SC 13D/A
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
Under the Securities Exchange Act of 1934
(Amendment No. 1 )*
(Name of Issuer)
Class
A Common Stock, par value $0.01 per share
(Title of Class of Securities)
(CUSIP Number)
Frank
J. Marinaro, Esq.
Merrill Lynch & Co., Inc.
4 World Financial Center
250 Vesey Street
New York, New York 10080
Telephone: (212) 449-1000
Merrill Lynch, Pierce, Fenner & Smith Incorporated
4 World Financial Center
250 Vesey Street
New York, New York 10080
Telephone: (212) 449-1000
with a copy to:
Stephen R. Hertz, Esq.
Debevoise & Plimpton LLP
919 Third Ave
New York, NY
10022
Telephone: (212) 909-6453
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o
Note: Schedules filed
in paper format shall include a signed original and five copies of
the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting persons initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed to be filed for the purpose of Section 18 of the Securities Exchange Act of 1934 (Act) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
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NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Merrill Lynch, Pierce, Fenner & Smith Incorporated |
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
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(a) o |
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(b) þ |
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SEC USE ONLY |
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SOURCE OF FUNDS |
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OO |
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) |
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þ |
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CITIZENSHIP OR PLACE OF ORGANIZATION |
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Delaware
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SOLE VOTING POWER |
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NUMBER OF |
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0 shares |
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SHARES |
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SHARED VOTING POWER |
BENEFICIALLY |
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OWNED BY |
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123,602 shares |
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EACH |
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SOLE DISPOSITIVE POWER |
REPORTING |
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PERSON |
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0 shares |
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WITH |
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SHARED DISPOSITIVE POWER |
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123,602 shares |
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
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123,602 shares |
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) |
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Less than 1% |
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TYPE OF REPORTING PERSON |
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BD, IA, CO |
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NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Merrill Lynch & Co., Inc. |
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
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(a) o |
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(b) þ |
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SEC USE ONLY |
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SOURCE OF FUNDS |
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OO |
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) |
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þ |
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CITIZENSHIP OR PLACE OF ORGANIZATION |
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Delaware
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SOLE VOTING POWER |
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NUMBER OF |
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0 shares |
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SHARES |
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SHARED VOTING POWER |
BENEFICIALLY |
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OWNED BY |
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123,602 shares |
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EACH |
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SOLE DISPOSITIVE POWER |
REPORTING |
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PERSON |
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0 shares |
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WITH |
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SHARED DISPOSITIVE POWER |
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123,602 shares |
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
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123,602 shares |
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) |
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Less than 1% |
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TYPE OF REPORTING PERSON |
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HC, CO |
3
TABLE OF CONTENTS
SCHEDULE 13D
Explanatory Note
This Amendment No. 1 to Schedule 13D amends and supplements the statement on Schedule 13D
originally filed by Merrill Lynch, Pierce, Fenner & Smith Incorporated and Merrill Lynch & Co.,
Inc. on July 30, 2007.
Item 2. Identity and Background
Item 2 is hereby amended and supplemented as follows:
The previously filed Schedule II and Schedule III are deleted in their
entirety and replaced with the attached Schedule II and Schedule III.
Item 4. Purpose of Transaction
Item 4 is hereby amended and supplemented as follows:
On May 11, 2008, Parent, Merger Sub, ML IBK and the Company entered into a Termination
Agreement and Release (the Merger Termination Agreement) relating to the Merger
Agreement, as a result of which the parties thereto terminated the Merger Agreement.
The
Merger Termination Agreement provides, among other things, (i) that the Merger Agreement and other transaction-related documents are terminated,
(ii) that Parent will promptly pay, or cause to be paid, to the Company $15 million in cash, (iii)
that each party mutually releases the other parties and their respective employees, affiliates,
representatives or agents from any claims for actions by the parties with respect to the Merger
Agreement and other transaction-related documents, and (iv) to certain provisions with respect to
confidentiality, non-disparagement and publicity. The Merger
Termination Agreement also acknowledges that the Debt Financing
Commitment is terminated pursuant to a separate letter agreement by
and among the parties to the Debt Financing Commitment.
4
A
copy of the Merger Termination Agreement is attached as
Exhibit 99.18 to this
Statement and is incorporated by reference herein.
In connection with the termination of the Merger Agreement, on May 11, 2008, MLGPE Fund, the
Rollover Investors, Holdco and Parent entered into a Termination Agreement and Release (the
IIA Termination Agreement) relating to the Interim Investors Agreement, as a result of
which the parties thereto terminated the Interim Investors Agreement.
The IIA Termination Agreement provides, among other things, that if, within the two years
following the execution of the IIA Termination Agreement, Lewis W. Dickey, Jr. or certain other
Rollover Investors reasonably anticipate that he or they will pursue or participate in specified
transactions, which transactions include but are not limited to a Company going private
transaction, such Rollover Investor(s) will notify MLGPE Fund of such intention, provide MLGPE Fund
with certain information about such transaction and, if so requested by MLGPE Fund, engage in good
faith negotiations with MLGPE Fund (or an affiliate of MLGPE Fund) with a goal of facilitating
MLGPE Funds (or such affiliates) participation in such transaction.
A
copy of the IIA Termination Agreement is attached as
Exhibit 99.19 to this Statement
and is incorporated by reference herein.
The information set forth in response to this Item 4 is qualified in its entirety by reference
to the Merger Termination Agreement and the IIA Termination Agreement, each of which is filed as an
exhibit hereto and is incorporated by reference herein.
Item 5. Interest in Securities of the Issuer
Item 5 is hereby amended and restated in its entirety to read as follows:
MLPF&S is the beneficial owner of approximately 123,602 shares of Common Stock, with respect
to which it has shared voting and investment power, and which represent less than 1% of all shares
of Common Stock outstanding (based on the number of 37,502,718 shares of Common Stock and 644,871
shares of the Companys Class C common stock, par value $.01 per share (the Class C Common
Stock) outstanding as of April 30, 2008 as represented by the Company in its quarterly report on Form 10-Q for the period ended March, 31 2008.
ML&Co is the beneficial owner of approximately 123,602 shares of Common Stock, with respect to
which it has shared voting and investment power, and which represent less than 1% of all shares of
Common Stock outstanding (based on the number of 37,502,718 shares of Common Stock and 644,871
shares of Class C Common Stock outstanding as of April 30, 2008 as represented by the Company in
its quarterly report on Form 10-Q for the period ended March, 31 2008.
None of the Common Stock reported in this Item are shares as to which any Reporting Person has
a right to acquire that is exercisable within 60 days. None of the Reporting Persons or, to the
knowledge of the Reporting Persons, any of the persons listed on Schedule II hereto,
beneficially owns any Common Stock other than as set forth herein. Except as set forth herein, no
other person is known to have the right to receive or the power to direct the receipt of
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dividends from, or the proceeds from the sale of, any of the shares of the Common Stock that
are the subject of this Statement.
No transactions in the Common Stock were effected by the Reporting Persons, or, to their
knowledge, any of the persons listed on Schedule II hereto during the preceding 60 days.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the
Issuer.
Item 6 is hereby amended and supplemented as follows:
Each of the Merger Termination Agreement and the IIA Termination Agreement (each of which is
defined and described in Item 4, which definitions and descriptions are incorporated herein by
reference) are filed as exhibits hereto and are incorporated by reference in their entirety into
this Item 6.
Item 7. Material to be Filed as Exhibits
Item 7 is hereby amended and supplemented as follows:
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Exhibit |
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Description |
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99.17 |
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Joint Filing Agreement, dated July 30, 2007, between Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Merrill Lynch & Co., Inc.
(incorporated by reference to Exhibit 99.1 of the Reporting
Persons Schedule 13D filed on July 30, 2007). |
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99.18 |
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Termination Agreement and Release, dated May 11, 2008, by and
among Cloud Acquisition Corporation, Cloud Merger Corporation, ML IBK
Positions, Inc. and
the Company (incorporated by reference to Exhibit 10.1 of the
Companys current report on Form 8-K filed on May 12, 2008). |
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99.19 |
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Termination Agreement and Release, dated May 11, 2008, by and
among MLGPE Fund US Alternative, L.P., Cloud Holding Company, LLC,
Cloud Acquisition Corporation and the Rollover Investors named
therein. |
6
SIGNATURES
After reasonable inquiry and to the best of my knowledge and belief, I certify that the
information set forth in this statement is true, complete and correct.
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MERRILL LYNCH PIERCE, FENNER & SMITH INCORPORATED
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By: |
/s/ Jonathan Santelli |
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Name: |
Jonathan Santelli |
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Title: |
Assistant Secretary |
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Date: |
May 13, 2008 |
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MERRILL LYNCH & CO., INC.
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By: |
/s/ Jonathan Santelli |
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Name: |
Jonathan Santelli |
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Title: |
Assistant Secretary |
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Date: |
May 13, 2008 |
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EXHIBIT INDEX
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Exhibit |
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Description |
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99.17 |
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Joint Filing Agreement, dated July 30, 2007, between Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Merrill Lynch & Co., Inc.
(incorporated by reference to Exhibit 99.1 of the Reporting
Persons Schedule 13D filed on July 30, 2007). |
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99.18 |
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Termination Agreement and Release, dated May 11, 2008, by and
among Cloud Acquisition Corporation, Cloud Merger Corporation, ML IBK
Positions, Inc. and
the Company (incorporated by reference to Exhibit 10.1 of the
Companys current report on Form 8-K filed on May 12, 2008). |
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99.19 |
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Termination Agreement and Release, dated May 11, 2008, by and
among MLGPE Fund US Alternative, L.P., Cloud Holding Company, LLC,
Cloud Acquisition Corporation and the Rollover Investors named
therein. |
8
SCHEDULE II
EXECUTIVE OFFICERS AND DIRECTORS
The names and principal occupations of each of the executive officers and directors of the
Reporting Persons are set forth below. Unless otherwise noted, all of these persons have as their
business address 4 World Financial Center, New York, NY 10080.
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Merrill Lynch, |
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Pierce, |
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Fenner & Smith |
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Incorporated |
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Present Principal Occupation |
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Citizenship |
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Rosemary T. Berkery
Executive Officer
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Executive Vice President; Vice
Chairman; General Counsel of
Merrill Lynch & Co., Inc.
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United States |
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Candace E. Browning
Director
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Senior Vice President; President of
Merrill Lynch Global Research
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United States |
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Gregory J. Fleming
Director
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Executive Vice President; President
and Chief Operating Officer of
Merrill Lynch & Co., Inc.
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United States |
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Robert J. McCann
Director and
Executive Officer
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Chairman and Chief Executive Officer;
Executive Vice President of Merrill
Lynch & Co., Inc.; Vice Chairman,
Global Wealth Management
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United States |
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Carlos M. Morales
Director
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Senior Vice President
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United States |
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Joseph F. Regan
Executive Officer
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First Vice President, Chief
Financial
Officer and Controller
Merrill Lynch & Co., Inc.
95 Greene Street (8th Floor)
Jersey City, NJ 07032
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United States |
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Merrill Lynch & Co., |
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Inc. |
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Present Principal Occupation |
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Citizenship |
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Rosemary T. Berkery
Executive Officer
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Executive Vice President; Vice
Chairman; General Counsel
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United States |
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Carol T. Christ
Director
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President, Smith College
c/o Corporate Secretarys Office
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United States |
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Merrill Lynch & Co., |
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Inc. |
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Present Principal Occupation |
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Citizenship |
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222 Broadway, 17th Floor
New York, NY 10038 |
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Armando M. Codina
Director
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President and Chief Executive
Officer of Flagler Development
Group
c/o Corporate Secretarys Office
222 Broadway, 17th Floor
New York, NY 10038
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United States |
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Virgis W. Colbert
Director
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Corporate Director
c/o Corporate Secretarys Office
222 Broadway, 17th Floor
New York, NY 10038
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United States |
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Alberto Cribiore
Director
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Managing Partner, Brera Capital
Partners
c/o Corporate Secretarys Office
222 Broadway, 17th Floor
New York, NY 10038
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United States |
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Nelson Chai
Executive Officer
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Executive Vice President, Chief
Financial Officer
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United States |
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John D. Finnegan
Director
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Chairman of the Board, President and
Chief Executive Officer of The
Chubb Corporation
c/o Corporate Secretarys Office
222 Broadway, 17th Floor
New York, NY 10038
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United States |
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Gregory J. Fleming
Executive Officer
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President; Chief Operating Officer
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United States |
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Judith Mayhew Jonas
Director
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Member of the U.K. governments
Commission for Equality and Human
Rights
c/o Corporate Secretarys Office
222 Broadway, 17th Floor
New York, NY 10038
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United Kingdom |
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Robert J. McCann
Executive Officer
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Executive Vice President; President,
Vice Chairman, Global Wealth
Management
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United States |
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Aulana L. Peters
Director
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Corporate Director
c/o Corporate Secretarys Office
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United States |
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Merrill Lynch & Co., |
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Inc. |
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Present Principal Occupation |
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Citizenship |
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222 Broadway, 17th Floor
New York, NY 10038 |
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Joseph W. Prueher
Director
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Corporate Director, Consulting
Professor to the Stanford-Harvard
Preventive Defense Project
c/o Corporate Secretarys Office
222 Broadway, 17th Floor
New York, NY 10038
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United States |
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Ann N. Reese
Director
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Co-Founder and Co-Executive
Director of the Center for Adoption
Policy
c/o Corporate Secretarys Office
222 Broadway, 17th Floor
New York, NY 10038
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United States |
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Charles O. Rossotti
Director
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Senior Advisor to The Carlyle Group
c/o Corporate Secretarys Office
222 Broadway, 17th Fl.
New York, NY 10038
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United States |
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John A. Thain
Director and
Executive Officer
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Chairman of the Board and Chief
Executive Officer
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United States |
11
SCHEDULE III
PROCEEDINGS
In July 2007,
the U.S. Commodity Futures Trading Commission (the CFTC) found that on certain occasions from 2001 to 2005 Merrill Lynch
Alternative Investments (MLAI) violated CFTC Regulation 4.22(c) by failing to timely file
commodity pool annual reports with the National Futures Association and to timely distribute such
reports to pool participants. Without admitting or denying the allegations, MLAI agreed to a
cease-and-desist order and paid a fine in the amount of $500,000.
As part of a settlement relating to managing auctions for auction rate securities, the
Securities and Exchange Commission (the Commission) accepted the offers of settlement of
15 broker-dealer firms, including Merrill Lynch, Pierce, Fenner & Smith Incorporated
(MLPF&S), and issued a settlement order on May 31, 2006. The Commission found, and MLPF&S
neither admitted nor denied, that respondents (including MLPF&S) violated section 17(a)(2) of the
Securities Act of 1933 by managing auctions for auction rate securities in ways that were not
adequately disclosed or that did not conform to disclosed procedures. MLPF&S consented to a cease
and desist order, a censure, a civil money penalty, and compliance with certain undertakings.
On March 13, 2006, MLPF&S entered into a settlement with the Commission whereby the Commission
alleged, and MLPF&S neither admitted nor denied, that MLPF&S failed to furnish promptly to
representatives of the Commission electronic mail communications (e-mails) as required
under Section 17(a) of the Exchange Act and Rule 17a-4(j) thereunder. The Commission also alleged,
and MLPF&S neither admitted nor denied, that Merrill Lynch failed to retain certain e-mails related
to its business as such in violation of Section 17(a) of the Exchange Act and Rule 17a-4(b)(4)
thereunder. Pursuant to the terms of the settlement, MLPF&S consented to a cease and desist order,
a censure, a civil money penalty of $2,500,000, and compliance with certain undertakings relating
to the retention of e-mails and the prompt production of e-mails to the Commission.
In March 2005, Merrill Lynch & Co., Inc. and certain of its affiliates (Merrill Lynch & Co.,
Inc. and its affiliates collectively, Merrill Lynch) reached agreements with the State of New
Jersey and the New York Stock Exchange (the NYSE) and reached an agreement in principle
with the State of Connecticut pursuant to which Merrill Lynch, without admitting or denying the
allegations, consented to a settlement that included findings that it failed to maintain certain
books and records and to reasonably supervise a team of former financial analysts (FAs)
who facilitated improper market timing by a hedge fund client. Merrill Lynch terminated the FAs in
October 2003, brought the matter to the attention of regulators, and cooperated fully in the
regulators review. The settlement will result in aggregate payments of $13.5 million.
In March 2005, Merrill Lynch reached an agreement in principle with the NYSE pursuant to which
Merrill Lynch, without admitting or denying the allegations, later consented to a settlement that
included findings with regard to certain matters relating to the failure to deliver prospectuses
for certain auction rate preferred shares and open-end mutual funds; the failure to deliver product
descriptions with regard to certain exchange-traded funds; the failure to ensure
12
that proper registration qualifications were obtained for certain personnel; issues with regard to
the retention, retrieval and review of e-mails; isolated lapses in branch office supervision; late
reporting of certain events such as customer complaints and arbitrations; the failure to report
certain complaints in quarterly reports to the NYSE due to a systems error; and partial
non-compliance with Continuing Education requirements. The settlement resulted in a payment of $10
million to the NYSE.
On November 3, 2004, a jury in Houston, Texas convicted four former Merrill Lynch employees of
criminal misconduct in connection with a Nigerian barge transaction that the government alleged
helped Enron inflate its 1999 earnings by $12 million. The jury also found that the transaction led
to investor losses of $13.7 million. Those convictions were reversed by a federal appellate court
on August 1, 2006, except for one conviction against one employee based on perjury and obstruction
of justice. The government has appealed the reversals. In 2003, Merrill Lynch agreed to pay $80
million to settle Commission charges that it aided and abetted Enrons fraud by engaging in two
improper year-end transactions in 1999, including the Nigerian barge transaction. The $80 million
paid in connection with the settlement with the Commission will be made available to settle
investor claims. In September 2003, the United States Department of Justice agreed not to prosecute
Merrill Lynch for crimes that may have been committed by its former employees related to certain
transactions with Enron, subject to certain understandings, including Merrill Lynchs continued
cooperation with the Department, its acceptance of responsibility for conduct of its former
employees, and its agreement to adopt and implement new policies and procedures related to the
integrity of client and counter-party financial statements, complex structured finance transactions
and year-end transactions.
On or about June 27, 2003, the Attorney General for the State of West Virginia brought an
action against the defendants that participated in the April 28, 2003, settlement described below.
The action, filed in the West Virginia State Court, alleged that the defendants research practices
violated the West Virginia Consumer Credit and Protection Act. On September 16, 2005, the Circuit
Court of Marshall County, West Virginia, dismissed the case, following an earlier decision by the
West Virginia Supreme Court holding that the West Virginia Attorney General lacked authority to
bring the claims. On April 28, 2003, the Commission, NYSE, National Association of Securities
Dealers, and state securities regulators announced that the settlements-in-principle that the
regulators had disclosed on December 20, 2002, had been reduced to final settlements with regard to
ten securities firms, including Merrill Lynch. On October 31, 2003, the United States District
Court for the Southern District of New York entered final judgments in connection with the April
28, 2003 research settlements. The final settlements pertaining to Merrill Lynch, which involved
both monetary and non-monetary relief, brought to a conclusion the regulatory actions against
Merrill Lynch related to its research practices. Merrill Lynch entered into these settlements
without admitting or denying the allegations and findings by the regulators, and the settlements
did not establish wrongdoing or liability for purposes of any other proceedings.
13