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): December 29, 2000
SALIENT 3 COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-12588 23-2280922
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation ) File Number) Identification No.)
P. O. BOX 1498, READING, PENNSYLVANIA 19603
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (610) 856-5500
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Item 5. OTHER EVENTS.
On January 4, 2001 Salient 3 Communications, Inc.
(Nasdaq/NMS:STCIA) announced that it has completed the sale of
its XEL Communications, Inc. ("XEL") subsidiary to a corporation
controlled by XEL's president, James S. Kennedy. The purchase
price for the sale was $4.9 million plus an earn-out based on
future performance.
Under the terms of the agreement, Salient 3 received a promissory
note for the full amount of the purchase price. The note bears
interest at 8% and has a term of 24 months and is secured by stock
of XEL. No principal is required to be paid until a balloon
payment is due at the end of the 24 months. In the event that XEL
is re-sold to another party within the first 24 months after this sale,
Salient 3 would receive repayment of its note and 70% of all
proceeds in excess of $5 million. If XEL is sold by the buyer after
24 months, but within 36 months of this sale, Salient would receive
50% of all proceeds over $5 million. After giving effect to the tax
loss in excess of the amount previously estimated, the Company
estimates that its unaudited Net Asset Value in Liquidation has
dropped by approximately $0.42 to $2.93 from the reported
September 30 amount of $3.35. The Company cautioned that there
can be no assurance that the promissory note taken in the
transaction will be re-paid within the required time frame. If the
note is not repaid, the Net Asset Value in Liquidation could decline
further from the estimated $2.93.
The Company announced that it is continuing to negotiate the sale
of the building occupied by XEL in Aurora, Colorado and now
expects that an agreement on the sale can be reached within 90
days.
Finally, the Company also indicated that there have been no
material developments with respect to the previously announced
complaint filed in Delaware Chancery Court on August 29, 2000
by a group of former employees and current Class A shareholders,
challenging the compensation packages granted by the Company to
its senior management in connection with the dissolution of the
Company. The Company has received no response to its motion to
dismiss.
In accordance with recently implemented Regulation FD, Salient 3
will not respond to individual investor inquiries regarding the
timing, process or ultimate outcome of its liquidation process. The
Company will, however, issue announcements whenever material
events occur in its liquidation process that could have a potential
impact on its net assets in liquidation.
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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 thereunto duly authorized.
SALIENT 3 COMMUNICATIONS, INC.
Date: January 5, 2001
/s/Paul H. Snyder
Paul H. Snyder
Senior Vice President and
Chief Financial Officer
