Print Page  Close Window

SEC Filings

S-4/A
RENAISSANCE MEDIA GROUP LLC filed this Form S-4/A on 08/06/1998
Entire Document
 
<PAGE>
 
and gas extraction industries dominate the local economy in the southern
portion of the system's service area, comprising a significant portion of the
manufacturing work force there. In the northern portion of the system's
service area, sugar is a prominent industry, as are other farming related
industries.
 
  The St. Landry System. The St. Landry system comprises four headends and
serves the communities of Jennings, Church Point, Eunice and Opelousas.
Located 61 miles from Baton Rouge, St. Landry's economy is primarily focused
on agriculture.
 
  The Picayune System. The Picayune system comprises one headend and serves
the communities of Picayune and parts of Pearl County. Picayune, 25 miles
northeast of Slidell and 60 miles northeast of New Orleans, is in Pearl
County, Mississippi. The John C. Stennis Space Center is one of the largest
employers in the Picayune area and is the main testing facility for NASA's
large propulsion systems including the Space Shuttle.
 
  The Pointe Coupee System. The Pointe Coupee system comprises one headend and
serves the community of New Roads and the Village of Morganza. Pointe Coupee
is a suburb of Baton Rouge and is Louisiana's second oldest settlement. Pointe
Coupee's major industry is agriculture.
 
  THE TENNESSEE SYSTEM
 
  As of March 31, 1998, the Tennessee System served 32,431 basic subscribers
located in Jackson, Tennessee and surrounding counties. The Tennessee System
is managed from the Regional Office located in Thibodaux, Louisiana. The
Tennessee System comprises five headends and serves the communities of
Jackson, Selmer, Bethel Springs, Adamsville, Camden, Alamo, Bells, Maury City,
Newbern, Trimble, Obion, Troy and the counties of Madison, Crockett, McNairy,
Benton, Dyer and Obion. Jackson is the medical, retail, cultural and
geographic center of west Tennessee. As of March 31, 1998, 22,948 basic
subscribers (excluding bulk subscribers), or three-quarters of the Tennessee
System's subscribers, were served from a single headend.
 
THE SOCIAL CONTRACT
 
  The Social Contract between Time Warner and the FCC, which became effective
on January 1, 1996, resolved certain outstanding cable rate cases involving
Time Warner that arose in connection with regulations promulgated by the FCC
pursuant to the 1992 Cable Act. The Social Contract established parameters
within which Time Warner and subsequent buyers of Time Warner's cable
television systems might determine certain subscriber rates and maintain a
high level of technical capacity in such systems. Among other obligations,
Time Warner agreed to upgrade one-half of its systems to 550 MHz capacity and
the balance to 750MHz capacity within the term of the Social Contract, of
which at least 200 MHz is expected to be allocated to digital compression
technology by January 1, 2001. In exchange, the Social Contract settled those
certain outstanding rate cases and established a right of Time Warner to
increase monthly CPST rates by an additional $1.00 per year above other
permissible increases resulting from inflation and so-called "external costs"
for the term of the Social Contract through the year 2000. The Social Contract
provides that Time Warner may petition the FCC to modify or terminate the
Social Contract based on any relevant change in applicable law, regulation or
circumstance.
 
  In connection with the Acquisition, the Company received the FCC's consent
to the assignment of the Social Contract as it applies to the Systems. By
assuming Time Warner's unsatisfied obligations with respect to the Systems,
the Company has gained certain rate benefits described above. The principal
remaining obligations of the Social Contract as they relate to the Systems
will be to upgrade the Tennessee System, the St. Landry system and
approximately one-half of the St. Tammany and Lafourche systems to 750 MHz
capacities. The failure to comply with the upgrade requirements will subject
the Company to refund liability under the terms of the Social Contract. The
Company also is required to ensure that at least 60% of new analog services in
the Systems are added to the CPST, and add at least 15 new channels on average
(weighted by CPST subscribers) to the CPST of the Systems. The Company
believes the upgrades are prudent both due to the competitive advantages to be
 
                                      49