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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 13, 1996
RADIUS INC.
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(Exact name of registrant as specified in its charter)
California
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(State or other jurisdiction of incorporation)
0-18690 68-0101300
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(Commission (IRS Employer
File Number) Identification No.)
215 Moffett Park Drive, Sunnyvale, CA 94089
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(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code: (408) 541-6100
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This report on Form 8-K consists of 3 pages.
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Item 5: OTHER EVENTS.
On September 13, 1996, Radius Inc. (the "Company") consummated its
previously announced debt for equity exchange. IBM Credit Corporation ("IBM
Credit"), the Company's secured creditor, received Series A Convertible
Preferred Stock in satisfaction of $3.0 million of the Company's approximately
$26.4 million secured indebtedness to IBM Credit and restructured its loan with
the Company, including extension by IBM Credit of an additional advance of
approximately $470,000 for making the discounted payments to unsecured creditors
described below. The Company and IBM Credit have also entered into an amended
loan agreement, with respect to the Company's remaining approximately $23.4
million.
The Company's unsecured creditors with aggregate claims of approximately
$47.8 million received either shares of Common Stock or, in the case of
creditors with claims of less than $50,000 ("Convenience Class Creditors), a
discounted cash payment (approximately $470,000 in the aggregate) in
satisfaction of such claims. Unsecured creditors who agreed to receive equity
in satisfaction of their claims received an aggregate of 36,294,198 shares of
Common Stock (which now represent approximately 60% of the outstanding Common
Stock of the Company). The Company's secured creditor, IBM Credit, received
750,000 shares of Series A Convertible Preferred Stock which is convertible into
5,523,030 shares of Common Stock of the Company (or 6,075,333 shares in certain
circumstances). The unsecured creditors who agreed to receive equity in
satisfaction of their claims also received Rights ("Rights") to receive an
aggregate of 11,046,060 additional shares of the Company's Common Stock in the
event that the Series A Convertible Preferred Stock is converted into Common
Stock so that the number of shares of Common Stock received by such unsecured
creditors continues to represent 60% of the Company's outstanding Common Stock.
The Company also expects to amend its stock option plans to reserve for issuance
thereunder approximately 10% of the outstanding shares of the Company's Common
Stock. Therefore, shareholders holding shares of Common Stock immediately prior
to the closing of this debt-for-equity exchange ("Existing Shareholders") will
represent approximately 30% of outstanding shares of Common Stock immediately
after the closing. If and when the Series A Convertible Preferred Stock is
converted into Common Stock, Existing Shareholders will then represent 23% of
the outstanding shares of Common Stock (assuming no other issuances of the
Company's securities and the exercise of all stock options).
The Company previously included certain pro forma financial information
with respect to the above-described debt-for-equity exchange in its Current
Report on Form 8-K dated August 30, 1996.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: September 13, 1996
RADIUS INC.
By: /s/ Charles W. Berger
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Charles W. Berger
Chairman, President, Chief Executive
Officer and Acting Chief Financial Officer
