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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 5, 1999
REGISTRATION NO. 333-71463
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 4
TO
FORM S-1
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REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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DESTIA COMMUNICATIONS, INC.
(formerly Econophone, Inc.)
(Exact name of Registrant as specified in its charter)
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DELAWARE 4813 11-3132722
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of Classification Code Number) Identification
incorporation or organization) No.)
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95 RTE. 17 SOUTH
PARAMUS, NJ 07652
(201) 226-4500
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
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RICHARD L. SHORTEN, JR., ESQ.
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
DESTIA COMMUNICATIONS, INC.
95 RTE. 17 SOUTH
PARAMUS, NJ 07652
(201) 226-4500
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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PLEASE SEND COPIES TO:
MICHAEL R. LITTENBERG, ESQ. JAMES S. SCOTT, SR., ESQ.
SCHULTE ROTH & ZABEL LLP SHEARMAN & STERLING
900 THIRD AVENUE 599 LEXINGTON AVENUE
NEW YORK, NEW YORK 10022 NEW YORK, NEW YORK 10022
(212) 756-2000 (212) 848-4000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the effective date of this Registration Statement.
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, AS AMENDED, CHECK THE FOLLOWING BOX. / /
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 THIS FORM IS A POST-EFFECTIVE AMENDMENT FILED PURSUANT TO RULE 462(D)
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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PROPOSED
AMOUNT MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF TO BE OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED(1) PER UNIT OFFERING PRICE(2) REGISTRATION FEE
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Common Stock, $.01 par value per share...... $7,475,000 $11.00 $82,225,000 $22,859(3)
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(1) Includes shares of Common Stock which the Underwriters have the option to
purchase to cover over-allotments, if any.
(2) Estimated solely for the purpose of calculating the registration fee.
(3) Of this amount, $18,070 was paid on January 29, 1999 in connection with the
initial filing of the registration statement. Accordingly, the registrant
has paid the difference of $4,789 in connection with this filing.
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 THAT SPECIFICALLY STATES 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 SUCH SECTION 8(A), MAY DETERMINE.
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This Amendment No. 4 amends and supplements the Registration Statement on
Form S-1 No. 333-71463 filed with the Securities and Exchange Commission (the
"Commission") on January 29, 1999, as amended by Amendment No. 1 filed with the
Commission on February 17, 1999, Amendment No. 2 filed with the Commission on
April 16, 1999, and Amendment No. 3 filed with the Commission on May 3, 1999
(the "Registration Statement"), by Destia Communications, Inc., a Delaware
corporation (the "Company"), relating to the offering of the Company's Common
Stock. Terms not otherwise defined herein shall have the meanings ascribed to
them in the Registration Statement.
The purpose of this Amendment No. 4 is to pay an additional registration fee
and amend Item 14 herein.
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by the Company in connection
with the sale of common stock being registered. All amounts are estimates except
the SEC registration fee, the NASD filing fee and the NASDAQ National Market
listing fee in connection with the offering.
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SEC Registration fee............................................................ $ 56,219
NASD Filing fee................................................................. 8,000
NASDAQ National Market listing fee.............................................. 95,000
Printing and engraving expenses................................................. 300,000
Legal fees and expenses......................................................... 500,000
Accounting fees and expenses.................................................... 100,000
Blue sky fees and expenses...................................................... 13,000
Transfer agent fees............................................................. 3,500
Miscellaneous fees and expenses................................................. 224,281
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Total........................................................................... $1,300,000
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ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Destia's Certificate of Incorporation indemnifies its officers and directors
to the fullest extent permitted by the DGCL. Under Section 145 of the DGCL, a
corporation may indemnify its directors, officers, employees and agents and
those who serve, at the corporation's request, in such capacities with another
enterprise, against expenses (including attorneys' fees), as well as judgments,
fines and settlements in nonderivative lawsuits, actually and reasonably
incurred in connection with the defense of any action, suit or proceeding in
which they or any of them were or are made parties are threatened to be made
parties by reason of their serving or having served in such capacity. The DGCL
provides, however, that such person must have acted in good faith and in a
manner such person reasonably believed to be in (or not opposed to) the best
interests of the corporation and, in the case of a criminal action, such person
must have had no reasonable cause to be believe his or her conduct was unlawful.
In addition, the DGCL does not permit indemnification in an action or suit by or
in the right of the corporation, where such person has been adjudged liable to
the corporation, unless, and only to the extent that, a court determines that
such person fairly and reasonably is entitled to indemnity for costs the court
deems proper in light of liability adjudication. Indemnity is mandatory to the
extent a claim, issue or matter has been successfully defended. The Certificate
of Incorporation and the DGCL also prohibit limitations on officer or director
liability for acts or omissions which resulted in a violation of a statute
prohibiting certain dividend declarations, certain payments to stockholders
after dissolution and particular types of loans. The effect of these provisions
is to eliminate the rights of Destia and its stockholders (through stockholders'
derivative suits on behalf of Destia) to recover monetary damages against an
officer or director for breach of fiduciary duty as an
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officer or director (including breaches resulting from grossly negligent
behavior), except in the situations described above. These provisions will not
limit the liability of directors or officer under the federal securities laws of
the United States. The foregoing summary of Destia's Certificate of
Incorporation, as amended, is qualified in its entirety by reference to the
relevant provisions thereof (filed as Exhibit 3.1).
In addition, Destia has entered into indemnification agreements with its
directors and officers providing for, among other things, indemnification to the
extent permitted under Delaware law.
See Item 17 for a statement of the Company's undertaking as to the
Commission's position respecting indemnification arising under the Securities
Act.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
Since January 1, 1996, the Company has issued and sold the following
securities:
1. On November 1, 1996, the Company sold Princes Gate Investors II, L.P.
140,000 shares of Series A Preferred Stock with an aggregate liquidation
preference of $14.0 million for an aggregate purchase price of $13.44 million.
This sale was privately negotiated and did not involve a public offering and was
exempt from registration under the Securities Act in reliance on Section 4(2) of
such Act.
2. On April 24, 1997, the Company entered into a Note Purchase Agreement
pursuant to which Morgan Stanley Group purchased an aggregate amount of $7.0
million of Bridge Notes. Morgan Stanley Group acted as placement agent in this
transaction and received approximately $400,000 in fees and expenses in
connection with the transaction. This sale was privately negotiated and did not
involve a public offering and was exempt from registration under the Securities
Act in reliance on Section 4(2) of such Act.
3. On July 1, 1997, the Company sold $155.0 million of 13 1/2% Senior Notes
due 2007 and warrants to purchase 1,315,148 shares of voting common stock. This
issuance was underwritten by Morgan Stanley & Co. Incorporated who acted as
placement agent for this transaction and received fees of $5.425 million. All of
the Units were initially purchased by Morgan Stanley & Co. Incorporated pursuant
to Section 4(2) of the Securities Act and resold to "qualified institutional
buyers" pursuant to Rule 144A thereunder.
4. On February 18, 1998, the Company sold $300.0 million aggregate principal
amount at maturity of 11% Senior Discount Notes due 2008. This issuance was
underwritten by Morgan Stanley & Co. Incorporated who also received fees of
$6.152 million. All of such Notes were initially purchased by Morgan Stanley &
Co. Incorporated pursuant to Section 4(2) of the Securities Act and resold to
"qualified institutional buyers" pursuant to Rule 144A thereunder.
5. On July 14, 1998, the Company acquired the 30% minority interest in Telco
Global Communications Limited from Gold Valley Limited for a cash payment of
$13.75 million. The acquisition also included the rollover of employee options
in Telco into the Company's restricted Share awards. Approximately 145,448
restricted shares will be awarded as a result of the rollover. This transaction
was privately negotiated, did not involve a public offering and was exempt from
registration under the Securities Act in reliance on Section 4(2) of such Act.
6. On March 30, 1999, the Company acquired Ms. Sonja Gross' 28% interest in
Econophone Services GmbH, the Company's Swiss subsidiary. In exchange, Ms. Gross
received 103,891 restricted shares of the Company's common stock. This
transaction was privately negotiated, did not involve a public offering and was
exempt from registration under the Securities Act in reliance on Section 4(2) of
such Act.
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ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits.
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EXHIBIT
NUMBER DESCRIPTION
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1.1* Form of Underwriting Agreement.
3.1* Amended and Restated Certificate of Incorporation.
3.2* Amended and Restated Bylaws.
3.3 Certificate of Name Change from Econophone, Inc. to Destia Communications, Inc. (incorporated by
reference to Form 10-K filed by the Company for the year ended December 31, 1998).
3.4* Certificate of Designation
4.1** Specimen of Destia Communications, Inc.'s 11% Senior Discount Note due 2008.
4.2** Indenture, dated as of February 18, 1998, between Destia Communications, Inc. and The Bank of New
York, as Trustee.
4.3** Specimen of Destia Communications, Inc.'s 13 1/2% Senior Note due 2007.
4.4** Indenture, dated as of July 1, 1997, between Destia Communications, Inc. and The Bank of New York,
as Trustee.
4.5* Specimen of Common Stock certificate.
5.1* Opinion of Schulte Roth & Zabel LLP regarding legality.
8.1 Opinion of Schulte Roth & Zabel LLP regarding tax matters (contained in Exhibit 5.1).
10.1*** Securityholders Agreement, dated as of November 1, 1996, between Alfred West, Destia Communications,
Inc. and Princes Gate Investors II, L.P.
10.2*** Securities Purchase Agreement, dated as of November 1, 1996, between Destia Communications, Inc. and
Princes Gate Investors II, L.P.
10.3*** Note Purchase Agreement, dated as of April 24, 1997, between Destia Communications, Inc. and Morgan
Stanley Group Inc.
10.4*** Form of Note under Note Purchase Agreement.
10.5** Second Amended and Restated Equipment Loan and Security Agreement, dated as of January 28, 1998,
between Destia Communications, Inc. and NTFC Capital Corporation.
10.6** Stock Purchase Agreement, dated January 28, 1998, between Destia Communications, Inc. and the
shareholders of Voicenet Corporation.
10.7 Amendment, dated April 16, 1998, to Stock Purchase Agreement between Destia Communications, Inc. and
the shareholders of Voice Net Corporation (incorporated by reference to Form 10-K filed by the
Company for the year ended December 31, 1998).
10.8* Employment Agreement, dated as of May 3, 1999, between Destia Communications, Inc. and Alan Levy.
10.9* Employment Agreement, dated as of May 3, 1999, between Destia Communications, Inc. and Alfred West.
10.10 Employment Agreement, dated February 2, 1998, between Destia Communications, Inc. and Phillip J.
Storin (incorporated by reference to Form 10-K filed by the Company for the year ended December 31,
1998).
10.11**** Employment Agreement, dated February 2, 1998, between Destia Communications, Inc. and Kevin Alward.
10.12* Employment Agreement, dated January 1, 1999, between Destia Communications, Inc. and Richard L.
Shorten, Jr.
10.13*** Amended and Restated Destia Communications, Inc. 1996 Flexible Incentive Plan.
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EXHIBIT
NUMBER DESCRIPTION
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10.14 Amendment to 1996 Flexible Incentive Plan (incorporated by reference to Form 10-K filed by the
Company for the year ended December 31, 1998).
10.15 Stock Purchase Agreement, dated July 17, 1998, between Destia Communications, Inc. and certain
shareholders of Telco Global Communications (incorporated by reference to
Form 10-K filed by the Company for the year ended December 31, 1998).
10.16***** Telecommunications Services Agreement between Frontier Communications of the West, Inc. and Destia
Communications, Inc., dated November 17, 1998.
10.17* 1999 Flexible Incentive Plan.
10.18* Second Amendment to 1996 Flexible Incentive Plan.
10.19* Modification Agreement No. 1 dated as of March 31, 1999 to the Second Amended and Restated Equipment
Loan and Security Agreement between Destia Communications, Inc. and NTFC Capital Corporation.
10.20* Form of Indemnification Agreement with directors and officers
21.1 Subsidiaries of Destia Communications, Inc. (incorporated by reference to Form 10-K filed by the
Company for the year ended December 31, 1998).
23.1* Consent of Arthur Andersen LLP.
23.2 Consent of Schulte Roth & Zabel LLP (contained in Exhibit 5.1).
27.1**** Financial Data Schedule.
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* Previously filed as an exhibit to Amendment No. 3 to the Registration
Statement on Form S-1, Commission File Number 333-71463 and hereby
incorporated herein by reference.
** Previously filed as exhibits to Registration Statement on Form S-4,
Commission file number 333-47711, and hereby incorporated herein by
reference.
*** Previously filed as exhibits to Registration Statement on Form S-4,
Commission file number 333-33117, and hereby incorporated herein by
reference.
****Previously filed as an exhibit to Amendment No. 2 to the Registration
Statement on Form S-1, Commission File Number 333-71463 and hereby
incorporated herein by reference.
*****Previously filed as an exhibit to the Inital Registration Statement on Form
S-1, Commission File number 333-71463 and hereby incorporated herein by
reference. Portions of the exhibit have been omitted pursuant to a request
for confidential treatment.
(b) Financial Statement Schedule
Schedule II--Schedule of Valuation and Qualifying Accounts (included
at page S-1)
ITEM 17. UNDERTAKINGS
A. The undersigned registrant hereby undertakes:
(1) 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 deviation from the low or
high 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
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the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(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.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment 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.
B. 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 Securities 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 or 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 Securities Act and will be governed by the final
adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the Borough of Paramus, New Jersey on
the 5th day of May, 1999.
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DESTIA COMMUNICATIONS, INC.
By: /s/ PHILLIP J. STORIN
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Name: Phillip J. Storin
Title: Chief Financial Officer, Senior
Vice President and Treasurer (Principal
Financial and Accounting Officer)
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Pursuant to the requirements of the Securities Act of 1933, the Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
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SIGNATURE TITLE DATE
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Chief Executive Officer
and
* Chairman of the Board of
- ------------------------------ Directors
Alfred West (Principal Executive
Officer)
*
- ------------------------------ President, Chief Operating
Alan L. Levy Officer and Director
*
- ------------------------------ Director
Gary S. Bondi
*
- ------------------------------ Director
Steven West
*
- ------------------------------ Director
Stephen Munger
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*By: /s/ RICHARD L. SHORTEN, JR.
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Richard L. Shorten, Jr., May 5, 1999
Attorney-in-fact
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Original powers of attorney authorizing Alan L. Levy, Richard L. Shorten and
Alfred West and each of them to sign this amendment on behalf of the directors
and officers of the Registrant indicated above are held by the Registrant and
available for examination pursuant to Rule 302(b) of Regulation S-T.
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