RULE NO. 424(b)(3)
REGISTRATION NUMBER 333-35910
PROSPECTUS SUPPLEMENT NO. 5 DATED DECEMBER 26, 2000
(TO PROSPECTUS DATED AUGUST 3, 2000)
PSINet
[LOGO]
16,500,000 SHARES OF 7% SERIES D CUMULATIVE CONVERTIBLE PREFERRED STOCK
15,430,800 SHARES OF COMMON STOCK ISSUABLE ON CONVERSION
5,000,000 SHARES OF COMMON STOCK ISSUABLE AS DIVIDENDS
750,000 SHARES OF COMMON STOCK ISSUABLE IN EXCHANGE
FOR FUNDS HELD IN A DEPOSIT ACCOUNT
-------------------------------------
This supplement amends and supplements certain
information contained in the prospectus, dated August 3, 2000.
This supplement is not complete without, and may not be
delivered or utilized except in connection with, the
prospectus, including any amendments or supplements to the
prospectus. The information contained in this supplement
supersedes any contrary statements contained in the prospectus.
This supplement relates to the sale from time to time
by the selling shareholders of up to 16,500,000 shares of our
Series D preferred stock and up to 15,430,800 shares of our
common stock issuable upon conversion of the Series D preferred
stock. In addition, we may issue to the selling shareholders up
to 5,000,000 shares of common stock as dividends on the Series
D preferred stock and up to 750,000 shares of common stock in
lieu of cash payments otherwise required under the deposit
account arrangement described in the prospectus.
INVESTMENT IN OUR SECURITIES INVOLVES SIGNIFICANT
RISKS AND UNCERTAINTIES. PLEASE SEE "RISK FACTORS" IN EXHIBIT
99.1 TO OUR FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2000,
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON
NOVEMBER 14, 2000, WHICH CONTAINS A DISCUSSION OF CERTAIN
MATERIAL RISKS INCORPORATED BY REFERENCE INTO THIS REGISTRATION
STATEMENT AND OTHER FILINGS MADE BY US WITH THE SECURITIES AND
EXCHANGE COMMISSION.
----------------------------------
The date of this supplement is December 26, 2000
<PAGE>
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SELLING SHAREHOLDERS
In February 2000 we issued an aggregate of 16,500,000 shares of our
Series D preferred stock in an offering made pursuant to Rule 144A under the
Securities Act of 1993. The Series D preferred stock is convertible into shares
of our common stock.
None of the selling shareholders has held any position or office or had
a material relationship with PSINet or any of its affiliates within the past
three years, except for Donaldson, Lufkin & Jenrette Securities Corporation,
which, from time to time, has served as our investment banker and an underwriter
and initial purchaser of our securities and Merrill Lynch, Pierce Fenner and
Smith Inc. which, from time to time, has served as an underwriter and initial
purchaser of our securities.
The following table sets forth information as of November 27, 2000,
which has been provided to us by the selling shareholders, regarding beneficial
ownership of our Series D preferred stock and common stock by each selling
shareholder.
<TABLE>
<CAPTION>
SHARES THAT
SHARES MAY BE SOLD
BENEFICIALLY PURSUANT TO THIS SHARES OWNED
OWNED(1) PROSPECTUS AFTER OFFERING
------------------------------- --------------------------- -------------------------------
SERIES D SERIES D SERIES D
PREFERRED COMMON PREFERRED COMMON PREFERRED COMMON
STOCK STOCK(2) STOCK STOCK STOCK STOCK(3)
------------------------------- --------------------------- -------------------------------
No. of No. of No. of No. of No. of No. of
SELLING SHAREHOLDERS Shares Shares Shares Shares Shares % Shares %
-------------------- ------ ------ ------ ------ ------ ------- ------ ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Abbott Laboratories Annuity
Retirement Plan............. 4,000 3,741 4,000 3,741 -- -- -- --
Alscott Investments, LLC.... 56,006 52,377 56,006 52,377 -- -- -- --
Alta Partners Holdings, LDC. 150,000 140,280 150,000 140,280 -- -- -- --
Argent Classic Convertible
Arbitrage Fund (Bermuda) L.P. 240,000 224,448 240,000 224,448 -- -- -- --
Aspen Growth & Income
Fund ..................... 31,446 29,409 31,446 29,409 -- -- -- --
Bank America Pension Plan... 75,000 70,140 75,000 70,140 -- -- -- --
Bankers Life and Casualty
Company- Convertible........ 20,000 18,704 20,000 18,704 -- -- -- --
California Public Employees'
Retirement System........... 165,000 154,308 165,000 154,308 -- -- -- --
CFFX, LLC................... 92,600 86,600 92,600 86,600 -- -- -- --
Circlet (IMA) Limited....... 66,700 62,378 66,700 62,378 -- -- -- --
Credit Suisse First Boston
Corporation................. 1,890,130 1,767,650 1,890,130 1,767,650 -- -- -- --
Deeprock & Co............... 75,000 70,140 75,000 70,140 -- -- -- --
Deutsche Bank Securities Inc 908,000 849,162 908,000 849,162 -- -- -- --
Donaldson, Lufkin & Jenrette
Securities Corp............. 444,000 415,229 444,000 415,229 -- -- -- --
ECT Investments, Inc........ 150,000 140,280 150,000 140,280 -- -- -- --
Family Service Life
Insurance Co................ 12,000 11,223 12,000 11,223 -- -- -- --
<PAGE>
-2-
SHARES THAT
SHARES MAY BE SOLD
BENEFICIALLY PURSUANT TO THIS SHARES OWNED
OWNED(1) PROSPECTUS AFTER OFFERING
------------------------------- --------------------------- -------------------------------
SERIES D SERIES D SERIES D
PREFERRED COMMON PREFERRED COMMON PREFERRED COMMON
STOCK STOCK(2) STOCK STOCK STOCK STOCK(3)
------------------------------- --------------------------- -------------------------------
No. of No. of No. of No. of No. of No. of
SELLING SHAREHOLDERS Shares Shares Shares Shares Shares % Shares %
-------------------- ------ ------ ------ ------ ------ ------- ------ ----
Federated Insurance Series,
on behalf of its Federated
Utility Fund II............. 54,000 50,501 54,000 50,501 -- -- -- --
Federated Utility Fund, Inc. 347,000 324,515 347,000 324,515 -- -- -- --
Fidelity Financial Trust:
Fidelity Convertible
Securities Fund............. 214,800 200,881 214,800 200,881 -- -- -- --
Fundamental Investors, Inc.. 575,000 537,740 575,000 537,740 -- -- -- --
General Motors Welfare
Benefit Trust (L-T Veba).... 77,500 72,478 77,500 72,478 -- -- -- --
General Motors Welfare
Benefit Trust (S-T Veba).... 50,000 46,760 50,000 46,760 -- -- -- --
GLG Market Neutral Fund..... 413,800 386,986 413,800 386,986 -- -- -- --
Goldman Sachs and Company... 35,990 33,658 35,990 33,658 -- -- -- --
Granville Capital Corporation. 128,000 119,706 128,000 119,706 -- -- -- --
Guardian Life Insurance Co.. 180,000 168,336 180,000 168,336 -- -- -- --
Guardian Pension Trust...... 8,000 7,482 8,000 7,482 -- -- -- --
JADV Growth & Income Fund... 4,046 3,784 4,046 3,784 -- -- -- --
Janus Growth & Income Fund.. 1,313,953 1,228,809 1,313,953 1,228,809 -- -- -- --
JMG Capital Partners, LP.... 509,850 476,812 509,850 476,812 -- -- -- --
JMG Triton Offshore Fund
Ltd......................... 1,019,350 953,297 1,019,350 953,297 -- -- -- --
JNL/Janus Growth & Income Fund 2,975 2,783 2,975 2,783 -- -- -- --
JP Morgan Securities, Inc... 282,600 264,288 282,600 264,288 -- -- -- --
Kansas City Life Insurance
Company..................... 20,000 18, 704 20,000 18,704 -- -- -- --
KBC Financial Products
USA Inc..................... 160,000 149,632 160,000 149,632 -- -- -- --
KVS Growth and Income Fund.. 10,535 9,853 10,535 9,853 -- -- -- --
L.A. Fire and Police Pension
Fund........................ 429,000 401,201 429,000 401,201 -- -- -- --
Lincoln National Global Asset
Allocation Fund, Inc. ...... 900 842 900 842 -- -- -- --
LLT, Ltd.................... 32,000 29,926 32,000 29,926 -- -- -- --
Lyxor Master Fund........... 73,300 68,550 73,300 68,550 -- -- -- --
MassMutual Corporate
Investors................... 15,000 14,028 15,000 14,028 -- -- -- --
MassMutual Corporate Value
Partners Limited............ 40,000 37,408 40,000 37,408 -- -- -- --
MassMutual High Yield
Partners II LLC............. 65,000 60,788 65,000 60,788 -- -- -- --
Massachusetts Mutual Life
Insurance Company........... 65,000 60,788 65,000 60,788 -- -- -- --
<PAGE>
-3-
SHARES THAT
SHARES MAY BE SOLD
BENEFICIALLY PURSUANT TO THIS SHARES OWNED
OWNED(1) PROSPECTUS AFTER OFFERING
------------------------------- --------------------------- -------------------------------
SERIES D SERIES D SERIES D
PREFERRED COMMON PREFERRED COMMON PREFERRED COMMON
STOCK STOCK(2) STOCK STOCK STOCK STOCK(3)
------------------------------- --------------------------- -------------------------------
No. of No. of No. of No. of No. of No. of
SELLING SHAREHOLDERS Shares Shares Shares Shares Shares % Shares %
-------------------- ------ ------ ------ ------ ------ ------- ------ ----
McMahan Securities Co. L.P.. 65,000 60,788 65,000 60,788 -- -- -- --
Merrill Lynch, Pierce, Fenner
& Smith Inc................. 35,000 53,716 35,000 32,732 -- -- 20,984 --
Morgan Stanley Dean Witter
Convertible Securities Trust 65,000 60,788 65,000 60,788 -- -- -- --
New York Life Insurance
Company..................... 400,000 374,080 400,000 374,080 -- -- -- --
New York Life Insurance and
Annuity Corporation......... 55,000 51,436 55,000 51,436 -- -- -- --
Northrop Grumman Corporation 3,100 2,899 3,100 2,899 -- -- -- --
Old American Insurance Company 12,000 11,223 12,000 11,223 -- -- -- --
Pacific Life Insurance Company 30,000 28,056
Peoples Benefit Life
Insurance Company........... 144,700 135,324 144,700 135,324 -- -- -- --
Peoples Benefit Life
Insurance Company (Teamsters
Separate Account)........... 113,000 105,678 113,000 105,678 -- -- -- --
Pilgrim Convertible Fund.... 31,487 29,447 31,487 29,447 -- -- -- --
Pine Grove Enhanced Partners
V LLC....................... 27,600 25,812 27,600 25,812 -- -- -- --
Pitney Bowes Retirement
Fund........................ 130,922 122,439 130,922 122,439 -- -- -- --
Putnam High Yield Trust..... 69,500 64,997 69,500 64,997 -- -- -- --
Putnam High Yield Advantage
Fund........................ 159,400 149,071 159,400 149,071 -- -- -- --
Putnam High Income
Convertible and Bond Fund... 1,700 1,590 1,700 1,590 -- -- -- --
Putnam Variable Trust-Putnam
VT High Yield Fund.......... 58,700 54,897 58,700 54,897 -- -- -- --
Putnam Variable Trust-Putnam
VT Global Asset Allocation
Fund........................ 1,900 1,777 1,900 1,777 -- -- -- --
Putnam Master Income Trust.. 12,000 11,223 12,000 11,223 -- -- -- --
Putnam Premier Income Trust. 31,400 29,366 31,400 29,366 -- -- -- --
Putnam Diversified Income
Trust....................... 121,000 113,160 121,000 113,160 -- -- -- --
Putnam Convertible
Opportunities and Income Trust 1,600 1,497 1,600 1,497 -- -- -- --
Putnam Asset Allocation
Funds-Conservative Portfolio 4,000 3,741 4,000 3,741 -- -- -- --
Putnam Funds Trust-Putnam
High Yield Trust II......... 89,600 83,794 89,600 83,794 -- -- -- --
Putnam Managed High Yield
Trust....................... 5,800 5,425 5,800 5,425 -- -- -- --
Putnam Strategic Income Fund 2,700 2,525 2,700 2,525 -- -- -- --
<PAGE>
-4-
SHARES THAT
SHARES MAY BE SOLD
BENEFICIALLY PURSUANT TO THIS SHARES OWNED
OWNED(1) PROSPECTUS AFTER OFFERING
------------------------------- --------------------------- -------------------------------
SERIES D SERIES D SERIES D
PREFERRED COMMON PREFERRED COMMON PREFERRED COMMON
STOCK STOCK(2) STOCK STOCK STOCK STOCK(3)
------------------------------- --------------------------- -------------------------------
No. of No. of No. of No. of No. of No. of
SELLING SHAREHOLDERS Shares Shares Shares Shares Shares % Shares %
-------------------- ------ ------ ------ ------ ------ ------- ------ ----
Putnam Variable Trust-Putnam
VT Diversified Income Fund.. 17,700 16,553 17,700 16,553 -- -- -- --
Putnam High Yield Managed
Trust....................... 4,500 4,209 4,500 4,209 -- -- -- --
Putnam High Yield Fixed
Income Fund, LLC............ 6,400 5,986 6,400 5,986 -- -- -- --
Q Opportunity Fund, LTD..... 697,100 651,928 697,100 651,928 -- -- -- --
Retail Clerks Pension
Trust #2.................... 48,200 45,077 48,200 45,077 -- -- -- --
Robertson Stephens Inc...... 35,000 32,732 35,000 32,732 -- -- -- --
Salomon Smith Barney Inc......... 326,900 305,717 326,900 305,717 -- -- -- --
Southport Management Partners
L.P......................... 20,000 18,704 20,000 18,704 -- -- -- --
Southport Partners
International Ltd........... 212,500 198,730
St. Albans Management
Partners L.P................ 122,000 114,095 112,000 114,095 -- -- -- --
St. Claire International Ltd. 10,000 9,352
STI Capital Management...... 44,700 41,804 44,700 41,804 -- -- -- --
Strategic Global Fund-High
Yield Fixed Income (Putnam)
Fund........................ 1,500 1,403 1,500 1,403 -- -- -- --
SunAmerica Series Trust, on
behalf of its Federated
Utility Portfolio........... 33,800 31,610 33,800 31,610 -- -- -- --
Sunset Life Insurance Company
of America.................. 25,000 23,380 25,000 23,380 -- -- -- --
Susquehanna Capital Group... 74,700 69,860 74,700 69,860 -- -- -- --
The Income Fund of America,
Inc......................... 650,000 607,880 650,000 607,880 -- -- -- --
Travelers Series Fund Inc.-
Putnam Diversified Income
Portfolio................... 1,700 1,590 1,700 1,590 -- -- -- --
Yield Strategies Fund I, LP. 20,000 18,704 20,000 18,704 -- -- -- --
Yield Strategies Fund II, LP 90,000 84,168 90,000 84,168 -- -- -- --
Zurich HFR Master Hedge Fund
Index Ltd................... 20,500 19,172 20,500 19,172 -- -- -- --
------------- ------------ ------------ ------------- ------ ---------
Total.............. 14,641,790 13,714,008 14,379,290 13,456,886 0 20,984
</TABLE>
---------------------------------
(1) Includes any shares as to which the individual has sole or shared
voting power or investment power and also any shares which the
individual has the right to acquire within 60 days of the date of this
prospectus. Unless otherwise indicated in the footnotes, each person
has sole voting and investment power with respect to the shares shown
as beneficially owned.
(2) Includes shares of common stock issuable upon conversion of our
Series D preferred stock. The Series D preferred stock is convertible
into common stock at the conversion rate of .9352 shares of common
stock for each share of Series D preferred stock. Does not include
common stock that we may issue to the selling
<PAGE>
-5-
shareholders as dividends on our Series D preferred stock or in
exchange for funds held in the deposit account. See "Summary -
Description of Series D Preferred Stock."
(3) Based upon an aggregate of 191,239,850 shares of PSINet common
stock outstanding as of November 6, 2000 and assuming the sale of all
shares of Series D preferred stock offered hereby.
