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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) April 5, 1995
Park Communications, Inc.
Exact name of registrant as specified in its charter)
Delaware 0-12743 16-0986694
(State or other (Commission File Number) (IRS Employer
jurisdiction Identification
of incorporation) No.)
Terrace Hill, Ithaca, N.Y. 14850
(Address of principal executive offices)
Registrant's telephone number, including area code: 607-272-9020
N/A
(Former name or former address, if changed since last report)<PAGE>
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Item 5. Other Events.
Set forth below is the text of a press release issued by the
Registrant on April 5, 1995, reporting an unofficial announcement by the
Federal Communications Commission (the "FCC") regarding its consent to the
transfer of control of the Registrant and its broadcast licensee
subsidiaries to Park Acquisitions, Inc. ("PAI") in connection with the sale
of the Company to PAI for approximately $711.4 million. On Monday, April
10, 1995, the FCC released its order, a copy of which is attached as an
exhibit hereto and is incorporated herein by reference.
"On Wednesday, April 5, 1995, the Federal Communications Commission
issued an unofficial announcement of Commission action consenting to
the transfer of control of licenses held by Park Communications, Inc.
to Park Acquisitions, Inc. in connection with the sale of 100 percent
of the stock of the Company to Park Acquisitions, Inc. for
approximately $711.4 million. Release of the Commission's formal
order is expected shortly. Under the terms of the sale agreement, the
order will become final thirty days after the date of release, absent
a decision by the FCC to reconsider the order or an appeal of the
order to the United States Court of Appeals.
The sale of Park Communications, Inc. is also contingent upon approval
of the transaction by the holders of at least 66 percent of the
Company's issued and outstanding common stock. The estate of the
company's founder and former chairman and chief executive officer, Roy
H. Park, which currently owns or controls approximately 80.1 percent
of the company's issued and outstanding common stock, has agreed to
vote the estate-held shares in favor of the transaction and has given
a proxy to Park Acquisitions, Inc. and its acquisition subsidiary for
these purposes.
A stockholders' meeting for the purpose of voting on the transaction
is being scheduled for early May, 1995."
Item 7. Financial Statements, Pro Forms Financial Information and Exhibits
(c) Exhibits
10 -- Federal Communications Commission Order dated April 10,
1995, consenting to the transfer of Park Communications, Inc. and
its broadcast licensee subsidiaries to Park Acquisitions, Inc.
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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.
PARK COMMUNICATIONS, INC.
Date: 4/11/95 /s/ Wright M. Thomas
_____________________________
Wright M. Thomas
President, Chief Operating Officer,
Assistant Secretary and Director
Date: 4/11/95 /s/ Randel N. Stair
_____________________________
Randel N. Stair
Vice President -- Chief Financial
Officer, Controller, Treasurer and Assistant
Secretary (Principal Financial Officer)
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EXHIBIT INDEX
10 -- Federal Communications Commission Order dated April 10, 1995,
consenting to the transfer of Park Communications, Inc. and its broadcast
licensee subsidiaries to Park Acquisitions, Inc.
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EXHIBIT 10
Before the
Federal Communications Commission
Washington, D.C. 20554
LETTER
Released: April 10, 1994
Dorothy D. Park
Personal Representative of the Estate of Roy H. Park
c/o Park Communications, Inc.
Terrace Hill
Ithaca, New York 14850
Park Acquisitions, Inc.
c/o Eckert, Seamans, Cherin & Mellott
One International Place, 18th Floor
Boston, Massachusetts 02110
Applicants:
This refers to the applications for Commission consent to transfer the
licenses of 31 television and radio stations and three television
translator stations held by subsidiaries of Park Communications, Inc.
("PCI") from Dorothy Park, Personal Representative of the Estate of Roy H.
Park to Park Acquisitions, Inc. ("PAI"). 1 Because the Grade A contours of
television stations in Greenville, North Carolina, in Chattanooga,
Tennessee, and in Richmond, Virginia, encompass the communities of license
of commonly owned AM and FM radio stations, the proposed transfer would
violate the one-to-a market rule, found in Section 73.3555(c) of the
Commission's Rules. 2 47 C.F.R. Sec.73.3555(c) (1994). This rule
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1 The stations involved in this transfer are: WNCT-TV, WNCT-AM, WNCT-FM,
GREENVILLE, NC (BTCCT-941107KJ, BTC-941107KK, BTCH-941107KL); WBMG(TV),
Birmingham, AL (BTCCT-941107KM); WSLS-TV, Roanoke, VA (BTCCT-941107KT);
WUTR(TV), Utica, NY (BTCCT-941107KW); WDEF-TV, Chattanooga, TN (BTCCT-
941107KX); WJHL-TV, Johnson City, TN (BTCCT-941107LA); WTVR-TV, Richmond,
VA (BTCCT-941107LD); WTVQ-TV, Lexington, KY (BTCCT-941107LK); KALB-TV,
Alexandria, LA (BTCCT-941107LN); KWJJ-AM, KWJJ-FM, Portland, OR (BTC-
941107KN, BTCH-941107KO); KJJO-AM, KJJO-FM, St. Louis Park, MN (BTC-
941107KP, BTCH-941107KQ); WNAX-AM, WNAX-FM, Yankton, SD (BTC-941107KR,
BTCH-941107KS); WHEN-AM,WHEN-FM, Syracuse, NY (BTC-941107KU, BTCH-
941107KV); WDEF-AM, WDEF-FM, Chattanooga, TN (BTC-941107KY, BTCH-941107KZ);
WTVR-AM, WTVR-FM, Richmond, VA (BTC-941107LB, BTCH-941107LC), KEZX-AM,
KEZX-FM, Seattle, WA (BTC-941107LF, BTCH-941107LE); WPAT-AM, WPAT-FM,
Paterson, NJ (BTC-941107LG, BTCH-941107LH); KWLO-AM, KFMW-FM, Waterloo, IA
(BTC-941107LI, BTCH-941107LJ): WNLS-AM, WTNT-FM, Tallahassee, FLh) (BTC-
941107LL, BTCH-941107LM); and three TV translators WO5BI, Morehead City, NC
(BTCTTV-941107LO); W04CB, Sylacauga, AL (BTCTVL-941107LO); and W63AE,
Oneonta, NY (BTCTT-941107LP).
2 The stations involved are: Greenville, North Carolina (WNCT-TV, WNCT-AM,
WNCT-FM); Chattanooga, Tennessee (WDEF-TV, WDEF-AM, WDEF-FM); and Richmond,
Virginia (WTVR-TV, WTVR-AM, WTVR-FM).
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proscribes common ownership of a television station and radio stations in the
same market. 3 Consequently, you have requested a temporary 12-month waiver of
the rule in order to give you time to divest yourself of the radio stations in
an orderly manner. David Lampel, Atlas News and Information Services, Inc., an
unsuccessful minority bidder for the Park stations, and WVGO License Limited
Partnership and Benchmark Radio Acquisition Fund III Limited Partnership
("WVGO"), licensee of WVGO-FM, Richmond, Virginia, filed petitions to deny your
applications, and you filed responses to these petitions. The Memphis
Development Company ("MDC") has also filed an informal objection against your
applications. On January 27, 1995, WVGO requested that the Commission allow it
to withdraw its petition. 4
In support of your temporary waiver request, you note that granting
your request will not create any new prohibited ownership combinations, and
that in similar instances the Commission has granted temporary waivers.
You also assert that allowing a 12-month waiver will serve the public
interest by permitting the current service provided by the Park stations to
continue uninterrupted. Furthermore, you note that a rushed sale of the
stations may cause several negative consequences such as unnecessarily
limiting the pool of buyers, thereby possibly excluding minorities and
potentially decreasing the value of the stations. If granted the temporary
waiver, however, you pledge that PAI will undertake an affirmative effort
to find minority buyers for the stations.
Additionally, you state that none of the affected markets suffer from
a lack of media voices, and therefore granting the waiver will not create
an undue economic concentration of media voices. You note that Greenville,
North Carolina falls into the Greenville-New Bern-Washington Area of
Dominant Influence ("ADI") for television and the North Carolina Metro
Survey Area ("MSA") for radio. According to your waiver request, a total
of 9 television stations, 43 radio stations, a cable service with 60%
penetration in the area and 11 general or community newspapers serve this
area. In the Chattanooga, Tennessee ADI and MSA, a total of 8 television
stations, 32 radio stations, a cable operator with 63.6% penetration and 10
general or community newspapers exist. Lastly, you note that the Richmond,
Virginia ADI and MSA are served by 8 television stations, 34 radio
stations, three cable operators with 55.8% penetration and 8 general or
community newspapers. Finally, you assert that permitting existing
grandfathered combinations to continue for an additional 12-month period in
order to allow an orderly divesture poses no threat to diversity or to
economic competition in the affected markets.
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3 PCI currently holds these stations pursuant to the grandfathering
provisions of Section 73.3555, Note 4. See 47 C.F.R. Sec73.3555, n.4.
4 The WVGO principals certified that they did not, and will not, receive
any money or other consideration for the withdrawal of their petition. 47
C.F.R. Sec.73.3588. Regardless of this request for permission to withdraw,
however, once a petition to deny is filed we are obligated to consider its
merits. Viacom Inc., 9 FCC Rcd 1577, 1577 (1994); Booth American Co., 58
F.C.C. 2d 553, 554 (1976). To the extent that the issues raised by Mr.
Lampel and MDC are similar to those raised by WVGO, however, they will be
discussed below. We have reviewed the remaining WVGO allegations and find
that they do not raise a substantial and material question as to whether
approval of the transfer would serve the public interest, convenience and
necessity.
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The ultimate objectives of the Commission's multiple ownership rules
are to promote economic competition and diversity of programming and
viewpoints in order to further the public interest. See Amendment of
Section 73.3555 of the Commission's Rules, 4 FCC Rcd 1723 (1989), recon.
granted in part and denied in part, 4 FCC Rcd 6489 (1989); Attribution of
Ownership Interests, 97 F.C.C. 2d 997 (1984), recon. granted in part and
denied in part, 1 FCC Rcd 802 (1986). The Commission is not, however,
without flexibility to respond to situations where application of fixed
multiple ownership standards would be contrary to other public interest
concerns. Before we will grant such a waiver, an applicant must sustain
the burden of showing that the benefits to be achieved by its proposal are
in the public interest and that a waiver would not compromise the
fundamental policies served by the rule.
On the basis of the representations before us and the circumstances of
this case, we find that a temporary waiver would be consistent with the
public interest and with our previous decisions. In the past we have held
that forcing an immediate sale for diversity purposes alone would not be in
the public interest where the result of such an action may be to
unnecessarily restrict the value of the station, Knoxville Channel 8
Limited Partnership, 4 FCC Rcd 4760, 4761 (1989), or to limit the range of
potential buyers to those with immediate access to the necessary capital,
thereby possibly precluding purchase by local groups or minority-controlled
entities, Citadel Communications Company, Ltd., 5 FCC Rcd 3842, 3844
(1990). In addition, in view of the numerous other media services
available and the longstanding grandfathered common ownership of the
stations involved, we find that no undue concentration of control of the
media or adverse effect on diversity will result from a grant of this
temporary request.
We turn next to the allegations raised in the filings by Mr. Lampel
regarding the transferor and its investment adviser, and by the MDC
regarding the transferee's funding source. According to information
supplied in the pleadings, it appears that the sale of PCI occurred by
means of a formal auction process, conducted with the assistance of an
investment adviser. As part of this process, the investment adviser
required that any entity interested in bidding on PCI demonstrate that it
had the financial resources available to consummate the transaction.
Entities who did this were then asked to enter a confidentiality agreement
for the purpose of receiving a confidential memorandum regarding PCI's
finances for use in making a preliminary bid. The leading bidders then had
until October 17, 1994 to submit a final bid.
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In his objection, 5 Mr. Lampel asserts that the investment adviser
placed him at a disadvantage compared with other bidders by denying him the
financial information on PCI. Additionally, he claims that the investment
adviser tried to "pre-qualify" him, thus making it more difficult for him
to attempt to purchase the stations. He further argues that the investment
adviser's actions denied him both procedural and substantive due process
because, he alleges, a similarly situated non-minority bidder would not
have been treated in the same manner. In his reply, he also suggests that
since the Securities and Exchange Commission has found the investment
adviser in violation of the Exchange Act in matters entirely unrelated to
its dealings with PCI, the investment adviser should not be entrusted with
aiding in the PCI transaction. He also urges us to impute the investment
adviser's alleged misdeeds to the transferor. Furthermore, he notes that a
limited partner in the investment advising firm also serves on the board of
directors of PCI and, as such, has an undisclosed cognizable interest in
the company which, he insinuates, poses a conflict of interest. Lastly, he
asserts that by using the assistance of an investment adviser PCI
improperly delegated to a non-licensee decisions regarding appropriate
bidders. For the reasons stated above, Mr. Lampel requests that the
Commission declare the agreement null and void and give him, as a minority
bidder and, by his assertion, a more experienced broadcaster, an equal
chance to acquire the stations. In his reply, Mr. Lampel also requests
that we conduct a hearing to further investigate his claims.
Initially, we note that throughout Mr. Lampel's arguments runs the
general implication that the public interest may better be served if he
were to purchase PCI rather than PAI. In making our determination
regarding approval of an application for transfer of control, however,
Section 310(d) of the Communications Act limits our consideration to the
transferee proposed in this application. Under the Act, "the Commission
may not consider whether the public interest, convenience, and necessity
might be served by the transfer . . . to a person other than the proposed
transferee. . . ." 47 U.S.C. Sec. 310(d). Since we cannot consider whether
another buyer, such as Mr. Lampel, might comparatively better serve the
public interest, his suggestion to this effect does not establish the need
for a hearing. See Citadel Communications Company, Ltd., 5 FCC Rcd at
3844.
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5 In his filing, Mr. Lampel failed to meet both our procedural and our
substantive standing requirements. In his original filing, Mr. Lampel did
not support his allegations with an affidavit of someone with personal
knowledge thereof, as required by Section 309(d)(1) of the Communications
Act. While he did include an affidavit in his reply to the opposition, he
still failed to comport with our procedural requirements by not serving a
copy of the petition on PAI, the transferee. See 47 U.S.C. Sec.309(d)(1).
Additionally, Mr. Lampel does not meet the substantive requirements of
standing under Section 309 as a "party in interest" merely by claiming to
be a "ready, willing and able buyer." Greyson Enterprises, Inc., 77 F.C.C.
2d 156, 161 (1980). Because he fails to meet our standing requirements,
Mr. Lampel's petition will be treated as an informal objection pursuant to
47 C.F.R. Sec.73.3587, See, e.g., Pacific Broadcasting Corp., 66 F.C.C. 2d
256, 256-57 (1977). Similarly, although in his reply Mr. Lampel raises a
series of new allegations in contravention of our rule requiring that a
reply be limited to the matters raised in the opposition, 47 C.F.R.
Sec.1.45(c), we will nonetheless examine these allegations on their merits.
<PAGE>
Section 309(d)(1) of the Communications Act requires that a petition
to deny contain specific allegations of fact, supported by an affidavit of
someone with personal knowledge thereof, sufficient to show that a grant of
the application would be prima facie inconsistent with the public interest.
If the petition meets this threshold requirement, the Commission must then
examine all of the material before it to determine whether there is a
substantial and material question of fact requiring resolution in a
hearing. 47 U.S.C. Sec. 309(d)(1)-(2). Although Mr. Lampel noted that he
will make available to the Commission documents and testimony to support
his contentions, by not including such information within the petition he
failed to support his allegations.
Indeed, none of the information provided in any of the pleadings
supports Mr. Lampel's claims of irregularities in the auction process.
Contrary to Lampel's assertions, PCI did not act improperly in employing an
investment adviser to assist with this process. Such delegation of
business dealings occurs frequently and does not violate any Commission
rule or policy. Moreover, information proffered by PCI in its opposition
to Mr. Lampel's filing rebuts his general allegations concerning unfairness
in the bidding process. PCI submitted a copy of a letter written by its
counsel responding to letters written by petitioner to Mrs. Park raising
similar claims of unfairness. In this response letter, PCI notes that it
and its investment adviser attempted to accommodate Mr. Lampel by, inter
alia, providing his representative with the same information given to all
other parties interested in acquiring the company, and by affording him an
extra week to submit a final bid. Later, counsel for PCI even attempted to
assist Mr. Lampel with the petition process by notifying him that he may be
under the misimpression that the filing deadline for petitions to deny was
December 7, 1994, rather than December 22, 1994. Although Mr. Lampel then
claimed that PCI's counsel had attempted to mislead him concerning the
deadline, no such deception occurred. Our rules provide that petitions to
deny must be filed within thirty days after issuance of public notice of
the acceptance for filing of the application. 47 C.F.R. Sec. 73.3584(a). In
this case, the thirty day period expired on December 22, 1994, as
represented by PCI's counsel. Since the information provided in Mr.
Lampel's reply does not demonstrate the occurrence of any harmful
irregularities with the auction process, petitioner's generalized
allegations concerning racial and religious discrimination, which he claims
were manifest in the form of a biased auction process, remain
unsubstantiated.
Finally, neither our attribution rules, nor our character
qualifications policy, nor any other Commission rule or policy relating to
a transfer of control, require that we examine either the past violations
of law committed by a nonparty, such as the investment adviser, or the
relationship between a limited partner of a nonparty and the board of
directors of the transferor. Nor does precedent dictate that, in the
circumstances here, we impute to the transferor any alleged misdeeds of the
nonparty investment adviser. See, e.g., Univision Holdings, Inc., 7 FCC
Rcd 6672, 6682 (1992); Character Qualifications, 102 F.C.C. 2d 1179, 1205-
06, reconsidered in part, 1 FCC Rcd 421 (1986); Attribution of Ownership
Interests, 97 F.C.C. 2d 997. Similarly, none of our rules or policies
require that the transferor note in its application that a member of its
board also serves as a limited partner of its investment adviser. Thus, we
reject Mr. Lampel's contention that these matters should affect our
decision regarding grant of the transfer of control.
In its objection, MDC makes four allegations pertaining to PAI's major
source of funding, a loan from the Retirement Systems of Alabama ("RSA"),
the Alabama state employees and teachers pension fund. First, MDC urges
that, given the potential risk involved in investing in a media
conglomerate, a state pension fund should not be financing such a
transaction, especially in a situation where, as here, it will have little
control over the business. Additionally, MDC notes that Alabama's governor
objected to a prior attempt by the RSA to purchase a television station and
that since this transaction involves stations in Alabama, as well as in
other states, the sale "represents not only a major conflict of interest
with RSA and the Chief Executive Officer of the state [of Alabama], but
creates a similar potential conflict with RSA and CEO's of several states
charged with protecting retirement funds of similar employees." Next, it
asserts that a pension fund should not make such a large investment, and
questions whether PAI paid too much to acquire PCI. Lastly, MDC claims
that the RSA has a large number of African American investors, but that it
has not conducted activities aimed at benefiting Alabama's African American
citizens.
MDC's concerns about the RSA will not affect our decision concerning
grant of this transfer. No rule or policy confers on the Commission
jurisdiction to examine the business decisions of a nonparty to the
application where these decisions affect neither the qualifications of the
applicants nor involve a public interest issue relating to a party to the
transfer. This is true even where the nonparty, such as the RSA, provides
the majority of the funding for the transaction. See Attribution of
Ownership Interests, 97 F.C.C. 2d at 1022. Thus, as part of our
determination about whether to approve the transfer, we have no authority
to consider the wisdom of the pension fund's decision to invest in PAI in
the manner in which it has chosen, the prudence of the price paid by PAI to
acquire PCI, or the relationship between the RSA and the African American
citizens of Alabama. See Character Qualifications, 102 F.C.C. 2d at 1205-
06. 6
Lastly, we find that MDC's concerns that the transfer will cause a
conflict of interest between the RSA, the governor of Alabama, and the
governors of other states, does not provide grounds to deny this transfer.
As MDC noted in its objection, the former Alabama governor had protested
the 1989 attempt by a subsidiary of the RSA to purchase WSFA(TV)
Montgomery, Alabama, based on his belief that operation by a state agency
of a television station which covers state government creates a conflict of
interest. Ultimately the parties dismissed the assignment application,
thus rendering the issue moot. See File No. BALCT-881223KH (1989). Not
only does the instant transaction differ factually from the proposed
WSFA(TV) transaction, but no elected officials have raised any similar
concerns regarding potential conflicts of interest.
In conclusion, having considered all the materials before us in this
matter, we find that Mr. Lampel and the MDC have failed to raise a
substantial and material question of fact such that their allegations would
warrant a hearing. 47 U.S.C. Sec. 309(d)(2). Further, based on the above
representations, we believe that a temporary waiver of Section 73.3555(c)
is consistent with Commission precedent and will serve the public interest.
Accordingly, your requested waiver of the one-to-a-market provision to
permit Park Acquisitions, Inc. to hold cognizable interests in a television
station, and an AM and FM station in the Greenville, North Carolina,
Chattanooga, Tennessee and Richmond, Virginia markets IS GRANTED, subject
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6 We also note that PAI complied with our application requirements by
providing all necessary information about its funding sources, see FCC 315:
Application for Consent to Transfer of Control of Park Communications Inc.,
File Nos. BTCCT-941170KJ-LQ (Question 15 and 16, Exhibits B and C, and
February 10, 1995 Amendment), and that nothing in this information
indicates that the funding arrangement violates our rules. See Data
Transmission Co., 44 F.C.C. 2d 935, 936-37 (1974).
<PAGE>
to the condition that Park Acquisitions, Inc. shall divest itself of any
interest in, and connection with, the radio stations no later than 12
months from consummation of this transaction. Additionally, the petition
to deny filed by David Lampel, Atlas News and Information Services, Inc.,
when considered as an informal objection, and the informal objection filed
by the Memphis Development Company ARE DENIED. Also, the petition filed by
WVGO License Limited Partnership and Benchmark Radio Acquisition Fund III
Limited Partnership IS DISMISSED. Furthermore, finding that the applicants
are fully qualified and the public interest would be served thereby, the
applications for transfer of control of the licensees of the 31 television
and radio stations and the three television translators from Dorothy Park,
Personal Representative of the Estate of Roy H. Park, to Park Acquisitions,
Inc. ARE GRANTED.
This letter was adopted by the Commission on March 27, 1995.
BY DIRECTION OF THE COMMISSION
William F. Caton
Acting Secretary
