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
August 27, 1996
Date of Report (Date of earliest event reported)
CENTURY TELEPHONE ENTERPRISES, INC.
(Exact name of Registrant as specified in its charter)
LOUISIANA 1-7784 72-0651161
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification Number)
100 Century Park Drive
Monroe, Louisiana 71203
(Address of principal executive offices) (Zip Code)
(318) 388-9500
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Item 5: Other Events
On August 27, 1996, the Board of Directors of Century
Telephone Enterprises, Inc. (the "Company") declared a dividend
of one preference share purchase right (a "Right") for each
outstanding share of common stock, par value $1.00 per share (the
"Common Shares"), of the Company. The dividend is payable on
November 1, 1996 to stockholders of record on September 30, 1996
(the "Record Date"). Each Right entitles the registered holder
to purchase from the Company one one-hundredth of a share of
Series BB Participating Cumulative Preference Stock, par value
$25 per share (the "Preference Shares"), of the Company at a
price of $110 per one one-hundredth of a Preference Share (the
"Purchase Price"), subject to adjustment as described below. The
description and terms of the Rights are set forth in a Rights
Agreement dated as of August 27, 1996 (the "Rights Agreement")
between the Company and Society National Bank, as Rights Agent
(the "Rights Agent").
Initial Status of the Rights
----------------------------
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated
persons (an "Acquiring Person") have acquired beneficial
ownership of 15% or more of the outstanding Common Shares or (ii)
10 business days (or such later date as may be determined by
action of the Board of Directors prior to such time as any person
or group of affiliated persons becomes an Acquiring Person)
following the commencement of, or announcement of an intention to
make, a tender offer or exchange offer that, if consummated,
would result in the beneficial ownership by a person or group of
15% or more of the outstanding Common Shares (the earlier of such
dates being called the "Distribution Date"), the Rights will be
evidenced by the Common Share certificates outstanding as of the
Record Date, together with a copy of a Summary of Rights in the
form provided in an exhibit to the Rights Agreement.
The Rights Agreement provides that, until the Distribution
Date (or earlier redemption or expiration of the Rights), the
Rights will be transferred with and only with the Common Shares.
Until the Distribution Date (or earlier redemption or expiration
of the Rights), new Common Share certificates issued after the
Record Date upon any transfer or new issuance of Common Shares
will contain a notation incorporating the Rights Agreement by
reference. Until the Distribution Date (or earlier redemption or
expiration of the Rights), the surrender for transfer of any
certificates for Common Shares outstanding as of the Record Date,
even without such notation or a copy of the Summary of Rights
being attached thereto, will also constitute the transfer of the
Rights associated with the Common Shares represented by such
certificate.
Distribution and Term of Rights
-------------------------------
As soon as practicable following the Distribution Date,
separate certificates evidencing the Rights will be mailed to
holders of record of the Common Shares as of the close of
business on the Distribution Date and such separate certificates
alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on November 1, 2006 (the "Final Expiration
Date"), unless the Final Expiration Date is extended or unless
the Rights are earlier redeemed or exchanged by the Company, in
each case, as described below.
Triggering Events
-----------------
In the event that the Company is acquired in a merger or
other business combination transaction or 50% or more of its
consolidated assets or earning power are sold after a person or
group has become an Acquiring Person, proper provision will be
made so that each holder of a Right will thereafter have the
right to receive, upon the exercise thereof at the then current
exercise price of the Right, that number of shares of common
stock of the acquiring company which at the time of such
transaction will have a market value of two times the exercise
price of the Right. In the event that any person or group of
affiliated or associated persons becomes an Acquiring Person,
proper provision shall be made so that each holder of a Right,
other than Rights beneficially owned by the Acquiring Person
(which will thereafter be void), will thereafter have the right
to receive upon exercise that number of Common Shares having a
market value at the time of such occurrence of two times the
exercise price of the Right.
Anti-Dilution
-------------
The Purchase Price payable, and the number of Preference
Shares or other securities or property issuable, upon exercise of
the Rights are subject to adjustment from time to time to prevent
dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preference
Shares, (ii) upon the grant to holders of the Preference Shares
of certain rights, options or warrants to subscribe for or
purchase Preference Shares at a price, or securities convertible
into Preference Shares with a conversion price, less than the
then-current market price of the Preference Shares or (iii) upon
the distribution to holders of the Preference Shares of evidences
of indebtedness or assets (excluding regular quarterly cash
dividends or dividends payable in Preference Shares) or of
subscription rights or warrants (other than those referred to
above).
The number of outstanding Rights and the number of one one-
hundredths of a Preference Share issuable upon exercise of each
Right are also subject to adjustment in the event of a stock
split of the Common Shares or a stock dividend on the Common
Shares payable in Common Shares or subdivisions, consolidations
or combinations of the Common Stock occurring, in any such case,
prior to the Distribution Date.
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an
adjustment of at least 1%. No fractional Preference Shares will
be issued (other than fractions which are integral multiples of
one one-hundredth of a Preference Share, which may, at the
election of the Company, be evidenced by depository receipts) and
in lieu thereof, an adjustment in cash will be made based on the
market price of the Preference Shares on the last trading day
prior to the date of exercise.
Exchange and Redemption
-----------------------
At any time after any person or group becomes an Acquiring
Person and prior to the acquisition by such person or group of
50% or more of the outstanding Common Shares, the Board of
Directors of the Company may exchange the Rights (other than
Rights owned by such person or group which have become void), in
whole or in part, at an exchange ratio of one Common Share, or
one one-hundredth of a Preference Share, per Right (subject to
adjustment).
At any time prior to the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 15%
or more of the outstanding Common Shares, the Board of Directors
of the Company may redeem the Rights in whole, but not in part,
at a price of $.01 per Right (the "Redemption Price"), subject to
adjustment. The redemption of the Rights may be made effective
at such time, on such basis and with such conditions as the Board
of Directors in its sole discretion may establish. Immediately
upon any redemption of the Rights, the right to exercise the
Rights will terminate and the only right of the holders of Rights
will be to receive the Redemption Price.
Rights, Preferences and Limitations of Preference Shares
--------------------------------------------------------
Preference Shares purchasable upon exercise of the Rights
will not be redeemable. Each Preference Share will entitle the
holder to receive a preferential quarterly dividend payment of
the greater of $10 or 100 times the aggregate dividend declared
per Common Share. In the event of liquidation, the holders of
the Preference Shares will be entitled to a minimum preferential
liquidation payment of $100 per share and, under certain
circumstances, may be entitled to receive additional
distributions. Each Preference Share will entitle the holder to
100 votes, voting together with the Common Shares. Finally, in
the event of any merger, consolidation or other transaction in
which Common Shares are exchanged, each Preference Share will
entitle the holder to receive 100 times the amount received per
Common Share. These rights are protected by customary
antidilution provisions. Because of the nature of the Preference
Shares' dividend, liquidation and voting rights, the value of
each one one-hundredth interest in a Preference Share purchasable
upon exercise of each Right should approximate the value of one
Common Share.
Amendments
----------
The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of
the Rights, including an amendment to lower the 15% thresholds
described above to not less than the greater of (i) the sum of
.001% and the largest percentage of the outstanding Common Shares
then known to the Company to be beneficially owned by any person
or group of affiliated or associated persons and (ii) 10%, except
that from and after such time as any person or group of
affiliated or associated persons becomes an Acquiring Person, no
such amendment may adversely affect the interests of the holders
of the Rights.
Miscellaneous
-------------
Until a Right is exercised, the holder thereof, as such,
will have no rights as a stockholder of the Company, including,
without limitation, the right to vote or to receive dividends.
The Rights may have certain anti-takeover effects. The
Rights should not, however, interfere with any merger or other
business combination approved by the Board of Directors since the
Rights may be redeemed by the Company as described above.
While the dividend of the rights will not be taxable to
stockholders or to the Company, stockholders or the Company may,
depending upon the circumstances, recognize taxable income in the
event that the Rights become exercisable as described above.
The Rights Agreement and a form of press release announcing
the declaration of the Rights are attached hereto as exhibits and
are incorporated herein by reference. The foregoing description
of the Rights is qualified in its entirety by reference to such
exhibits.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(c) Exhibits.
The exhibits to this report are listed in the exhibit list,
which appears elsewhere herein and is incorporated herein by
reference.
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the Company has duly caused this report to
be signed on its behalf by the undersigned thereunto duly
authorized.
CENTURY TELEPHONE ENTERPRISES, INC.
By: /s/ Harvey P. Perry
________________________________
Harvey P. Perry
Senior Vice-President,
General Counsel and Secretary
Dated: August 30, 1996
EXHIBIT LIST
Exhibit Description
1. Rights Agreement, dated as of August 27,
1996, between Century Telephone Enterprises,
Inc. and Society National Bank, as Rights
Agent.
2. Form of Articles of Amendment for the Series
BB Participating Cumulative Preference Stock,
included as Exhibit A to the Rights
Agreement, which were executed in such form
on August 27, 1996 and filed on August 29,
1996 with the Secretary of State of the State
of Louisiana.
3. Forms of Rights Certificate, Assignment, and
Election to Purchase, included as Exhibit B
to the Rights Agreement.
4. Summary of Rights to Purchase Preference
Shares, included as Exhibit C to the Rights
Agreement.
5. Form of press release dated August 27, 1996.