SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 02549
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FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): June 11, 1998
PHONETEL TECHNOLOGIES, INC.
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(Exact Name of Registrant as Specified in its Charter)
Ohio 0-16715 34-1462198
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(State or Other (Commission (IRS Employer
Jurisdiction File Number) Identification Number)
of Incorporation)
North Point Tower, 7th Floor, 1001 Lakeside Avenue, Cleveland, Ohio 44114
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(Address of principal executive offices) (Zip Code)
Registrant's Telephone number, including area code (216) 241-2555
Item 1. Change in Control of Registrant
(a) Not applicable
(b) On June 11, 1998, PhoneTel Technologies, Inc. ("PhoneTel")
entered into a definitive Agreement and Plan of Merger and Reorganization
(the "Merger Agreement") with Davel Communications Group, Inc. ("Old
Davel") pursuant to which, among other things, PhoneTel and Old Davel will
combine their operations (the "Transaction") under a newly formed holding
company to be called Davel Communications, Inc. ("New Davel"). Under the
terms of the Merger Agreement, which has been unanimously approved by the
Boards of Directors of both companies, holders of outstanding common stock
of PhoneTel ("PhoneTel Common Stock") will receive shares of common stock
of New Davel ("New Davel Common Stock"), based upon a value of $3.08 per
share of PhoneTel Common Stock. The number of shares of New Davel Common
Stock to be issued will be determined based on the average closing price of
the common stock of Old Davel ("Old Davel Common Stock") for the 30
consecutive trading days ending on the second day prior to shareholders'
approval of the Transaction, subject to a cap of 0.13765 shares of New
Davel Common Stock for each share of PhoneTel Common Stock. The
transaction will be accounted for as a pooling of interests and is expected
to be tax free to PhoneTel and Old Davel shareholders.
Consummation of the Transaction is conditioned upon approval of the
Transaction by shareholders of both PhoneTel and Old Davel and the receipt
of regulatory approvals, including approvals under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended.
The Transaction is subject to certain other conditions, including the
redemption of PhoneTel's 14% Convertible Cumulative Redeemable Preferred
Stock and completion of a cash tender offer for PhoneTel's 12% Senior Notes
due 2006 (the "Notes") at a price not exceeding 101% of the principal
amount of the Notes, with a minimum of 80% of the $125 million outstanding
principal amount having been tendered. Satisfaction of these conditions is
dependent upon receipt by Old Davel of financing, which is expected to be
obtained through a combination of high yield debt and a senior credit
facility.
In connection with the Merger Agreement, on June 11, 1998, PhoneTel
entered into Stock Voting Agreements (the "Davel Voting Agreements") with
each of Mr. David R. Hill, Chairman of the Board of Old Davel, and
Samstock, L.L.C., an affiliate of Equity Group Investments, Inc.
("Samstock"), pursuant to which, among other things, each of Mr. Hill and
Samstock agreed to vote all shares of Old Davel Common Stock owned by them
in favor of the Transaction. Samstock, which is an investment vehicle
controlled by Mr. Sam Zell, previously has agreed, among other things, to
purchase 1,623,900 shares of Old Davel Common Stock from Old Davel and
certain selling shareholders.
In connection with the Merger Agreement, on June 11, 1998, Old Davel
entered into Stock Voting Agreements (the "PhoneTel Voting Agreements")
with each director of PhoneTel (the "PhoneTel Directors"), ING (U.S.)
Investment Corporation ("ING") and Cerberus Partners, L.P. ("Cerberus"),
pursuant to which, among other things, the PhoneTel Directors, ING and
Cerberus agreed to vote all shares of PhoneTel Common Stock owned by them
in favor of the Transaction. Additionally, PhoneTel entered into a Stock
Voting Agreement with Samstock (the "Samstock Voting Agreement"), pursuant
to which, among other things, Samstock agreed to vote all shares of
PhoneTel Common Stock owned by it in favor of the Transaction.
In connection with the Merger Agreement, on June 11, 1998, PhoneTel
entered into (i) a Consulting and Non-Competition Agreement with Mr. Peter
Graf, PhoneTel's chief executive officer (the "Consulting Agreement"), and
(ii) an Employment and Non-Competition Agreement with Ms. Tammy Martin,
PhoneTel's chief administrative officer (the "Employment Agreement").
The foregoing is a summary only and is qualified in its entirety by
reference to the Merger Agreement, the Davel Voting Agreements, the
PhoneTel Voting Agreements, the Samstock Voting Agreement, the Consulting
Agreement and the Employment Agreement.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits
(2) Agreement and Plan of Merger and Reorganization, dated June 11,
1998, by and among Davel Communications Group, Inc., Davel
Holdings, Inc., D Subsidiary, Inc., PT Merger Corp. and PhoneTel
Technologies, Inc.*
(10.1) Voting Agreement, dated June 11, 1998, by and between
PhoneTel Technologies, Inc. and Mr. David R. Hill*
(10.2) Voting Agreement, dated June 11, 1998, by and between
PhoneTel Technologies, Inc. and Samstock, L.L.C.*
(10.3) Voting Agreement, dated June 11, 1998, by and between
PhoneTel Technologies, Inc. and Samstock, L.L.C.*
(10.4) Consulting and Non-Competition Agreement, dated June 11,
1998, by and between PhoneTel Technologies, Inc. and Mr.
Peter Graf*
(10.5) Employment and Non-Competition Agreement, dated June 11,
1998, by and between PhoneTel Technologies, Inc. and Ms.
Tammy Martin*
(99.1) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. Peter Graf*
(99.2) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. Steven Richman*
(99.3) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. George Henry*
(99.4) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. Aron Katzman*
(99.5) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. Joseph Abrams*
(99.6) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and ING (U.S.) Investment
Corporation*
(99.7) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Cerberus Partners, L.P.*
(99.8) Joint Press Release of PhoneTel Technologies, Inc. and Davel
Communications Group, Inc., dated June 12, 1998*
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* previously filed
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.
PHONETEL TECHNOLOGIES, INC.
Dated: September 28, 1998 By: /s/ Tammy L. Martin
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Tammy L. Martin
Chief Administrative Officer
Index to Exhibits
Exhibit Exhibit
Number
(2) Agreement and Plan of Merger and Reorganization, dated June 11, 1998,
by and among Davel Communications Group, Inc., Davel Holdings, Inc., D
Subsidiary, Inc., PT Merger Corp. and PhoneTel Technologies, Inc.*
(10.1) Voting Agreement, dated June 11, 1998, by and between PhoneTel
Technologies, Inc. and Mr. David R. Hill*
(10.2) Voting Agreement, dated June 11, 1998, by and between PhoneTel
Technologies, Inc. and Samstock, L.L.C.*
(10.3) Voting Agreement, dated June 11, 1998, by and between PhoneTel
Technologies, Inc. and Samstock, L.L.C.*
(10.4) Consulting and Non-Competition Agreement, dated June 11, 1998, by
and between PhoneTel Technologies, Inc. and Mr. Peter Graf*
(10.5) Employment and Non-Competition Agreement, dated June 11, 1998, by
and between PhoneTel Technologies, Inc. and Ms. Tammy Martin*
(99.1) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. Peter Graf*
(99.2) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. Steven Richman*
(99.3) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. George Henry*
(99.4) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. Aron Katzman*
(99.5) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Mr. Joseph Abrams*
(99.6) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and ING (U.S.) Investment Corporation*
(99.7) Voting Agreement, dated June 11, 1998, by and between Davel
Communications Group, Inc. and Cerberus Partners, L.P.*
(99.8) Joint Press Release of PhoneTel Technologies, Inc. and Davel
Communications Group, Inc., dated June 12, 1998*
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*previously filed
