SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)
CDnow, Inc.
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(Name of Issuer)
Common Stock, without par value
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(Title of Class of Securities)
125085100
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(CUSIP Number)
Christopher P. Bogart, Esq.
General Counsel
Time Warner Inc.
75 Rockefeller Plaza
New York, NY 10019
(212) 484-8000
with copies to:
Faiza J. Saeed, Esq. Robert Schumer, Esq.
Cravath, Swaine & Moore Paul, Weiss, Rifkind, Wharton & Garrison
825 Eighth Avenue 1285 Avenue of the Americas
New York, New York 10019 New York, New York 10019
(212) 474-1454 (212) 373-3097
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
August 3, 2000
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule 13D, and
is filing this schedule because of Section 240.13d-1(e), 240.13d-1(f) or
240.13d-1(g), check the following box [ ].
Note: Schedules filed in paper format shall include a signed
original and five copies of the schedule, including all exhibits.
See Section 240.13d-7(b) for other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to the subject
class of securities, and for any subsequent amendment containing information
which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall
not be deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Act"), or otherwise subject to the
liabilities of that section of the Act but shall be subject to all other
provisions of the Act (however, see the Notes).
<PAGE>
CUSIP No. 125085100
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1 Names of Reporting Persons
I.R.S. Identification Nos. of Above Persons (entities only)
TIME WARNER INC.
I.R.S. No.: 13-3527249
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2 Check the Appropriate Box if a Member of a Group
(See Instructions) (a)[ ]
(b)[ ]
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3 SEC Use Only
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4 Source of Funds (See Instructions)
WC
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5 Check if Disclosure of Legal Proceedings is Required
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Pursuant to Items 2(d) or 2(e) [ ]
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6 Citizenship or Place of Organization
Delaware
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7 Sole Voting Power
Number of 0
Shares ----------------------------------------------
Beneficially 8 Shared Voting Power
Owned by Each 1,202,750
Reporting ----------------------------------------------
Person With 9 Sole Dispositive Power
0
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10 Shared Dispositive Power
1,202,750
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11 Aggregate Amount Beneficially Owned by Each Reporting Person
1,202,750
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12 Check Box if the Aggregate Amount in Row (11) Excludes
Certain Shares (See Instructions) [ ]
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Percent of Class Represented
13 by Amount in Row (11)
3.7%
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14 Type of Reporting Person (See Instructions)
CO, HC
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<PAGE>
CUSIP No. 125085100
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1 Names of Reporting Persons
I.R.S. Identification Nos. of Above Persons (entities only)
TWI CDNOW HOLDINGS INC.
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2 Check the Appropriate Box if a Member of a Group
(See Instructions) (a)[ ]
(b)[ ]
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3 SEC Use Only
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4 Source of Funds (See Instructions)
AF
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5 Check if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(e) [ ]
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6 Citizenship or Place of Organization
New York
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7 Sole Voting Power
Number of 0
Shares ------------------------------------------------
Beneficially 8 Shared Voting Power
Owned by Each 1,202,750
Reporting ------------------------------------------------
Person With 9 Sole Dispositive Power
0
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10 Shared Dispositive Power
1,202,750
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11 Aggregate Amount Beneficially Owned by Each Reporting Person
1,202,750
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12 Check Box if the Aggregate Amount in Row (11) Excludes
Certain Shares (See Instructions) [ ]
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Percent of Class Represented
13 by Amount in Row (11)
3.7%
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14 Type of Reporting Person (See Instructions)
CO
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3
<PAGE>
This Amendment No. 1 (this "Amendment") hereby amends and
supplements the Statement on Schedule 13D (the "Initial Statement") filed by
Time Warner Inc. ("Time Warner") and TWI CDNow Holdings Inc. ("TWI CDNow
Holdings") (collectively, the "Reporting Persons"), relating to the common
stock (the "Common Stock") of CDnow, Inc. ("CDnow"). Capitalized terms used
herein but not defined herein have the meanings ascribed to them in the
Initial Statement.
Item 4. Purpose of Transaction
Item 4 of the Initial Statement is amended and restated in its
entirety as follows:
As of August 3, 2000, Time Warner and TWI CDNow Holdings are the
beneficial owners of less than five percent of the outstanding CDnow Common
Stock and therefore intend to make no further filings pursuant to Rule 13d-1
promulgated under the Securities Exchange Act of 1934, as amended, until such
time as either the Time Warner or TWI CDNow Holdings ownership of the CDnow
Common Stock rises to a level above five percent of the outstanding CDnow
Common Stock.
Item 5. Interest in Securities of the Issuer
Item 5 of the Initial Statement is amended and restated in its
entirety as follows:
On August 3, 2000, CDnow prepaid all amounts due and outstanding
under a convertible loan agreement (the "Convertible Loan Agreement"), between
CDnow, Time Warner and Sony Music Entertainment Inc. ("Sony Music"). Under the
Convertible Loan Agreement, each of Time Warner and Sony Music, as lenders,
had agreed to make term loans to CDnow, as borrower, in an amount not to
exceed the loan commitment under the Convertible Loan Agreement. Each of Time
Warner and Sony Music, at its sole option, at any time and from time to time,
had the right to convert (the "Conversion Right") all outstanding loans made
by it under the Convertible Loan Agreement, and any accrued and unpaid
interest on the loans, into shares of CDnow Common Stock, at a conversion
price of $10.00 per share (subject to customary anti- dilution adjustments).
At the time of the filing of the Initial Statement on Schedule 13D, assuming
that Time Warner had made loans to CDnow in the full amount of its loan
commitment, based on the conversion price, Time Warner would have had the
right, pursuant to the Conversion Right, to acquire beneficial ownership of
1,500,000 shares of CDnow Common Stock. Time Warner's Conversion Right
terminated upon CDnow's prepayment of Time Warner's loan under the Convertible
Loan Agreement. As a result Time Warner is no longer deemed to beneficially
own shares of CDnow Common Stock under the Convertible Loan Agreement, and is
no longer the beneficial owner of more than 5% of the outstanding CDnow Common
Stock.
TWI CDNow Holdings beneficially owns 1,202,750 shares of CDnow
Common Stock, representing less than 5% of the outstanding shares of CDnow
Common Stock. Time Warner is deemed to beneficially own 1,202,750 shares of
CDnow Common Stock, representing less than 5% of the outstanding shares of
CDnow Common Stock, held by TWI CDNow Holdings. Time Warner and TWI CDNow
Holdings may be deemed to share the power to vote, and the power to dispose of
1,202,750 shares of CDnow Common Stock owned by TWI CDNow Holdings.
Except as described herein, none of the Reporting Persons, nor, to
the best knowledge of the Reporting Persons, any person listed in Annex A or
Annex B of the Initial Statement, as appropriate, beneficially owns, or has
acquired or disposed of, any shares of CDnow Common Stock during the past 60
days.
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<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: August 8, 2000
TIME WARNER INC.,
by: /s/ Spencer B. Hays
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Name: Spencer B. Hays
Title: Vice President
TWI CDNOW HOLDINGS INC.,
by: /s/ Spencer B. Hays
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Name: Spencer B. Hays
Title: Vice President
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