WIRELESS CABLE & COMMUNICATIONS INC
8-K, 1998-08-03
CABLE & OTHER PAY TELEVISION SERVICES
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                                  UNITED STATES
                       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



                                 July 17, 1998
                 Date of Report (Date of earliest event reported)


                      Wireless Cable & Communications, Inc.
             (Exact name of registrant as specified in its charter)



Nevada                                  00-21143                 87-0545056
(State or other jurisdiction of      (Commission File          (IRS Employer
incorporation)                          Number)              Identification No.)



            102 West 500 South, Suite 320, Salt Lake City, Utah 84101
               (Address of principal executive offices) (Zip Code)





        Registrant's telephone number, including area code (801) 328-5618




                                       N/A
         (Former name or former address, if changed since last report.)



<PAGE>


Item 2.  Acquisition or Disposition of Assets.

         Effective  July 17, 1998,  Wireless Cable &  Communications,  Inc. (the
"Company")  and  FondElec  Essential  Services  Growth Fund,  L.P.  ("FondElec")
acquired  all  the  outstanding  stock  of  two  El  Salvadorian   corporations,
Cablevisa,  S.A. ("Cablevisa") and Multicable,  S.A.  ("Multicable"),  from Star
Industries,  S.A., a Panamanian  corporation ("Star").  Cablevisa and Multicable
own and operate multi-channel subscription television systems in the Republic of
El Salvador. Cablevisa and Multicable have approximately 23,000 subscribers. The
two  companies  provide their  multi-channel  subscription  television  services
through their own networks of fiberoptic and copper-based  cable.  Cablevisa and
Multicable  have also been granted the right to use 200 MHz of El Salvador's 2.5
GHz wireless communications frequency band.

         The  purchaser  of  Cablevisa  and  Multicable  was Chispa Dos Inc.,  a
company  formed  under the laws of the Cayman  Islands  ("Chispa").  The Company
(through a newly-formed wholly owned subsidiary,  WCI Cayman, Inc.) and FondElec
own,  respectively,  49.5% and 50.5% of the outstanding capital stock of Chispa.
Under the terms of the parties'  agreements  regarding Chispa,  the Company will
have  operating  control  of  Chispa,  will  hold a  majority  of the  Board  of
Director's  seats for  Chispa,  and will have the  right to  acquire  FondElec's
interest in Chispa under certain conditions. The Company paid approximately $2.7
million for its interest in Chispa,  and is required to make additional  capital
contributions  to Chispa  (either in the form of debt or equity) to fund its pro
rata portion of Chispa's  operating  costs and deferred  purchase price payments
for the stock of Cablevisa and  Multicable,  as described  below. If the Company
fails to make  those  payments,  its  interest  in  Chispa  will be  subject  to
dilution.

         The total  purchase  price for  Cablevisa  and  Multicable  was  $16.91
million.  Approximately  $4.77 million of the purchase price was paid in cash at
closing,  and the balance of the purchase price  (approximately  $12.14 million)
was  paid  through  Chispa's  delivery  of three  promissory  notes.  The  first
promissory note, in the original principal amount of approximately $5.2 million,
is due and payable on February  17, 1999.  The second  promissory  note,  in the
approximate  principal  amount of $3.47  million,  is due and payable on May 17,
1999.  The final  promissory  note,  in the original  principal  amount of $3.47
million,  is due on July 17,  2000.  The  amounts due under the first and second
promissory  notes are  non-interest  bearing  (except in the event of default by
Chispa,  in which case the notes will bear  interest at the rate of 7% per annum
from the date of default),  but the amounts due under the third  promissory note
bear interest at the rate of 7% per annum.  If Chispa defaults on the payment of
any  amounts  due under any of the  notes,  Star may  accelerate  all  remaining
amounts due under all of the notes. In connection with the closing,  Chispa also
paid $428,339 of  outstanding  debt of Cablevisa  and  Multicable to third party
banks.

         The payment obligations under the first and second promissory notes are
secured by a pledge of a portion of the shares  acquired by Chispa in  Cablevisa
and Multicable and a mortgage over Cablevisa's and  Multicable's  real property.
The amounts due under the third promissory note are unsecured, but in connection
with the transaction  FondElec  delivered a commitment letter to Star evidencing
its  agreement  to  provide  sufficient  capital  (either in the form of debt or
equity) to Chispa to pay the amounts  due under the second and third  promissory
notes.  The security  interest  encumbering the pledged shares and the mortgaged
property  will be released as Chispa  makes  payment of portions of the purchase
price.  Under the terms of the promissory notes,  Chispa is not required to make
any payments if it has a claim for indemnification for any breach by Star or its
principals  of  any  representation,   warranty  or  covenant  relating  to  the
transaction,   unless  an  arbitration  panel  has  ruled  that  the  claim  for
indemnification   is  without  merit  or  Star  or  its  principals  have  fully
indemnified Chispa for the breach.

<PAGE>


Item 7.  Financial Statements and Exhibits.

         (a)      Exhibits.  N/A.

         (b) Financial Statements. The Company will file as an amendment to this
report and  within the time  period  set forth in Item  7(a)(4),  the  financial
statements for the acquired  business for the periods  specified in Rule 3-05(b)
of Regulation S-X, as promulgated under the Securities  Exchange Act of 1934, as
amended,  and as prepared in accordance with the  requirements  (other than with
respect to supporting  schedules) of  Regulation  S-X,  together with a manually
signed accountants' report as provided in Rule 2-02 of Regulation S-X.

                                           WIRELESS CABLE & COMMUNICATIONS, INC.



                                          /s/ Anthony Sansone
                                     By:  Anthony Sansone, Secretary & Treasurer
                                     Dated: August 3, 1998


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