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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) August 6, 1998
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MAGICWORKS ENTERTAINMENT INCORPORATED
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(Exact name of registrant as specified in its charter)
DELAWARE
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(State or other jurisdiction of incorporation)
0-27088 87-0425513
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(Commission File Number) (IRS Employer Identification No.)
930 WASHINGTON AVENUE, 5TH FLOOR
MIAMI BEACH, FLORIDA 33139
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (305) 532-1566
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(Former name or former address, if changed since last report)
Page 1 of 7 pages
Index to Exhibits at page 6
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ITEM 1. CHANGES IN CONTROL OF REGISTRANT
On August 6, 1998, Magicworks Entertainment Incorporated, a Delaware
corporation (the "Company"), entered into an Agreement and Plan of Merger (the
"Merger Agreement") with SFX Entertainment, Inc., a Delaware corporation
("Parent"), and MWE Acquisition Corp., a Delaware corporation and wholly owned
subsidiary of Parent ("Purchaser"), which provides for the acquisition by Parent
of all of the outstanding shares (the "Shares") of common stock, par value $.001
per share (the "Common Stock"), of the Company by means of a cash tender offer
and a subsequent merger.
As the first step of this acquisition, Purchaser is making a cash
tender offer (the "Tender Offer") for all outstanding Shares of Common Stock at
a price of $4.00 per Share, net to the seller in cash (the "Offer Price").
Subject to certain conditions, subsequent to the Tender Offer, Purchaser will be
merged (the "Merger") with and into the Company, with the Company surviving the
Merger as a wholly owned subsidiary of Parent (the "Surviving Corporation"). In
the Merger, each Share issued and outstanding immediately prior to the effective
time of the Merger (other than Shares owned by the Purchaser, Parent or the
Company or by stockholders, if any, who are entitled to and properly exercise
appraisal rights under the Delaware General Corporation Law with respect to
their Shares) will, by virtue of the Merger and without any action by the holder
thereof, be converted into the right to receive from the Surviving Corporation
an amount of cash equal to the Offer Price net to the holder thereof, in cash,
without interest thereon, upon surrender of the certificate formerly
representing such Share. In general, holders of options and/or warrants to
purchase Common Stock which have not exercised such options and/or warrants and
validly tendered Shares issuable upon such exercise prior to the Expiration
Date, will have the right to receive in the Merger an amount of cash equal to
the product of (1) the number of Shares subject to such option or warrant and
(2) the difference between the Offer Price and the exercise price.
The Tender Offer is conditioned upon, among other things, (a) there
being validly tendered and not withdrawn prior to the Expiration Date (as
defined below) of the Tender Offer such number of Shares that, together with any
Shares owned by the Purchaser, Parent or their affiliates, would constitute a
majority of all outstanding Shares on a fully diluted basis (the "Minimum
Condition") and (b) any waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, applicable to the purchase of Shares
pursuant to the Tender Offer having expired or been terminated. For purposes of
the Merger Agreement, the term "Expiration Date" means 12:00 Midnight, New York
City time, on Thursday, September 10, 1998, unless and until the Purchaser shall
have extended the period of time during which the Tender Offer is open, in which
event the term "Expiration Date" shall mean the latest time and date at which
the Tender Offer, as so extended by the Purchaser, shall expire.
The Merger Agreement provides that, promptly upon the purchase by the
Purchaser of Shares pursuant to the Tender Offer, the Purchaser will be entitled
to designate up to such number of directors on the Company's Board of Directors
as shall give the Purchaser
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representation on the Company's Board of Directors equal to the product of the
total number of directors on the Company's Board of Directors (giving effect to
the directors elected pursuant to this sentence) multiplied by the percentage
that the aggregate number of Shares beneficially owned by Purchaser or any
affiliate of the Purchaser at such time bears to the total number of Shares then
outstanding. The Company will be required at such time, to promptly take all
actions necessary to cause the Purchaser's designees to be elected as directors
of the Company, including increasing the size of the Company's Board of
Directors or securing the resignations of incumbent directors or both. The
Company is required to use its best efforts to cause persons designated by the
Purchaser to constitute the same percentages as persons designated by the
Purchaser shall constitute of the Company's Board of Directors of (a) each
committee of the Company's Board of Directors (some of whom my be required to be
independent as required by applicable law or the rules of the American Stock
Exchange), (b) each board of directors of each subsidiary of the Company and (c)
each committee or each such board, in each case only to the extent permitted by
applicable law. Notwithstanding the foregoing, until the effective time of the
Merger, the Company's Board of Directors shall have at least one director who is
a director as of the date of the Merger Agreement and who is a not a designee of
or officer, director, employee or affiliate of Parent or the Purchaser or
officer or employee of the Company (an "Independent Director"), provided that if
the number of Independent Directors shall be reduced below one for any reason,
the Board of Directors shall designate a person to fill such vacancy who is not
a designee or officer, director, employee or affiliate of Parent, the Purchaser
or the Company.
In connection with the Merger Agreement, the Company and each of the
principal stockholders of the Company (the "Principal Stockholders"), has
entered into a Stockholder Agreement, dated August 6, 1998, with Purchaser and
Parent (collectively, the "Stockholders' Agreements" and individually a
"Stockholder Agreement") pursuant to which each of the Principal Stockholders
has agreed, among other things, (a) to tender all of its Shares into the Tender
Offer and not to withdraw such Shares as long as the Stockholder Agreement
remains in effect and (b) so long as the Stockholder Agreement remains in
effect, at any meeting of stockholders of the Company called to vote upon the
Merger (or in connection with any action by written consent relating to the
Merger), to vote all Shares held by it in favor of the Merger. At the close of
business on August 11, 1998, the Principal Stockholders owned 19,171,800 Shares,
representing approximately 73.8% of the outstanding Shares (approximately 63.0%
of the outstanding Shares on a fully diluted basis). Accordingly, it is expected
that the Minimum Condition will be satisfied and any required stockholder
approval will be obtained.
Copies of the Merger Agreement and the Stockholders' Agreements are
exhibits hereto and are incorporated herein by reference in their entirety. A
copy of Parent's and Purchaser's Offer to Purchase, dated August 13, 1998, is
also attached as an exhibit hereto and is incorporated herein by reference in
its entirety. Additionally, information concerning "Security Ownership of
Certain Beneficial Owners and Management" is included in the Company's
Information Statement pursuant to Section 14(f) of the Securities Exchange Act
of 1934 and Rule 14f-1 thereunder, which Information Statement is included as
Annex B to the Company's Solicitation/Recommendation Statement on Schedule
14D-9, which statement was filed with the
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Securities Exchange Commission on August 13, 1998 and is incorporated by
reference in its entirety herein.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(C) EXHIBITS
10.1 Agreement and Plan of Merger, dated as of August 6,
1998, by and among Parent, Purchaser and the Company.
10.2 Offer to Purchase dated August 13, 1998.
10.3 Stockholder Agreement, dated August 6, 1998, among the
Purchaser, Parent and Krassner Family Investments
Limited Partnership.
10.4 Stockholder Agreement dated August 6, 1998, among the
Purchaser, Parent and Joe Marsh.
10.5 Stockholder Agreement dated August 6, 1998, among the
Purchaser, Parent and Lee Marshall.
10.6 Stockholder Agreement dated August 6, 1998, among the
Purchaser, Parent and Glenn Bechdel.
10.7 Stockholder Agreement dated August 6, 1998, among the
Purchaser, Parent and John W. Ballard.
10.8 Text of Press Release dated August 7, 1998.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MAGICWORKS ENTERTAINMENT
INCORPORATED
Dated: August 20, 1998 By: /s/ Brad L. Krassner
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Brad L. Krassner
Co-Chairman of the Board and
Chief Executive Officer
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT DESCRIPTION PAGE NUMBER
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10.1 Agreement and Plan of Merger, dated as of August 6, (1)
1998, by and among SFX Entertainment, Inc. ("Parent"), MWE
Acquisition Corp. ("Purchaser") and Magicworks Entertainment
Incorporated.
10.2 Offer to Purchase dated August 13, 1998 (2)
10.3 Stockholder Agreement, dated August 6, 1998, among the (3)
Purchaser, Parent and Krassner Family Investments Limited
Partnership.
10.4 Stockholder Agreement dated August 6, 1998, among the (4)
Purchaser, Parent and Joe Marsh.
10.5 Stockholder Agreement dated August 6, 1998, among the (5)
Purchaser, Parent and Lee Marshall.
10.6 Stockholder Agreement dated August 6, 1998, among the (6)
Purchaser, Parent and Glenn Bechdel.
10.7 Stockholder Agreement dated August 6, 1998, among the (7)
Purchaser, Parent and John W. Ballard.
10.8 Text of Press Release dated August 7, 1998. (8)
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(1) Incorporated by reference to Exhibit (c)(1) to Parent's and Purchaser's
Tender Offer Statement on Schedule 14D-1 dated August 13, 1998 (the
"Schedule 14D-1"), which Schedule 14D-1 was filed with the Securities and
Exchange Commission on August 13, 1998.
(2) Incorporated by reference to Exhibit (a)(1) of the Schedule 14D-1.
(3) Incorporated by reference to Exhibit (c)(2) to the Schedule 14D-1.
(4) Incorporated by reference to Exhibit (c)(3) to the Schedule 14D-1.
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(5) Incorporated by reference to Exhibit (c)(4) to the Schedule 14D-1.
(6) Incorporated by reference to Exhibit (c)(5) to the Schedule 14D-1.
(7) Incorporated by reference to Exhibit (c)(6) to the Schedule 14D-1.
(8) Incorporated by reference to Exhibit (a)(3) to the Schedule 14D-1.
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