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)
March 30, 2005
EASYLINK SERVICES CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 000-26371 13-3787073
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation) Identification No.)
33 Knightsbridge Road
Piscataway, NJ 08854
(Address of principal executive offices)
Registrant's telephone number, including area code: (732) 652-3500
N/A
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Former Name or Former Address, if Changed Since Last Report
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01 (Entry into a Material Definitive Agreement)
Amendment to Credit Facility
On March 31, 2005, the Company and its direct and indirect subsidiaries Swift
Telecommunications, Inc., EasyLink Services International, Inc. and EasyLink
Services USA, Inc. entered into an amendment to their credit agreement with
Wells Fargo Foothill, Inc. The Company's credit agreement with Wells Fargo
Foothill, Inc. requires the Company to maintain minimum levels of EBITDA for
specified periods. The amendment changes the definition of EBITDA to exclude the
impact of the separation agreement with George Abi Zeid from the calculation of
EBITDA. Accordingly, approximately $2.5 million of charges expected to be
recorded as expense in the first quarter of 2005 will be excluded from the
calculation of EBITDA under the credit agreement. The form of the amendment is
included in this filing as Exhibit 10.1 and is incorporated by reference herein.
The credit agreement, including Schedule 1.1 thereto which contains the
definition of EBITDA, is filed as Exhibit 10.1 to the Company's Current Report
on Form 8-K filed December 20, 2004 and is incorporated by reference herein. The
foregoing summary of the terms of the amendment and certain terms of the credit
agreement is not complete and is qualified in its entirety by reference to
Exhibit 10.1 to this filing and Exhibit 10.1 to the Form 8-K filed December 20,
2004.
Employment Arrangement
On March 30, 2005, the Company entered into an agreement with Debra McClister,
the former Chief Financial Officer of the Company. Under the agreement, Ms.
McClister will remain employed by the Company through December 31, 2005. From
April 16, 2004 through April 16, 2005, Ms. McClister received salary
continuation based on 50% of her previous base salary, $207,000. From April 16,
2005, she will be entitled to receive salary continuation until July 16, 2006
based on 100% of her previous base salary. She will also be entitled to
reimbursement for up to an aggregate of $30,000 of out of pocket expenses
relating to maintaining her CPA license and outplacement services.
The form of the agreement is included in this filing as Exhibit 10.2 and is
incorporated by reference herein. The foregoing summary of the terms of the
agreement is not complete and is qualified in its entirety by reference to
Exhibit 10.2.
ITEM 5.03 (Amendments to Articles of Incorporation or Bylaws;
Change in Fiscal Year)
Amended and Restated Bylaws
On March 30, 2005, the board of directors of the Company adopted amended and
restated bylaws. The amended and restated bylaws implement the following changes
to the bylaws, which are effective immediately:
Section 1.9 has been revised to conform the procedures for examination of the
record stockholder list to current Delaware law.
Section 1.11 sets forth procedures for the conduct of meetings of stockholders.
Section 1.12 sets forth procedures for advance notice of stockholder proposals
(including nominations) to be considered at annual and special meetings. For the
2005 annual meeting, a stockholder must provide notice of a proposal or
nomination not earlier than 90 days and not later than 60 days prior to the
meeting. The Company has scheduled the 2005 annual meeting for June 21, 2005.
For the 2006 annual meeting and subsequent annual meetings, a stockholder must
provide notice of a proposal or nomination not earlier than 120 days and not
later than 90 days prior to the first anniversary of the preceding year's annual
meeting. If the date of the annual meeting is more than thirty (30) days before
or more than seventy (70) days after the first anniversary date, notice by the
stockholder must be delivered not earlier than the 120 days prior to the actual
date of the annual meeting and not later than 90 days prior to such annual
meeting. In any event, stockholders would have at least until 10 days following
the day on which public announcement of the date of such meeting is first made
by the Corporation to submit notice of proposed business or nominations. For
special meetings, notice must be provided not earlier than the 120 days prior to
the meeting and not later than 90 days prior to the meeting. Again, stockholders
would have in any event at least until ten days following the day on which
public announcement of the date of a special meeting is first made by the
Corporation to submit nominations.
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Section 1.12 also specifies the information that must be included in the notice.
Section 2.1 of the bylaws permits the board to fix the number of directors by
resolution. The Board previously fixed the number of directors at seven. Section
2.1 has been revised to conform the stated number of directors in Section 2.1
from eight to the current number fixed by resolution (seven).
The form of the amended and restated bylaws is included in this filing as
Exhibit 10.3 and is incorporated by reference herein. The foregoing summary of
the terms of the revised bylaws is not complete and is qualified in its entirety
by reference to Exhibit 10.3.
ITEM 9.01 (C) Exhibits.
The following exhibits are filed herewith:
EXHIBIT NO. DESCRIPTION
Exhibit 10.1 First Amendment to Credit Agreement entered into
as of March 30, 2005 by and among Wells Fargo
Foothill, Inc., EasyLink Services Corporation,
Swift Telecommunications, Inc., EasyLink Services
USA, Inc. and EasyLink Services International,
Inc.
Exhibit 10.2 Letter Agreement between EasyLink Services
Corporation and Debra McClister dated March 30,
2005.
Exhibit 10.3 By-Laws
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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 hereunto duly authorized.
Dated: April 5, 2005
EASYLINK SERVICES CORPORATION
By: s/Thomas Murawski
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Thomas Murawski, President and Chief Executive Officer
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INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
Exhibit 10.1 First Amendment to Credit Agreement entered into
as of March 30, 2005 by and among Wells Fargo
Foothill, Inc., EasyLink Services Corporation,
Swift Telecommunications, Inc., EasyLink Services
USA, Inc. and EasyLink Services International,
Inc.
Exhibit 10.2 Letter Agreement between EasyLink Services
Corporation and Debra McClister dated March 30,
2005.
Exhibit 10.3 By-Laws
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