UNITED STATES
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): February 8, 2005
THE SPORTS CLUB COMPANY, INC.
_________________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 1-13290 95-4479735
________________________________________________________________________________
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
11100 Santa Monica Boulevard, Suite 300, Los Angeles, California 90025
________________________________________________________________________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (310) 479-5200
---------------------------
Not Applicable
________________________________________________________________________________
(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:
[ ] 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 240.13 e-4(c))
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Section 8 - Other Events
Item 8.01 Other Events.
On February 8, 2005, The Sports Club Company, Inc., a Delaware corporation
(the "Company") and Millennium Development Partners VIII LLC ("Millennium")
signed a term sheet (the "Term Sheet"). The Term Sheet contemplates transactions
wherein (i) the Company's public shareholders would receive $2.00 for each share
of Common Stock owned by them through a merger of a newly formed corporation (to
be owned by the Company's four Principal Stockholders, which as defined, include
Millennium, D. Michael Talla, Rex A. Licklider and/or Kayne Anderson Capital
Advisors, L.P., and their respective affiliates) with and into the Company, with
the Company continuing as the surviving corporation, (ii) the Company would sell
certain of its assets to Millennium, and (iii) the Company would refinance
certain of its owned real estate. The Term Sheet is not binding on the parties
and is subject to the execution of definitive agreements and the satisfaction of
a number of conditions. Accordingly, the Company can give no assurances that the
proposed transactions will be completed
In connection with the Term Sheet the Company and American Stock Transfer &
Trust Company, as Rights Agent, entered into an amendment (the "Amendment") to
the Company's Rights Agreement adopted on September 29, 1998, as amended by (a)
First Amendment to Rights Agreement dated as of February 18, 1999, (b) Second
Amendment to Rights Agreement dated as of July 2, 1999, (c) Third Amendment to
Rights Agreement dated as of April 27, 2000, (d) Fourth Amendment to Rights
Agreement dated as of June 27, 2001, (e) Fifth Amendment to Rights Agreement
dated as of September 6, 2002, (f) Sixth Amendment to Rights Agreement dated as
of March 5, 2003, (g) Seventh Amendment to Rights Agreement dated as of April
14, 2003, (h) Eighth Amendment to Rights Agreement dated as of May 30, 2003, (i)
Ninth Amendment to Rights Agreement dated as of July 30, 2003, (j) Tenth
Amendment to Rights Agreement dated as of September 30, 2003, (k) Eleventh
Amendment to Rights Agreement dated as of November 25, 2003, (l) Twelfth
Amendment to Rights Agreement dated as of March 3, 2004, and (m) Thirteenth
Amendment to Rights Agreement dated as of March 10, 2004 (as so amended, the
"Rights Agreement").
On February 8, 2005, the Company, with the approval of the Special
Committee of the Board of Directors (which was created to evaluate strategic
alternatives for the Company, including the possibility of a sale of one or more
of the Company's operating assets in a transaction in which one or more of the
Company's Principal Stockholders might participate), amended its Rights
Agreement to provide that until April 30, 2005, the Rights Plan will not be
triggered in connection with the Term Sheet, including any amendments or changes
thereto, so long as the amendments or changes are approved, in advance by the
Special Committee.
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All statements in this report other than statements of historical fact are
forward looking statements within the meaning of the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995. These statements are based
on management's current expectations and beliefs and are subject to a number of
factors and uncertainties that could cause actual results to differ materially
from those described in this report. The forward looking statements speak only
as of the date of this report, and the Company expressly disclaims any
obligation to release publicly any update or revision to any forward looking
statement contained herein if there are changes in the Company's expectations or
in any events, conditions or circumstances on which any such forward looking
statement is based.
The Amendment to the Company's Rights Agreement is attached to this Current
Report on Form 8-K as Exhibit 99.1 and is incorporated herein by reference.
Section 9 - Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits.
(a) Financial statements of business acquired.
None
(b) Pro forma financial information.
None
(c) Exhibits
99.1 Fourteenth Amendment to Rights Agreement Dated as of
October 6, 1998
Signatures
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: February 14, 2005 THE SPORTS CLUB COMPANY, INC.
By: /s/ Timothy M. O'Brien
----------------------------
Timothy M. O'Brien
Chief Financial Officer
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Exhibit 99.1
FOURTEENTH AMENDMENT TO RIGHTS AGREEMENT
DATED AS OF OCTOBER 6, 1998
This Fourteenth Amendment (the "Fourteenth Amendment") to the Rights
Agreement is made and entered into as of February 8, 2005, and amends that
certain agreement entered into by and between The Sports Club Company, Inc., a
Delaware corporation (the "Company"), and American Stock Transfer & Company, a
New York corporation (the "Rights Agent"), dated as of October 6, 1998, as
amended by the (a) First Amendment to Rights Agreement dated as of February 18,
1999, (b) Second Amendment to Rights Agreement dated as of July 2, 1999, (c)
Third Amendment to Rights Agreement dated as of April 27, 2000, (d) Fourth
Amendment to Rights Agreement dated as of June 27, 2001, (e) Fifth Amendment to
Rights Agreement dated as of September 6, 2002, (f) Sixth Amendment to Rights
Agreement dated as of March 5, 2003, (g) Seventh Amendment to the Rights
Agreement dated as of April 14, 2003, (h) Eighth Amendment to the Rights
Agreement dated as of May 30, 2003, (i) Ninth Amendment to the Rights Agreement
dated as of July 30, 2003, (j) Tenth Amendment to the Rights Agreement dated as
of September 30, 2003, (k) Eleventh Amendment to the Rights Agreement dated as
of November 25, 2003, (l) Twelfth Amendment to the Rights Agreement dated as of
March 3, 2004 and (m) Thirteenth Amendment to the Rights Agreement dated as of
March 10, 2004 (as so amended, the "Rights Agreement"). Capitalized terms used
but not defined herein shall have the meanings given to them in the Rights
Agreement.
R E C I T A L S
---------------
WHEREAS, on September 29, 1998, the Board of Directors of the Company (the
"Board") authorized and declared a dividend of one preferred share purchase
right for each Common Share of the Company outstanding on October 6, 1998, each
right representing the right to purchase one five-hundredth of a Preferred Share
upon the terms and subject to the conditions set forth in the Rights Agreement,
and further authorized and directed the issuance of one right with respect to
each Common Share that shall become outstanding between the Record Date and the
earliest of the Distribution Date, the Redemption Date and the Expiration Date;
WHEREAS, the Company and the Rights Agent entered into the Rights Agreement
as of October 6, 1998, and thereafter amended said Agreement on the dates set
forth in the first paragraph of this Fourteenth Amendment;
WHEREAS, on September 15, 2004, the Board approved the creation of a
special committee thereof (the "Special Committee") to evaluate strategic
alternatives for the Company, including the possibility of a sale of one or more
of the Company's operating assets in a transaction in which certain stockholders
of the Company, including Millennium, D. Michael Talla, Rex A. Licklider and/or
Kayne Anderson Capital Advisors, L.P., and their respective affiliates
(collectively, the "Principal Stockholders") would participate;
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WHEREAS, Millennium has proposed a transaction in which the Principal
Stockholders would contribute all of their outstanding shares of preferred stock
and/or common stock of the Company, and Millennium would contribute a certain
amount of cash, to a newly created Delaware subsidiary that would merge with the
Company, cashing out the pubic shareholders; simultaneously with the merger,
Millennium would purchase certain assets of the Company (the "Proposed
Transaction");
WHEREAS, the Principal Stockholders and the Company desire to enter into a
term sheet with respect to the Proposed Transaction (the "Term Sheet");
WHEREAS, the Special Committee has determined that it is in the best
interests of the Company and its stockholders to amend the Rights Agreement as
set forth herein.
A G R E E M E N T
-----------------
NOW, THEREFORE, in consideration of the recitals, and the mutual covenants
and agreements hereinafter set forth, the parties hereto hereby amend the Rights
Agreement as follows:
1. The definitions of "Beneficial Owner" and "Beneficially Owned" set forth
in Section 1 of the Rights Agreement are hereby amended by adding the following
as the last paragraph thereof:
Notwithstanding anything to the contrary in this Agreement, from February
8, 2005 until April 30, 2005, no securities shall be deemed to be beneficially
owned by any person solely pursuant to this clause (iv) in connection with (a)
the Term Sheet, including any amendments or changes thereto, so long as the
amendments or changes are approved, in advance of their adoption, by the Special
Committee.
2. No Other Changes. Except as expressly set forth in this Amendment, the
terms of the Rights Agreement shall continue in full force and effect in
accordance with its terms.
3. Miscellaneous. This Amendment (together with the Rights Agreement)
represents the entire agreement and understanding between the parties hereto
with respect to this Amendment and supersedes all prior and contemporaneous
written and oral negotiations, discussions and agreements; shall be binding on,
and inure to the benefit of, the parties hereto and their respective successors,
assigns and legal representatives; and may be executed in counterparts, each of
which shall be deemed an original but all of which shall constitute one and the
same agreement. Paragraph headings appearing in this Amendment are for the
convenience of the parties and shall not be considered in interpreting or
construing any term or provision hereof.
[Balance of Page Intentionally Left Blank; Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment on the
date first written above.
Company:
THE SPORTS CLUB COMPANY, INC.
Attest:
By: /s/ Timothy M. O'Brien
------------------------
/s/ Lois Barberio Name: Timothy M. O'Brien
- -----------------------------
Name: Lois Barberio Title: Chief Financial Officer
Title: Corporate Secretary
Trustee:
AMERICAN STOCK TRANSFER & TRUST
COMPANY
Attest:
By: /s/ Herbert J. Lemmer
------------------------------
/s/ Susan Silber Name: Herbert J. Lemmer
- ------------------------------ Title: Vice President
Name: Susan Silber
Title: Assistant Secretary
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