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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): October 1, 1999
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ARAHOVA COMMUNICATIONS, INC.
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(Exact name of registrant as specified in its charter)
0-16899
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(Commission File Number)
Delaware 25-1844576
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(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
One North Main Street - Coudersport, PA 16915-1141
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(Address of principal executive Offices) (Zip Code)
Registrant's telephone number, including area code: (814) 274-9830
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Century Communications Corp.
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(Former name or former address, if changed since last report)
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Item 1. Changes in Control of Registrant
On October 1, 1999, Adelphia Communications Corporation ("Adelphia"), a
Delaware corporation and Century Communications Corp. ("Century"), a New Jersey
corporation, consummated a merger ("the Merger") whereby Century was merged with
and into Adelphia Acquisition Subsidiary, Inc. ("Merger Sub"), a Delaware
corporation and a wholly owned subsidiary of Adelphia, pursuant to an Agreement
and Plan of Merger ("the Merger Agreement"), dated as of March 5, 1999, as
amended as of July 12, 1999 and July 29, 1999 by and among Adelphia, Century and
Merger Sub. Upon the effectiveness of the Merger, Adelphia Acquisition
Subsidiary, Inc. changed its name to Arahova Communications, Inc. ("Arahova").
As a result of the Merger, Century was merged into Arahova, a wholly owned
subsidiary of Adelphia, which became the successor registrant to Century.
In connection with the closing of the merger, Adelphia issued approximately
47.8 million new shares of Adelphia Class A common stock, paid approximately
$812 million to the stockholders of Century and assumed approximately $2.0
billion of debt. The amount of assumed debt gives effect to approximately $284
million of additional indebtedness expected to be incurred in connection with
the closing of Century's pending AT&T joint venture. The stockholders of both
Adelphia and Century approved the transaction at stockholder meetings held on
October 1, 1999. The Merger Agreement, which was negotiated by the parties
thereto in an arms-length transaction, was previously announced by Adelphia on
March 5, 1999.
Century is engaged primarily in the ownership and operation of cable
television systems with significant concentrations of basic subscribers in
California, Colorado and Puerto Rico. As of May 31, 1999, Century had
approximately 1,610,000 basic subscribers after giving effect to Century's
pending joint venture with AT&T in the Los Angeles, California area. Adelphia
will continue to operate the Century cable television systems after the merger.
The sources for the cash consideration paid by Adelphia included cash on hand
from financing transactions completed earlier in the current year and funds
reborrowed under four existing bank credit facilities between Adelphia
subsidiaries and four different lending bank groups for which Toronto Dominion
(Texas), Inc., The Bank of Nova Scotia, First Union National Bank and Toronto
Dominion (Texas), Inc., respectively, serve as Administrative Agent.
In the Merger, Century Class A common stockholders were entitled to
elect to receive $44.14 in cash or 0.77269147 of a share of Adelphia Class A
common stock on a share-by-share basis, subject to certain adjustments and
prorations. The aggregate number of shares of Century Class A common stock
converted into the right to receive cash in the Merger was limited to 20.76% of
the number of shares of Century Class A common stock outstanding immediately
prior to the effective time of the Merger. The aggregate number of shares of
the Century Class A common stock converted into shares of Adelphia Class A
common stock in the Merger was limited to 79.24% of the number of such shares of
Century Class A common stock outstanding immediately prior to the effective time
of the Merger.
In the Merger, Century Class B common stockholders were entitled to
elect to receive $48.14 in cash or 0.84271335 of a share of Adelphia Class A
common stock on a share-by-share basis, subject to certain adjustments and
prorations. The aggregate number of shares of Century
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Class B common stock converted into the right to receive cash in the Merger was
limited to 24.54% of the number of shares of Century Class B common stock
outstanding immediately prior to the effective time of the Merger. The aggregate
number of shares of Century Class B common stock converted into the right to
receive shares of Adelphia Class A common stock in the Merger was limited to
75.46% of the number of shares of Century Class B common stock outstanding
immediately prior to the effective time of the Merger.
Century Class A common stockholders made stock elections for an amount
of Adelphia Class A common stock exceeding the amount available to such holders.
As a result, holders of Century Class A common stock who elected to receive
Adelphia Class A common stock will receive 86.42000% of their consideration in
Adelphia Class A common stock, or approximately 0.6678 of a share of Adelphia
Class A common stock, and 13.58000% of their consideration in cash, or
approximately $5.99, for each share of Century Class A common stock. Holders of
Century Class A common stock who elected to receive cash will receive $44.14 per
share, without interest.
Century Class B common stockholders made stock elections for amounts
of cash and Adelphia Class A common stock equal to the amounts available to such
holders. As a result, holders of Century Class B common stock who elected to
receive Adelphia Class A common stock will receive 0.84271335 of a share of
Adelphia Class A common stock for each share of Century Class B common stock,
and holders of Century Class B common stock who elected to receive cash will
receive $48.14 per share, without interest.
Also pursuant to the terms of the Merger Agreement, each outstanding
option to purchase shares of Century Class A common stock granted under
Century's 1993 Non-Employee Directors' Stock Option Plan, the 1994 Stock Option
Plan, and all other similar plans or arrangements (collectively "Option Plans"),
whether or not previously exercisable or vested, became fully exercisable and
vested. Option holders were given the option to exercise immediately prior to
the Merger or to rollover their options. The number of shares noted above that
were issued by Adelphia in connection with the Merger does not include any
shares with respect to Century options that were rolled over by option holders
(options with respect to approximately 440,000 Century Class A common shares
that were converted into options with respect to approximately 330,000 Adelphia
Class A common shares) or that were otherwise converted to cash pursuant to
their terms. Furthermore, all restricted shares of Century Class A common stock
issued pursuant to the 1992 Management Equity Incentive Plan became fully vested
and ceased to be restricted.
In addition to the above information regarding the consideration paid
in the Merger, at the effective time of the Merger, Adelphia also purchased
Citizens Utilities Company's 50% interest in the Century/Citizens Joint Venture,
one of Century's 50% owned joint ventures, for a purchase price of approximately
$157.5 million, comprised of approximately $27.7 million in cash, approximately
1.85 million shares of Adelphia Class A common stock and the assumption of
indebtedness. This joint venture serves approximately 92,300 basic subscribers
in California and was jointly owned by the Company and Citizens Cable Company, a
subsidiary of Citizens.
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Also pursuant to the Merger Agreement, the Board of Directors of
Adelphia will expand the size of the Board by three positions after the Adelphia
1999 annual meeting of stockholders to be held on October 25, 1999, and will
appoint Leonard Tow, Bernard Gallagher and Scott Schneider to the Board of
Directors of the Company after the 1999 annual meeting, and have the new
appointees serve until the next annual meeting of stockholders. Messrs. Tow,
Gallagher and Schneider previously served as directors and executive officers of
Century and were holders of Century common stock at the time of the merger. So
long as the former holders of Century Class B common stock (Leonard Tow and two
trusts established by Leonard Tow and Claire Tow, his wife) and their permitted
transferees and assignees continue to own at least 10% of the outstanding common
stock of Adelphia, they will be entitled to nominate up to three members to
Adelphia's Board of Directors. Also, pursuant to agreements among Adelphia, John
Rigas, Michael Rigas, Timothy Rigas, James Rigas, the holders of Century Class B
common stock and Claire Tow, Adelphia and the Rigas family have granted each of
the holders of Century Class B common stock certain rights with respect to the
Adelphia Class A common stock they will receive in the merger, including rights
to make demand registrations of their shares, to piggyback and include their
Adelphia shares in registrations of shares undertaken by Adelphia, and to tag
along or participate in sales of shares of Adelphia common stock by any such
member of the Rigas family. These rights are subject to various qualifications,
limitations and restrictions as set forth in the applicable agreements.
In connection with the Merger, Arahova entered into (i) a Ninth
Supplemental Indenture, dated as of October 1, 1999, between Arahova and U.S.
Bank Trust National Association (the "Trustee"), successor trustee to Bank of
America National Trust and Savings Association, to the Indenture, dated as of
February 12, 1992, between Century and the Trustee and (ii) a First Supplemental
Indenture, dated as of October 1, 1999, between Arahova and U.S. Bank Trust
National Association, to the Indenture, dated as of January 15, 1998, between
Century and the Trustee, each as required by such indentures and pursuant to
which Arahova assumed the obligations of Century under such indentures.
Additional information concerning the above transactions is contained
in the Joint Proxy Statement/Prospectus regarding the Merger filed by Adelphia,
which is an exhibit hereto and is incorporated by reference herein.
Item 2. Acquisitions or Dispositions of Assets.
See Item 1, which is incorporated herein by reference.
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Item 7. Financial Statements and Exhibits.
(c) Exhibits
Exhibit Description
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99.01 Definitive Joint Proxy Statement/Prospectus dated August 12, 1999
(Incorporated herein by reference to Registration Statement No.
333-85101 of Adelphia on Form S-4, filed on August 12, 1999).
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.
ARAHOVA COMMUNICATIONS, INC.
Date: October 14, 1999 By: /s/ Timothy J. Rigas
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Timothy J. Rigas
Executive Vice President, Treasurer and Chief
Financial Officer
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EXHIBIT INDEX
Exhibit Description
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99.01 Definitive Joint Proxy Statement/Prospectus dated August 12, 1999
(Incorporated herein by reference to Registration Statement No.
333-85101 of Adelphia on Form S-4, filed on August 12, 1999).
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