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EX-99.4 - EX-99.4 - CSC HOLDINGS LLC | x78599kexv99w4.htm |
EX-99.3 - EX-99.3 - CSC HOLDINGS LLC | x78599kexv99w3.htm |
EX-99.1 - EX-99.1 - CSC HOLDINGS LLC | x78599kexv99w1.htm |
EX-99.2 - EX-99.2 - CSC HOLDINGS LLC | x78599kexv99w2.htm |
EX-99.6 - EX-99.6 - CSC HOLDINGS LLC | x78599kexv99w6.htm |
EX-99.5 - EX-99.5 - CSC HOLDINGS LLC | x78599kexv99w5.htm |
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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):
January 12, 2010
January 12, 2010
CABLEVISION SYSTEMS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware | No. 1-14764 | No. 11-3415180 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
CSC HOLDINGS, LLC
(Exact name of registrant as specified in its charter)
Delaware | No. 1-9046 | No. 27-0726696 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
1111 Stewart Avenue | ||
Bethpage, New York | 11714 | |
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code: (516) 803-2300
N/A
(Former name or former address, if changed since last report)
Check 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:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
TABLE OF CONTENTS
Item 1.01 Entry into a Material Definitive Agreement. | ||||||||
Item 8.01 Other Events | ||||||||
Item 9.01 Financial Statements and Exhibits | ||||||||
SIGNATURES | ||||||||
EX-99.1 | ||||||||
EX-99.2 | ||||||||
EX-99.3 | ||||||||
EX-99.4 | ||||||||
EX-99.5 | ||||||||
EX-99.6 |
Table of Contents
Item 1.01 | Entry into a Material Definitive Agreement. |
Cablevision Systems Corporation (Cablevision) has entered into two registration rights
agreements with Dolan family interests, which are described below and which replace the two
previously existing registration rights agreements between Cablevision and Dolan family interests.
On January 13, 2010, Cablevision entered into a registration rights agreement (the Dolan
Registration Rights Agreement), with Charles F. Dolan, the
Chairman of Cablevision, and all other
holders of Cablevision NY Group Class B Common Stock (other than the Charles F. Dolan Children
Trusts referred to below), the Dolan Childrens Foundation and the Dolan Family Foundation. Under
this agreement, Cablevision will provide the parties to the Dolan Registration Rights Agreement
(the Dolan Parties) (and, in certain cases, transferees and pledgees of shares of Cablevision NY
Group Class B Common Stock owned by these parties) with certain demand and piggyback registration
rights with respect to their shares of Cablevision NY Group Class A Common Stock (including those
issued upon conversion of shares of Cablevision NY Group Class B Common Stock). The Dolan Parties own
approximately 32.5 million shares of Cablevision NY Group Class B Common Stock (the Dolan
Shares), which represent approximately 59.8% of the outstanding Cablevision NY Group Class B
Common Stock as well as approximately 3.4 million shares of Cablevision NY Group Class A Common
Stock, which represent approximately 1.4% of the outstanding Cablevision NY Group Class A Common
Stock. Such shares of Cablevision NY Group Class B Common Stock and Cablevision NY Group Class A
Common Stock, collectively, represent approximately 11.9% of Cablevisions outstanding common stock
and 41.5% of the aggregate voting power of Cablevisions outstanding common stock.
Also on January 13, 2010, the Charles F. Dolan Children Trusts (the Children Trusts) and
Cablevision entered into a registration rights agreement (the Children Trusts Registration Rights
Agreement). Under this agreement, Cablevision will provide the Children Trusts (and, in certain
cases, transferees and pledgees of shares of Cablevision NY Group Class B Common Stock owned by
these parties) with certain demand and piggy-back registration rights with respect to their shares
of Cablevision NY Group Class A Common Stock (including those issued upon conversion of shares of
Cablevision NY Group Class B Common Stock). The Children Trusts own approximately 21.9 million
shares of Cablevision NY Group Class B Common Stock (the Children Trust Shares), which represent
approximately 40.2% of the outstanding Cablevision NY Group Class B Common Stock, as well as
approximately 1.1 million shares of Cablevision NY Group Class A Common Stock, which represent
approximately 0.4% of the outstanding Cablevision NY Group Class A Common Stock. Such shares of
Cablevision NY Group Class B Common Stock and Cablevision NY Group Class A Common Stock,
collectively, represent approximately 7.6% of Cablevisions common stock and 27.8% of the aggregate
voting power of Cablevisions outstanding common stock.
In the Children Trusts Registration Rights Agreement, each Children Trust will agree that in
the case of any sale or disposition of its shares of Cablevisions NY Group Class B Common Stock
(other than to Charles F. Dolan or other Dolan family interests) by such Children Trust, or of any
of the Children Trust Shares by any other Dolan family interest to which such
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shares of Cablevision NY Group Class B Common Stock are transferred, such stock will be
converted to Cablevision NY Group Class A Common Stock. The Dolan Registration Rights Agreement
does not include a comparable conversion obligation, and the conversion obligation in the Children
Trusts Registration Rights Agreement does not apply to the Dolan Shares.
The Dolan Registration Rights Agreement and the Children Trusts Registration Rights Agreement
are included as exhibits to this Form 8-K and the foregoing discussion of those agreements is
qualified in its entirety by reference to those agreements as so filed.
Item 8.01 | Other Events |
Distribution of Madison Square Garden, Inc.
On
January 12, 2010, the Board of Directors of Cablevision approved the
distribution of all of the common stock of Madison Square Garden, Inc. (MSG), a company which
owns the sports, entertainment and media businesses previously owned and operated by the MSG
segment of Cablevision, to the stockholders of Cablevision (the Distribution). The Distribution
will take the form of a distribution by Cablevision of one share of MSG Class A Common Stock for
every four shares of Cablevision NY Group Class A Common Stock held of record at the close of
business in New York City on January 25, 2010 (the Record Date) and one share of MSG Class B
Common Stock for every four shares of Cablevision NY Group Class B Common Stock held of record on
the Record Date. The Distribution will become effective and the new shares will be distributed on
February 9, 2010.
On January 12, 2010, the Board of Directors of CSC Holdings, LLC (CSC Holdings) authorized
the distribution to Cablevision Systems Corporation (Cablevision), its sole member, of all of the
common stock of MSG. This transaction will take place prior to the Distribution by Cablevision.
MSG has filed with the Securities and Exchange Commission a registration statement on Form 10
that contains information about MSG and the Distribution. Prior to the Distribution, Cablevision
will distribute to its stockholders copies of an Information Statement relating to MSG that is part
of the Form 10 filing.
Management Arrangements
As discussed in Cablevisions Form 8-K, filed on December 24, 2009, Mr. James L. Dolan will be
the Executive Chairman of MSG and will devote a portion of his business time to that role. He will
retain his position as Cablevisions President and Chief Executive Officer and will devote most of
his business time to that role.
Hank J. Ratner will be the President and Chief Executive Officer of MSG. It is expected that
he will devote a majority of his time to that role but will also retain his position as
Cablevisions Vice Chairman and will devote a portion of his time to that role.
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The following directors of Cablevision will also become directors of MSG in connection with
the Distribution: Charles F. Dolan, James L. Dolan, Thomas C. Dolan, Deborah A. Dolan-Sweeney,
Marianne Dolan Weber, Brad Dorsogna, Brian G. Sweeney and Vincent Tese.
Agreements with Madison Square Garden, Inc.
Following the Distribution, MSG will be a public company and Cablevision will have no
continuing common stock ownership interest in MSG. For purposes of governing the ongoing
relationships between Cablevision and MSG after the Distribution and to provide for an orderly
transition, Cablevision and MSG have entered, or will enter, into the agreements described below
prior to the Distribution.
Certain of the agreements summarized below are included as exhibits to this Form 8-K, and the
following summaries of those agreements are qualified in their entirety by reference to the
agreements as so filed.
Distribution Agreement
Cablevision and MSG have entered into the Distribution Agreement. Under the Distribution
Agreement, Cablevision provides MSG with indemnities with respect to liabilities, damages, costs
and expenses arising out of any of (i) Cablevisions businesses (other than businesses of MSG),
(ii) certain identified claims or proceedings, (iii) any breach by Cablevision of its obligations
under the Distribution Agreement; (iv) any untrue statement or omission in the Form 10 registration
statement or the information statement that is part of the Form 10 relating to Cablevision and its
subsidiaries; and (v) indemnification obligations MSG may have to the National Basketball
Association (NBA) or the National Hockey League (NHL) that result from acts or omissions of
Cablevision. MSG provides Cablevision with indemnities with respect to liabilities, damages, costs
and expenses arising out of any of (i) MSGs businesses, (ii) any breach by MSG of its obligations
under the Distribution Agreement; and (iii) any untrue statement or omission in the Form 10
registration statement or the information statement that is part of the Form 10 other than any such
statement or omission relating to Cablevision and its subsidiaries.
In the Distribution Agreement, MSG releases Cablevision from any claims it might have arising
out of:
| the management of the businesses and affairs of Madison Square Garden on or prior to the Distribution; |
| the terms of the Distribution, MSGs amended and restated certificate of incorporation, MSGs by-laws and the other agreements entered into in connection with the Distribution; and |
| any decisions that have been made, or actions taken, relating to MSG or the Distribution. |
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The Distribution Agreement also provides that Cablevision will have the sole and absolute
discretion to determine whether to proceed with the Distribution, including the form, structure and
terms of any transactions to effect the Distribution and the timing of and satisfaction of
conditions to the consummation of the Distribution.
The Distribution Agreement also provides for access to records and information, cooperation in
defending litigation, as well as methods of resolution for certain disputes.
Transition Services Agreement
Cablevision and MSG have entered into a Transition Services Agreement under which, in exchange
for the fees specified in such agreement, Cablevision agrees to provide transition services with
regard to such areas as tax, information technology, insurance and employee recruiting,
compensation and benefits. MSG will agree to provide transition services to Cablevision with regard
to those information technology systems that MSG and Cablevision may share. Cablevision and MSG, as
parties receiving services under the agreement, have agreed to indemnify the party providing
services for losses incurred by such party that arise out of or are otherwise in connection with
the provision by such party of services under the agreement, except to the extent that such losses
result from the providing partys gross negligence, willful misconduct or breach of its obligations
under the agreement. Similarly, each party providing services under the agreement will agree to
indemnify the party receiving services for losses incurred by such party that arise out of or are
otherwise in connection with the indemnifying partys provision of services under the agreement if
such losses result from the providing partys gross negligence, willful misconduct or breach of its
obligations under the agreement.
Tax Disaffiliation Agreement
Cablevision and MSG have entered into a Tax Disaffiliation Agreement that governs their
respective rights, responsibilities and obligations with respect to taxes and tax benefits, the
filing of tax returns, the control of audits and other tax matters. References in this summary
description of the Tax Disaffiliation Agreement to the terms tax or taxes mean taxes as well as
any interest, penalties, additions to tax or additional amounts in respect of such taxes.
MSG and its eligible subsidiaries currently join with Cablevision in the filing of a
consolidated return for U.S. federal income tax purposes and also join with Cablevision in the
filing of certain consolidated, combined, and unitary returns for state, local, and other
applicable tax purposes. However, for periods (or portions thereof) beginning after the
Distribution, MSG generally will not join with Cablevision in the filing of any federal, state,
local or other applicable consolidated, combined or unitary tax returns.
Under the Tax Disaffiliation Agreement, except for certain New York City income taxes,
Cablevision will be responsible for all of MSGs federal, state, local and other applicable income
taxes for any taxable period or portion of such period ending on or before the date of the
Distribution.
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MSG will be responsible for all other taxes (including certain New York City income taxes) for
all taxable periods ending on or before the date of the Distribution, and all taxes that are
attributable to MSG or one of its subsidiaries after the date of the Distribution. Notwithstanding
the Tax Disaffiliation Agreement, under U.S. Treasury Regulations, each member of a consolidated
group is severally liable for the United States federal income tax liability of each other member
of the consolidated group. Accordingly, with respect to periods in which MSG has been included in
Cablevisions consolidated group, MSG could be liable to the United States government for any
United States federal income tax liability incurred, but not discharged, by any other member of
such consolidated group. However, if any such liability were imposed, MSG would generally be
entitled to be indemnified by Cablevision for tax liabilities allocated to Cablevision under the
Tax Disaffiliation Agreement. MSG will be responsible for filing all tax returns for any period
ending after the date of the Distribution that include MSG or one of its subsidiaries other than
any consolidated, combined or unitary income tax return for periods after such date (if any) that
includes MSG or one of its subsidiaries, on the one hand, and Cablevision or one of its
subsidiaries (other than MSG or any of its subsidiaries), on the other hand. MSG also will be
responsible for filing, for all periods, all returns related to certain New York City income taxes
that include MSG or one of its subsidiaries. Where possible, MSG has waived the right to carry back
any losses, credits, or similar items to periods ending prior to or on the date of the
Distribution, however, if MSG cannot waive the right, MSG would be entitled to receive the
resulting refund or credit, net of any taxes incurred by Cablevision with respect to the refund or
credit.
Generally, MSG will have the authority to conduct all tax proceedings, including tax audits,
relating to taxes or any adjustment to taxes for which MSG is responsible for filing a return under
the Tax Disaffiliation Agreement, and Cablevision will have the authority to conduct all tax
proceedings, including tax audits, relating to taxes or any adjustment to taxes for which
Cablevision is responsible for filing a return under the Tax Disaffiliation Agreement. However, if
one party acknowledges a liability to indemnify the other party for a tax to which such proceeding
relates, and provides evidence to the other party of its ability to make such payment, the
first-mentioned party will have the authority to conduct such proceeding. The Tax Disaffiliation
Agreement further provides for cooperation between Cablevision and MSG with respect to tax matters,
the exchange of information and the retention of records that may affect the tax liabilities of the
parties to the agreement.
Finally,
the Tax Disaffiliation Agreement provides that none of Cablevision, MSG or any of
their respective subsidiaries will take, or fail to take, any action where such action, or failure
to act, would be inconsistent with or preclude the Distribution from qualifying as a tax-free
transaction to Cablevision and to its stockholders under Section 355 of the Code, or would
otherwise cause holders of Cablevision stock receiving MSG stock in the Distribution to be taxed as
a result of the Distribution and certain transactions undertaken in connection with the
Distribution. Additionally, for the two-year period following the Distribution, Cablevision and MSG
may not engage in certain activities that may jeopardize the tax-free treatment of the Distribution
to Cablevision and its stockholders, unless, in the case of MSG, MSG receives Cablevisions
consent or otherwise obtains a ruling from the IRS or a legal opinion, in either
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case reasonably satisfactory to Cablevision, that the activity will not alter the tax-free
status of the Distribution to Cablevision and its stockholders.
Moreover, MSG must indemnify Cablevision and its subsidiaries, officers and directors for any
taxes, resulting from action or failure to act, if such action or failure to act precludes the
Distribution from qualifying as a tax-free transaction (including taxes imposed as a result of a
violation of the restrictions set forth above). Cablevision must indemnify MSG and its
subsidiaries, officers and directors for any taxes resulting from
action or failure to act, if such
action or failure to act precludes the Distribution from qualifying as a tax-free transaction
(including taxes imposed as a result of a violation of the restrictions set forth above).
Employee Matters Agreement
Cablevision and MSG have entered into an Employee Matters Agreement that allocates assets,
liabilities and responsibilities with respect to certain employee compensation and benefit plans
and programs and certain other related matters. In general, MSG employees currently participate in
various Cablevision retirement, health and welfare, and other employee benefit plans. After the
Distribution, it is anticipated that MSG employees will generally participate in similar plans and
arrangements established and maintained by MSG; however, MSG shall continue to be a participating
company in certain Cablevision employee benefit plans during a transition period. Effective as of
the date of the Distribution, MSG and Cablevision will each hold responsibility for their
respective employees and compensation plans.
Other
In connection with the Distribution, Cablevision will also enter into a number of commercial
and technical arrangements and agreements with MSG. These will
include arrangements for MSGs use of equipment, offices and other premises, lease of transponders, provision of
technical and transport services and vendor services, lease of titles in film and other libraries,
access to technology, affiliation agreements with MSG programming services and for Cablevisions
sponsorship of MSG and its professional sports teams.
Treatment of Outstanding Cablevision Options, Rights, Restricted Stock, Restricted Stock Units and
Other Awards
Cablevision has issued options to purchase, and stock appreciation rights in respect of, its
Cablevision NY Group Class A Common Stock. In connection with the Distribution, each Cablevision
option will become two options: one will be an option to acquire Cablevision NY Group Class A
Common Stock and one an option to acquire MSG Class A Common Stock. Similarly, each right will
become a right with respect to Cablevision NY Group Class A Common Stock and a right with respect
to MSG Class A Common Stock. The existing exercise price will be allocated between the existing
Cablevision options/rights and the new MSG options/rights based upon the ten-day weighted average
prices of the Cablevision NY Group Class A Common Stock and the MSG Class A Common Stock
immediately following the Distribution, and the underlying share amount will take into account the
1:4 distribution ratio in the Distribution. The Cablevision options/rights and the new MSG
options/rights will not be
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exercisable during a period beginning on a date prior to the Distribution determined by
Cablevision in its sole discretion, and continuing until the exercise prices of the Cablevision
options/rights and the new MSG options/rights are determined after the Distribution, or such longer
period as Cablevision or MSG determine is necessary. Other than the split of the Cablevision
options and rights and the allocation of the existing exercise price, there will be no additional
adjustment to the existing Cablevision options and rights in connection with the Distribution and
the terms of each employees applicable Cablevision award agreement will continue to govern the
Cablevision options and rights.
Cablevision has issued restricted stock to its employees which vests according to a vesting
schedule that was established when the shares were issued. In connection with the Distribution each
holder of a Cablevision restricted share will receive one share of MSG Class A Common Stock in
respect of each four Cablevision restricted shares. These MSG shares will be subject to the same
conditions and restrictions as the Cablevision restricted shares in respect of which they are
issued. Following the Distribution, if a holder of Cablevision restricted stock forfeits such
restricted stock and therefore forfeits the MSG accompanying shares, Cablevision will return the
restricted MSG shares to MSG.
Cablevision has issued restricted stock units to its non-employee directors which represent
unfunded, unsecured rights to receive shares of Cablevision NY Group Class A Common Stock (or cash
or other property) at a future date upon the satisfaction of the conditions specified by the
Compensation Committee in the award agreement. Such restricted stock units were fully vested on the
date of grant. In connection with the Distribution, each holder of a restricted stock unit will
receive one share of MSG Class A Common Stock in respect of each four Cablevision restricted stock
units owned on the record date and continue to be entitled to a share of Cablevision NY Group Class
A Common Stock (or cash or other property) in accordance with the award agreement. Cablevision has
issued to its non-employee directors options to purchase its Cablevision NY Group Class A Common
Stock, and such options are fully vested. In connection with the Distribution, each Cablevision
option will become two options: one will be an option to acquire Cablevision NY Group Class A
Common Stock and one an option to acquire MSG Class A Common Stock. The allocation of exercise
price between the existing non-employee director Cablevision options and MSGs new non-employee
director options and the number of shares subject to those new options will be determined in the
same manner as described above.
In 2008 and 2009, Cablevision granted three-year performance awards under Cablevisions 2006 CIP. The performance objectives in each employees applicable award
agreement are required to be adjusted to reflect the exclusion of the MSG business from the
business of Cablevision.
Deferred compensation awards granted by Cablevision pursuant to Cablevisions Long-Term
Incentive Plan (which was superseded by Cablevisions Cash Incentive Plan in 2006) will be
unaffected by the Distribution.
With respect to outstanding long-term cash and equity awards, Cablevision and MSG will not be
regarded as competitive entities of each other for purposes of any non-compete
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provisions contained in the applicable award agreements. With respect to all outstanding
Cablevision awards (and MSG options and stock appreciation rights issued in connection with such
awards) holders of such awards will continue to vest in them so long as they remain employed by
Cablevision, MSG or affiliates of either entity, provided that an employee who moves between
Cablevision or one of its subsidiaries, on the one hand, and MSG or one of its subsidiaries, on the
other hand, at a time when the two entities are no longer affiliates will not continue to vest in
the awards and such change will constitute a termination of employment for purposes of the award
agreement. Notwithstanding the foregoing, Messrs. James L. Dolan and Hank J. Ratner will continue
to vest in their outstanding Cablevision awards (as well as in MSG stock options and stock
appreciation rights issued upon the Distribution with respect to such outstanding Cablevision
awards) based solely on their continued service with Cablevision and not in respect of their
continued service with MSG and its subsidiaries.
Cablevision will be responsible for any payments associated with any annual, long-term cash or
deferred compensation award granted by Cablevision to Mr. James
L. Dolan or Mr. Hank J. Ratner that is
outstanding as of the Distribution.
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Item 9.01 | Financial Statements and Exhibits |
(d)
99.1 Distribution Agreement between Cablevision Systems Corporation and Madison Square Garden,
Inc.
99.2 Transition Services Agreement between Cablevision Systems Corporation and Madison Square
Garden, Inc.
99.3 Tax Disaffiliation Agreement between Cablevision Systems Corporation and Madison Square
Garden, Inc.
99.4 Employee Matters Agreement between Cablevision Systems Corporation and Madison Square
Garden, Inc.
99.5 Registration Rights Agreement between Cablevision Systems Corporation and The Charles F.
Dolan Children Trusts.
99.6 Registration Rights Agreement between Cablevision Systems Corporation and Charles F.
Dolan and certain Dolan Family Affiliates.
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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.
CABLEVISION SYSTEMS CORPORATION (Registrant) |
||||
By: | /s/ Michael P. Huseby | |||
Name: | Michael P. Huseby | |||
Title: | Executive Vice President and Chief Financial Officer | |||
Dated:
January 15, 2010
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.
CSC HOLDINGS, LLC (Registrant) |
||||
By: | /s/ Michael P. Huseby | |||
Name: | Michael P. Huseby | |||
Dated: January 15, 2010 | Title: | Executive Vice President and Chief Financial Officer | ||
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