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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 7, 1998
SMARTALK TELESERVICES, INC.
(Exact name of registrant as specified in its charter)
California 0-21579 95-4502740
(State or other jurisdiction (Commission (I.R.S. Employer Identification No.)
of incorporation) File Number) 43016-3566
5080 Tuttle Crossing Boulevard (Zip Code)
Dublin, Ohio
(Address of Principal Executive
Offices)
Registrant's telephone number, including area code: (614) 789-8500
No change
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(Former name or former address, if changed since last report)
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Item 5 -- Other Events.
On Monday, December 7, 1998, SmarTalk TeleServices, Inc. (the "Company")
announced that it reached an agreement with Fletcher International Limited
("Fletcher") for a $25 million secured term loan facility, maturing January 31,
1999. The Company expects to access up to $10 million of the facility over the
next month, subject to the satisfaction of customary conditions to draw down.
The Company can access up to an additional $15 million from the facility over
various periods, subject to the discretion of the lender. The Company plans to
use the financing for general corporate purposes.
An affiliate of Fletcher currently is a shareholder of the Company. In
connection with the financing transaction, the Company has granted Fletcher the
right to acquire, upon satisfaction of applicable notice periods, up to
approximately an additional 15% of the common stock of the Company.
Certain statements made herein that are not historical in nature are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 including the Company's plans and ability to
access various amounts of the credit facility. Investors are cautioned that all
forward-looking statements involve risks and uncertainties that could cause
actual results to differ materially from those expressed in such forward-looking
statements. These risks include the risk that actual amounts accessed under the
facility depend upon the Company's satisfaction of various conditions detailed
in the provisions of the credit agreement including, under certain
circumstances, the lender's discretion. Investors who seek more information
about the Company's business and relevant risk factors may wish to review the
Company's SEC reports, including, without limitation, its Annual Report on Form
10-K for 1997 and its Quarterly Reports on Form 10-Q, as each of such documents
may be amended.
The foregoing is a summary of the transactions described. Reference is made
to the exhibits filed herewith for a complete text of the documents summarized
above which exhibits are incorporated by reference herein in their entirety.
Item 7 -- Financial Statements, Pro Forma Financial Information and Exhibits
(c) The Exhibits furnished in accordance with Item 601 of
Regulation S-K are:
10.1 Credit Agreement, dated as of December 4, 1998, between the
Company and Fletcher, as lender.
10.2 Pledge and Security Agreement, dated as of December 4, 1998,
among the Company, its subsidiaries listed therein, and
Fletcher.
10.3 Promissory Note, dated as of December 4, 1998, made by the
Company in favor of Fletcher.
10.4 Investment Rights Agreement, dated as of December 4, 1998,
between the Company and Fletcher.
99.1 Press Release of the Company, dated December 7, 1998.
SIGNATURE
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.
Date: December 8, 1998
SMARTALK TELESERVICES, INC.
(Registrant)
/s/ Thaddeus Bereday
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Thaddeus Bereday
Thaddeus Bereday
Vice President and General Counsel
Exhibit Index
(c) The Exhibits furnished in accordance with Item 601 of
Regulation S-K are:
10.1 Credit Agreement, dated as of December 4, 1998, between
SmarTalk Teleservices, Inc. (the "Company") and
Fletcher International Limited ("Fletcher"), as lender.
10.2 Pledge and Security Agreement, dated as of December 4,
1998, among the Company, its subsidiaries listed
therein, and Fletcher.
10.3 Promissory Note, dated as of December 4, 1998, made by
the Company in favor of Fletcher.
10.4 Investment Rights Agreement, dated as of December 4,
1998, between the Company and Fletcher.
99.1 Press Release of the Company, dated December 7, 1998.