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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
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DATE OF REPORT: SEPTEMBER 14, 1998
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APPLIED INNOVATION INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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Delaware 0-21352 31-1177192
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(STATE OR OTHER (COMMISSION FILE NO.) (IRS EMPLOYER
JURISDICTION OF IDENTIFICATION NUMBER)
INCORPORATION OR
ORGANIZATION)
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5800 INNOVATION DRIVE
DUBLIN, OHIO 43016
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER
INCLUDING AREA CODE OF REGISTRANT'S
PRINCIPAL EXECUTIVE OFFICES)
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Not Applicable
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
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ITEM 5. OTHER EVENTS.
On September 14, 1998, Applied Innovation Inc., a Delaware corporation,
announced it has terminated all product development and related activities of
its Access Products Group due to an unsuccessful search for a strategic partner.
The press release is included as Exhibit 99 to this Form 8-K and is incorporated
herein by this reference.
ITEM 7. EXHIBITS.
(c) EXHIBITS.
Exhibit No. Description
99 Press Release, dated September 14, 1998, entitled
"Applied Innovation Inc. Announces Termination of
Access Products Development Activity"
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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.
APPLIED INNOVATION INC.
Date: September 15, 1998 By: /s/ WILLIAM H. LARGENT
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William H. Largent, Senior Vice
President - Operations and Chief
Financial Officer
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EXHIBIT INDEX
Exhibit No. Description
99 Press Release, dated September 14, 1998, entitled "Applied
Innovation Inc. Announces Termination of Access Products
Development Activity"
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EXHIBIT 99
APPLIED INNOVATION INC. ANNOUNCES TERMINATION OF ACCESS PRODUCTS DEVELOPMENT
ACTIVITY
DUBLIN, Ohio, Sept. 14 /PRNewswire/ -- Applied Innovation Inc. (Nasdaq: AINN -
news) today announced it has terminated all product development and related
activities of its Access Products Group due to an unsuccessful search for a
strategic partner. In March of this year, the Company made an announcement that
it was seeking a strategic partner for the Access Products Group and
subsequently retained an investment banking firm to conduct the search. The
results of the search proved unsuccessful thus resulting in the decision to
terminate the Access Products Group.
This termination will result in the closing of the Raleigh, North Carolina
facility and a reduction in staff of approximately 60 employees, including 50 at
the Company's Raleigh facility and approximately 10 at the Dublin, Ohio
facility. Following these reductions, the Company will have approximately 220
employees in its Dublin, Ohio facility and regional sales offices.
A one-time charge of $3.8 million will be taken in the quarter ending September
30, 1998 to account for all costs associated with the termination of the Access
Products Group.
Gerard B. Moersdorf, Jr., Chairman and Chief Executive Officer, commented, "This
difficult decision was made following an extensive search for a strategic
partner and thorough consideration of alternatives by the Board of Directors.
Without a strategic partner, we lacked the ability to successfully compete in
the large Access Products arena." Mr. Moersdorf continued, "It was also
important to evaluate Applied Innovation's long-term opportunities and not
jeopardize our established core business. The Company's expanding line of Data
Communications Network devices offers good growth potential and continues to
contribute to our strong balance sheet, which included $11.0 million in cash and
$29.6 million of stockholders' equity at June 30, 1998. We remain committed to
continue seeking ways to enhance long-term stockholders' value."
This press release contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, which are intended to be
covered by the safe harbors created thereby. Those statements include, but may
not be limited to, all statements regarding intent, beliefs, expectations,
projections, forecasts, and plans of the Company and its management, and
include: statements regarding the Access Products Group and the DCN Products
Group (paragraphs one through four), the closing of the Raleigh, North Carolina
facility (paragraph two) and a reduction in staff of approximately 60 employees
(paragraph two), a one-time charge to account for all costs associated with the
termination of the Access Products Group (paragraph three), the Company's
expanding line of DCN products which offer good growth potential (paragraph
four), and commitment to continue seeking ways to enhance long-term
stockholders' value (paragraph four). These forward-looking statements involve
numerous risks and uncertainties, including, without limitation: the Company's
ability to adapt with technological changes, the impact of
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competitive products and services, as well as the various risks inherent in the
Company's business and other risks and uncertainties detailed from time to time
in the Company's periodic reports filed with the Securities and Exchange
Commission, including, the Company's Annual Report on Form 10-K for the year
ended December 31, 1997. One or more of these factors have affected, and could
in the future affect, the Company's businesses and financial results in future
periods and could cause actual results to differ materially from plans and
projections. Therefore, there can be no assurance that the forward-looking
statements included in this press release will prove to be accurate. In light of
the significant uncertainties inherent in the forward-looking statements
included herein, the inclusion of such information should not be regarded as a
representation by the Company, or any other person, that the objectives and
plans of the Company will be achieved. All forward-looking statements made in
this press release are based on information presently available to the
management of the Company. The Company assumes no obligation to update any
forward-looking statements.
Applied Innovation Inc. is the leading provider of mediation products, which
enable communications between network elements and operational support systems
for the management of telecommunications carriers' networks. Applied
Innovation's products provide communications and interoperability for more than
100,000 network elements within many of the world's largest and fastest growing
telecommunications service providers. Applied Innovation Inc. is headquartered
in Dublin, Ohio and can be reached on the World Wide Web at
http://www.aiinet.com.
