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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): December 13, 2013

 

__________________

 

SCHOLASTIC CORPORATION

(Exact Name of Registrant as Specified in Charter)

__________________

 

000-19860
(Commission File Number)

 

DELAWARE 13-3385513
(State or Other Jurisdiction
of Incorporation)  

(I.R.S. Employer

Identification No.)

 

 

557 BROADWAY, NEW YORK,

NEW YORK

 10012
(Address of Principal Executive Offices) (Zip Code)

 

(212) 343-6100
(Registrant’s telephone number, including area code)

 

N/A
(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 240.13e-4(c))
 

Item 1.01 Entry into a Material Definitive Agreement.

 

On December 13, 2013, Scholastic Inc. (the “Company”), the registrant’s principal operating subsidiary, delivered an acceptance of offer (“Acceptance Letter”) to purchase its headquarters space (both land and building) at 555 Broadway, New York, NY (the “Property”) from its landlord, ISE 555 Broadway, LLC (“Landlord”).

 

Under the terms of the Amended and Restated Lease effective as of August 1, 1999 between the Landlord and the Company, the Landlord was obligated to offer to sell the Property to the Company prior to marketing the Property for sale to a third party. Pursuant to Section 2.03 of the Lease, the Landlord made the required written offer pursuant to a notice dated October 16, 2013 (“Landlord’s Offer Notice”).

 

Under the terms of the Lease and the Landlord’s Offer Notice, by accepting the Landlord’s offer the Company is obligated to purchase the Property for $255 million in cash with no financing contingency, pursuant to a definitive contract of sale which must be executed within thirty (30) days of the receipt of the Company’s Acceptance Letter and which must be consistent with contracts for the sale of like property in the Borough of Manhattan. The Company will be required to deposit into escrow, with the Landlord’s counsel, $50 million upon execution of the definitive contract of sale as required by the Landlord’s Offer Notice. The transaction is to be completed by February 3, 2014, subject to the right of the Company to demand one thirty (30) day extension upon the payment of an additional $5 million into the escrow.

 

Copies of the Landlord’s Offer Notice and the Company’s Acceptance Letter are included herewith as Exhibit 99.1 to this current report on Form 8-K.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) The following exhibit is filed with this report on Form 8-K:

 

Exhibits

 

Number Description
   
99.1 Landlord’s Offer Notice dated October 16, 2013 and Company’s Acceptance Letter dated December 13, 2013.

 

 

 

 

SIGNATURES

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 hereunto duly authorized.

Date: December 19, 2013   SCHOLASTIC CORPORATION
    (Registrant)
     
     
   

/s/ Andrew S. Hedden

Name:  Andrew S. Hedden

Title:     Executive Vice President, General Counsel

     

 

 

 

INDEX TO EXHIBITS

 

 

 

Number Description
   
99.1 Landlord’s Offer Notice dated October 16, 2013 and Company’s Acceptance Letter dated December 13, 2013.

 

 

 

 

Exhibit 99.1

 

ISE 555 Broadway, LLC
c/o ISE America, Inc.
P.O. Box 267
Galena, MD 21635

 

October 16, 2013

 

By Hand and Certified Mail, Return Receipt Requested

 

Scholastic Inc.

557 Broadway

New York, New York 10012

Attn: Andrew S. Hedden
  Executive Vice President and General Counsel

 

Re: Amended and Restated Lease effective as of August 1, 1999 between ISE 555 Broadway, LLC (“Landlord”) and Scholastic Inc. (“Tenant”) relating to 555 Broadway, New York, New York  (the “Lease”)

 

Gentlemen:

 

Pursuant to Section 2.03 of the Lease, this notice shall constitute Landlord’s Offer. All capitalized terms contained, but not defined in, this Landlord’s Offer shall have the meanings ascribed to them in this Lease. The following are the material terms and conditions pursuant to which Landlord is offering to sell the Property to Tenant:

 

1.     Purchaser: Scholastic Inc. The Purchaser’s interest in and to the Purchase and Sale Agreement shall not be assignable to a third party.

 

2.     Purchase Price: $255 million, all cash, with no financing contingency.

 

3.     Deposit: $50 million, to be held in escrow by Landlord’s counsel.

 

4.     Closing Date: February 3, 2014, subject to one 30 day extension by Purchaser upon payment of an additional $5 million deposit into escrow.

 

5.     Condition of Property: As-is.

 

6.     Gallery Space. It is our present intention to vacate the gallery space at some point in time after the closing of the sale.

 

Kindly respond to this Landlord Offer in accordance with the provisions of the Lease.

 

  Very truly yours,
   
  ISE 555 BROADWAY, LLC
       
  By: ISE HIYOKO, INC.,
    Managing Member
       
  By:
    Name:  Gregg Clanton
    Title: Director

 

cc: Stroock & Stroock & Lavan LLP
  180 Maiden Lane
  New York, New York 10038
  Attn: Jacob Bart, Esq.
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Scholastic Inc. 557 Broadway, New York, NY 10012-3999, (212) 343-6700
www.scholastic.com

 

  Richard Robinson
  CEO, President & Chairman
  drobinson@schoIastic.com

 

December 13, 2013

 

By Hand Delivery

 

Ise 555 Broadway, LLC
c/o Ise America, Inc.
2063 Alexander Street
Newberry, South Carolina 29108

 

Attn: Gregg Clanton
   
Re: Amended and Restated Lease effective as of August 1, 1999 between Ise 555 Broadway, LLC (“Landlord”) and Scholastic Inc. (“Tenant”) relating to 555 Broadway, New York, New York (the “Lease”)

 

Gentlemen:

 

Reference is made to Landlord’s Offer set forth in Landlord’s notice to Tenant, dated October 16, 2013 (“Landlord’s Offer Notice”). All capitalized terms not defined in this letter shall have the meanings respectively ascribed to them in Landlord’s Offer Notice or the Lease.

 

Tenant hereby accepts Landlord’s Offer on the terms set forth in Landlord’s Offer Notice, and Tenant is prepared to consummate the purchase of the Property in accordance with the provisions of Section 2.03 of the Lease.

 

We look forward to completing the transaction with you.

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  Very truly yours,  
         
  Scholastic Inc.  
         
  By:  
    Name:  Richard Robinson  
    Title: Chairman, President and
Chief Executive Officer		  

 

cc: Loeb & Loeb LLP
  345 Park Avenue
  New York, NY 10154
  Attn: Kenneth W. Sold, Esq.

 

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