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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): September 15, 1999
McLEODUSA INCORPORATED
(Exact name of registrant as specified in its charter)
Delaware 0-20763 42-1407240
(State or Other (Commission (IRS Employer
Jurisdiction of File Identification
Incorporation) Number) Number)
McLeodUSA Technology Park 52406-3177
6400 C Street S.W., P.O. Box 3177
Cedar Rapids, IA
(Address of Principal (Zip Code)
Executive Offices)
Registrant's telephone number, including area code: (319) 364-0000
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INFORMATION TO BE INCLUDED IN THE REPORT
Item 5. Other Events.
Pursuant to a stock purchase agreement (the "Agreement") dated August 30, 1999
between McLeodUSA Incorporated and three partnerships affiliated with Forstmann
Little & Co. (collectively, "Forstmann Little"), McLeodUSA issued and sold on
September 15, 1999 approximately $1 billion in McLeodUSA convertible preferred
stock to Forstmann Little. The convertible preferred stock, which was issued as
two new series of preferred stock, has a conversion price of $36.50 per share of
McLeodUSA Class A common stock and a 3.5 percent coupon. Under the terms of the
Agreement, subject to certain limited exceptions, Forstmann Little & Co.may not
for five years (i) transfer the preferred stock or the underlying shares of
Class A common stock or (ii) convert the preferred stock to Class A common
stock. Additionally, McLeodUSA may call the preferred stock after seven years.
The investment represents ownership of approximately 12 percent of the Class A
common stock of McLeodUSA on a fully diluted basis. Theodore J. Forstmann,
senior partner at Forstmann Little & Co., and Erskine Bowles, senior partner at
Forstmann Little & Co. and former White House Chief of Staff, have joined the
McLeodUSA Board of Directors.
A copy of the Agreement is attached as Exhibit 10.1 hereto and incorporated
herein by reference. Copies of the press releases, dated August 30, 1999 and
September 15, 1999, issued by McLeodUSA regarding the above-described
transaction, are attached as Exhibits 99.1 and 99.2 hereto and incorporated
herein by reference.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits.
10.1 Stock Purchase Agreement dated as of August 30, 1999 by and
between McLeodUSA Incorporated and certain purchasers listed on
the signature pages.
99.1 Press Release, dated August 30, 1999, announcing the Company's
agreement with Forstmann Little for the purchase by Forstmann
Little of $1 Billion of McLeodUSA convertible preferred stock.
99.2 Press Release, dated September 15, 1999, announcing the issuance
and sale by McLeodUSA of $1 billion of McLeodUSA convertible
preferred stock to Forstmann Little and the naming of Erskine
Bowles to the McLeodUSA Board.
SIGNATURES
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.
Date: September 23, 1999 McLeodUSA Incorporated
By: /s/ Randall Rings
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Randall Rings
Vice President, Secretary and
General Counsel
EXHIBIT INDEX
10.1 Stock Purchase Agreement dated as of August 30, 1999 by and between
McLeodUSA Incorporated and certain purchasers listed on the
signature pages.
99.1 Press Release, dated August 30, 1999, announcing the Company's
agreement with Forstmann Little for the purchase by Forstmann
Little of $1 Billion of McLeodUSA convertible preferred stock.
99.2 Press Release, dated September 15, 1999, announcing the issuance
and sale by McLeodUSA of $1 billion of McLeodUSA convertible
preferred stock to Forstmann Little and the naming of Erskine
Bowles to the McLeodUSA Board.