. In addition, we may not be able to
incorporate advances on a cost-effective and timely basis. Moreover,
technological advances may have the effect of encouraging our current or future
customers to rely on in-house personnel and equipment to furnish the services
we currently provide. In addition, keeping pace with technological advances may
require substantial expenditures and lead time.
We believe that our ability to compete successfully is also dependent upon
the continued compatibility and interoperability of our services with products,
services and architectures offered by various vendors. Although we work with
various vendors in testing newly developed products, these products may not be
compatible with our infrastructure or adequate to address changing customer
needs. Any incompatibility would require us to make significant investments to
achieve compatibility. Although we intend to support emerging standards,
industry standards may not be established or we may not be able to conform
timely to new standards. Our failure to conform to a prevailing standard, or
the failure of a common standard to emerge, could have a material adverse
effect on our business.
System security risks could disrupt our services
The ability to provide secure transmissions of confidential information over
networks accessible to the public is a significant barrier to electronic
commerce and communications. A portion of our services rely on encryption and
authentication technology licensed from third parties. Despite a variety of
network security measures taken by us, we cannot assure that unauthorized
access, computer viruses, accidental or intentional actions and other
disruptions will not occur. Recently, numerous computer viruses have circulated
throughout the world. Our network and our customer sites are potentially
vulnerable to these viruses, which could harm our results of operations. Our
Internet Data Centers have experienced and may in the future experience delays
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or interruptions in service as a result of the accidental or intentional
actions of Internet users, current and former employees of Exodus or others.
Furthermore, inappropriate use of the network by third parties could also
jeopardize the security of confidential information, such as customer and
Exodus passwords as well as credit card and bank account numbers, stored in our
computer systems or those of our customers. As a result, we could become liable
to others and lose existing or potential customers. The costs required to
eliminate computer viruses and alleviate other security problems could be
prohibitively expensive. In addition, the efforts to address these problems
could result in interruptions, delays or cessation of service to our customers.
We depend on third-party equipment and software suppliers
We depend on vendors to supply key components of our telecommunications
infrastructure and system and network management solutions. Some of the
telecommunications services and networking equipment is available only from
sole or limited sources. For instance, the routers, switches and modems we use
are currently supplied primarily by Cisco Systems, Inc. We typically purchase
or lease all of our components under purchase orders placed from time to time.
We do not carry significant inventories of components and have no guaranteed
supply arrangements with vendors. If we are unable to obtain required products
or services on a timely basis and at an acceptable cost, our business would be
harmed. In addition, if our sole or limited source suppliers do not provide
products or components that comply with evolving Internet and
telecommunications standards or that interoperate with other products or
components we use, our business would be harmed. For example, we have
experienced performance problems, including previously unknown software and
firmware bugs, with routers and switches that have caused temporary disruptions
in and impairment of network performance.
Government regulation and legal uncertainties may harm our business
Laws and regulations directly applicable to communications and commerce over
the Internet are becoming more prevalent. The United States Congress has
recently considered enacting Internet laws regarding children's privacy,
copyrights, taxation and the transmission of sexually explicit material. The
European Union also enacted its own privacy regulations. The law of the
Internet, however, remains largely unsettled, even in areas where there has
been some legislative action. It may take years to determine whether and how
existing laws such as those governing intellectual property, privacy, libel and
taxation apply to the Internet. In addition, the growth and development of the
market for online commerce may prompt calls for more stringent consumer
protection laws, both in the United States and abroad, that may impose
additional burdens on companies conducting business online. The adoption or
modification of laws or regulations relating to the Internet could adversely
affect our business. We provide services over the Internet in many states in
the United States and in many foreign countries, and we facilitate the
activities of our customers in these jurisdictions. As a result we may be
required to qualify to do business, or be subject to taxation, or be subject to
other laws and regulations, in these jurisdictions even if we do not have a
physical presence or employees or property in these jurisdictions. The
application of these multiple sets of laws and regulations is uncertain, but we
could find that Exodus is subject to regulation, taxation, enforcement or other
liability in unexpected ways, which could materially adversely affect our
business.
We could be held liable for the information disseminated through our network
The law relating to the liability of online services companies and Internet
access providers for information and commerce carried on or disseminated
through their networks is currently unsettled. The Child Online Protection Act
of 1998 imposes criminal penalties and civil liability on anyone engaged in the
business of selling or transferring material that is harmful to minors, by
means of the World Wide Web, without restricting access to this type of
material by underage persons. Numerous states have adopted or are currently
considering similar types of legislation. The imposition upon us and other
Internet network providers of potential liability for information carried on or
disseminated through systems could require us to implement measures to reduce
exposure to liability, which may require the expenditure of substantial
resources, or to discontinue various service or product offerings. Further, the
costs of defending against any claims and potential adverse outcomes of these
claims could have a material adverse effect on our business. While we carry
professional liability
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insurance, it may not be adequate to compensate or may not cover us in the
event we become liable for information carried on or disseminated through our
networks.
Some businesses, organizations and individuals have in the past sent
unsolicited commercial e-mail messages through our network or advertising sites
hosted at our facilities to a massive number of people. This practice, known as
"spamming," has led to some complaints against us. In addition, some ISPs and
other online services companies could deny network access to us if we allow
undesired content or spamming to be transmitted through our networks. Although
we prohibit customers by contract from spamming, we cannot be sure that
customers will not engage in this practice, which could have a material adverse
effect on our business.
Our future success depends on our key personnel
Our success depends in significant part upon the continued services of our
key technical, sales and senior management personnel. Any officer or employee
can terminate his or her relationship at any time. If we lose the services of
one or more of our key employees or are unable to attract additional qualified
personnel, our business would be adversely affected. We do not carry key-person
life insurance for any of our employees.
If the Internet and Internet infrastructure development do not continue to
grow, our business will be harmed
Our success depends in large part on continued growth in the use of the
Internet. Critical issues concerning the commercial use of the Internet,
including security, reliability, cost, ease of access, quality of service and
necessary increases in bandwidth availability, remain unresolved and are likely
to affect the development of the market for our services. In addition, the rate
of development and adoption of the Internet has been slower outside of the
United States and the cost of bandwidth has been higher. The recent growth in
the use of the Internet has caused frequent periods of performance degradation,
requiring the upgrade of routers and switches, telecommunications links and
other components forming the infrastructure of the Internet by ISPs and other
organizations with links to the Internet. Any perceived degradation in the
performance of the Internet as a whole could undermine the benefits of our
services. Consequently, the emergence and growth of the market for our services
is dependent on improvements being made to the entire Internet infrastructure
to alleviate overloading and congestion.
We face risks associated with protection and enforcement of intellectual
property rights
We rely on a combination of copyright, patent trademark, service mark and
trade secret laws and contractual restrictions to establish and protect
proprietary rights in our products and services. We have very little patented
technology that would preclude or inhibit competitors from entering our market.
Although we have entered into confidentiality agreements with our employees,
contractors, suppliers, distributors and appropriate customers to limit access
to and disclosure of our proprietary information, these may prove insufficient
to prevent misappropriation of our technology or to deter independent third-
party development of similar technologies. In addition, the laws of various
foreign countries may not protect our products, services or intellectual
property rights to the same extent as do the laws of the United States.
In addition to licensing technologies from third parties, we are developing
and acquiring additional proprietary intellectual property. Third parties may
try to claim that our products or services infringe their intellectual
property. We expect that participants in our markets will be increasingly
subject to infringement claims. Any claim, whether meritorious or not, could be
time consuming, result in costly litigation, cause product installation delays
or require us to enter into royalty or licensing agreements. These royalty or
licensing agreements might not be available on terms acceptable to us or at
all.
Our stock price has been volatile in the past and is likely to continue to be
volatile
The market price of our common stock has been volatile in the past and is
likely to continue to be volatile. In addition, the securities markets in
general, and Internet stocks in particular, have experienced significant price
volatility and accordingly the trading price of our common stock is likely to
be affected by this activity.
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DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus includes "forward-looking statements" within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act. When
used in this prospectus, the words "anticipate," "believe," "estimate," "will,"
"may," "intend" and "expect" and similar expressions generally identify
forward-looking statements. Although we believe that our plans, intentions and
expectations reflected in the forward-looking statements are reasonable, we
cannot be sure that they will be achieved. Forward-looking statements in this
prospectus include those relating to the expansion of our network through the
opening of additional Internet Data Centers and the timing of openings, the
upgrading of our telecommunications infrastructure, our planned introduction of
various new products and services, the possibility of acquiring complementary
businesses, products, services and technologies and our ability to make
required payments on our current and future debt instruments. Actual results,
performance or achievements could differ materially from those contemplated by
the forward-looking statements contained in this prospectus. Important factors
that could cause actual results to differ materially from our forward-looking
statements are set forth in this prospectus, including under the heading "Risk
Factors." These factors are not intended to represent a complete list of the
general or specific factors that may affect us. It should be recognized that
other factors, including general economic factors and business strategies, may
be significant, presently or in the future, and the factors set forth in this
prospectus may affect us to a greater extent than indicated. All forward-
looking statements attributable to us or persons acting on our behalf are
expressly qualified in their entirety by the cautionary statements set forth in
this prospectus. Except as required by law, we undertake no obligation to
update any forward-looking statement, whether as a result of new information,
future events or otherwise.
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USE OF PROCEEDS
We will use the net proceeds from the sale of securities that we may offer
under this prospectus and any accompanying prospectus supplement for general
corporate purposes. General corporate purposes may include repayment of debt,
capital expenditures, possible acquisitions, investments, repurchase of our
capital stock and any other purposes that we may specify in any prospectus
supplement. We may invest the net proceeds temporarily or use them to repay
short-term debt until we use them for their stated purpose.
DIVIDEND POLICY
We do not anticipate paying dividends on our common stock in the foreseeable
future. The terms of some of our debt instruments place limitations on our
ability to pay dividends. Future dividends on our common stock, if any, will be
at the discretion of our board of directors and will depend on, among other
things, our operations, capital requirements and surplus, general financial
condition, contractual restrictions and such other factors as our board of
directors may deem relevant.
RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED DIVIDENDS
The following table presents our historical ratios of earnings to fixed
charges and preferred dividends for the periods indicated:
<TABLE>
<CAPTION>
Three months
Year Ended December 31 ended March 31
----------------------------------------------- ------------------
1995 1996 1997 1998 1999 1999 2000
------- ------- -------- -------- --------- -------- --------
(in thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio................... -- -- -- -- -- -- --
Deficiency.............. $(1,311) $(4,133) $(25,298) $(67,316) $(130,323) $(23,232) $(58,350)
</TABLE>
For the purpose of this computation, earnings are defined as income (loss)
before income taxes plus fixed charges and preferred dividends. Fixed charges
consist of interest expense, including amortization of deferred debt issuance
costs and the interest portion of capital lease obligations, and the portion of
rental expense that is representative of the interest factor, deemed to be one-
third of minimum operating lease rentals.
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DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the debt securities summarizes
some general terms that will apply to the debt securities. The description is
not complete, and we refer you to the indentures, which we filed with the SEC
as exhibits to the registration statement of which this prospectus is a part.
General
The debt securities will be either our senior debt securities or our
subordinated debt securities. We will issue our debt securities under one or
more separate indentures between us and Chase Manhattan Bank and Trust Company,
National Association, as trustee. Senior debt securities will be issued under a
senior indenture and subordinated securities will be issued under a
subordinated indenture. Together the senior indenture and the subordinated
indenture are called the "indentures". A copy of the form of each type of
indenture will be filed as an exhibit to the registration statement of which
this prospectus is a part. The indentures may be supplemented by one or more
supplemental indentures. We refer to the indentures, together with any
supplemental indentures, as the "indentures" throughout the remainder of this
prospectus.
The indentures do not limit the amount of debt securities that we may issue.
The indentures provide that debt securities may be issued up to the principal
amount that we authorize from time to time. The senior debt securities will be
unsecured and will have the same rank as all of our other unsecured and
unsubordinated debt. The subordinated debt securities will be unsecured and
will be subordinated and junior to all senior indebtedness. The terms of the
indentures do not contain any covenants or other provisions designed to give
holders of any debt securities protection against changes in our operations,
financial condition or transactions involving us, but those provisions may be
included in the documents that include the specific terms of the debt
securities.
We may issue the debt securities in one or more separate series of senior
debt securities and subordinated debt securities. The prospectus supplement
relating to the particular series of debt securities being offered will specify
the particular amounts, prices and terms of those debt securities. These terms
may include:
. the title of the debt securities;
. any limit upon the aggregate principal amount of the debt securities;
. if other than United States dollars, the currency or currencies,
including the euro and other composite currencies, in which payments on
the debt securities will be payable and whether the holder may elect
payment to be made in a different currency;
. the date or dates when payments on the principal must be made or the
method of determining that date or dates;
. interest rates, and the dates from which interest, if any, will accrue,
and the dates when interest is payable and the maturity;
. the right, if any, to extend the interest payment periods and the
duration of the extensions;
. the places where payments may be made and the manner of payments;
. any mandatory or optional redemption provisions;
. any subordination provisions;
. the denominations in which debt securities will be issued;
. the terms applicable to any debt securities issued at a discount from
their stated principal amount;
. the currency or currencies of payment of principal or interest; and the
period, if any, during which a holder may elect to pay in a currency
other than the currency in which the debt securities are denominated;
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. if the amount of payments of principal or interest is to be determined
by reference to an index or formula, or based on a coin or currency
other than that in which the debt securities are stated to be payable,
the manner in which these amounts are determined and the calculation
agent, if any;
. whether the debt securities will be issued in fully registered form
without coupons or in bearer form, with or without coupons, or any
combination of these, and whether they will be issued in the form of one
or more global securities in temporary or definitive form;
. whether and on what terms we will pay additional amounts to holders of
the debt securities that are not United States persons in respect of any
tax, assessment or governmental charge withheld or deducted and, if so,
whether and on what terms we will have the option to redeem the debt
securities rather than pay the additional amounts;
. the certificates or forms required for the issuance of debt securities
in definitive form;
. the trustees, depositaries, authenticating or paying agents, transfer
agents or registrars of the debt securities;
. any deletions of, or changes or additions to, the events of default or
covenants;
. conversion or exchange provisions, if any, including conversion or
exchange prices or rates and adjustments to those prices and rates; and
. any other specific terms of the debt securities.
If any debt securities are sold for any foreign currency or currency unit or
if any payments on the debt securities are payable in any foreign currency or
currency unit, the prospectus supplement will contain any restrictions,
elections, tax consequences, specific terms and other information with respect
to the debt securities and the foreign currency or currency unit.
Some of the debt securities may be issued as original issue discount debt
securities. Original issue discount securities may bear no interest or bear
interest at below-market rates and will be sold at a discount below their
stated principal amount and may bear no or below market interest. The
applicable prospectus supplement will also contain any special tax, accounting
or other information relating to original issue discount securities other kinds
of debt securities that may be offered, including debt securities linked to an
index or payable in currencies other than United States dollars.
Senior Debt Securities
Payment of the principal of, premium, if any, and interest on senior debt
securities will rank on a parity with all of our other unsecured and
unsubordinated debt.
Subordinated Debt Securities
Payment of the principal of, premium, if any, and interest on subordinated
debt securities will be junior in right of payment to the prior payment in full
of all of our unsubordinated debt, including senior debt securities. We will
state in the applicable prospectus supplement relating to any subordinated debt
securities the subordination terms of the securities as well as the aggregate
amount of outstanding debt, as of the most recent practicable date, that by its
terms would be senior to the subordinated debt securities. We will also state
in such prospectus supplement limitations, if any, on issuance of additional
senior debt. In addition, the subordinated debt securities will be effectively
subordinated to creditors and preferred shareholders of our subsidiaries.
Registrar and Paying Agent
The debt securities may be presented for registration of transfer or for
exchange at the corporate trust office of the security registrar or at any
other office or agency that we maintain for those purposes. In addition,
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the debt securities may be presented for payment of principal, interest and
any premium at the office of the paying agent or at any office or agency that
we maintain for those purposes.
Chase Manhattan Bank and Trust Company, National Association, is our
designated security registrar and paying agent for the debt securities.
Global Securities
We may issue a series of debt securities in whole or in part in the form of
one or more global certificates that will be deposited with a depositary we
will identify in a prospectus supplement. We may issue global debt securities
in either registered or unregistered form and in either temporary or
definitive form. We will describe the specific terms of the depositary
arrangement with respect to any series of debt securities in the prospectus
supplement.
Conversion or Exchange Rights
Debt securities may be convertible into or exchangeable for shares of our
equity securities or equity securities of our subsidiaries or affiliates. The
terms and conditions of conversion or exchange will be stated in the
applicable prospectus supplement. The terms will include, among others, the
following:
. the conversion or exchange price;
. the conversion or exchange period;
. provisions regarding the convertibility or exchangeability of the debt
securities, including who may convert or exchange;
. events requiring adjustment to the conversion or exchange price;
. provisions affecting conversion or exchange in the event of our
redemption of the debt securities; and
. any anti-dilution provisions, if applicable.
Registered Global Securities
Unless and until it is exchanged in whole or in part for debt securities in
definitive registered form, a registered global security may not be
transferred except as a whole:
. by the depositary for that registered global security to its nominee;
. by a nominee of the depositary to the depositary or another nominee of
the depositary; or
. by the depositary or its nominee to a successor of the depositary or a
nominee of the successor.
The prospectus supplement relating to a series of debt securities will
describe the specific terms of the depositary arrangement involving any
portion of the series represented by a registered global security.
We anticipate that the following provisions will apply to all depositary
arrangements for debt securities:
. ownership of beneficial interests in a registered global security will
be limited to persons that have accounts with the depositary for that
registered global security, these persons being referred to as
"participants", or persons that may hold interests through participants;
. upon the issuance of a registered global security, the depositary for
the registered global security will credit, on its book-entry
registration and transfer system, the participants' accounts with the
respective principal amounts of the debt securities represented by the
registered global security beneficially owned by the participants;
. any dealers, underwriters or agents participating in the distribution of
the debt securities will designate the accounts to be credited; and
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. ownership of beneficial interest in that registered global security will
be shown on, and the transfer of that ownership interest will be
effected only through, records maintained by the depositary for that
registered global security for interests of participants and on the
records of participants for interests of persons holding through
participants.
The laws of some states may require that specified purchasers of securities
take physical delivery of the securities in definitive form. These laws may
limit the ability of those persons to own, transfer or pledge beneficial
interests in registered global securities.
So long as the depositary for a registered global security, or its nominee,
is the registered owner of that registered global security, the depositary or
that nominee will be considered the sole owner or holder of the debt securities
represented by the registered global security for all purposes under the
indenture. Except as stated below, owners of beneficial interests in a
registered global security:
. will not be entitled to have the debt securities represented by a
registered global security registered in their names;
. will not receive or be entitled to receive physical delivery of the debt
securities in definitive form; and
. will not be considered the owners or holders of the debt securities
under the indenture.
Accordingly, each person owning a beneficial interest in a registered global
security must rely on the procedures of the depositary for the registered
global security and, if the person is not a participant, on the procedures of a
participant through which the person owns its interest, to exercise any rights
of a holder under the indenture.
We understand that under existing industry practices, if we request any
action of holders or if an owner of a beneficial interest in a registered
global security desires to give or take any action that a holder is entitled to
give or take under the indenture, the depositary for the registered global
security would authorize the participants holding the relevant beneficial
interests to give or take the action, and the participants would authorize
beneficial owners owning through the participants to give or take the action or
would otherwise act upon the instructions of beneficial owners holding through
them.
We will make payments of principal and premium, if any, and interest, if
any, on debt securities represented by a registered global security registered
in the name of a depositary or its nominee to the depositary or its nominee as
the registered owners of the registered global security. None of us, the
trustee or any other of our agents or agents of the trustee will be responsible
or liable for any aspect of the records relating to, or payments made on
account of, beneficial ownership interests in the registered global security or
for maintaining, supervising or reviewing any records relating to the
beneficial ownership interests.
We expect that the depositary for any debt securities represented by a
registered global security, upon receipt of any payments of principal and
premium, if any, and interest, if any, in respect of the registered global
security, will immediately credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the
registered global security as shown on the records of the depositary. We also
expect that standing customer instructions and customary practices will govern
payments by participants to owners of beneficial interests in the registered
global security held through the participants, as is now the case with the
securities held for the accounts of customers in bearer form or registered in
"street name". We also expect that any of these payments will be the
responsibility of the participants.
If the depositary for any debt securities represented by a registered global
security is at any time unwilling or unable to continue as depositary or stops
being a clearing agency registered under the Exchange Act, we will appoint an
eligible successor depositary. If we fail to appoint an eligible successor
depositary within 90 days, we will issue the debt securities in definitive form
in exchange for the registered global security. In addition, we may at any time
and in our sole discretion decide not to have any of the debt securities of a
series
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represented by one or more registered global securities. In that event, we will
issue debt securities of the series in a definitive form in exchange for all of
the registered global securities representing the debt securities. The trustee
will register any debt securities issued in definitive form in exchange for a
registered global security in the name or names as the depositary, based upon
instructions from its participants, will instruct the trustee.
We may also issue bearer debt securities of a series in the form of one or
more global securities, referred to as "bearer global securities". We will
deposit these securities with a common depositary for Euroclear System and
Clearstream Banking, or with a nominee for the depositary identified in the
prospectus supplement relating to the series. The prospectus supplement
relating to a series of debt securities represented by a bearer global security
will describe the applicable terms and procedures. These will include the
specific terms of the depositary arrangement and any specific procedures for
the issuance of debt securities in definitive form in exchange for a bearer
global security, in proportion to the series represented by a bearer global
security.
Merger, Consolidation or Sale of Assets
Under the terms of indentures, we may consolidate or merge with another
company, or sell, lease or convey all or substantially all our assets to
another company, if Exodus is either the continuing entity or, if Exodus is not
the continuing entity:
. the successor entity is organized under the laws of the United States of
America and expressly assumes all payments on all of the debt securities
and the performance and observance of all the covenants and conditions
of the applicable indenture; and
. the merger, sale of assets or other transaction must not cause a default
on the debt securities and we must not already be in default.
Events of Default
Unless otherwise provided for in the prospectus supplement, the term "event
of default", when used in the indentures means any of the following:
. failure to pay interest for 30 days after the date payment is due and
payable; however, if we extend an interest payment period under the
terms of the debt securities, the extension will not be a failure to pay
interest;
. failure to pay principal or premium, if any, on any debt security when
due, either at maturity, upon any redemption, by declaration or
otherwise;
. failure to make sinking fund payments, if any, when due;
. failure to perform other covenants for 60 days after notice that
performance was required;
. events in bankruptcy, insolvency or reorganization of our company; or
. any other event of default provided in the applicable resolution of our
board of directors or the supplemental indenture under which we issue a
series of debt securities.
An event of default for a particular series of debt securities does not
necessarily constitute an event of default for any other series of debt
securities issued under an indenture. If an event of default relating to the
payment of interest, principal or any sinking fund installment involving any
series of debt securities has occurred and is continuing, the trustee or the
holders of not less than 25% in aggregate principal amount of the debt
securities of each affected series may declare the entire principal of all the
debt securities of that series to be due and payable immediately.
If an event of default relating to the performance of other covenants occurs
and is continuing for a period of 60 days after notice of that event of
default, or if any other event of default occurs and is continuing involving
all of the series of senior debt securities, then the trustee or the holders of
not less than 25% in aggregate principal amount of all of the series of senior
debt securities may declare the entire principal amount of all of the series of
senior debt securities due and payable immediately.
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Similarly, if an event of default relating to the performance of other
covenants occurs and is continuing for a period of 60 days after notice, or if
any other event of default occurs and is continuing involving all of the series
of subordinated debt securities, then the trustee or the holders of not less
than 25% in aggregate principal amount of all of the series of subordinated
debt securities may declare the entire principal amount of all of the series of
subordinated debt securities due and payable immediately.
If, however, the event of default relating to the performance of other
covenants or any other event of default that has occurred and is continuing is
for less than all of the series of senior debt securities or subordinated debt
securities, then, the trustee or the holders of not less than 25% in aggregate
principal amount of each affected series of the senior debt securities or the
subordinated debt securities, as the case may be, may declare the entire
principal amount of all debt securities of that affected series due and payable
immediately. The holders of not less than a majority, or any applicable
supermajority, in aggregate principal amount of the debt securities of a series
may, after satisfying conditions, rescind and annul any of the above-described
declarations and consequences involving the series.
If an event of default relating to events in bankruptcy, insolvency or
reorganization occurs and is continuing, then the principal amount of all of
the debt securities outstanding, and any accrued interest, will automatically
become due and payable immediately, without any declaration or other act by the
trustee or any holder.
Each indenture imposes limitations on suits brought by holders of debt
securities against us. Except for actions for payment of overdue principal or
interest, no holder of debt securities of any series may institute any action
against us under each indenture unless:
. the holder has previously given to the trustee written notice of default
and continuance of that default;
. the holders of at least 25% in principal amount of the outstanding debt
securities of the affected series have requested that the trustee
institute the action;
. the requesting holders have offered the trustee reasonable indemnity for
expenses and liabilities that may be incurred by bringing the action;
. the trustee has not instituted the action within 60 days of the request;
and
. the trustee has not received inconsistent direction by the holders of a
majority in principal amount of the outstanding debt securities of the
series.
We will be required to file annually with the trustee a certificate, signed
by an officer of our company, stating whether or not the officer knows of any
default by us in the performance, observance or fulfillment of any condition or
covenant of an indenture.
Discharge, Defeasance and Covenant Defeasance
We can discharge or defense our obligations under the indentures as stated
below or as provided in the prospectus supplement.
Unless otherwise provided in the applicable prospectus supplement, we may
discharge obligations to holders of any series of debt securities that have not
already been delivered to the trustee for cancellation and that have either
become due and payable or are by their terms to become due and payable, or are
scheduled for redemption, within one year. We may effect a discharge by
irrevocably depositing with the trustee cash or United States government
obligations, as trust funds, in an amount certified to be enough to pay when
due, whether at maturity, upon redemption or otherwise, the principal of,
premium, if any, and interest on the debt securities and any mandatory sinking
fund payments.
Unless otherwise provided in the applicable prospectus supplement, we may
also discharge any and all of our obligations to holders of any series of debt
securities at any time, which we refer to as "defeasance". We may also be
released from the obligations imposed by any covenants of any outstanding
series of debt
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securities and provisions of the indentures, and we may omit to comply with
those covenants without creating an event of default under the trust
declaration, which we refer to as "covenant defeasance". We may effect
defeasance and covenant defeasance only if, among other things:
. we irrevocably deposit with the trustee cash or United States government
obligations, as trust funds, in an amount certified to be enough to pay
at maturity, or upon redemption, the principal, premium, if any, and
interest on all outstanding debt securities of the series;
. we deliver to the trustee an opinion of counsel from a nationally
recognized law firm to the effect that (a) in the case of covenant
defeasance, the holders of the series of debt securities will not
recognize income, gain or loss for United States federal income tax
purposes as a result of the defeasance, and will be subject to tax in
the same manner and at the same times as if no covenant defeasance had
occurred and (b) in the case of defeasance, either we have received
from, or there has been published by, the Internal Revenue Service a
ruling or there has been a change in applicable United States federal
income tax law, and based on that ruling or change, the holders of the
series of debt securities will not recognize income, gain or loss for
United States federal income tax purposes as a result of the defeasance
and will be subject to tax in the same manner as if no defeasance had
occurred; and
. in the case of subordinated debt securities, no event or condition will
exist that, based on the subordination provisions applicable to the
series, would prevent us from making payments of principal of, premium,
if any, and interest on any of the applicable subordinated debt
securities at the date of the irrevocable deposit referred to above or
at any time during the period ending on the 91st day after the deposit
date.
Although we may discharge or decrease our obligations under the indentures
as described in the two preceding paragraphs, we may not avoid, among other
things, our duty to register the transfer or exchange of any series of debt
securities, to replace any temporary, mutilated, destroyed, lost or stolen
series of debt securities or to maintain an office or agency in respect of any
series of debt securities.
Modification of the Indenture
Except as provided in the applicable prospectus supplement, each indenture
provides that we and the trustee may enter into supplemental indentures without
the consent of the holders of debt securities to:
. secure any debt securities;
. evidence the assumption by a successor corporation of our obligations
and the conversion of any debt securities into the capital stock of that
successor corporation, if the terms of those debt securities so provide;
. add covenants for the protection of the holders of debt securities;
. cure any ambiguity or correct any inconsistency in the indenture;
. establish the forms or terms of debt securities of any series; and
. evidence and provide for the acceptance of appointment by a successor
trustee.
Each indenture also provides that we and the trustee may, with the consent
of the holders of not less than a majority in aggregate principal amount of
debt securities of all series of senior debt securities or of subordinated debt
securities then outstanding and affected, voting as one class, add any
provisions to, or change in any manner, eliminate or modify in any way the
provisions of, the indenture or modify in any manner the rights of the holders
of the debt securities. We and the trustee may not, however, without the
consent of the holder of each outstanding debt security affected:
. extend the stated maturity of any debt security;
. reduce the principal amount or premium, if any;
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. reduce the rate or extend the time of payment of interest;
. reduce any amount payable on redemption;
. change the currency in which the principal, unless otherwise provided
for a series, premium, if any, or interest is payable;
. reduce the amount of the principal of any debt security issued with an
original issue discount that is payable upon acceleration or provable in
bankruptcy;
. impair the right to institute suit for the enforcement of any payment on
any debt security when due; or
. reduce the percentage of holders of debt securities of any series whose
consent is required for any modification of the indenture for any such
series.
Concerning the Trustee
Each indenture provides that there may be more than one trustee under the
indenture, each for one or more series of debt securities. If there are
different trustees for different series of debt securities, each trustee will
be a trustee of a trust under the indentures separate and apart from the trust
administered by any other trustee under the indenture. Except as otherwise
indicated in this prospectus or any prospectus supplement, any action permitted
to be taken by a trustee may be taken by that trustee only on the one or more
series of debt securities for which it is the trustee under the indenture. Any
trustee under the indentures may resign or be removed from one or more series
of debt securities. All payments of principal of, premium, if any, and interest
on, and all registration, transfer, exchange, authentication and delivery of,
the debt securities of a series will be effected by the trustee for that series
at an office designated by the trustee of that series in New York, New York.
If the trustee becomes a creditor of our company, each indenture places
limitations on the right of the trustee to obtain payment of claims or to
realize on property received in respect of any such claim as security or
otherwise. The trustee may engage in other transactions. If it acquires any
conflicting interest relating to any duties concerning the debt securities,
however, it must eliminate the conflict or resign as trustee.
The holders of a majority in aggregate principal amount of any series of
debt securities then outstanding will have the right to direct the time, method
and place of conducting any proceeding for exercising any remedy available to
the trustee concerning the applicable series of debt securities, so long as the
direction:
. would not conflict with any rule of law or with the applicable
indenture;
. would not be unduly prejudicial to the rights of another holder of the
debt securities; and
. would not involve any trustee in personal liability.
Each indenture provides that if an event of default occurs, is not cured and
is known to any trustee, the trustee must use the same degree of care as a
prudent person would use in the conduct of his or her own affairs in the
exercise of the trust's power. The trustee will be under no obligation to
exercise any of its rights or powers under the indenture at the request of any
of the holders of the debt securities, unless they have offered to the trustee
security and indemnity satisfactory to the trustee.
No Individual Liability of Incorporators, Stockholders, Officers or Directors
Each indenture provides that no incorporator and no past, present or future
stockholder, officer or director of our company or any successor corporation in
those capacities will have any individual liability for any of our obligations,
covenants or agreements under the debt securities or such indenture.
Governing Law
The indentures and the debt securities will be governed by, and construed in
accordance with, the laws of the State of New York.
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DESCRIPTION OF PREFERRED STOCK
Under our certificate of incorporation we have authorized 5,000,000 shares
of preferred stock, par value $0.001 per share. At June 23, 2000, we had no
shares of preferred stock issued and outstanding. Our board of directors has
the authority to issue preferred stock in one or more classes or series and to
fix the rights, preferences, privileges and restrictions thereof, including
dividend rights, dividend rates, conversion rights, exchange rights, voting
rights, terms of redemption, redemption prices, liquidation preferences and the
number of shares constituting any class or series or the designation of such
class or series, without any further action by the stockholders. Preferred
stock, if issued, will not be entitled to any preemptive or similar rights.
Each time that we issue a new series of preferred stock, we will file with
the SEC a definitive certificate of designations. In addition, the prospectus
supplement relating to that new series of preferred stock will specify the
particular amount, price and other terms of that new series. These terms will
include:
. the designation of the title of the series;
. dividend rates;
. redemption provisions, if any;
. special or relative rights in the event of liquidation, dissolution,
distribution or winding up of Exodus;
. sinking fund provisions, if any;
. whether the preferred stock will be convertible into our common stock or
any other of our securities or exchangeable for securities of any other
person;
. voting rights; and
. any other preferences, privileges, powers, rights, qualifications,
limitations and restrictions, not inconsistent with our by-laws.
The shares of any series of preferred stock will be, when issued, fully paid
and non-assessable. The holders of the preferred stock will not have preemptive
rights.
Ranking
Each new series of preferred stock will rank with respect to each other
series of our preferred stock as specified in the prospectus supplement
relating to that new series of preferred stock.
Dividends
Holders of each new series of preferred stock will be entitled to receive
cash dividends or dividends in kind, if declared by our board of directors out
of funds legally available for dividends. For each series of preferred stock,
we will specify in the prospectus supplement:
. the dividend rates;
. whether the rates will be fixed or variable or both;
. the dates of distribution of the cash dividends; and
. whether the dividends on any series of preferred stock will be
cumulative or non-cumulative.
Conversion and exchange
The prospectus supplement for any new series of preferred stock will state
the terms and other provisions, if any, on which shares of the new series of
preferred stock are convertible into shares of our common stock or exchangeable
for securities of a third party.
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Redemption
We will specify in the prospectus supplement relating to each new series of
preferred stock:
. whether that new series will be redeemable at any time, in whole or in
part, at our option or at the option of the holder of the shares of
preferred stock;
. whether that new series will be subject to mandatory redemption under a
sinking fund or on other terms; and
. the redemption prices.
Liquidation preference
Upon our voluntary or involuntary liquidation, dissolution or winding up,
holders of each series of preferred stock will be entitled to receive:
. distributions upon liquidation in the amount provided in the prospectus
supplement of that series of preferred stock; plus
. any accrued and unpaid dividends.
These payments will be made to holders of preferred stock out of our assets
available for distribution to stockholders before any distribution is made on
any securities ranking junior to the preferred stock regarding liquidation
rights.
After payment of the full amount of the liquidation preference to which they
are entitled, the holders of each series of preferred stock will not be
entitled to any further participation in any distribution of our assets.
Voting rights
The holders of shares of any series of preferred stock will have no voting
rights except as indicated in the certificate of designations or prospectus
supplement relating to that series or as required by law.
Transfer agent and registrar
We will specify each of the transfer agent, registrar, dividend disbursing
agent and redemption agent for shares of each new series of preferred stock in
the prospectus supplement relating to that series.
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DESCRIPTION OF COMMON STOCK
The following summary is a description of the material terms of our common
stock, does not purport to be complete and is subject in all respects to the
applicable provisions of Delaware law and of our constituent documents and of
the constituent documents of our subsidiaries. Our restated certificate of
incorporation and bylaws are incorporated by reference as exhibits to the
registration statement of which this prospectus is a part.
General
Our restated certificate of incorporation provides that we have authority to
issue 1,500,000,000 shares of common stock, par value $0.001 per share. As of
June 23, 2000, there were 414,703,202 shares of common stock outstanding.
Common stockholders are entitled to one vote for each share held on all matters
submitted to a vote of stockholders. They do not have cumulative voting rights.
Common stockholders do not have preemptive, subscription, redemption or
conversion rights. The outstanding shares of common stock are fully paid and
nonassessable. The rights, preferences and privileges of common stockholders
are subject to the rights of the shareholders of any series of preferred stock
which we may designate and issue in the future. We will describe the specific
terms of any common stock we may offer in a prospectus supplement.
Charter Provisions
The board of directors currently consists of ten members. At each annual
meeting of stockholders, directors are elected for a term of one year.
Our restated certificate of incorporation includes provisions eliminating
the personal liability of our directors for monetary damages resulting from
breaches of their fiduciary duty to the extent permitted by law. Our bylaws
include provisions indemnifying our directors and officers to the fullest
extent permitted by Delaware law, including under circumstances in which
indemnification is otherwise discretionary, and permitting the board of
directors to grant indemnification to employees and agents to the fullest
extent permitted by Delaware law.
Our bylaws require that nominations for the board of directors made by the
stockholders and proposals by stockholders seeking to have any business
conducted at a stockholders' meeting comply with particular notice procedures.
A notice by a stockholder of a planned nomination or of proposed business must
generally be given not later than 60 days nor earlier than 90 days prior to the
date of the meeting. A stockholder's notice of nomination must include
particular information about the stockholder, the nominee and any beneficial
owner on whose behalf the nomination is made, and a notice from a stockholder
proposing business to be brought before the meeting must describe such business
and include information about the stockholder making the proposal, any
beneficial owner on whose behalf the proposal is made, and any other
stockholder known to be supporting that proposal.
Our restated certificate of incorporation and bylaws provide that any action
required or permitted to be taken by the stockholders shall be taken only at a
duly called annual or special meeting of the stockholders. Special meetings may
be called by the board of directors, the chairman of the board, the chief
executive officer or the holders of Exodus shares that are entitled to cast not
less then 10% of the total number of votes entitled to be cast by all
stockholders at such meeting. In addition, our restated certificate of
incorporation and bylaws provide that the board of directors may, from time to
time, fix the number of directors constituting the board of directors, and only
the directors are permitted to fill vacancies on the board of directors.
Under Delaware law, the affirmative vote of a majority of the shares
entitled to vote on any mater is required to amend a corporation's certificate
of incorporation or bylaws, unless a corporation's certificate of incorporation
or bylaws, as the case may be, requires a greater percentage. Our restated
certificate of incorporation and bylaws do not require a greater percentage. In
addition, our restated certificate of
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incorporation and bylaws provide that the board of directors shall have the
power to amend or repeal our bylaws.
The provisions of the restated certificate of incorporation and bylaws
discussed above could make more difficult or discourage a proxy contest or the
acquisition of control of a substantial block of our stock or the removal of
any incumbent member of the board of directors. Such provisions could also have
the effect of discouraging a third party from making a tender offer or
otherwise attempting to obtain control of Exodus, even though such an attempt
might be beneficial to Exodus and our stockholders.
Stockholder Rights Plan
We adopted a stockholder rights plan on January 26, 1999. The plan was
implemented by declaring a dividend, distributable to stockholders of record on
February 11, 1999, of one preferred share purchase right for each outstanding
share of common stock. The plan provides that each share of common stock
outstanding will have attached to it the right to purchase one sixteen-
hundredth of a share of preferred stock. The purchase price per one sixteen-
hundredth of a preferred share under the plan is $21.87, subject to adjustment.
The rights will be exercisable only if a person or group (i) acquires 15% or
more of the common stock or (ii) announces a tender offer that would result in
that person or group acquiring 15% or more of the common stock. Once
exercisable, and in some circumstances if certain additional conditions are
met, the plan allows shareholders (other than the acquiror) to purchase common
stock or securities of the acquiror having a then-current market value of two
times the exercise price of the right. The rights are redeemable for $0.001 per
right (subject to adjustment) at the option of the board of directors. Until a
right is exercised, the holder of the right, as such, has no rights as a
stockholder of Exodus. The rights will expire on January 27, 2009 unless
redeemed by Exodus prior to that date.
On October 20, 1999 the rights agreement was amended to provide that FMR
Corp. will not be deemed an "acquiring person" unless it acquires 20% or more
of the common stock as opposed to 15% as described above.
The rights agreement contains rights that have anti-takeover effects. The
rights will cause substantial dilution to a person or group that attempts to
acquire Exodus 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 Exodus at $0.001 per
right prior to the earlier of (i) the time prior to such time as any person has
become an acquiring person (as defined in the rights agreement), or
(ii) January 27, 2009.
Change of Control
We are subject to Section 203 of the Delaware General Corporation Law which
under certain circumstances, may make it more difficult for a person who would
be an "Interested Stockholder," as defined in Section 203, to effect various
business combinations with us for a three-year period. Under Delaware law, a
corporation's certificate of incorporation or bylaws may exclude a corporation
from the restrictions imposed by Section 203. Our restated certificate of
incorporation and bylaws do not exclude us from the restrictions imposed under
Section 203.
Transfer Agent
The transfer agent, registrar, dividend disbursing agent and redemption
agent for the shares of our common stock will be EquiServe.
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DESCRIPTION OF WARRANTS
We may issue warrants, including debt warrants, which are warrants to
purchase debt securities, and equity warrants, which are warrants to purchase
common stock or preferred stock.
Each series of warrants will be issued under a separate warrant agreement to
be entered into between us and a warrant agent. The warrant agent will act
solely as our agent in connection with a series of warrants and will not assume
any obligation or relationship of agency for or with holders or beneficial
owners of warrants. The following describes the general terms and provisions of
the warrants offered by this prospectus. The applicable prospectus supplement
will describe any other terms of the warrant and the applicable warrant
agreement.
Debt warrants
The applicable prospectus supplement will describe the terms of any debt
warrants, including the following:
. the title and aggregate number of the debt warrants;
. any offering price of the debt warrants;
. the number of debt warrants and debt securities that will be separately
transferable;
. any date on and after which the debt warrants and debt securities will
be separately transferable;
. the title, total principal amount, ranking and terms, including
subordination and conversion provisions, of the underlying debt
securities that may be purchased upon exercise of the debt warrants;
. the time or period when the debt warrants are exercisable, the minimum
or maximum amount of debt warrants which may be exercised at any one
time and the final date on which the debt warrants may be exercised;
. the principal amount of underlying debt securities that may be purchased
upon exercise of each debt warrant and the price, or the manner of
determining the price, at which the principal amount may be purchased
upon exercise;
. the terms of any right to redeem or call the debt warrants;
. any book-entry procedure information;
. any currency or currency units in which the offering price and the
exercise price are payable; and
. any other terms of the debt warrants not inconsistent with the
provisions of the debt warrant agreement.
Equity warrants
The applicable prospectus supplement will describe the terms of any equity
warrants, including the following:
. the title and aggregate number of the equity warrants;
. any offering price of the equity warrants;
. the designation and terms of any shares of preferred stock that are
purchasable upon exercise of the equity warrants;
. if applicable, the designation and terms of the securities with which
the equity warrants are issued and the number of the equity warrants
issued with each security;
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. if applicable, the date from and after which the equity warrants and any
securities issued with those warrants will be separately transferable;
. the number of shares of common stock or preferred stock purchasable upon
exercise of an equity warrant and the price;
. the time or period when the equity warrants are exercisable and the
final date on which the equity warrants may be exercised and terms
regarding any of our rights to accelerate this final date;
. if applicable, the minimum or maximum amount of the equity warrants
exercisable at any one time;
. any currency or currency units in which the offering price and the
exercise price are payable;
. any applicable anti-dilution provisions of the equity warrants;
. any applicable redemption or call provisions; and
. any additional terms of the equity warrants not inconsistent with the
provisions of the equity warrant agreement.
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PLAN OF DISTRIBUTION
We may sell our debt securities, shares of preferred stock, shares of common
stock and warrants in any of three ways:
. through underwriters;
. through agents; or
. directly to a limited number of institutional purchasers or to a single
purchaser.
The prospectus supplement for the securities we sell will describe that
offering, including:
. the name or names of any underwriters;
. the purchase price and the proceeds to us or the selling stockholders
from that sale;
. any underwriting discounts and other items constituting underwriters'
compensation;
. any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers; and
. whether the securities will trade on any securities exchanges or the
Nasdaq National Market.
Underwriters
If underwriters are used in the sale, we will execute an underwriting
agreement with those underwriters relating to the securities that we will
offer. Unless otherwise provided in the applicable prospectus supplement, the
obligations of the underwriters to purchase these securities will be subject to
conditions. The underwriters will be obligated to purchase all of these
securities if any are purchased.
The securities subject to the underwriting agreement will be acquired by the
underwriters for their own account and may be resold by them from time to time
in one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale.
Underwriters may be deemed to have received compensation from us in the form of
underwriting discounts or commissions and may also receive commissions from the
purchasers of these securities for whom they may act as agent. Underwriters may
sell these securities to or through dealers. These dealers may receive
compensation in the form of discounts, concessions or commissions from the
underwriters and/or commissions from the purchasers for whom they may act as
agent. Any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time to time.
We also may sell the securities in connection with a remarketing upon their
purchase, in connection with a redemption or repayment, by a remarketing firm
acting as principal for its own account or as our agent. Remarketing firms may
be deemed to be underwriters in connection with the securities that they
remarket.
We may authorize underwriters to solicit offers by institutions to purchase
the securities subject to the underwriting agreement from us at the public
offering price stated in the prospectus supplement under delayed delivery
contracts providing for payment and delivery on a specified date in the future.
If we sell securities under these delayed delivery contracts, the prospectus
supplement will state that as well as the conditions to which these delayed
delivery contracts will be subject and the commissions payable for that
solicitation.
Agents
We may also sell any of the securities through agents designated by us from
time to time. We will name any agent involved in the offer or sale of these
securities and will list commissions payable by us to these agents in the
prospectus supplement. These agents will be acting on a best efforts basis to
solicit purchases for the period of their appointment, unless we state
otherwise in the applicable prospectus supplement.
29
<PAGE>
Direct Sales
We may sell any of the securities directly to purchasers. In this case, we
will not engage underwriters or agents in the offer and sale of these
securities.
Indemnification
We may indemnify underwriters, dealers or agents who participate in the
distribution of the securities against certain liabilities, including
liabilities under the Securities Act, and agree to contribute to payments which
these underwriters, dealers or agents may be required to make.
LEGAL MATTERS
Certain legal matters with respect to the securities will be passed upon for
us by Fenwick & West LLP, Palo Alto, California.
EXPERTS
The consolidated financial statements of Exodus as of December 31, 1998 and
1999, and for each of the years in the three-year period ended December 31,
1999 and the related financial statement schedule have been incorporated by
reference herein and in the registration statement in reliance upon the report
of KPMG LLP, independent public accountants, incorporated by reference herein,
and upon the authority of said firm as experts in accounting and auditing.
30
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
$2,000,000,000
Exodus Communications, Inc.
Debt Securities
Preferred Stock
Common Stock
Warrants
[LOGO OF EXODUS COMMUNICATIONS, INC.]
----------------
PROSPECTUS
, 2000
----------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
PART II
Item 14. Other Expenses of Issuance and Distribution.
<TABLE>
<S> <C>
SEC registration fee............................................ $ 528,000
Printing and engraving expenses................................. 150,000
Accounting fees and expenses.................................... 50,000
Legal fees and expenses......................................... 150,000
Miscellaneous................................................... 72,000
---------
Total......................................................... $ 950,000
</TABLE>
The foregoing items, except for the registration fee to the Securities and
Exchange Commission, are estimated. All expenses of the offering, other than
selling discounts, commissions and legal fees incurred by securityholders, will
be paid by the Registrant.
Item 15. Indemnification of Directors and Officers.
As permitted by Section 145 of the Delaware General Corporation Law, the
Registrant's Restated Certificate of Incorporation includes a provision that
eliminates the personal liability of its directors to the Registrant or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the director's duty of loyalty to
the corporation or its stockholders, (ii) for acts or omissions not in good
faith or that involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of the Delaware General Corporation Law or (iv) for any
transaction from which the director derived an improper personal benefit. In
addition, as permitted by Section 145 of the Delaware General Corporation Law,
the Bylaws of the Registrant provide that: (i) the Registrant is required to
indemnify its directors and executive officers to the fullest extent permitted
by the Delaware General Corporation Law; (ii) the Registrant may, in its
discretion, indemnify other officers, employees and agents as set forth in the
Delaware General Corporation Law; (iii) upon receipt of an undertaking to repay
such advances if indemnification is determined to be unavailable, the
Registrant is required to advance expenses, as incurred, to its directors and
executive officers to the fullest extent permitted by the Delaware General
Corporation Law in connection with a proceeding (except is a determination is
reasonably and promptly made by the Board of Directors by a majority vote of a
quorum consisting of directors who were not parties to the proceeding or, in
certain circumstances, by independent legal counsel in a written opinion that
the facts known to the decision-making party demonstrate clearly and
convincingly that such person acted in bad faith or in a manner that such
person did not believe to be in, or not opposed to, the best interests of the
corporation); (iv) the rights conferred in the Bylaws are not exclusive and the
Registrant is authorized to enter into indemnification agreements with its
directors, officers and employees and agents; (v) the Registrant may not
retroactively amend the Bylaw provisions relating to indemnity; and (vi) to the
fullest extent permitted by the Delaware General Corporation Law, a director or
executive officer will be deemed to have 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 Registrant and, with respect to any criminal action or proceeding, to have
had no reasonable cause to believe that his or her conduct was unlawful if his
or her action is based on the records or books of account of the corporation or
on information supplied to him or her by officers of the corporation in the
course of their duties or on the advice of legal counsel for the corporation or
on information or records given or reports made to the corporation by
independent certified public accountants or appraisers or other experts.
The Registrant's policy is to enter into indemnification agreements with
each of its directors and executive officers. The indemnification agreements
provide that directors and executive officers will be indemnified and held
harmless to the fullest possible extent permitted by law including against all
expenses (including attorneys' fees), judgments, fines and settlement amounts
paid or reasonably incurred by them in any action, suit or proceeding,
including any derivative action by or in the right of the Registrant, on
account of their services as directors, officers, employees or agents of the
Registrant or as directors, officers, employees or agents of any other company
or enterprise when they are serving in such capacities at the request of the
II-1
<PAGE>
Registrant. The Registrant will not be obligated pursuant to the agreements to
indemnify or advance expenses to an indemnified party with respect to
proceedings or claims (i) initiated or brought voluntarily by the indemnified
party and not by way of defense, except with respect to a proceeding to
establish or enforce a right to indemnification under the indemnification
agreements or any other agreement or insurance policy or under the Registrant's
Certificate of Incorporation or Bylaws now or hereafter in effect relating to
indemnification, or authorized by the Board of Directors or as otherwise
required under Delaware statute or law, regardless of whether they indemnified
party is ultimately determined to be entitled to such indemnification, (ii) for
expenses and the payment of profits arising from the purchase and sale by the
indemnified party of securities in violation of Section 16(b) of the Securities
Exchange Act of 1934 or any similar successor statute or (iii) if a final
decision by a court having jurisdiction in the matter shall determine that such
indemnification is now lawful.
The indemnification agreement also provides for contribution in certain
situations in which the Registrant and a director or executive officer are
jointly liable for which indemnification is unavailable, such contribution to
be based on the relative benefits received and the relative fault of the
Registrant and the director or executive officer. No contribution is allowed to
a person found guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act of 1933, as amended) from any person who
was not found guilty of such fraudulent misrepresentation.
The indemnification agreement requires a director or executive officer to
reimburse the Registrant for all expenses advanced only to the extent it is
ultimately determined that the director or executive officer is not entitled,
under Delaware law, the Bylaws, the indemnification agreement or otherwise, to
be indemnified for such expenses. The indemnification agreement provides that
it is not exclusive of any rights a director or executive officer may have
under the Certificate of Incorporation, Bylaws, other agreements, any majority-
in-interest vote of the stockholders or vote of disinterested directors,
Delaware law or otherwise.
The indemnification provision in the Bylaws, and the form of indemnification
agreements entered into between the Registrant and its directors and executive
officers, may be sufficiently broad to permit indemnification of the
Registrant's executive officers and directors for liabilities arising under the
Securities Act of 1933, as amended.
As authorized by the Registrant's Bylaws, the Registrant, with approval by
the Board, maintains director and officer liability insurance.
In addition, Thadeus Mocarski, a director of the Registrant, is indemnified
in certain circumstances by Fleet Financial Group, Inc.
The following is a complete list of Exhibits filed as part of this
Registration Statement, which are incorporated herein:
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Description
------- -------------------
<C> <S>
1.01 Form of Underwriting Agreement for [Common Stock] [Preferred Stock].*
1.02 Form of Underwriting Agreement for [Convertible] [Senior]
[Subordinated] Debt Securities.*
4.01 Restated Certificate of Incorporation of the Registrant (filed as
Exhibit 4.01 to the Registrant's Registration Statement on Form S-8,
filed with the Securities and Exchange Commission on June 9, 2000, and
incorporated by reference herein).
4.02 Bylaws of the Registrant (filed as Exhibit 3.06 to Amendment No. 1 to
the Registrant's Registration Statement on Form S-1, filed with the
Securities and Exchange Commission on June 9, 2000, and incorporated
by reference herein).
4.03 Rights Agreement dated as of January 27, 1999 between the Registrant
and BancBoston, N.A., Rights Agent (filed as Exhibit 4.04 to the
Registrant's Form 8-A12G/A, filed on January 29, 1999 and incorporated
by reference herein).
4.04 Amendment No. 1, dated as of October 20, 1999 to the Rights Agreement
between the Registrant and BancBoston, N.A., Rights Agent, dated as of
January 27, 1999 (filed as Exhibit 4.05 to the Registrant's Form 8-
A12G/A, filed on November 29, 1999 and incorporated by reference
herein).
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Description
------- -------------------
<C> <S>
4.05 Form of Senior Indenture.*
4.06 Form of Senior Debt Security.*
4.07 Form of Subordinated Indenture.*
4.08 Form of Subordinated Debt Security.*
4.09 Form of Standard Stock Warrant Provisions.*
4.10 Form of Standard Debt Securities Warrant Provisions.*
5.01 Opinion of Fenwick & West LLP.*
12.01 Statement Regarding Computation of Ratios.*
23.01 Consent of Fenwick & West LLP (included in Exhibit 5.01).*
23.02 Consent of KPMG LLP, independent auditors.
Power of Attorney (see the signature page to this Registration
24.01 Statement).
</TABLE>
--------
* To be filed by amendment.
Item 17. Undertakings.
(1) The undersigned 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 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act
of 1934) that is incorporated by reference in the registration statement shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at the time shall be deemed to be
the initial bona fide offering thereof.
(2) 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 Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act 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 Act and
will be governed by the final adjudication of such issue.
(3) The undersigned registrant hereby undertakes:
(a) 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 the 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 the 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
II-3
<PAGE>
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration Statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
(b) 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.
(c) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(d) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus 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.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, 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 registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Santa Clara, State of California, on this 28th day
of June, 2000.
EXODUS COMMUNICATIONS, INC.
By: /s/ R. Marshall Case
----------------------------------
R. Marshall Case
Executive Vice President, Finance
and Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS THAT each individual whose signature
appears below appoints each of Ellen M. Hancock and R. Marshall Case, and each
of them, as his or her true and lawful attorneys-in-fact and agents, with full
power of substitution, for him or her and in his or her name, place and stead,
in any and all capacities, to sign any and all amendments (including post-
effective amendments) to this Registration Statement on Form S-3 and to sign
any registration statement for the same offering covered by this Registration
Statement that is to be effective upon filing pursuant to Rule 415 promulgated
under the Securities Act of 1933 and all post-effective amendments thereto, and
to file the same, with all exhibits thereto and all other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto said attorney-in-fact and agent full power and authority to do and perform
each and every act and anything appropriate or necessary to be done, as fully
and for all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or his or her
substitute or substitutes may lawfully do or cause to be done by virtue
thereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
Principal Executive Officer:
<S> <C> <C>
/s/ Ellen M. Hancock Chairman, Chief Executive June 28, 2000
___________________________________________ Officer and Director
Ellen M. Hancock
Principal Financial Officer and
Principal Accounting Officer:
/s/ R. Marshall Case Executive Vice President, June 28, 2000
___________________________________________ Finance and Chief
R. Marshall Case Financial Officer
Additional Directors:
/s/ Mark Dubovoy Director June 28, 2000
___________________________________________
Mark Dubovoy
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
Director
___________________________________________
John R. Dougery
Director
___________________________________________
Max D. Hopper
/s/ L. William Krause Director June 28, 2000
___________________________________________
L. William Krause
/s/ Daniel C. Lynch Director June 28, 2000
___________________________________________
Daniel C. Lynch
/s/ Thadeus J. Mocarski Director June 28, 2000
___________________________________________
Thadeus J. Mocarski
/s/ Naomi O. Seligman Director June 28, 2000
___________________________________________
Naomi O. Seligman
/s/ Dirk A. Stuurop Director June 28, 2000
___________________________________________
Dirk A. Stuurop
/s/ Laura D'Andrea Tyson Director June 28, 2000
___________________________________________
Laura D'Andrea Tyson
</TABLE>
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Description
------- -------------------
<C> <S>
1.01 Form of Underwriting Agreement for [Common Stock] [Preferred Stock].*
1.02 Form of Underwriting Agreement for [Convertible] [Senior]
[Subordinated] Debt Securities.*
4.01 Restated Certificate of Incorporation of the Registrant (filed as
Exhibit 4.01 to the Registrant's Registration Statement on Form S-8,
filed with the Securities and Exchange Commission on June 9, 2000, and
incorporated by reference herein).
4.02 Bylaws of the Registrant (filed as Exhibit 3.06 to Amendment No. 1 to
the Registrant's Registration Statement on Form S-1, filed with the
Securities and Exchange Commission on June 9, 2000, and incorporated
by reference herein).
4.03 Rights Agreement dated as of January 27, 1999 between the Registrant
and BancBoston, N.A., Rights Agent (filed as Exhibit 4.04 to the
Registrant's Form 8-A12G/A, filed on January 29, 1999 and incorporated
by reference herein).
4.04 Amendment No. 1, dated as of October 20, 1999 to the Rights Agreement
between the Registrant and BancBoston, N.A., Rights Agent, dated as of
January 27, 1999 (filed as Exhibit 4.05 to the Registrant's Form 8-
A12G/A, filed on November 29, 1999 and incorporated by reference
herein).
4.05 Form of Senior Indenture.*
4.06 Form of Senior Debt Security.*
4.07 Form of Subordinated Indenture.*
4.08 Form of Subordinated Debt Security.*
4.09 Form of Standard Stock Warrant Provisions.*
4.10 Form of Standard Debt Securities Warrant Provisions.*
5.01 Opinion of Fenwick & West LLP.*
12.01 Statement Regarding Computation of Ratios.*
23.01 Consent of Fenwick & West LLP (included in Exhibit 5.01).*
23.02 Consent of KPMG LLP, independent auditors.
24.01 Power of Attorney (see the signature page to this Registration
Statement).
</TABLE>
--------
* To be filed by amendment.
