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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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) August 7, 1996
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AMERICAN TELECASTING, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 0-23008 54-1486988
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(State or Other (Commission (IRS Employer
Jurisdiction of Incorporation) File Number) Identification No.)
5575 Tech Center Drive, Suite 300, Colorado Springs, Colorado 80919
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (719) 260-5533
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(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events.
On August 7, 1996, American Telecasting, Inc. (the "Company") completed
a private placement (the "Private Placement") of 100,000 shares of a newly
created series of its preferred stock, designated as "Series B Convertible
Preferred Stock" (the "Series B Preferred Stock") to two investors in exchange
for $10.0 million in cash. A Certificate of Designation (the "Certificate of
Designation") for the Series B Preferred Stock was filed with the Delaware
Secretary of State on August 6, 1996. Pursuant to the terms of the Certificate
of Designation, each share of Series B Preferred Stock is convertible, at the
option of the holder, during the period that commences no later than the 45th
day following the date of issuance thereof and ends on the first anniversary of
the issuance thereof, into shares of the Company's Class A Common Stock, par
value $0.01 per share (the "Common Stock"), pursuant to a conversion formula
that is a function of the prevailing market price of the Common Stock. The
Company also has the right to require conversion of the Series B Preferred
Stock into Common Stock at any time at specified conversion ratios.
The holders of Series B Preferred Stock are entitled to receive
preferential cumulative dividends at the rate of 5% per share per annum
commencing on the date of issuance of the Series B Preferred Stock and payable
solely in shares of Common Stock on the earlier of the first anniversary of the
date of issuance of the Series B Preferred Stock or the date of conversion
thereof. The Series B Preferred Stock ranks senior to any other class of
capital stock of the Company as to the payment of dividends and the
distribution of assets on redemption, liquidation, dissolution or winding up of
the Company. Except as otherwise required by law, the Series B Preferred Stock
has no voting rights.
In connection with the Private Placement, the Company agreed to
register the shares of Common Stock issuable upon conversion of the Series B
Preferred Stock under the Securities Act and relevant blue sky laws in order to
permit the resale of such Common Stock.
Item 7(c). Exhibits
4.1 Certificate of Designation For Series B Convertible Preferred
Stock of American Telecasting, Inc.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN TELECASTING, INC.
/s/ David K. Sentman
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David K. Sentman
Senior Vice President and
Chief Financial Officer
Dated: August 7, 1996
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN TELECASTING, INC.
/s/ DAVID K. SENTMAN
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David K. Sentman
Senior Vice President and
Chief Financial Officer
Dated: August 7, 1996
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
4.1 Certificate of Designation For Series B Convertible Preferred
Stock of American Telecasting, Inc.
</TABLE>
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CERTIFICATE OF DESIGNATION
FOR
SERIES B CONVERTIBLE PREFERRED STOCK
OF
AMERICAN TELECASTING, INC.
AMERICAN TELECASTING, INC., a Delaware corporation (the
"Corporation"), through its duly authorized officers, does hereby certify that
pursuant to authority conferred upon the Board of Directors by the Restated
Certificate of Incorporation of the Corporation, as amended, and pursuant to
the provisions of Section 151 of the General Corporation Law of Delaware, the
Board of Directors of the Corporation, by unanimous written consent of its
members dated as of August 1, 1996, adopted the following preambles and
resolutions approving the issuance of a series of 500,000 shares of Series B
Convertible Preferred Stock:
WHEREAS, the Corporation is authorized by its Restated Certificate of
Incorporation to issue up to 3,000,000 shares of Preferred Stock, par value
$.01 per share (the "Preferred Stock"), in one or more classes or series as
determined by the Board of Directors, and the Restated Certificate of
Incorporation, as amended, provides that the Board of Directors shall adopt
resolutions providing for the voting powers, and such designations,
preferences, special rights and qualifications, and limitation or restrictions
thereof; and
WHEREAS, the Board of Directors has determined that it is in the best
interests of the Corporation to designate 500,000 shares of the Preferred Stock
as Series B Convertible Preferred Stock;
NOW, THEREFORE, BE IT RESOLVED THAT:
1. Designation. A series of Preferred Stock consisting of
500,000 shares is hereby created, established and designated as "Series B
Convertible Preferred Stock" (hereinafter referred to as the "Series B
Convertible Preferred Stock").
2. Conversion Rights.
(a) Right to Convert by Holder. Each original share of
Series B Convertible Preferred Stock acquired by any holder may be
converted, at the option of the holder thereof, at any time during the
period commencing on and including the earlier of (i) the date a
registration statement covering the resale of Class A Common Stock
into which the Series B Convertible Preferred Stock is convertible has
been declared effective by the Securities and Exchange Commission, and
(ii) the forty-fifth (45th) day following the date of original
issuance thereof, and expiring on the first anniversary of the date of
original issuance thereof, without the payment of any additional
consideration therefor, into that number of fully paid and
nonassessable shares of Class A Common Stock of the Corporation as is
determined by dividing (A) the sum of (1) the original per share
issuance price paid to the Corporation for each such share of Series B
Convertible Preferred Stock plus (2) the amount of all accrued but
unpaid dividends on each share of Series B Convertible Preferred Stock
being so converted by (B) the Conversion Price (determined as
hereinafter provided) in effect at the time of conversion. The
"Conversion Price" shall be equal 80% of the Market Price of the
Corporation's Class A Common Stock; provided, however, that in no
event will the Conversion Price be greater than $12.50 or less than
$2.00. For purposes of this Section 2, the Market Price shall be the
average of the closing bid prices per share of the Class A Common
Stock for the three (3) trading days immediately preceding the date
the Conversion Notice is sent via telecopier, with telephone
confirmation of receipt, as reported by the National Association of
Securities Automated Quotation System ("NASDAQ"), or in the event the
Class A Common Stock is listed on a national stock exchange, the
Market Price shall be the average of the closing bid prices of the
Class A Common Stock on such exchange, as reported in The Wall Street
Journal, on the three trading days immediately preceding the date of
the Conversion Notice. The Conversion Notice shall mean the Holder
Conversion Notice (as defined in Section 2(c)) in the event of a
conversion pursuant to Section 2(a) and shall mean the Mandatory
Conversion Notice (as defined in Section 2(d)) in the event of a
conversion pursuant to Section 2(b).
(b) Mandatory Conversion by the Corporation. The
Corporation shall have the right at any time prior to the first
anniversary of the original issuance of a share of Series B
Convertible Preferred Stock to require that such share be converted
into that number of fully paid and nonassessable shares of Class A
Common Stock as is determined by dividing (i) the sum of (A) the One
Hundred and Twenty Percent (120%) of the original per share issuance
price paid to the Corporation for such share of Series B Convertible
Preferred Stock plus (B) the amount of all accrued but unpaid
dividends on such share of Series B Convertible Preferred Stock by
(ii) the Conversion Price.
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The Corporation shall have the right at any time after the first
anniversary of the original issuance of a share of Series B
Convertible Preferred Stock to require that such share be converted
into that number of fully paid and nonassessable shares of Class A
Common Stock as is determined by dividing (i) the sum of (A) the One
Hundred and One Percent (101%) of the original per share issuance
price paid to the Corporation for such share of Series B Convertible
Preferred Stock plus (B) the amount of all accrued but unpaid
dividends on such share of Series B Convertible Preferred Stock by
(ii) the Conversion Price.
(c) Mechanics of Conversion. No fractional shares of the
Class A Common Stock shall be issued upon conversion of Series B
Convertible Preferred Stock under Sections 2(a) and (b) above. If
upon conversion of shares of Series B Convertible Preferred Stock held
by a registered holder which are being converted, such registered
holder would, but for the provisions of this Section 2(c), receive a
fraction of a share of Class A Common Stock thereon, then the number
of shares to which such holder is otherwise entitled shall be rounded
down to the nearest whole number of shares. Before any holder of
Series B Convertible Preferred Stock shall be entitled to convert the
same into full shares of Class A Common Stock under Section 2(a)
above, such holder shall surrender the original certificate or
certificates therefor, duly endorsed, at the office of the Corporation
or of any transfer agent for the Series B Convertible Preferred Stock,
and shall give written notice (the "Holder Conversion Notice") to the
Corporation at its principal office and shall state therein such
holder's name or the name and address of names and addresses of its
nominees in which such holder wishes the certificate or certificates
for shares of Class A Common Stock to be issued. The Corporation
shall, as soon as practicable thereafter, but in any event within
three business days of the date of its receipt of the Holder
Conversion Notice and the original certificate or certificates for
such holder's Series B Convertible Preferred Stock, issue and transmit
or cause to be issued and transmitted, via express courier or
otherwise, to such holder of Series B Convertible Preferred Stock, or
to its nominees, a certificate or certificates for the number of
shares of Class A Common Stock to which such holder shall be entitled.
Such conversion shall be deemed to have been made on the date that the
Corporation receives the Holder Conversion Notice, and the person or
persons entitled to receive the shares of Class A Common Stock
issuable upon conversion shall be treated for all purposes as the
record holder or holders of such shares of Class A Common Stock on
such date. Upon the conversion of any shares of Series B Convertible
Preferred Stock, such shares shall be restored to the status of
authorized but unissued shares and may be reissued by the Corporation
at any time.
(d) Additional Procedures for Mandatory Conversion. The
Corporation may exercise the right to convert the outstanding shares
of Series B Convertible Preferred Stock pursuant to Section 2(b) by
delivering written notice thereof (the "Mandatory Conversion Notice")
by telecopier (or mailed if no telecopier is known by first class,
certified mail, return receipt requested, postage prepaid), to the
holders of the Series B Convertible Preferred Stock, at such
registered holder's address appearing on the stock register of the
Corporation. The Mandatory Conversion Notice shall be sent by
telecopier (or mailed if no telecopier number is known) on a date (the
"Mandatory Notice Date") not fewer than fifteen (15) nor more than
sixty (60) days prior to the Mandatory Conversion Date. The Mandatory
Conversion Notice sent to a registered holder shall state (i) the
Mandatory Conversion Date, (ii) the number of shares of Series B
Convertible Preferred Stock owned by such registered holder subject to
mandatory conversion, (iii) the total number of shares of Class A
Common Stock to be issued to such registered holder in exchange for
all shares of Series B Convertible Preferred Stock held thereby, and
(iv) the places where certificates for such shares of Series B
Convertible Preferred Stock are to be surrendered for exchange. A
Mandatory Conversion Notice having been given as aforesaid, the
certificates for the shares of Series B Convertible Preferred Stock to
be converted as provided in such notice shall be surrendered to the
Corporation not later than sixty (60) days after the Mandatory
Conversion Date at the place designated for that purpose in such
Mandatory Conversion Notice, which certificate or certificates, if the
Corporation shall so request and the Mandatory Conversion Notice shall
so state, shall be duly endorsed or assigned in blank or to the
Corporation (if required by it). A registered holder surrendering
shares of Series B Convertible Preferred Stock to the Corporation in
response to a Mandatory Conversion Notice shall give written notice to
the Corporation at the place specified in the Mandatory Conversion
Notice that such shares of Series B Convertible Preferred Stock are
being surrendered for conversion, and shall state in writing therein
the name or names (with address) in which the certificate or
certificates for the shares of Class A Common Stock are to be issued.
Subject to the provisions of the following sentence, all shares of
Series B Convertible Preferred Stock issued and outstanding on the
Mandatory Notice Date shall be deemed to have been converted into
shares of Class A Common Stock on the Mandatory Conversion Date. From
and after a time immediately prior to the close of business on the
Mandatory Conversion Date (unless default shall be made by the
Corporation in providing shares of Class A Common Stock in accordance
with the Mandatory Conversion Notice) (A) all rights of the holders of
the shares of
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Series B Convertible Preferred Stock as stockholders of the
Corporation, except as expressly provided in clauses (B) and (C)
below, shall cease and terminate, and such shares shall not thereafter
be deemed to be outstanding, notwithstanding that any certificate for
any such shares shall not have been surrendered for exchange, (B)
until so surrendered for exchange, each outstanding certificate for
shares of Series B Convertible Preferred Stock shall be deemed for all
purposes, other than the payment of dividends or other distributions
on the Class A Common Stock, to evidence ownership of the number of
shares of Class A Common Stock for which such shares of Series B
Convertible Preferred Stock are to be exchanged, and (C) no dividend
or other distribution (if any) payable to holders of shares of Class A
Common Stock of record subsequent to such time shall be paid on the
shares of Class A Common Stock issuable in exchange for any shares of
Series B Convertible Preferred Stock represented by certificates which
have not been so surrendered until such certificates have been
surrendered to the Corporation as required under the Mandatory
Conversion Notice. As promptly as practicable after the Mandatory
Conversion Date and such surrender of a certificate or certificates
for shares of Series B Convertible Preferred Stock and all instruments
and notices above prescribed or required by law, the Corporation shall
issue and deliver to or upon the written order of the surrendering
holder, at the place designated by such holder, a certificate or
certificates for the number of shares of Class A Common Stock to which
such holder is entitled. In the event that a registered holder
exercises its conversion rights under Section 2(a) and the Corporation
exercises its conversion rights under Section 2(b), then if the Holder
Conversion Notice is received by the Corporation prior to the
Mandatory Notice Date, the conversion shall be governed by Section
2(a). If, on the other hand, the Corporation receives the Holder
Conversion Notice after the Mandatory Notice Date, the conversion
shall be governed by Section 2(b).
(e) Notices of Record Date. In the event of (i) any
declaration by the Corporation of a record date of the holders of any
class of securities for the purpose of determining the holders thereof
who are entitled to receive any dividend or other distribution, or
(ii) any capital reorganization of the Corporation, any
reclassification or recapitalization of the capital stock of the
Corporation, any merger or consolidation of the Corporation, and any
transfer of all or substantially all of the assets of the Corporation
to any other Corporation, or any other entity or person, or any
voluntary or involuntary dissolution, liquidation or winding up of the
Corporation, the Corporation shall mail to each holder of Series B
Convertible Preferred Stock at least 20 days prior to the record date
specified therein, a notice specifying (A) the date on which any such
record is to be declared for the purpose of such dividend or
distribution and a description of such dividend or distribution, (B)
the date on which any such reorganization, reclassification, transfer,
consolidation,merger, dissolution, liquidation or winding up is
expected to become effective, and (C) the time, if any, that is to be
fixed, as to when the holders of record of Class A Common Stock (or
other securities) shall be entitled to exchange their shares of Class
A Common Stock (or other securities) for securities or other property
deliverable upon such reorganization, reclassification, transfer,
consolidation, merger, dissolution or winding up.
(f) Stock Dividends; Stock Splits, Etc. In the event the
Corporation shall (i) take a record of holders of shares of the Class
A Common Stock for the purpose of determining the holders entitled to
receive a dividend payable in shares of Class A Common Stock, (ii)
subdivide the outstanding shares of Class A Common Stock, (iii)
combine the outstanding shares of Class A Common Stock into smaller
numbers of shares, or (iv) issue, by reclassification of the Class A
Common Stock, any other securities of the Corporation, then, in each
such case, the Conversion Price then in effect shall be adjusted so
that upon the conversion of each share of Series B Convertible
Preferred Stock then outstanding the number of shares of Class A
Common Stock into which such shares of Series B Convertible Preferred
Stock are convertible after the happening of any of the events
described in clauses (i) through (iv) above shall be the number of
such shares of Class A Common Stock into which such shares of Series B
Convertible Preferred Stock would have been converted if so converted
immediately prior to the happening of such event or any record date
with respect thereto.
(g) Class A Common Stock Reserved. The Corporation shall
reserve and keep available out of its authorized but unissued Class A
Common Stock such number of shares of Class A Common Stock as shall
from time to time be sufficient to effect conversion of all of the
then outstanding shares of Series B Convertible Preferred Stock.
3. Dividend Rights. The holders of record of Series B
Convertible Preferred Stock shall be entitled to receive pay-in-kind cumulative
dividends thereon, to the extent permitted by law, at the rate of five percent
(5%) per share, per annum, computed on the basis of the actual number of days
elapsed in a 365-day year, commencing on the date of the issuance of such
shares of Series B Convertible Preferred Stock and payable on the first to
occur of (i) the anniversary date of the issuance
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thereof, and (ii) the date of conversion thereof in accordance with the
provisions of Section 2 above. Such dividends shall be fully cumulative and
shall accrue, whether or not declared by the Board of Directors of the
Corporation, from the date of the issuance of the shares of Series B
Convertible Preferred Stock until the date of payment thereof as set forth in
the immediately preceding sentence. No dividends or other distributions shall
be paid on or declared and set aside for payment on the Common Stock until full
cumulative dividends on all outstanding shares of Series B Convertible
Preferred Stock shall have been paid or declared and set aside for payment.
Such dividends shall be payable solely in fully paid and nonassessable shares
of Class A Common Stock, with such shares of Class A Common Stock valued at the
average of the closing bid prices of such shares on the three trading days
immediately preceding the date of payment thereof, as such closing bid price is
determined pursuant to Section 2 above.
4. Voting Rights of Series B Convertible Preferred Stock. Except
as otherwise required by law, the holders of outstanding shares of Series B
Convertible Preferred Stock shall not be entitled to vote on any matters
submitted to the stockholders of the Corporation.
5. Ranking. Except as expressly set forth herein, the Series B
Convertible Preferred Stock shall rank senior to any other class of capital
stock of the Corporation now or hereafter issued as to the payment of dividends
and the distribution of assets on redemption, liquidation, dissolution or
winding up of the Corporation.
6. Liquidation Rights. If the Corporation shall be voluntarily
or involuntarily liquidated, dissolved or wound up at any time when any shares
of Series B Convertible Preferred Stock shall be outstanding, the holders of
the then outstanding shares of Series B Convertible Preferred Stock shall have
a preference in distribution of the Corporation's property available for
distribution to the holders of any other class of capital stock of the
Corporation, including, but not limited to, the Common Stock, equal to the
original per share issuance price paid to the Corporation for each such share
of Series B Convertible Preferred Stock, together with an amount equal to all
accrued but unpaid dividends thereon, if any, to the date of payment of such
distribution, whether or not declared by the Board. For this purpose, the
merger or consolidation of the Corporation with or into any other corporation
or corporations, the sale or transfer by the Corporation of all or
substantially all of its property, or any reduction of the authorized or issued
capital of the Corporation of any class, whether now or thereafter authorized,
shall be deemed to be the liquidation of the Corporation within the meaning of
the provisions of this Section 6.
* * * *
[signatures on the following page]
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IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation to be signed by Robert D. Hostetler, the Chief Executive Officer &
President of the Corporation, and attested by David K. Sentman, the Assistant
Secretary of the Corporation, as of this ___ day of August, 1996.
By:
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Robert D. Hostetler
Chief Executive Officer & President
Attest:
By:
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David K. Sentman
Assistant Secretary
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