SECURITIES AND EXCHANGE COMMISSION
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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): June 5, 1998 (June 4,1998)
TELCO SYSTEMS, INC.
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(Exact name of registrant as specified in its charter)
Delaware 0-12622 94-2178777
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
63 Nahatan Street, Norwood, Massachusetts 02062
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(Address of principal executive offices) (Zip Code)
(781) 551-0300
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(Registrant's telephone number, including area code)
TELCO SYSTEMS, INC.
Current Report on Form 8-K
Item 5. Other Events.
On June 4, 1998, Telco Systems, Inc. (the "Company"), World
Access, Inc. ("World Access"), WAXS Inc., a wholly owned subsidiary of
World Access ("WAXS"), and Tail Acquisition Corporation, a wholly owned
subsidiary of WAXS ("Merger Sub"), announced that they had entered into a
definitive Agreement and Plan of Merger and Reorganization providing for,
among other things, the merger of the Company and Merger Sub, with the
Company surviving and becoming a wholly owned subsidiary of WAXS (the
"Merger"). The Merger has been approved by the Boards of Directors of the
Company, WAXS and World Access.
Pursuant to the Merger Agreement, each outstanding share of
common stock, par value $.01 per share, of the Company ("Company Common
Stock") will be converted into the right to receive that number of shares
of (i) common stock, par value $.01 per share, of World Access ("World
Access Common Stock"), or (ii) if World Access' previously announced
holding company reorganization shall have been consummated on or before the
time of the Merger, New World Access common stock, $.01 par value per share
(in either case, the "Merger Common Stock"), equal to the quotient of
$17.00 divided by the average daily closing price of the Merger Common
Stock as reported on the Nasdaq on each of the twenty consecutive trading
days ending on the second business day prior to the date of the Merger (the
"Average Closing Price"), provided that if the Average Closing Price is
more than $36.00 per share, then each share of Company Common Stock will be
converted into .4722 shares of Merger Common Stock and if the Average
Closing Price is less than $29.00 per share, then each share of Company
Common Stock will be converted into .5862 shares of Merger Common Stock.
The transaction is expected to be completed in the third quarter
of calendar 1998. It is subject to customary conditions, including
clearance under the Hart-Scott-Rodino Antitrust Improvements Act and
approval by the respective stockholders of the Company and World Access.
The parties intend for the Merger to constitute a tax-free reorganization
and to be accounted for as a purchase.
In connection with the Merger Agreement, Kopp Investment
Advisors, Inc. and the directors and certain executive officers of the
Company have entered into a Stockholders Proxy Agreement with WAXS pursuant
to which, among other things, they have agreed to vote an aggregate of
approximately 8.0% of the Company's outstanding shares in favor of the
Merger.
Copies of the Merger Agreement, the Stockholders Proxy Agreement
and the press release issued by the Company and World Access announcing the
transaction have been filed as exhibits hereto and are incorporated herein
by reference.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
Exhibit No. Description
2.01 Agreement and Plan of Merger and Reorganization, dated as
of June 4, 1998, among World Access, Inc., WAXS Inc., Tail
Acquisition Corporation and the Company.
99.01 Stockholders Proxy Agreement, dated as of June 4, 1998,
among WAXS Inc., Kopp Investment Advisors, Inc. and certain
directors and officers of the Company.
99.02 Press Release of the Company and World Access Inc. dated
June 4, 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's duly authorized signatory.
Dated: June 5, 1998
TELCO SYSTEMS, INC.
By: /s/
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Name: William J. Stuart
Title: Vice President and
Chief Financial Officer
EXHIBIT INDEX
Exhibit No. Description
2.01 Agreement and Plan of Merger and Reorganization, dated as
of June 4, 1998, among World Access, Inc., WAXS Inc., Tail
Acquisition Corporation and the Company.
99.01 Stockholders Proxy Agreement, dated as of June 4, 1998,
among WAXS Inc., Kopp Investment Advisors, Inc. and certain
directors and officers of the Company.
99.02 Press Release of the Company and World Access, Inc. dated
June 4, 1998.