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
January 3, 1997
Date of Report
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(Date of earliest event reported)
APPLIED VOICE TECHNOLOGY, INC.
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(Exact name of registrant as specified in its charter)
Washington 0-25186 91-1190085
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(State or other (Commission File No.) (IRS Employer
jurisdiction of Identification No.)
incorporation)
11410 N.E. 122nd Way
Kirkland, Washington 98034
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(Address of principal executive offices, including zip code)
(206) 820-6000
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(Registrant's telephone number, including area code)
Page 1 of 5
Exhibit Index on Page 5
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Item 5. Other Events
On January 3, 1997, Applied Voice Technology, Inc. (the "Company")
completed an acquisition of selected assets (the "Acquired Assets") of Telcom
Technologies, Inc. ("Telcom") pursuant to an Asset Purchase Agreement, dated
December 19, 1996, by and between the Company and Telcom (the "Purchase
Agreement"). The Acquired Assets include Telcom's intellectual property,
contracts, customer agreements, receivables, inventory and fixed assets. In
connection with the transaction, Telcom ceased all of its business operations as
of January 3, 1997. Certain of Telcom's engineering, manufacturing, sales and
customer service employees have accepted employment with the Company.
The purchase price for the Acquired Assets (the "Purchase Price")
consisted of (i) $3,300,000 in cash, $200,000 of which was deposited in escrow
to satisfy potential claims by the Company for indemnification under the
Purchase Agreement and $100,000 of which will be retained by the Company until
February 3, 1997 to effect a potential adjustment of the Purchase Price, and
(ii) warrants to purchase up to 100,000 shares of Common Stock, par value $.01
per share, of the Company (the "Warrants"). The Warrants were issued to
shareholders of Telcom on January 3, 1997, have an exercise price of $13.36 per
share and may be exercised at any time prior to January 3, 2002, except that the
Warrants will terminate and be of no further force and effect following a change
in control of the Company whereby (a) the Company is a party to a merger,
consolidation or reorganization as a result of which the Company owns less than
50% of the voting equity securities of the surviving corporation or (b)
substantially all of the assets of the Company are sold. Neither the Warrants
nor the underlying Common Stock were registered under the Securities Act of
1933, as amended, and may be resold only pursuant to Rule 144 or other
applicable exemptions from registration.
A form of Warrant and a press release issued by the Company to announce
the signing of the Purchase Agreement are attached as exhibits to this report
and are incorporated herein by reference. The description of the Warrants herein
do not purport to be complete and is qualified in its entirety by the provisions
of the Warrants.
The Company's Common Stock is quoted on the Nasdaq National Market
under the symbol "AVTC," and the Company maintains a site on the World Wide Web
at www.appliedvoice.com.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits
Exhibit Number Description
4.1 Form of Warrant, dated January 3, 1997, issued
by the Company to shareholders of
Telcom Technologies, Inc.
99.1 Press Release issued December 20, 1996.
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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.
APPLIED VOICE TECHNOLOGY, INC.
Dated: January ___, 1997
By Roger A. Fukai
___________________________________
Roger Fukai, Chief Financial Officer
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description
4.1
Form of Warrant, dated January 3, 1997, issued by the
Company to shareholders of Telcom Technologies, Inc.
99.1 Press Release issued December 20, 1996.
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933
ACT"), OR THE SECURITIES LAWS OF ANY OTHER JURISDICTION, AND NO INTEREST THEREIN
MAY BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A
REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER THE 1933
ACT OR, UNDER CERTAIN CIRCUMSTANCES, AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY THAT SUCH TRANSACTION WILL NOT BE IN VIOLATION OF APPLICABLE SECURITIES
LAWS.
ISSUED: JANUARY 3, 1997 WARRANT TO PURCHASE number
VOID AFTER FIVE YEARS SHARES OF COMMON STOCK
APPLIED VOICE TECHNOLOGY, INC.
COMMON STOCK PURCHASE WARRANT
For value received and subject to the terms and conditions hereof, name
(the "Holder") is entitled to purchase up to number fully paid and nonassessable
shares of the Common Stock, par value $.01 per share, of APPLIED VOICE
TECHNOLOGY, INC., a Washington corporation (the "Company"), at the price per
share of $13.36 (the "Exercise Price") (such number of shares and the Exercise
Price being subject to adjustment as provided herein).
This Warrant is subject to the following additional terms and
conditions:
1. Method of Exercise
Except as provided in Section 5 hereof, this Warrant may be exercised,
in whole or in part, at any time not later than five years from the date of
issuance hereof (the "Grant Date"), by delivering to the Company (a) the form of
Election to Purchase attached hereto duly completed and executed by the Holder,
(b) this Warrant, and (c) payment of the aggregate Exercise Price for the number
of shares thereby purchased (the "Purchase Price") by bank check payable to the
Company or by wire transfer to an account designated by the Company (each such
date of exercise being an "Exercise Date").
2. Delivery of Stock Certificates
Within ten days after the exercise of this Warrant (in whole or in
part) and the payment of the Purchase Price, the Company at its expense shall
issue in the name of and deliver to the Holder (a) a certificate or certificates
for the number of fully paid and nonassessable shares of Common Stock to which
the Holder shall be entitled upon such exercise and payment, and (b) if this
Warrant has not expired, a new Warrant of like tenor to purchase up to that
number of shares of Common Stock, if any, not previously purchased by the
Holder. The Holder shall for all purposes be deemed to become the holder of
record of such shares of Common Stock on the date on which this Warrant is
surrendered and payment of the Purchase Price is made, irrespective of the date
of delivery of the certificate or certificates representing the Common Stock;
provided that if the date on which such surrender and payment is made is not a
business day, such person shall be deemed to become the holder of record of such
shares of Common Stock on the next succeeding business day.
3. Covenants as to Common Stock
The Company covenants and agrees that the shares of Common Stock
issuable pursuant to the terms of this Warrant will, upon their issuance, be
validly issued and outstanding, fully paid and nonassessable. The Company
further covenants and agrees that it will take all such corporate actions that
may be necessary to provide for the exercise of the rights represented by this
Warrant.
4. Adjustments to Warrant
4.1 Equity Adjustment
If any of the following events shall occur at any time or from time to
time after the Grant Date and prior to the exercise in full or expiration of
this Warrant, the following adjustments to this Warrant shall be made:
(a) Stock Dividends. In case the holders of Common Stock
receive or become entitled to receive, without payment therefor, additional
Common Stock or other securities of the Company directly or indirectly
convertible into or exchangeable for Common Stock by way of dividend, upon the
exercise of this Warrant the Holder shall be entitled to receive, without
additional cost, in addition to the shares of Common Stock to which the Holder
is otherwise entitled upon such exercise (the "Warrant Shares"), the amount of
such other or additional securities of the Company that the Holder would have
held on the Exercise Date, had it been the holder of record of the Warrant
Shares on the Grant Date, and had it thereafter, during the period from the
Grant Date to and including the Exercise Date, retained such Warrant Shares
and/or all other additional securities receivable by it as aforesaid during such
period, giving effect to all adjustments called for during such period by this
Section 4.1.
(b) Stock Splits. In case the Company subdivides its
outstanding shares of Common Stock into a greater number of shares, the Exercise
Price in effect immediately prior to such subdivision shall thereupon be
proportionately reduced and the number of shares receivable upon exercise of the
Warrant shall thereupon be proportionately increased. Conversely, in case the
Company combines the outstanding number of shares of Common Stock into a smaller
number of shares, the Exercise Price in effect immediately prior to such
combination shall thereupon be proportionately increased and the number of
shares receivable upon exercise of the Warrant shall thereupon be
proportionately decreased.
(c) Merger or Consolidation. In case of any merger,
consolidation or reorganization of the Company with or into one or more other
corporations, other than a merger, consolidation or reorganization described in
Section 5 hereof, as a result of which holders of Common Stock receive other
stock, securities or property in lieu of or in addition to, but on account of,
their Common Stock, the Holder, upon the exercise of the Warrant after the
record date for determination of shareholders entitled thereto, shall receive,
in lieu of or in addition to any shares of Common Stock, the proportionate share
of all stock, or other securities (appropriately adjusted for any subsequent
events of the issuer of such stock or securities that are of the kind that would
cause adjustment of the Exercise Price hereunder) or other property issued, paid
or delivered for or on all of the Common Stock, as would have been allowable to
the shares of Common Stock so purchased under this Warrant had this Warrant been
exercised immediately prior to such record date.
4.2 Notice of Adjustment
Whenever events occur requiring this Warrant to be adjusted pursuant to
Section 4.1 above, the Company shall promptly provide Holder with written notice
of such adjustment, setting forth in reasonable detail the acts requiring such
adjustment, and stating such other facts as shall be necessary to show the
manner and figures used to compute such adjustment.
5. Early Termination Upon Certain Transactions
This Warrant shall terminate and be of no further force or effect upon
(a) the consummation of a consolidation, merger or reorganization of the Company
with or into another corporation as a result of which the shareholders of the
Company before the transaction hold less than 50% of the voting equity
securities of the surviving corporation or (b) the sale of all or substantially
all of the assets of the Company; provided, that the Holder shall be given 30
days advance notice of any such transaction.
6. No Shareholder Rights
This Warrant shall not entitle the Holder to any voting rights or any
other rights as a shareholder of the Company or to any other rights whatsoever
except the rights stated herein; and no dividend or interest shall be payable or
shall accrue in respect of this Warrant or the Common Stock issuable upon
exercise of this Warrant, except as provided in Section 4 hereof, until and to
the extent that this Warrant shall be exercised.
7. Reliance on Certain Documents
In the performance of its obligations hereunder, the Company shall be
entitled to rely upon any document or instrument signed before a notary public
and believed by it in good faith to be genuine and signed by the Holder or an
authorized officer or agent thereof, including, but not limited to, any document
or instrument of the Holder purporting to transfer or assign its rights
hereunder to any other person. The Company shall be indemnified and held
harmless by the Holder from and against any and all reasonable expenses,
including reasonable attorneys' fees and disbursements incurred, or losses
suffered, by the Company in connection with its reliance on any such document or
instrument.
8. Restrictions on Transfer
Holder acknowledges that this Warrant and the Common Stock issuable
upon exercise hereof have not been registered under the 1933 Act or the
securities laws of any other jurisdiction and that, accordingly, they may not be
sold, offered for sale, pledged or hypothecated in the absence of (a) a
registration statement in effect with respect to the securities under the 1933
Act (or its equivalent under the laws of any applicable jurisdiction other than
the United States) or (b) under certain circumstances, an opinion of counsel
satisfactory to the Company that such transaction will not be in violation of
applicable securities laws. Holder further acknowledges that a legend setting
forth or referring to the above restrictions shall be placed on this Warrant,
any replacement hereof or any certificate representing the Common Stock issuable
upon exercise hereof, and a stop transfer restriction or order shall be placed
on the books of the Company and with any transfer agent until such securities
may be legally sold or otherwise transferred.
9. Construction
The validity and interpretation of the terms and provisions of this
Warrant shall be governed by the laws of the State of Washington. The
descriptive headings of the several sections of this Warrant are inserted for
convenience only and shall not control or affect the meaning or construction of
any of the provisions thereof.
10. Exchange of Warrant
This Warrant is exchangeable upon the surrender hereof by the Holder at
the office of the Company for new Warrants of like tenor representing in the
aggregate the rights to subscribe for and purchase the number of shares which
may be subscribed for and purchased hereunder, each of such new Warrants to
represent the right to subscribe for and purchase such number of shares as shall
be designated by the Holder at the time of such surrender.
11. Lost Warrant
If this Warrant is lost, stolen, mutilated or destroyed, the Company
shall issue a new Warrant of like denomination, tenor and date as this Warrant,
subject to the Company's right to require the Holder to give the Company a bond
or other satisfactory security sufficient to indemnify the Company against any
claim that may be made against it (including any expense or liability) on
account of the alleged loss, theft, mutilation or destruction of this Warrant or
the issuance of such new Warrant.
12. Binding Effect; No Assignment
This Warrant shall be binding upon and inure to the benefit of the
Company and the Holder and their respective successors and assigns. Except as
expressly provided in this Warrant, neither this Warrant nor the rights or
obligations of any party hereto shall be assignable, other than by operation of
law or with the written consent of the Company or the Holder, as applicable.
Nothing contained in this Warrant, express or implied, is intended to confer
upon any person other than the Company and the Holder and their respective
permitted assigns any rights or remedies of any nature whatsoever by reason of
this Warrant.
13. Waivers and Amendments
This Warrant or any provision hereof may be changed, waived, discharged
or terminated only by a statement in writing signed by the party against which
enforcement of the change, waiver, discharge or termination is sought.
14. Notices
Any notice or other communication required or permitted to be given or
effected hereunder shall be in writing and delivered by personal delivery,
facsimile delivery or reputable express courier service, and shall be deemed
effective upon receipt by the party to be notified at the following respective
addresses, or at such other address as may be designated by written notice.
If to the Company: If to Holder:
Applied Voice Technologies address
11410 N.E. 122nd Way
P.O. Box 97025
Kirkland, WA 98083
Attention: Mr. Richard J. LaPorte
with a copy to: with a copy to:
Perkins Coie Thorpe & Thorpe
1201 Third Avenue, 40th Floor A Professional Corporation
Seattle, WA 98101 601 W. 5th Street, 8th Floor
Attention: Linda A. Schoemaker Los Angeles, CA 90071
Attention: Vincent W. Thorpe
[This space intentionally left blank.]
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IN WITNESS WHEREOF, the Company has executed this Warrant as of the
date first written above.
APPLIED VOICE TECHNOLOGY, INC.
By: /s/ Richard J. LaPorte
<PAGE>
ELECTION TO PURCHASE
To ____________________:
The undersigned hereby irrevocably elects to purchase ___________
shares of Common Stock issuable upon the exercise of the within Warrant, and
requests that certificates for such shares shall be issued in the name of and
delivered to the address of the undersigned, at the address stated below and, if
said number of shares shall not be all the shares which may be purchased
pursuant to the within Warrant, that a new Warrant evidencing the right to
purchase the balance of such shares be registered in the name of, and delivered
to, the undersigned at the address stated below.
(check one)
Payment enclosed in the amount of $_______________.
Payment in the amount of $_______________ has been made by
wire transfer.
Dated: _____________________
Name of holder of Warrant:
(please print)
Address:
Signature:
Business Communications Release
For Immediate Distribution
Editorial Contact: Investor Relations Contact:
Michelle Taylor Michele Reid
Applied Voice Technology, Inc. Applied Voice Technology, Inc.
206 820-6000 ext. 3399 206 820-6000 ext. 3479
[email protected] [email protected]
APPLIED VOICE TECHNOLOGY ANNOUNCES ACQUISITION OF SELECTED ASSETS OF TELCOM
TECHNOLOGIES, INC.
New Generation Automatic Call Distributor (ACD) solidifies AVT's
Suite of Call Center Solutions
KIRKLAND, WA -- December 20, 1996 -- Applied Voice Technology, Inc. (NASDAQ:
AVTC), today announced that it has entered into an agreement to acquire selected
assets of Telcom Technologies, Inc., a developer of NT-based, open-architecture
automatic call distribution (ACD) solutions for the high-growth call center
market.
"The addition of the Telcom Technologies' solutions is consistent with Applied
Voice Technology's overall strategic plan to expand the company through the
acquisition of complementary businesses, products or technologies," said Richard
J. LaPorte, AVT Chairman and Chief Executive Officer. "Telcom Technologies has
fifteen years of experience in the call center market and over 2300
installations. Their latest open architecture, NT-based product offering fits
well into the overall AVT product direction and strategy and solidifies AVT's
role as a technology leader. By incorporating the functions of call distribution
and switching into its line of CTI applications, AVT will be in the unique
position to offer a complete set of business solutions for customers seeking a
common architecture which provides voice and call processing, unified messaging,
and call center productivity applications."
Telcom Technologies currently provides automatic call distribution systems
targeted at the fastest growing segment of the call center market -- the under
75 agent call center. The company has considerable experience in selected
vertical markets such as financial services, catalog fulfillment, and health
care with customers such as Bell South, Ticketmaster and Kaiser Permanente. The
acquisition of the Telcom Technologies' switching and ACD functionality,
underscores AVT's mission of extending the flexibility and power of computer
telephony servers to encompass the seamless integration of call processing,
unified messaging, interactive voice response, call management and switching
using a common architecture and operating system environment.
Details of the acquisition include a purchase price of $3.3 million in cash,
plus warrants to purchase 100,000 shares of AVT common stock exercisable at a
price equal to the average trading price of AVT common stock for a specific
period of time prior to the closing. AVT will take ownership of all of
essentially all of Telcom Technologies' intellectual property, contracts,
customer agreements and other assets. In addition, selected individuals in
Telcom's engineering, manufacturing, sales and customer service will become
full-time AVT employees. Telcom Technologies will discontinue all further
business operations following the closing of the transaction. The acquisition is
expected to be closed in early January, 1997.
Added Roger Fukai, AVT's Chief Financial Officer: "With the exception of a
write-off of purchased research and development and other expenses related to
the acquisition in the first quarter, we excpect the acquisition will not be
dilutive to shareholders in 1997 and will contribute positively to our net
income, earnings per share, and cash flow in 1998."
Regarding distribution, LaPorte added that the acquisition further strengthens
AVT's distribution channel presence. "As AVT continues to formally cultivate a
channel of computer telephony oriented dealers and distributors around the
world, the Telcom Technologies' products will become an integral part of their
total-solution offering. Moreover, we expect to include the current group of
Telcom resellers in our channel, resulting in AVT providing the broadest
possible network of sales and support resources to the call center market."
Telcom Technologies, Inc. established in 1982, is a privately held company
located in Pomona, California. To date, the company has shipped more than 2300
ACD systems throughout North America.
AVT, headquartered in Kirkland, Washington, USA, develops, markets and supports
a broad line of computer telephony software and systems sold worldwide through
affiliated dealers and distributors. AVT has offices in the United Kingdom,
Germany, Canada, Dubai and Hong Kong. In addition, AVT has a wholly owned
subsidiary, RightFAX, Inc., based in Tucson, Arizona. Founded in 1982, AVT is
publicly traded under the symbol "AVTC" on the NASDAQ national market. AVT
maintains a site on the World Wide Web at: www.appliedvoice.com.
