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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 7, 1996
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INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC.
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(Exact name of registrant as specified in charter)
Delaware 0- 94-3248701
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
400 S. El Camino Real, Suite 1275, San Mateo, California 94402
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (415) 548-0808
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Not Applicable.
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(Former name or former address, if changed since last report.)
This document contains six pages.
The Exhibit Index appears on page six.
Page 1 of 6.
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
(a) On November 7, 1996, International Wireless
Communications, Inc. ("IWC"), a wholly-owned subsidiary of the Registrant,
acquired 85,030,000 newly issued ordinary shares, nominal value HK$1.00 per
share (the "Shares"), of Star Digitel Limited ("SDL"), a Hong Kong company
engaged in the cellular telephone business in the People's Republic of China
(the "Acquisition"), pursuant to a subscription agreement (the "Subscription
Agreement") dated as of September 23, 1996, among IWC, SDL, Star Telecom Holding
Limited ("STHL"), a Hong Kong company, and Star Telecom International Holding
Limited ("STIHL"), a Bermuda company listed on The Stock Exchange of Hong Kong
Limited. STHL is a wholly owned subsidiary of STIHL. The Shares acquired by IWC
represent a 40% equity interest in SDL. Prior to the Acquisition, SDL was a
wholly-owned subsidiary of STHL, which currently holds the remaining 60% equity
interest in SDL.
The aggregate consideration paid by IWC for the Shares was
US$20,000,000 in cash (the "Consideration"), US$11,000,000 of which was paid to
SDL and US$9,000,000 of which was paid to STHL. The Consideration was provided
out of the Registrant's general working capital and out of the proceeds of the
Registrant's recent sale of 14% senior secured discount notes and warrants to
purchase shares of the Common Stock of the Registrant, which sale was
consummated on August 15, 1996.
The determination of the amount of the Consideration was based
upon arm's-length negotiations between IWC and STHL. Pursuant to the terms of
the Subscription Agreement, IWC placed US$9,000,000 of the Consideration in
escrow on September 23, 1996, pending the fulfillment of certain closing
conditions. On November 7, 1996, these conditions were either fulfilled or
waived by IWC, and the escrowed portion of the Consideration was released to
STHL in connection with the closing of the Acquisition.
The Subscription Agreement also provides for payment by IWC of
up to an additional $28,000,000, $9,000,000 of which will be paid to STHL and
$19,000,000 of which will be paid to SDL, to acquire an additional 220,305,000
newly issued ordinary shares of SDL if SDL achieves certain operational
milestones to the satisfaction of IWC in its sole discretion on or before August
7, 1997. If SDL does not achieve such milestones to the satisfaction of IWC in
its sole discretion on or before such date, IWC may exchange its equity interest
in SDL for a pre-determined number of ordinary shares of STIHL.
Pursuant to the Subscription Agreement, IWC, SDL and STHL also
entered into a shareholders' agreement and various other agreements, including
agreements related to the provision of management and technical services to SDL
by IWC and STHL. Additional information regarding SDL and the terms of the
Acquisition is set forth in the Subscription Agreement and the exhibits thereto,
which qualify the foregoing description of the Acquisition in its entirety and
are incorporated herein by reference.
Page 2 of 6.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS.
(a) Financial Statements of the Business Acquired. The following financial
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statements for SDL are hereby incorporated by reference to the
financial statements contained in the Registrant's Registration
Statement on Form S-1, filed with the Commission on September 13,
1996, as subsequently amended (Reg. No.333-11987).
(1) Independent Accountant's Report (Deloitte Touche Tohmatsu,
Certified Public Accountants);
(2) Consolidated Balance Sheets at December 31, 1994 and 1995
(audited) and at June 30, 1996 (unaudited);
(3) Consolidated Profit and Loss Account for each of the three years
ended December 31, 1993, 1994, and 1995 (audited) and for the
six-month period ended June 30, 1996 (unaudited);
(4) Consolidated Cash Flow Statements for each of the three years
ended December 31, 1993, 1994 and 1995 (audited) and for the
six-month period ended June 30, 1996 (unaudited); and
(5) Notes to Consolidated Financial Statements.
(b) Pro Forma Financial Information. The following pro forma financial
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information for the Registrant is incorporated by reference to the Pro
Forma Consolidated Condensed Financial Statements of the Registrant
contained in the Registrant's Registration Statement on Form S-1,
filed with the Commission on September 13, 1996, as subsequently
amended (Reg. No. 333- 11987).
(1) Pro Forma Consolidated Condensed Balance Sheets at
December 31, 1995 (unaudited) and September 30, 1996 (unaudited);
(2) Pro Forma Consolidated Condensed Statements of Operations for the
fiscal year ended December 31, 1995 (unaudited) and for the
nine-month period ended September 30, 1996 (unaudited); and
(3) Notes to Pro Forma Consolidated Financial Statements.
Page 3 of 6.
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(c) Exhibits.
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Exhibit
Number Description
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2.7 Subscription Agreement dated September 23,
1996, by and among IWC, SDL, STHL and STIHL,
including:
Exhibit A Form of Escrow Agreement
Exhibit B Form of Shareholders' Agreement
Exhibit C Form of STHL Management Services Agreement
Exhibit D Form of IWC Management Services Agreement
Exhibit E Form of Noncompetition Agreement
Exhibit F Form of Loan Agreement
2.8 Letter Agreement between IWC and STHL regarding the loan
agreement between SDL and STHL, dated November 7, 1996
2.9 Letter Agreements between IWC and STHL regarding
indemnification, dated November 5, 1996 and November 7,
1996
Page 4 of 6.
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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.
International Wireless Communications
Holdings, Inc.
Dated: November 21, 1996 By: /s/ Douglas S. Sinclair
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Douglas S. Sinclair
Executive Vice President and Chief
Financial Officer
Page 5 of 6.
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<TABLE>
<CAPTION>
EXHIBIT INDEX
Exhibit
Number Description
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<S> <C>
2.7* Subscription Agreement dated September 23, 1996, by and among
International Wireless Communications, Inc. ("IWC"), Star
Digitel Limited ("SDL"), Star Telecom Holding Limited ("STHL")
and Star Telecom International Holding Limited, including:
Exhibit A Form of Escrow Agreement
Exhibit B Form of Shareholders' Agreement
Exhibit C Form of STHL Management Services Agreement
Exhibit D Form of IWC Management Services Agreement
Exhibit E Form of Noncompetition Agreement
Exhibit F Form of Loan Agreement
2.8** Letter Agreement between IWC and STHL regarding the loan
agreement between SDL and STHL, dated November 7, 1996
2.9*** Letter Agreements between IWC and STHL regarding
indemnification, dated November 5, 1996 and November 7, 1996
</TABLE>
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* Incorporated by reference to Exhibit No. 2.2 to the Registrant's
Registration Statement on Form S-1, filed on September 13, 1996, as
subsequently amended (Reg. No. 333-11987).
** Incorporated by reference to Exhibit No. 2.3 to the Registrant's
Registration Statement on Form S-1, filed on September 13, 1996, as
subsequently amended (Reg. No. 333-11987).
*** Incorporated by reference to Exhibit No. 2.4 to the Registrant's
Registration Statement on Form S-1, filed on September 13, 1996, as
subsequently amended (Reg. No. 333-11987).
Page 6 of 6.
