UNITED STATES
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): December 15, 1997
PEOPLES TELEPHONE COMPANY, INC.
(Exact name of registrant as specified in its charter)
New York 1-12443 13-2626435
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation or organization) Identification No.)
2300 N.W. 89th Place, Miami, Florida 33172
(Address of principal executive offices) (Zip Code)
(305) 593-9667
(Registrant's telephone number, including area code)
Not applicable
(Former name, former address, and former fiscal year,
if changed since last report)
Item 2. Acquisition or Disposition of Assets.
On December 19, 1997, Peoples Telephone Company, Inc. (the "Company")
entered into an Asset Purchase Agreement ("Agreement") with Talton Holdings,
Inc. ("Talton"), pursuant to which the Company agreed to sell, and Talton agreed
to purchase, the operating assets of the Company's inmate phone division (the
"Inmate Division") for an initial purchase price of $10,625,000 (the "Initial
Purchase Price") plus additional contingent consideration described below. A
copy of the Agreement is being filed as Exhibit 2 to this Current Report on Form
8-K. The transaction was also consummated on December 19, 1997.
The Initial Purchase Price was paid in cash at closing. The contingent
consideration price is payable within 18 months after the closing based upon a
formula which generally provides for the sharing of (a) incremental profits from
revenue increases on certain contracts sold to Talton pursuant to the Agreement
and (b) profits resulting from Talton's closing on pending bids initiated by the
Company which result in new contracts. The purchase price was determined
pursuant to arms-length negotiations between the Company and Talton.
The Company expects to report a gain on the disposition in its 1997 fourth
quarter results. The proceeds from the transaction will be applied to the
purchase of pay telephone assets from Indiana Telcom Corporation, Inc. ("Indiana
Telcom"), described in Item 5 below.
Item 5. Other Events.
On December 15, 1997, the Company announced that it had reached a
definitive agreement to acquire the pay telephone assets of Indiana Telcom for a
cash purchase price of approximately $11,200,000, subject to adjustment for the
actual number of phones acquired. Indiana Telcom, based in Indianapolis,
Indiana, operates approximately 2,600 public pay telephones, located primarily
in Indiana and adjacent Midwestern states. The transaction is anticipated to be
completed in January of 1998.
Statements in this Form 8-K relating to matters that are not historical
facts are forward-looking statements. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors, which may cause the
actual results, performance or achievements of Peoples Telephone Company, Inc.
to be materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such known and unknown
risks, uncertainties and other factors include, but are not limited to, the
following: (i) the impact of competition especially in a deregulated environment
(including the ability of the Company to implement higher market-based rates for
local coin calls); (ii) uncertainties with respect to the implementation and
effect of the Telecommunications Act of 1996 including any new rule making by
the Federal Communications Commission ("FCC") or litigation which may seek to
modify or overturn the FCC's orders implementing such act or portions thereof;
(iii) the ongoing ability of the Company to deploy its public pay phones in
favorable locations, (iv) the Company's ability to continue to implement
operational improvements, and (v) the ability of the Company to efficiently
integrate acquisitions of other telecommunications companies. Such factors and
others are set forth in greater detail in the Company's Annual Report on Form
10-K, Quarterly Reports on Form 10-Q and other Current Reports on Form 8-K filed
with the Securities and Exchange Commission.
Item 7. Financial Statements and Exhibits
(a) Financial statements of business acquired.
Not required
(b) Pro forma financial information.
The required pro forma financial information (unaudited) with respect
to sale set forth in Item 2 above is attached hereto as Exhibit 99 and
is incorporated herein by reference.
(c) Exhibits.
2. Asset Purchase Agreement dated December 19, 1997 by and between
Peoples Telephone Company, Inc. and Talton Holdings, Inc. The
Company hereby agrees to furnish supplementally any omitted
schedules described in such agreement to the Securities and
Exchange Commission upon request.
99. Pro forma financial statements reflecting divestment of the
Inmate Division.
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, as of December 30, 1997.
PEOPLES TELEPHONE COMPANY, INC.
Date: December 30, 1997 By: /s/ William A. Baum
William A. Baum
Chief Financial Officer