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) June 20, 1997
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THE TODD-AO CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 0-1461 13-1679856
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
900 North Seward Street, Hollywood, California 90038
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (213) 962-4000
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Not Applicable
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(Former name or former address, if changed from last report)
Exhibit index located on page 3
THE TODD-AO CORPORATION
FORM 8-K
JUNE 20, 1997
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TABLE OF CONTENTS
Item 2. ACQUISITION OR DISPOSITION OF ASSETS. Page 2
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS.
a. Financial Statements of business acquired:
Item 7 (a) has been omitted due to the
impracticality of filing the required
audited financial statements at the
time of filing this report on Form 8-K.
Item 7 (a) will be filed on Form 8 within
60 days after the required filing date of
this report.
b. Pro forma condensed financial information
Item 7 (b) has been omitted due to the
impracticality of filing the required pro
forma information at the time of filing
this report on Form 8-K. Item 7 (b) will
be filed on Form 8 within 60 days after
required filing date of this report.
c. Exhibit Index Page 3
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Item 2. ACQUISITION OR DISPOSITION OF ASSETS
On the closing date, June 20, 1997, an agreement dated June 18,
1997 for the purchase and sale of substantially all of the assets
and certain liabilities was entered into by and among The Todd-AO
Corporation, a Delaware corporation ("TAO") , Todd-AO HD, Inc., a
California corporation (collectively the "Purchaser") and
Hollywood Digital Limited Partnership, a Delaware limited
partnership (the "Seller"), and Hollywood Digital, Inc., a
Delaware corporation; the Palladion Limited Partnership, a
Delaware limited partnership; HDZ Digital Limited Partnership, a
Massachusetts limited partnership; Rand Gladden; William Romeo;
M. David Cottrell; and Michael Jackson (each, a "Partner" and
collectively, the "Partners") for an aggregate consideration of
$30,400,000. The purchase price is subject to reduction by an
adjustment factor if the operating profit (as defined in the
agreement) for the period July 1, 1996 to June 30, 1997 is less
than $5,500,000. The adjustment factor is six (6) times the
amount by which $5,500,000 exceeds the operating profit. The
acquisition has been accounted for as a purchase. Of the total
purchase price, cash in the amount of $17,741,429 was used to pay
down existing debt of the seller; $19,500 was used to assume
additional debt; and the remaining $12,639,071 is evidenced by
the issuance of two convertible subordinated notes of TAO, one in
the amount of $9,239,071 and one in the amount of $3,400,000.
The second note in the amount of $3,400,000, is subject to
reduction by the adjustment factor described above and will be
held in escrow until the purchase price has been finally
determined. The principal is due and payable at the end of three
years and interest is payable annually at 5%. The notes are
convertible into TAO Class A Common Stock at the conversion price
of $11.875 per share at any time before the maturity date. The
final purchase price will approximate fair market value.
Financing of the debt paid at closing was provided by the
Company's credit facility with its institutional lender.
Todd-AO provides post-production sound and video services to the
film and television industries and Hollywood Digital ("HD") is an
all digital, post-production facility providing sound and video
services to the film, television, and commercial advertising
industries.
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Item 7. FINANCIAL STATEMENTS, PRO FORMA INFORMATION AND EXHIBITS
c. The following exhibits are filed with this current report on
Form 8-K:
EXHIBIT NO. EXHIBIT
1 Agreement for the purchase and sale of assets
between The Todd-AO Corporation, Todd-AO HD, Inc.,
and Hollywood Digital Limited Partnership and its
Partners dated as of June 18, 1997 ("The Purchase
Agreement").
1 (a) Exhibit A to The Purchase Agreement: Todd-AO
Corporation Convertible Subordinated Note No.
1 (b) Exhibit B to The Purchase Agreement: Todd-AO
Corporation Convertible Subordinate Note No.
1 (c) The Registration Rights Agreement.
1 (d) Assignment & Assumption of Lease (6660 Sunset
Blvd.)
1 (e) Assignment & Assumption of Lease (6690 Sunset
Blvd.)
1 (f) Assignment & Assumption of Lease (1661 Lincoln
Blvd.)
1 (g) Indemnification Agreement.
1 (h) Bill of Sale.
1 (i) Hollywood Digital and HD-Related Partners
Noncompetition Agreement.
1 (j) Phemus Noncompetition Agreement.
2 Employment Agreement dated as of June 19, 1997
between The Todd-AO Corporation and Rand Gladden
including Memorandum of Understanding.
3 Fifth Amendment dated June 6, 1997 to Credit
Agreement dated as of December 2, 1994 between The
Todd-AO Corporation and Bank of America National
Trust and Savings Association.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized
THE TODD-AO CORPORATION
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(Registrant)
/S/ SILAS R. CROSS
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Silas R. Cross
Vice President/Treasurer
JULY 3, 1997
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Date
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