UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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):
May 8, 2013
OUTDOOR CHANNEL HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
| DELAWARE | 000-17287 | 33-0074499 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
43455 Business Park Drive
Temecula, California 92590
(Address of principal executive offices, including zip code)
(951) 699-6991
(Registrant’s telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01 Entry into a Material Definitive Agreement
Second Amendment to Merger Agreement
On May 8, 2013, Outdoor Channel Holdings, Inc. (“Outdoor Channel”) entered into Amendment No. 2 to the Agreement and Plan of Merger by and among Outdoor Channel, Kroenke Sports & Entertainment, LLC (“KSE”) and KSE Merger Sub, Inc.(the “Second Amendment”). The Second Amendment modifies the previously announced Agreement and Plan of Merger, dated as of March 13, 2013, which was previously amended on May 2, 2013 (as amended, the “Merger Agreement”).
Outdoor Channel’s board of directors unanimously approved the Second Amendment and recommended that the Outdoor Channel stockholders vote to adopt the Merger Agreement at the special meeting of Outdoor Channel stockholders.
The Second Amendment increases the consideration to be paid to Outdoor Channel’s stockholders for their shares of Outdoor Channel common stock if the merger is completed to $10.25 per share in cash from $9.35 per share in cash. Additionally, under the terms of the Second Amendment, the termination fee that Outdoor Channel will be required to pay KSE upon termination of the amended merger agreement under specified circumstances, including termination by KSE in the event that the Outdoor Channel board of directors changes its recommendation and no longer recommends that the Outdoor Channel stockholders vote in favor of the adoption of the amended merger agreement, has been increased to $7.5 million from $1 million. Further, under the Second Amendment, the Outdoor Channel board cannot terminate the Merger Agreement for a Superior Proposal (as defined in the Merger Agreement), but instead Outdoor Channel must, unless KSE agrees otherwise, submit a proposal for the adoption of the Merger Agreement at a special meeting of the Outdoor Channel stockholders, even in the event of a change of board recommendation.
The foregoing description of the Second Amendment is qualified in its entirety by the full text of the Second Amendment attached hereto as Exhibit 2.1, which is incorporated herein by reference.
Amendment to Support Agreement
Concurrently with the execution of the Second Amendment, Thomas H. Massie, Perry T. Massie and certain of their affiliated entities (the “Massie Parties”), the members of the Outdoor Channel Board of Directors and the executive officers of Outdoor Channel, collectively representing approximately 41% of the outstanding Outdoor Channel common stock (collectively, the “Supporting Parties”), entered into an amendment to the support agreement (the “Support Agreement Amendment) previously entered into by such parties with KSE on March 13, 2013 (as amended, the “Support Agreement”). Under the terms of the Support Agreement, the Supporting Parties agreed, among other things, to vote their shares of Outdoor Channel common stock: (i) in favor of the adoption of the Merger Agreement, the merger and the other transactions contemplated by the Merger Agreement; (ii) in favor of any proposal to adjourn or postpone any meeting of the Outdoor Channel stockholders if there are not sufficient votes for approval of the matters described in the preceding clause (i); and (iii) except with the written consent of KSE, against (x) any Alternative Proposal (as defined in the Merger Agreement) with respect to Outdoor Channel that would impede the merger or (y) any other action or proposal involving Outdoor Channel (or any subsidiary of Outdoor Channel) that would reasonably be expected to prevent or materially impede, interfere with or delay the merger. The Support Agreement Amendment amended the Support Agreement to provide that the Supporting Parties will have no right to terminate the Support Agreement and will continue to be bound by their obligations thereunder, including their voting obligations described in the immediately foregoing sentence, in the event that the Outdoor Channel board of directors changes its recommendation.
The foregoing description of the Support Agreement Amendment is qualified in its entirety by the full text of the Support Agreement Amendment attached hereto as Exhibit 99.1, which is incorporated herein by reference.
Item 8.01 Other Events
On May 8, 2013, Outdoor Channel issued a press release announcing entry into the Second Amendment and the Outdoor Channel board of directors’ recommendation that Outdoor Channel stockholders vote to approve the adoption of the Merger Agreement at the special meeting of Outdoor Channel stockholders.
Outdoor Channel also confirmed that its special meeting of stockholders has been adjourned and that Outdoor Channel anticipates that the special meeting will be held next week. The location of the reconvened special meeting will remain Outdoor Channel’s facilities located at 43455 Business Park Drive in Temecula, California.
A copy of the press release is attached hereto as Exhibit 99.2 and incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits
| (d) | Exhibits. |
| Exhibit |
Description | |
| 2.1 | Amendment No.2, dated as of May 8, 2013, to the Agreement and Plan of Merger dated March 13, 2013, as amended, by and among Kroenke Sports & Entertainment, LLC, KSE Merger Sub, Inc. and Outdoor Channel Holdings, Inc. | |
| 99.1 | Amendment No. 1 to Support Agreement dated as of March 13, 2013, by and among KSE, the Massie Parties and each of the directors and executive officers of Outdoor Channel | |
| 99.2 | Press Release, issued by Outdoor Channel, Holdings, Inc., dated May 8, 2013 | |
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.
| OUTDOOR CHANNEL HOLDINGS, INC. | ||
| Date: May 8, 2013 | /s/ Catherine C. Lee | |
| Catherine C. Lee | ||
| Exec. VP, General Counsel and Corporate Secretary | ||
INDEX TO EXHIBITS
| Exhibit |
Description | |||
| 2.1 | Amendment No.2, dated as of May 8, 2013, to the Agreement and Plan of Merger dated March 13, 2013, as amended, by and among Kroenke Sports & Entertainment, LLC, KSE Merger Sub, Inc. and Outdoor Channel Holdings, Inc. | |||
| 99.1 | Amendment No. 1to Support Agreement dated as of March 13, 2013, by and among KSE, the Massie Parties and each of the directors and executive officers of Outdoor Channel | |||
| 99.2 | Press Release, issued by Outdoor Channel, Holdings, Inc., dated May 8, 2013 | |||
Exhibit 2.1
AMENDMENT NO. 2 TO AGREEMENT AND PLAN OF MERGER
THIS AMENDMENT NO. 2 (this “Amendment No. 2”), dated as of May , 2013, to the Agreement and Plan of Merger, dated as of March 13, 2013, as amended (the “Merger Agreement”), is made by and among Kroenke Sports & Entertainment, LLC, a Delaware limited liability company (“Parent”), KSE Merger Sub, Inc., a Delaware corporation and a direct wholly-owned Subsidiary of Parent (“Merger Sub”), and Outdoor Channel Holdings, Inc., a Delaware corporation (“OUTD”). All capitalized terms that are used but not defined in this Amendment No. 2 shall have the respective meanings ascribed thereto in the Merger Agreement.
W I T N E S S E T H:
WHEREAS, Section 9.13 of the Merger Agreement provides for the amendment of the Merger Agreement in accordance with the terms set forth therein;
WHEREAS, the Parent Members and the Board of Directors of each of Merger Sub and OUTD have approved the consummation of the business combination provided for in the Merger Agreement as amended by this Amendment No. 2;
WHEREAS, the Parent Members have (i) determined that it is in the best interests of Parent and its members to amend the Merger Agreement as set forth in this Amendment No. 2 and (ii) approved this Amendment No. 2, the execution and delivery of this Amendment No. 2 and the performance by Parent and Merger Sub of the Merger Agreement as amended by this Amendment No. 2 and the consummation of the transactions contemplated thereby;
WHEREAS, the OUTD Board has (i) determined that it is in the best interests of OUTD and its stockholders, and declared it advisable, to enter into this Amendment No. 2 (ii) approved this Amendment No. 2, the execution and delivery of this Amendment No. 2 and the performance by OUTD of the Merger Agreement as amended by this Amendment No. 2 and the consummation of the transactions contemplated thereby, including the Merger, and (iii) resolved to reaffirm the OUTD Board Recommendation;
WHEREAS, the Board of Directors of Merger Sub has (i) determined that it is in the best interests of Merger Sub and its sole stockholder, and declared it advisable, to enter into this Amendment No. 2 and (ii) approved Amendment No. 2, the execution and delivery of this Amendment No. 2 and the performance by Merger Sub of the Merger Agreement as amended by this Amendment No. 2 and the consummation of the transactions contemplated thereby, including the Merger; and
WHEREAS, concurrently with the execution and delivery of this Amendment No. 2, Parent and certain stockholders of OUTD that are currently parties to the Support Agreement are entering into Amendment No. 1 to the Support Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Parent, Merger Sub and OUTD agree as follows:
ARTICLE I
AMENDMENT TO MERGER AGREEMENT
Section 1.1. Merger Consideration. Section 2.1(a) of the Merger Agreement is hereby amended by replacing, in the definition of Merger Consideration set forth therein, the reference to “$9.35” with “$10.25”.
Section 1.2. No Solicitation. Section 6.1(d) of the Merger Agreement is hereby replaced in its entirety with the following:
“(d) (i) If a material event, fact, change, development or set of circumstances, in each case, that relates to OUTD, Parent or the transactions contemplated hereby, but does not relate to any Alternative Proposal and which first becomes known to the OUTD Board after the date hereof (or if known, the magnitude or material consequences of which were not known or understood by the OUTD Board as of the date hereof) and prior to obtaining the OUTD Stockholder Approval (an “Intervening Event”) or (ii) if OUTD receives an Alternative Proposal which the OUTD Board concludes in good faith, after consultation with outside legal counsel and financial advisors, constitutes a Superior Proposal after giving effect to all of the adjustments to the terms of this Agreement which may be offered by Parent in accordance with this Section 6.1(d), then, in each case, the OUTD Board may at any time prior to obtaining the OUTD Stockholder Approval, if it determines in good faith, after consultation with outside legal counsel, that not taking such action would be inconsistent with the fiduciary duties of the OUTD Board to the OUTD stockholders under applicable Law withdraw, modify or qualify, or propose publicly to withdraw, modify or qualify, in a manner adverse to Parent, the OUTD Board Recommendation (a “Board Recommendation Change”); provided that the OUTD Board may not make a Board Recommendation Change pursuant to the foregoing unless:
(i) Subject to Section 6.4(c), the OUTD Board shall have first provided at least four (4) Business Days prior written notice (a “Notice”) to Parent that it is prepared to take the applicable action in response to an Intervening Event or a Superior Proposal, as applicable, which notice shall (i) describe such Intervening Event or Superior Proposal, as applicable, in reasonable detail, and (ii) in the case of a Superior Proposal, be accompanied by the most current version of all relevant written agreements or proposals relating to the transaction that constitute such Superior Proposal (it being agreed that the Notice and any amendment or update to such Notice and the determination to so deliver such Notice, or update or amend public disclosures with respect thereto shall not constitute a Board Recommendation Change for purposes of this Agreement); and
(ii) Parent does not make, within such four-Business Day period, a binding, written, irrevocable offer to modify the terms of this Agreement that would, in the good faith judgment of the OUTD Board (after consultation with outside legal counsel and financial advisors), cause the Alternative Proposal previously constituting a Superior Proposal to no longer constitute a Superior Proposal or that would obviate the need to make a Board Recommendation Change in the event of an Intervening Event, as applicable, in each case, taking into consideration any risk of non-consummation and all legal, financial, regulatory and other aspects of such proposal. OUTD agrees that, during the four-
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Business Day period prior to its effecting a Board Recommendation Change, OUTD and its Representatives shall negotiate in good faith with Parent and its Representatives regarding any revisions to the terms of the transactions contemplated hereunder such that the Alternative Proposal in question no longer constitutes a Superior Proposal or that would obviate the need to make a Board Recommendation Change in the event of an Intervening Event. Each successive modification to the price or any other material term of any Alternative Proposal shall constitute a new Acquisition Proposal for purposes of this Section 6.1(d) and shall, subject to Section 6.4(c), require a new Notice under Section 6.1(d)(i), if applicable; provided, that, the Notice period shall be shortened in such case from four (4) Business Days to three (3) Business Days, and each reference to four (4) Business Days or a four (4)-Business Day period in this Section 6.1(d) shall be deemed to be three (3) Business Days or a three (3)-Business Day period, as applicable.”
Section 1.3. OUTD Stockholders’ Meeting. Section 6.4 is hereby deleted in its entirety and replaced with the following:
“Section 6.4. OUTD Stockholders’ Meeting.
(a) Subject to Section 6.4(b), OUTD shall convene the OUTD Stockholders’ Meeting to consider and vote upon the approval of the Transaction and to cause such vote to be taken no later than May 14, 2013, at 9:00 a.m., Pacific Time, at OUTD’s facilities located at 43455 Business Park Drive, Temecula, California 92590.
(b) Notwithstanding anything in this Agreement to the contrary, OUTD may, with the prior written consent of Parent (which consent shall not be unreasonably withheld, conditioned or delayed), postpone or adjourn the OUTD Stockholders’ Meeting (i) to solicit additional proxies for the purpose of obtaining the OUTD Stockholder Approval, (ii) for the absence of quorum or (iii) to allow such additional time for the filing and/or mailing of any supplemental or amended disclosure which OUTD has determined, based on the advice of outside legal counsel, is required under applicable Law and for such supplemental or amended disclosure to be disseminated and reviewed by the stockholders of OUTD prior to the OUTD Stockholders’ Meeting.
(c) If OUTD shall have delivered the Notice contemplated by Section 6.1(d) and the time periods contemplated by Section 6.1(d)(i) and (ii) will not expire prior to the date of the OUTD Stockholders’ Meeting, then OUTD may, with the prior written consent of Parent (which consent shall be granted or withheld in Parent’s sole discretion) postpone or adjourn the OUTD Stockholders’ Meeting only for such amount of time as is necessary to permit the time periods contemplated by Section 6.1(d) to expire; provided, however, that if Parent does not grant such consent, then the OUTD board shall have the right, subject to the other terms and conditions of Section 6.1, to make a Board Recommendation Change on the Business Day prior to, or on the date of, the OUTD Stockholder Meeting, notwithstanding the fact that the applicable time periods of Section 6.1(d) shall not have expired.”
Section 1.4. Termination. Section 8.1(e) of the Merger Agreement is hereby deleted in its entirety and replaced with the following:
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“(e) RESERVED”
Section 1.5. Termination Fee. Section 8.3(a) of the Merger Agreement is hereby amended by replacing, in the definition of the Termination Fee set forth therein, the reference to “$1,000,000” with “$7,500,000” and by deleting Section 8.3(a)(i) in its entirety and replacing it with the following:
“(i) RESERVED”
Section 1.6. Termination Fee. Section 8.3(b) of the Merger Agreement is hereby deleted in its entirety and replaced with the following:
“(b) OUTD shall pay the Termination Fee by wire transfer of immediately available funds (i) within two (2) Business Days following the termination of this Agreement in the case of Section 8.3(a)(ii) and (ii) within two Business Days of the event giving rise to the payment of the Termination Fee in the case of Section 8.3(a)(iii). For the avoidance of doubt, any payment to be made by OUTD under this Section 8.3 shall be payable only once to Parent with respect to this Section 8.3 and not in duplication even though such payment may be payable under one or more provisions hereof.”
ARTICLE II
GENERAL PROVISIONS
Section 2.1. No Further Amendment. Except as expressly amended hereby, the Merger Agreement is in all respects ratified and confirmed and all the terms, conditions, and provisions thereof shall remain in full force and effect. This Amendment No. 2 is limited precisely as written and shall not be deemed to be an amendment to any other term or condition of the Merger Agreement or any of the documents referred to therein.
Section 2.2. Effect of Amendment. This Amendment No. 2 shall form a part of the Merger Agreement for all purposes, and each party thereto and hereto shall be bound hereby. From and after the execution of this Amendment No. 2 by the parties hereto, any reference to the Merger Agreement shall be deemed a reference to the Merger Agreement as amended hereby.
Section 2.3. Counterparts. This Amendment No. 2 may be executed in two or more counterparts, each of which when executed shall be deemed to be an original, and all of which together will be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties. For purposes of this Amendment No. 2, facsimile signatures or signatures by other electronic form of transfer shall be deemed originals, and the parties agree to exchange original signatures as promptly as possible.
Section 2.4. Governing Law. This Amendment No. 2 and any claim, controversy or dispute arising under or related thereto, the relationship of the parties, and/or the interpretation and enforcement of the rights and duties of the parties, whether arising in Law or in equity, in contract, tort or otherwise, shall be governed by, and construed and interpreted in accordance
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with, the Laws of the State of Delaware, without regard to its rules regarding conflicts of Law to the extent that the application of the Laws of another jurisdiction would be required thereby.
Section 2.5. Severability. If any term or other provision of this Amendment No. 2 is held to be invalid, illegal or incapable of being enforced by any rule of Law or public policy by a court of competent jurisdiction, all other conditions and provisions of this Amendment No. 2 shall nevertheless remain in full force and effect, insofar as the foregoing can be accomplished without materially affecting the economic benefits anticipated by the parties to this Amendment No. 2. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Amendment No. 2 so as to effect the original intent of the parties as closely as possible to the fullest extent permitted by applicable Law in an acceptable manner to the end that the Transaction is fulfilled to the extent possible.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to be executed by their respective officers thereunto duly authorized, all as of the date first written above.
| KROENKE SPORTS & ENTERTAINMENT, LLC | ||
| By: | /s/ James A. Martin | |
| Name: | James A. Martin | |
| Title: | President and Chief Executive Officer | |
| KSE MERGER SUB, INC. | ||
| By: | /s/ James A. Martin | |
| Name: | James A. Martin | |
| Title: | President | |
| OUTDOOR CHANNEL HOLDING, INC. | ||
| By: | /s/ Perry T. Massie | |
| Name: | Perry T. Massie | |
| Title: | Co-Chairman of the Board of Directors | |
[Signature Page to Amendment No. 2]
Exhibit 99.1
AMENDMENT NO. 1 TO SUPPORT AGREEMENT
This AMENDMENT NO. 1 (this “Amendment No. 1”), dated as of May , 2013, to the Support Agreement, dated as of March 13, 2013 (the “Agreement”), is made by and among the individuals listed on Schedule I of the Agreement (collectively, the “Supporting Parties”) and Kroenke Sports & Entertainment, LLC, a Delaware limited liability company (“Parent”, and together with the Supporting Parties, the “Parties”). All capitalized terms that are used but not defined in this Amendment No. 1 shall have the respective meanings ascribed thereto in the Agreement.
WHEREAS, Section 6.4 of the Agreement provides for the amendment of the Agreement in accordance with the terms set forth therein;
WHEREAS, as of the date hereof, each Supporting Party is the Beneficial Owner (as defined herein) of the number of OUTD Shares set forth opposite such Supporting Party’s name on Schedule I of the Agreement; and
WHEREAS, concurrently with the execution and delivery of this Amendment No. 1, Parent, OUTD and Merger Sub are entering into Amendment No. 2 to the Merger Agreement.
NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the Parties hereto agree as follows:
ARTICLE I
AMENDMENT TO SUPPORT AGREEMENT
Section 1.1 Amendment to Section 2.1 of the Agreement. Section 2.1 of the Agreement is hereby amended to incorporate the following two sentences.
Anything herein to the contrary notwithstanding, this Section 2.1 shall not require any Supporting Party to appear at any meeting, in person or by proxy, or vote (or cause to be voted) any of its Covered OUTD Shares to adopt an amendment to the Merger Agreement or take any action that results or could result in the adoption of an amendment or modification, or a waiver of a provision therein, in any such case, in a manner that (i) decreases the amount or changes the form of the Merger Consideration or (ii) imposes any material restrictions on or additional conditions on the payment of the Merger Consideration to stockholders. For the avoidance of doubt, references to the “Merger Agreement” herein refer to the Merger Agreement as amended by Amendment No. 2 thereto.
Section 1.2 Amendment to Section 6.2(a) of the Agreement. Section 6.2(a) of the Agreement is hereby amended to delete the following sentence, and each Supporting Party expressly and irrevocably waives any right to terminate the Agreement pursuant to such sentence:
In addition to the foregoing, this Agreement may be terminated by the Supporting Parties upon written notice to Parent at any time following a Board Recommendation Change in compliance with Section 6.1(d) of the Merger Agreement.
ARTICLE II
MISCELLANEOUS
Section 2.1 No Further Amendment. Except as expressly amended hereby, the Agreement is in all respects ratified and confirmed and all the terms, conditions, and provisions thereof shall remain in full force and effect. This Amendment No. 1 is limited precisely as written and shall not be deemed to be an amendment to any other term or condition of the Agreement or any of the documents referred to therein.
Section 2.2 Effect of Amendment. This Amendment No. 1 shall form a part of the Agreement for all purposes, and each party thereto and hereto shall be bound hereby. From and after the execution of this Amendment No. 2 by the parties hereto, any reference to the Agreement shall be deemed a reference to the Agreement as amended hereby.
Section 2.3 Governing Law. This Amendment No. 1 and any claim, controversy or dispute arising under or related thereto, the relationship of the Parties and/or the interpretation and enforcement of the rights and duties of the Parties, whether arising in Law or in equity, in contract, tort or otherwise, shall be governed by, and construed and interpreted in accordance with, the Laws of the State of Delaware, without regard to its rules regarding conflict of laws to the extent that the application of the Laws of another jurisdiction would be required thereby.
Section 2.4 Severability. If any term or other provision of this Amendment No. 1 is held to be invalid, illegal or incapable of being enforced by any rule of Law or public policy by a court of competent jurisdiction, all other conditions and provisions of this Amendment No. 1 shall nevertheless remain in full force and effect, insofar as the foregoing can be accomplished without materially affecting the economic benefits anticipated by the Parties to this Amendment No. 1. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Amendment No. 1 so as to effect the original intent of the Parties as closely as possible to the fullest extent permitted by applicable Law in an acceptable manner to the end that the transactions contemplated by this Amendment No. 1 are fulfilled to the extent possible.
Section 2.5 Counterparts. This Amendment No. 1 may be executed in two or more counterparts, each of which when executed shall be deemed to be an original, and all of which together shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the Parties and delivered to the other Parties. For purposes of this Amendment No. 1, facsimile signatures or signatures by other electronic form of transfer shall be deemed originals, and the Parties agree to exchange original signatures as promptly as possible.
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IN WITNESS WHEREOF, the Parties have executed this Amendment No. 1 as of the date first written above.
| SUPPORTING PARTY | ||
| By: |
| |
| Name: | ||
| Title: | ||
| Address: | ||
[Signature Page to Amendment No. 1 to Support Agreement]
| KROENKE SPORTS & ENTERTAINMENT, LLC | ||
| By: | /s/ James A. Martin | |
| Name: | James A. Martin | |
| Title: | President and Chief Executive Officer | |
[Signature Page to Amendment No. 1 to Support Agreement]
Exhibit 99.2
OUTDOOR CHANNEL AGREES TO INCREASE TO $10.25 PER SHARE IN TRANSACTION WITH KROENKE SPORTS & ENTERTAINMENT
TEMECULA, Calif.—May 8, 2013—Outdoor Channel Holdings, Inc. (NASDAQ: OUTD) (the “Company” or “Outdoor Channel”) today announced that it entered into a second amendment to its merger agreement dated March 13, 2013 with Kroenke Sports & Entertainment, LLC (“KSE”), which was previously amended on May 2, 2013. Under the terms of the amended merger agreement, the merger consideration has been increased to $10.25 per share in cash (compared to the previously agreed consideration of $9.35 per share).
Outdoor Channel’s board of directors determined that this second amendment has caused the May 3rd InterMedia proposal of $9.75 per share to no longer constitute a Superior Proposal (as defined in the merger agreement with KSE, as amended). Outdoor Channel’s board of directors unanimously approved the second amendment to the merger agreement and recommends that Outdoor Channel’s stockholders vote to adopt the amended merger agreement at the special meeting of Outdoor Channel stockholders, which the Outdoor Channel board of directors anticipates will be held next week.
Under the terms of the amended merger agreement, the termination fee that Outdoor Channel will be required to pay KSE upon termination of the amended merger agreement under specified circumstances, including termination by KSE in the event that the Outdoor Channel board of directors changes its recommendation and no longer recommends that the Outdoor Channel stockholders vote in favor of the adoption of the amended merger agreement, has been increased to $7.5 million (approximately 2.8% of the equity value of the transaction) from $1 million. Additionally, under the amended merger agreement, the Outdoor Channel board cannot terminate the merger agreement for a Superior Proposal, but instead Outdoor Channel must, unless KSE agrees otherwise, submit a proposal for the adoption of the amended merger agreement at a special meeting of the Outdoor Channel stockholders, even in the event of a change of board recommendation.
In connection with the amendment of the merger agreement, Thomas H. Massie, Perry T. Massie and certain of their affiliated entities and the members of Outdoor Channel’s board of directors and the executive officers of Outdoor Channel, who collectively hold approximately 41% of the outstanding shares of Outdoor Channel common stock, agreed to amend the terms of the support agreements previously entered into by them with KSE to require such parties to vote in favor of the adoption of the amended merger agreement even if Outdoor Channel’s board of directors changes its recommendation.
Outdoor Channel will file with the U.S. Securities and Exchange Commission a supplement to the definitive proxy statement, dated April 10, 2013, that will describe the revisions to the merger agreement, including, among other things, the increase in the consideration, termination rights and voting requirements described above.
Outdoor Channel stockholders who have already submitted a proxy with respect to the KSE transaction do not need to take any action. However, if Outdoor Channel stockholders wish to change their previous vote, they may revoke their proxy and change their vote any time before the close of the vote of the special meeting. For instructions on how to change your vote prior to the special meeting, please refer to the definitive proxy statement.
Lazard is serving as exclusive financial advisor to Outdoor Channel in connection with the transaction. Wilson Sonsini Goodrich & Rosati, P.C. is legal advisor to Outdoor Channel in connection with the transaction.
About Outdoor Channel Holdings, Inc.
Outdoor Channel Holdings, Inc. owns and operates Outdoor Channel and Winnercomm Inc. Nielsen estimated that Outdoor Channel had approximately 39.8 million cable, satellite and telco subscribers for May 2013. Outdoor Channel offers programming that captures the excitement of hunting, fishing, shooting, adventure and the Western lifestyle and can be viewed on multiple platforms including high definition, video-on-demand, as well as on a dynamic broadband website. Winnercomm is one of America’s leading and highest quality producers of live sporting events and sports series for cable and broadcast television. The Company also owns and operates the SkyCam and CableCam aerial camera systems which provide dramatic overhead camera angles for major sports events, including college and NFL football.
Safe Harbor Statement
Certain matters discussed in this news release, with the exception of historical matters, may be forward- looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by words such as “anticipates,” “estimates,” “expects,” “believes,” “plans,” “predicts,” and similar terms. These statements are subject to a number of risks and uncertainties that could cause results to differ materially from those anticipated as of the date of this release. You should understand that the following important factors, in addition to those risk factors disclosed in the Company’s current and periodic reporting filed with the SEC could affect the future results of the Company and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements:
| • | failure of Company stockholders to adopt the amended merger agreement; |
| • | the risk that the other conditions to closing of the merger may not be satisfied; |
| • | that Outdoor Channel will not be able to terminate the amended merger agreement in the event that the Outdoor Channel board of directors changes its recommendation to the Outdoor Channel stockholders and no longer recommends that the Outdoor Channel stockholders vote in favor of the KSE transaction; |
| • | the risk that the merger may not be consummated by the expected closing date of the merger or at all; |
| • | litigation in respect of the merger; and |
| • | disruption from the merger making it more difficult to maintain certain strategic relationships. |
The Company also cautions the reader that undue reliance should not be placed on any forward-looking statements, which speak only as of the date of this release. The Company undertakes no duty or responsibility to update any of these forward-looking statements to reflect events or circumstances after the date of this report or to reflect actual outcomes.
IMPORTANT INFORMATION FOR INVESTORS AND SECURITYHOLDERS
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This communication is being made in respect of a proposed business combination involving Outdoor Channel and KSE. In connection with this proposed transaction Outdoor Channel plans to file with the SEC and furnish to its stockholders a proxy statement. The proxy statement will contain important information about the proposed transaction and related matters.
OUTDOOR CHANNEL URGES INVESTORS TO CAREFULLY READ IN ITS ENTIRETY THE DEFINITIVE PROXY STATEMENT AND OTHER DOCUMENTS INCLUDED AND INCORPORATED BY REFERENCE THEREIN AS THEY ARE MADE AVAILABLE TO OUTDOOR CHANNEL STOCKHOLDERS BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER.
Investors and security holders will be able to obtain free copies of the proxy statement when made available and other documents filed with the SEC by Outdoor Channel through the web site maintained by the SEC at www.sec.gov. Free copies of the proxy statement when made available and other documents filed with the SEC can also be obtained on Outdoor Channel’s website at www.outdoorchannel.com.
PROXY SOLICITATION
Outdoor Channel and its respective directors, executive officers and certain other members of management and employees may be soliciting proxies from Outdoor Channel stockholders in favor of the merger. When made available, a description of the interest of Outdoor Channel’s directors and executive officers in Outdoor Channel will be set forth in the proxy statement and the other documents included and incorporated by reference therein. You can find information about Outdoor Channel’s executive officers and directors in its annual report on Form 10-K filed with the SEC on March 18, 2013. You can obtain free copies of these documents from Outdoor Channel in the manner set forth above.
CONTACT: For Company:
Tom Allen
Executive Vice President, Chief Operating Officer/
Chief Financial Officer
800-770-5750
tallen@outdoorchannel.com
For Investors:
Brad Edwards
Brainerd Communicators, Inc.
212-986-6667
edwards@braincomm.com
For Media:
Nancy Zakhary
Brainerd Communicators, Inc.
212-986-6667
nancy@braincomm.com
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