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 June 27, 1997 Commission File Number 0-26076
(Date of earliest event reported)
SINCLAIR BROADCAST GROUP, INC.
(Exact name of registrant)
Maryland 52-1494660
(State of organization) (I.R.S. Employer
Identification Number)
2000 West 41st Street,
Baltimore, Maryland 21211
(Address of principal executive offices and zip code)
(410) 467-5005
(Registrant's telephone Number)
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ITEM 5. OTHER EVENTS
Sinclair Broadcast Group, Inc. (the "Company" or "Sinclair") is filing this
report on Form 8-K in connection with its private offering of certain Senior
Subordinated Notes due 2007 (the "Notes") to provide certain additional
disclosure to purchasers of the Notes and such disclosure is incorporated by
reference into the Offering Memorandum for the Notes. The Company incorporates
herein by reference the information contained in the press release filed as
Exhibit 99 to this Form 8-K.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following is a general summary of certain of the anticipated U.S.
federal income tax consequences of the purchase, ownership and disposition of
the Notes. The summary is for general information only and is based on the U.S.
Internal Revenue Code of 1986, as amended (the "Code"), the U.S. Treasury
Regulations promulgated or proposed thereunder, and judicial and administrative
interpretations thereof, all as in effect on the date hereof, and all of which
are subject to change, possibly with retroactive effect, or to different
interpretations.
The tax treatment of a holder of the Notes may vary depending upon the
particular situation of the holder. The summary is limited to investors who will
hold the Notes as "capital assets" within the meaning of Section 1221 of the
Code and does not deal with holders in special tax situations (including, but
not limited to, insurance companies, tax-exempt organizations, financial
institutions, dealers in securities or currencies, holders whose functional
currency is not the U.S. dollar, or holders who will hold Notes as a hedge
against currency risks or as part of a straddle, synthetic security, conversion
transaction, or other integrated investment comprised of Notes and one or more
other investments), who may be subject to special rules not discussed below. The
summary is applicable only to purchasers of Notes on original issue at their
issue price (as defined below) and does not address other purchasers. The
summary does not address the effect of any state, local or foreign tax law on a
holder of Notes. As used herein, the term "U.S. Holder" means an individual who
is a citizen or resident of the United States, a partnership, corporation or
other entity organized in or under the laws of the United States or any state
thereof, an estate or trust that is subject to U.S. federal income taxation
without regard to the source of its income.
The summary does not constitute, and should not be considered as, legal or
tax advice to prospective holders of Notes. Each prospective holder of Notes
should consult a tax advisor as to the particular tax consequences of holding
Notes to such holder, including the applicability and effect of any state, local
or foreign tax laws.
INTEREST AND ORIGINAL ISSUE DISCOUNT
A Note will be treated as issued at an original issue discount. The
original issue discount for a Note will be equal to the excess of the "stated
redemption price at maturity" of the Note over its issue price (defined as the
first price at which a substantial amount of Notes of the same issue is sold to
the public). The "stated redemption price at maturity" of a Note is the total of
all payments provided by the Note that are not payments of "qualified stated
interest." A U.S. Holder will be required to include original issue discount on
a Note in income as it accrues (using the constant-yield method described in the
applicable U.S. Treasury Regulations), which will result in recognition of
income before the receipt of cash attributable to such income.
Qualified stated interest on a Note will be taxable to a U.S. Holder as
ordinary interest income at the time it is accrued or is received in accordance
with the U.S. Holder's method of accounting for tax purposes. A "qualified
stated interest" payment is a payment of stated interest that is unconditionally
payable in cash or property (other than debt instruments of the issuer) at least
annually during the entire term of the Note, including short periods at a single
fixed rate.
A U.S. Holder may elect to treat all interest on a Note as original issue
discount and calculate the amount includable in gross income under the
constant-yield method. The election is made for the year in which the U.S.
Holder acquired the Note, and may not be revoked without the consent of the U.S.
Internal Revenue Service.
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PURCHASE, SALE AND RETIREMENT OF THE NOTES
A U.S. Holder's tax basis in a Note will be its cost, increased by the
amount of any original issue discount included in the U.S. Holder's income with
respect to the Note and reduced by the amount of any cash payments on the Note
that are not qualified stated interest payments. A U.S. Holder will recognize
gain or loss on the sale or retirement of a Note equal to the difference between
the amount realized on the sale or retirement and the U.S. Holder's tax basis in
the Note. As a general rule (with the exception, among other things, of amounts
attributable to accrued but unpaid interest), gain or loss recognized on the
sale or retirement of a Note will be capital gain or loss and will be long-term
capital gain or loss if the Note was held for more than one year.
DESCRIPTION OF THE NOTES
The definition of Permitted Investment in the description of the Notes for
the Company's 9% Senior Subordinated Notes due 2007 is the same as the
definition of Permitted Investment for the Company's 10% Senior Subordinated
Notes due 2005, which definition is incorporated herein by reference to the
Company's Form S-3 (Registration No. 33-94982) filed on July 26, 1995 (as
amended).
ITEM 7. EXHIBITS
Exhibit No.
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99 Press Release by Sinclair Broadcast Group, Inc., dated July 1, 1997.
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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.
SINCLAIR BROADCAST GROUP, INC.
By: /s/ David B. Amy
-------------------------------
David B. Amy
Chief Financial Officer/
Principal Accounting Officer
Dated: July 1, 1997
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NEWS RELEASE
July 1, 1997 Contact: David Amy, Chief Financial Officer
Patrick Talamantes, Dir. of Corporate Finance
FOR IMMEDIATE RELEASE (410) 467-5005
Baltimore, MD
A STATEMENT FROM SINCLAIR BROADCAST GROUP (NASDAQ: SBGI)
As a result of recent activity in Sinclair Broadcast Group, Inc.'s common stock,
and Sinclair's current financing activity, Sinclair is issuing the following
statement. In furtherance of its acquisition strategy, Sinclair routinely
reviews and conducts investigations of potential television and radio station
acquisitions. Sinclair is currently in the process of exploring various
acquisition opportunities including having submitted a bid in excess of $500
million for certain broadcasting stations. Although Sinclair is engaged in
negotiations regarding this bid and other potential transactions, Sinclair has
not entered into any definitive acquisition agreements or letters of intent with
respect to any prospective acquisition. While these and other opportunities are
being explored, Sinclair's policy is not to comment on any potential
transactions until binding agreement is reached. Further, there can be no
assurance that any such transaction will be consummated. The completion of any
such transactions could result in the incurrence by Sinclair of substantial
additional indebtedness.
Sinclair Broadcast Group, Inc. is one of the nation's largest broadcast groups,
owning and/or providing programming services to 29 television stations in 20
separate markets, and owning, providing sales and programming services to, or
having options to acquire, 34 radio stations in 8 separate markets. The
television group reaches approximately 15% of U.S. television households and
includes ABC, CBS, Fox, UPN and WB affiliates. The radio group is one of the
twenty largest groups in the United States.
