TABLE OF CONTENTS
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 02549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 20, 1999
PHONETEL TECHNOLOGIES, INC.
(Exact Name of Registrant as Specified in its Charter)
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| Ohio |
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0-16715 |
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34-146219 |
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| (State or Other Jurisdiction
of Incorporation) |
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(Commission
File Number)
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(IRS Employer
Identification Number) |
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| North Point Tower, 7th Floor, 1001 Lakeside Avenue, Cleveland, Ohio |
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44114-1195 |
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(Zip Code) |
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| Registrant's Telephone Number, including area code |
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(216) 241-2555 |
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Item 3. Bankruptcy or Receivership
The following information is being furnished with respect to the order
confirming the Joint Reorganization Plan (the “Plan”) of PhoneTel Technologies,
Inc. (“Registrant”) and Cherokee Communications, Inc., (“Cherokee”) its wholly
owned subsidiary (Registrant and Cherokee are hereinafter referred to as the
“Debtors”).
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(1) The order confirming the Plan was entered by the United States
Bankruptcy Court for the Southern District of New York (the “Court”). |
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(2) The order confirming the Plan was signed by the Court on October
20, 1999 and entered on the Court’s docket on October 22, 1999. |
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(3) Pursuant to the terms of the Plan, claims of employees, trade and
the other creditors of the Debtors, other than holders of the
Registrant’s $125 million 12% Senior Notes due 2006 (the “Senior
Notes”) are to be paid in full in the ordinary course, unless
otherwise agreed, with the Registrant retaining its rights and
defenses with respect to such claims. Holders of the Senior Notes
will receive 9.5 million shares of a new issue of common stock, $0.01
par value per share, of the reorganized company (“New Common Stock”)
in exchange for the Senior Notes. In addition, an Unofficial
Committee of Noteholders representing approximately 59.3% in principal
amount of the Senior Notes will appoint four of the five members of
the Board of Directors of the Registrant (the “New Board”). Peter G.
Graf, will continue to serve as a Director on the New Board for a
period of one year following the consummation of the Plan. |
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Holders of the Registrant’s 14% Cumulative Redeemable Preferred Stock
(14% Preferred) will receive 325,000 shares of New Common Stock and
warrants to purchase up to 722,200 shares of New Common Stock at an
exercise price of $10.50 per share which expire three years from the
date of issue (“New Warrants”). Holders of existing common stock of
the Registrant (“Old Common Stock”) will receive 175,000 shares of New
Common Stock and New Warrants to purchase up to 388,900 shares of New
Common Stock. Options and warrants to purchase Old Common Stock will
be extinguished pursuant to the Plan. |
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The equity interests issued in connection with the Plan are subject to
dilution by certain other equity issuances, including issuances to
certain financial advisors of the Registrant for services rendered in
connection with the reorganization, and issuances resulting from the
exercise of certain options to purchase up to 5% of New Common Stock to
be issued by the New Board pursuant to a management incentive plan
(“Management Incentive Plan”) included as part of the Plan. A copy of
the Plan as confirmed is included herein as Exhibit 2.1. |
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(4) The number of shares of 14% Preferred and Old Common Stock
outstanding are 107,918 and 18,754,133, respectively. Upon
consummation of the Plan, the following numbers of shares of New
Common Stock will be issued and outstanding: 9,500,000 shares in
exchange for the Senior Notes, 325,000 shares to the holders of the
14% Preferred, 175,000 shares to the holders of Old Common Stock and
205,000 shares as financial advisory fees, for a total amount of New
Common Stock outstanding of 10,205,000. In addition, 1,111,100 shares
of New Common Stock are reserved for future issuance upon the exercise
of the New Warrants, and an amount equal to 5% of the shares of New
Common Stock is reserved for issuance pursuant to the Management
Incentive Plan. Under its Amended and Restated Articles of
Incorporation confirmed as part of the Plan, the total authorized
capital stock of the Registrant is 15,000,000 shares of New Common
Stock. |
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(5) Information as to the assets and liabilities of the Registrant as
of September 30, 1999, the closest practicable date to the date the
order confirming the Plan was entered, is set forth in the
Registrant’s consolidated balance sheet included herein as Exhibit
99.1. |
Item 7. Financial Statements and Exhibits
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(a) Not applicable |
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(b) Not applicable |
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(c) Exhibits |
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2.1 |
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Joint Reorganization Plan of PhoneTel Technologies, Inc. and
Cherokee Communications, Inc. |
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2.2 |
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Findings of Fact, Conclusions of Law and Order Confirming the Joint
Reorganization Plan of PhoneTel Technologies, Inc., and Cherokee Communications, Inc. Dated May 11, 1999. |
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99.1 |
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Consolidated balance sheet of Registrant as of September 30, 1999 |
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.
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PHONETEL TECHNOLOGIES, INC |
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| Date: November 4, 1999 |
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By: /s/ Richard P. Kebert |
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Richard P. Kebert
Chief Financial Officer |
