SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report November 6, 1998
(Date of earliest event reported) (November 2, 1998)
CTC COMMUNICATIONS CORP.
(Exact name of registrant as specified in its charter)
Massachusetts 0-13627 04-2731202
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
360 Second Ave., Waltham, Massachusetts 02154
(Address of principal executive offices) (Zip Code)
(781) 466-8080
(Registrant's telephone number including area code)
(Former name or former address if changed since last report)
Item 5. Other Events
On November 2, 1998, the Registrant issued the following press release:
"For Further Information Contact:
John D. Pittenger,
Executive Vice President -
Finance and Administration
CTC Communications Corp.
(781) 466-1302
Internet: http//www.ctcnet.com
November 2, 1998
FOR IMMEDIATE RELEASE
CTC ANNOUNCES COMPLETION OF ITS $25 MILLION VENDOR
FINANCING FACILITY WITH CISCO CAPITAL CORP.
WALTHAM, Mass.--(BUSINESS WIRE)--Nov. 2, 1998--CTC Communications Corp.
(NASDAQ:CPTL) announced today that it has closed its previously announced
three year vendor financing facility for up to $25 million with Cisco Capital
Corp. Under the terms of the agreement, CTC has agreed to a three year, $25
million volume purchase commitment of Cisco Systems equipment and services
and Cisco Capital Corp has agreed to advance funds as these purchases occur.
In addition, a portion of the Cisco facility can be utilized for working
capital costs associated with the integration and operation of Cisco Systems
solutions and related peripherals.
CTC expects to utilize the proceeds of this financing to deploy the first
phase of its data-centric Integrated Communications Network in 22 network hub
and node sites within the New York and New England regions. In this first
phase CTC will deploy an advanced Asynchronous Transfer Mode (ATM)-based
network, using Cisco BPX(R) 8600 series and Cisco MGX(tm) 8800 series IP+ATM
wide-area switches.
Bob Fabbricatore, Chairman and CEO of CTC, said, "We are extremely pleased to
receive this endorsement of our strategy from Cisco Capital Corp. This brings
the total amount of financing raised by CTC this year to $112 million. We
plan to begin deploying our network in December and expect that it will be
operational by April of next year. Once operational, CTC will test the
network with its branch offices and selected long-standing customers. By the
summer of 1999, CTC expects to make its network available to the broader
marketplace."
CTC is a rapidly growing provider of integrated communications solutions to
small and medium-sized business customers in the Northeastern U.S. It
provides an extensive array of voice and data services including local, long
distance, frame relay, Internet access, and other advanced data services. The
Company markets its services through its 190 member direct sales force
located in 20 branch offices throughout Massachusetts, New York, Connecticut,
New Hampshire, Vermont, Rhode Island, and Maine. CTC's headquarters is in
Waltham, Massachusetts and CTC can be found on the worldwide web at
http://.ctcnet.com. Investors seeking information on CTC's transition to
facilities-based CLEC strategy are encouraged to review the fiscal first
quarter conference call notes from our August 10, 1998 investor conference
call on our website.
The statements in this press release that relate to future plans, events or
performance are forward-looking statements including statements relating to
capital requirements, operations, and the timing of both the network
deployment and the transition of CTC customers to the network. These
statements involve risk and uncertainties that could cause actual results to
differ materially from those reflected or implied in the forward-looking
statements. Readers are, accordingly, cautioned not to place undue reliance
on these forward-looking statements, which speak only as to the date hereof.
Additional information about these risks and uncertainties is set forth in
the Company's most recent report on Form 10-Q. CTC undertakes no obligation
to release publicly the results of any revisions to these forward-looking
statements that may be made to reflect results, events or circumstances after
the date hereof."
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Pursuant to the terms of the Credit Agreement dated as of October 14, 1998,
the Registrant has agreed to give the Lender a senior security interest in
all Cisco products purchased with the proceeds of the first $15 million
advanced under the Credit Facility and a subordinate security interest in all
products purchased with the remaining $10 million advanced under the Credit
Facility. Under the terms of the Credit Facility, the Registrant is required
to pay interest on funds advanced under the facility at an annual rate of
12.5%. In addition, the Registrant is required to pay a commitment fee of
.50% per annum, a facility fee of $15,000 per month. The Registrant paid a
closing fee of 1% of the total credit facility.
Reference is made to the Credit Agreement filed as an Exhibit hereto for all
of the terms and conditions of the Cisco Credit Facility.
Item 7c. Exhibits.
Exhibit 10.1 Credit Agreement with Cisco Systems Capital
Corp. dated as of October 14, 1998
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.
CTC COMMUNICATIONS CORP.
(Registrant)
By: /s/ Steven Jones
Steven Jones,
Chief Financial Officer
November 6, 1998