EXHIBIT (a)(9)
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell Shares (as defined below). The Offer (as defined below) is made
only by the Offer to Purchase, dated February 1, 2001, and the related Letter of
Transmittal and any amendments or supplements thereto, and is being made to all
holders of Shares. The Offer is not being made to (nor will tenders be accepted
from or on behalf of) holders of Shares in any jurisdiction in which the making
of the Offer or the acceptance thereof would not be in compliance with the
securities, "blue sky" or other laws of such jurisdiction. However, the
Purchaser (as defined below) may, in its discretion, take such action as it may
deem necessary to make the Offer in any jurisdiction and extend the Offer to
holders of Shares in such jurisdiction. In those jurisdictions where securities,
blue sky or other laws require the Offer to be made by a licensed broker or
dealer, the Offer shall be deemed to be made on behalf of the Purchaser by one
or more registered brokers or dealers licensed under the laws of such
jurisdiction to be designated by Purchaser.
NOTICE OF OFFER TO PURCHASE FOR CASH
ALL OF THE OUTSTANDING SHARES OF COMMON STOCK
of
Telocity Delaware, Inc.
at
$2.15 Net Per Share
by
DIRECTV Broadband Inc.,
a wholly owned subsidiary of
Hughes Electronics Corporation
DIRECTV Broadband Inc., a Delaware corporation (the "Purchaser"), and a
wholly owned subsidiary of Hughes Electronics Corporation ("Hughes"), a Delaware
corporation, hereby offers to purchase all outstanding shares of common stock,
par value $.001 per share (the "Common Stock"), of Telocity Delaware, Inc., a
Delaware corporation ("Telocity") (the shares of Common Stock are referred to as
the "Shares"), at a price of $2.15 per Share, net to the seller in cash, without
interest thereon (the "Offer Price"), upon the terms and subject to the
conditions set forth in the Offer to Purchase dated February 1, 2001 (the "Offer
to Purchase"), and in the related Letter of Transmittal (which, together with
any amendments or supplements thereto, collectively constitute the "Offer").
Tendering stockholders who are record owners of their Shares and tender directly
to EquiServe Trust Company, N.A., (the "Depositary") will not be obligated to
pay brokerage fees or commissions or, except as otherwise provided in
Instruction 6 of the Letter of Transmittal, stock transfer taxes on the purchase
of Shares by the Purchaser pursuant to the Offer. Stockholders who hold their
Shares through a broker or bank should consult such institution as to whether it
charges any service fees. The Purchaser will pay all charges and expenses of
the Depositary and Morrow & Co., Inc., which is acting as the information agent
(the "Information Agent"), incurred in connection with the Offer. Following the
consummation of the Offer, the Purchaser intends to effect the Merger described
below.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
MONDAY, APRIL 2, 2001, UNLESS THE OFFER IS EXTENDED.
The Offer is conditioned upon, among other things, (i) there being validly
tendered in accordance with the terms of the Offer and not withdrawn prior to
the expiration date of the Offer that number of Shares that represents at least
a majority of the outstanding shares of
Common Stock on a fully diluted basis (assuming the exercise of all outstanding
options and warrants to purchase shares of Common Stock that are then
exercisable and any other rights to acquire shares of Common Stock on the date
of purchase) (collectively, the "Minimum Condition"), and (ii) any applicable
waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended (the "HSR Act") (and any extension thereof) having expired or been
terminated prior to the expiration of the Offer. The Offer is also subject to
the satisfaction of certain other conditions, which are more fully described in
Section 15 of the Offer to Purchase.
The Offer is being made pursuant to the Agreement and Plan of Merger dated
as of December 21, 2000 (the "Merger Agreement") by and among Hughes, the
Purchaser and Telocity. The purpose of the Offer is for the Purchaser to
acquire a majority voting interest in Telocity as the first step in Hughes
acquiring the entire equity interest in Telocity. The purpose of the Merger is
to acquire all outstanding Shares not tendered and purchased pursuant to the
Offer. The Merger Agreement provides that, among other things, as promptly as
practicable after the purchase of Shares pursuant to the Offer and the
satisfaction or waiver of the other conditions set forth in the Merger
Agreement, the Purchaser will be merged with and into Telocity (the "Merger"),
with Telocity continuing as the surviving corporation and a wholly owned
subsidiary of Hughes. If the Minimum Condition is satisfied, the Purchaser
would have sufficient voting power to approve the Merger without the affirmative
vote of any other stockholder of Telocity. Telocity has also granted Hughes an
irrevocable option, exercisable in whole if the Minimum Condition is met and the
Purchaser accepts for payment pursuant to the Offer less than 90% of the Shares
of Telocity then outstanding, to purchase additional Shares equal to an amount
that, when added to the Shares already owned by the Purchaser at the time the
option is exercised, will constitute one Share more than 90% of the Shares of
Telocity then outstanding, at a price per share equal to $2.15 net per Share.
Pursuant to the Merger Agreement, at the effective time of the Merger (the
"Effective Time"), each Share outstanding immediately prior to the Effective
Time (other than Shares owned by Telocity or Hughes or any of their respective
subsidiaries, all of which will be cancelled, and Shares held by Telocity
stockholders who perfect dissenters' rights) will be converted into the right to
receive $2.15 in cash or any greater per Share price paid in the Offer, without
interest thereon. The Merger Agreement is more fully described in Section 11 of
the Offer to Purchase.
THE BOARD OF DIRECTORS OF TELOCITY HAS UNANIMOUSLY (1) DETERMINED THAT THE
TERMS OF THE OFFER AND THE MERGER ARE FAIR TO AND IN THE BEST INTERESTS OF THE
STOCKHOLDERS OF TELOCITY, (2) APPROVED AND ADOPTED THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE MERGER, AND (3)
RECOMMENDED THAT TELOCITY'S STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR
SHARES PURSUANT TO THE OFFER AND APPROVE AND ADOPT THE MERGER AGREEMENT.
For purposes of the Offer, the Purchaser will be deemed to have accepted
for payment, and thereby purchased, Shares validly tendered and not properly
withdrawn as, if and when the Purchaser gives oral or written notice to the
Depositary of the Purchaser's acceptance for payment of such Shares pursuant to
the Offer. Upon the terms and subject to the conditions of the Offer, payment
for Shares accepted for payment pursuant to the Offer will be made by
deposit of the Offer Price therefor with the Depositary, which will act as agent
for tendering stockholders for the purpose of receiving payments from the
Purchaser and transmitting such payments to tendering stockholders whose Shares
have been accepted for payment. Under no circumstances will interest on the
Offer Price for Shares be paid, regardless of any extension of the Offer or
delay in making such payment. In all cases, payment for Shares tendered and
accepted for payment pursuant to the Offer will be made only after timely
receipt by the Depositary of (i) the certificates evidencing such Shares (the
"Share Certificates") or timely confirmation of a book-entry transfer (a "Book-
Entry Transfer Confirmation") of such Shares into the Depositary's account at
the Depositary Trust Company (the "Book-Entry Transfer Facility") pursuant to
the procedures set forth in Section 3 of the Offer to Purchase, (ii) the Letter
of Transmittal, properly completed and duly executed with any required signature
guarantees, or an Agent's Message (as defined in the Offer to Purchase) in
connection with a book-entry transfer and (iii) any other documents required by
the Letter of Transmittal.
Subject to the terms of the Merger Agreement, the Purchaser may, without
the consent of Telocity, (i) extend the Offer beyond the scheduled expiration
date for one or more periods up to 10 additional business days each if any of
the conditions to the Purchaser's obligation to accept for payment and to pay
for the Shares is not satisfied or, to the extent permitted by the Merger
Agreement, waived, (ii) extend the Offer for (a) any period required by any
rule, regulation or interpretation of the Securities and Exchange Commission
(the "SEC") or its staff applicable to the Offer and (b) for one or more periods
of up to 10 additional business days due to the failure to satisfy the condition
relating to the expiration or termination of the waiting period under the HSR
Act, or (iii) if all conditions to the Offer have been satisfied or waived,
extend the Offer for up to 20 business days if the number of Shares that have
been validly tendered and not withdrawn represent more than 50% but less than
90% of the issued and outstanding Shares, provided that Purchaser must accept
for payment and promptly pay for all Shares validly tendered and not withdrawn
at that time. An extension described in clause (i) of the immediately preceding
sentence of this paragraph will not extend beyond the eightieth business day
following the date after the Offer commenced.
Subject to the applicable rules and regulations of the SEC and the
provisions of the Merger Agreement, the Purchaser expressly reserves the right,
in its sole discretion, at any time or from time to time, (i) to terminate the
Offer if any of the conditions set forth in Section 15 of the Offer to Purchase
have not been satisfied and (ii) to waive any condition to the Offer (other than
the Minimum Condition) or otherwise amend the Offer in any respect, in each case
by giving oral or written notice of such extension, termination, waiver or
amendment to the Depositary and by making a public announcement thereof. If the
Purchaser accepts for payment any Shares pursuant to the Offer, it will accept
for payment all Shares validly tendered prior to the Expiration Date and not
properly withdrawn, and will promptly pay for all Shares so accepted for
payment. The term "Expiration Date" means 5:00 p.m., New York City time, on
Monday, April 2, 2001, unless the Purchaser shall have extended the period of
time for which the Offer is open, in which event the term "Expiration Date"
shall mean the latest time and date at which the Offer, as so extended by the
Purchaser, shall expire.
Any extension, delay, termination, waiver or amendment will be followed as
promptly as practicable by public announcement thereof, such announcement in the
case of an extension to be made no later than 9:00 a.m., New York City time, on
the next business day after the
previously scheduled Expiration Date, in accordance with the public announcement
requirements of Rule 14e-1(d) under the Securities Exchange Act of 1934, as
amended. During any such extension, all Shares previously tendered and not
withdrawn will remain subject to the Offer, subject to the rights of a tendering
stockholder to withdraw such stockholder's Shares.
Shares tendered pursuant to the Offer may be withdrawn at any time prior to
the Expiration Date. Thereafter, such tenders are irrevocable except that they
may be withdrawn after Monday, April 2, 2001 unless theretofore accepted for
payment by the Purchaser. If the Offer is extended beyond the initial
Expiration Date and all of the conditions to the Offer have been met, the
Purchaser must pay for all Shares already tendered and immediately accept and
pay for all Shares tendered during the subsequent Offer period, such that there
will be no withdrawal rights during the subsequent Offer period. For a
withdrawal of Shares to be effective, a written, telegraphic or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover page of the Offer to Purchase.
Any such notice of withdrawal must specify the name, address and taxpayer
identification number of the person who tendered the Shares to be withdrawn, the
number of Shares to be withdrawn and the name of the registered holder of such
Shares, if different from that of the person who tendered such Shares. If Share
Certificates evidencing Shares to be withdrawn have been delivered or otherwise
identified to the Depositary, then, prior to the physical release of such Share
Certificates, the serial numbers shown on such Share Certificates must be
submitted to the Depositary and the signature(s) on the notice of withdrawal
must be guaranteed by an Eligible Institution (as defined in the Offer to
Purchase), unless such Shares have been tendered for the account of an Eligible
Institution. If Shares have been tendered pursuant to the procedures for book-
entry transfer as set forth in the Offer to Purchase, any notice of withdrawal
must also specify the name and number of the account at the Book-Entry Transfer
Facility (as defined in the Offer to Purchase) to be credited with the withdrawn
Shares. If the Purchaser extends the Offer, is delayed in its acceptance for
payment of Shares or is unable to accept Shares for payment pursuant to the
Offer for any reason, then, without prejudice to the Purchaser's rights under
the Offer, the Depositary may, nevertheless, on behalf of the Purchaser, retain
tendered Shares, and such Shares may not be withdrawn except to the extent that
tendering stockholders are entitled to withdrawal rights as described in the
Offer to Purchase. All questions as to the form and validity (including time of
receipt) of any notice of withdrawal will be determined by the Purchaser, in its
sole discretion, whose determination will be final and binding. None of the
Purchaser, Hughes, or any of their affiliates or assigns, the Depositary, the
Information Agent or any other person will be under duty to give notification of
any defects or irregularities in any notice of withdrawal or incur any liability
for failure to give any such notification.
The receipt of cash in exchange for Shares pursuant to the Offer or the
Merger will be a taxable transaction for U.S. federal income tax purposes and
may also be a taxable transaction under applicable state, local or foreign tax
laws. In general, a stockholder who receives cash in exchange for Shares
pursuant to the Offer or the Merger will recognize gain or loss for U.S. federal
income tax purposes equal to the difference, if any, between the amount of cash
received and such stockholder's adjusted tax basis in the Shares exchanged
therefor. Provided that such Shares constitute capital assets in the hands of
the stockholder, such gain or loss will be capital gain or loss, and will be
long-term capital gain or loss if the holder has held the Shares for more than
one year at the time of sale. The maximum U.S. federal income tax rate
applicable to
individual taxpayers on long-term capital gains is 20%, and the deductibility of
capital losses is subject to limitations. All stockholders should consult with
their own tax advisors as to the particular tax consequences of the Offer and
the Merger to them, including the applicability and effect of the alternative
minimum tax and any state, local or foreign income and other tax laws and of
changes in such tax laws. For a more complete description of certain U.S.
federal income tax consequences of the Offer and the Merger, see Section 5 of
Offer to Purchase.
The information required to be disclosed by Paragraph (d)(1) of Rule 14d-6
of the General Rules and Regulations under the Exchange Act is contained in the
Offer to Purchase and is incorporated herein by reference.
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Telocity has provided to the Purchaser its list of stockholders and
security position listings for the purpose of disseminating the Offer to holders
of Shares. The Offer to Purchase, the related Letter of Transmittal and other
related materials are being mailed to record holders of Shares and will be
furnished to brokers, dealers, commercial banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on the stockholder
list or, if applicable, who are listed as participants in a clearing agency's
security position listing, for subsequent transmittal to beneficial owners of
Shares.
THE OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION THAT SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE
WITH RESPECT TO THE OFFER.
Questions and requests for assistance and copies of the Offer to Purchase,
the Letter of Transmittal and all other tender offer materials may be directed
to the Information Agent at its address and telephone number set forth below and
will be furnished promptly at the Purchaser's expense. The Purchaser will not
pay any fees or commissions to any broker or dealer or any other person (other
than the Information Agent) for soliciting tenders of Shares pursuant to the
Offer.
The Information Agent for the Offer is:
Morrow & Co., Inc.
445 Park Avenue, 5th Floor
New York, NY 10022
telocity.info@morrowco.com
Banks and Brokers Call Toll Free: (800) 654-2468
All Others Located Within the United States and Canada Call Toll Free:
(800) 607-0088
All others Located Outside the United States and Canada Call Collect:
(212) 754-8000
February 1, 2001