<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT
OF 1934
[X] Filed by the Registrant
[ ] Filed by Party other than the Registrant
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
[ ] Confidential, for use of the Commission only (as permitted by Rule
14a-6(e)(2))
EUROTELECOM COMMUNICATIONS, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies: N/A.
2) Aggregate number of securities to which transaction applies: N/A.
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee
is calculated and state how it was determined): N/A.
4) Proposed maximum aggregate value of transaction: N/A.
5) Total fee paid: N/A.
[ ] Fee paid previously with preliminary materials: N/A
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
1) Amount previously paid: $0.00
2) Form, Schedule or Registration Statement No.: N/A
3) Filing Party: N/A
4) Date Filed: N/A
<PAGE>
[EuroTelecom logo]
Farfield Park
Wath Upon Dearne
South Yorkshire
England S63 5BD
September [ ], 2000
Dear Shareholder:
Shareholders of record as of [ ], 2000 are encouraged to vote on the enclosed
proposal, which amends the Company's Certificate of Incorporation to grant a
right to holders of the Company's Common Stock to convert such shares into an
equal number of shares of the Company's Class A Common Stock.
The Board of Directors has approved this amendment, subject to shareholder
approval. Management encourages a vote FOR this proposal.
I urge you to sign, date and promptly return the enclosed proxy in the enclosed
postage-paid envelope.
To obtain shareholder approval to this proposal, the Company will hold a special
meeting of shareholders of EuroTelecom Communications, Inc. on [ ], 2000 at the
Company's offices at Farfield Park, Wath Upon Dearne, South Yorkshire in the
United Kingdom, at 10am local time. Please note that the only item on the agenda
for this meeting will be voting on this amendment. This will be a brief,
business-only meeting, with no other matters to be discussed.
Other than matters directly relating to the proposed share conversion, the
management of the Company will be making no presentations at the special
meeting.
If you decide to attend this special meeting and vote in person, you will of
course have that opportunity.
On behalf of the Board of Directors, I would like to express our appreciation
for your continued interest in the affairs of the Company.
Sincerely,
/s/ Philip Derry
President
<PAGE>
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD [ ], 2000
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders
of EuroTelecom Communications, Inc. (the "Company") will be held at Farfield
Park, Wath Upon Dearne, South Yorkshire, England S63 5BD on [ ], 2000, at 10am
local time to consider the following:
1. The approval of certain amendments to the Company's
Certificate of Incorporation which shall provide a right to holders of the
Company's Common Stock to convert such shares into an equal number of shares of
the Company's Class A Common Stock.
2. To transact such other business as may properly come before
the meeting.
The Board of Directors has fixed the close of business on [ ], 2000 as
the record date for the Special Meeting. Only stockholders of record of the
Company's Common Stock or Class A Common Stock at the close of business on such
date will be entitled to notice of and to vote at the Special Meeting or any
adjournments or postponements thereof. Shares can be voted at the Special
Meeting only if the holder is present or represented by proxy.
The accompanying form of proxy card is solicited by the Board
of Directors of the Company. Reference is made to the attached proxy statement
for further information with respect to the business to be transacted at the
Special Meeting.
Stockholders are cordially invited to attend the Special
Meeting. Whether or not you expect to attend the Special Meeting in person,
please complete, date and sign the accompanying proxy and return it without
delay in the enclosed postage prepaid envelope. Your proxy will not be used if
you are present and prefer to vote in person or if you revoke the proxy.
By Order of the Board of Directors
GRAHAM FORD
SECRETARY
September [ ], 2000
IMPORTANT
WHETHER OR NOT YOU EXPECT TO ATTEND IN PERSON, WE URGE YOU TO SIGN, DATE, AND
RETURN THE ENCLOSED PROXY AT YOUR EARLIEST CONVENIENCE. THIS WILL ENSURE THE
PRESENCE OF A QUORUM AT THE MEETING. PROMPTLY SIGNING, DATING AND RETURNING THE
PROXY WILL SAVE THE COMPANY THE EXPENSES AND EXTRA WORK OF ADDITIONAL
SOLICITATION. AN ADDRESSED ENVELOPE, FOR WHICH NO POSTAGE IS REQUIRED IF
RETURNED FROM THE U.S. OR THE U.K., IS ENCLOSED FOR THAT PURPOSE. SENDING IN
YOUR PROXY WILL NOT PREVENT YOU FROM VOTING YOUR STOCK AT THE MEETING IF YOU
DESIRE TO DO SO, AS YOUR PROXY IS REVOCABLE AT YOUR OPTION.
<PAGE>
EUROTELECOM COMMUNICATIONS, INC.
Farfield Park
Wath Upon Dearne
South Yorkshire
S63 5DB
England
011-44-1709-874600
PROXY STATEMENT
FOR SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD [ ], 2000
The enclosed proxy card ("Proxy") is solicited by the Board of Directors (the
"Board") of EuroTelecom Communications, Inc. (the "Company") in connection with
a special meeting of stockholders of the Company to be held at Farfield Park,
Wath Upon Dearne, South Yorkshire, England S63 5DB, on [ ], 2000 at 10am local
time, and at any and all adjournments thereof (the "Special Meeting") to seek
stockholder approval to the adoption of certain amendments to the Company's
Certificate of Incorporation. By completing and returning the enclosed Proxy you
may vote as to the proposals described in this Proxy Statement. This Proxy
Statement, the accompanying Notice of Special Meeting and Proxy are being mailed
to stockholders on or about [ ], 2000.
RECORD DATE AND VOTING SECURITIES
Stockholders of record as of the close of business on [ ], 2000 (the "Record
Date") are the only persons entitled to vote at the Special Meeting. As of the
date hereof, there were issued and outstanding 17,946,222 shares of the
Company's Common Stock, par value $.01 per share (the "Common Stock") and
12,075,118 shares of the Company's Class A Common Stock ("Class A Stock")
(Common Stock and Class A Stock together, which have identical voting rights,
are referred to in this Proxy Statement as "Shares"). The Shares, in aggregate
30,021,340, are the only securities outstanding of the Company entitled to vote
at the Special Meeting.
<PAGE>
Each Share outstanding entitles the holder thereof to one vote. The Delaware
General Corporation Law requires the approval of stockholders who hold a
majority of the outstanding Shares of the Company and who are entitled to vote
to amend the Company's Certificate of Incorporation. The presence, in person or
by Proxy, of the holders of a third of the outstanding Shares entitled to vote
at the Special Meeting will constitute a quorum for the Special Meeting.
Abstentions and broker non-votes (i.e. Shares represented at the Special Meeting
by Proxies held by brokers or nominees as to which (i) instructions have not
been received from the beneficial owners or persons entitled to vote and (ii)
the broker or nominee does not have discretionary voting power on a particular
voting matter) with respect to any proposal are counted as Shares represented
and voted at the Special Meeting only for the purpose of determining the number
of Shares required to approve the proposal.
Any stockholder giving a Proxy will have the right to revoke it at any time
prior to its exercise by giving written notice of revocation to the Company's
principal executive offices, Attention: Secretary, by filing a new written
appointment of a proxy with an officer of the Company or by voting in person at
the Special Meeting. Attendance at the Special Meeting will not automatically
revoke the proxy. The mailing address of the Company's principal executive
offices is Farfield Park, Wath Upon Dearne, South Yorkshire, England S63 5BD.
The Delaware General Corporation Law does not provide any dissenters' rights
with respect to amendment of the Company's Certificate of Incorporation as set
forth above. Therefore, no dissenter's rights of appraisal will be given in
connection with these matters.
PROPOSAL TO AMEND THE COMPANY'S
CERTIFICATE OF INCORPORATION TO GIVE COMMON STOCKHOLDERS
THE RIGHT TO CONVERT TO SHARES OF CLASS A STOCK
The Board of Directors of the Company has approved submission to the
stockholders of a proposed amendment to the Company's Certificate of
Incorporation (see exhibit to this Proxy Statement for details) which would give
to all holders of Common Stock the right to convert such shares into a like
number of shares of Class A Stock.
BOARD RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL. It is intended that
shares represented by the enclosed Proxy will be voted in favor of such
amendment to the Certificate of Incorporation unless otherwise specified in such
Proxy (and except for abstentions and broker non-votes as described above). To
give effect to this amendment, the affirmative vote of holders of a majority of
the outstanding Shares entitled to vote is required at the Special Meeting. The
Directors, who between them hold 3,020,460 shares of Common Stock and 1,139,000
shares of Class A Stock, representing in aggregate 13.86 percent of the
Company's outstanding share capital, intend to vote for this proposal.
<PAGE>
The significance of this amendment to the Certificate of Incorporation is as
follows:
CURRENT RELATIONSHIP OF COMMON STOCK TO CLASS A STOCK
The Company is currently authorized to issue 50,000,000 shares of Common Stock,
50,000,000 shares of Class A Stock and 10,000,000 shares of Preferred Stock,
each having a par value of $0.01 per share. There are currently outstanding
17,946,222 shares of Common Stock, 12,075,118 shares of Class A Stock and no
shares of Preferred Stock. The Common Stock and the Class A Stock rank equally
in all respects except that the Class A Stock is subject to certain important
sale and transfer restrictions under the Company's Certificate of Incorporation.
The restrictions under the Company's Certificate of Incorporation relating to
the Class A Stock provide, among other matters, for permanent restrictions on
their transfer or offer in the US or to US persons, as defined therein, except
that such offer or transfer shall not be deemed to include the limited
circumstances where, broadly, such offer or transfer (i) is made by the Company;
(ii) is in connection with a merger or consolidation of the Company; (iii) is
due to a conversion of the Company's securities; or (iv) follows a tender or
exchange offer made to all holders of Class A Stock. In the event that Class A
Stock is offered or transferred in contravention of the above described transfer
restrictions, the Company has the option to redeem such shares from the person
who received such shares in the prohibited transaction. No rights have yet been
created for the Preferred Stock.
Sales of Shares in the two classes of the Company's securities which are
currently outstanding (namely the Common Stock and the Class A Stock)
principally occur as follows:
Sales of the Company's Common Stock are currently reported in the US in the
"Pink Sheets" operated by the National Quotation Bureau, LLC. Subject to the
approval by the SEC of the Company's registration statement (Form 10-SB), the
Common Stock will be eligible for quotation on the OTCBB, the
over-the-counter-bulletin-board operated by the National Association of
Securities Dealers, Inc. The Company has filed a Form 10-SB and amendments to it
but the Company's Common Stock will not be eligible for quotation on the OTCBB
until such time, if ever, as the SEC formally "accepts" the Company's Form 10-SB
as being fully compliant with all relevant securities laws and rules. As at the
date of this Proxy Statement, such approval has not yet been obtained. The
Company intends to proceed with its submission and endeavor to make such
additional amendments to its Form 10-SB as may be required to obtain such SEC
approval. The OTCBB quotation (if and when obtained) is intended to facilitate
bargains made in the Company's Common Stock only. Only that class of the
Company's securities is registered with the SEC.
<PAGE>
The Company's Class A Stock and Common Stock are both listed and traded on the
Alternative Investment Market, a regulated investment exchange governed by the
London Stock Exchange in the United Kingdom. Trading in the Class A Stock and
Common Stock on that stock exchange commenced on April 5, 2000. The background
to and the reasons for the Company's seeking a listing for the Class A Stock in
the United Kingdom were set out in the Company's Definitive Information
Statement (Form 14C) dated February 7, 2000. The principal reason for such
listing was to provide the option to the Company of offering additional shares
of its capital stock in the United Kingdom to facilitate the raising of further
capital or as consideration for acquisitions. The offering by the Company of
Class A Stock in the United Kingdom was made in reliance on Regulation S of the
Securities Act 1933 which, broadly, covers offshore offerings to non-US persons,
as defined in such Regulation. Such shares are not registered under the
Securities Act. The Regulation S restrictions on such shares, which prevent them
from being sold to any US person or sold in any transaction that does not
constitute an offshore transaction (i.e. outside the US), have been in
substantial part incorporated as permanent restrictions in the Company's
Certificate of Incorporation, pursuant to the Certificate of Designations
describing the terms of the Class A Stock. This was done to facilitate trading
of the Class A Stock on the Alternative Investment Market by having one
over-riding set of restrictions on the Class A Stock, which would be applicable
to the initial and any subsequent offerings of Class A Stock in the United
Kingdom made in reliance on Regulation S. The Class A Stock is therefore
restricted from ever being sold in the US or to a US person, except under the
limited circumstances described above.
PRINCIPAL REASONS FOR, AND POSSIBLE EFFECTS OF, AMENDING THE CERTIFICATE OF
INCORPORATION TO PROVIDE THE RIGHT TO HOLDERS OF COMMON STOCK TO CONVERT SUCH
SHARES TO CLASS A STOCK
The proposed amendment to the Company's Certificate of Incorporation will allow,
but not require, holders of Common Stock to convert such shares, at their
option, into an equivalent number of shares of Class A Stock. Assuming the
proposal is adopted, the right of holders of Common Stock to convert will apply
at any time during the period between the date of the Special Meeting described
herein, being [ ], 2000, and ending on [two months from date of special
meeting], 2000, and thereafter specifically on the following dates only: March
1, June 1, September 1 and December 1 in the calendar years 2001 and 2002. The
right to convert will end on December 1, 2002. By placing this right to convert
into the Company's Certificate of Incorporation, holders of Common Stock will be
given the ability, through conversion, to access a different market, the
Alternative Investment Market ("AIM") in London, where they will have the right,
subject to compliance with applicable United States securities laws and the
Company's Certificate of Incorporation, to sell their shares once converted into
Class A Stock. Although the Common Stock also is currently listed on AIM, very
few shares are traded there, and such listing does not now provide the same
liquidity as is afforded shares of Class A Stock. While the Company will
endeavor to continue to list the Class A Stock on the AIM for the foreseeable
future, there can be no assurance that such listing will continue and the
Company is not obligating itself to continue such listing. It is possible that,
if a substantial number of shares of Common Stock is converted into shares of
Class A Stock, there could be an adverse effect on the liquidity of the
remaining Common Stock held in the U.S.
<PAGE>
PRINCIPAL DIFFERENCES BETWEEN CURRENT CERTIFICATE OF INCORPORATION AND PROPOSED
CERTIFICATE OF INCORPORATION
The specific amendments proposed to be made to the Company's Certificate of
Incorporation to provide the right to holders of Common Stock to convert their
shares of Common Stock into a like number of shares of Class A Stock are set out
in the Exhibit 1 to this Proxy Statement. Each share of outstanding Common Stock
shall be convertible, at the option of the holder thereof, into an equal number
of shares of Class A Stock.
UNITED STATES TAX CONSEQUENCES
No United States federal tax liability shall arise simply upon a conversion of
Common Stock to Class A Stock as long as the registered holder remains the same
entity after conversion and such entity continues to hold the Class A Stock.
Holders of Common Stock intending to convert such shares into Class A Stock are
advised to consult with their tax advisors regarding the consequences of
acquiring, holding or disposing of Class A Stock in light of current tax laws,
their particular investment circumstances, and the application of state, local
and foreign tax laws.
UNITED KINGDOM TAX CONSEQUENCES
The following applies to persons who are resident or ordinarily resident in the
UK for tax purposes and who hold Common Stock or Class A Stock as an investment.
The conversion of Common Stock into Class A Stock will not be treated as
involving any disposal of the Common Stock or any acquisition of Class A Stock
but the Class A Stock will be treated as the same asset as the Common Stock,
acquired at the same time and for the same consideration as the Common Stock.
Any chargeable gain or allowable loss which would otherwise have arisen on a
disposal of the Common Stock will be "rolled over" into the Class A Stock.
MECHANICS OF A CONVERSION OF COMMON STOCK TO CLASS A STOCK
Any holder of Common Stock must first surrender the certificate(s), duly
endorsed, at the office of the Company or the transfer agent for the Common
Stock, and shall give written notice to the Company of such holder's election to
convert. The address of the Company for such purpose is Farfield Park, Wath Upon
Dearne, South Yorkshire, England S63 5BD. The Company's transfer agent is: Olde
Monmouth Stock Transfer Co., Inc., 77 Memorial Highlands NJ 07716 ("the Transfer
Agent"). The notice to the Company shall state therein the name or names in
which the certificate(s) for shares of Class A Stock are to be issued whereupon
the Company shall deliver, or arrange for the delivery of, such certificate(s)
for shares of Class A Stock as such person(s) are entitled. Such notice must be
received by the Company no later than the latest date for conversion, being
December 1, 2002, whereupon the right to convert shall terminate. The conversion
shall be deemed to have been made immediately prior to the close of business on
the date of such surrender of the shares of Common Stock to be converted and the
person(s) entitled to receive shares of Class A Stock in exchange shall be
treated as the holder of such shares as of such date. The Company shall make
application to the London Stock Exchange to admit the Class A Stock arising on a
conversion of Common Stock to trading on the Alternative Investment Market of
the London Stock Exchange. However, as mentioned above, such shares so converted
may only be sold in compliance with the restrictions contained in the Company's
Certificate of Incorporation and in compliance with applicable securities laws.
Such shares may not be sold back into the US or to a US person, except under the
limited circumstances described above.
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
Management
The total number of Shares of Common Stock and Class A Stock of the Company
beneficially owned by each of the officers and directors, and all of such
directors and executive officers as a group, and their percentage ownership of
such Shares as of [ ], 2000, being the latest practical date prior to the
posting of this document, are as follows:
<TABLE>
<CAPTION>
CLASS A STOCK
NAME AND ADDRESS(1) OF COMMON STOCK PER CENT OF BENEFICIALLY PERCENT OF PERCENT OF TOTAL
BENEFICIAL OWNER(2) BENEFICIALLY OWNED COMMON STOCK OWNED CLASS A STOCK ISSUED SHARES
<S> <C> <C> <C> <C> <C>
Christopher Akers 500,000 2.8 350,000 2.9 2.83
John Spackman 85,000 0.5 Nil Nil 0.28
Philip Derry(3) 1,696,760 9.5 35,000 0.3 5.77
David Walton(4) 112,700 0.6 Nil Nil 0.38
David Linell 400,000 2.2 Nil Nil 1.33
Graham Ford 50,000 0.3 Nil Nil 0.17
Andrew Krawchuk 176,000 1.0 Nil Nil 0.59
Amanda Staveley Nil Nil 754,000 6.2 2.51
All directors and 3,020,460 16.8 1,139,000 9.4 13.86
executive officers as a
group (8 persons)
</TABLE>
Notes:
(1) The business mailing address for all management is c/o EuroTelecom
Communications, Inc., Farfield Park, Wath Upon Dearne, South Yorkshire,
England S63 5DB.
(2) Except as otherwise noted, it is believed by the Company that all persons
have full voting and investment power with respect to the Shares
indicated. Under Rule 13d-3(d)(1) of the Securities Exchange Act of 1934,
a person (or group of persons) is deemed to be a "beneficial owner" of a
security if he or she, directly or indirectly, has or shares the power to
vote or to direct the voting of such security, or the power to dispose of
or to direct the disposition of such security. Accordingly, more than one
person may be deemed to be a beneficial owner of the same security. A
person is also deemed to be a beneficial owner of any security which that
person has the right to acquire within sixty (60) days, such as options
or warrants to purchase the Common Stock or Class A Stock of the Company.
(3) 25,000 Shares are held in the name of Mr. Derry's wife.
(4) 2,700 Shares are held by a broker, on behalf of Mr. Walton's wife.
<PAGE>
Principal stockholders
The following table sets forth information with respect to the beneficial
ownership of the Company's Common Stock and Class A Stock by each shareholder
who beneficially owns more than five percent (5%) of such Shares in aggregate,
the number of Shares beneficially owned by each and their percentage ownership
of such Shares as of [ ], 2000, being the latest practical date prior to mailing
of this form. It is believed by the Company that all persons listed have sole
voting and investment power with respect to their Shares, except as otherwise
indicated.
<TABLE>
<CAPTION>
COMMON STOCK PER CENT OF CLASS A STOCK PERCENT OF
NAME AND ADDRESS OF BENEFICIAL BENEFICIALLY OWNED COMMON STOCK BENEFICIALLY PERCENT OF TOTAL ISSUED
OWNER(1) OWNED CLASS A STOCK SHARES
<S> <C> <C> <C> <C> <C>
Philip Shaun Derry 1,696,760 9.5 35,000 0.3 5.8
c/o EuroTelecom
Communications, Inc.
Farfield Park
Wath Upon Dearne
South Yorkshire
England
Benchlevel Properties Ltd 1,100,000 6.1 Nil Nil 3.7
19 Warwick Gardens
London, England
Scribe Investments SA 2,475,000 13.8 Nil Nil 8.2
2 Sergeants Inn
London, England
Westbury Investments SA 2,475,000 13.8 Nil Nil 8.2
2 Serjeants Inn
London, England
</TABLE>
Notes:
(1) See note (2) in table above.
<PAGE>
COST OF SOLICITATION
The entire cost of preparing, assembling, printing and mailing this Proxy
Statement, the enclosed Proxy, the Notice of Special Meeting and other
materials, and the cost of soliciting Proxies with respect to the Special
Meeting, will be borne by the Company. The solicitation of Proxies by mail may
be supplemented by telephone and telegram by officers and other regular
employees of the Company, but no additional compensation will be paid to such
individuals.
STOCKHOLDER PROPOSALS
Pursuant to Rule 14a-8 under the Exchange Act, stockholders may present proper
proposals for inclusion in the Company's proxy statement in respect of and for
consideration at the next annual meeting of its stockholders by submitting their
proposals to the Company in a timely manner. To be included in the proxy
statement for the Company's Annual Meeting of Stockholders, stockholder
proposals must be received by the Company at its principal executive offices no
later than a reasonable period prior to the date of the next Annual Meeting (the
date of which has not yet been fixed) and must otherwise comply with the
requirements of Rule 14a-8 under the Securities Act of 1934. All such notices of
proposals by stockholders should be sent for the attention of the Secretary of
the Company at Farfield Park, Wath Upon Dearne, South Yorkshire, England S63 5DB
OTHER MATTERS
The Company knows of no matters other than the matters described above which
will be presented at the Special Meeting. However, if other matters are properly
brought before the Special Meeting, the persons voting the proxies will vote
them as they deem in the best interests of the Company.
BY ORDER OF THE BOARD OF DIRECTORS
By: /s/ Graham Ford
Secretary
[ ], 2000
<PAGE>
EXHIBIT INDEX
Exhibit Number Exhibit
1. Proposed Amendments to Certificate of Incorporation
