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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
SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported) September 16, 1996
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PORTACOM WIRELESS, INC.
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(Exact name of registrant as specified in its charter)
British Columbia, Canada 0-23228 N/A
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(State or other jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
8055 W. Manchester Avenue, Suite 730, Playa del Rey, California 90293
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(Address of principal executive offices)
Registrant's telephone number, including area code: (310) 448-4140
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(Former name or former address, if changed since last report
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Item 5. Other Events
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On May 28, 1996, the Registrant issued a news release announcing an
acquisition agreement with Asian American Telecommunications Corporation, a
Cayman Islands corporation ("AAT"). A copy of the news release is attached
hereto as Exhibit 1 and incorporated herein by reference.
On July 18, 1996, the Registrant issued a news release announcing revised
terms of the acquisition agreement with AAT. A copy of the news release is
attached hereto as Exhibit 2 and incorporated herein by reference.
On September 16, 1996, the Registrant issued a news release announcing that
it had elected to receive a direct ownership position in AAT rather than
completing the previously reported transaction with AAT. A copy of the news
release is attached hereto as Exhibit 3 and incorporated herein by reference.
Item 7. Exhibit Index
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99.1. News release issued by the Registrant on May 28, 1996.
99.2. News release issued by the Registrant on July 18, 1996.
99.3. News release issued by the Registrant on September 16, 1996.
SIGNATURES
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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 thereunto duly authorized.
Dated: September 20, 1996 PORTACOM WIRELESS, INC.
By: /s/ J. Michael Christiansen
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J. Michael Christiansen
Chief Financial Officer
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EXHIBIT INDEX
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<CAPTION>
Exhibit Description Page
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99.1 News release issued by the Registrant on May 28, 1996. 4
99.2 News release issued by the Registrant on July 18, 1996. 8
99.3 News release issued by the Registrant on September 16, 1996. 11
</TABLE>
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EXHIBIT 99.1
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PORTACOM WIRELESS, INC.
8055 W. Manchester Avenue, Suite 730
Playa del Rey, California 90293
(310) 448-4140
FOR IMMEDIATE RELEASE
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May 28, 1996 Investor Relations International:
Tom Madden (800) 941-1558
VSE: PCW
OTC: PCWIF http://www.portacom.com
PORTACOM WIRELESS AGREES TO ACQUIRE
ASIAN AMERICAN TELECOM CORPORATION
Playa del Rey, CA -- PortaCom Wireless, Inc. announced today the signing of an
agreement to acquire all of the outstanding shares of Asian American
Telecommunications Corporation ("AAT"), a Los Angeles-based telecom services
developer. The Company has agreed, subject to certain approvals and conditions
outlined herein, to issue a total of 25.5 million common shares to the
shareholders of AAT, which will result in the Company having approximately 43
million shares outstanding on a fully diluted basis, including approximately 3
million shares issuable upon the closing of certain other previously announced
pending transactions. The agreement also calls for the Company to fund the
ongoing operating expenses and contractual obligations of AAT until the
acquisition closes and, subsequent to the closing of an equity financing, to
retire the outstanding liabilities of AAT in an amount not to exceed
US$1,455,000.
In connection with the transaction, Mr. Max E. Bobbitt, President and CEO of
AAT, has agreed to join the Board of Directors of the Company as Chairman. In
1995, Mr. Bobbitt retired from ALLTEL Corporation, a NYSE and Fortune 500
telecommunications and information services company. During his twenty-four
year career with ALLTEL, Mr. Bobbitt served as a director and held various
executive-level positions including President, COO and CFO. Additionally, Mr.
Bobbitt currently serves as a director of WorldCom, Inc., the fourth-largest
long distance company in the United States. Mr. Bobbitt owns or controls
approximately 41% of AAT and is to receive a salary from the Company of
US$15,000 per month for acting as its Chairman.
Douglas C. MacLellan, President and CEO of the Company, will immediately assume
the position of Vice Chairman of AAT to assist in the finalization of
telecommunications contracts in China currently under negotiation by AAT. Mr.
MacLellan owns approximately 3% of AAT.
The acquisition agreement between the Company and AAT is subject to appropriate
regulatory approval and is subject to AAT having completed a joint venture
contract in China so as to form a Chinese company ("China Co.") whose business
shall be a significant telecommunications project in China. The acquisition
agreement is also subject to, among other things, the following:
1. respective shareholder approvals (and in particular, approval of the
Company's shareholders to the absolute change in control of the Company
resulting from the issuance of the 25.5 million shares of the Company);
<PAGE>
PortaCom Wireless, Inc.
News Release
May 28, 1996
Page 2 of 3
2. a fairness opinion from a qualified investment banking firm satisfactory to
the Company as to the fairness of the transaction from a financial point of
view to the shareholders of the Company;
3. certain systems building arrangements being in place with China Co.;
4. requisite approvals from the Ministry of Foreign Trade and Commerce
("MOFTEC") of the Peoples Republic of China ("PRC") and such other foreign
governmental agencies as may be required;
5. a business license for China Co. having been received from the State
Administration of Industry and Commerce of the PRC;
6. the listing of the Company's shares for trading on the NASDAQ system.
After receipt of the required shareholder and regulatory approvals, the AAT
acquisition will close with the 25.5 million common shares of the Company to be
issued as follows:
1. 8.5 million shares upon AAT signing a joint venture contract and receiving
a business license requiring no additional governmental approval respecting
a mobile wireless telecom venture in a specified province of the PRC (or an
equivalent venture) (the "First Venture");
2. 17 million shares upon AAT signing a joint venture contract and receiving a
business license and approval from MOFTEC respecting a local service
telecom venture in a second specified province of the PRC covering a market
of at least 50 million in population (or an equivalent venture) (the
"Second Venture").
The acquisition may close with either of the First Venture or the Second Venture
being finalized. In the event the acquisition is closed based upon the Second
Venture, or upon finalization within one year of contracts covering markets
totaling at least 50 million in population, the balance of the remaining 25.5
million shares will be issued to the AAT shareholders. The Company expects the
aforesaid conditions to be satisfied and the Company's acquisition of AAT to be
closed during the third quarter of 1996.
The Company announced by news release dated May 8, 1996 that it had arranged a
brokered private placement of US$20,130,000 of special warrants at US$3.30 per
special warrant. The Company has now determined that the private placement will
be non-brokered and placed directly by the Company. In this regard, the Company
proposes to pay finder fees of up to 5% of the gross proceeds on certain of the
placements. The private placement price will remain at US$3.30, however, the
Company will issue Units rather than special warrants. Each Unit shall consist
of one common share and one-half warrant, as described in the Company's May 8th
news release. However, because special warrants are not being issued, there
shall be no provision to increase the number of shares and warrants in the event
a final prospectus has not been cleared within 150 days after closing the
placement.
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PortaCom Wireless, Inc.
News Release
May 28, 1996
Page 3 of 3
It is anticipated that the proceeds of this financing will be advanced to the
Company upon the execution of either the First Venture or the Second Venture
(for the purpose of funding the interim operations and contractual obligations
of AAT) and prior to the closing of the private placement and the acquisition of
AAT by the Company.
Because the private placement of the Units will not receive regulatory approval
and therefore will not be issued until the acquisition of AAT by the Company has
closed, in the event that the acquisition is not closed on or before December
31, 1996, advances made to the Company in connection with the private placement
will be converted into equity of AAT based on a valuation of US$84 million for
AAT on a "pre-financing" basis.
PortaCom Wireless, Inc. is engaged in ventures as a developer and operator of
companies providing cellular, wireless, and PSTN telecommunications services in
selected developing world markets. PortaCom intends to make significant
investments primarily in wireless, cellular, PSTN, and long distance networks in
order to provide coverage and high-quality service in selected emerging markets.
PortaCom's business development strategy is focused on emerging markets in Asia-
Pacific, Eastern Europe and Latin America.
ON BEHALF OF THE BOARD OF DIRECTORS
/s/ J. MICHAEL CHRISTIANSEN
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J. Michael Christiansen
Executive Vice President and CFO
The Vancouver Stock Exchange has not reviewed and does not accept responsibility
for the adequacy or accuracy of this release.
THIS NEWS RELEASE DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY THE ABOVE REFERENCED SECURITIES IN ANY JURISDICTION OR TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION IN SUCH
JURISDICTION.
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EXHIBIT 99.2
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PORTACOM WIRELESS, INC.
8055 W. Manchester Avenue, Suite 730
Playa del Rey, California 90293
(310) 448-4140
FOR IMMEDIATE RELEASE
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July 18, 1996 Contact: Douglas MacLellan
(310) 448-4140
VSE: PCW
OTC: PCWIF http://www.portacom.com
PORTACOM WIRELESS ANNOUNCES AAT FINANCING;
AGREES TO ADJUST TERMS OF AAT ACQUISITION
Playa del Rey, CA -- PortaCom Wireless, Inc. announced that Asian American
Telecommunications Corporation ("AAT") has completed a total of approximately
US$25,000,000 (C$34,000,000) in financing for its telecommunications joint
venture in Sichuan province, China. This AAT financing is comprised of an equity
private placement of approximately US$15,000,000 and a US$10,000,000 convertible
credit facility. These direct investments in AAT have been arranged in lieu of
completing the Company's previously announced US$20 million private placement.
Further to the Company's news release of May 28, 1996, the Company announced
that it has agreed to adjust the terms of its acquisition agreement with AAT to
take into account the above described financing. As a result, the Company has
agreed, subject to certain approvals and conditions, to issue 38.0 million
common shares to the current AAT shareholders plus up to an additional 12.5
million common shares to the new AAT investors. This will result in the Company
having approximately 62.6 million primary shares outstanding, or approximately
72.3 million shares on a fully diluted basis. The fully diluted shares include
approximately 6.3 million new warrant shares to be issued in exchange for
warrants held by new AAT investors. The revised acquisition agreement calls for
AAT to fund its own operating expenses, contractual obligations and other
liabilities until the acquisition closes. The Company expects the acquisition
of AAT to be closed during the third or fourth quarter of 1996.
Further to the Company's announcement dated October 20, 1995, the Company
announces that it has terminated two pending acquisitions that had not yet
received regulatory approval, thereby eliminating the potential issuance of
approximately 3.1 million new shares.
In addition, during the interim period prior to the closing of the AAT
acquisition, Max E. Bobbitt, Lawrence A. McLernon and Larry E. Wolfe have agreed
to resign from their respective positions with the Company in order to focus all
of their professional efforts with AAT on the development of new and existing
joint venture projects in China. Upon the closing of the acquisition, Messrs.
Bobbitt, McLernon and Wolfe have also agreed to enter into employment agreements
for minimum three-year terms to operate the combined PortaCom/AAT enterprise as
Chairman and CEO, President and COO, and Executive Vice President and CFO,
respectively.
Mr. Bobbitt, President and CEO of AAT, retired from ALLTEL Corporation in 1995.
ALLTEL is a NYSE and Fortune 500 telecommunications and information services
company. During his twenty-
<PAGE>
PortaCom Wireless
News Release
July 18, 1996
Page 2 of 2
four year career with ALLTEL, Mr. Bobbitt served as a director and held various
executive officer positions including President, COO and CFO. Additionally, Mr.
Bobbitt currently serves as a director of WorldCom, Inc., the fourth-largest
long distance company in the United States.
Mr. McLernon is the founding partner and Senior Managing Director of McLernon &
Associates, Ltd. ("M&A"), a business development and management consulting firm
located in Columbus, Ohio. He is also a co-founder and former CEO of LiTel
Telecommunications (now LCI International, Inc.), a long distance service
provider. Under Mr. McLernon's direction and leadership, LiTel/LCI grew from a
pure start-up venture to over $250 million in revenues and was one of the first
companies to build and operate a fiber optic network for long distance
transmissions.
Mr. Wolfe is a Managing Director of M&A and was a co-founder of LiTel. He
served as Chief Financial Officer of LiTel/LCI from its inception through late
1993 and was responsible for financings totaling over $1 billion, including an
initial public offering and a subsequent preferred stock offering.
AAT and China Huaneng Technology Development Corporation ("China Huaneng") have
entered into a joint venture named Huaneng American Telecom Co., Ltd. ("HAT").
HAT has entered into a Network System Cooperation Contract with China United
Telecommunications Corporation ("China Unicom"). Under the terms of the
contract, HAT will provide financial, engineering and technical support for
China Unicom's construction and operation of a Public Switched
Telecommunications Network (PSTN) in Sichuan province. The 1996 initial project
will require approximately US$29.5 million to construct China Unicom's initial
PSTN network in the capital city of Chengdu in Sichuan province. AAT expects
all regulatory approvals to be obtained and the contracts to become operational
within the next several weeks.
PortaCom Wireless, Inc. is engaged in ventures as a developer, financier or
operator of companies providing cellular, wireless, and PSTN telecommunications
services in selected developing world markets. PortaCom intends to make
significant investments primarily in wireless, cellular, PSTN, and long distance
networks in order to provide coverage and high-quality service in selected
emerging markets. PortaCom's business development strategy is focused on
emerging markets in the People's Republic of China and Vietnam.
ON BEHALF OF THE BOARD OF DIRECTORS
/s/ DOUGLAS C. MACLELLAN
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Douglas C. MacLellan
President and CEO
The Vancouver Stock Exchange has not reviewed and does not accept responsibility
for the adequacy or accuracy of this release.
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EXHIBIT 99.3
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PORTACOM WIRELESS, INC.
8055 W. Manchester Avenue, Suite 730
Playa del Rey, California 90293
(310) 448-4140
FOR IMMEDIATE RELEASE
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September 16, 1996 Contact: Douglas MacLellan
(310) 448-4140
or
VSE: PCW Tom Madden
OTC: PCWIF (800) 941-1558
PORTACOM WIRELESS AGREES TO RECEIVE EQUITY STAKE
IN ASIAN AMERICAN TELECOMMUNICATIONS
Playa del Rey, CA -- Further to the Company's news release dated July 18, 1996,
PortaCom Wireless, Inc. announced that, due to significant tax and regulatory
considerations, it has elected to receive a direct ownership position in Asian
American Telecommunications Corporation ("AAT") rather than completing the
proposed merger between AAT and the Company. This direct ownership transaction
will be made up of 2,000,000 common shares and three-year warrants to acquire
4,000,000 common shares of AAT at a price of US$4.00 per share, plus an
immediate payment of US$1,000,000 in cash from AAT to PortaCom.
This transaction does not require Vancouver Stock Exchange or other regulatory
approval. The 2,000,000 common shares of AAT will be held in escrow until
January 1, 1999 to cover potential liabilities related to this transaction.
The Company's equity stake in AAT is currently equivalent to approximately
17.4%, on a fully diluted basis. AAT has a total of approximately 34.6 million
shares outstanding on a fully diluted basis. The Company currently has
approximately 11.9 million common shares issued and outstanding, and 15.4
million shares on a fully diluted basis.
AAT and China Huaneng Technology Development Corporation ("China Huaneng") have
entered into a joint venture named Sichuan Tai Li Feng Telecommunications
Company, Ltd. ("STT"), formerly known as HAT. STT has entered into a Network
System Cooperation Contract with China United Telecommunications Corporation
("China Unicom"). Under the terms of the contract, STT will provide financial,
engineering and technical support for China Unicom's construction and operation
of a Public Switched Telecommunications Network (PSTN) in Sichuan province. The
1996 project will require approximately US$29.5 million for construction of
China Unicom's initial PSTN network in the capital city of Chengdu. Sichuan has
an estimated population of 120 million. The capital city of Chengdu and the City
of Chongqing have a combined population of approximately 25 million.
The STT Joint Venture has received all necessary approvals from the Sichuan
Commission of Foreign Trade and Economic Cooperation ("COFTEC") and the State
Administration of Industry and Commerce ("SAIC") to operate its business in
Sichuan province, China.
<PAGE>
PortaCom Wireless
News Release
September 16, 1996
Page 2 of 2
PortaCom Wireless, Inc. is actively pursuing business ventures as a developer,
financier and operator of companies providing cellular, wireless, and PSTN
telecommunications services in selected developing world markets. PortaCom
intends to make significant investments primarily in wireless, cellular, PSTN,
and long distance networks in order to provide coverage and high-quality service
in selected emerging markets. PortaCom's current business development strategy
is highly focused on Vietnam, Cambodia and other emerging market opportunities.
ON BEHALF OF THE BOARD OF DIRECTORS
/s/ DOUGLAS C. MACLELLAN
----------------------------------------
Douglas C. MacLellan
President and CEO
The Vancouver Stock Exchange has not reviewed and does not accept responsibility
for the adequacy or accuracy of this release.
