Filed by Covista Communications, Inc. Pursuant to Rule 425
Under the Securities Act of 1933
Subject Company: Capsule Communications, Inc.
Commission File No.: 0-30555
FORWARD-LOOKING STATEMENTS
Some of the statements in this document are "forward-looking statements" and
are made pursuant to the Safe Harbor provisions of the Private Securities
Litigation Act of 1995. Investors are cautioned that forward-looking
statements such as statements of the Companies' plans, objectives,
expectations and intentions, involve risks and uncertainties, and may not be
indicative of future results. The cautionary statements made in this release
should be read as being applicable to all related statements wherever they
appear. Statements containing terms such as "believes," "expects," "plans,"
"projects," "intends," "estimates," "anticipates," or similar terms, are
considered to contain uncertainty and are forward-looking statements. The
actual results could differ materially from those discussed. Factors that
could contribute to such differences include the following: changes in market
conditions and increased competition from other telecommunications and
Internet service providers; government regulations; the volatile and
competitive environment for Internet telephony; advances in competitive
products or technologies that could reduce demand for services; availability
of transmission facilities; management of rapid growth; customer concentration
and attrition; the ability to successfully integrate the combined company; the
ability to successfully develop and bring new services to market; and other
risks discussed in the SEC filings of the respective companies, including Form
10-K and Form 10-Q, which can be accessed at the SEC Web site at www.sec.gov.
A reader of this document should understand that it is not possible to predict
or identify all such risk factors. Consequently, the reader should not
consider this list to be a complete statement of all potential risks or
uncertainties. Neither Covista nor Capsule assumes the obligation to update
any forward-looking statement, except as is required by applicable law.
OTHER LEGAL INFORMATION
Covista plans to file a Registration Statement on SEC Form S-4 in connection
with the merger, and each of Covista and Capsule expects to mail a Joint Proxy
Statement/Prospectus to its respective stockholders containing information
about the merger. Investors and security holders are urged to read the
Registration Statement and the Joint Proxy Statement/Prospectus carefully when
such documents are available. The Registration Statement and the Joint Proxy
Statement/Prospectus will contain important information about Covista,
Capsule, the merger and related matters. Investors and security holders will
be able to obtain free copies of these documents through the website
maintained by the U.S. Securities and Exchange Commission at www.sec.gov.
Copies of the joint proxy statement/prospectus and the SEC filings that will
be incorporated by reference therein also can be obtained, without charge, by
directing a request to Covista Communications, Inc., 150 Clove Road, Little
Falls, NJ 07424, Attention: Thomas P. Gunning (973-812-1100), or to Capsule
Communications, Inc., Two Greenwood Square, 3331 Street Road, Suite 275,
Bensalem, PA 19020, Attention: David B. Hurwitz (215-244-3433).
Capsule, its directors, executive officers and certain members of management
and employees may be soliciting proxies from Capsule's shareholders in favor
of the adoption of the merger agreement. A description of any interests that
Capsule's directors and executive officers have in the merger will be
available in the Joint Proxy Statement/Prospectus.
Covista, its directors, executive officers and certain members of management
and employees may be soliciting proxies from Covista's shareholders in favor
of the issuance of Covista shares in connection with the merger. A
description of any interests that Covista's directors and executive officers
have in the merger will be available in the Joint Proxy Statement/Prospectus.
The Communication filed herewith is an August 21, 2001 press release of
Covista announcing the appointment of Kevin A. Alward to the Company's
expanded Board of Directors.
NEWS RELEASE
FOR IMMEDIATE RELEASE
COVISTA COMMUNICATIONS, INC. ANNOUNCES APPOINTMENT OF KEVIN A. ALWARD TO
EXPANDED BOARD OF DIRECTORS
LITTLE FALLS, N.J. August 21, 2001 Covista Communications, Inc. (NASDAQ:
CVST) has appointed Kevin A. Alward, the Company's Chief Operating Officer, to
the Company's Board of Directors. The Company also has announced that the
Board has been expanded by two positions, the second of which will be filled
at the Company's Annual Meeting to be scheduled later this year.
Mr. Alward became Covista's Chief Operating Officer on March 29, 2001, in what
was a return to the Company. From 1994 to 1998, he had served as President and
Chief Operating Officer under the Company's former name, Total-Tel USA
Communications, Inc. Upon leaving Total-Tel in 1998, Mr. Alward became
President of North America for Destia Communications, Inc. (formerly known as
Econophone, Inc.). He left Destia shortly after its acquisition by Viatel,
Inc., and in April of 2000 he co-founded Blink Data Corp., a
telecommunications and data services provider headquartered in northern New
Jersey. Mr. Alward served as President and Chief Executive Officer of Blink
until that company was acquired by Covista on March 29.
John Leach, Covista's President and Chief Executive Officer, said of Mr.
Alward's appointment, "The addition of Kevin Alward to the Covista Board is an
enhancement that should well serve our customers, our shareholders and our
business partners. Not only is he an experienced telecommunications executive
who has achieved an enviable track record in each of the companies with which
he has been affiliated, but he knows Covista from his previous tenure in the
Company. In the period of less than five months since Mr. Alward has returned
as COO, he has successfully completed several significant initiatives to
increase the Company's gross margins and to streamline the Company's other
operations. As we move forward with our previously announced plans to acquire
new businesses, new switch sites and to launch new products and services, Mr.
Alward's unique insight will be a welcome addition to our Board."
Mr. Alward added, "Covista is a company with great upside potential that has
not yet been fully realized. We have a talented management team in place and
we believe we are poised to complete the turnaround that has been several
months in the making. Our employees are committed to the task, they have a
stake in the outcome, and we are continuing to execute the business plan that
our Directors previously have approved. I am looking forward to serving on the
Board and to contributing in every way that I can."
ABOUT COVISTA:
Covista is a facilities-based long distance telecommunications, Internet and
data services provider with a substantial customer base in both the commercial
and wholesale market segments. Its products and services include a broad
range of voice, data and Internet solutions, including long distance and
toll-free services, calling card, frame relay, Internet access, VPN, directory
assistance and teleconferencing services. The wholesale division provides
domestic and international termination services to carriers worldwide at
competitive rates. Covista currently owns and operates switches in New York
City and Newark, New Jersey, and previously has announced plans to expand to
additional switch sites in Los Angeles, Chicago, Dallas and Chattanooga, as
well as to open a 200-seat call center in Chattanooga. An additional switch
site in the Philadelphia area is expected to be added when the previously-
announced acquisition of Capsule Communications is completed. The Company
previously announced that it has acquired nation-wide network facilities
comprising 2,822,400,000 DS-0 channel miles of telecommunications capacity.
Covista operates a Network Operations Center in Northern New Jersey to monitor
its switched network and to coordinate its various services. Covista processes
approximately 95% of all its call volume through its own facilities. For
information on becoming a Covista customer, please telephone (888) 426-8478 or
visit the Company's website at www.covista.com.
INFORMATION RELATING TO FORWARD-LOOKING STATEMENTS:
This press release contains historical and forward-looking statements which are
made pursuant to the Safe Harbor provisions of the Private Securities Litigation
Act of 1995. Investors are cautioned that forward-looking statements such as
statements of the Company's plans, objectives, expectations and intentions
involve risks and uncertainties. The cautionary statements made in this release
should be read as being applicable to all related statements wherever they
appear. Statements containing terms such as "believes," "expects," "plans,"
"projects," "intends," "estimates," "anticipates," or similar terms, are
considered to contain uncertainty and are forward-looking statements. The actual
results could differ materially from those discussed. Factors that could
contribute to such differences include: changes in market conditions and
increased competition from other telecommunications and Internet service
providers; government regulations; the volatile and competitive environment for
Internet telephony; advances in competitive products or technologies that could
reduce demand for services; availability of transmission facilities; management
of rapid growth; customer concentration and attrition; the ability to
successfully integrate acquired companies; the ability to successfully develop
and bring new services to market; and other risks discussed in the company's SEC
filings, including Form 10-K and Form 10-Q, which can be accessed at the SEC Web
site at www.sec.gov.
Readers of this release should understand that it is not possible to predict or
identify all such risk factors. Consequently, this list should not be considered
a complete statement of all potential risks or uncertainties. Covista does not
assume the obligation to update any forward-looking statement, except as is
required by applicable law.
Contact:
Covista Communications, Inc.
Tom Gunning
(973) 812-1100
tgunning@covista.com