UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Sections 13 or 15(d) of the Securities and Exchange Act of 1934
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Date of Report (Date of earliest event reported): December 8, 2000
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WAVERIDER COMMUNICATIONS INC.
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(Exact name of registrant as specified in charter)
NEVADA
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(State or other jurisdiction of incorporation or organization)
0-25680 33-0264030
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(Commission File Number) (I.R.S. Employer Identification Number)
255 Consumers Road, Suite 500, Toronto, Ontario, Canada M2J 1R4
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(Address of principal executive offices) (Zip Code)
(416) 502-3200
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(Registrant's telephone number, including area code)
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(Former name or former address, if changed since last report)
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Item 5. Sale of convertible notes
On December 12, 2000, WaveRider Communications Inc. announced it had finalized a
private financing agreement that may result in proceeds of up to (U.S.) $27
million by the end of its fiscal year in December, 2001. The financing will be
used to fund WaveRider's sales activities, new product launches, entry into new
product categories and other working capital needs.
Under a Securities Purchase Agreement, dated December 8, 2000, with Capital
Ventures International, a Cayman Islands unlimited liability corporation,
WaveRider received $5 million dollars in exchange for a 2 year 6% convertible
note, five year warrants to purchase 2,461,538 shares of common stock,
exercisable at $3.35 per common share, and one year warrants to purchase
5,907,692 shares of common stock, exercisable at $2.539 per common share. The
convertible note will automatically be converted to shares of common stock upon
the effective date of a registration statement, on Form S-3, which the Company
plans to file within 20 days of the closing of the Agreement. The conversion
rate for the convertible note will be the lesser of $2.4375 or 90% of the market
price of the stock at the time the registration statement become effective.
In addition, 30 days after the registration statement becomes effective, or 90
days after the closing whichever is later (the "second closing"), the Company
will sell an additional $7 million in 2 year 6% convertible notes and five year
warrants. The second convertible notes will be convertible at the lesser of
$2.64 per share or 90% of the market price at the time a second registration
statement becomes effective. The 5 year warrants connected with this second
offering will be exercisable at 1.65% of the market price at the second closing.
The completion of the second closing is subject to satisfaction of a number of
conditions, including a minimum average Closing Bid Price for the Company's
common stock equal to or greater than $1.75 per share.
As part of the terms of the arrangement, if, after June 8, 2001, six months from
the initial agreement, the average bid price of the common stock is equal to or
greater than $3.81 the Company may, in its discretion, require the exercise of
the one year warrants. Alternatively, if the Company were to proceed with an
underwritten public offering of shares, it could require the holders to exercise
or relinquish their rights under the one year warrants. If these warrants were
to be exercised in full, the Company would receive an additional $15 million.
Exhibits
10.1 Security Purchase Agreement between WaveRider Communications Inc. and
Capital Ventures International dated December 8, 2000.
10.2 First Convertible Note dated December 8, 2000
10.3 Second Convertible Note, to be completed at the Second Closing
10.4 Class J Warrant, for the right to purchase 2,461,538 Shares of Common
Stock at an exercise price of $3.35 per common share, for a period of
five years, ending December 8, 2005
10.5 Class K Warrant, for the right to purchase 5,907,692 Shares of Common
Stock at an exercise price of $2.539 per common share, for a period of
one year ending December 8, 2001
10.6 Class L Warrant, for the right to purchase a number of shares equal to
$7 million based on the market price of the Company's Shares of Common
Stock on the date of the Second Closing.
10.7 First Registration Rights Agreement
10.8 Second Registration Rights Agreement
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Signatures:
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this current report on Form 8-k to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: December 12, 2000
WaveRider Communications Inc.
Per: /s/ Bruce Sinclair
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Bruce Sinclair, President
