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UNITED STATES
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
Date of Report (Date of earliest event reported): April 24, 2000
TELECOMM INDUSTRIES, CORP.
(Exact name of registrant as specified in its charter)
Delaware 0-4410 34-1765902
(State or other (commission file (IRS employer
jurisdiction of number) identification no.)
incorporation)
1743 Quincy Avenue
Naperville, Illinois 60540
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (630) 369-7111
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Item 5. Other Events.
Effective April 15, 2000, Telecomm Industries Corp. (the "Company")
entered into a definitive Purchase Agreement among PantaStar Communications,
Inc., PentaStar Corporation, Inc. and the Company, pursuant to which the
Company has agreed to the sale of certain of its assets. On April 24, 2000,
the Company issued a press release, filed below as an exhibit hereto and
incorporated herein by reference, announcing the signing of the Agreement.
Item 7. Financial Statements and Exhibits.
(c) Exhibits
(99.1) Press Release of the Company dated April 24, 2000
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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.
TELECOMM INDUSTRIES CORP.
Date: April 24, 2000 By: /s/ Paul J. Satterthwaite
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Paul J. Satterthwaite
Chief Executive Officer,
President and Secretary
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EXHIBIT INDEX
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Exhibit
No. Description
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<S> <C>
99.1 Press Release of Telecomm Industries Corp. dated April 24, 2000
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EXHIBIT 99.1
Contact: Contact:
Telecomm Industries Corp. Telecomm Industries Corp.
Dave Gruber Paul Satterthwaite
Phone: (330) 963-0566 Phone: (317) 202-3050
Telecomm Industries Corp. Signs Definitive Agreement with
PentaStar Communications, Inc.
Naperville, Illinois- April 24, 2000 - Telecomm Industries Corp.
(TCMM:OTC BB) announced today that it has executed a definitive agreement to
sell its network services division to PentaStar Communications, Inc. (NASDAQ:
PNTA), one of the largest communications services agents in the country.
Under the terms of the purchase agreement, the initial consideration for
the transaction is approximately $13.6 million, consisting of $7.1 million in
cash and PentaStar common stock and the assumption of approximately $6.5
million in debt. In addition, under an earn-out provision in the agreement,
Telecomm could potentially earn up to $8.9 million in additional compensation
based on financial results for the period of April 1, 2000 through March 31,
2001, bringing the total value of the deal to $22.5 million. The definitive
agreement is subject to approval by the shareholders of Telecomm Industries.
Paul Satterthwaite, the President and CEO of Telecomm Industries
commented, "The sale of the network services division is a significant event
for the company. Not only does it provide cash consideration, but it also
eliminates the majority of our current and long-term debt. In addition, it
provides an opportunity to generate substantial value during the earn-out
period, and most importantly allows our shareholders to retain the ability to
fully capitalize on the public market valuation of the network agency
business. Telecomm will now be in a position to focus on the completion of
the Internet strategy commenced last year with the creation of its subsidiary
NetVision.Com. The telecommunications and data equipment installation and
service business of Telecomm provides the platform to launch Internet
infrastructure services to the customer base in our five state region and
beyond."
Telecomm Industries Corp. is one of the nation's largest distributors of
voice and data services for Ameritech and BellSouth. Telecomm combines these
services with products from world-class manufacturers to provide single
source telecommunications and computing solutions to its business customers.
Telecomm owns approximately eighty-five percent of its subsidiary,
NetVision.Com, which operates as an Internet service provider and focuses on
web hosting, e-commerce and other business-to-business applications and
services. For more information please visit the company's website at
www.tcmm.com.
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PentaStar designs, procures and facilitates the installation and use of
communications services solutions that best meet customers' specific
requirements and budgets. PentaStar was formed in March 1999 to become a
national communications services agent and specializes in being the single
source provider of total communication solutions for its business customers.
PentaStar's common stock is traded on the Nasdaq SmallCap Market under
the ticker symbol PNTA. For more complete information about PentaStar,
contact PentaStar Communications, Inc., 1522 Blake Street, Denver, Colorado
80202, (303) 825-4400, visit the company's website at www.pentastarcom.com or
send an e-mail to [email protected]
Certain statements contained in this report that are not historical
facts are forward-looking statements that are subject to certain risks and
uncertainties that could cause actual results to differ materially from those
set forth in the forward-looking statements. The execution of a definitive
agreement is merely one of a number of necessary steps prior to the closing
of a transaction. The Company makes no representation with regard to final
completion of the merger. Reference is made to the Company's filings with
the Securities and Exchange Commission, including the Company's annual report
for fiscal 1999 on Form 10-KSB. Investors should read this release in
conjunction with these filings for a description of these and other factors
that could cause actual results to differ materially from those in the
forward-looking statements.
