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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 8 - K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
Date of earliest event reported: July 7, 2000
ABLE TELCOM HOLDING CORP.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
FLORIDA 0-21986 65-0013218
(STATE OF OTHER JURISDICTION OF (COMMISSION (IRS EMPLOYER
INCORPORATION OR ORGANIZATION) FILE NUMBER) IDENTIFICATION NO.)
1000 HOLCOMB WOODS PARKWAY
SUITE 440
ROSWELL, GEORGIA 30076
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(770) 993-1570
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
NOT APPLICABLE
(FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR,
IF CHANGED SINCE LAST REPORT)
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ABLE TELCOM HOLDING CORP.
FORM 8-K
CURRENT REPORT
EXPLANATORY NOTE
Able Telcom Holding Corp. ("Registrant" or "Company") is filing this Form 8-K to
disclose (i) the terms of the settlement agreement dated July 7, 2000 between
the Company and Sirit Technologies, Inc., (the "Settlement Agreement") and (ii)
certain amendments, as provided for in the Settlement Agreement, to its existing
agreements with its former Series B Preferred Stock holders and its current
Series C Preferred Stock holders.
ITEM 5. OTHER EVENTS
The Company and Sirit Technologies, Inc. ("Sirit") entered into the Settlement
Agreement to settle Sirit Technologies, Inc. vs. Able Telcom Holding Corp. (Case
Number 98-1153, United States District Court, Southern District of Florida). The
Settlement Agreement resulted in the entry of a Consent Judgment pursuant to
which the Court's Entry of Judgment Following Jury Verdict, dated May 16, 2000,
in the amount of $31.5 million, was vacated. Under the Settlement Agreement, the
Company agreed to make a cash payment of $5.0 million to Sirit and to use its
best efforts to obtain all necessary corporate, regulatory and shareholder
approvals required to issue to Sirit and register with the SEC on an effective
Form S-1 Registration Statement approximately 5.0 million shares of Company
common stock on or before November 30, 2000. If certain events, including both
shareholder approval and registration, do not occur by November 30, 2000, the
Company will be obligated under the Settlement Agreement to pay Sirit $20.0
million instead of issuing the common shares. Sirit also has the right to buy
additional shares from the Company, if the Company sells additional shares
within the next two years, on the same terms as the shares are sold to third
parties in an amount sufficient to maintain its pro rata ownership of common
stock. However, this right will not apply if the Company sells shares at a price
of at least $10.00 per share. For more detailed information, please refer to
Exhibit 10.52, the Agreement, which is filed as part of this Current Report on
Form 8-K.
In conjunction with the Agreement, the Company entered into certain amendments
("Amendments") to the agreements with its holders of Series B Preferred Stock
and Series C Preferred Stock dated February 4, 2000. No shares of Series B
Preferred Stock are now outstanding. The Amendments set a fixed $4.00 per share
price for converting the Series C Preferred Stock, for an aggregate of 3.75
million shares of common stock, and extend the required date for registration of
these common shares from October 31, 2000 until November 30, 2000. The
conversion of the preferred shares is dependent upon shareholder approval of an
increase in the number of authorized shares of common stock of the Company and
of their issuance. If the shareholders fail to approve this issuance or the
Company fails to have these shares registered by November 30, 2000, the holders
of the Series C Preferred Stock will be entitled to a cash payment of $18.0
million. Further, the Series C Preferred Stock holders were issued additional
warrants to purchase 750,000 shares of common stock at prices ranging from $6-8
per share. The Series C Preferred Stock holders further agreed to surrender
their right to
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purchase additional shares of preferred stock from the Company. For more
detailed information, please refer to Exhibit 10.52, which is filed as part of
this Current Report on Form 8-K.
In addition, as provided in the Settlement Agreement, WorldCom, the Company's
largest customer and shareholder, agreed to (i) extend the term of the existing
Master Services Agreement with the Company by three years to July 1, 2006 and
(ii) to convert debt of approximately $36.5 million which is currently due from
the Company into seven-year term debt. WorldCom and the Company are currently
negotiating documentation to effect these agreements. For more detailed
information, please refer to Exhibit 10.52, which is filed as part of this
Current Report on Form 8-K.
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
------- -----------
<S> <C>
2.5.4 Master Services Agreement between WorldCom Network Services, Inc. and
MFS Network Technologies, Inc. dated as of July 2, 1998 (exhibits
omitted) (1)
4.19 Series B Convertible Preferred Stock Exchange Agreement by and between
Able Telcom Holding Corp. and the RoseGlen Group dated February 4, 2000
(2)
4.19.1 Amendment No. 1 to Securities Exchange Agreement and Related
Registration Rights Agreement of Able Telcom Holding Corp. [RGC
International Investors, LDC], dated July 7, 2000.
4.21 Registration Rights Agreement associated with Series B Convertible
Preferred Stock Exchange Agreement (2)
4.21.1 Amendment No. 1 to Securities Exchange Agreement and Related
Registration Rights Agreement of Able Telcom Holding Corp., dated July
7, 2000.
4.22 Series C Convertible Preferred Stock Purchase Agreement (2)
4.22.1 Amendment No. 1 to Able Telcom Holding Corp. Series C Convertible
Preferred Stock Purchase Agreement and Related Agreements, dated July
7, 2000.
10.52 Settlement Agreement, between the Sirit Parties and the Able Parties,
dated July 7, 2000.
99 Press Release issued July 12, 2000
(1) Incorporated by reference from an exhibit to the Company's
Current Report on Form 8-K (File No. 0-21986), as filed August
3, 1998.
(2) Incorporated by reference from an exhibit to the Company's
Annual Report of Form 10-K (File No. 0-21986), for the fiscal
year ended October 31, 1999, as filed February 22, 2000.
</TABLE>
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned there unto duly authorized.
ABLE TELCOM HOLDING CORP.
(The Company)
/s/ BILLY V. RAY, JR.
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Date: July 14, 2000 Name: Billy V. Ray, Jr.
Title: Chief Executive Officer
