SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
InfoInterActive Inc.
______________________________________________________________________________
(Name of Issuer)
Common Shares, without par value
______________________________________________________________________________
(Title of Class of Securities)
45691810C
______________________________________________________________________________
(CUSIP Number)
Paul T. Cappuccio, Esq.
Executive Vice President and General Counsel
AOL Time Warner Inc.
75 Rockefeller Plaza
New York, New York 10019
(212) 484-8000
With a copy to:
Peter S. Malloy, Esq.
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
(212) 455-2000
______________________________________________________________________________
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 18, 2001
______________________________________________________________________________
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box [ ].
(Continued on following pages)
(Page 1 of 18 pages)
CUSIP No. 4569810C 13D Page 2 of 18 Pages
______________________________________________________________________________
(1) NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
AOL Time Warner Inc.
I.R.S. Identification No. - 13-4099534
______________________________________________________________________________
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [_]
(b) [_]
______________________________________________________________________________
(3) SEC USE ONLY
______________________________________________________________________________
(4) SOURCE OF FUNDS*
OO
______________________________________________________________________________
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [_]
______________________________________________________________________________
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
______________________________________________________________________________
(7) SOLE VOTING POWER
NUMBER OF 0
SHARES _______________________________________________________________
(8) SHARED VOTING POWER
BENEFICIALLY
7,162,128 (1)
OWNED BY
_______________________________________________________________
EACH (9) SOLE DISPOSITIVE POWER
REPORTING 0
PERSON _______________________________________________________________
(10) SHARED DISPOSITIVE POWER
WITH
3,073,506 (2)
______________________________________________________________________________
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,162,128
______________________________________________________________________________
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[_]
______________________________________________________________________________
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
32.7%
______________________________________________________________________________
(14) TYPE OF REPORTING PERSON*
HC
______________________________________________________________________________
*SEE INSTRUCTIONS BEFORE FILLING OUT
CUSIP No. 4569810C 13D Page 3 of 18 Pages
______________________________________________________________________________
(1) NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
America Online, Inc.
I.R.S. Identification No. - 54-1322110
______________________________________________________________________________
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [_]
(b) [_]
______________________________________________________________________________
(3) SEC USE ONLY
______________________________________________________________________________
(4) SOURCE OF FUNDS*
OO
______________________________________________________________________________
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [_]
______________________________________________________________________________
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
______________________________________________________________________________
(7) SOLE VOTING POWER
NUMBER OF 0
SHARES _______________________________________________________________
(8) SHARED VOTING POWER
BENEFICIALLY
7,162,128 (1)
OWNED BY
_______________________________________________________________
EACH (9) SOLE DISPOSITIVE POWER
REPORTING 0
PERSON _______________________________________________________________
(10) SHARED DISPOSITIVE POWER
WITH
3,073,506 (2)
______________________________________________________________________________
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,162,128
______________________________________________________________________________
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[_]
______________________________________________________________________________
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
32.7%
______________________________________________________________________________
(14) TYPE OF REPORTING PERSON*
CO
______________________________________________________________________________
*SEE INSTRUCTIONS BEFORE FILLING OUT
CUSIP No. 4569810C 13D Page 4 of 18 Pages
(1) 5,729,510 Common Shares, options to acquire 895,118 Common Shares ("Issuer
Options") and warrants to acquire 537,500 Common Shares ("Warrants")
(collectively, the "Securities") of InfoInterActive Inc. (the "Issuer")
covered by this Schedule 13D are subject to (i) a Shareholder Agreement, dated
as of May 18, 2001 (the "Aliant Shareholder Agreement"), among America Online,
Inc. ("America Online"), IAN Acquisition ULC ("Acquiror") and Aliant, Inc.
("Aliant"), (ii) a Shareholder Agreement, dated as of May 18, 2001 (the "Key
Employees Shareholder Agreement" ), among America Online, Acquiror, William
McMullin, Michael Smith, Steve Murphy, Patricia Muzyk, Cheryl Hann, Lisa
Hartling, Liam Keast, David Trueman, Brad Spencer and Eldon Olmstead (such
individuals, collectively, the "Key Employees"), (iii) a Shareholder
Agreement, dated as of May 18, 2001 (the "Intel Shareholder Agreement"), among
America Online, Acquiror, the Issuer and Intel Corporation ("Intel"), (iv) a
Shareholder Agreement, dated as of May 18, 2001 (the "ADC Shareholder
Agreement"), among America Online, Acquiror, ADC Telecommunications Inc.
("ADC") and ADC ESD, Inc. ("ADC Subsidiary"), and (v) a Shareholder Agreement,
dated as of May 18, 2001 (the "Directors Shareholder Agreement," and such
agreements, collectively, the "Shareholder Agreements") among America Online,
Acquiror, Mark Milazzo, William H.R. Smith, Dennis Connor, Tony Van Marken,
Garnet Schulhauser and Bob Krueger (such individuals, collectively, the
"Directors"), pursuant to each of which, among other things, Aliant, the Key
Employees, Intel, ADC, ADC Subsidiary, and the Directors (collectively, the
"Shareholders"), severally and not jointly (except for ADC and ADC
Subsidiary), have agreed to vote (or cause to be voted) all of the Securities
beneficially owned by the Shareholders in favor of the proposed acquisition by
Acquiror of all outstanding Securities of the Issuer pursuant to a statutory
arrangement under the Business Corporations Act (Alberta). AOL Time Warner
Inc. and America Online (collectively, the "Reporting Persons") expressly
disclaim beneficial ownership of any of the Securities covered by the
Shareholder Agreements. Based on the number of Securities outstanding on May
18, 2001, as represented by the Issuer in the Acquisition Agreement, dated as
of May 18, 2001 (the "Acquisition Agreement"), among America Online, Acquiror
and the Issuer, the number of Securities covered by the Shareholder Agreements
represents approximately 32.7% of the outstanding Common Shares on a fully
diluted basis (and approximately 32.7% of the voting power of the outstanding
Common Shares on a fully diluted basis).
(2) 3,073,506 Common Shares are purchasable by America Online upon exercise of
options granted to America Online as of May 18, 2001 on the Securities held by
Aliant and the Key Employees, as described in Items 5 and 6 of this Schedule
13D (collectively, the "Shareholder Options"). Prior to the exercise of each
Shareholder Option, America Online is not entitled to any rights as a
shareholder or optionholder of the Issuer as to the Securities covered by the
Shareholder Options. Each Shareholder Option may only be exercised upon the
happening of certain events referred to in Item 6, none of which has occurred
as of the date hereof. The Reporting Persons expressly disclaim beneficial
ownership of any Common Shares that are purchasable by the Reporting Persons
upon exercise of any Shareholder Options until such time as the Reporting
Persons purchases any such Common Shares upon any such exercise. Based on the
number of Securities outstanding on May 18, 2001, as represented by the Issuer
in the Acquisition Agreement, the number of Securities covered by the
Shareholder Agreements represents approximately 14.0% of the outstanding
Common Shares on a fully diluted basis (and approximately 14.0% of the voting
power of the outstanding Common Shares on a fully diluted basis). The
Securities subject to the Shareholder Options are the same Securities subject
to the voting provisions of the Aliant Shareholder Agreement and the Key
Employees Shareholder Agreement in Note (1) above. The power to vote and to
dispose of these Securities is shared between the Reporting Persons.
CUSIP No. 4569810C 13D Page 5 of 18 Pages
Item 1. Security and Issuer
This initial statement on Schedule 13D (the "Schedule 13D") relates
to the Common Shares, without par value (the "Common Shares"), of
InfoInterActive Inc., an Alberta corporation (the "Issuer"). The address of
the principal executive office of the Issuer is 1550 Bedford Highway, Suite
600, Sun Tower, Bedford, Nova Scotia, B4A 1E6, Canada.
Item 2. Identity and Background
This Schedule 13D is filed by AOL Time Warner Inc., a Delaware
corporation ("AOL Time Warner"), having its principal executive offices at 75
Rockefeller Plaza, New York, New York 10019, and America Online, Inc., a
Delaware corporation ("America Online", and together with AOL Time Warner, the
"Reporting Persons"), having its principal executive offices at 22000 AOL Way,
Dulles, Virginia 20166. As provided in the Joint Filing Agreement filed as
Exhibit 7 hereto, the Reporting Persons have agreed pursuant to Rule 13d-1(k)
of the Securities Exchange Act of 1934, as amended, to file this Schedule 13D
jointly with respect to their beneficial ownership of Common Shares. By reason
of America Online's status as a direct wholly owned subsidiary of AOL Time
Warner, AOL Time Warner may be deemed to beneficially own, in the aggregate,
all of the Common Shares, Issuer Options and Warrants beneficially owned by
America Online.
AOL Time Warner is the first internet powered media and
communications company. Its business interests include: interactive services,
cable systems, publishing, music, cable, and broadcast television networks and
filmed entertainment. Substantially all of AOL Time Warner's interests in
filmed entertainment, most of its interests in cable systems, and a portion of
its interests in cable networks are held through Time Warner Entertainment
Company, L.P., a Delaware limited partnership in which AOL Time Warner has a
majority interest. America Online is a direct, wholly owned subsidiary of AOL
Time Warner. America Online is the world's leader in branded interactive
services and content.
To the best knowledge of the Reporting Persons as of the date
hereof, the name, business address, present principal occupation of employment
and citizenship of each executive officer and director of each Reporting
Person, and the name, principal business and address of any corporation or
other organization in which such employment is conducted is set forth in
Schedules I and II hereto. The information contained in Schedules I and II is
incorporated herein by reference.
During the last five years, none of the Reporting Persons nor, to
the best knowledge of the Reporting Persons, any of their executive officers
or directors listed in Schedules I and II hereto, has been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
has been party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to
a judgment, decree, or final order, enjoining future violations of, or
prohibiting or mandating activities subject to, Federal or state securities
laws or finding any violation with respect to such laws.
CUSIP No. 4569810C 13D Page 6 of 18 Pages
This Schedule 13D is being filed while the Reporting Persons are in
the process of verifying information required herein from their respective
directors and executive officers. If the Reporting Persons obtain information
concerning such individuals which would cause a material change in the
disclosure contained herein, an amendment to this Schedule 13D will be filed
that will disclose such change.
Item 3. Source and Amount of Funds or Other Consideration
The information set forth, or incorporated by reference, in Items 4
through 6 is hereby incorporated herein by reference. Except as disclosed
herein, the Reporting Persons did not pay additional consideration to Aliant
(as defined in Item 6) or the Key Employees (as defined in Item 6) in
connection with obtaining the Aliant Option (as defined in Item 6) or the Key
Employee Options (as defined in Item 6), respectively, and the Reporting
Persons did not pay additional consideration to Aliant, the Key Employees,
Intel (as defined in Item 6), ADC (as defined in Item 6), ADC Subsidiary (as
defined in Item 6), or the Directors (as defined in Item 6) (collectively, the
"Shareholders") in connection with entering into the Shareholder Agreements
(as defined in Item 6). If America Online elects to exercise the Aliant Option
or the Key Employee Options, America Online currently expects to pay the
exercise price thereunder from its working capital.
Item 4. Purpose of the Transaction.
(a) - (j) America Online entered into an Acquisition Agreement,
dated as of May 18, 2001 (the "Acquisition Agreement"), with the Issuer and
IAN Acquisition ULC, a Nova Scotia unlimited liability company and an indirect
wholly owned subsidiary of America Online ("Acquiror"), providing for, among
other things, the acquisition of all of the outstanding Common Shares (the
"Arrangement") by Acquiror pursuant to a statutory arrangement under the
Business Corporations Act (Alberta) in accordance with the terms and
conditions of the Acquisition Agreement. The Arrangement is subject to
approval by holders of the Issuer's Common Shares, options to acquire Common
Shares granted under the Issuer's Stock Option Plans (as defined in the
Acquisition Agreement) ("Issuer Options"), and warrants to acquire Common
Shares pursuant to the Warrant Indenture, dated as of September 3, 1999,
between the Issuer and Montreal Trust Company of Canada (the "Warrants"). In
addition, the Arrangement is also subject to required court and regulatory
approvals and the satisfaction or waiver of certain other conditions as more
fully described in the Acquisition Agreement. As used herein, the term
"Securities" refers to the Common Shares, Issuer Options and Warrants of the
Issuer, collectively.
Pursuant to the Acquisition Agreement, and subject to the conditions
described therein, the Reporting Persons through Acquiror will acquire
beneficial ownership of all of the Common Shares of the Issuer in the
Arrangement. Upon consummation of the Arrangement, (i) the Issuer will become
an indirect wholly-owned subsidiary of the Reporting Persons, (ii) the Common
Shares will no longer be publicly traded on any stock exchanges in Canada or
the United States, (iii) the Board of Directors of the Issuer will be replaced
by persons chosen by or on behalf of the Reporting Persons, and (iv) the
Issuer's charter and bylaws may be amended by the Acquiror as its sole
shareholder. In addition, America Online currently intends to cause,
CUSIP No. 4569810C 13D Page 7 of 18 Pages
upon the consummation of the Arrangement, the Issuer to (i) be continued from
Alberta to Nova Scotia in accordance with applicable Canadian law such that
upon consummation of such continuance, the Issuer will be governed by Nova
Scotia law, and (ii) to amalgamate with Acquiror or an affiliate of Acquiror
in accordance with Nova Scotia law.
America Online and Acquiror also entered into certain Shareholder
Agreements (as defined in Item 6) to support the Arrangement. These
Shareholder Agreements are discussed specifically in Items 5 and 6, and the
information set forth in Items 5 and 6 is hereby incorporated herein by
reference.
References to, and descriptions of, the Acquisition Agreement and
the Shareholder Agreements as set forth in this Item 4 are qualified in their
entirety by reference to the copies of the Acquisition Agreement and the
Shareholder Agreements included as Exhibits 1 through 6, respectively, to this
Schedule 13D, and are incorporated in this Item 4 in their entirety where such
references and descriptions appear.
Item 5. Interest in Securities of the Issuer.
The information set forth, or incorporated by reference, in Items 4
and 6 is hereby incorporated by reference.
With respect to the Aliant Shareholder Agreement (as defined in Item
6) and the Key Employees Shareholder Agreement (as defined in Item 6), the
aggregate number of Securities covered by these Shareholder Agreements is
2,378,388 Common Shares and 695,118 Issuer Options, which constitutes, based
on the number of Securities outstanding on May 18, 2001 as represented by the
Issuer in the Acquisition Agreement, in the aggregate, approximately 14.0% of
the outstanding Common Shares on a fully diluted basis (or approximately 14.0%
of the voting power of the outstanding Common Shares on a fully diluted
basis). These Securities are subject to the Aliant Option and the Key Employee
Options.
With respect to the Intel Shareholder Agreement (as defined in Item
6), the ADC Shareholder Agreement (as defined in Item 6) and the Directors
Shareholder Agreement (as defined in Item 6), the aggregate number of
Securities covered by these Shareholder Agreements is 3,351,122 Common Shares,
200,000 Issuer Options and 537,500 Warrants, which constitutes, based on the
number of Securities outstanding on May 18, 2001 as represented by the Issuer
in the Acquisition Agreement, in the aggregate, approximately 18.7% of the
outstanding Common Shares on a fully diluted basis (and approximately 18.7% of
the voting power of the outstanding Common Shares on a fully diluted basis).
In total, the aggregate number of Securities covered by all of the
Shareholder Agreements is 7,162,128, which constitutes, based on the number of
Securities outstanding on May 18, 2001 as represented by the Issuer in the
Acquisition Agreement, approximately 32.7% of the outstanding Common Shares on
a fully diluted basis (and approximately 32.7% of the voting power of the
outstanding Common Shares on a fully diluted basis).
CUSIP No. 4569810C 13D Page 8 of 18 Pages
By virtue of the Aliant Shareholder Agreement and Key Employees
Shareholder Agreement, the Reporting Persons may be deemed to share with
Aliant (as defined in Item 6) and the Key Employees (as defined in Item 6) the
power to vote the Common Shares and Issuer Options covered by these
Shareholder Agreements. However, prior to the exercise of the Aliant Option or
the Key Employee Option, the Reporting Persons (i) are not entitled to any
rights as holders of the Common Shares or the Issuer Options covered by these
Shareholder Agreements and (ii) expressly disclaim any beneficial ownership of
Common Shares and Issuer Options covered by these Shareholder Agreements.
In addition, by virtue of the Aliant Option and the Key Employee
Options, the Reporting Persons may be deemed to share the power to dispose of
these Common Shares and Issuer Options with Aliant and the Key Employees.
However, the Reporting Persons further expressly disclaim any beneficial
ownership of Common Shares and Issuer Options which the Reporting Persons may
have because of the existence of the Aliant Option or the Key Employee
Options, because the Aliant Option and the Key Employee Options are
exercisable only in the limited circumstances referred to in Item 6 below, and
none of these limited circumstances has occurred as of the date hereof. If the
Aliant Option or the Key Employee Options were to be exercised, the Reporting
Persons would have the sole right to dispose of and to vote the Common Shares
delivered as a result of such exercise. The power to vote and to dispose of
these Securities is shared between the Reporting Persons. See the information
in Item 6 below with respect to the Aliant Shareholder Agreement and Key
Employees Shareholder Agreement, which information is incorporated herein by
reference.
By virtue of the Intel Shareholder Agreement, the ADC Shareholder
Agreement and the Directors Shareholder Agreement, the Reporting Persons may
be deemed to share with Intel (as defined in Item 6), ADC (as defined in Item
6), ADC Subsidiary (as defined in Item 6), and the Directors (as defined in
Item 6) the power to vote the Common Shares, Issuer Options and Warrants
subject to their respective Shareholder Agreements. However, the Reporting
Persons (i) are not entitled to any rights as holders of the Common Shares,
Issuer Options and Warrants subject to these Shareholder Agreements and (ii)
expressly disclaim any beneficial ownership of the Common Shares, Issuer
Options and Warrants covered by these Shareholder Agreements. See the
information in Item 6 with respect to Intel, ADC, ADC Subsidiary, the
Directors and their respective Shareholder Agreements, which information is
incorporated herein by reference.
This Schedule 13D is being filed while the Reporting Persons are in
the process of verifying information required herein from their respective
directors and executive officers. If the Reporting Persons obtain information
concerning such individuals which would cause a material change in the
disclosure contained herein, an amendment to this Schedule 13D will be filed
that will disclose such change.
Other than as set forth in this Item 5 and subject to the
immediately preceding paragraph, to the best of the Reporting Persons'
knowledge as of the date hereof (i) neither the Reporting Persons nor any of
the Reporting Persons' executive officers or directors, beneficially own any
Common Shares, Issuer Options or Warrants, and (ii) there have been no
transactions in Common Shares, Issuer Options or Warrants effected during the
past 60 days by the Reporting
CUSIP No. 4569810C 13D Page 9 of 18 Pages
Persons, nor to the best of the Reporting Persons' knowledge, by any of the
Reporting Persons' executive officers or directors.
No other person is known by the Reporting Persons to have the right
to receive or the power to direct the receipt of dividends from, or the
proceeds from the sale of, the Common Shares obtainable by the Reporting
Persons upon exercise of the Aliant Option and the Key Employee Options.
References to, and descriptions of, the Shareholder Agreements as
set forth above in this Item 5 are qualified in their entirety by reference to
the copies of the Shareholder Agreements included as Exhibits 2 through 6 to
this Schedule 13D, and are incorporated in this Item 5 in their entirety where
such references and descriptions appear.
Item 6. Contracts, Arrangements, Understandings or Relationships
with Respect to Securities of the Issuer.
The information set forth, or incorporated by reference, in Items 4
and 5 is hereby incorporated by reference.
In support of the Arrangement contemplated by the Acquisition
Agreement entered into by America Online and Acquiror with the Issuer, America
Online and Acquiror entered into two Shareholder Agreements pursuant to which
options were granted to America Online to acquire, upon the terms and
conditions specified therein, the Securities subject to such options and
pursuant to which the other parties thereto agreed to vote the Securities
beneficially owned by them in favor of the Arrangement, as more fully
described below.
As a condition to the willingness of, and as an inducement to,
America Online and Acquiror to enter into the Acquisition Agreement, America
Online and Acquiror entered into a Shareholder Agreement, dated as of May 18,
2001 (the "Aliant Shareholder Agreement"), with Aliant, Inc. ("Aliant"),
whereby Aliant granted to America Online an option (the "Aliant Option") to
acquire, under certain circumstances described therein, all of the Securities
beneficially owned by it at a purchase price per share equal to $1.42 per
share, subject to adjustment as provided therein. In addition, subject to
certain terms and conditions, Aliant agreed to vote all of the Securities
beneficially owned by it in favor of the approval, adoption, consent and
ratification of the Arrangement, the Acquisition Agreement, and the Plan of
Arrangement thereunder. As of May 18, 2001, the Aliant Shareholder Agreement
covered an aggregate of 1,091,667 Common Shares, which represents
approximately 5.0% of the outstanding Common Shares on a fully diluted basis
(and approximately 5.0% of the voting power of the outstanding Common Shares
on a fully diluted basis). America Online did not pay additional consideration
to Aliant in connection with Aliant entering into the Aliant Shareholder
Agreement and granting the Aliant Option.
Upon the terms and subject to the conditions set forth in the Aliant
Shareholder Agreement, America Online may exercise the Aliant Option
commencing upon the "Exercise Date" and prior to the "Expiration Date," and
effective upon the execution of the Aliant Shareholder Agreement and until the
"Expiration Date," Aliant is obligated to vote all of the
CUSIP No. 4569810C 13D Page 10 of 18 Pages
Securities beneficially owned by it in favor of the approval, adoption,
consent and ratification of the Arrangement, the Acquisition Agreement, and
the Plan of Arrangement thereunder. As used therein, the "Exercise Date" means
the first to occur of (i) any event or condition as a result of which America
Online would be entitled to terminate the Acquisition Agreement pursuant to
Section 8.1(d) (provided that with respect to Section 8.1(d), at the time of
such termination, a Competing Proposal (as defined in the Acquisition
Agreement) has been publicly announced or is generally known by the Issuer's
shareholders), Section 8.1(e), or Section 8.1(f) or otherwise to receive the
Termination Fee (as defined in the Acquisition Agreement) pursuant to Section
8.3(b) of the Acquisition Agreement (in each case, whether or not the
Acquisition Agreement is terminated) or (ii) any material breach by Aliant of
any provision of the Aliant Shareholder Agreement. As used therein, the term
"Expiration Date" means the first to occur of (i) the Effective Time of the
Arrangement (the "Effective Time"), (ii) receipt by Aliant of written notice
of termination of the Aliant Shareholder Agreement by America Online, or (iii)
September 30, 2001.
As a condition to the willingness of, and as an inducement to,
America Online and Acquiror to enter into the Acquisition Agreement, America
Online and Acquiror entered into a Shareholder Agreement, dated as of May 18,
2001 (the "Key Employees Shareholder Agreement"), with William McMullin,
Michael Smith, Steve Murphy, Patricia Muzyk, Cheryl Hann, Lisa Hartling, Liam
Keast, David Trueman, Brad Spencer and Eldon Olmstead (collectively, the "Key
Employees"), whereby the Key Employees each granted to America Online an
option (collectively, the "Key Employee Options") to acquire, under certain
circumstances described therein, all of the Securities beneficially owned by
them at a purchase price per share equal to $1.42 per share, subject to
adjustment as provided therein. In addition, subject to certain terms and
conditions, each Key Employee agreed to vote all of the Securities
beneficially owned by such person in favor of the approval, adoption, consent
and ratification of the Arrangement, the Acquisition Agreement, and the Plan
of Arrangement thereunder. As of May 18, 2001, the Key Employees Shareholder
Agreement covered an aggregate of 1,286,721 Common Shares and 695,118 Issuer
Options, which represents approximately 9.1% of the outstanding Common Shares
on a fully diluted basis (and approximately 9.1% of the voting power of the
outstanding Common Shares on a fully diluted basis). America Online did not
pay additional consideration to the Key Employees in connection with the Key
Employees entering into the Key Employees Shareholder Agreement and granting
the Key Employee Options.
Upon the terms and subject to the conditions set forth in the Key
Employees Shareholder Agreement, America Online may exercise the Key Employee
Option commencing upon the "Exercise Date" and prior to the "Expiration Date,"
and effective upon execution of the Key Employees Shareholder Agreement and
until the "Expiration Date," the Key Employees are obligated to vote all of
the Securities beneficially owned by them in favor of the approval, adoption,
consent and ratification of the Arrangement, the Acquisition Agreement, and
the Plan of Arrangement thereunder. As used therein, the "Exercise Date" means
the first to occur of (i) any event or condition as a result of which America
Online would be entitled to terminate the Acquisition Agreement pursuant to
Section 8.1(d) (provided that with respect to Section 8.1(d), at the time of
such termination, a Competing Proposal has been publicly announced or is
generally known by the Issuer's shareholders), Section 8.1(e), or Section
8.1(f) or otherwise to receive the Termination Fee pursuant to Section 8.3(b)
of the Acquisition Agreement (in each
CUSIP No. 4569810C 13D Page 11 of 18 Pages
case, whether or not the Acquisition Agreement is terminated) or (ii) with
respect to the Key Employee Options from any particular Key Employee, any
material breach by such Key Employee of any provision of the Key Employees
Shareholder Agreement. As used therein, the term "Expiration Date" means the
first to occur of (i) the Effective Time, (ii) with respect to any Key
Employee, receipt by such Key Employee of written notice of termination of the
Key Employees Shareholder Agreement by America Online, or (iii) the date that
is thirteen months from the date of termination of the Acquisition Agreement.
In addition to the Aliant Shareholder Agreement and the Key
Employees Shareholder Agreement, America Online and Acquiror also entered into
three other Shareholder Agreements relating to the voting of Securities, but
without the grant of any option to America Online to acquire Securities, each
as described below.
As a condition to the willingness of, and as an inducement to,
America Online and Acquiror to enter into the Acquisition Agreement, America
Online and Acquiror entered into a Shareholder Agreement, dated as of May 18,
2001 (the "Intel Shareholder Agreement"), with the Issuer and Intel
Corporation, a Delaware corporation ("Intel"). Pursuant to the Intel
Shareholder Agreement and subject to the terms and conditions thereof, Intel
agreed to vote all of the Securities beneficially owned by it in favor of the
approval, adoption, consent and ratification of the Arrangement, the
Acquisition Agreement, and the Plan of Arrangement thereunder. As of May 18,
2001, the Intel Agreement covered an aggregate of 1,803,922 Common Shares,
which represents approximately 8.2% of the outstanding Common Shares on a
fully diluted basis (and approximately 8.2% of the voting power of the
outstanding Common Shares on a fully diluted basis). America Online did not
pay additional consideration to Intel in connection with the execution and
delivery of the Intel Shareholder Agreement.
Effective upon the execution of the Intel Shareholder Agreement and
subject to the other terms and conditions thereof, Intel is obligated to vote
all of the Securities beneficially owned by it in favor of the approval,
adoption, consent and ratification of the Arrangement, the Acquisition
Agreement, and the Plan of Arrangement thereunder, until the Intel Shareholder
Agreement terminates upon the first to occur of (i) the Effective Time, (ii)
receipt by Intel of written notice of termination of the Intel Shareholder
Agreement by America Online, (iii) the termination of the Acquisition
Agreement, (iv) at the election of Intel, if either America Online or Acquiror
commits a material breach of any provision of the Intel Shareholder Agreement
upon written notice by Intel to America Online and Acquiror, (v) 150 days
after the date of execution thereof, and (vi) upon any material change to the
Plan of Arrangement or the Acquisition Agreement, in either case in a manner
that is adverse to Intel and except for changes contemplated by Section 2.3 of
the Acquisition Agreement.
As a condition to the willingness of, and as an inducement to,
America Online and Acquiror to enter into the Acquisition Agreement, America
Online and Acquiror entered into a Shareholder Agreement, dated as of May 18,
2001 (the "ADC Shareholder Agreement"), with ADC Telecommunications Inc., a
Minnesota corporation ("ADC"), and ADC ESD, Inc., a Delaware corporation and a
wholly-owned subsidiary of ADC ("ADC Subsidiary"). Pursuant to the ADC
Shareholder Agreement and subject to the terms and conditions thereof, ADC and
ADC Subsidiary each agreed to vote all of the Securities beneficially owned by
them in favor of the
CUSIP No. 4569810C 13D Page 12 of 18 Pages
approval, adoption, consent and ratification of the Arrangement, the
Acquisition Agreement, and the Plan of Arrangement thereunder. As of May 18,
2001, the ADC Agreement covered an aggregate of 1,475,000 Common Shares and
537,500 Warrants, which represents in the aggregate approximately 9.2% of the
outstanding Common Shares on a fully diluted basis (and approximately 9.2% of
the voting power of the outstanding Common Shares on a fully diluted basis).
America Online did not pay additional consideration to ADC or ADC Subsidiary
in connection with the execution and delivery of the ADC Shareholder
Agreement.
Effective upon the execution of the ADC Shareholder Agreement and
subject to the other terms and conditions thereof, ADC and ADC Subsidiary are
obligated to vote all of the Securities beneficially owned by them in favor of
the approval, adoption, consent and ratification of the Arrangement, the
Acquisition Agreement and the Plan of Arrangement thereunder, until the ADC
Shareholder Agreement terminates upon the first to occur of (i) the Effective
Time, (ii) receipt by ADC and ADC Subsidiary of written notice of termination
of the ADC Shareholder Agreement by America Online, or (iii) the date of the
termination of the Acquisition Agreement.
As a condition to the willingness of, and as an inducement to,
America Online and Acquiror to enter into the Acquisition Agreement, America
Online and Acquiror entered into a Shareholder Agreement, dated as of May 18,
2001 (the "Directors Shareholder Agreement") with Mark Milazzo, William H.R.
Smith, Dennis Connor, Tony Van Marken, Garnet Schulhauser and Bob Krueger,
each of whom is a member of the Board of Directors of the Issuer
(collectively, the "Directors"). Pursuant to the Directors Shareholder
Agreement and subject to the terms and conditions thereof, the Directors each
agreed to vote all of the Securities beneficially owned by them in favor of
the approval, adoption, consent and ratification of the Arrangement, the
Acquisition Agreement, and the Plan of Arrangement thereunder. As of May 18,
2001, the Directors Agreement covered an aggregate of 72,200 Common Shares and
200,000 Issuer Options, which represents in the aggregate approximately 1.2%
of the outstanding Common Shares on a fully diluted basis (and approximately
1.2% of the voting power of the outstanding Common Shares on a fully diluted
basis). America Online did not pay additional consideration to the Directors
in connection with the execution and delivery of the Directors Shareholder
Agreement.
Effective upon the execution of the Directors Shareholder Agreement
and subject to the other terms and conditions thereof, the Directors are
obligated to vote all of the Securities beneficially owned by them in favor of
the approval, adoption, consent and ratification of the Arrangement, the
Acquisition Agreement and the Plan of Arrangement thereunder, until the
Directors Shareholder Agreement terminates upon the first to occur of (i) the
Effective Time, (ii) with respect to any Director, receipt by such Director of
written notice of termination of the Directors Shareholder Agreement by
America Online, or (iii) the date of termination of the Acquisition Agreement.
References to, and descriptions of, the Aliant Shareholder
Agreement, the Key Employees Shareholder Agreement, the Intel Shareholder
Agreement, the ADC Shareholder Agreement, and the Directors Shareholder
Agreement (collectively, the "Shareholder Agreements") and the Acquisition
Agreement as set forth above in this Item 6 are qualified in their entirety by
reference to the copies of the Shareholder Agreements and the Acquisition
CUSIP No. 4569810C 13D Page 13 of 18 Pages
Agreement included as Exhibits 1 through 6, respectively, to this Schedule
13D, and are incorporated in this Item 6 in their entirety where such
references and descriptions appear.
The number of Securities covered by a Shareholder Agreement and the
percentage that such number of Securities represents of the Common Shares of
the Issuer on a fully diluted basis are based upon the representations of the
relevant parties in the Shareholder Agreements and the representations of the
Issuer in the Acquisition Agreement, respectively, in each case as of May 18,
2001. Capitalized terms used in Item 6 but not otherwise defined herein have
the respective meanings assigned to them in the Acquisition Agreement.
To the best of each Reporting Person's knowledge, except as
described in this Schedule 13D, there are at present no other material
contracts, arrangements, understandings or relationships among the persons
named in Item 2 above, and between any such persons and any person, with
respect to the Securities of the Issuer.
Item 7. Material to be filed as Exhibits.
INDEX OF EXHIBITS
Description
-----------
Exhibit 1 Acquisition Agreement, dated as of May 18, 2001,
among America Online, the Issuer and the Acquiror.
Exhibit 2 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror and Aliant.
Exhibit 3 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror and the Key
Employees.
Exhibit 4 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror, the Issuer and
Intel.
Exhibit 5 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror, ADC, and ADC
Subsidiary.
Exhibit 6 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror and the
Directors.
Exhibit 7 Joint Filing Agreement dated as of May 29, 2001,
among the Reporting Persons relating to the filing
of a joint statement on Schedule 13D.
CUSIP No. 4569810C 13D Page 14 of 18 Pages
SIGNATURES
After reasonable inquiry and to the best of his or its knowledge and
belief, each of the undersigned certifies that the information set forth in
this statement is true, complete and correct.
Dated: May 29, 2001
AOL TIME WARNER INC.
By: /s/ J. Michael Kelly
--------------------
Name: J. Michael Kelly
Title: Executive Vice President
and Chief Financial Officer
AMERICA ONLINE, INC.
By: /s/ Joseph A. Ripp
-------------------
Name: Joseph A. Ripp
Title: Executive Vice President,
Chief Financial Officer
and Treasurer
CUSIP No. 4569810C 13D Page 15 of 18 Pages
INDEX OF EXHIBITS
Description
-----------
Exhibit 1 Acquisition Agreement, dated as of May 18, 2001,
among America Online, the Issuer and the Acquiror.
Exhibit 2 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror and Aliant.
Exhibit 3 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror and the Key
Employees.
Exhibit 4 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror, the Issuer and
Intel.
Exhibit 5 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror, ADC, and ADC
Subsidiary.
Exhibit 6 Shareholder Agreement, dated as of May 18, 2001,
among America Online, the Acquiror and the
Directors.
Exhibit 7 Joint Filing Agreement dated as of May 29, 2001,
among the Reporting Persons relating to the filing
of a joint statement on Schedule 13D.
CUSIP No. 4569810C 13D Page 16 of 18 Pages
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF AOL TIME WARNER
The following table sets forth the name, business address and
present principal occupation or employment of each director and executive
officer of AOL Time Warner. Except as indicated below, each such person is a
U.S. citizen, and the business address of each such person is 75 Rockefeller
Plaza, New York, New York 10019.
Board of Directors
------------------
Name Present Principal Occupation
---- ----------------------------
Stephen M. Case Chairman of the Board, AOL Time Warner Inc.
Gerald M. Levin Chief Executive Officer, AOL Time Warner Inc.
Kenneth J. Novack Vice Chairman, AOL Time Warner Inc.
R.E. Turner Vice Chairman and Senior Advisor, AOL Time Warner
Inc.
Daniel F. Akerson Chairman of the Board and Chief Executive Officer;
XO Communications, Inc.; 11111 Sunset Hills Road;
Reston, VA 20190 (a broadband and communications
company)
James L. Barksdale Partner; The Barksdale Group c/o AOL Time Warner Inc.
(a venture capital firm)
Stephen F. Bollenbach President and Chief Executive Officer; Hilton Hotels
Corporation; 9336 Civic Center Drive; Beverly Hills,
CA 90210
Frank J. Caufield Partner; Kleiner Perkins Caufield & Byers; Four
Embarcadero Center; San Francisco, CA 94111 (a
venture capital partnership)
Miles R. Gilburne Director; AOL Time Warner Inc.
Carla A. Hills Chairman and Chief Executive Officer; Hills &
Company; 1200 19th Street, NW; Washington, DC 20036
(international trade and investment consultants)
Reuben Mark Chief Executive Officer; Colgate-Palmolive Company;
300 Park Avenue; New York, NY 10022 (consumer
products)
CUSIP No. 4569810C 13D Page 17 of 18 Pages
Michael A. Miles Former Chairman of the Board and Chief Executive
Officer of Phillip Morris Companies Inc.; Director
of Various Companies; Three Lakes Drive; Northfield,
IL 60093
Richard D. Parsons Co-Chief Operating Officer, AOL Time Warner Inc.
Robert W. Pittman Co-Chief Operating Officer, AOL Time Warner Inc.
Franklin D. Raines Chairman and Chief Executive Officer; Fannie Mae;
3900 Wisconsin Avenue NW; Washington, DC 20016-2806
(a non-banking financial services company)
Francis T. Vincent, Jr. Chairman of Vincent Enterprises (private Investor)
and Director of Various Companies; 300 First Stamford
Place; Stamford, CT 06902
Executive Officers Who Are Not Directors
----------------------------------------
Name Title and Present Principal Occupation
---- --------------------------------------
Paul T. Cappuccio Executive Vice President, General Counsel and
Secretary; AOL Time Warner Inc.
David Colburn Executive Vice President; AOL Time Warner Inc.
Adolf DiBiasio Executive Vice President, Strategy & Investments;
AOL Time Warner Inc.
J. Michael Kelly Executive Vice President and Chief Financial
Officer; AOL Time Warner Inc.
Kenneth B. Lerer Executive Vice President; AOL Time Warner Inc.
William J. Raduchel Executive Vice President and Chief Technology
Officer; AOL Time Warner Inc.
Mayo S. Stuntz, Jr. Executive Vice President; AOL Time Warner Inc.
George Vradenburg, III Executive Vice President for Global and Strategic
Policy; AOL Time Warner Inc.
CUSIP No. 4569810C 13D Page 18 of 18 Pages
SCHEDULE II
DIRECTORS AND EXECUTIVE OFFICERS OF AMERICA ONLINE, INC.
The following table sets forth the name, business address and
present principal occupation or employment of each director and executive
officer of America Online, Inc. Unless otherwise noted, each such person is a
U.S. citizen, and the business address of each such person is 75 Rockefeller
Plaza, New York, New York 10019.
Board of Directors Present Principal Occupation
------------------ ----------------------------
Name and Title
--------------
Paul T. Cappuccio Executive Vice President, General Counsel and
Secretary; AOL Time Warner Inc.
J. Michael Kelly Executive Vice President and Chief Financial
Officer; AOL Time Warner, Inc.
Barry M. Schuler Chairman and Chief Executive Officer, America
Online, Inc.
Executive Officers Who Are Not Directors
----------------------------------------
Name Title and Present Principal Occupation
---- --------------------------------------
Janice Brandt Vice Chair and Chief Marketing Officer;
America Online, Inc.
Theodore J. Leonsis Vice Chair and New Product Officer;
America Online, Inc.
Raymond J. Oglethorpe President; America Online, Inc.
Joseph A. Ripp Executive Vice President, Chief Financial Officer
and Treasurer; America Online, Inc.
Mark E. Stavish Executive Vice President, Human Resources; America
Online, Inc.
Randall J. Boe Senior Vice President, General Counsel and
Secretary; America Online, Inc.
Ann Brackbill Senior Vice President, Corporate Communications;
America Online, Inc.