UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Sections 13 and 15(d) of
the Securities Exchange Act of 1934
July 22, 1998
Date of Report (Date of earliest event reported)
SA TELECOMMUNICATIONS, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 0-18048 75-228519
(State Of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
1600 Promenade Center, 15th Floor
Richardson, TX 75080
(Address of Principal Executive Office)
(972) 690-5888
(Registrant's Telephone Number, Including Area Code)
(Not Applicable)
(Former Name or Former Address,
if Changed Since Last Report)
<PAGE>
Item 2. Acquisition or Disposition of Assets
On July 22, 1998, SA Telecommunications, Inc. (the "Registrant") and
certain of its subsidiaries (collectively, the "Company" or the "Sellers") sold
substantially all of their assets and business (the "Assets") to USC Telecom,
Inc. (the "Buyer"), as the assignee of EqualNet Corporation, pursuant to that
certain Purchase Agreement dated as of January 15, 1998 among the Company,
EqualNet Corporation ("EqualNet Corp.") and EqualNet Communications Corp. f/k/a
EqualNet Holding Corp. ("EqualNet" and, collectively with the Buyer and EqualNet
Corp., the "EqualNet Parties") as amended by that certain Amendment dated as of
March 10, 1998 and those certain Letter Agreements dated as of May 28, 1998 and
July 21, 1998 (collectively, the "Purchase Agreement").
Pursuant to the Purchase Agreement, certain assets, including the
following, were explicitly excluded from the Assets (the "Excluded Assets"): (i)
all cash and cash equivalents of the Sellers; (ii) all income tax refunds and
income tax credits of the Sellers; (iii) all claims and causes of action of the
Sellers; (iv) all rights of the Sellers under insurance policies and under
warranties, representations and guaranties made by suppliers, manufacturers and
contractors relating to the Excluded Assets; and (vii) all capital stock and
stock certificates of the Sellers.
The net consideration received for the Assets consisted of cash in the
amount of approximately $550,000 and 195,073 shares of EqualNet Series C
Convertible Preferred Stock, subject to post-closing adjustments. In addition,
the Sellers had previously borrowed approximately $3,000,000 from EqualNet,
which amount was deducted by EqualNet from the purchase price.
There is no material relationship between any of the EqualNet Parties
and the Registrant or any of its affiliates, directors or officers, or any
associate of any such director or officer.
The sale of the Company to the Buyer was made as part of the Sellers'
bankruptcy cases in an attempt to liquidate their assets so as to facilitate
distribution to their creditors. Based on the anticipated proceeds from the
sale, the disposition of remaining assets and any recoveries obtained through
proceedings under the Bankruptcy Code, the Company believes that general
unsecured creditors will receive substantially less than a full recovery on
their claims and that the equity holders of the Company will not receive any
distribution under a plan of reorganization.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial statements of businesses acquired.
Not applicable.
(b) Pro Forma Financial Information
Not applicable
(c) Exhibits:
The Purchase Agreement was filed as an exhibit to a Form 8-K report
filed by the Registrant on January 28, 1998.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SA TELECOMMUNICATIONS, INC.
DATE: July 31, 1998 By: /s/ Albert B. Gordon, Jr.
-------------------------
Albert B. Gordon, Jr.
Chief Executive Officer
