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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20479
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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) November 20, 1996
New World Television Incorporated
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(Exact name of registrant as specified in its charter)
Delaware 33-64546 59-2813891
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
3200 Windy Hill Road, Suite 1100-West, Atlanta, Georgia 30339
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(Address of principal executive offices) (Zip Code)
(770) 955-0045
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Registrant's telephone number, including area code
Not Applicable
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(Former name or former address, if changed since last report)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
As previously reported, New World Television Incorporated ("NW
Television"), a Delaware corporation and a wholly owned subsidiary of New World
Communications Group Incorporated ("NWCG"), NW Communications of San Diego,
Inc., a Delaware corporation and a wholly owned subsidiary of NW Television
("KNSD Communications"), and KNSD License, Inc., a Delaware corporation and a
wholly owned subsidiary of KNSD Communications (together with KNSD
Communications, the "KNSD Sellers"), and NBC are parties to an Asset Purchase
Agreement dated May 22, 1996 (the "KNSD Asset Purchase Agreement").
On November 20, 1996, upon the terms set forth in the KNSD Asset Purchase
Agreement, Outlet Broadcasting, Inc., a wholly owned subsidiary of NBC,
completed its purchase from the KNSD Sellers of substantially all of the assets
of the KNSD Sellers related to the ownership and operation of television
station KNSD, Channel 39, San Diego, California for a purchase price of $225
million, subject to adjustment based on Net Working Capital (as defined in the
KNSD Asset Purchase Agreement) as of such date.
On November 20, 1996, NWCG and NBC issued a press release announcing the
consummation of the transactions contemplated by the KNSD Asset Purchase
Agreement, which is filed herewith as an exhibit and incorporated herein by
reference.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(b) Pro Forma Financial Information
The information set forth in Exhibit 99.2 filed herewith is
incorporated herein by reference.
(c) The following items are filed with this report:
EXHIBIT NO. DESCRIPTION
99.1 Asset Purchase Agreement dated May 22,
1996 by and among New World Television
Incorporated, NW Communications of San
Diego, Inc., KNSD License, Inc. and
National Broadcasting Company, Inc. (1)
99.2 Pro forma financial information.
99.3 Press Release dated November 20, 1996
issued by National Broadcasting
Company, Inc. and New World
Communications Group Incorporated. (2)
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(1) Incorporated herein by reference to Exhibit 99.1 filed as part of the
Form 8-K dated May 22, 1996 of New World Communications Group
Incorporated.
(2) Incorporated herein by reference to the identical exhibit filed as part
of the Form 8-K dated November 20, 1996 of New World Communications Group
Incorporated.
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SIGNATURE
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.
New World Television Incorporated
(Registrant)
Date: December 5, 1996 By: /s/ Joseph P. Page
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Name: Joseph P. Page
Title: Vice President and
Chief Financial Officer
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EXHIBIT INDEX
Exhibit Description
99.1 Asset Purchase Agreement dated May 22, 1996 by and among New
World Television Incorporated, NW Communications of San Diego,
Inc., KNSD License, Inc. and National Broadcasting Company, Inc.
(1)
99.2 Pro forma financial information.
99.3 Press Release dated November 20, 1996 issued by National
Broadcasting Company, Inc. and New World Communications Group
Incorporated. (2)
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(1) Incorporated herein by reference to Exhibit 99.1 filed as part of the
Form 8-K dated May 22, 1996 of New World Communications Group
Incorporated.
(2) Incorporated herein by reference to the identical exhibit filed as part
of the Form 8-K dated November 20, 1996 of New World Communications Group
Incorporated.
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Exhibit 99.2
New World Television Incorporated
Pro Forma Financial Information
Basis of Presentation
In March 1995 the Company sold its investment in WSBK-TV (the "Boston
Station") for gross proceeds of $107.5 million. The Company repaid $19.5
million of the Bank Credit Agreement Loans in March 1995 and $77.3 million
of the Step-Up Notes in April 1995 from the net proceeds of the Boston
Station sale.
In November 1996 the Company sold substantially all of the assets of
KNSD-TV and its subsidiaries (collectively, the "San Diego Station") to
National Broadcasting Company, Inc. ("NBC") for gross proceeds of $225
million, subject to certain adjustments. The Company repaid in full the
outstanding balance of $27.6 million of the Bank Credit Agreement Loans and
offered to purchase up to $109.6 million of the Step Up Notes and up to
$194.3 million of the 11% Notes, less the principal amount purchased, if
any, under the Step Up Note offer.
The following condensed consolidated pro forma balance sheet gives effect
to, as of September 30, 1996, the sale of the San Diego Station and the
repayment of a portion of NW Television's debt. The following condensed
consolidated pro forma statement of operations for the nine months ended
September 30, 1996 gives effect to, as of January 1, 1996, the sale of the
San Diego Station and the repayment of a portion of NW Television's debt.
The following condensed consolidated pro forma statement of operations for
the year ended December 31, 1995 gives effect to, as of January 1, 1995,
the sale of the Boston Station, the sale of the San Diego Station and the
repayment of a portion of NW Television's debt. The pro forma financial
information does not necessarily reflect the future results or the results
that would have occurred had these transactions actually occurred on
January 1, 1996 or January 1, 1995 (in thousands, except per share).
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New World Television Incorporated
Pro Forma Balance Sheet
(dollars in thousands)
September 30, 1996
(unaudited)
<TABLE>
<CAPTION>
Historical Pro Forma
Historical KNSD Adjustments Pro Forma
---------- ---------- ----------- ---------
<S> <C> <C> <C> <C> <C>
ASSETS
Cash $ 16,017 $ (1) $ 232,355 (a) $111,138
(137,233) (b)
Receivables 52,634 (10,411) - 42,223
Television program contract rights 20,150 (4,054) - 16,096
Prepaid expenses 2,466 (41) - 2,425
Deferred income taxes 3,120 - - 3,120
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Total current assets 94,387 (14,507) 95,122 175,002
Property, plant and equipment 110,590 (11,694) - 98,896
Television program contracts rights 4,823 (218) - 4,605
Intangible assets and excess reorganization value 560,051 (86,098) (73,204) (c) 400,749
Note receivable from related party and other assets 32,978 - - 32,978
-------- ---------------------- --------
$802,829 $(112,517) $ 21,918 $712,230
======== ====================== ========
LIABILITIES AND STOCKHOLDER'S EQUITY
Accounts payable and accrued expenses $ 18,922 $ (1,639) $ 1,950 (d) $ 19,233
Income taxes payable 3,596 6,024 (c) 9,620
Payable to related parties 413 - 413
Television program contracts payable 21,265 (5,571) - 15,694
Current portion of long-term debt and notes payable 5,967 - (5,967) (b) -
-------- ---------------------- --------
Total current liabilities 50,163 (7,210) 2,007 44,960
Noncurrent television program contract rights 6,170 (532) - 5,638
Long-term debt 505,002 - (131,266) (b) 373,736
Other noncurrent liabilities 19,524 (973) - 18,551
Deferred tax credits 78,547 - (16,635) (c) 61,912
Stockholder's equity -
Common stock - -
Additional paid-in capital 184,696 - - 184,696
Retained earnings (deficit) (41,273) (103,802) (62,593) (c) 22,737
230,405 (e)
-------- ---------------------- --------
Total stockholder's equity 143,423 (103,802) 167,812 207,433
-------- ---------------------- --------
$802,829 $(112,517) $ 21,918 $712,230
======== ====================== ========
</TABLE>
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New World Television Incorporated
Pro Forma Statement of Operations
(dollars in thousands)
Nine Months Ended September 30, 1996
(unaudited)
<TABLE>
<CAPTION>
Historical
NBC
Historical Stations Adjustments Pro Forma
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<S> <C> <C> <C> <C> <C>
Net revenues $176,547 $(32,506) $ - $144,041
Operating expenses 114,622 (17,559) 97,063
Depreciation and amortization of intangible assets 27,311 (3,861) (3,230) (f) 20,220
Corporate expenses 5,505 - - 5,505
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Income from operations 29,109 (11,086) 3,230 21,253
Other income (expense):
Interest expense (39,340) - 8,130 (g) (31,210)
Interest income 2,494 - - 2,494
Other (44) - - (44)
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(36,890) - 8,130 (28,760)
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Income (loss) before income taxes (7,781) (11,086) 11,360 (7,507)
Income tax provision (561) - 512 (i) (49)
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Net income (loss) $ (8,342) $(11,086) $11,872 $ (7,556)
======== ======== ======= ========
</TABLE>
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New World Television Incorporated
Pro Forma Statement of Operations
(dollars in thousands)
Year Ended December 31, 1995
(unaudited)
<TABLE>
<CAPTION>
Historical Historical
Historical WSBK KNSD Adjustments Pro Forma
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<S> <C> <C> <C> <C> <C>
Net revenues $230,774 $(5,741) $(37,102) $ - $187,931
Operating expenses 156,627 (6,247) (22,788) - 127,592
Depreciation and amortization of intangible assets 35,103 (798) (5,113) (4,306) (f) 24,886
Corporate expenses 7,037 - - - 7,037
-------- ------- -------- -------- --------
Income from operations 32,007 1,304 (9,201) 4,306 28,416
Other income (expense):
Interest expense (54,983) - - 12,496 (g) (42,487)
Interest and investment income 3,249 - - - 3,249
Gain on sale of WSBK 41,671 - - (41,671) (h) -
Other (233) - - - (233)
-------- ------- -------- -------- --------
(10,296) - - (29,175) (39,471)
-------- ------- -------- -------- --------
Income (loss) before income taxes 21,711 1,304 (9,201) (24,869) (11,055)
Benefit (provision) for income taxes (35,080) - - 36,148 (i) 1,068
-------- ------- -------- -------- --------
Net income (loss) $(13,369) $ 1,304 $ (9,201) $ 11,279 $ (9,987)
======== ======= ======== ======== ========
</TABLE>
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Notes to Pro Forma Condensed Consolidated Financial Information
(amounts in thousands)
(a) Reflects cash estimated to be received on the sale of the San
Diego Station.
(b) Reflects the reduction of a portion of NW Television's debt with
the net proceeds from the sale of the San Diego Station. Although NW
Television will make an offer to repurchase an aggregate of
approximately $85,000 principal amount of 11% Notes at 100% of the
principal amount thereof plus accrued and unpaid interest, New World
has not assumed any holders will tender 11% Notes pursuant to such
offer because the current market price of the 11% Notes exceeds their
par value.
(c) Reflects the income tax effect of the sale of the San Diego
Station. The adjustment to intangible assets reflects a reduction of
the valuation allowance recorded for restricted net operating losses
("NOLs") whose realization did not previously meet the "more likely
than not" test of probability contained in Statement of Financial
Accounting Standards No. 109 "Accounting for Income Taxes" ("SFAS
109") due to restrictions on their use. The sale of the San Diego
Station will allow the Company to utilize a portion of these
previously restricted NOLs to reduce the tax liability associated with
the gain on the sale of the San Diego Station.
(d) Reflects the estimated costs associated with the sale of the San
Diego Station.
(e) Reflects adjustment to the gain on the sale of the San Diego
Station. The pre-tax gain on the sale of the San Diego Station is
estimated to be approximately $126,603.
(f) Reflects the adjustment of amortization of intangible assets and
depreciation of property, plant and equipment associated with the sale
of the Boston Station in 1995 and the sale of the San Diego Station in
1996.
(g) Reflects adjustments to interest expense for the repayment of a
portion of NW Television's debt with the net proceeds from the sale of
the Boston Station in 1995 and for the repayment of a portion of NW
Television's debt with the net proceeds from the sale of the San Diego
Station in 1996.
(h) Reflects adjustment to eliminate the gain recorded on the sale of
the Boston Station in 1995.
(i) Reflects adjustment of the provision for income taxes in
accordance with SFAS No. 109.
