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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
Date of Report (Date of earliest event reported): JUNE 3, 1997
IPL SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
MASSACHUSETTS
(State or other jurisdiction of incorporation)
0-10370 33-026715
(Commission File No.) (IRS Employer Identification No.)
124 ACTON STREET
MAYNARD, MASSACHUSETTS 01754
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (508) 461-1000
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ITEM 1. CHANGE IN CONTROL OF REGISTRANT
In connection with the transaction described in Item 2 below, a change
in control of IPL Systems, Inc., a Massachusetts corporation ("IPL") occurred as
of June 3, 1997. For a detailed description and for the additional information
required by this Item 1 see Item 2 below.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On June 3, 1997, IPL Acquisition Corp., a Delaware corporation ("IPL
Sub") and a wholly owned subsidiary of IPL merged with and into Andataco, a
California corporation ("Andataco"), pursuant to an Agreement and Plan of Merger
and Reorganization, dated February 28, 1997 (the "Merger Agreement"), among IPL,
IPL Sub, Andataco and W. David Sykes, a shareholder of Andataco ("Sykes"). Upon
consummation of the merger of IPL Sub with Andataco (the "Merger"), IPL Sub
ceased to exist, and Andataco, the surviving corporation, became a wholly owned
subsidiary of IPL.
Under the terms of the Merger Agreement, each share of Andataco Common
Stock, $1.00 par value, outstanding immediately prior to the closing of the
Merger was converted into approximately 1,874 shares of IPL Class A Common
Stock, $.01 par value ("IPL Common Stock"). Upon effectiveness of the Merger, a
change in control of IPL occurred with Sykes owning approximately 72% of the
shares of IPL Common Stock outstanding immediately after consummation of the
Merger and the shares held by the existing shareholders of IPL representing
23.7% of the shares of IPL Common Stock outstanding. At the closing of the
Merger, 18,078,381 shares of IPL Common Stock were issued to Andataco
shareholders, representing approximately 76.3% of the shares of IPL Common Stock
outstanding immediately after consummation of the Merger. Sykes, the former
President and Chief Executive Officer and a shareholder of Andataco, received
17,044,298 shares of IPL Common Stock plus cash in lieu of fractional shares in
exchange for his Andataco Common Stock. The Sykes Children's Trust of 1993 (the
"Trust"), a former shareholder of Andataco, received 1,034,083 shares of IPL
Common Stock plus cash in lieu of fractional shares in exchange for its Andataco
Common Stock. IPL has withheld ten percent of the total shares of IPL Common
Stock issued to Sykes and the Trust in Escrow ("Escrow Shares") to satisfy the
indemnity obligation, if any, set forth in the Merger Agreement. In addition, a
total of 272,982 shares of IPL Common Stock are issuable upon exercise of an
outstanding Andataco warrant and Andataco option that were assumed by IPL in the
Merger. Harris Ravine, a director of IPL, was appointed Chief Executive Officer
of Andataco effective May 1, 1997.
Concurrent with the consummation of the Merger, IPL's Board of
Directors was reconstituted and is now composed of the following board members:
Harris Ravine, Chairman of the Board; W. David Sykes, Vice Chairman of the
Board; Stephen J. Ippolito, Director; and Cornelius P. McMullan, Director.
Furthermore, a change in management occurred
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with the following officers being appointed: Harris Ravine, Chief Executive
Officer; W. David Sykes, President; and Richard Hudzik, Chief Financial Officer,
Treasurer and Secretary.
Andataco is in the business of designing, marketing and servicing high
availability, business-critical storage and backup solutions for the Unix and
Windows NT environments. IPL and Andataco intend to continue to devote the
assets of the business to such purposes.
Reference is made to IPL's Proxy Statement dated May 6, 1997 filed with
the Securities and Exchange Commission for additional information with respect
to the Merger.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED
Report of Independent Auditors(1)
Balance Sheet as of October 31, 1995 and 1996 (1) and as of
April 30, 1997(2)
Statement of Operations for the Years Ended October 31, 1994,
1995, and 1996(1) and for the Six Months Ended April 30,
1996 and 1997(2)
Statement of Shareholders' Equity (Deficit) for the Years
Ended October 31, 1994, 1995 and 1996(1)
Statement of Cash Flows for the Years Ended October 31, 1994,
1995 and 1996(1) and for the Six Months Ended April 30,
1996 and 1997(2)
Notes to Financial Statements(1)
(b) PRO FORMA FINANCIAL INFORMATION
Unaudited Pro Forma Combined Balance Sheet as of April 30,
1997(2)
Unaudited Pro Forma Combined Statement of Operations for the
Six Months Ended April 30, 1996 and 1997 and for the Year
Ended October 31, 1996(2)
(c) EXHIBITS.
2.1 Agreement and Plan of Merger and Reorganization dated
February 28, 1997 among IPL Systems, Inc., IPL
Acquisition Corp., Andataco and W. David Sykes.
99.1 Press release, dated June 3, 1997.
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(1) Incorporated by reference to Financial Statements filed
with the Commission in IPL's Proxy Statement dated May 6,
1997.
(2) Incorporated by reference to Financial Statements filed
with the Commission in IPL's Form 10-Q for the quarter
ended April 30, 1997.
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ITEM 8. CHANGE IN FISCAL YEAR.
IPL has changed its fiscal year as of June 10, 1997, from December 31
to October 31.
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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.
IPL SYSTEMS, INC.
Dated: June 16, 1997 By: /s/ Richard A. Hudzik
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Richard A. Hudzik
Vice President, Finance, Chief Financial
Officer, Treasurer and Clerk
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
PAGE NO.
<S> <C>
2.1 Agreement and Plan of Merger and Reorganization dated February 28, 1997 among
IPL Systems, Inc., IPL Acquisition Corp., Andataco and W. David Sykes. (1)
99.1 Press release, dated June 3, 1997.
</TABLE>
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(1) Filed with the Securities and Exchange Commission as an
Exhibit to IPL's Current Report on Form 8-K dated February 28,
1997, and incorporated herein by this reference.
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EXHIBIT 99.1
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[IPL NEWS
SYSTEMS
LOGO] RELEASE
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COMPANY CONTACT: ANITA BUCHANAN
IPL SYSTEMS, INC.
(508) 461-1090
FOR IMMEDIATE RELEASE
IPL SYSTEMS, INC. REPORTS
CLOSING OF ANDATACO MERGER
MAYNARD, MA (JUNE 3, 1997) - IPL SYSTEMS, INC. (NASDAQ/SMALLCAP IPLS) today
announced that it has completed the closing of the merger transaction with
ANDATACO according to the terms of the Agreement and Plan of Merger and
Reorganization entered into by the two companies on February 28, 1997. IPL
shareholders approved the plan on June 3.
Under the agreement, the shareholders of ANDATACO were issued a total of
18,078,381 shares of IPL Class A Common Stock, of which 10% are to be held in
escrow for one year, and an additional 272,982 shares were reserved for
issuance upon exercise of certain outstanding warrants and options of ANDATACO.
IPL now has a total of 23,712,200 shares issued and outstanding, and W. David
Sykes, the principal shareholder of ANDATACO, is now the controlling
shareholder of the combined companies. Immediately following the closing,
Harris Ravine was elected Chairman and CEO of IPL and W. David Sykes was
elected to be a director, Vice Chairman and President.
In the combined companies, sales and distribution will be driven from three
groups. ANDATACO Sales will continue to handle sales and distribution of
end-user and reseller products. ESP Sales will continue to develop OEM
partnerships based on ANDATACO's Enterprise Storage Packaging (ESP), related
storage management software and other strategic hardware and software
technologies. The Professional Services Group will provide customers with
value-added technical and consulting services. IPL Systems' Maynard,
Massachusetts operations will be the research and development organization,
supplemented by ANDATACO's software engineering staff. Maynard operations will
also include certain advanced production, marketing responsibilities and
technical support.
Based on their respective financial reporting schedules, the aggregate 1996
revenues of the two companies totaled more than $100 million, and current
employees total 235, including 70 sales personnel in 19 sales offices worldwide.
For financial reporting purposes, the results of the combined businesses will be
reported based on ANDATACO's
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fiscal year, which ends on October 31. Shares will be traded on the Nasdaq
SmallCap Market under the symbol "IPLS."
Chairman and CEO Harris Ravine stated, "The completion of this merger marks the
emergence of an NT and UNIX storage provider which combines IPL's traditional
engineering capability and ANDATACO's successful sales and distribution channels
as well as its service commitment. The integration of the two organizations
began prior to closing to assure a smooth transition, and we are encouraged by
the progress to date. One result of this collaboration is that, within 30 days,
we expect to introduce a new high availability RAID storage solution that
combines IPL's dual active controller technology with ANDATACO's unique ESP
enclosure, offering attractive features and price performance advantages
compared to available technologies."
Vice Chairman and President W. David Sykes commented, "I am pleased that we
have moved from focusing on the merger process to the introduction of new
products, expansion of our markets and management of the company's performance.
The development of OEM partnership initiatives and the new Professional Services
Group offer particularly exciting new avenues for increasing our business
opportunities. I know that both organizations believe that ANDATACO and IPL are
an excellent match and we look forward to realizing the potential of the new
company."
ANDATACO-IPL Systems, Inc., with offices in San Diego, California and Maynard,
Massachusetts, designs, manufactures and distributes open-architecture storage
solutions for UNIX and Windows NT environments. The combined companies design
high availability disk storage, tape backup and restore solutions based on their
unique controllers and intelligent enclosure technology. The companies
distribute internally developed products, and products from other manufacturers,
through a network of 19 sales offices worldwide and through business affiliates
in Europe, Asia, Latin America, Canada and Australia.
