Letter from Inverstors to Chuck: (Voom/Echostar merge?)

Alto101

Supporting Founder
Supporting Founder
Jan 15, 2005
161
0
Louisville, KY
March 3, 2005

Mr. Charles F. Dolan
Cablevision Systems Corporation
1111 Stewart Avenue
Bethpage, New York 11748-3581

Dear Chuck:

As you know, on February 28th, after failing to reach an agreement with VOOM HD, LLC concerning an acquisition of the VOOM assets that are not under contract to be sold to EchoStar Satellite L.L.C., the Special Committee and the Board determined that negotiations should cease and that the VOOM business should be shut down.

In a call with you yesterday morning, you told us that you intend to approach EchoStar to negotiate an arrangement whereby, with EchoStar’s agreement, Rainbow-1 could be brought together with the VOOM business outside of Cablevision. You agreed that whether you were able to succeed in that effort or not, Cablevision would get out of the satellite business, and you told us explicitly that you would not take any action to override any decision that the Board took on or before February 28th. For our part, we agreed to support a delay in the shutdown of VOOM for a short period while you engage in those discussions and that if you are able to negotiate such an arrangement with EchoStar on terms satisfactory to us, we would be prepared to renew discussions with you for a sale of the VOOM business, so long as the totality of such arrangements puts Cablevision in a significantly better position than it would be in were it to close the pending transaction with EchoStar and engage in a shutdown of the VOOM business.

We now understand that the VOOM business continues to take on subscribers and that this is being done, at least in part, through a newly-created web site (voomllc.com) remarkably similar to VOOM’s existing web site (voom.com). These efforts -- likely to deceive new subscribers and the public into believing that VOOM is still an authorized going business of Cablevision -- are in direct contradiction to the action taken by the Board on February 28th because they are an expansion rather than a shutdown of the business, and they are being done with funds that have not been authorized by the Board. To be clear, Cablevision had authorized funding for VOOM through February 28th, and the Board did not extend that funding beyond that date. It is imperative that this expansion of the business stop immediately and that actions taken by the Board be respected and carried out by the company’s officers.

We are very concerned that the VOOM situation resolve itself promptly. In all events, you must ensure that your actions do not jeopardize our obligations to EchoStar or delay the company’s exit from the VOOM business. If you are unable to come to terms with EchoStar in the very near future, we expect that you will honor your commitment to us to do nothing to impede a

shutdown of the VOOM business. We look forward to a report from you by our March 7th Board Meeting.

Sincerely,

/s/ Victor Oristano
Victor Oristano
On Behalf of the Independent Committee and the
Class A Directors
 

Walter L.

Supporting Founder
Supporting Founder
Mar 29, 2004
1,855
0
Portland, Oregon
This is obviously an internal memo and not a SEC filing as the name of this thread imply. What's your source? How can we know the memo is authentic.
 

Walter L.

Supporting Founder
Supporting Founder
Mar 29, 2004
1,855
0
Portland, Oregon
In a call with you yesterday morning, you told us that you intend to approach EchoStar to negotiate an arrangement whereby, with EchoStar’s agreement, Rainbow-1 could be brought together with the VOOM business outside of Cablevision."
This is a MAJOR development. Why C. Dolan needs to involve E*?
 

graphiteRT

SatelliteGuys Family
Jul 14, 2004
87
0
That's good stuff!

Well, for all those guessing about Chuck's plan of attack, that answers some questions. It also says that next Monday's meeting should be full of fireworks.
 

Bruce

That is my dog Bender.
Supporting Founder
Nov 29, 2003
6,473
6,424
Wow, read this carefully.


In a call with you yesterday morning, you told us that you intend to approach EchoStar to negotiate an arrangement whereby, with EchoStar’s agreement, Rainbow-1 could be brought together with the VOOM business outside of Cablevision. You agreed that whether you were able to succeed in that effort or not, Cablevision would get out of the satellite business, and you told us explicitly that you would not take any action to override any decision that the Board took on or before February 28th. For our part, we agreed to support a delay in the shutdown of VOOM for a short period while you engage in those discussions and that if you are able to negotiate such an arrangement with EchoStar on terms satisfactory to us, we would be prepared to renew discussions with you for a sale of the VOOM business, so long as the totality of such arrangements puts Cablevision in a significantly better position than it would be in were it to close the pending transaction with EchoStar and engage in a shutdown of the VOOM business.

Walter L. said:
This is a MAJOR development. Why C. Dolan needs to involve E*?

What that says to me is he is still looking for the money, and Charlie is the wrong person to be looking at for help, unless it is a international channel, he has no interest.
 

volfan615

Pub Member / Supporter
Pub Member / Supporter
Dec 3, 2003
89
0
Here is the pdf from their web site.
 

Attachments

  • CABLEVISIONSYST8K.pdf
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vurbano

On Double Secret Probation
Supporting Founder
Apr 1, 2004
23,813
104
Newport News, VA
Because Rainbow one is the only way for a smooth transition of customers to occur. This would also assure that the sale to E* would go through and Cablvision would get their check for 200 million from E*. Now we know why E* bought rainbow1, to lease it back to Dolan?
 

graphiteRT

SatelliteGuys Family
Jul 14, 2004
87
0
bruce said:
Wow, read this carefully.


In a call with you yesterday morning, you told us that you intend to approach EchoStar to negotiate an arrangement whereby, with EchoStar’s agreement, Rainbow-1 could be brought together with the VOOM business outside of Cablevision. You agreed that whether you were able to succeed in that effort or not, Cablevision would get out of the satellite business, and you told us explicitly that you would not take any action to override any decision that the Board took on or before February 28th. For our part, we agreed to support a delay in the shutdown of VOOM for a short period while you engage in those discussions and that if you are able to negotiate such an arrangement with EchoStar on terms satisfactory to us, we would be prepared to renew discussions with you for a sale of the VOOM business, so long as the totality of such arrangements puts Cablevision in a significantly better position than it would be in were it to close the pending transaction with EchoStar and engage in a shutdown of the VOOM business.

What that says to me is he is still looking for the money.

It doesn't say anything about money. It says he wants to dance with E*. If E* isn't interested, the money issue is moot.
 

ddlsmith

Supporting Founder
Supporting Founder
Nov 28, 2004
214
0
Is there a chance they could just get so p*ssed at him they just pull the plug and we all go black?
 

graphiteRT

SatelliteGuys Family
Jul 14, 2004
87
0
Admins need to jump on this as a sticky. The answers provided in that letter alone are HUGE.

-- voomllc.com is clearly a Dolan Sr. product.

-- It was done without the Board's blessing

-- Funding for continuing promotions to boost subs is technically unauthorized

-- Plans to work with E* have some TBD angle

-- CVC worried his actions could pooch the earlier E* deal
 

Bruce

That is my dog Bender.
Supporting Founder
Nov 29, 2003
6,473
6,424
I think a big thank you needs to go to Alto101, this is the biggest news in the last two days, and I think answers most, if not all of the big questions so far.
 

kex63

Member
Jan 18, 2005
11
0
I don't think they would care if the Echostar deal went south, just as long as they got their $200 million and got out of the DBS business. So if Dolan can assume the agreement assigned with Echostar..no big problem.
 

yanks2402

Enjoying FiOS TV
Supporting Founder
Oct 16, 2003
155
0
Tampa, FL
bruce said:
I think a big thank you needs to go to Alto101, this is the biggest news in the last two days, and I think answers most, if not all of the big questions so far.

Absolutely..great find!

Unfortunately with all news there only comes new questions...
 

riffjim4069

SatelliteGuys Master
Supporting Founder
Apr 7, 2004
35,213
287
SatelliteGuystonfieldville, U.S.A.
vurbano said:
Because Rainbow one is the only way for a smooth transition of customers to occur. This would also assure that the sale to E* would go through and Cablvision would get their check for 200 million from E*. Now we know why E* bought rainbow1, to lease it back to Dolan?
Yep, perhaps until Rainbow-3 is in the sky. Who knows what "other" tentative agreements may be in the works? I don't know, but Dolan Sr. appears to have a game plan and plan of action...now if he can only break-away from CVC. :mad:
 

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