Form SC 13D for DCI TELECOMMUNICATIONS INC filed on Mar 8 1999 9:15AM
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Wavetech International, Inc.
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(Name of Issuer)
COMMON STOCK
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(Title of Class of Securities)
944019-20-7
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(CUSIP Number)
DCI Telecommunications, Inc.
611 Access Road
Stratford, CT 06615
Attn: Larry Shatsoff
Phone: 203-380-0910
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
February 26, 1999
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this
Schedule 13D, and is filing this schedule because of Rule 13d-
1(b)(3) or (4), check the following box [ ].
NOTE: Schedules filed in paper format shall include a signed
original and five copies of the schedule, including all exhibits.
See Rule 13d-1(a) for other parties to whom copies are to be
sent.
* The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to
the subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided in
a prior cover page.
The information required on the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section 18
of the Securities Exchange Act of 1934 ("Act") or otherwise
subject to the liabilities of that section of the Act but shall
be subject to all other provisions of the Act (however, see the
Notes).
SCHEDULE 13D
CUSIP NO. 944019-20-7 PAGE 2 OF 5 PAGES
1 NAME OF REPORTING PERSON: DCI Telecommunications, Inc.
I.R.S. IDENTIFICATION NO: 84-1155041
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [] (b)[]
3 SEC USE ONLY:
4 SOURCE OF FUNDS: OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e): [ ]
6 CITZENSHIP OR PLACE OF ORGANIZATION: Incorporated in Colorado
NUMBER OF 7 Sole Voting Power:
SHARES 568,846 shares of Common Stock
BENEFICIALLY
OWNED BY 8 Shared Voting Power:
EACH -0-
REPORTING PERSON
WITH 9 Sole Dispositive Power
568,846 shares of Common Stock
10 Shared Dispositive Power
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
568,846 shares of Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 16.6%
14 TYPE OF REPORTING PERSON: CO
SCHEDULE 13D
CUSIP NO. 944019-20-7 PAGE 3 OF 5 PAGES
THIS SCHEDULE 13D IS FILED ON BEHALF OF DCI TELECOMMUNICATIONS,
INC. (the "Reporting Company").
ITEM 1. SECURITY AND ISSUER
This Schedule 13D related to shares of common stock, par value
$.001 per share (the "Common Stock") of Wavetech International,
Inc. (the "Issuer").
The principal executive office and mailing address of the Issuer
are 5210 East Williams Circle, Suite 200, Tucson, Arizona 85711,
phone: (520) 750-9093.
ITEM 2. IDENTITY AND BACKGROUND
Name: DCI Telecommunications, Inc.
State of Incorporation: Colorado
Business address: 611 Access Road
Stratford, CT 06615
Principal Business: Telecommunication products and services
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The securities were acquired through an exchange of shares in
which the Issuer exchanged 568,846 shares of its common stock,
equating to approximately 16.6% of its outstanding shares (after
giving effect to the issuance of such shares) for 576,047 shares
of common stock of the Reporting Company representing
approximately 2% of its currently outstanding shares (after
giving effect to the issuance of such shares).
SCHEDULE 13D
CUSIP NO. 944019-20-7 PAGE 4 OF 5 PAGES
ITEM 4. PURPOSE OF TRANSACTION
The Reporting Company acquired the shares of common stock of the
Issuer for purposes of certain business synergies. The Issuer and
the Reporting Company have also entered into a merger agreement
(reference Form 8-K dated November 16, 1998 as filed by the
Reporting Company). However, this transaction was negotiated
separately from the merger and neither transaction is dependent
upon the other.
In connection with the stock exchange, the Issuer and Reporting
Company have agreed to add one member to their respective Board
of Directors from each other's company.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
According to information furnished to the Reporting Company by
the Issuer, there were 2,858,523 shares of common stock issued
and outstanding as of January 22, 1999. Based on such
information, the Reporting Company directly owns and has sole
power to vote 568,846 shares of Issuer which represents 16.6% of
the currently outstanding common stock of the Issuer, after
giving effect to the issuance of the shares to the Reporting
Company in this transaction.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER
The Reporting Company has agreed to vote its shares for and
against any proposals submitted to the Issuer's shareholders in
the same proportions as are cast by the Issuer's other
outstanding shares.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
1.1 Agreement, dated February 26, 1999 among Wavetech
International, Inc. and DCI Telecommunications, Inc.
1.2 Wavetech International, Inc. and DCI Telecommunications,
Inc. Merger Agreement (filed by reference)
SCHEDULE 13D
CUSIP NO. 944019-20-7 PAGE 4 OF 5 PAGES
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this
statement is true, complete and correct.
Date: March 8, 1999 Signature: Joseph J. Murphy
Name: Joseph J. Murphy
ATTENTION: INTENTIONAL MISSTATEMENTS OR OMISSIONS OF FACT
CONSTITUTE FEDERAL CRIMINAL VIOLATIONS (SEE 18 U.S.C. 1001)
Exhibit Index
1.1 Agreement, dated February 26, 1999 among Wavetech
International, Inc. and DCI Telecommunications, Inc.
1.2 Wavetech International, Inc. and DCI Telecommunications,
Inc. Merger Agreement (reference Form 8K, dated November
16, 1998 filed by DCI
Telecommunications, Inc.)
AGREEMENT
This AGREEMENT (the "Agreement") is entered into as of this
26th day of February, 1999 by and between Wavetech International,
Inc., a Nevada corporation ("Wavetech") and DCI
Telecommunications, Inc., a Colorado corporation ("DCIC").
RECITALS
WHEREAS, DCIC and Wavetech have agreed to exchange 568,846
shares of the common stock, $.001 par value per share of Wavetech
(the "Wavetech Common Stock") for 576,047 shares of DCIC's common
stock, $.01 par value per share (the "DCIC Common Stock");
WHEREAS, in connection with such exchange, each of the
parties have agreed to nominate one person designated by the
other party to serve on their respective Boards of Directors; and
WHEREAS, as a further condition to making the exchange of
the DCIC Common Stock and the Wavetech Common Stock, each of the
parties to this Agreement has agreed to place certain
restrictions upon their ability to cast votes with respect to the
shares to be acquired and take certain other actions related to
the common stock of the other party.
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS
I.1 Adverse Action. An "Adverse Action" shall mean any
adverse investigation, order or other proceeding or action by the
Securities and Exchange Commission, the National Association of
Securities Dealers, Inc. or any other governmental agency, self-
regulatory agency, stock exchange or quotation system having
jurisdiction over DCIC or Wavetech, as the case may be, the
subject of which is DCIC, Wavetech or any of their respective
Affiliates.
I.2 Affiliate. An "Affiliate" of a Person shall have the
meaning set forth in Rule 12b-2 of the Exchange Act as in effect
on the date hereof and, in addition, shall include "Associates"
(as defined in Rule 12b-2 of the Exchange Act as in effect on the
date hereof) of such Person and its Affiliates.
I.3 Beneficial Owner. A Person shall be deemed to
"beneficially own, " or to have "beneficial ownership" of, any
Voting Securities in accordance with the term "beneficial
ownership" as defined in Rule 13d-3 under the Exchange Act as in
effect on the date hereof and, in addition, such terms shall
include securities which such Person has the right to acquire
(irrespective of whether such right is exercisable immediately or
only after the passage of time, including the passage of time in
excess of 60 days) pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion rights, exchange
rights, warrants, options or otherwise.
I.4 Effective Date. The Agreement shall become effective
as of the date hereof (the "Effective Date").
I.5 Exchange Act. "Exchange Act" shall mean the Securities
Exchange Act of 1934, as amended.
I.6 Fair Market Value "Fair Market Value" shall mean the
closing sales price of the DCIC Common Stock or the Wavetech
Common Stock, as the case may be, on February __, 1999. The Fair
Market Value of the Wavetech Common Stock is $2.50 per share.
The Fair Market Value of the DCIC Common Stock is $2.468 per
share.
I.7 Person. "Person" shall mean any individual, group,
corporation, partnership, firm, government or agency or political
subdivision thereof, or other entity of whatever nature.
I.8 Securities Act "Securities Act" shall mean the
Securities Act of 1933, as amended.
1.9. Standstill Termination Date. The "Standstill
Termination Date" shall be the later of (i) the first anniversary
date of this Agreement or (ii) the date on which there is a final
resolution of that certain investigation by the Securities and
Exchange Commission of DCIC which is currently pending; provided,
however, that if such investigation results in a resolution
materially adverse to DCIC's business or financial condition or
in a finding that DCIC or any of its Affiliates has engaged in
intentional or willful misconduct or fraud, the Standstill
Termination Date shall be such date as the shares of Wavetech
Common Stock acquired by DCIC pursuant to this Agreement have
been disposed of in accordance with Article IV hereof. For
purposes of this definition, "resolution" shall mean any
settlement, injunction, order or other final, non-appealable
decision in such matter.
I.10 Standstill Period. The period from the Effective Date
through the Standstill Termination Date is referred to herein as
the "Standstill Period. "
I.11 Voting Securities. "Voting Securities" shall mean the
shares of Common Stock and any other securities of DCIC and
Wavetech, as the context implies, entitled to vote generally in
the election of directors or any other securities (including,
without limitation, rights and options) convertible into,
exchangeable for or exercisable for, any of the foregoing
(whether or not presently convertible, exchangeable or
exercisable).
ARTICLE II
PURCHASE AGREEMENTS
II.1 Exchange of Shares. Effective as of the Effective Date,
DCIC hereby agrees to purchase and Wavetech hereby agrees to sell
to DCIC, 568,846 shares of restricted Wavetech Common Stock. In
exchange for the shares of Wavetech Common Stock to be acquired,
DCIC hereby agrees to issue to Wavetech, 576,047 shares of DCIC
Common Stock. DCIC and Wavetech each acknowledge and agree that
the shares of DCIC Common Stock and Wavetech Common Stock to be
exchange in accordance with this paragraph have an equivalent
Fair Market Value.
II.2 Representations and Warranties of Wavetech. Wavetech
does hereby represent, warrant and agree with DCIC as of the
Effective Date, the following:
(a) Authority. Wavetech has the full right, power and authority
to issue, sell and deliver to DCIC the shares of Wavetech Common
Stock as contemplated by this Agreement. Wavetech shall convey
to DCIC valid and marketable title to such shares, free of any
preemptive rights, options or encumbrances of any kind
whatsoever.
(b) Due Organization. Wavetech is a corporation duly organized,
validly existing and in good standing under the laws of Nevada,
with all requisite corporate power and authority to carry on its
business as now conducted and to own and operate the assets and
properties now owned and operated by it. Wavetech is duly
qualified as a foreign corporation in each jurisdiction where
such qualification is required.
(c) Absence of Material Adverse Changes. Except as has been
previously disclosed in Wavetech's public filings with the
Securities and Exchange Commission or in writing to DCIC, there
has not been any material adverse change in the assets,
operations or financial condition of Wavetech, nor is Wavetech
aware of any events or circumstances which could reasonably be
anticipated to have, with the lapse of time or otherwise, a
material adverse effect upon the assets, operations or financial
condition of Wavetech.
(d) Full Disclosure. Wavetech has provided to DCIC, copies of
all public filings made by Wavetech with the Securities and
Exchange Commission during the preceding five (5) years. Such
filings are accurate, complete and do not contain any untrue
statement of material fact nor do they omit any material
information necessary to make the statements made therein, in
light of the circumstances under which they are made, not
misleading. All of Wavetech's financial statements included in
such filings are true, complete, and accurate and were prepared
in accordance with generally accepted accounting principles.
(e) No Conflict. Neither the execution, delivery and
performance of this Agreement, nor the consummation of the
transactions contemplated hereunder will violate (with or without
giving of notice or the passage of time), be in conflict with,
result in a breach or termination of any provision of, cause the
acceleration of the maturity of any debt or obligation pursuant
to, constitute a default under, or result in the creation or
imposition of any security interest, lien, charge or other
encumbrance upon any property or assets of Wavetech, under
applicable law, or pursuant to or under any of Wavetech's charter
documents or under or pursuant to any indenture, mortgage or
other agreement or understanding, order, judgement, award,
decree, statute, ordinance, or regulation of any kind or
character to which Wavetech is a party or by which Wavetech or
any of its assets is subject or may be bound. Wavetech has not
granted to any third party any options, rights or other interests
in the shares of Wavetech Common Stock to be issued to DCIC
hereunder and Wavetech is not a party to any agreement, contract
or understanding regarding the same. The shares of Wavetech
Common Stock to be issued to DCIC are not subject to any
preemptive or other similar rights.
(f) Consents. No consent, approval or authorization of, or
declaration, filing or registration with any third party,
including any governmental entity, is required by Wavetech in
connection with the execution, delivery and performance by
Wavetech of this Agreement or the consummation of the
transactions contemplated herein
(g) Investment Decision. The Board of Directors of Wavetech has
reviewed all information as it has deemed necessary to make an
informed decision as to the acquisition of the DCIC Common Stock
to be received in exchange for the shares of Wavetech Common
Stock to be issued pursuant to this Agreement. Wavetech has
received copies of all public filings of DCIC made with the
Securities and Exchange Commission during the preceding five (5)
years, including all amendments thereto. Wavetech has reviewed
all of such filings and is familiar with the business condition
and financial condition and results of operations of DCIC as
reported therein. Based upon such review, the Board of Directors
has made an evaluation of the risks associated with making an
investment in the shares of DCIC Common Stock to be received by
Wavetech and it has determined that Wavetech is fully able to
bear such risks.
(h) Restricted Nature of Shares to be Acquired. Wavetech is
acquiring the shares of DCIC Common Stock for investment purposes
only. In addition to the other restrictions set forth in this
Agreement, Wavetech understands that such shares may not be sold,
transferred or otherwise disposed of without registration under
the Securities Act or an exemption therefrom, and that in the
absence of an effective registration statement or an available
exemption from registration, such shares must be held
indefinitely.
II.3 Representations and Warranties of DCIC. DCIC does
hereby represent, warrant and agree with Wavetech as of the
Effective Date, the following:
(a) Authority. DCIC has the full right, power and authority to
issue, sell and deliver to Wavetech the shares of DCIC Common
Stock as contemplated by this Agreement. DCIC shall convey to
Wavetech valid and marketable title to such shares, free of any
preemptive rights, options or encumbrances of any kind
whatsoever.
(b) Due Organization. DCIC is a corporation duly organized,
validly existing and in good standing under the laws of Colorado,
with all requisite corporate power and authority to carry on its
business as now conducted and to own and operate the assets and
properties now owned and operated by it. DCIC is duly qualified
as a foreign corporation in each jurisdiction where such
qualification is required.
(c) Absence of Material Adverse Changes. Except as has been
previously disclosed in DCIC's public filings with the Securities
and Exchange Commission or in writing to Wavetech there has not
been any material adverse change to the assets, operations or
financial condition of DCIC, nor is DCIC aware of any events or
circumstances which could reasonably be anticipated to have, with
the lapse of time or otherwise, a material adverse effect upon
the assets, operations or financial condition of DCIC.
(d) Full Disclosure. DCIC has provided to Wavetech, copies of
all public filings made by DCIC with the Securities and Exchange
Commission during the preceding five (5) years. Such filings are
accurate, complete and do not contain any untrue statement of
material fact nor do they omit any material information necessary
to make the statements made therein, in light of the
circumstances under which they are made, not misleading. All of
DCIC's financial statements included in such filings are true,
complete, accurate and were prepared in accordance with generally
accepted accounting principles.
(e) No Conflict. Neither the execution, delivery and
performance of this Agreement, nor the consummation of the
transactions contemplated hereunder will violate (with or without
giving of notice or the passage of time), be in conflict with,
result in a breach or termination of any provision of, cause the
acceleration of the maturity of any debt or obligation pursuant
to, constitute a default under, or result in the creation or
imposition of any security interest, lien, charge or other
encumbrance upon any property or assets of DCIC, under applicable
law, or pursuant to or under any of DCIC's charter documents or
under or pursuant to any indenture, mortgage or other agreement
or understanding, order, judgement, award, decree, statute,
ordinance, or regulation of any kind or character to which DCIC
is a party or by which DCIC or any of its assets is subject or |
