================================================================================


                       SECURITIES AND EXCHANGE COMMISSION

                             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): May 10, 2000


                          COYOTE NETWORK SYSTEMS, INC.
             ------------------------------------------------------
             (Exact name of Registrant as specified in its charter)


            Delaware                   1-5486                   36-2448698
----------------------------     ---------------------      -------------------
(State or Other Jurisdiction     (Commission File No.)        (IRS Employer
       of Incorporation)                                    Identification No.)


           4360 Park Terrace Drive, Westlake Village, California 91361
           -----------------------------------------------------------
          (Address of principal executive offices, including zip code)

                                 (818) 735-7600
              ----------------------------------------------------
              (Registrant's telephone number, including area code)



================================================================================
<PAGE>

ITEM 5.  Other Events.

Proposed Merger

         On May 10, 2000,  we entered into an Agreement  and Plan of Merger with
Primary  Knowledge,  Inc., a California  corporation  which is in the process of
changing its name to HomeAccess MicroWeb, Inc. ("HomeAccess"),  DQE Enterprises,
Inc., a Pennsylvania  corporation ("DQE"),  Barbara Conrad and Jerry Conrad. The
parties to the Agreement and Plan of Merger subsequently  amended it by entering
into the First  Amendment to Agreement and Plan of Merger dated May 26, 2000 (as
amended,  the  Agreement and Plan of Merger is referred to herein as the "Merger
Agreement"). Under the Merger Agreement, HomeAccess will become our wholly owned
subsidiary through the merger of HomeAccess Acquisition Corp., our newly created
wholly owned subsidiary, with and into HomeAccess (the "Merger").  HomeAccess is
the developer of local community  on-line exchange services that are expected to
enable customers to select, order and pay for products and services on-line from
local merchants using personal computers or less expensive screen phones.

     If consummated,  we will acquire  HomeAccess for approximately  $45,562,500
payable  in shares of our  capital  stock.  Specifically,  we will  issue to DQE
1,384,178  shares of our Series C convertible  preferred stock and will issue to
Barbara Conrad between  3,229,747 and 4,556,250  shares of our common stock (the
actual  number of shares is  dependent  upon the fair market value of our common
stock on the  closing  date).  The Series C  convertible  preferred  stock to be
issued to DQE has a face value of $13,668,758 and bears cumulative  dividends at
an annual  rate of 6%. At any time after the closing  date,  DQE may convert the
shares of our Series C convertible  preferred  stock into 1,952,679 to 1,384,178
shares of our common stock,  with the actual number of shares dependent upon the
fair market value of our common stock on the closing date.  For a period of four
years  after  consummation  of the  Merger,  we have  agreed to issue to DQE and
Barbara  Conrad,  collectively,  two  shares  of our  common  stock for each new
customer  acquired by HomeAccess;  provided the customer has been preapproved by
us and has met certain performance criteria. In no event will the maximum number
of shares issued under this program  exceed 13% of the total number of shares of
our common stock outstanding,  on a fully diluted basis, on the closing date. We
have also agreed to issue to DQE a warrant  exercisable for 3,600,000  shares of
our  common  stock at an  exercise  price of $20 per share if and when we or our
affiliates have delivered 25,000 screen phones to persons or businesses that are
customers of DQE or its associates at the time of delivery.  The warrant will be
exercisable  for a  period  of 3 years  from the  date of its  issue.  DQE is an
investor in and strategic partner with HomeAccess.  In connection with its prior
relationship  with  HomeAccess,  DQE  holds  a  warrant  to  acquire  30% of the
outstanding  capital stock of HomeAccess  for  $7,000,000  and has agreed in the
Merger  Agreement to exercise  this  warrant at or prior to the  closing.  Up to
$2,000,000 of the $7,000,000  may be invested  prior to the closing  without our
consent.

         The Merger Agreement also provides that as of the effective time of the
Merger,  our board of directors will be comprised of seven  directors,  three of
whom will be  designated  by DQE and one of whom will be  designated  by Barbara
Conrad.  The  number of  directors  DQE and  Barbara  Conrad may  designate  for
nomination will be reduced if the number of shares they  beneficially  own falls
below certain ownership percentages.  At the closing, our executive officers and
directors will enter into a voting agreement under which they will agree to vote
all of the shares of common stock they  beneficially own in favor of the DQE and
Barbara Conrad nominees.

         In connection with the Merger Agreement,  we will enter into a personal
services  agreement with Jerry Conrad.  Under the terms of the personal services
agreement, we will loan Jerry Conrad $2,250,000 in accordance with the terms and
provisions of a promissory note. Generally,  if Jerry Conrad remains an employee
of us on the second,  third and fourth  anniversaries  of the closing date,  the
principal and accrued  interest  payable on such dates will be forgiven.  On May
10, 2000, we issued Jerry Conrad non-qualified stock options to purchase 500,000
shares of our common  stock at an exercise  price equal to the fair market value
of our common stock on the date of grant.  These  options will  terminate if the
Merger is not consummated.

         The transactions  contemplated by the Merger  Agreement,  including the
Merger,  are subject to the approval of our stockholders,  the approval of DQE's
board of directors and other customary conditions. Accordingly, we cannot assure
you that the transactions  contemplated by the Merger  Agreement,  including the
Merger, will be consummated.

         The foregoing  summary of the Merger  Agreement  does not purport to be
complete and is subject to, and  qualified in its entirety by reference  to, the
provisions  of the  Agreement  and Plan of  Merger  and the First  Amendment  to
Agreement  and Plan of  Merger,  which  are filed as a  Exhibits  10.1 and 10.2,
respectively, to this Current Report on Form 8-K .

Discontinued Operations

         In May 2000, we made a strategic  decision to discontinue  and sell the
telecommunication  switch  segment of our business and to focus our resources on
the delivery of telephony  and  Internet  services.  To date we have not entered
into any  agreement or  arrangement  with any third party to purchase the assets
related to the switch segment of our business.  With the discontinuance and sale
of our switch segment,  we expect that our main source of revenue will come from
the sale of international and domestic long distance services and local exchange
carrier services in domestic markets.

Item 7.  Financial Statements, Pro Forma Financial Information and Exhibits.


     (c)  Exhibits.

          10.1 Agreement  and Plan of  Merger  dated  May 10,  2000 by and among
               Coyote  Network  Systems,  Inc.,  Primary  Knowledge,  Inc.,  DQE
               Enterprises, Inc., Barbara Conrad and Jerry Conrad.

          10.2 First  Amendment to Agreement  and Plan of Merger,  dated May 26,
               2000,  by  and  among  Coyote  Network  Systems,   Inc.,  Primary
               Knowledge, Inc., DQE Enterprises,  Inc., Barbara Conrad and Jerry
               Conrad.

          99.1 Press Release dated May 30, 2000.



<PAGE>


                                   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, on this 9th day of June, 2000.

                             COYOTE NETWORK SYSTEMS, INC.



                             By:    /s/ Timothy G. Atkinson
                                    -----------------------------------------
                                    Timothy G. Atkinson,
                                    General Counsel and Corporate Secretary


<PAGE>


                                  Exhibit Index

          10.1 Agreement  and Plan of  Merger  dated  May 10,  2000 by and among
               Coyote  Network  Systems,  Inc.,  Primary  Knowledge,  Inc.,  DQE
               Enterprises, Inc., Barbara Conrad and Jerry Conrad.

          10.2 First  Amendment to Agreement  and Plan of Merger,  dated May 26,
               2000,  by  and  among  Coyote  Network  Systems,   Inc.,  Primary
               Knowledge, Inc., DQE Enterprises,  Inc., Barbara Conrad and Jerry
               Conrad.

          99.1 Press Release dated May 30, 2000.
[{"type": "8-K", "sequence": "1", "filename": "0001.txt", "secsgml_size_bytes": 9430}]
{"company-data": {"conformed-name": "COYOTE NETWORK SYSTEMS INC", "cik": "0000057201", "assigned-sic": "3661", "irs-number": "362448698", "state-of-incorporation": "DE", "fiscal-year-end": "0331"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-05486", "film-number": "652491"}, "business-address": {"street1": "4360 PARK TERRACE DRIVE", "city": "WESTLAKE VILLAGE", "state": "CA", "zip": "91361", "phone": "8187357600"}, "mail-address": {"street1": "4360 PARK TERRACE DRIVE", "city": "WESTLAKE VILLAGE", "state": "CA", "zip": "91361"}, "former-company": [{"former-conformed-name": "DIANA CORP", "date-changed": "19920703"}, {"former-conformed-name": "FH INDUSTRIES CORP", "date-changed": "19850814"}, {"former-conformed-name": "SCOT LAD FOODS INC", "date-changed": "19841202"}]}
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION

                             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): May 10, 2000

                          COYOTE NETWORK SYSTEMS, INC.
             ------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

            Delaware                   1-5486                   36-2448698
----------------------------     ---------------------      -------------------
(State or Other Jurisdiction     (Commission File No.)        (IRS Employer
       of Incorporation)                                    Identification No.)

           4360 Park Terrace Drive, Westlake Village, California 91361
           -----------------------------------------------------------
          (Address of principal executive offices, including zip code)

                                 (818) 735-7600
              ----------------------------------------------------
              (Registrant's telephone number, including area code)

================================================================================
ITEM 5.  Other Events.

Proposed Merger

         On May 10, 2000,  we entered into an Agreement  and Plan of Merger with
Primary  Knowledge,  Inc., a California  corporation  which is in the process of
changing its name to HomeAccess MicroWeb, Inc. ("HomeAccess"),  DQE Enterprises,
Inc., a Pennsylvania  corporation ("DQE"),  Barbara Conrad and Jerry Conrad. The
parties to the Agreement and Plan of Merger subsequently  amended it by entering
into the First  Amendment to Agreement and Plan of Merger dated May 26, 2000 (as
amended,  the  Agreement and Plan of Merger is referred to herein as the "Merger
Agreement"). Under the Merger Agreement, HomeAccess will become our wholly owned
subsidiary through the merger of HomeAccess Acquisition Corp., our newly created
wholly owned subsidiary, with and into HomeAccess (the "Merger").  HomeAccess is
the developer of local community  on-line exchange services that are expected to
enable customers to select, order and pay for products and services on-line from
local merchants using personal computers or less expensive screen phones.

     If consummated,  we will acquire  HomeAccess for approximately  $45,562,500
payable  in shares of our  capital  stock.  Specifically,  we will  issue to DQE
1,384,178  shares of our Series C convertible  preferred stock and will issue to
Barbara Conrad between  3,229,747 and 4,556,250  shares of our common stock (the
actual  number of shares is  dependent  upon the fair market value of our common
stock on the  closing  date).  The Series C  convertible  preferred  stock to be
issued to DQE has a face value of $13,668,758 and bears cumulative  dividends at
an annual  rate of 6%. At any time after the closing  date,  DQE may convert the
shares of our Series C convertible  preferred  stock into 1,952,679 to 1,384,178
shares of our common stock,  with the actual number of shares dependent upon the
fair market value of our common stock on the closing date.  For a period of four
years  after  consummation  of the  Merger,  we have  agreed to issue to DQE and
Barbara  Conrad,  collectively,  two  shares  of our  common  stock for each new
customer  acquired by HomeAccess;  provided the customer has been preapproved by
us and has met certain performance criteria. In no event will the maximum number
of shares issued under this program  exceed 13% of the total number of shares of
our common stock outstanding,  on a fully diluted basis, on the closing date. We
have also agreed to issue to DQE a warrant  exercisable for 3,600,000  shares of
our  common  stock at an  exercise  price of $20 per share if and when we or our
affiliates have delivered 25,000 screen phones to persons or businesses that are
customers of DQE or its associates at the time of delivery.  The warrant will be
exercisable  for a  period  of 3 years  from the  date of its  issue.  DQE is an
investor in and strategic partner with HomeAccess.  In connection with its prior
relationship  with  HomeAccess,  DQE  holds  a  warrant  to  acquire  30% of the
outstanding  capital stock of HomeAccess  for  $7,000,000  and has agreed in the
Merger  Agreement to exercise  this  warrant at or prior to the  closing.  Up to
$2,000,000 of the $7,000,000  may be invested  prior to the closing  without our
consent.

         The Merger Agreement also provides that as of the effective time of the
Merger,  our board of directors will be comprised of seven  directors,  three of
whom will be  designated  by DQE and one of whom will be  designated  by Barbara
Conrad.  The  number of  directors  DQE and  Barbara  Conrad may  designate  for
nomination will be reduced if the number of shares they  beneficially  own falls
below certain ownership percentages.  At the closing, our executive officers and
directors will enter into a voting agreement under which they will agree to vote
all of the shares of common stock they  beneficially own in favor of the DQE and
Barbara Conrad nominees.

         In connection with the Merger Agreement,  we will enter into a personal
services  agreement with Jerry Conrad.  Under the terms of the personal services
agreement, we will loan Jerry Conrad $2,250,000 in accordance with the terms and
provisions of a promissory note. Generally,  if Jerry Conrad remains an employee
of us on the second,  third and fourth  anniversaries  of the closing date,  the
principal and accrued  interest  payable on such dates will be forgiven.  On May
10, 2000, we issued Jerry Conrad non-qualified stock options to purchase 500,000
shares of our common  stock at an exercise  price equal to the fair market value
of our common stock on the date of grant.  These  options will  terminate if the
Merger is not consummated.

         The transactions  contemplated by the Merger  Agreement,  including the
Merger,  are subject to the approval of our stockholders,  the approval of DQE's
board of directors and other customary conditions. Accordingly, we cannot assure
you that the transactions  contemplated by the Merger  Agreement,  including the
Merger, will be consummated.

         The foregoing  summary of the Merger  Agreement  does not purport to be
complete and is subject to, and  qualified in its entirety by reference  to, the
provisions  of the  Agreement  and Plan of  Merger  and the First  Amendment  to
Agreement  and Plan of  Merger,  which  are filed as a  Exhibits  10.1 and 10.2,
respectively, to this Current Report on Form 8-K .

Discontinued Operations

         In May 2000, we made a strategic  decision to discontinue  and sell the
telecommunication  switch  segment of our business and to focus our resources on
the delivery of telephony  and  Internet  services.  To date we have not entered
into any  agreement or  arrangement  with any third party to purchase the assets
related to the switch segment of our business.  With the discontinuance and sale
of our switch segment,  we expect that our main source of revenue will come from
the sale of international and domestic long distance services and local exchange
carrier services in domestic markets.

Item 7.  Financial Statements, Pro Forma Financial Information and Exhibits.

     (c)  Exhibits.

          10.1 Agreement  and Plan of  Merger  dated  May 10,  2000 by and among
               Coyote  Network  Systems,  Inc.,  Primary  Knowledge,  Inc.,  DQE
               Enterprises, Inc., Barbara Conrad and Jerry Conrad.

          10.2 First  Amendment to Agreement  and Plan of Merger,  dated May 26,
               2000,  by  and  among  Coyote  Network  Systems,   Inc.,  Primary
               Knowledge, Inc., DQE Enterprises,  Inc., Barbara Conrad and Jerry
               Conrad.

          99.1 Press Release dated May 30, 2000.
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, on this 9th day of June, 2000.

                             COYOTE NETWORK SYSTEMS, INC.

                             By:    /s/ Timothy G. Atkinson
                                    -----------------------------------------
                                    Timothy G. Atkinson,
                                    General Counsel and Corporate Secretary
Exhibit Index

          10.1 Agreement  and Plan of  Merger  dated  May 10,  2000 by and among
               Coyote  Network  Systems,  Inc.,  Primary  Knowledge,  Inc.,  DQE
               Enterprises, Inc., Barbara Conrad and Jerry Conrad.

          10.2 First  Amendment to Agreement  and Plan of Merger,  dated May 26,
               2000,  by  and  among  Coyote  Network  Systems,   Inc.,  Primary
               Knowledge, Inc., DQE Enterprises,  Inc., Barbara Conrad and Jerry
               Conrad.

          99.1 Press Release dated May 30, 2000.