<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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) March 15, 1997
United Payphone Services, Inc.
(Exact name of registrant as specified in its charter)
Nevada 0-24138 88-0232816
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
105 East Ellis, Tempe, Arizona 85282
(Address of principal executive offices) (Zip Code)
Registrants telephone number, including area code (602) 839-9968
N/A
(Former name or former address, if changed since last report)
<PAGE> 2
Item 1.Change in Control of Registrant
In a communication dated February 27, 1997, United Payphone Services,
Inc. (the "Company") learned from Nathan W. Drage, P.C., attorney for Teletek,
Inc. ("Teletek") that on December 1, 1996, Dingaan Holdings, S.A. ("Dingaan")
a Bahamas corporation purchased 992,065 shares of Common Stock, representing
18.8% of the Company's voting securities, and 727 shares of its Series a 6%
convertible preferred stock ("Preferred," together with the Common Stock the
"Stock"), representing 100% of the Company's outstanding preferred shares from
Teletek. AS of January 27, 1997, the 727 shares of preferred stock were
convertible into approximately 14,496,933 shares of Common Stock or 78%
ownership of the outstanding voting securities of the Company. Also in
connection with this transaction, Dingaan acquired two promissory notes issued
by the Company to Teletek in the amounts of $61,519 and $125,683 (the
"Notes"). The Stock and Notes were purchased for a price of $2,000,000 paid
through the forgiving of a loan in the amount of $2,000,000 from Dingaan to
Teletek evidenced by a promissory note dated August 27, 1996. Prior to its
purchase of the Stock and the Note, Dingaan did not beneficially own any
equity interest in the Company.
The Company received a request from Dingaan to transfer beneficial
ownership of the Preferred form Teletek to Dingaan on March 13, 1997. Such
transfer was approved by the Company on March 15, 1997 and, acting as its own
transfer agent with respect to the Preferred, such transfer was effected by
the Company on that date effectively changing control of the Company.
Item 7.Financial Statements and Exhibits
Exhibits:
Exhibit Description
2.1 Stock Purchase Agreement between Teletek, Inc. and
Dingaan Holdings, S.A. (without Exhibits or Schedules).
<PAGE> 3
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made and entered into
as of the 1st day of December, 1996, by and between Teletek, Inc. a Nevada
corporation ("Seller") and Dingaan Holdings S.A., a Bahamas corporation
("Purchaser").
RECITALS
A. Seller is the owner of (I) 992,065 shares (the "Common Shares")of
common stock $.001 par value (the "Common Stock") of United Payphone Services,
Inc., a Nevada corporation (the "Company"), evidenced by certificate no. 2821
dated May 8, 1995, and (ii) 727 shares (the "Preferred Shares") of class A
preferred stock, $.001 par value (the "Preferred Stock"), of the Company,
evidenced by certificate no. A-1 dated December 1, 1996. The Common Shares
represent approximately 19% of the total outstanding Common Stock of the
Company, and the Preferred Shares represent all of the outstanding Preferred
Stock of the Company. The Common Shares and the Preferred Shares are
hereinafter collectively referred to as the "Shares".
B. Purchaser previously made a loan (the "Loan") to Seller in the
principal amount of Two Million and No/100ths Dollars ($2,000,000.00), as
evidenced by that certain Promissory Note (the "Note") dated August 22, 1996,
attached hereto as Exhibit A. The Loan, which bears interest at 8.5% per
annum, is due in full on August 22, 1999. The Loan plus all accrued and
unpaid interest through the date of this Agreement, as well as all other
obligations of Seller under the Loan, are hereinafter collectively referred to
as the "Indebtedness".
C. Seller desires to sell the Shares to Purchaser upon the terms and
conditions hereinafter set forth, and Purchaser desires to acquire the Shares
upon such terms and conditions.
NOW THEREFORE, for and in consideration of the premises and mutual
covenants, agreements, understandings, undertakings, representations,
warranties and promises, and subject to the conditions hereinafter set forth,
and intending to be legally bound thereby, the parties do hereby covenant and
agree that the Recitals set forth above are true and accurate, and further
covenant and agree as follows:
ARTICLE 1
PURCHASE AND SALE OF SHARES
1.1 PURCHASE AND SALE
Subject to the provisions hereof, on the Closing Date (as hereinafter
defined), Seller shall sell, transfer, assign and deliver the Shares to
Purchaser, and Purchaser shall buy the Shares from Seller.
<PAGE> 4
1.2 CONSIDERATION
In consideration of the sale of the Shares to Purchaser, Purchaser,
Purchaser hereby forgives and cancels all of the Indebtedness as evidenced by
the Note.
ARTICLE II
CLOSING
2.1 CLOSING DATE
The closing (the "Closing") under this Agreement for the purchase and
sale of the Shares shall be at the offices of the Company, unless otherwise
agreed to in writing by each of the parties hereto, on December 1, 1996 (the
"Closing Date"). The Closing shall take place at 10:00 a.m. on the Closing
Date.
2.2 SELLER'S CLOSING DOCUMENTS
At the Closing, Seller shall deliver to Purchaser (I) certificates
representing all of the Common Shares, together with an assignment of the
Common Shares executed by Seller; and (ii) a certificate(s) representing the
Preferred Shares, together with an assignment of the Preferred Shares executed
by Seller.
2.3 PURCHASER'S CLOSING DOCUMENT
At the Closing, Purchaser shall deliver to Seller the Note, marked "Paid
in Full" across the face of the Note and signed by the Company.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby makes the following representations and warranties to
Purchaser, and Seller warrants that the following are true and accurate on the
date hereof and will be true and accurate on the Closing Date:
3.1 TITLE TO SHARES
Seller is the record and beneficial owner of the Shares, free and clear
of all liens, encumbrances, security agreements, options, charges,
restrictions or any other claims of any type, kind or nature whatsoever.
3.2 AUTHORITY
Seller has the full right, power, legal capacity and authority to enter
into, and perform its obligations under this Agreement, including the sale and
delivery of the Shares to Purchaser.
<PAGE> 5
3.3 BINDING NATURE OF AGREEMENT
This Agreement constitutes the valid and binding obligation of Seller,
enforceable against Seller in accordance with its terms.
3.4 NO VIOLATION
Neither the execution and delivery of this Agreement, the consummation of
the transactions contemplated hereby, nor the fulfillment of the terms hereof
by Seller will conflict with, or result in a breach of or default under, any
of the terms or provisions of: (I) any agreement, note, indenture, mortgage,
deed of trust, instrument of lease or franchise to which Seller is a party or
by which it or any of its assets or properties are bound; or (ii) any law,
judgment, order, arbitration award, rule, regulation, ordinance, writ,
injunction or decree of any governmental agency or instrumentally or court
applicable to or having jurisdiction over Seller or an of its assets or
properties.
3.5 VALID CORPORATE ORGANIZATION AND GOOD STANDING
Seller is a corporation duly organized, validly existing and in good
standing under the laws of the State of Nevada, and has the corporate power
and authority necessary and appropriate to own its properties and to engage in
the business in which it is presently engaged.
3.6 NO COMMISSION OR FINDER'S FEE
Seller has not dealt with any broker or finer in connection with any of
the transactions contemplated by this Agreement, and to the best of its
knowledge, no broker or other person is entitled to any commission or finer's
fee in connection with such transactions.
3.7 NO REPRESENTATIONS UNTRUE
No representation made by Seller in this Agreement contains or will
contain any untrue statement of material fact or omit to state any material
fact known to Seller necessary to make any statement, warranty or
representation not misleading to Purchaser. Seller knows of no material facts
or conditions adversely affecting the value of the Shares which have not been
disclosed to Purchaser. Except as set forth in this Agreement, Seller does
not make any representations or warranties to Purchaser.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby makes the following representations and warranties to
Seller, and Purchaser warrants that the following are true and accurate on the
date hereof and will be true and accurate at the Closing Date.
<PAGE> 6
4.1 HOLDER OF NOTE
Purchaser is the sole holder of the Note, free and clear of all liens,
encumbrances, security agreements, assignments, charges, restrictions or any
other claims of any type kind or nature whatsoever.
4.2 AUTHORITY
Purchaser has the full right, power, legal capacity and authority to
enter into and perform its obligations under this Agreement, including the
forgiveness and cancellation of the Indebtedness.
4.3 BINDING NATURE OF AGREEMENT
This Agreement constitutes the valid and binding obligation of Purchaser
enforceable against Purchaser in accordance with its terms.
4.4 NO VIOLATION
Neither the execution and delivery of this Agreement, the consummation of
the transactions contemplated hereby, nor the fulfillment of the terms hereof
by Purchaser will conflict with, or result in a breach of or default under,
any of the terms or provisions of (I) any agreement, note, indenture,
mortgage, deed of trust, instrument, lease or franchise to which Purchaser is
a party or by which it or any of its assets or properties are bound; or (ii)
any law, judgment, order, arbitration award, rule, regulation, ordinance,
writ, injunction or decree of any governmental agency or instrumentality or
court applicable to or having jurisdiction over Purchaser or any of its assets
or properties.
4.5 VALID CORPORATE ORGANIZATION AND GOOD STANDING
Purchaser is a corporation duly organized, validly existing and in good
standing under the laws of the Bahamas, and has the corporate power and
authority necessary and appropriate to own its own properties and to engage in
the business in which it is presently engaged.
4.6 NO RELIANCE
PURCHASER ACKNOWLEDGES THAT SELLER HAS NOT MADE AND DOES NOT MAKE ANY
REPRESENTATIONS OR WARRANTIES CONCERNING THE PAST OR FUTURE PERFORMANCE OF THE
COMPANY. IN MAKING ITS INVESTMENT DECISION, PURCHASER HAS RELIED UPON ITS OWN
EXAMINATION OF THE COMPANY, INCLUDING THE MERITS AND RISKS INVOLVED.
PURCHASER HAS CONSULTED ITS OWN ATTORNEY, BUSINESS ADVISOR OR TAX ADVISOR AS
TO LEGAL, BUSINESS OR TAX ADVICE. PURCHASER POSSESSES SUFFICIENT BUSINESS
PROBITY AND SOPHISTICATION TO ASSESS THE RISKS OF PURCHASING THE SHARES OR HAS
CONSULTED WITH PERSONS OF ITS OWN CHOOSING WHO POSSESS SUCH PROBITY AND
SOPHISTICATION TO ADVISE PURCHASER OF THE RISKS ATTENDANT TO THE INVESTMENT
CALLED FOR UNDER THIS AGREEMENT.
<PAGE> 7
4.7 INVESTMENT INTENT
Purchaser is acquiring the Shares for its own account for investment and
not with a view to the resale or distribution thereof, and Purchaser
understands the nature and effect of this representation. {Purchaser has been
informed by Seller that the Shares have not been registered under the
Securities Act of 1933 or the securities laws of any state, and may not be
offered, sold or transferred in the absence of such registration or an
exemption from such registration}.
4.8 NO COMMISSION OR FINDER'S FEE
Purchaser has not dealt with any broker or finer in connection with any
of the transactions contemplated by this Agreement, and to the best of its
knowledge, no broker or other person is entitled to any commission or finder's
fee in connection with such transactions.
4.9 NO REPRESENTATIONS UNTRUE
No representation made by Purchaser in this Agreement contains or will
contain any untrue statement of material fact or omit to state any material
fact known to Purchaser necessary to make any statement, warranty or
representation not misleading to Seller. Purchaser knows of no material facts
or conditions adversely affecting the Note which have not been disclosed to
Seller. Except as set forth in this Agreement, Purchaser does not make any
representations or warranties to Seller.
ARTICLE V
COSTS
Purchaser and Seller shall each pay all costs and expenses incurred or to
be incurred by each of them respectively in negotiating and preparing this
Agreement and in taking whatever actions may be necessary or appropriate to
consummate the transactions contemplated by this Agreement, including the
costs of obtaining any consents or approvals.
ARTICLE VI
MISCELLANEOUS
6.1 CAPTIONS
The subject headings or captions of the sections and subsections of this
Agreement are included only for purposes of convenience and shall not affect
the construction or interpretation of an provisions contained herein.
6.2 ENTIRE AGREEMENT
This Agreement (together with all exhibits, documents, agreements and
instruments executed or furnished in connection herewith) constitutes the
entire agreement between the parties pertaining to the subject matter hereof,
and supersedes any and all prior or contemporaneous written or oral
negotiations, agreements, representations and understandings of the parties
with respect to such subject matter.
<PAGE> 8
6.3 EXPENSES
If any legal action or any arbitration or other proceeding is brought for
the enforcement of this Agreement, or because of an alleged dispute, breach,
default, or misrepresentation in connection with any of the provisions of this
Agreement, the successful or prevailing party or parties shall be entitled to
recover reasonable attorneys' fees and other costs incurred in that action or
proceeding, in addition to any other relief to which it may be entitled.
6.4 NOTICE
Any and all notices required under this Agreement shall be in writing and
shall be either (I) hand-delivered; (ii) mailed, first-class postage prepaid,
certified mail, return receipt requested; or (iii) delivered via a nationally
recognized overnight courier service addressed to:
Seller: Teletek, Inc.
1771 E. Flaming Road
Suite 200B
Las Vegas, Nevada 89119
Attention: President
Purchaser: Dingaan Holdings S.A.
Enro Canadian Center
First Floor
Marlborough Street
P.O. Box N3802
Nassau, Bahamas
All notices hand-delivered or delivered via overnight courier shall be
deemed delivered as of the date actually delivered. All notices mailed shall
be deemed delivered as of three (3) business days after the date postmarked.
Any changes in any of the addresses listed herein shall be made as provided in
this Section 6.4.
6.5 MODIFICATION, AMENDMENT OR WAIVER
This Agreement may not be amended, supplemented or otherwise modified,
and none of its terms may be waived, unless such amendment, supplement,
modification or waiver is in writing and executed by the party or parties to
be bound thereby. The failure of any party at any time or times to require
performance of any provision hereof shall not affect the right of such party
at a later time to enforce the same and no waiver of any term or provision
hereof on any one occasion shall be deemed to be a waiver of the same or any
other provision hereof at any subsequent time or times.
<PAGE> 9
6.6 BINDING EFFECT; ASSIGNMENT
This Agreement shall be binding upon, and shall ensure to the benefit of
and be enforceable by, the parties hereto, and their respective heirs,
successors, assigns and legal representatives; provided, however, that no
assignment of any rights or delegation of any obligations provided for herein
may be made by either party to this Agreement without the prior written
consent of the other party.
6.7 CONSTRUCTION
This Agreement shall be construed in accordance with its intent and
without regard to any presumption or any other rule requiring construction
against the party causing the same to be drafted.
6.8 GOVERNING LAW
The laws of the State of Nevada shall govern the validity, performance
and enforcement of this Agreement and the courts of Nevada shall have the sole
and exclusive jurisdiction over any matter brought under or by reason of this
Agreement.
6.9 COUNTERPARTS
This Agreement may be executed in counterparts, each of which shall be
deemed an original and all of which taken together shall constitute the same
instrument.
6.10 NO THIRD PARTIES BENEFITTED
This Agreement is made and entered into for the sole protection and
benefit of Purchaser and Seller, their successors and assigns, and no other
person or persons shall have any right of action hereon.
6.11 SEVERABILITY
If any provision of this Agreement, or any portion of any provision,
shall be deemed invalid or unenforceable for any reason whatsoever, such
invalidity or unenforceability shall not affect the enforceability and
validity of the remaining provisions hereof.
6.12 TIME OF THE ESSENCE
At all times stated herein, time shall be of the essence.
<PAGE> 10
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
on the date first set forth above.
"SELLER" "PURCHASER"
TELETEK, INC., a Nevada corporation DINGAAN HOLDINGS S.A., a Bahamas
corporation
By: /s/ John M. Vergiels By: /s/
President Its: Attorney in Fact
<PAGE> 11
AMENDMENT TO STOCK PURCHASE AGREEMENT
In order to correct a drafting exclusion, the Stock Purchase Agreement
("the Agreement") entered into as of the 1st day of December, 1996, by and
between Teletek, Inc., a Nevada corporation, and Dingaan Holdings S.A., a
Bahamas corporation is hereby amended as follows:
Paragraph A of Recital identifying the securities purchased should and
does include two promissory notes, one in the amount of $61,519 and one in the
amount of $125,683. Said notes, for the purposes of simplicity, shall be
included in the definition of "Shares" as used in this Agreement.
TELETEK, INC.
/s/ John M. Vergiels
John M. Vergiels
<PAGE> 12
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.
UNITED PAYPHONE SERVICES, INC.
Date: March 26, 1997 By: /s/ David Westfere
Chief Executive Officer
and Principal Financial Officer
