Overstock.com, Inc. (NASDAQ:OSTK) today announced that its board of
directors has approved a non-transferable rights offering. The
offering will allow Overstock’s stockholders of record to purchase
shares of its preferred stock, including preferred shares to be
issued and traded exclusively on a registered alternative trading
system using the t0 issuance and trading platform developed by
Overstock’s majority-owned financial technology subsidiary t0.
Overstock is planning the rights offering primarily to enable t0
to demonstrate the operation of the t0 platform, while providing
Overstock’s stockholders of record the opportunity to participate.
Overstock intends to offer up to one million shares of its
preferred stock, and will give stockholders the opportunity to
subscribe for shares of its Blockchain Series A Preferred, which
will trade exclusively on the alternative trading system.
Stockholders will also have an opportunity to subscribe for an
alternative series of its voting preferred stock, which will be
economically identical to the Blockchain shares but will trade in
the over-the-counter market.
“This is the culmination of over two years of true innovation
and hard work,” said Overstock CEO Patrick M. Byrne. “Through this
public issuance of blockchain-based securities the history of
capital markets is entering a new era, the era of blockchain-based
securities.”
The rights offering will be made by a distribution of one
non-transferable subscription right for each ten shares of common
stock owned on the record date, plus one additional right for any
balance of nine or fewer shares held. The distribution of the
subscription rights settles T+3, so in order to be considered a
stockholder of record you must own the common stock in your
brokerage account as of 4:00 PM ET on Monday, November 7, 2016,
which is three trading days before the record date of November 10,
2016.
The proposed rights offering will include an over-subscription
privilege, which will entitle each rights holder that exercises its
basic subscription privilege in full the right to purchase
additional shares of preferred stock that remain unsubscribed at
the expiration of the rights offering, if any. Both the basic and
over-subscription privileges are subject to proration. The basic
and over-subscription privileges may be exercised during the
subscription period of November 15, 2016 through 5:00 PM ET on
December 6, 2016, subject to proration. Overstock may extend the
offering up to an additional 30 days, in which case the offering
would continue on a subscriptions first-in, first-served basis,
with the potential for pro rata allocation of shares among
participants subscribing on the day, if any, on which the offering
becomes over-subscribed.
The subscription exercise price (the “Subscription Price”) is
expected be the lower of: (1) 95% of the volume-weighted average
trading price (VWAP) for the five trading days ending November 11,
2016 (the “Maximum Price”), and (2) 95% of the VWAP for the five
trading days ending December 6, 2016. Subscribers will be
required to fund their subscriptions at the Maximum Price.
Overstock recommends that current stockholders consider
notifying their broker or financial advisor about the upcoming
rights offering to ensure they will maximize their ability to
participate in the rights offering.
The expected calendar is:
Monday, November 7,
2016 |
|
Ownership Day; must own
OSTK common stock by 4:00 PM ET to become a stockholder of record
on the Record Date. |
|
|
|
Tuesday, November 8,
2016 |
|
Shares trade Ex-Right |
|
|
|
Thursday, November 10,
2016 |
|
Record Date |
|
|
|
Monday, November 14,
2016 |
|
Announcement of Maximum
Price |
|
|
|
Tuesday, November 15,
2016 |
|
Subscription Period
Begins |
|
|
|
Tuesday, December 6,
2016 |
|
Subscription Period
expires at 5:00 PM ET and Final Price is determined. |
The rights offering will be made pursuant to Overstock’s
effective shelf registration statement on Form S-3 (Reg. No.
333-203607) on file with the Securities and Exchange Commission
(the “SEC”), and a prospectus supplement to be filed with the SEC
prior to the commencement of the rights offering. The information
herein is not complete and is subject to change. This press release
is not an offer to sell these securities and is not soliciting an
offer to buy these securities. The offering can be made only by a
final prospectus, including a prospectus supplement. Investors
should consider investment objectives, risks, charges and expenses
carefully before investing. The base prospectus included in the
registration statement contains this and additional information
about Overstock, and the prospectus supplement will contain this
and additional information about the rights offering, and rights
holders should read both carefully before exercising their rights
and investing.
Requests for copies of the base prospectus and the prospectus
supplement when available, and questions from stockholders relating
to the rights offering may be directed to the information agent for
the rights offering, as follows:
Information Agent: Georgeson LLC1290 Avenue of
the Americas9th FloorNew York, NY 10104(866)
432-2791Overstock@Georgeson.com
Source Capital Group invites any broker dealers interested in
participating in the rights offering to contact Source’s syndicate
department at OSTK@sourcegrp.com.
About Overstock.comOverstock.com, Inc.
(NASDAQ:OSTK) is an online retailer based in Salt Lake City, Utah
that sells a broad range of products at low prices, including
furniture, rugs, bedding, electronics, clothing, and jewelry.
Additional stores within Overstock include Worldstock.com,
dedicated to selling artisan-crafted products to help developing
nations around the world and Main Street Revolution, supporting
small-scale entrepreneurs in the U.S. by providing them with a
national customer base. Other community-focused initiatives include
Farmers Market and pet adoptions. Forbes ranked Overstock in
its list of the Top 100 Most Trustworthy Companies in 2014.
Overstock sells internationally under the name O.co and regularly
posts information about the company and other related matters under
Investor Relations on its website.
O, Overstock.com, O.com, O.co, Club O, Main Street
Revolution, Worldstock and OVillage are registered
trademarks of Overstock.com, Inc. O.biz and
Space Shift are also trademarks of Overstock.com, Inc.
Other service marks, trademarks and trade names which may be
referred to herein are the property of their respective
owners.
About Source Capital Group, Inc. Source Capital
Group, Inc. was founded in 1992 as a boutique investment banking
firm specializing in small to medium-sized transactions, and
continues to focus its investment banking activities in those
segments of the market. Source Capital has grown to include
businesses in general securities, emerging market securities,
distressed and high yield debt securities, investment management,
mortgages and business lending. Source Capital’s mission is to
provide excellent service and independent, unbiased and tailor-made
advice. Source Capital is registered as a broker-dealer with the
SEC and in 50 states, the District of Columbia and Puerto Rico, and
is a member of the Financial Industry Regulatory Authority and the
Securities Investor Protection Corporation.
Forward-Looking Statements: This press release
contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Such forward-looking statements include all
statements other than statements of historical fact. These
forward-looking statements are inherently difficult to predict.
Actual results, including all matters relating to the rights
offering and all matters relating to our future financial results,
could differ materially for a variety of reasons. Information about
factors that could potentially affect our financial results is
included in our Form 10-Q for the quarter ended June 30, 2016 which
we filed with the SEC on August 4, 2016. These and our other
subsequent filings with the SEC identify important factors that
could cause our actual results to differ materially from those
contained in our projections, estimates and other forward-looking
statements.
Overstock.com, Inc. has filed a registration statement
(including a prospectus) with the SEC for the offering to which
this communication relates. Before you invest, you should read the
prospectus in that registration statement, the applicable
prospectus supplement for any securities offered pursuant to the
registration statement, and other documents that Overstock.com,
Inc. has filed or files in the future with the SEC for more
complete information about Overstock.com, Inc. and the offering.
You may get these documents for free by visiting EDGAR on the SEC
Web site at www.sec.gov. Alternatively, Overstock.com, Inc. will
arrange to send you the prospectus if you request it by calling
1-801-947-5409.
Media Contact:
Kirstie Burden, Overstock.com, Inc.
+1 (801) 947-3564
pr@overstock.com
Investor Contact:
Mark Harden, Overstock.com, Inc.
+1 (801) 947-5409
ir@overstock.com
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