================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
Crown Media Holdings, Inc.
(Name of Issuer)
Class A Common Stock, Par Value $0.01 Per Share
(Title of Class of Securities)
228411 10 4
(CUSIP Number)
Peter Schube
Executive Vice President and General Counsel
The Jim Henson Company, Inc.
1416 North La Brea Avenue
Hollywood, CA 90028
(323) 802-1570
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
March 15, 2001
(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 Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box: |_|.
================================================================================
CUSIP No. 228411 10 4
--------------------------------------------------------------------------------
1. NAMES OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON
EM.TV & Merchandising AG (No I.R.S. Identification No. - non-U.S. entity)
--------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |X|
--------------------------------------------------------------------------------
3. SEC USE ONLY
--------------------------------------------------------------------------------
4. SOURCE OF FUNDS OO
--------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) |_|
--------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Germany
--------------------------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 5,377,721 Shares of Class A Common Stock
SHARES ------------------------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY
EACH 0 Shares of Class A Common Stock
REPORTING ------------------------------------------------------
PERSON 9. SOLE DISPOSITIVE POWER
WITH
5,377,721 Shares of Class A Common Stock
------------------------------------------------------
10. SHARED DISPOSITIVE POWER
0 Shares of Class A Common Stock
--------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,377,721 Shares of Class A Common Stock
--------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |_|
--------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Approximately 15.5% of the Class A Common Stock.
--------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON
CO
--------------------------------------------------------------------------------
2
CUSIP No. 228411 10 4
--------------------------------------------------------------------------------
1. NAMES OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON
The Jim Henson Company, Inc. (13-2571101)
--------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |X|
--------------------------------------------------------------------------------
3. SEC USE ONLY
--------------------------------------------------------------------------------
4. SOURCE OF FUNDS OO
--------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) |_|
--------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
New York
--------------------------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 5,377,721 Shares of Class A Common Stock
SHARES ------------------------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY
EACH 0 Shares of Class A Common Stock
REPORTING ------------------------------------------------------
PERSON 9. SOLE DISPOSITIVE POWER
WITH
5,377,721 Shares of Class A Common Stock
------------------------------------------------------
10. SHARED DISPOSITIVE POWER
0 Shares of Class A Common Stock
--------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,377,721 Shares of Class A Common Stock
--------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES |_|
--------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Approximately 15.5% of the Class A Common Stock.
--------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON
CO
--------------------------------------------------------------------------------
3
ITEM 1. SECURITY AND ISSUER.
This Statement on Schedule 13D relates to shares of Class A common stock,
par value $0.01 per share (the "Class A Common Stock"), of Crown Media Holdings,
Inc., a Delaware corporation (the "Issuer"). The Issuer's principal executive
offices are located at 6430 S. Fiddlers Green Circle, Suite 500, Englewood,
Colorado 80111.
ITEM 2. IDENTITY AND BACKGROUND.
(a) - (c) and (f): The Jim Henson Company, Inc. ("Henson") has its
principal executive office at 1416 North La Brea Avenue, Hollywood, CA 90028.
Henson's principal business is the production and marketing of entertainment
products and the provision of entertainment-related services. Henson is a New
York corporation and a wholly owned subsidiary of EM.TV & Merchandising AG
("EMTV"), a German corporation with its principal executive office at
Betastrasse 11, 85774 Unterfohring, Germany. EMTV's primary business in the
production and licensing of television and music rights, merchandising and
consumer products. As Henson's sole stockholder, EMTV exercises control over
Henson. Henson and EMTV are also referred to herein from time to time as the
"Reporting Persons".
The name, business address, present principal occupation or employment and
citizenship of each director and executive officer of Henson and EMTV is set
forth in Schedule 1 hereto and is incorporated herein by reference.
(d) and (e): During the last five years, none of Henson, EMTV or, to the
actual knowledge of Henson and EMTV, any of the persons listed on Schedule 1
hereto, (1) has been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or (2) has been a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction and as
a result of such proceeding was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any violation with
respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Henson acquired 5,377,721 shares of Class A Common Stock on March 15, 2001
(the "Closing Date") from the Issuer in exchange for contributing to the Issuer
its interest in H&H Programming - Asia, LLC ("H&H") and causing its wholly owned
subsidiary, Henson Cable Networks, Inc. ("Henson Cable"), to contribute to the
Issuer its interest in Odyssey Holdings, L.L.C. ("Odyssey"), in each case
pursuant to a Contribution Agreement dated as of March 15, 2001 (the
"Contribution Agreement") by and among Henson, the Issuer and Crown Media
International, Inc., a wholly owned subsidiary of the Issuer. A copy of the
Contribution Agreement is filed as an Exhibit hereto and is incorporated by
reference.
ITEM 4. PURPOSE OF TRANSACTION.
Henson acquired the Class A Common Stock for investment purposes. The
Reporting Persons do not seek to exercise control over the Issuer through
Henson's ownership of Common Stock. Neither of the Reporting Persons has any
present intention of acquiring additional shares
4
of Common Stock. The Reporting Persons may determine to sell all or a portion of
Henson's shares of Common Stock at any time (by exercising Henson's registration
rights under the Stockholders Agreement or otherwise) based on future market
conditions and other relevant factors. As described in Item 5, Henson's shares
of Class A Common stock currently are pledged as collateral security for EMTV's
obligations to a group of its lenders. Upon the release of such security
interest, when such financing is paid down or otherwise, Henson may pledge all
or some of the shares as collateral for EMTV's or Henson's obligations to a
substitute or additional lender or group of lenders.
ITEM 5. INTERESTS IN SECURITIES OF THE ISSUER.
(a)-(b): Henson owns 5,377,721 shares of Class A Common Stock, representing
beneficial ownership of approximately 15.5% of the shares of Class A Common
Stock and 8.22% of the shares of Class A Common Stock that would be outstanding
if the Class B Common Stock, par value $0.01 per share, of the Issuer was fully
converted. Henson has sole power to vote and dispose such shares. Through its
ownership of Henson, EMTV also beneficially owns such shares.
To the knowledge of the Reporting Persons, no shares of Common Stock of the
Issuer are beneficially owned by any executive officer or director of Henson and
EMTV.
(c): Except as described in Item 3, neither of the Reporting Persons, nor,
to the best knowledge of the Reporting Persons, any of their respective
directors or executive officers, has effected any transactions in shares of
Common Stock during the past 60 days.
(d): EMTV is the borrower under a Bridge Loan Facility dated as of April
21, 2000, as amended and restated as of May 2, 2000, as amended and waived as of
December 29, 2000, and as further amended and restated as of January 31, 2001
(the "Bridge Loan Facility"), among EMTV, Speed Investments Limited, the Banks
(as defined below), Credit Suisse First Boston, London Branch ("CSFB"), as
arranger, CSFB, as facility agent, and CSFB, as security trustee (the "Security
Trustee"). In the event of a sale of a material portion of Henson's shares of
Class A Common Stock, EMTV may be required to use the net cash proceeds thereof
to prepay the loan under the Bridge Loan Facility. Pursuant to a Pledge
Agreement dated as of January 31, 2001 by and among Henson, Tadpole Productions,
Inc. and the Security Trustee, Henson has pledged all of its shares of Class A
Common Stock to the Security Trustee to secure amounts due under the Bridge Loan
Facility. The "Banks" are Credit Suisse First Boston Aktiengesellschaft
(Frankfurt, Germany), DG Bank Deutsche Genossenschaftsbank (Munich, Germany),
Commerzbank Aktiengesellschaft, Regionalfilale Munchen-ost (Munich, Germany),
Bayerische Landesbank Girozentrale (Munich, Germany), Deutsche Bank Luxembourg
S.A. (Luxembourg), Westdeutsche Landesbank Girozentrale (Frankfurt, Germany),
BHF-Bank Aktiengesellschaft, FFM (Frankfurt, Germany).
(e): Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
In connection with the Contribution Agreement, Henson entered into an
Amended and Restated Stockholders Agreement dated as of the Closing Date (the
"Stockholders Agreement") with Hallmark Entertainment, Inc. ("HEI"), Liberty
Media Corporation ("Liberty"), VISN Management Corp. ("VISN"), JP Morgan
Partners (BHCA), L.P. ("JP Morgan") and the Issuer. The Stockholders Agreement
provides that the Issuer's Board of Directors will
5
consist of not less than 11 directors, with six nominated by HEI, one nominated
by each of Liberty, VISN and JP Morgan and two independent directors who will
not be officers or employees of any of the parties or their affiliates nominated
by the Board of Directors. The right of each of such parties to nominate a
director will terminate on the later of (1) such party owning less than 5% of
the Common Stock then outstanding or (2) such party ceasing to own at least 75%
of the Common Stock such party owns immediately following the completion of the
initial public offering of shares of the Class A Common Stock (the "IPO").
The Stockholders Agreement also provides that the Issuer will not enter
into any material transactions, except for specified transactions, with any of
the other parties or their affiliates involving an aggregate value of (1) $35.0
million or less, unless such transactions are approved by a majority of the
independent directors, and (2) more than $35.0 million, unless such transactions
are approved by a majority of the members of the Board of Directors not
nominated by the interested party.
The stockholder parties to the Stockholders Agreement agree not to transfer
more than 25% of certain Common Stock owned by them (in the case of Henson, its
shares acquired pursuant to the Contribution Agreement) prior to May 9, 2002
without the written consent of each other party, except to their affiliates,
another party to the Stockholder Agreement or their affiliates, to their
executives under a stock-based compensation package, to one or more other
stockholder parties, or in a transaction involving a merger, consolidation or
business combination with, or sale of all of our common stock to, a third party
that is not affiliated with the Issuer. Transfers by Liberty Sub to
UnitedGlobalCom, Inc. are also expected. A pledge of Common Stock to a financial
institution in a bona fide transaction is not deeemd a transfer for purposes of
the Stockholder Agreement, so long as the pledgor retains full voting power
prior to any event of default.
In addition, the Stockholders Agreement provides that, in the event HEI
proposes to transfer 20% or more of the outstanding Common Stock to an
unaffiliated third party, each other stockholder party to the Stockholders
Agreement will have the right to participate on the same terms in that
transaction with respect to the proportionate number of such other party's
shares. The Stockholders Agreement also provides that if the Issuer issues for
cash an amount of the Common Stock, in either a public offering or private
transaction, that causes Liberty and its affiliates to own, in the aggregate,
less than 10% of the outstanding Common Stock, Liberty will have the right to
purchase, at such public offering price or the average closing price of the
Class A Common Stock over a five-day period prior to the closing of such private
transaction, as applicable, an amount of the Class A Common Stock so as to
restore its and its affiliates' aggregate 10% ownership interest. Liberty must
exercise such right not less than seven days prior to the closing of such
issuance.
Under the Stockholders Agreement, HEI has the right to require the Issuer
on four occasions, and the other stockholder parties, as a group, have the right
to require the Issuer on two occasions, to register for sale the shares of the
Common Stock they hold, so long as the number of shares they require the Issuer
to register in each case is at least 7% of the Common Stock then outstanding.
The stockholder parties also have an unlimited number of "piggy back"
registration rights.
The Stockholders Agreement also provides that the Issuer will be obligated
to pay all expenses that result from the registration of the stockholder
parties' Common Stock under
6
the Stockholders Agreement, other than registration and filing fees, attorneys
fees for the selling stockholders, underwriter fees or expenses and underwriting
discounts and commissions. The Issuer also agreed upon the effectiveness of any
such registration, to indemnify such parties against any liabilities that may
result from their sale of Common Stock, including liabilities under the
Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as
amended.
Under the Stockholders Agreement, the Issuer also agreed that, for so long
as the Issuer or any of its affiliates are entitled to have a representative on
the Odyssey governance committee or is otherwise entitled to consent to the
taking of the following actions under the Amended and Restated Company Agreement
of Odyssey, effective as of November 13, 1998, as amended (the "Odyssey
Agreement"), and VISN and its affiliates either (a) are entitled to nominate to,
or designate a member of, the Issuer's Board of Directors or (b) beneficially
own any preferred interests in Odyssey Holdings, then neither the Issuer nor any
of its affiliates will, without the written consent of the member of the
Issuer's Board of Directors nominated by VISN or a representative of the
National Interfaith Cable Coalition, Inc. ("NICC"), vote in favor of:
o any specified change in, or action described in, the Odyssey Agreement
that relates to VISN's preferred interest in Odyssey (the "VISN
Preferred Interest") or that relates to VISN's rights to programming
on the Odyssey Network or its programming budget;
o any repayment or redemption of specified equity interests in Odyssey
that are junior to, or pari passu with, the VISN Preferred Interest;
o any transfer of all or substantially all of Odyssey's assets or any
business combination involving Odyssey where Odyssey is not the
surviving entity, unless the transferee assumes the VISN Preferred
Interest under the Odyssey Agreement until the later of the fifth
anniversary of the IPO or the second anniversary of the transfer or
business combination;
o the dissolution of Odyssey, except in connection with a complete
liquidation;
o any transfer of all or substantially all of Odyssey's assets to, or
any business combination involving Odyssey with, the Issuer or any of
its affiliates, or any other material transaction with the Issuer or
any of its affiliates, unless the Issuer complies with specified
restrictions relating to any financial benefit the Issuer receives
from the transaction that is more than what the Issuer would have
received had the transaction been on an arm's-length basis or on
commercially reasonable terms;
o any transfer of all or substantially all of Odyssey's assets or any
business combination involving Odyssey where Odyssey is not the
surviving entity, prior to the second anniversary of the IPO; or
7
o any amendment to the Odyssey Agreement that would result in none of
the Issuer or its affiliates having the right to consent to take any
of the actions listed in the above bullet points or which would result
in increased liability to VISN or an adverse change to its Capital
Account (as defined in the Odyssey Agreement).
The Issuer also agreed under the Stockholders Agreement not to transfer any
of its interest in Odyssey prior to the second anniversary of the IPO without
the consent of VISN or NICC. In addition, the Issuer agreed not to transfer any
of its interests in Odyssey after the second anniversary of the IPO unless the
transfer is conditioned on the requirement that the transferee assume the
Issuer's obligations described above. Under the terms of the Stockholders
Agreement, the transferee's obligations will generally expire on the later of
(1) the fifth anniversary of the IPO, (2) the second anniversary of the transfer
or (3) the repayment of VISN's preferred interest in Odyssey, except that the
obligations of the transferee will expire upon dissolution of Odyssey.
The foregoing summary is qualified in its entirety by reference to the text
of the Stockholders Agreement which is filed as an Exhibit hereto and hereby
incorporated by reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
See Exhibit Index.
SIGNATURES
After reasonable inquiry and to the best of our respective knowledge and
belief, the undersigned certify that the information set forth in this statement
is true, complete and correct.
Dated: March 26, 2001 THE JIM HENSON COMPANY, INC.
By: /s/ Peter Schube
---------------------------
Name: Peter Schube
Title: Secretary and Executive
Vice President for
Business & Legal Affairs
EM.TV & MERCHANDISING AG
By: /s/ Rolf Rickmeyer
---------------------------
Name: Rolf Rickmeyer
Title: Member of the Managing Board
By: /s/ Manfred Hohn
---------------------------
Name: Manfred Hohn
Title: Executive Vice President
8
SCHEDULE 1
The name and present principal occupation of each director and executive
officer of each of The Jim Henson Company, Inc. and EM.TV & Merchandising AG are
set forth below. The business address for the directors and executive officers
of The Jim Henson Company, Inc. is 1416 North La Brea Avenue, Hollywood, CA
90028. The business address for the directors and executive officers of EM.TV &
Merchandising AG is Betastrasse 11, 85774 Unterfohring, Germany.
THE JIM HENSON COMPANY, INC.
------------------------------------------------------------------------------------------
Brian Henson Director/Chairman United States citizen
------------------------------------------------------------------------------------------
Lisa Henson Director/Vice-Chairman United States citizen
------------------------------------------------------------------------------------------
Charles Rivkin Director/President and Chief United States citizen
Executive Officer
------------------------------------------------------------------------------------------
Thomas Haffa Director German citizen
------------------------------------------------------------------------------------------
Rolf Rickmeyer Director German citizen
------------------------------------------------------------------------------------------
Dr. Sylvia Rothblum Director Austrian citizen
------------------------------------------------------------------------------------------
Hans Peter Vriens Director German citizen
------------------------------------------------------------------------------------------
Peter Schube Exec. Vice President & Secretary United States citizen
------------------------------------------------------------------------------------------
Isabel Miller Exec. Vice President United States citizen
------------------------------------------------------------------------------------------
Linda Govreau Chief Financial Officer United States citizen
------------------------------------------------------------------------------------------
EM.TV. & MERCHANDISING AG
------------------------------------------------------------------------------------------
Thomas Haffa Chairman of the Managing Board German citizen
------------------------------------------------------------------------------------------
Rainer Huther Member of the Managing Board German citizen
------------------------------------------------------------------------------------------
Rolf Rickmeyer Member of the Managing Board German citizen
------------------------------------------------------------------------------------------
Dr. Sylvia Rothblum Member of the Managing Board Austrian citizen
------------------------------------------------------------------------------------------
Dr. Nickolaus Becker Member of the Supervisory Board German citizen
------------------------------------------------------------------------------------------
Prof. Dr. Axel Kollar Member of the Supervisory Board German citizen
------------------------------------------------------------------------------------------
Prof. Dr. Mathias Schwarz Member of the Supervisory Board German citizen
------------------------------------------------------------------------------------------
Dr. Volker Schott Executive Vice President German citizen
------------------------------------------------------------------------------------------
Manfred Hohn Executive Vice President German citizen
------------------------------------------------------------------------------------------
9
Exhibit Index
-------------
Exhibit Description
------- -----------
7.1 Contribution Agreement, dated as of March 15, 2001, by and among
The Jim Henson Company, Inc., Crown Media International, Inc. and
Crown Media Holdings, Inc.
7.2 Amended and Restated Stockholders Agreement, dated as of March
15, 2001, by and among Crown Media Holdings, Inc., Hallmark
Entertainment, Inc., Liberty Media Corporation, VISN Management
Corp., JP Morgan Partners (BHCA), L.P. and The Jim Henson
Company, Inc.
10