SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities and Exchange Act of 1934
Date of Report (Date of Earliest Event Reported):
December 26, 2000
CELERITY SYSTEMS, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 0-23279 52-2050585
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(State or Other (Commission File (IRS Employer
Jurisdiction of Number) Identification No.)
Incorporation)
122 Perimeter Park Drive
Knoxville, Tennessee 37922
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(Address of Principal Executive Offices)
Registrant's Telephone Number, including
area code: (865) 539-5300
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(Former Address, if changed since last report)
Item 5: Other Events
References in this Current Report to the "Company," "we," "our," and "us" refer
to Celerity Systems, Inc., a Delaware corporation.
Forward-Looking Statements
In addition to historical information, this Current Report contains
forward-looking statements. These forward-looking statements are subject to
certain risks and uncertainties that could cause actual results to differ
materially from those reflected in these forward-looking statements. Factors
that might cause such a difference include, but are not limited to, that
occupancy rates at the rental properties described below may not reach the
levels we expect and that tenants may not purchase our services in the numbers
we expect or at the prices at which we offer such services. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
reflect management's opinions only as of the date hereof. We undertake no
obligation to revise or publicly release the results of any revision to these
forward-looking statements. Readers should carefully review the risk factors
described in other documents that we file from time to time with the Securities
and Exchange Commission.
Recent Developments
On December 26, 2000, we and four of Unisys Corporation's Asian
subsidiaries entered into separate Letters of Agreement for the purpose of
cooperating in the sale and support of interactive video and high-speed Internet
products and services in Hong Kong, Taiwan, Korea and China. We agreed to
negotiate separate definitive agreements with each of the subsidiaries, whereby
they will purchase products including our T 6000 digital set top boxes and video
servers which the subsidiaries will integrate into their own product and service
offerings in their respective countries. Terms relating to purchase volumes,
product brand labels and pricing, inter alia, have not been agreed to. No Unisys
entity is obligated to buy any product or pay any money to us until definitive
agreements are executed, and then, only in accordance with the terms of such
agreements.
On January 4, 2001, we and DesertScape Partners, L.P., an affiliate of
Bala Multi-Family Investment Company LLC, a property developer located in
Dallas, Texas, signed an agreement for the provision by us of broadband services
for 266 apartment units which DesertScape is building in Mesa, Arizona.
DesertScape agreed to promote us on an exclusive basis as the development's
preferred supplier of broadband services, including interactive TV, video on
demand, satellite and regular cable TV, Internet access, and such other services
as we may provide. The agreement has a term of ten years unless terminated for
breach, bankruptcy, or a related event.
We will be entitled to receive the monthly payments for the services
that are purchased by the individual tenants less commission payments to
DesertScape and In4structures as described below. We do not expect to begin
receiving revenue from this project before mid-April 2001 at the earliest. We
estimate that if and when the units reach their expected occupancy levels, we
could receive approximately $10,000 - $20,000 in monthly revenues from the
project net of commissions. Tenants of the units are not required, however, to
purchase any of our services, and there can be no assurance as to the revenues
we might receive.
We also entered into a joint marketing agreement with In4Structures LLC
of Bala Cynwyd, Pennsylvania, another affiliate of Bala Multi-Family Investment
Company LLC, to market products and services to tenants and management in
multihousing properties throughout the United States. This agreement includes
marketing such services to multihousing properties affiliated with Bala
Multi-Family Investment Company LLC, including those in Dallas, Houston,
Arizona, Florida, and Philadelphia, and is expected to include other properties
as well.
The agreement provides that we will pay In4structures a commission for
each sale of our products or services to an organization to which In4structures
introduces us. We pay them a larger commission when and if they provide
customer-specific sales and marketing assistance in connection with a sale as
was the case with the Mesa, Arizona, property as described above. Once we sign a
sales contract with an organization to which In4structures introduced us, this
agreement prohibits us from soliciting customers within a five-mile radius of
such organization's property unless In4structures declines the opportunity to
approach such customers and support such sales efforts.
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Item 7: Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits
99.1 Form of Letter of Intent.
99.2 Broadband Services Agreement, dated January 4, 2001,
with DesertScape L.P.
99.3 Cooperative Marketing Agreement, dated January 4, 2001,
with In4structures LLC.
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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.
Dated: January 8, 2001
CELERITY SYSTEMS, INC.
By: /s/ Kenneth D. Van Meter
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Kenneth D. Van Meter
President and Chief Executive Officer
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