AND EXCHANGE COMMISSION
Section 13 or 15(d) of the
Exchange Act of 1934
of report (Date of earliest event reported): November 13, 2019
Telecom Group, Inc.
Name of Registrant as Specified in Its Charter)
or Other Jurisdiction of Incorporation)
Employer Identification No.)
of Principal Executive Offices)
Telephone Number, Including Area Code)
Name or Former Address, if Changed Since Last Report)
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Growth Company [ ]
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
of each class
of each exchange on which registered
7.01 Regulation FD Disclosure.
November 13, 2019, Wireless Telecom Group, Inc. (“the Company”) signed a definitive agreement to acquire Holzworth
Instrumentation Inc. (“Holzworth”) a Boulder, Colorado based provider of specialty phase noise analyzers and signal
generators. For the 9-month period (unaudited) ended September 30, 2019, Holzworth’s revenues were approximately
instruments are used by government labs, the semiconductor industry, and network equipment providers, among others, in research
and automated test environments. The Company expects to close this acquisition in the months ahead.
definitive agreement provides for an initial purchase price for Holzworth of $8.0 million of cash payable at closing, $1.5 million
in deferred cash payments, and $500,000 of Wireless Telecom Group Inc. common stock based on the 90-day volume weighted average
share price of $1.44 per share, which shares are subject to a 36-month lock-up provision. The two deferred purchase price payments
are $750,000 each ($1.5 million in total), and may be reduced if Holzworth’s earnings before interest expense, tax expense,
depreciation expense and amortization expense (“EBITDA”), as defined in the acquisition agreement, for the twelve
months ended December 31, 2019 or 2020 is less than $1.25 million. In addition, the Company has agreed to make two earnout payments
of up to a maximum of $7.0 million in total, the amount of which will be determined based on Holzworth’s EBITDA, as defined
in the acquisition agreement, above $1.25 million for the twelve months ended December 31, 2020 and December 31, 2021. Finally,
the Company and Holzworth have agreed to a final purchase price adjustment based on Holzworth’s closing date working capital,
as defined in the acquisition agreement.
transaction is conditioned upon the Company obtaining anticipated proceeds from a debt financing in an amount sufficient to pay
the total closing cash consideration of the acquisition of $8.0 million. The Company is engaged in a process to obtain such financing.
first deferred purchase price payment of $750,000 is due in three equal quarterly installments on March 31, 2020, June 30, 2020
and September 30, 2020. The second deferred purchase price payment of $750,000 is payable on March 31, 2021. The first earnout
payment is due no later than March 31, 2021 and will be an amount equal to two times the excess Holzworth EBITDA, as defined,
above $1.25 million as calculated for the twelve-month period ended December 31, 2020. The second earnout payment is due no later
than March 31, 2022 and will be an amount equal to two times the excess Holzworth EBITDA, as defined, above $1.25 million for
the twelve-month period ended December 31, 2021 less the first earnout payment.
Holzworth acquisition agreement includes customary representations and warranties and indemnifications of both the Company and
Holzworth and is subject to customary closing conditions in addition to the condition of the Company obtaining debt financing
sufficient to pay the cash consideration.
Form 8-K contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, such forward-looking statements may
be identified by terms such as believe, expect, seek, may, will, intend, project, anticipate, plan, estimate, guidance or similar
words. Forward-looking statements include, among others, statements regarding our expectation that the Holzworth acquisition will
close in the months ahead. Investors are cautioned that such forward-looking statements are not guarantees of future performance
and involve a number of risks and uncertainties that could materially affect actual results, including, among others, the ability
of the Company to obtain appropriate debt financing for the transaction on favorable terms or at all, as well as other risks and
uncertainties set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. These forward-looking
statements speak only as of the date of this release and the Company does not undertake any obligation to update or revise any
forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise, as except
as required by law.
November 14, 2019, the Company issued a press release announcing the acquisition of Holzworth. A copy of the press release is
furnished as Exhibit 99.1 to this Current Report on Form 8-K.
9.01 Financial Statements and Exhibits.
Press release, dated November 14, 2019, issued by Wireless Telecom Group, Inc. announcing the acquisition of Holzworth Instrumentation
to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
TELECOM GROUP, INC.
November 14, 2019
Michael J Kandell
Financial Officer and Corporate Secretary