<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 3)
PEGASUS COMMUNICATIONS CORPORATION
- --------------------------------------------------------------------------------
(Name of Issuer)
Class A Common Stock
- --------------------------------------------------------------------------------
(Title of Class of Securities)
705904 10 0
- --------------------------------------------------------------------------------
(CUSIP Number)
Michael B. Jordan
Drinker Biddle & Reath, LLP
One Logan Square
18th and Cherry Streets
Philadelphia, PA 19103-6996
(215) 988-2700
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 5, 2000
- --------------------------------------------------------------------------------
(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: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
- ---------------------------------------------- ----------------------------------------------
CUSIP No. 705904 10 0 Page 2 of 31 Pages
- ---------------------------------------------- ----------------------------------------------
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Marshall W. Pagon
S.S. No.
- -----------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- -----------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY
OWNED BY EACH -0-
REPORTING PERSON
WITH
------------------------------------------------------------------------------------------
8 SHARED VOTING POWER
8,146,151
------------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
4,801,418
------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
96,772
- -----------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,146,151
- -----------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- -----------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
30.3%
- -----------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
- ---------------------------------------------- ----------------------------------------------
CUSIP No. 705904 10 0 Page 3 of 31 Pages
- ---------------------------------------------- ----------------------------------------------
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Pegasus Communications Holdings, Inc.
IRS Identification No. 23-2778524
- -----------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- -----------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY
OWNED BY EACH -0-
REPORTING PERSON
WITH
------------------------------------------------------------------------------------------
8 SHARED VOTING POWER
6,612,513
------------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,364,552
- -----------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,612,513
- -----------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- -----------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
26.0%
- -----------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
- ---------------------------------------------- ----------------------------------------------
CUSIP No. 705904 10 0 Page 4 of 31 Pages
- ---------------------------------------------- ----------------------------------------------
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Pegasus Communications Limited Partnership
IRS Identification No. 06-1149248
- -----------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- -----------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Connecticut
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY
OWNED BY EACH -0-
REPORTING PERSON
WITH
------------------------------------------------------------------------------------------
8 SHARED VOTING POWER
6,612,513
------------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,364,552
- -----------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,612,513
- -----------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- -----------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
26.0%
- -----------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
PN
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
- ---------------------------------------------- ----------------------------------------------
CUSIP No. 705904 10 0 Page 5 of 31 Pages
- ---------------------------------------------- ----------------------------------------------
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Northwest Management Associates, L.P.
IRS Identification No. 23-2654154
- -----------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- -----------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Pennsylvania
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY
OWNED BY EACH -0-
REPORTING PERSON
WITH
------------------------------------------------------------------------------------------
8 SHARED VOTING POWER
6,612,513
------------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,364,552
- -----------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,612,513
- -----------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- -----------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
26.0%
- -----------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
PN
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
- ---------------------------------------------- ----------------------------------------------
CUSIP No. 705904 10 0 Page 6 of 31 Pages
- ---------------------------------------------- ----------------------------------------------
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Pegasus Cable Associates, Ltd.
IRS Identification No. 23-2641841
- -----------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- -----------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- -----------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Pennsylvania
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY
OWNED BY EACH -0-
REPORTING PERSON
WITH
------------------------------------------------------------------------------------------
8 SHARED VOTING POWER
6,612,513
------------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,364,552
- -----------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,612,513
- -----------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- -----------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
26.0%
- -----------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
- ---------------------------------------------- ----------------------------------------------
CUSIP No. 705904 10 0 Page 7 of 31 Pages
- ---------------------------------------------- ----------------------------------------------
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Pegasus Northwest Offer Corp
IRS Identification No. 23-2943020
- -----------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- -----------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY
OWNED BY EACH -0-
REPORTING PERSON
WITH
------------------------------------------------------------------------------------------
8 SHARED VOTING POWER
3,370,229
------------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
122,338
- -----------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,370,229
- -----------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- -----------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
15.2%
- -----------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
- ---------------------------------------------- ----------------------------------------------
CUSIP No. 705904 10 0 Page 8 of 31 Pages
- ---------------------------------------------- ----------------------------------------------
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Pegasus Scranton Offer Corp
IRS Identification No. 23-2943021
- -----------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- -----------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY
OWNED BY EACH -0-
REPORTING PERSON
WITH
------------------------------------------------------------------------------------------
8 SHARED VOTING POWER
3,336,319
------------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
118,358
- -----------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,336,319
- -----------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- -----------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
15.0%
- -----------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
- ---------------------------------------------- ----------------------------------------------
CUSIP No. 705904 10 0 Page 9 of 31 Pages
- ---------------------------------------------- ----------------------------------------------
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Pegasus Capital, L.P.
IRS Identification No. 23-2661759
- -----------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- -----------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Pennsylvania
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY
OWNED BY EACH -0-
REPORTING PERSON
WITH
------------------------------------------------------------------------------------------
8 SHARED VOTING POWER
4,465,309
------------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
1,217,348
- -----------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,465,309
- -----------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- -----------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.2%
- -----------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
PN
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
- ---------------------------------------------- ----------------------------------------------
CUSIP No. 705904 10 0 Page 10 of 31 Pages
- ---------------------------------------------- ----------------------------------------------
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Pegasus Capital, Ltd.
IRS Identification No. 23-2660588
- -----------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- -----------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- -----------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Pennsylvania
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY
OWNED BY EACH -0-
REPORTING PERSON
WITH
------------------------------------------------------------------------------------------
8 SHARED VOTING POWER
4,465,309
------------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
4,465,309
- -----------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,363,004
- -----------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- -----------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.2%
- -----------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
Introductory Statement
This amendment is filed to report changes in the statement on Schedule
13D dated October 18, 1996, as amended, filed with the Commission by the
Reporting Persons identified herein.
Item 1. Security and Issuer.
This statement relates to the Class A Common Stock, par value $0.01 per
share (the "Class A Common Stock"), of Pegasus Communications Corporation (the
"Issuer"). The Issuer is a Delaware corporation, and its principal executive
office is c/o Pegasus Communications Management Company, 225 City Line Avenue,
Suite 200, Bala Cynwyd, Pennsylvania 19004 (the "Bala Cynwyd Office").
Item 2. Identity and Background.
This amendment is being filed by the following persons (hereinafter
referred to collectively as the "Reporting Persons"):
(i) Marshall W. Pagon, a citizen of the United States of America
(ii) Pegasus Communications Holdings, Inc., a Delaware corporation
("PCH")
(iii) Pegasus Northwest Offer Corp, a Delaware corporation ("PNOC")
(iv) Pegasus Scranton Offer Corp, a Delaware corporation ("PSOC")
(v) Pegasus Communications Limited Partnership, a Connecticut
limited partnership ("PCLP")
(vi) Northwest Management Associates, L.P., a Pennsylvania limited
partnership ("Northwest Management")
(vii) Pegasus Cable Associates, Ltd., a Pennsylvania corporation
("Pegasus Cable")
(viii) Pegasus Capital, L.P., a Pennsylvania limited partnership
(ix) Pegasus Capital, Ltd., a Pennsylvania corporation
Mr. Pagon has been authorized, pursuant to an agreement among the
Reporting Persons identified in (ii) through (vii) above (which agreement was
filed as Exhibit 1 to the statement on Schedule 13D amended by this amendment),
to file this joint statement on behalf of each of them, as permitted by Rule
13d-1(f) under the Securities Exchange Act of 1934.
-1-
<PAGE>
Shares of the Issuer's Class B Common Stock, par value $0.01 per share
(the "Class B Common Stock") are convertible into shares of Class A Common Stock
on a one-for-one basis at any time at the option of the holder. In addition,
shares of Class B Common Stock are automatically converted into Class A Common
Stock upon transfer to persons who are not Permitted Transferees (as this term
is defined in the Issuer's certificate of incorporation). Holders of Class A
Common Stock are entitled to one vote per share, and holders of Class B Common
Stock are entitled to ten votes per share.
See Item 5 for a statement of the direct holdings of each of the
Reporting Persons. Mr. Pagon and Pegasus Capital, Ltd. are deemed to be
beneficial owners of shares held of record by Pegasus Capital, L.P. because Mr.
Pagon owns 100% of the stock of Pegasus Capital, Ltd. which, in turn, is the
sole general partner of Pegasus Capital, L.P.
Because PNOC and PSOC are wholly-owned subsidiaries of PCH, the shares
held by them are deemed to be beneficially owned by PCH. Mr. Pagon, PCLP,
Northwest Management and Pegasus Cable are deemed to be the beneficial owners of
the shares held by PCH, PNOC and PSOC because Mr. Pagon owns 100% of the stock
of Pegasus Cable, which is the sole general partner in Northwest Management, and
because Northwest Management is the sole general partner in PCLP, which owns all
of the outstanding stock of PCH.
By reason of the Voting Agreement described in item 6, the Reporting
Persons share voting power over the shares of Class A Common Stock held by the
persons identified in item 6 and are deemed to be beneficial owners thereof.
Each of the Reporting Persons is engaged, through the Issuer and its
subsidiaries, in the media and communications business. The business address for
each of the Reporting Persons is the Bala Cynwyd Office. None of the Reporting
Persons has, during the last five years, been convicted of a criminal proceeding
(excluding traffic violations or similar misdemeanors) (a "Criminal Conviction")
or been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction resulting in a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to, Federal
or state securities laws or finding any violation with respect to such laws (a
"Civil Violation"). Mr. Pagon's principal employment is as President, Chief
Executive Officer, and Chairman of the Board of Directors of the Issuer. Mr.
Pagon also serves as an executive officer and a director of each of the Issuer's
subsidiaries, and as President, Chief Executive Officer, and sole director of
each of PCH, PNOC, PSOC, Pegasus Cable and Pegasus Capital, Ltd. (the "Corporate
Reporting Persons").
In addition to Mr. Pagon, Ted S. Lodge (the Issuer's Senior Vice
President, Chief Administrative Officer, General Counsel and Secretary), Howard
E. Verlin (the Issuer's Vice President and Assistant Secretary), and Kasin Smith
(the Issuer's Vice President and Chief financial Officer) serve as executive
officers of each of the Corporate Reporting Persons. Messrs. Lodge, Verlin and
Smith are collectively referred to herein as "Executive Officers." The principal
business address for each of the Executive Officers is the Bala Cynwyd Office,
and each of the Executive Officers is a citizen of the United States. None of
the Executive Officers has been subject to a Criminal Conviction or Civil
Violation.
-2-
<PAGE>
Item 3. Source and Amount of Funds or Other Consideration.
Not applicable.
Item 4. Purpose of Transaction.
Other than the Amended Voting Agreement described in item 6, neither
the Reporting Persons nor the Executive Officers have any present plans, or
contemplate any present proposals, that relate to or would result in any of the
transactions described in Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) As of May 5, 2000, the Reporting Persons and the Executive Officers are
deemed the beneficial owners in the aggregate of the number and
percentage of the Issuer's Class A Common Stock set forth below:
Shares of Class A
Name Common Stock % (1)
- ---- --------------- -----
Reporting Persons
Marshall W. Pagon (2)(3)(4)(5)(6) 8,146,151 30.3%
PCH (2)(3) 6,612,513 26.0%
PCLP (2)(3) 6,612,513 26.0%
Northwest Management (2)(3) 6,612,513 26.0%
Pegasus Cable (2)(3) 6,612,513 26.0%
PNOC (2) 3,370,229 15.2%
PSOC (2) 3,336,319 15.0%
Pegasus Capital, L.P. (2)(5) 4,465,309 19.2%
Pegasus Capital, Ltd. (2)(5) 4,465,309 19.2%
Executive Officers
Howard E. Verlin (7) 123,198 *
Ted S. Lodge (8) 116,699 *
Kasin Smith (9) 100 *
- -------
* Less than 1%.
-3-
<PAGE>
1. The percentage for each Reporting Person is calculated on the assumptions
that all shares of Class B Common Stock held directly or indirectly by the
particular Reporting Person, and only those shares, are converted into Class A
Common Stock, and that all other rights held by the particular Reporting Person
or Executive Officer to acquire Class A Common Stock, and only those rights, are
exercised.
2. Includes 3,247,961 shares of Class A Common Stock held by persons identified
in item 6 and deemed to be beneficially owned by this person solely by reason of
the Voting Agreement described in item 6.
3. Includes 3,123,856 shares of Class B Common Stock directly owned by PCH, and
122,338 and 118,358 shares of Class B Common Stock directly owned by its
wholly-owned subsidiaries, PNOC and PSOC, respectively. See item 2 for a
description of the relationship among these Reporting Persons.
4. Includes 202,774 shares of Class A Common Stock issuable upon exercise of the
vested portion of employee stock options.
5. Includes 1,217,348 shares of Class B Common Stock directly owned by Pegasus
Capital, L.P. See item 2 for a description of the relationship among these
Reporting Persons.
6. Includes 96,772 shares of Class A Common Stock held in the Issuer's 401(k)
plan, over which Mr. Pagon shares voting power in his capacity as a co-trustee.
7. Includes 71,500 shares of Class A Common Stock issuable upon exercise of the
vested portion of employee stock options.
8. Includes 109,770 shares of Class A Common Stock issuable upon exercise of the
vested portion of employee stock options. Also includes 1,500 shares owned by
Mr. Lodge's wife, of which he disclaims beneficial ownership.
9. Consists of shares of Class A Common Stock issuable upon exercise of the
vested portion of employee stock options.
(b) Because Mr. Pagon controls each of the other Reporting Persons, he and
the other Reporting Persons share the power to direct the vote and to
dispose of the shares of Class A Common Stock beneficially owned by the
Reporting Persons.
The Reporting Persons also share voting power over all shares
beneficially owned by them with the other parties to the Voting
Agreement described in item 6.
Each of the Executive Officers has the sole power to vote and dispose
of his shares, except that Mr. Lodge shares voting and dispositive
power over 5,079 shares of Class A Common Stock that he holds jointly
with his wife and disclaims beneficial ownership of 1,500 shares owned
by his wife.
-4-
<PAGE>
(c) The Reporting Persons and the Executive Officers have not effected any
transactions in the Issuer's securities in the last 60 days.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships With
Respect to Securities of the Issuer
On April 27, 1998, the Issuer acquired Digital Television Services,
Inc. ("DTS") and issued 5,471,296 shares of Class A Common Stock to the former
stockholders of DTS. In connection with that acquisition, the Issuer and the
Reporting Persons entered into a voting agreement dated April 27, 1998 (the
"Original Voting Agreement"), with Columbia Capital Corporation and Columbia
DBS, Inc. (collectively, "Columbia"), Whitney Equity Partners, L.P. ("Whitney"),
and Chisholm Partners III, L.P., Fleet Venture Resources, Inc., Fleet Equity
Partners VI, L.P., and Kennedy Plaza Partners (collectively, "Fleet"), all of
which are former stockholders of DTS. The Original Voting Agreement obligated
the parties to vote their shares of the Issuer's common stock to elect to the
Issuer's board of directors three persons designated by Mr. Pagon, one person
designated by Columbia, one person designated by Whitney, one person designated
by Fleet, and three Independent Directors (as defined in the Original Voting
Agreement). Since then, Columbia and Whitney have each sold a sufficient number
of their shares in the Issuer that they no longer have rights to designate
directors of the Issuer.
On May 5, 2000, the Issuer acquired Golden Sky Holdings, Inc. ("Golden
Sky") and issued 6,090,145 shares of Class A Common Stock to the former
stockholders of Golden Sky. In connection with that acquisition, the Issuer, the
Reporting Persons, and Fleet entered into an amended and restated voting
agreement dated May 5, 2000 (the "Amended Voting Agreement"), with Alta
Communications VI, L.P., Alta Subordinated Debt Partners III, L.P. and Alta-Comm
S By S LLC (collectively, "Alta"), and Spectrum Equity Investors L.P. and
Spectrum Equity Investors II, L.P. (collectively "Spectrum"). The Amended Voting
Agreement amended and restated the Original voting Agreement in its entirety.
The Amended Voting Agreement obligates the parties to vote their shares
of the Issuer's common stock to elect to the Issuer's board of directors four
persons designated by Mr. Pagon, one person designated by Fleet, one person
designated by Alta, and one person designated by Spectrum, with the rest of the
directors to be Independent Directors (as defined in the Amended Voting
Agreement). It also requires there to be audit, compensation and nominating
committees of the Issuer's board of directors, each consisting of one member
designated by Mr. Pagon, one member designated by a majority of the directors
designated by Fleet, Alta and Spectrum, and one member designated by a majority
of the Independent Directors. The Amended Voting Agreement is filed as an
exhibit to this amendment. Giving effect to the acquisition of Golden Sky, Fleet
owns directly 511,775 shares subject to the Amended Voting Agreement, Alta owns
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directly 1,525,881 shares subject to the Amended Voting Agreement, and Spectrum
owns directly 1,210,305 shares subject to the Amended Voting Agreement.
Pegasus Capital, L.P. has pledged 1,000,000 shares of Class B Common
Stock to CIBC, Inc. (as assignee of CIBC Oppenheimer Securities Corp.) as
security for a loan. PCH has pledged 350,000 shares of Class B Common Stock to
CIBC, Inc. as security for a loan. PNOC and PSOC have pledged 122,388 and
118,358 shares of Class B Common Stock, respectively, to an escrow agent to
secure certain deferred payment obligations.
Item 7. Material Filed as Exhibits.
1. Amended and Restated Voting Agreement dated May 5, 2000.
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<PAGE>
SIGNATURES
After reasonable inquiry and to the best of our knowledge and belief,
we certify that the information set forth in this statement is true, complete
and correct.
Dated: May 12, 2000
PEGASUS COMMUNICATIONS HOLDINGS, INC.
By: /s/ Marshall W. Pagon
-----------------------
Marshall W. Pagon,
President
PEGASUS NORTHWEST OFFER CORP.
By: /s/ Marshall W. Pagon
-----------------------
Marshall W. Pagon,
President
PEGASUS SCRANTON OFFER CORP.
By: /s/ Marshall W. Pagon
-----------------------
Marshall W. Pagon,
President
PEGASUS COMMUNICATIONS LIMITED PARTNERSHIP
By: NORTHWEST MANAGEMENT ASSOCIATES, L.P.
General Partner
By: PEGASUS CABLE ASSOCIATES, LTD.,
General Partner
By: /s/ Marshall W. Pagon
---------------------
Marshall W. Pagon,
President
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<PAGE>
NORTHWEST MANAGEMENT ASSOCIATES, L.P.
By: PEGASUS CABLE ASSOCIATES, LTD.,
General Partner
By: /s/ Marshall W. Pagon
------------------------
Marshall W. Pagon,
resident
PEGASUS CABLE ASSOCIATES, LTD.
By: /s/ Marshall W. Pagon
------------------------
Marshall W. Pagon,
President
PEGASUS CAPITAL, L.P.
By: PEGASUS CAPITAL, LTD.,
General Partner
By: /s/ Marshall W. Pagon
------------------------
Marshall W. Pagon,
President
PEGASUS CAPITAL, LTD.
By: /s/ Marshall W. Pagon
------------------------
Marshall W. Pagon,
President
/s/ Marshall W. Pagon
------------------------
Marshall W. Pagon
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<PAGE>
AMENDED AND RESTATED VOTING AGREEMENT, dated May 5, 2000, among PEGASUS
COMMUNICATIONS CORPORATION, a Delaware corporation (the "Company"); FLEET
VENTURE RESOURCES, INC., a Rhode Island corporation, FLEET EQUITY PARTNERS VI,
L.P., a Delaware limited partnership, CHISHOLM PARTNERS III, L.P., a Delaware
limited partnership, and KENNEDY PLAZA PARTNERS, a Rhode Island general
partnership; SPECTRUM EQUITY INVESTORS, L.P. and SPECTRUM EQUITY INVESTORS II,
L.P. (each a Delaware limited partnership and together referred to herein as
"Spectrum"), ALTA COMMUNICATIONS VI, L.P., a Delaware limited partnership, ALTA
SUBORDINATED DEBT PARTNERS III, L.P., a Delaware limited partnership and
ALTA-COMM S BY S, LLC, a Massachusetts limited liability company (together
referred to herein as "Alta"); and PEGASUS COMMUNICATIONS HOLDINGS, INC., a
Delaware corporation, PEGASUS CAPITAL, L.P., a Pennsylvania limited partnership,
PEGASUS SCRANTON OFFER CORP, a Delaware corporation, PEGASUS NORTHWEST OFFER
CORP, a Delaware corporation, and MARSHALL W. PAGON, an individual.
The Company, Pegasus DTS Merger Sub, Inc., a Delaware corporation ("DTS
Merger Sub"), Digital Television Services, Inc., a Delaware corporation ("DTS"),
and certain shareholders of the Company and of DTS are parties to an Agreement
and Plan of Merger dated January 8, 1998 (the "DTS Merger Agreement"). At the
closing held on April 28, 1998, under the DTS Merger Agreement, (1) DTS Merger
Sub was merged with and into DTS, (2) DTS thereby became a wholly-owned
subsidiary of the Company, (3) the Fleet Parties (this and certain other terms
are defined in Section 1) received shares of Class A Common Stock as the DTS
Merger Consideration, and (4) the Company, the Pegasus Parties, the Fleet
Parties, and Whitney Equity Partners, L.P., a Delaware limited partnership
("Whitney"), Columbia Capital Corporation, Virginia corporation ("Columbia
Capital"), and Columbia DBS, Inc. a Virginia corporation, entered into a Voting
Agreement dated April 27, 1998 (the "Original Voting Agreement"). Whitney and
Columbia Capital no longer have the right to designate a director of the
Company, pursuant to Section 4.1(b)(1) and Section 4.1(a)(1) of the Original
Voting Agreement.
The Company, Pegasus GSS Merger Sub, Inc., a Delaware corporation ("GSS
Merger Sub"), Golden Sky Holdings, Inc., a Delaware corporation ("GSS"), and
certain shareholders of the Company and GSS (including Spectrum and Alta) are
parties to an Agreement and Plan of Merger dated January 10, 2000, as amended
January 25, 2000 (the "GSS Merger Agreement").
At the Closing held today under the GSS Merger Agreement, (1) GSS
Merger Sub is being merged with and into GSS, (2) GSS is thereby becoming a
wholly-owned subsidiary of the Company, and (3) Spectrum and Alta are receiving
shares of Class A Common Stock. It is a condition precedent to the Closing that
the parties hereto execute and deliver this Agreement.
PCH, PCLP, PSOC and PNOC hold all the issued and outstanding shares of
Class B Common Stock. Pagon controls PCH, PCLP, PSOC and PNOC.
<PAGE>
NOW, THEREFORE, in consideration of the completion of the transactions
contemplated by the DTS Merger Agreement and the GSS Merger Agreement and of the
mutual covenants contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound, the parties amend and restate the Original Voting
Agreement, effective the date first written above, to read as follows.
SECTION 1
DEFINITIONS
1.1 Definitions. As used in this Agreement, the following terms have
the following terms have the following meanings:
"Alta": as defined in the recitals.
"Alta Designee": a person designated by Alta to serve as a
director in accordance with this Agreement.
"Audit Committee": the audit committee of the Board of Directors
referred to in Section 3.4.
"Board of Directors": the board of directors of the Company.
"Chisholm": Chisholm Partners III, L.P., a Delaware limited
partnership.
"Chisholm Designee": a person designated by Chisholm to serve as
a director in accordance with this Agreement.
"Class A Common Stock": the Company's Class A Common Stock, par
value $0.01 per share.
"Class B Common Stock": the Company's Class B Common Stock, par
value $0.01 per share.
"Committee": the Audit Committee, the Compensation Committee or
the Nominating Committee.
"Compensation Committee": the compensation committee of the
Board of Directors referred to in Section 3.4.
"Covered Shares": (a) the shares of Class A Common Stock
received as the DTS Merger Consideration by the shareholders of DTS that are
parties to this Agreement; (b) the shares of Class A Common Stock received as
the GSS Merger Consideration by Spectrum and Alta; and (c) all shares of voting
<PAGE>
securities of the Company now or hereafter beneficially owned (within the
meaning of the Securities Exchange Act of 1934) by PCH, PCLP, PSOC, PNOC or
Pagon.
"Designation Right Loss Event": With respect to any person, any
of the following, as determined by a majority of the Independent Directors
(whose determination shall be conclusive):
(a) such person's designee as a director commits a breach of
fiduciary duty to the Company or a material violation of any federal or
state securities law in connection with the purchase or sale of any of
the Company's securities;
(b) such person commits a material violation of any federal or
state securities law in connection with the purchase or sale of any of
the Company's securities;
(c) in the case of the Fleet Parties, any such person materially
breaches its confidentiality agreement with the Company;
(d) such person shall own, control, manage or be financially
interested, directly or indirectly, in any business (other than a less
than 5% interest in a publicly held company) that competes with the
Company or any of its Subsidiaries in any geographic area in which the
Company does business; but this paragraph (d) shall not apply (1) to
any investment held on November 5, 1997, by any of the Fleet Parties or
their Affiliates or any investment held on January 10, 2000, by any of
the GSS Parties or their respective Affiliates, (2) to any investment
in a business that comes into competition with the Company or any of
its Subsidiaries as a result of the Company's acquisition or
establishment of a new business or its expansion into a geographic area
in which it did not previously operate if such person shall have held
such investment before the Company's management proposes to the Board
of Directors such acquisition, establishment or expansion, (3) to any
investment in an investment fund or pool that itself makes or holds an
investment in a competitive business if such person (A) is regularly
engaged in making investment of that kind and (B) does not have the
power to, and does not in fact, exercise an influence on the decision
of the fund or pool in making the investment in the competitive
business, and (4) unless prior to the exercise by a majority of the
Independent Directors of the right to terminate the relevant person's
right to designate a director, such person is given notice of the
potential applicability of this paragraph (d) and fails to cure or
modify the relationship to the satisfaction of a majority of the
Independent Directors within 30 days after the notice is given;
provided, however, that in no event shall this subsection (d) apply to
any Person associated with, related to, affiliated with, controlled by,
controlling or under common control with, Alta or Spectrum other than
Spectrum Equity Investors II, L.P., Spectrum Equity Investors, L.P.,
Alta Communications VI, L.P., Alta Subordinated Debt Partners III, L.P.
and Alta-Comm S by S, LLC;
(e) such person shall violate Section 2; or
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(f) any director designated by such person shall take or omit to
take any action in his capacity as a director or Committee member in a
manner materially inconsistent with this Agreement, and the Person who
has the right to designate such director has not obtained such
director's resignation as a director within 30 days after being
requested to do so by the Board of Directors.
"Director" or "director": a member of the Board of Directors.
"DTS": as defined in the recitals.
"DTS Merger Agreement": as defined in the recitals.
"DTS Merger Consideration": the "Merger Consideration" as
defined in the DTS Merger Agreement.
"Fleet Parties": Chisholm, Fleet Venture Resources, Inc., a
Rhode Island corporation, Fleet Equity Partners VI, L.P., a Delaware limited
partnership, and Kennedy Plaza Partners, a Rhode Island general partnership.
"GSS": as defined in the recitals.
"GSS Designee": a Spectrum Designee or an Alta Designee.
"GSS Merger Agreement": as defined in the recitals.
"GSS Merger Consideration": the "Merger Consideration" as
defined in the GSS Merger Agreement.
"GSS Parties": Spectrum and Alta.
"Independent Director": a natural person who (a) is not Marshall
W. Pagon or an officer, employee or principal of the Company, PCH, PCLP, PSOC,
PNOC, any of the Fleet Parties, DTS, Spectrum, Alta, GSS, or any of their
subsidiaries or affiliates, or any spouse or sibling, or any ancestor or lineal
descendant of any such person, spouse or sibling ("immediate family"), (b) is
not a former officer or employee of any such person, (c) does not in addition to
such person's role as a director, act on a regular basis, either individually or
as a member or representative of an organization, serving as a professional
adviser, legal counsel or consultant to any such person, if, in the reasonable
discretion of the Nominating Committee, such relationship is material to any
such person, and (d) does not represent, and is not a member of the immediate
family of, a person who would not satisfy the requirements of the preceding
clauses (a), (b) and (c) of this sentence. A person who has been or is a
partner, officer or director of an organization that has customary commercial,
industrial, banking or underwriting relationships with any of the persons named
in clause (a) of the preceding sentence that are carried on in the ordinary
course of business and on an arms-length basis and who otherwise satisfies the
requirements set forth in clauses (a), (b), (c) and (d) of the first sentence of
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<PAGE>
this definition, may qualify as a Independent Director unless, in the reasonable
discretion of the Nominating Committee, such person is not independent or may
not be independent with respect to the management of the business and affairs of
the Company. A person shall not be disqualified as an Independent Director under
clause (b), (c) or (d) above solely because of such person's (or a member of
such person's immediate family's) having served in any capacity with a business
(other than DTS or GSS) acquired by the Company, or solely because such person
is a representative or designee of any such business (whether or not the Company
shall enter into a consulting agreement with such person in connection with such
acquisition).
"Pagon": Marshall W. Pagon, an individual.
"Pagon Designee": a person designated by Pagon (or, in the event
of his death or incapacity, by PCLP or another person appointed by Pagon for
this purpose) to serve as a director in accordance with this Agreement.
"PCH": Pegasus Communications Holdings, Inc., a Delaware
corporation.
"PCLP": Pegasus Capital, L.P., a Pennsylvania limited
partnership.
"PNOC": Pegasus Northwest Offer Corp, a Delaware corporation.
"PSOC": Pegasus Scranton Offer Corp, a Delaware corporation.
"Permitted Transferee": as defined in the Company's certificate
of incorporation on the date hereof.
"Person" or "person": an individual, a partnership (general or
limited), corporation, limited liability company, joint venture, business trust,
cooperative, association or other form of business organization, whether or not
regarded as a legal entity under applicable law, a trust (inter vivos or
testamentary), an estate of a deceased, insane or incompetent person, a
quasi-governmental entity, a government or any agency, authority, political
subdivision or other instrumentality thereof, or any other entity.
"Spectrum": as defined in the recitals.
"Spectrum Designee": a person designated by Spectrum to serve as
a director in accordance with this Agreement.
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SECTION 2
VOTING
Section 2.1 Each party warrants to the others that, as of the date of
this Agreement, it has voting control over the number of Covered Shares set
forth opposite its name on Exhibit A. Each party shall vote all Covered Shares
held by it, or over which it has the power to direct the voting, as specified in
this Agreement and shall take any and all other action necessary or appropriate
to implement the provisions of this Agreement, including without limitation
proposing and voting on amendments to the Company's certificate of incorporation
and by-laws as may be necessary to fully implement the provisions hereof. No
party shall permit any Covered Shares held by it, or over which it has the power
to direct the voting, to be voted in any manner inconsistent with this
Agreement. "Voting" includes the execution of written consents.
SECTION 3
COMPOSITION OF BOARD OF DIRECTORS
AND COMMITTEES
Section 3.1 Board of Directors. Except as otherwise provided in Section
3.3, the Board of Directors shall consist of eleven members, of whom:
(a) four will be Pagon Designees;
(b) one will be a Chisholm Designee until Chisholm ceases to
have the right to designate a director under Section 4.1(b);
(c) one will be a Spectrum Designee until Spectrum ceases to
have the right to designate a director under Section 4.1(c);
(d) one will be an Alta Designee until Alta ceases to have the
right to designate a director under Section 4.1(d); and
(e) all directors other than the Pagon Designees, the Chisholm
Designee, the Alta Designee and the Spectrum Designee will be
Independent Directors, who shall be the persons identified in Section
3.5(e) (so long as they continue to satisfy the definition of
"Independent Director") or their successors (who satisfy the definition
of "Independent Director") nominated by the Nominating Committee.
Section 2.1 shall apply to the election of directors specified in this Section
3.1.
Section 3.2 Vacancies Caused by Resignation, etc. of Designated
Directors. Any vacancy in the Board of Directors or a Committee caused by the
resignation, removal, incapacity or death of a Pagon Designee, a Chisholm
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Designee or a GSS Designee shall be filled by a person designated by the party
that had the right to designate the resigned, removed, incapacitated or dead
director or Committee member, except as provided in Section 3.3. Section 2.1
shall apply to the election of directors and Committee members specified in this
Section 3.2.
Section 3.3 Other Vacancies.
(a) If Chisholm, Spectrum or Alta ceases to have the right to
designate a director pursuant to Section 4.1, such party shall promptly cause
the director designated by it to resign if so requested by Pagon (or, in the
event of his death or incapacity, by PCLP or another person appointed for Pagon
for this purpose), except that in case of the loss pursuant to Section 4.1(a)(1)
or of the right of Chisholm to designate a director, as the case may be, which
also results in the termination of this Agreement pursuant to Section 4.3, such
party shall cause the director designated by it to resign not later than the
date on which this Agreement terminates.
(b) Failing any resignation required by subsection (a), the
affected director or directors may be removed in the manner provided by law.
(c) If a vacancy occurs in the Board of Directors by reason of
any required resignation or permitted removal described in subsection (a) or
(b), the Board of Directors (as constituted after giving effect to such vacancy)
shall either (1) reduce the number of directors to eliminate the vacancy or (2)
instruct the Nominating Committee to nominate an Independent Director to fill
the vacancy.
(d) The size of the Board of Directors may be increased as
provided by law. Each director elected to fill any position created by an
increase in the size of the Board of Directors shall be an Independent Director.
(e) No party to this Agreement will take any action to fill a
vacancy created under this Section 3.3 by a person who is not an Independent
Director. Otherwise, Section 2.1 shall not apply to the election of directors to
fill vacancies created under this Section 3.3.
Section 3.4 Committees. The existence of the Audit Committee, the
Nominating Committee and the Compensation Committee shall continue. Subject to
any requirement of law or regulation or of any securities exchange or
interdealer quotation system on or in which securities of the Company are listed
or traded, each Committee shall consist of three directors who shall be (1) a
director designated by Pagon, (2) a director designated by a majority of the
Chisholm Designees and GSS Designees then serving as directors; and (3) one of
the Independent Directors specified in Section 3.1(e) designated by the Board of
Directors in the manner provided by law. The Audit Committee and the
Compensation Committee shall have the powers and functions of the present audit
committee and compensation committee of the Board of Directors, subject to any
requirement of law or regulation or of any securities exchange or interdealer
quotation system on or in which securities of the Company are listed or traded.
The Nominating Committee shall nominate all persons (other than the Pagon
Designees, the Chisholm Designee and the GSS Designees) to serve as directors,
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which nominee shall be subject to election by the shareholders of the Company or
subject to appointment by the Board of Directors to fill vacancies. The Company
shall not establish a committee with the authority to act on all or
substantially all matters on which the Board of Directors may act (commonly
known as an "executive committee") without the consent of a majority of the
Chisholm Designee and the GSS Designees as a single group.
Section 3.5 Initial Designations. The parties make the following
designations pursuant to this Section 3:
(a) The Pagon Designees are Pagon, Robert N. Verdecchio, Ted S.
Lodge and Harry F. Hopper, III.
(b) The Chisholm Designee is Riordon B. Smith.
(c) The Spectrum Designee is William P. Collatos.
(d) The Alta Designee is Robert F. Benbow.
(e) The Independent Directors specified in Section 3.1(f) are
James J. McEntee, III, Mary C. Metzer, William P. Phoenix and Donald W.
Weber, each of whom is currently a director of the Company.
Immediately following the execution of this Agreement, the Board of Directors
shall take such action as shall be required to create vacancies on the Board of
Directors and to elect persons to the Board of Directors as specified in this
Section 3.5. The parties will make their designations to the Committees at a
later date.
Section 3.6 Subsequent Designations. Except as provided in Section 3.5,
each party to this Agreement that is entitled to designate one or more directors
or Committee members shall do so by written notice to each of the other parties
to this Agreement and to the Secretary of the Company, signed by the Person
making such designation.
Section 3.7 Removal. Any director may be removed by the shareholders of
the Company in the manner provided by law, except that no Chisholm Designee or
GSS Designee may be removed without the written consent of the party that
designated him unless such party shall have ceased to have the right to
designate a director pursuant to Section 4.1. Section 2.1 shall apply to this
Section 3.7.
Section 3.8 Chairman, President and Chief Executive Officer. For so
long as this Agreement is in effect, Pagon will be elected by the Board of
Directors as Chairman, President and Chief Executive Officer of the Company,
except in case of incapacity.
Section 3.9 Separate Voting Rights of Other Classes of Stock. If the
holders of any class of the Company's preferred stock shall become entitled to
elect directors in accordance with the terms of such preferred stock, this
Agreement shall not apply to any additional directorships to which their rights
apply.
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Section 3.10 Failure or Delay in Making Designations. No failure or
delay by any party in making any designation of a director or Committee member
shall constitute a waiver of such party's right to make designations in the
future.
SECTION 4
TERMINATION
Section 4.1 Termination of Designation Rights.
(a) Chisholm shall cease to have the right to designate a
director if at any time (1) the Fleet Parties collectively own less than half
the Covered Shares received by them pursuant to the DTS Merger Agreement, or (2)
a Designation Right Loss Event occurs with respect to any Fleet Party.
(b) Spectrum shall cease to have the right to designate a
director if at any time (1) Spectrum owns less than half the Covered Shares
received by Spectrum pursuant to the GSS Merger Agreement, or (2) a Designation
Right Loss Event occurs with respect to Spectrum.
(c) Alta shall cease to have the right to designate a director
if at any time (1) Alta owns less than half the Covered Shares received by Alta
pursuant to the GSS Merger Agreement, or (2) a Designation Right Loss Event
occurs with respect to Alta.
(d) For purposes of this Section 4.1, a party no longer owns
shares of Class A Common Stock distributed to its equity holders unless the
distributee is also a party to this Agreement on the date hereof. Continuing
ownership of Covered Shares shall be determined by the specific identification
method.
(e) At the Company's request from time to time, Chisholm,
Spectrum and Alta shall certify (and Chisholm shall cause the Fleet Parties to
certify) to the Company in writing, the number of shares of Class A Common Stock
received as part of the DTS Merger Consideration or the GSS Merger
Consideration, as the case may be, that each such person continues to own. If
requested by the Company, each such person will provide the Company with
evidence reasonably substantiating such person's continuing ownership of such
shares. If any such person fails to deliver such certification or evidence to
the Company within ten days after the Company delivers its written request
therefor to Chisholm, Spectrum or Alta, such person shall be deemed for all
purposes of this Agreement not to own any such shares of Class A Common Stock.
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Section 4.2 Termination of Voting Obligations.
(a) The obligations of any party under Section 2.1 shall
terminate with respect to any Covered Share upon the sale or other transfer of
such Covered Share to any person who is not a party to this Agreement and is not
required by subsection (b) to become a party to this Agreement.
(b) PCH, PCLP, PSOC or PNOC shall not sell or otherwise
transfer any Covered Shares to a Permitted Transferee unless the Permitted
Transferee agrees in writing to be bound by, and to become a party to, this
Agreement (including the requirements of this subsection) to the same extent as
its transferor, as it relates to the Covered Shares so transferred.
(c) The obligations of Spectrum and Alta under Section 2.1
shall terminate upon the resignation of the Spectrum Designee or the Alta
Designee, as the case may be, from the Board of Directors, provided that the
vacancy caused thereby is not filled by Spectrum or Alta, as the case may be,
pursuant to Section 3.2 within five days of such resignation.
Section 4.3 Termination of Agreement. This Agreement shall terminate as
to each of Chisholm, Spectrum and Alta as of the date that such party ceases to
have the right to designate a Director pursuant to Section 4.1. This Agreement
shall terminate in its entirety on the later of (1) the date of the meeting of
the Company's shareholders at which directors are scheduled to be elected next
following the date on which Chisholm shall cease to have the right to designate
a director pursuant to Section 4.1, or (2) the last date on which either
Spectrum or Alta has the right to designate a director pursuant to Section 4.1.
Neither Section 2 nor the requirements of this Agreement relating to actions by
the Nominating Committee shall apply to the election of directors to occur at
such meeting.
SECTION 5
MISCELLANEOUS
Section 5.1 Notices. Except as otherwise provided below, whenever it is
provided in this Agreement that any notice, demand, request, consent, approval,
declaration or other communication shall or may be given to or served upon any
of the parties hereto, or whenever any of the parties hereto, wishes to provide
to or serve upon the other party any other communication with respect to this
Agreement, each such notice, demand, request, consent, approval, declaration or
other communication shall be in writing and shall be delivered in person or sent
by telecopy, as specified in the DTS Merger Agreement or the GSS Merger
Agreement, as the case may be.
Section 5.2 Entire Agreement. This Agreement represents the entire
agreement and understanding among the parties hereto with respect to the subject
matter hereof and supersedes any and all prior oral and written agreements,
arrangements and understandings among the parties hereto with respect to such
subject matter; and this Agreement can be amended, supplemented or changed, and
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any provision hereof can be waived or a departure from any provision hereof can
be consented to, only by a written instrument making specific reference to this
Agreement signed by all parties to this Agreement other than (a) the Fleet
Parties if Chisholm shall no longer have the right to designate a director
pursuant to Section 4.1, (b) Spectrum if Spectrum shall no longer have the right
to designate any director pursuant to Section 4.1, or (c) Alta if Alta shall no
longer have the right to designate any director pursuant to Section 4.1.
Section 5.3 Paragraph Headings. The paragraph headings contained in
this Agreement are for general reference purposes only and shall not affect in
any manner the meaning, interpretation or construction of the terms or other
provisions of this Agreement.
Section 5.4 Applicable Law. This Agreement shall be governed by,
construed and enforced in accordance with the laws of Delaware applicable to
contracts to be made, executed, delivered and performed wholly within such state
and, in any case, without regard to the conflicts of law principles of such
state.
Section 5.5 Severability. If any provision of this Agreement shall be
held by any court of competent jurisdiction to be illegal, void or
unenforceable, such provision shall be of no force and effect, but the
illegality or unenforceability of such provision shall have no effect upon and
shall not impair the enforceability of any other provision of this Agreement.
Section 5.6 No Waiver. The failure of any party at any time or times to
require performance of any provision hereof shall not affect the right at a
later time to enforce the same. No waiver by any party of any condition, and no
breach of any provision, term, covenant, representation or warranty contained in
this Agreement, whether by conduct or otherwise, in any one or more instances,
shall be deemed to be construed as a further or continuing waiver of any such
condition or of the breach of any other provision, term, covenant,
representation or warranty of this Agreement.
Section 5.7 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute but one and the same original instrument. Not all
parties need sign the same counterpart. Delivery by facsimile of a signature
page to this Agreement shall have the same effect as delivery of an original
executed counterpart.
-11-
<PAGE>
Section 5.8 Successors and Assigns. Subject to Section 4.1(d), this
Agreement shall inure to the benefit of and be binding upon the successors,
assigns and transferees of each of the parties.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed the date first written above.
PEGASUS COMMUNICATIONS CORPORATION
By: /s/ Ted S. Lodge
----------------------------------------
Ted S. Lodge,
Senior Vice President
PEGASUS CAPITAL, L.P.
By: Pegasus Capital, Ltd., General Partner
By: /s/ Ted S. Lodge
----------------------------------------
Ted S. Lodge,
Senior Vice President
PEGASUS COMMUNICATIONS HOLDINGS, INC.
By: /s/ Ted S. Lodge
----------------------------------------
Ted S. Lodge,
Senior Vice President
PEGASUS SCRANTON OFFER CORP.
By: /s/ Ted S. Lodge
----------------------------------------
Ted S. Lodge,
Senior Vice President
PEGASUS NORTHWEST OFFER CORP.
By: /s/ Ted S. Lodge
----------------------------------------
Ted S. Lodge,
Senior Vice President
/s/ Marshall W. Pagon
----------------------------------------
Marshall W. Pagon
-12-
<PAGE>
FLEET VENTURE RESOURCES, INC.
By: /s/ Riordon B. Smith
----------------------------------------
Riordon B. Smith
Senior Vice President
FLEET EQUITY PARTNERS VI, L.P.
By: Fleet Growth Resources II, Inc.
Its General Partner
By: /s/ Riordon B. Smith
----------------------------------------
Riordon B. Smith
Senior Vice President
CHISHOLM PARTNERS III, L.P.
By: Silverado III L.P., its general partner
By: Silverado III Corp., its general partner
By: /s/ Riordon B. Smith
----------------------------------------
Riordon B. Smith
Senior Vice President
KENNEDY PLAZA PARTNERS
By: /s/ Riordon B. Smith
----------------------------------------
Riordon B. Smith
Senior Vice President
-13-
<PAGE>
SPECTRUM EQUITY INVESTORS, L.P.
By: Spectrum Equity Associates, L.P.,
its general partner
By: /s/ William P. Collatos
----------------------------------------
William P. Collatos
General Partner
SPECTRUM EQUITY INVESTORS II, L.P.
By: Spectrum Equity Associates II, L.P.,
its general partner
By: /s/ William P. Collatos
----------------------------------------
William P. Collatos
General Partner
ALTA COMMUNICATIONS VI, L.P.
By: Alta Communications VI Management
Partners, L.P., its general partner
By: /s/ Eileen McCarthy
----------------------------------------
Eileen McCarthy
General Partner
-14-
<PAGE>
ALTA SUBORDINATED DEBT PARTNERS III, L.P.
By: Alta Subordinated Debt Management
Partners, L.P., its general partner
By: /s/ Eileen McCarthy
----------------------------------------
Eileen McCarthy
General Partner
ALTA-COMM S BY S, LLC
By: /s/ Eileen McCarthy
----------------------------------------
Eileen McCarthy
Member
<PAGE>
EXHIBIT A
<TABLE>
<CAPTION>
Covered Shares
--------------------------------------------------
Shareholder Class A Common Stock Class B Common Stock
- ----------- -------------------- --------------------
<S> <C> <C>
Fleet Venture Resources, Inc. 276,853
Fleet Equity Partners VI, L.P. 118,593
Chisholm Partners III, L.P. 100,584
Kennedy Plaza Partners 6,745
Spectrum Equity Partners, L.P. 404,183.808
Spectrum Equity Partners II, L.P. 806,122.071
Alta Communications VI, L.P. 939,589.271
Alta Subordinated Debt Partners III, L.P. 564,892.104
Alta-Comm S By S LLC 21,400.058
Pegasus Capital, L.P. 1,217,348
Pegasus Communications Holdings, Inc. 3,123,856
Pegasus Northwest Offer Corp. 122,338
Pegasus Scranton Offer Corp. 118,358
Marshall W. Pagon 15,863
</TABLE>
