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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
Date of Report (Date of earliest event reported): June 30, 1999
WORLD ACCESS, INC.
(Exact Name of Registrant as Specified in Charter)
DELAWARE 0-29782 58-2398004
(State of (Commission File No.) (I.R.S. Employer
Incorporation) Identification No.)
945 E. PACES FERRY ROAD, SUITE 2200
ATLANTA, GEORGIA 30326
(Address of principal executive offices, including zip code)
(404) 231-2025
(Registrant's telephone number, including area code)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
Effective June 30, 1999, WA Telcom Products Co., Inc., a wholly-owned
subsidiary of World Access, Inc. ("WAXS"), acquired substantially all of the
assets and assumed certain liabilities of Comm/Net Holding Corporation and its
wholly-owned subsidiaries, Enhanced Communications Corporation, Comm/Net
Services Corporation and Long Distance Exchange Corporation (Comm/Net Holding
Corporation and each of its wholly-owned subsidiaries are referred to herein
collectively as "Comm/Net"). Comm/Net, headquartered in Plano, Texas, is a
facilities-based provider of wholesale international long distance and
wholesale prepaid calling card services, primarily to the Texas and Mexico
telecommunications markets. Comm/Net had revenues of approximately $38 million
during the year ended December 31, 1998.
Pursuant to the terms of an Agreement and Plan of Reorganization,
dated May 27, 1999, WAXS paid a total consideration of approximately $27
million, primarily in the form of newly issued shares of 4.25% Cumulative
Junior Convertible Preferred Stock, Series B (the "Preferred Stock"). The
consideration was determined through arms-length negotiations between the
parties and estimated values of the assets and liabilities of Comm/Net and is
subject to adjustment based on the receipt by WAXS of Comm/Net's 1998 audited
financial statements, which shall be satisfactory to WAXS in its reasonable
judgment. The Preferred Stock pays dividends on a quarterly basis and is
convertible into shares of WAXS common stock at a conversion rate of $16.00 per
common share, subject to standard antidilution adjustments. If the closing
trading price of WAXS common stock exceeds $16.00 per share for 45 consecutive
trading days, the Preferred Stock will automatically convert into WAXS common
stock. The closing price of WAXS common stock on June 30, 1999 was $14.125 per
share. Each holder of Preferred Stock has the right to vote, on an as-converted
basis, on all matters voted on by the holders of WAXS common stock, voting
together as a single class with the holders of WAXS common stock and other
holders of preferred stock of WAXS. The acquisition is intended to qualify as a
tax-free reorganization under Section 368(a)(1)(C) of the Internal Revenue Code
of 1986, as amended. The foregoing description of the transaction is qualified
in its entirety by reference to the press release attached hereto as Exhibit
No. 99 and incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements.
In accordance with Item 7(a)(4) of Form 8-K, the historical
financial statements of Comm/Net required to be filed with the Commission will
be filed as an amendment to this report under cover of Form 8-K/A on or before
September 13, 1999.
(b) Pro Forma Financial Information.
In accordance with Item 7(b)(2) of Form 8-K, any pro forma
financial information required to be filed with the Commission will be filed as
an amendment to this report under cover of Form 8-K/A on or before September
13, 1999.
(c) Exhibits.
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EXHIBIT
NUMBER DESCRIPTION
2 Agreement and Plan of Reorganization, dated May 27, 1999, by and among
WA Telcom Products Co., Inc., World Access, Inc., Comm/Net Holding
Corporation, Enhanced Communications Corporation, Comm/Net Services
Corporation, Long Distance Exchange Corporation, Gregory A. Somers,
Kelli J. Somers, R. Scott Birdwell, Teleplus Telecommunications, Inc.,
Jeff Becker, Michael Billingsly, Chris Johns and Denny D. Somers. The
following is a list of omitted schedules, exhibits and other
attachments which World Access, Inc. agrees to furnish supplementally
to the Commission upon request:
SCHEDULES TO AGREEMENT
1.1(a) Assets
1.1(b) Excluded Assets
1.4 Assumed Liabilities
3.1(a) Qualification; Good Standing
3.1(b) Subsidiaries
3.1(d) Officers and Directors
3.2 Authorized and Outstanding Stock
3.4 Financial Statements
3.5 Undisclosed Liabilities
3.7(a) Real and Personal Property
3.7(b)(1) Permitted Liens
3.7(b)(2) Off-Premise Property
3.7(c) Other Property Restrictions
3.8 Leases
3.9 Indebtedness
3.10(a) Patents, Trademarks, etc.
3.10(b) Software and Databases
3.11 Litigation
3.12 Salaried Employees
3.13 Employee Benefit Plans
3.14 Collective Bargaining
3.16 Bank Accounts
3.17 Investments
3.18 Tax Matters
3.20 Licenses and Permits
3.21 Insurance Policies
3.22 Major Suppliers and Customers
3.23 Contracts and Commitments
3.24 No Conflict
3.25 Agreements in Full Force and Effect
3.26 Required Consents and Approvals
3.27 Certain Changes and Events
3.28 Accounts Receivable
4.3 No Conflict
4.5 Capitalization
11.11(a) Brokerage
11.11(b) Brokerage
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EXHIBITS TO AGREEMENT
C Non-Competition Agreements
OTHER ATTACHMENTS
Letter dated June 30, 1999 regarding post-closing purchase
price adjustments
4.1 Certificate of Designation of 4.25% Cumulative Junior
Convertible Preferred Stock, Series B.
4.2 Registration Rights Agreement, dated June 30, 1999, by and
among Comm/Net Holding Corporation, Gregory A Somers, Kelli
J. Somers, R. Scott Birdwell, Teleplus Telecommunications,
Inc., Chris Johns, Jeff Becker, Michael Billingsly and World
Access, Inc.
99 Press Release dated July 1, 1999 announcing the acquisition
of substantially all of the assets of the Comm/Net group of
companies.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on behalf of the
undersigned hereunto duly authorized.
WORLD ACCESS, INC.
Date: July 14, 1999 By: /s/ MARTIN D. KIDDER
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Martin D. Kidder
Vice President and Controller
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EXHIBIT INDEX
Exhibit No. Document
2 Agreement and Plan of Reorganization, dated May 27, 1999, by
and among WA Telcom Products Co., Inc., World Access, Inc.,
Comm/Net Holding Corporation, Enhanced Communications
Corporation, Comm/Net Services Corporation, Long Distance
Exchange Corporation, Gregory A. Somers, Kelli J. Somers, R.
Scott Birdwell, Teleplus Telecommunications, Inc., Jeff
Becker, Michael Billingsly, Chris Johns and Denny D. Somers.
The following is a list of omitted schedules, exhibits and
other attachments which World Access, Inc. agrees to furnish
supplementally to the Commission upon request:
SCHEDULES TO AGREEMENT
1.1(a) Assets
1.1(b) Excluded Assets
1.4 Assumed Liabilities
3.1(a) Qualification; Good Standing
3.1(b) Subsidiaries
3.1(d) Officers and Directors
3.2 Authorized and Outstanding Stock
3.4 Financial Statements
3.5 Undisclosed Liabilities
3.7(a) Real and Personal Property
3.7(b)(1) Permitted Liens
3.7(b)(2) Off-Premise Property
3.7(c) Other Property Restrictions
3.8 Leases
3.9 Indebtedness
3.10(a) Patents, Trademarks, etc.
3.10(b) Software and Databases
3.11 Litigation
3.12 Salaried Employees
3.13 Employee Benefit Plans
3.14 Collective Bargaining
3.16 Bank Accounts
3.17 Investments
3.18 Tax Matters
3.20 Licenses and Permits
3.21 Insurance Policies
3.22 Major Suppliers and Customers
3.23 Contracts and Commitments
3.24 No Conflict
3.25 Agreements in Full Force and Effect
3.26 Required Consents and Approvals
3.27 Certain Changes and Events
3.28 Accounts Receivable
4.3 No Conflict
4.5 Capitalization
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11.11(a) Brokerage
11.11(b) Brokerage
EXHIBITS TO AGREEMENT
C Non-Competition Agreements
OTHER ATTACHMENTS
Letter dated June 30, 1999 regarding post-closing purchase
price adjustments
4.1 Certificate of Designation of 4.25% Cumulative Junior
Convertible Preferred Stock, Series B.
4.2 Registration Rights Agreement, dated June 30, 1999, by and
among Comm/Net Holding Corporation, Gregory A. Somers, Kelli
J. Somers, R. Scott Birdwell, Teleplus Telecommunications,
Inc., Chris Johns, Jeff Becker, Michael Billingsly and World
Access, Inc.
99 Press Release dated July 1, 1999 announcing the acquisition
of substantially all of the assets of the Comm/Net group of
companies.
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