Equus Amends Planned Rights Offering to Shareholders
December 16 2010 - 4:47PM
Business Wire
Equus Total Return, Inc. (NYSE: EQS) (“Equus” or the “Fund”)
today announced that its Board of Directors has amended the terms
of a non-transferable rights offering to the Fund’s shareholders to
purchase shares of its common stock wherein each Equus shareholder
will receive one non-transferable right for every share of the
Fund’s common stock owned on the record date. According to the
original terms of the offering, five rights were required to
acquire one share of Equus common stock. Today’s amendment now
reduces the number of rights required to be held on the record date
to three (3) in order to acquire one (1) share of Equus common
stock. The reduction in the ratio of rights required to acquire a
share of the Fund’s common stock has resulted in an increase in the
aggregate number of shares that may be issued from the exercise of
such rights from 1,772,329 to 2,953,882.
Certain factors considered by the Equus Board of Directors in
approving an increase in the size of the proposed rights offering
included the anticipated size and scale of new investment
opportunities in which the Fund may invest for the benefit of its
stockholders and a desire to diversify the Fund’s portfolio into
more income generating investments that also possess the potential
for capital appreciation.
The Fund has filed a registration statement with the Securities
and Exchange Commission with respect to the shares that are
proposed to be issued pursuant to the exercise of the rights (the
“Registration Statement”). The record date for Equus shareholders
entitled to receive such rights, if issued, shall be determined by
the Fund upon the effectiveness of the Registration Statement.
Subject to certain conditions, rights may be exercised during
the subscription period, which is intended to commence immediately
upon the effectiveness of the registration statement and end
approximately 23 days thereafter, unless the subscription period is
extended by the Fund (the “Expiration Date”) or the rights offering
is terminated. Record date stockholders who fully exercise all
rights issued to them are entitled to subscribe for additional
shares of the Fund's common stock which were not subscribed for by
other stockholders (the "Over-Subscription Privilege") by providing
to the Fund, at least seven (7) days prior to the Expiration Date
(the “Notice Date”), either: (i) payment of the estimated
subscription price for rights initially received by them and any
additional rights subscribed for in connection with the
Over-Subscription Privilege, or (ii) a notice and irrevocable
guarantee to the Fund for payment, by the Expiration Date, of the
number of shares they intend to purchase pursuant to their
Over-Subscription Privilege.
The subscription price for the shares to be issued in connection
with the exercise of the rights will be 90% of the average closing
price of the Fund’s shares of common stock on the New York Stock
Exchange for the eight consecutive trading days ending on the day
prior to the Notice Date. Because the subscription price will be
determined on the day prior to the Notice Date, shareholders
exercising pursuant to their Over-Subscription Privilege prior to
that date will not know the subscription price at the time the
notice and irrevocable guarantee are to be delivered to the Fund’s
subscription agent, and will be required initially to pay for both
the shares subscribed for pursuant to their basic subscription
rights and any additional shares subscribed for pursuant to the
Over-Subscription Privilege at the estimated subscription price
disclosed in the Registration Statement, and may be required to pay
an additional amount or receive a partial refund (without
interest), depending on the final subscription price.
Shareholders should read the Registration Statement which
describes, in more detail, the subscription process for the
exercise of basic subscription rights and the exercise of the
Over-Subscription Privilege. A copy of the Registration Statement
is available on the Fund’s website at www.equuscap.com.
Shareholders are also advised to carefully consider the investment
objectives, risks and charges and expenses of the Fund before
exercising their rights. The Registration Statement will include a
prospectus containing this and other information concerning Equus
(“Prospectus”). The Prospectus should be read carefully before
investing. A copy of the Prospectus, when filed, may be obtained
from The Altman Group, Inc., the Information Agent, 1200 Wall
Street West, 3rd Floor, Lyndhurst, New Jersey 07071 or by calling
toll free at (800) 330-8705.
Because the rights are not transferable, the Fund does not
intend to use the services of an underwriter or dealer. The Fund
has the right to terminate the offering prior to the expiration
date, in which case all the rights, including such rights as have
been exercised prior to the Expiration Date, will expire and the
Fund will return, without interest, any subscription proceeds.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy nor will there be any sale of the
shares referred to in this press release in any state or
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to the registration or qualification under the
securities laws of such state or jurisdiction.
About Equus
The Fund is a business development company that trades as a
closed-end fund on the New York Stock Exchange, under the symbol
"EQS". Additional information on the Fund may be obtained from the
Fund’s website.
This press release may contain certain forward-looking
statements regarding future circumstances. These forward-looking
statements are based upon the Fund’s current expectations and
assumptions and are subject to various risks and uncertainties that
could cause actual results to differ materially from those
contemplated in such forward-looking statements including, in
particular, the risks and uncertainties described in the Fund’s
filings with the SEC. Actual results, events, and performance may
differ. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as to the date hereof.
The Fund undertakes no obligation to release publicly any revisions
to these forward-looking statements that may be made to reflect
events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events. The inclusion of any statement
in this release does not constitute an admission by the Fund or any
other person that the events or circumstances described in such
statements are material.
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