-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Itsr/R2kE0PLmwIrD7oajLQ5FaGXCagmPlZ+jPNjKU6VDCvMvk6sjbEu/TKboG/P vfVozvdxS0NSUVu4sIXmaA== 0001035881-97-000013.txt : 19971231 0001035881-97-000013.hdr.sgml : 19971231 ACCESSION NUMBER: 0001035881-97-000013 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19971217 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19971230 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEXTLEVEL SYSTEMS INC CENTRAL INDEX KEY: 0001035881 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 364134221 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-12925 FILM NUMBER: 97746333 BUSINESS ADDRESS: STREET 1: 8770 WEST BRYN MAWR AVE CITY: CHICAGO STATE: IL ZIP: 60631 BUSINESS PHONE: 7136951000 MAIL ADDRESS: STREET 1: 8770 WEST BRYN MAWR AVENUE CITY: CHICAGO STATE: IL ZIP: 60631 8-K 1 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): December 17, 1997 NextLevel Systems, Inc. ----------------------- (Exact name of registrant as specified in its charter) Delaware 001-12925 36-4134221 -------- --------- ----------- (State or other jurisdiction of (Commission File No.) (I.R.S. Employer incorporation or organization) Identification No.) 8770 West Bryn Mawr Avenue, Chicago, Illinois 60631 ------------------------------------------------ ----- (Address of principal executive offices) (Zip Code) (773)-695-1000 -------------- (Registrant's telephone number, including area code) Item 5 Other Events The Registrant hereby incorporates the Amendment, dated as of December 16, 1997, to the Rights Agreement, dated as of June 12, 1997 (such amendment being Exhibit 4.1 attached hereto), and the description of the matters set forth in its press release dated December 17, 1997 (such press release being Exhibit 99.1 attached hereto). Item 7 Financial Statements and Exhibits (c) Exhibits 4.1 Amendment, dated as of December 16, 1997, to the Rights Agreement, dated as of June 12, 1997, between NextLevel Systems, Inc. and ChaseMellon Shareholder Services, L.L.C., as Rights Agent, filed as Exhibit 1 to the Company's Registration Statement on Form 8-A filed with the Commission on June 30, 1997 (File No. 001-12925) 99.1 The press release issued on December 17, 1997 by NextLevel Systems, Inc. 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. NextLevel Systems, Inc. By: /s/ Keith A. Zar ------------------------ Keith A. Zar Vice President and General Counsel December 17, 1997 - ----------------- Date EXHIBIT INDEX Sequential Page No. Exhibits No. - --- -------- ---------- 4.1 Amendment, dated as of December 16, 1997, 4 to the Rights Agreement, dated as of June 12, 1997, between NextLevel Systems, Inc. and ChaseMellon Shareholder Services, L.L.C., as Rights Agent, filed as Exhibit 1 to the Company's Registration Statement on Form 8-A filed with the Commission on June 30, 1997 (File No. 001-12925) 99.1 The press release issued on December 17, 1997 7 by NextLevel Systems, Inc. EX-4 2 Exhibit 4.1 AMENDMENT, dated as of December 16, 1997 (this "Amendment"), to RIGHTS AGREEMENT, dated as of June 12, 1997 (the "Rights Agreement"), between NextLevel Systems, Inc., a Delaware corporation (the "Company"), and ChaseMellon Shareholder Services, L.L.C., a New Jersey limited liability company ("Rights Agent"). WHEREAS, effective as of the date hereof, the Company and certain partnerships affiliated with Forstmann Little & Co. are entering into certain transactions (collectively, the "Transaction") with Tele-Communications, Inc., a Delaware corporation ("TCI"), pursuant to which TCI would acquire shares of capital stock, warrants to acquire shares of capital stock, and rights of first refusal with respect to transfers of common stock of the Company. WHEREAS, pursuant to Section 27 of the Rights Agreement, prior to the Distribution Date, the Company and the Rights Agent shall, if the Company so directs, supplement or amend any provision of the Rights Agreement without the approval of any holders of certificates representing Common Shares. WHEREAS, the Board of Directors of the Company deems it advisable to amend the Rights Agreement to specifically exempt from the operation thereof the Transaction. Accordingly, in consideration of the premises and the mutual agreements herein set forth, the parties hereby agree as follows: 1. All capitalized terms used in this Amendment and not otherwise defined herein shall have the meanings ascribed to them in the Rights Agreement. 2. Section 1(a) of the Rights Agreement is hereby amended by adding the following at the end thereof: "Notwithstanding the foregoing, the term "Acquiring Person" shall not include TCI and its Subsidiaries, for so long as (i) TCI and its Subsidiaries do not acquire Beneficial Ownership of any Common Shares other than pursuant to the Transaction and instruments and agreements forming part of the Transaction, or (ii) after giving effect to the acquisition of the Beneficial Ownership of any Common Shares by TCI or a Subsidiary of TCI other than pursuant to the Transaction, the Common Shares Beneficially Owned by TCI and its Subsidiaries in the aggregate do not exceed 35% of the then outstanding Common Shares. For purposes of the preceding sentence, TCI and its Subsidiaries shall not be deemed to Beneficially Own any Common Shares Beneficially Owned by their Affiliates and Associates (other than TCI and its Subsidiaries)." 3. Except as otherwise specifically provided herein, the Rights Agreement shall remain in full force and effect and be unaffected hereby. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and attested, all as of the date and year first above written. NEXTLEVEL SYSTEMS, INC. By: /s/ Keith A. Zar ---------------- Name: Keith A. Zar Title: Vice President and General Counsel CHASEMELLON SHAREHOLDER SERVICES, L.L.C., the Rights Agent By: /s/ James E. Hagan ------------------ Name: James E. Hagan Title: Vice President By: /s/ Julie Roh -------------- Name: Julie Roh Title: Relationship Manager EX-99 3 EXHIBIT 99.1 FOR IMMEDIATE RELEASE Media Contact: Dick Badler VP, Corporate Communications 773-695-1030 dbadler@nlvl.com Investor Contact: Mark Borman VP, Investor Relations 773-695-1150 mborman@nlvl.com NEXTLEVEL SYSTEMS TO SUPPLY AT LEAST 15 MILLION ADVANCED DIGITAL SET-TOP DEVICES TO CABLE OPERATORS MSOs To Become Shareholders In NextLevel, Which Will Change Name Back To General Instrument Breen Named Chairman and CEO Of General Instrument; Other Executives Named ------------------------------------------------------------------------------ CHICAGO, December 17, 1997 - NextLevel Systems, Inc. (NYSE: NLV) today announced that it has entered into long-term understandings worth a total of at least $4.5 billion over the next 3-5 years to supply at least 15 million advanced digital set-top devices to nine leading cable system operators (MSOs) under the industry's Open Cable specifications. The understandings reached by NextLevel, which is changing its name back to General Instrument Corporation, include commitments from MSOs representing about half of the entire cable industry. As part of these understandings, the MSOs will receive warrants to purchase approximately 16% of General Instrument equity at a price of approximately $15.00 per share. These warrants will vest only as set-top orders are actually shipped in the years 1998-2000. General Instrument will also acquire from Tele-Communications, Inc., in exchange for approximately 10% of General Instrument equity, the digital transport and authorization functions of TCI's Head End In The Sky (HITS) organization, providing the industry a secure platform to support widespread digital deployment. (more) These transactions are subject to completion of definitive documentation. In addition, GI intends to establish strategic partnerships with consumer electronics companies to pursue future digital technology development and retail distribution. Edward D. Breen, who was named the Company's President and Acting Chief Executive Officer on October 16, has been named Chairman and CEO of the new General Instrument Corporation and will become a member of the Board's Executive Committee. The Company also named three new officers: Eric M. Pillmore, Vice President, Finance and Acting Chief Financial Officer; Scott A. Crum, Vice President of Administration and Employee Resources; and Robert A. Scott, Vice President Legal and Secretary. The Company also announced other elements of its plan to improve financial performance and achieve the full strategic potential of its world-class communications technologies and market leadership positions. The plan, which was announced on October 16, 1997, includes: Cutting costs at its cable/satellite TV operations, including substantial job reductions at its San Diego and Puerto Rico satellite TV facilities and consolidation of its Chicago corporate headquarters into its Horsham, PA, cable TV facility, which will become the headquarters for General Instrument Corporation. The cost-cutting initiatives will result in annual earnings improvement of $0.05 to $0.07 per share beginning in 1998 for the new GI. Continuing to explore the establishment of the Company's advanced telephony operations, Next Level Communications, as an independent entity. The telephony unit will continue to do business as NextLevel Communications (NLC). The GI Board believes that NLC, which is deploying its NLevel(3) Switched Digital Access (SDA) system under contracts with Bell Atlantic and U S West, has created significant value that has not been recognized in the Company's stock price. The Board believes an eventual spin-off of NLC as a public company may be the best way to grow this business and increase shareholder value. The Company now expects 1998 earnings of $0.65 to $0.75 per share if after-tax losses in the NLC telephony unit can be excluded, compared to its October 16, 1997 announced range of $0.45 to $0.50 before corrective actions. The difference in expectations is the combination of the $0.05 to $0.07 per share in savings in the cable/satellite TV operations and exclusion of NLC after-tax losses of $23-28 million ($0.15 to $0.18 per share) in 1998. This unit is expected to record an after-tax loss of over $30 million ($0.20 per share) in 1997. (more) General Instrument expects to record after-tax charges of $65-100 million ($0.42 to $0.64 per share). These charges, related principally to the restructuring, will be incurred and recorded by the Company during the fourth quarter of 1997 and first quarter of 1998. "We have accomplished a great deal in the past 60 days to increase shareholder value and put our business on a growth track for the future," said Chairman and CEO Edward D. Breen. "We expect these transactions with the leading cable MSOs as both customers and shareholders to provide a strong foundation for our business, accelerate deployment of new consumer services, make Open Cable a reality and reinforce our market leadership position in the next generation of technology. We are deeply honored to become partners with so many fine companies." General Instrument's cable/satellite TV business is the world leader in both analog and digital systems that provide video, audio and high-speed Internet/data services over cable television and satellite networks. The cable/satellite TV operations have approximately 7,000 employees and annual sales of approximately $1.8 billion. The telephony business is a start-up with 300 employees that reported its first $3 million of revenues in the most recent quarter. To improve the cost structure of cable/satellite TV operations, GI since October 16, 1997 has announced a 16% reduction in headcount through the elimination of 225 positions in its San Diego-based satellite operations (completed); the closing of its Puerto Rican satellite receiver manufacturing facility and the elimination of its 1,100 positions (to be completed by the end of 1997); and the elimination of 20 positions as a result of moving its corporate headquarters from Chicago to Horsham, PA (to be completed in the first quarter of 1998). The General Instrument name was chosen for the cable/satellite TV business based on its strong brand equity in these businesses. Next Level Communications will retain its name, which is associated in the market as a leader in next-generation digital telephone access systems. As a result of the name change, it is expected that the Company's ticker symbol on the New York Stock Exchange will be changed from NLV to GIC on or about February 2, 1998. # # # The information set forth above includes "forward-looking" information and, accordingly, the cautionary statements contained in Exhibit 99, under the caption "Forward-Looking Information" in NextLevel System's quarterly report on Form 10-Q, for the three months ended September 30, 1997, are incorporated herein by reference. NextLevel Systems' actual results could differ materially from the "forward-looking" information in this press release. -----END PRIVACY-ENHANCED MESSAGE-----