def14a
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant þ
Filed by a Party other than the Registrant o
Check the appropriate box:
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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Soliciting Material Pursuant to §240.14a-12 |
Ascent Media Corporation
(Name of Registrant as Specified In Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the
filing for which the offsetting fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing. |
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Persons who are to respond to the collection of information
contained in this form are not required to respond unless the
form displays a currently valid OMB control number. |
ASCENT
MEDIA CORPORATION
12300 Liberty Boulevard
Englewood, Colorado 80112
(720) 875-5622
May 24,
2010
Dear Stockholder:
The 2010 annual meeting of stockholders of Ascent Media
Corporation will be held at 9:00 a.m., local time, on
July 9, 2010, at the Fairmont Miramar Hotel, 101 Wilshire
Boulevard, Santa Monica, California 90401,
Tel. No. (800) 257-7544.
At the annual meeting, you will be asked to consider and vote on
the re-election of two of our directors, the ratification of our
auditors and a stockholder proposal relating to the redemption
of rights issued pursuant to our shareholder rights plan, each
of which is described in greater detail in the accompanying
proxy statement.
Your vote is important, regardless of the number of shares
you own. Whether or not you plan to attend the annual meeting,
please read the accompanying proxy statement and then vote via
the Internet or telephone as promptly as possible.
Alternatively, request a paper proxy card to complete, sign and
return by mail. This will save us additional expense in
soliciting proxies and will ensure that your shares are
represented at the meeting. It will not, however, prevent you
from later revoking your proxy or changing your vote.
Thank you for your continued support and interest in our company.
Very truly yours,
William R. Fitzgerald
Chairman and Chief Executive Officer
The Notice of Internet Availability of Proxy Materials is
first being mailed on or about May 28, 2010, and the proxy
materials relating to the annual meeting will first be made
available on or about the same date.
ASCENT
MEDIA CORPORATION
12300 Liberty Boulevard
Englewood, Colorado 80112
(720) 875-5622
NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS
To Be Held on July 9,
2010
NOTICE IS HEREBY GIVEN of the annual meeting of
stockholders of Ascent Media Corporation to be held at
9:00 a.m., local time, on July 9, 2010, at the
Fairmont Miramar Hotel, 101 Wilshire Boulevard, Santa Monica,
California 90401, Tel. No.
(800) 257-7544,
to consider and vote on the following:
1. A proposal to re-elect Philip J. Holthouse and Brian C.
Mulligan to serve as the Class II members of our board of
directors until the 2013 annual meeting of stockholders (the
election of director proposal);
2. A proposal to ratify the selection of KPMG LLP as our
independent auditors for the fiscal year ending
December 31, 2010 (the auditors ratification
proposal); and
3. A stockholder proposal relating to the redemption of the
preferred share purchase rights issued pursuant to our Rights
Agreement dated September 17, 2008, as amended (which we
refer to as the Rights Plan) (the stockholder
proposal).
We describe the proposals in more detail in the accompanying
proxy statement. We encourage you to read the proxy statement in
its entirety before voting. You may also be asked to consider
and vote on any other business properly brought before the
annual meeting.
Holders of record of our Series A common stock, par value
$.01 per share, and Series B common stock, par value $.01
per share, outstanding as of 5:00 p.m., New York City time,
on May 20, 2010, the record date for the annual
meeting, will be entitled to notice of the annual meeting and to
vote at the annual meeting or any adjournment thereof. Holders
of Series A common stock and Series B common stock
will vote together as a single class on each proposal. A list of
stockholders entitled to vote at the annual meeting will be
available at our offices for review by our stockholders, for any
purpose germane to the annual meeting, for at least 10 days
prior to the annual meeting.
The following stockholder approvals are required with respect to
the matters described above:
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Approval of the election of director proposal requires the
affirmative vote of a plurality of the shares of our common
stock outstanding on the record date that are voted in person or
by proxy, voting together as a single class, at the annual
meeting. This means that Mr. Holthouse and
Mr. Mulligan will be elected if they receive more
affirmative votes than any other persons.
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Approval of the auditors ratification proposal and the
stockholder proposal requires the affirmative vote of a majority
of the voting power of the shares of our common stock
outstanding on the record date that are present in person or by
proxy, voting together as a single class, at the annual meeting.
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Our board of directors has carefully considered and approved
each of the election of director proposal and the auditors
ratification proposal and recommends that you vote FOR
each of these proposals. Our board of directors recommends
that you vote AGAINST the stockholder proposal described
above.
YOUR VOTE IS IMPORTANT. We urge you to vote as
soon as possible by telephone, Internet or mail.
By order of the board of directors,
William E. Niles
Executive Vice President,
General Counsel and Secretary
Englewood, Colorado
May 24, 2010
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE ANNUAL
MEETING, PLEASE VOTE AS PROMPTLY AS POSSIBLE BY TELEPHONE OR
INTERNET. ALTERNATIVELY, REQUEST A PAPER PROXY CARD TO COMPLETE,
SIGN AND RETURN BY MAIL.
TABLE OF
CONTENTS
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ASCENT
MEDIA CORPORATION
a Delaware corporation
12300 Liberty Boulevard
Englewood, Colorado 80112
(720) 875-5622
For Annual Meeting of
Stockholders
We are furnishing this proxy statement in connection with the
board of directors solicitation of proxies for use at our
2010 Annual Meeting of Stockholders to be held at
9:00 a.m., local time, at the Fairmont Miramar Hotel,
101 Wilshire Boulevard, Santa Monica, California 90401,
Tel. No.
(800) 257-7544,
on July 9, 2010, or at any adjournment or postponement of
the annual meeting. At the annual meeting, we will ask you to
consider and vote on the proposals described in the accompanying
Notice of Annual Meeting of Stockholders. The proposals are
described in more detail in this proxy statement. We are
soliciting proxies from holders of our Series A common
stock, par value $0.01 per share, and Series B common
stock, par value $0.01 per share.
ANNUAL
MEETING; PROXIES
Notice
and Access of Proxy Materials
We have elected, in accordance with the Securities and Exchange
Commissions Notice and Access rule, to deliver
a Notice of Internet Availability of Proxy Materials (the
Notice) to our stockholders and to post our proxy
statement and our annual report to our stockholders
(collectively, the proxy materials) electronically. The
Notice was first mailed to our stockholders on or about
May 28, 2010. The proxy materials are first being made
available to our stockholders on or about the same date.
The Notice instructs you how to access and review the proxy
materials and how to submit your proxy via the Internet or by
telephone. The Notice also instructs you how to request and
receive a paper copy of the proxy materials, including a proxy
card or voting instruction form, at no charge. We will not mail
a paper copy of the proxy materials to you unless specifically
requested to do so.
Electronic
Delivery
Registered stockholders may elect to receive future notices and
proxy materials by
e-mail. To
sign up for electronic delivery, go to
www.computershare.com/us/ecomms. You may also sign up for
electronic delivery when you vote by Internet at www.
envisionreports.com/ASCMA, by following the prompts. Once
you sign up, you will not receive a printed copy of the notices
and proxy materials, unless you request them. You may suspend
electronic delivery of the notices and proxy materials at any
time by contacting our transfer agent, Computershare, at
800-730-4001
(outside the United States
781-575-2879).
Stockholders who hold shares through a bank, brokerage firm or
other nominee may request electronic access by contacting their
nominee.
Time,
Place and Date
The annual meeting of the stockholders is to be held at
9:00 a.m., local time, on July 9, 2010, at the
Fairmont Miramar Hotel, 101 Wilshire Boulevard, Santa Monica,
California 90401, Tel. No.
(800) 257-7544.
Purpose
At the annual meeting, you will be asked to consider and vote on
each of the following:
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the election of directors proposal to re-elect Philip J.
Holthouse and Brian C. Mulligan to serve as Class II
members of our board of directors until the 2013 annual meeting
of stockholders;
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the auditors ratification proposal to ratify the selection of
KPMG LLP as our independent auditors for the fiscal year ending
December 31, 2010; and
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the stockholder proposal relating to the redemption of the
preferred share purchase rights issued pursuant to the Rights
Plan.
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You may also be asked to consider and vote on such other
business as may properly come before the annual meeting.
Quorum
In order to carry on the business of the annual meeting, a
quorum of stockholders must be present. This means that at least
a majority of the aggregate voting power represented by the
outstanding shares of our common stock as of the record date
must be present at the annual meeting, either in person or by
proxy. For purposes of determining a quorum, your shares will be
included as represented at the meeting even if you indicate on
your proxy that you abstain from voting. If a broker, who is a
record holder of shares, indicates on a form of proxy that the
broker does not have discretionary authority to vote those
shares on one or more of the proposals, or if those shares are
voted in circumstances in which proxy authority is defective or
has been withheld, those shares (which we refer to as broker
non-votes) nevertheless will be treated as present for
purposes of determining the presence of a quorum.
Who May
Vote; Record Date
Holders of our Series A common stock and Series B
common stock, as recorded in our stock register as of
5:00 p.m., New York City time, on May 20, 2010 (which
is the record date for the annual meeting), may vote at
the annual meeting or at any adjournment or postponement thereof.
Votes
Required
Approval of the election of director proposal requires the
affirmative votes of a plurality of the shares of our common
stock outstanding on the record date that are voted in person or
by proxy, voting together as a single class, at the annual
meeting. This means that Mr. Holthouse and
Mr. Mulligan will be elected if they receive more
affirmative votes than any other persons.
Approval of the auditors ratification proposal and stockholder
proposal requires the affirmative vote of a majority of the
voting power of the shares of our common stock outstanding on
the record date that are present in person or by proxy, voting
together as a single class, at the annual meeting.
Votes You
Have
At the annual meeting, holders of Series A common stock
will have one vote per share for each share of Series A
common stock that our records show they owned on the record
date, and holders of Series B common stock will have ten
votes per share for each share of Series B common stock
that our records show they owned on the record date. Holders of
all series of our common stock will vote together as a single
class.
Shares Outstanding
On the record date, 13,560,955 shares of our Series A
common stock and 734,027 shares of our Series B common
stock were outstanding.
Number of
Holders
As of the record date, there were approximately 1,256 and
68 record holders of Series A common stock and
Series B common stock, respectively.
Voting
Procedures for Record Holders
Holders of record of our common stock as of the record date may
vote in person at the annual meeting. Alternatively, they may
give a proxy by completing, signing, dating and returning the
proxy card, or by voting by telephone or over the Internet.
Unless subsequently revoked, shares of our common stock
represented by a proxy submitted as described below and received
at or before the annual meeting will be voted in accordance with
the instructions on the proxy.
2
YOUR VOTE IS IMPORTANT. It is recommended that
you vote by proxy even if you plan to attend the annual meeting.
You may change your vote at the annual meeting. Specific voting
instructions are set forth in this proxy statement and on both
the Notice and proxy card.
If a proxy is properly executed and submitted by a record holder
without indicating any voting instructions, the shares of our
common stock represented by the proxy will be voted FOR
the approval of each of the proposals.
If you submit a proxy card on which you indicate that you
abstain from voting, it will have no effect on the election of
director proposal but will have the same effect as a vote
AGAINST the auditors ratification proposal and the
stockholder proposal.
If you fail to respond with a vote, your shares will not be
counted as present and entitled to vote for purposes of
determining a quorum, and your failure to vote will have no
effect on determining whether any of the proposals are approved
(assuming a quorum is present).
Voting
Procedures for Shares Held in Street Name
General. If you hold your shares in the name
of a broker, bank or other nominee, you should follow the
instructions provided by your broker, bank or other nominee when
voting your shares of our common stock or when granting or
revoking a proxy.
Rule Change. Due to a recent rule change
by the New York Stock Exchange, brokers, banks and other
nominees are no longer authorized to vote shares on behalf of
their clients in any election of directors. Accordingly, to
ensure your shares held in street name are voted on the election
of directors proposal, we encourage you to provide specific
voting instructions to your broker, bank or other nominee
promptly.
Effect of Broker Non-Votes. Broker non-votes
are counted as shares of our common stock present and entitled
to vote for purposes of determining a quorum but will have no
effect on any of the proposals. You should follow the directions
your broker, bank or other nominee provides to you regarding how
to vote your shares of common stock or how to change your vote
or revoke your proxy.
Revoking
a Proxy
Before the start of the annual meeting, you may change your
vote, by voting in person at the annual meeting or by delivering
a signed proxy revocation or a new signed proxy with a later
date to Ascent Media Corporation,
c/o Computershare
Trust Company, N.A., 250 Royall Street, Canton, MA 02021.
Any proxy revocation or new proxy must be received before the
start of the annual meeting. In addition, you may change
your vote through the Internet or by telephone (if you
originally voted by the same method) not later than
1:00 a.m., Central time, on July 9, 2010.
Your attendance at the annual meeting will not, by itself,
revoke a prior vote or proxy from you. Please be sure to request
a ballot at the annual meeting if you have not voted or wish to
change your vote.
If your shares are held in an account by a broker, bank or other
nominee, you should contact your nominee to change your vote or
revoke your proxy.
Solicitation
of Proxies
The proxy for the annual meeting is being solicited on behalf of
our board of directors. In addition to this mailing, our
employees may solicit proxies personally or by telephone. We pay
the cost of soliciting these proxies. We also reimburse brokers
and other nominees for their expenses in sending these materials
to you and getting your voting instructions.
Recommendation
of Our Board of Directors
Our board of directors has approved the election of director
proposal and the auditors ratification proposal and recommends
that you vote FOR each of these proposals. Our board of
directors recommends that you vote AGAINST the
stockholder proposal.
3
Other
Matters to Be Voted on at the Annual Meeting
Our board of directors is not currently aware of any business to
be acted on at the annual meeting other than that which is
described in the Notice of Annual Meeting of Stockholders and
this proxy statement. If, however, other matters are properly
brought to a vote at the annual meeting, the persons designated
as proxies will have discretion to vote or to act on these
matters according to their best judgment, unless you indicate
otherwise in your proxy. In the event there is a proposal to
adjourn or postpone the annual meeting, the persons designated
as proxies will have discretion to vote on that proposal.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security
Ownership of Certain Beneficial Owners
The following table sets forth information concerning shares of
our common stock beneficially owned by each person or entity
(excluding any of our directors and executive officers) known by
us to own more than five percent of the outstanding shares of
any series of our common stock. All of such information is based
on publicly available filings.
The security ownership information is given as of March 31,
2010, and, in the case of percentage ownership information, is
based upon 13,560,855 shares of our Series A common
stock and 734,127 shares of our Series B common stock,
in each case, outstanding on that date. The percentage voting
power is presented on an aggregate basis for all series of
common stock.
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Name and Address
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Title of
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Amount and Nature of
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Percent of
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Voting
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of Beneficial Owner
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Class
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Beneficial Ownership
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Class
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Power
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Robert R. Bennett
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Series A
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17,980
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(1)(2)(3)
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*
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3.7
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%
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c/o Liberty
Media Corporation
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Series B
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76,212
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10.4
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%
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12300 Liberty Boulevard
Englewood, CO 80112
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BlackRock, Inc.
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Series A
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1,184,307
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(4)
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8.8
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5.7
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40 East 52nd Street
New York, NY 10022
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FMR LLC
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Series A
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857,185
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(5)
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6.4
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4.1
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82 Devonshire Street
Boston, MA 02109
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Mario J. Gabelli
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Series A
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1,177,969
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(6)
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8.8
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%
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5.6
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%
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c/o GAMCO
Investors, Inc.
One Corporate Center
Rye, NY 10580
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T. Rowe Price Associates, Inc.
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Series A
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873,977
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(7)
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6.5
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4.2
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100 E. Pratt Street
Baltimore, MD 21202
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Less than one percent. |
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(1) |
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Based upon the Schedule 13D filed on February 22, 2010
by Robert R. Bennett, which states that Mr. Bennett has
sole voting power and sole dispositive power over
17,980 shares of Series A common stock and
76,212 shares of Series B common stock. |
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(2) |
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Includes 12,472 shares of Series A Common Stock and
76,210 shares of Series B common stock jointly held by
Mr. Bennett and his wife, Deborah Bennett. Also includes
5,491 shares of Series A Common Stock and
2 shares of Series B Common Stock owned by Hilltop
Investments, LLC, which is jointly owned by Mr. Bennett and
his wife, Deborah Bennett. |
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Does not include beneficial ownership of shares of our
Series A common stock issuable upon exercise of conversion
rights relating to shares of our Series B common stock held
by Mr. Bennett. |
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Based upon the Schedule 13G filed on January 29, 2010
by BlackRock, Inc., which states that BlackRock, Inc., a parent
holding company, has sole voting power and sole dispositive
power over 1,184,307 shares. All shares covered by the
Schedule 13G are held by subsidiaries of BlackRock, Inc. |
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(5) |
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Based upon Amendment No. 1 to Schedule 13G filed on
February 16, 2010 by FMR LLC, a parent holding company
(FMR). Fidelity Management & Research Company,
a wholly-owned subsidiary of FMR, is the beneficial owner of
781,124 shares as a result of acting as an investment
adviser. Strategic Advisers, Inc., a wholly-owned subsidiary of
FMR (SAI), is the beneficial owner of 11 shares as a
result of acting as an investment adviser. Pyramis Global
Advisors Trust Company, an indirect wholly-owned subsidiary
of FMR (PGATC), is the beneficial owner of
76,050 shares as a result of acting as an investment
manager. The Schedule 13G states that FMR has sole voting
power over the 76,061 shares beneficially owned by SAI and
PGATC and sole dispositive power over 857,185 shares. |
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(6) |
|
Based upon Amendment No. 9 to Schedule 13D filed on
March 15, 2010 by Gabelli Funds, LLC, GAMCO Asset
Management Inc., Gabelli Securities, Inc., Teton Advisors, Inc.,
Gabelli Foundation, Inc., GGCP, Inc., GAMCO Investors, Inc. and
Mario J. Gabelli (whom we collectively refer to as the
Gabelli Reporting Persons). In addition to shares of our
Series A common stock held directly by Mr. Gabelli,
Mr. Gabelli is deemed to have beneficial ownership of those
shares of our common stock held by the other Gabelli Reporting
Persons. The Schedule 13D states that Mr. Gabelli has
sole voting power and sole dispositive power over
1,300 shares. |
|
(7) |
|
Based upon Amendment No. 2 to Schedule 13G filed on
February 12, 2010 by T. Rowe Price Associates, Inc. (T.
Rowe Price), an investment advisor, which states that T.
Rowe Price has sole voting power over 241,429 shares and
sole dispositive power over 873,977 shares. T. Rowe Price
is deemed the beneficial owner of such shares as a result of
acting as an investment advisor. |
Security
Ownership of Management
The following table sets forth information with respect to the
ownership by each of our directors, each of our named executive
officers (as defined below) and by all of our directors and
executive officers as a group, of shares of Series A common
stock and Series B common stock. The security ownership
information is given as of March 31, 2010, and, in the case
of percentage ownership information, is based upon
13,560,855 shares of Series A common stock and
734,127 shares of Series B common stock, in each case,
outstanding on that date. Such outstanding share amounts do not
include shares of our common stock that may be issued upon the
exercise of stock options, including stock options disclosed in
the table below. The percentage voting power is presented in the
table below on an aggregate basis for all series of common stock.
Shares of restricted stock that have been granted pursuant to
our equity incentive plans are included in the outstanding share
numbers provided throughout this proxy statement. Shares of
common stock issuable upon exercise or conversion of options,
warrants and convertible securities that, as of March 31,
2010, were exercisable or convertible on such date or within
60 days thereafter, are deemed to be outstanding and to be
beneficially owned by the person holding the options, warrants
or convertible securities for the purpose of computing the
percentage ownership of the person, but are not treated as
outstanding for the purpose of computing the percentage
ownership of any other person. For purposes of the following
presentation, any beneficial ownership of shares of our
Series B common stock, though convertible on a
one-for-one
basis into shares of our Series A common stock, is reported
as beneficial ownership of our Series B common stock only,
and not as beneficial ownership of our Series A common
stock. So far as is known to us, the persons indicated below
have sole voting power with respect to the shares indicated as
owned by them, except as otherwise stated in the notes to the
table.
5
|
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|
|
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|
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|
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Title of
|
|
Amount and Nature of
|
|
Percent of
|
|
Voting
|
Name of Beneficial Owner
|
|
Class
|
|
Beneficial Ownership
|
|
Class
|
|
Power
|
|
William R. Fitzgerald
|
|
|
Series A
|
|
|
|
192,083
|
(1)(2)
|
|
|
1.4
|
%
|
|
|
*
|
|
Chairman of the Board and
|
|
|
Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Philip J. Holthouse
|
|
|
Series A
|
|
|
|
13,468
|
(1)(2)(3)
|
|
|
*
|
|
|
|
*
|
|
Director
|
|
|
Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John C. Malone
|
|
|
Series A
|
|
|
|
150,617
|
(4)(5)(6)
|
|
|
1.1
|
%
|
|
|
30.3
|
%
|
Director
|
|
|
Series B
|
|
|
|
618,525
|
|
|
|
84.3
|
%
|
|
|
|
|
Brian C. Mulligan
|
|
|
Series A
|
|
|
|
13,448
|
(1)(2)
|
|
|
*
|
|
|
|
*
|
|
Director
|
|
|
Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William E. Niles
|
|
|
Series A
|
|
|
|
10,410
|
(1)(2)
|
|
|
*
|
|
|
|
*
|
|
Executive Vice President,
|
|
|
Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General Counsel and Secretary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John A. Orr
|
|
|
Series A
|
|
|
|
67,548
|
(1)(2)
|
|
|
*
|
|
|
|
*
|
|
Senior Vice President
|
|
|
Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|
George C. Platisa
|
|
|
Series A
|
|
|
|
10,410
|
(1)(2)
|
|
|
*
|
|
|
|
*
|
|
Executive Vice President and
|
|
|
Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael J. Pohl
|
|
|
Series A
|
|
|
|
13,448
|
(1)(2)
|
|
|
*
|
|
|
|
*
|
|
Director
|
|
|
Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jose A. Royo(7)
|
|
|
Series A
|
|
|
|
16,502
|
(1)(2)
|
|
|
*
|
|
|
|
*
|
|
President, Chief Operating
|
|
|
Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Officer and Director
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carl E. Vogel
|
|
|
Series A
|
|
|
|
3,830
|
(1)
|
|
|
*
|
|
|
|
*
|
|
Director
|
|
|
Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All directors and executive officers as a group (10 persons)
|
|
|
Series A
|
|
|
|
491,764
|
(1)(2)(3)(4)(5)(6)
|
|
|
3.6
|
%
|
|
|
31.6
|
%
|
|
|
|
Series B
|
|
|
|
618,525
|
(4)(5)
|
|
|
84.3
|
%
|
|
|
|
|
|
|
|
* |
|
Less than one percent |
|
(1) |
|
Includes, as applicable, the following restricted shares of our
Series A common stock which remain subject to vesting as of
March 31, 2010: |
|
|
|
|
|
Name
|
|
Restricted Shares
|
|
William R. Fitzgerald
|
|
|
61,570
|
|
Philip J. Holthouse
|
|
|
3,958
|
|
Brian C. Mulligan
|
|
|
3,958
|
|
William E. Niles
|
|
|
1,330
|
|
John A. Orr
|
|
|
21,590
|
|
George C. Platisa
|
|
|
1,330
|
|
Michael J. Pohl
|
|
|
3,958
|
|
Jose A. Royo
|
|
|
2,660
|
|
Carl E. Vogel
|
|
|
3,352
|
|
|
|
|
(2) |
|
Includes, as applicable, beneficial ownership of the following
shares of our Series A common stock that may be acquired
upon exercise of stock options that are exercisable within
60 days of March 31, 2010: |
|
|
|
|
|
Name
|
|
Option Shares
|
|
William R. Fitzgerald
|
|
|
104,115
|
|
Philip J. Holthouse
|
|
|
8,271
|
|
Brian C. Mulligan
|
|
|
8,271
|
|
William E. Niles
|
|
|
8,637
|
|
John A. Orr
|
|
|
36,537
|
|
George C. Platisa
|
|
|
8,637
|
|
Michael J. Pohl
|
|
|
8,271
|
|
Jose A. Royo
|
|
|
12,956
|
|
6
|
|
|
(3) |
|
Includes 20 shares of our Series A common stock owned
by Mr. Holthouse jointly with his wife. |
|
(4) |
|
Includes 26,833 shares of our Series A common stock
and 17,046 shares of our Series B common stock held by
Mr. Malones wife, Leslie Malone, as to which shares
Mr. Malone has disclaimed beneficial ownership. |
|
(5) |
|
Includes 16 and 55,317 shares of our Series A common
stock held by two trusts with respect to which Mr. Malone
is the sole trustee and, with his wife, retains a unitrust
interest in the trust. Also includes 2,570 shares of our
Series A common stock and 9,178 shares of our
Series B common stock held by two trusts which are managed
by an independent trustee, of which the beneficiaries are
Mr. Malones adult children and in which
Mr. Malone has no pecuniary interest. Mr. Malone
retains the right to substitute assets held by the trusts but
has disclaimed beneficial ownership of the shares held by the
trusts for the benefit of his children. |
|
(6) |
|
Includes 1 share of our Series A common stock held by
an IRA account. |
|
(7) |
|
Mr. Royo served as our President, Chief Operating Officer
and director until his passing on May 18, 2010. |
Changes
in Control
We know of no arrangements, including any pledge by any person
of our securities, the operation of which may at a subsequent
date result in a change in control of our company.
7
PROPOSAL 1
THE ELECTION OF DIRECTOR PROPOSAL
Board of
Directors
Our company is governed by a board of directors. Pursuant to our
bylaws, the size of the board shall be not less than three nor
more than nine members, with the exact number of directors fixed
from time to time by resolution adopted by affirmative vote of
at least 75% of the directors then in office. The number of
directors constituting the whole board is currently fixed at
seven. As a result of the passing of Mr. Jose A. Royo on
May 18, 2010, there are currently six directors on the
board. Our board of directors may appoint a director to fill the
vacancy created by Mr. Royos passing, but has not yet
done so.
Our board of directors is divided into three classes. Our
Class II directors, whose term will expire at the annual
meeting, are Philip J. Holthouse and Brian C. Mulligan. These
directors have been nominated for re-election to our board to
continue to serve as Class II directors, and we have been
informed that Mr. Holthouse and Mr. Mulligan are
willing to continue to serve as directors of our company. The
term of the Class II directors who are elected at the
annual meeting will expire at the annual meeting of our
stockholders in the year 2013. Our Class III director,
whose term will expire at the annual meeting of our stockholders
in the year 2011, is William R. Fitzgerald. Mr. Royo was
also a Class III director. Our Class I directors,
whose term will expire at the annual meeting of our shareholders
in year 2012, are John C. Malone, Michael J. Pohl and Carl E.
Vogel.
If any nominee should decline re-election or should become
unable to serve as a director of our company for any reason
before re-election, votes will be cast for a substitute nominee,
if any, designated by the board of directors, or, if none is so
designated prior to the election, votes will be cast according
to the judgment of the person or persons voting the proxy.
The following lists the two nominees for election as directors
at the annual meeting and the five other directors of our
company as of May 17, 2010, and includes as to each person
how long such person has been a director of our company, such
persons professional background, other public company
directorships and other factors considered in the determination
that such person possesses the requisite qualifications and
skills to serve as a member of our board of directors. All
positions referenced in the table below with our company
include, where applicable, positions with our predecessors. The
number of shares of our common stock beneficially owned by each
director, as of March 31, 2010, is set forth in this proxy
statement under the caption Security Ownership of Certain
Beneficial Owners and Management Security Ownership
of Management.
Nominees
for Election as Director
Philip
J. Holthouse
|
|
|
|
|
Professional Background: A director of our
company since September 2008. Mr. Holthouse is a partner
with Holthouse Carlin & Van Trigt LLP, where he
provides tax planning and tax consulting services for privately
held businesses and high net-worth individuals primarily in the
real estate, entertainment and service industries.
|
|
|
|
Other Public Company
Directorships: Mr. Holthouse served on the
board and audit committee of Napster, Inc. from January 2004 to
October 2008.
|
|
|
|
Age: 51
|
|
|
|
Board Qualification: Mr. Holthouse brings
to our board experience as a public company director and an
audit committee member, coupled with an understanding of the
entertainment and service industries in which we operate. His
tax and accounting training enables him to provide our board
with sophisticated financial insight.
|
Brian
C. Mulligan
|
|
|
|
|
Professional Background: A director of our
company since September 2008. Mr. Mulligan is the vice
chairman of the media and telecom group of Deutsche Bank
Securities. From February 2005 through August 2009,
Mr. Mulligan was chairman of Brooknol Advisors, LLC, an
advisory and investment firm specializing
|
8
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|
|
in media and entertainment. From April 2004 through January
2005, Mr. Mulligan was a senior executive
advisor media and entertainment with Cerberus
Capital Management, L.P., an investment firm. From September
2002 to March 2004, Mr. Mulligan was a founder of and
principal with Universal Partners, a group formed to acquire
Universal Entertainment. Prior to that, Mr. Mulligan held
various senior-level positions, including senior executive
advisor with The Boston Consulting Group, Inc., chairman for Fox
Television, Inc., chief financial officer of The Seagram Company
Ltd., an entertainment and beverage company, co-chairman of
Universal Pictures, Inc., executive vice president of operations
at Universal Entertainment and executive vice
president corporate development and strategy at MCA
Inc., an entertainment and media conglomerate.
|
|
|
|
|
|
Other Public Company
Directorships: Mr. Mulligan served on the
board of Napster, Inc. from March 2003 to October 2008 and was a
director of Ascent Media Group, Inc., a predecessor of Ascent
Media Group, LLC, our principal operating subsidiary
(AMG), from December 2002 to September 2003.
|
|
|
|
Age: 50
|
|
|
|
Board Qualification: Mr. Mulligan brings
to our board extensive executive experience in the entertainment
and media sector coupled with financial expertise and the
perspective of an investment banker. In addition, having
previously served as a director of AMG, he has an understanding
of our operating business and the history of our organization.
|
Directors
Whose Term Expires in 2011
William
R. Fitzgerald
|
|
|
|
|
Professional Background: A director of our
company since September 2008. Mr. Fitzgerald is Chairman of
the Board and Chief Executive Officer of our company.
Mr. Fitzgerald has served as Chairman of AMG since July
2000. Mr. Fitzgerald has also served as a Senior Vice
President of Liberty Media Corporation (Liberty Media), a
media and communications company, since July 2000. Prior to
joining Liberty Media, Mr. Fitzgerald served as Executive
Vice President and Chief Operating Officer, Operations
Administration for AT&T Broadband (formerly known as
Tele-Communications, Inc. (TCI)), a cable televisions
company, from 1999 to 2000 and was Executive Vice President and
Chief Operating Officer of TCI Communications, Inc., a
wholly-owned subsidiary of TCI, from 1998 to 1999.
|
|
|
|
Other Public Company
Directorships: Mr. Fitzgerald has served as
a director of Expedia, Inc. since March 2006. In addition,
Mr. Fitzgerald served as a director of Cablevision Systems
Corporation from 1999 to 2000.
|
|
|
|
Age: 52
|
|
|
|
Board Qualification: Mr. Fitzgerald
brings to our board 30 years of experience in the media and
telecommunications industries. He has an in-depth understanding
of our operating business and the history of our organization
coupled with significant executive and leadership experience.
|
Jose
A. Royo
|
|
|
|
|
Professional Background: A director of our
company from September 2008. Mr. Royo served as President
and Chief Executive Officer of AMG from February 2008, and from
the spin-off also served as President and Chief Operating
Officer of our company. From July 2001 until his appointment as
CEO, Mr. Royo served in various positions at AMG, including
Vice President of the New Products Division, Senior Vice
President of the Digital Services Group, and Chief Technology
Officer. Mr. Royo passed away on May 18, 2010.
|
|
|
|
Other Public Company Directorships: None.
|
|
|
|
Age: 44
|
|
|
|
Board Qualification: Mr. Royo brought to
our board an intimate knowledge of our business and our
technology which was acquired as he rose through the management
ranks of our company. Considered a true
|
9
|
|
|
|
|
leader in our organization, his experience assisted our board in
formulating strategic alternatives and creating a long-term
vision.
|
Directors
Whose Term Expires in 2012
John
C. Malone
|
|
|
|
|
Professional Background: A director of our
company since January 2010. Mr. Malone has served as the
Chairman of the Board and a director of Liberty Media since
1994, as the Chief Executive Officer of Liberty Media from
August 2005 to February 2006 and as the Chief Executive Officer
of TCI from January 1994 to March 1997.
|
|
|
|
Other Public Company
Directorships: Mr. Malone has served as the
Chairman of the Board of Liberty Global, Inc. (LGI) since
June 2005 and Chairman of the Board of DIRECTV since November
2009. Previously, he served as Chairman of the Board of
LGIs predecessor, Liberty Media International, Inc., from
March 2004 to June 2005, as Chairman of the Board of
DIRECTVs predecessor, The DIRECTV Group, Inc., from
February 2008 to November 2009 and as Chairman of the Board of
TCI from November 1996 until March 1999. He has served as a
director of Discovery Communications Inc. since September 2008
and served as Chairman of the Board of its predecessor,
Discovery Holding Corporation (DHC), from March 2005 to
September 2008, and as a director of DHC from May 2005 to
September 2008. Mr. Malone has served as a director of
(i) InterActiveCorp since May 2006, (ii) Expedia, Inc.
since August 2005, (iii) Sirius XM Radio Inc.
(Sirius) since April 2009 and (iv) Live Nation
Entertainment, Inc. since January 2010. Mr. Malone served
as a director of (i) the Bank of New York Company, Inc.
from June 2005 to April 2007, (ii) Cablevision Systems
Corp. from March 2005 to June 2005 and
(iii) UnitedGlobalCom, Inc. from January 2002 to June 2005.
|
|
|
|
Age: 69
|
|
|
|
Board Qualification: Mr. Malone, as
President of TCI, co-founded Liberty Media and is considered one
of the preeminent figures in the media and telecommunications
industry. He is well known for his sophisticated problem solving
and risk assessment skills and provides our board with executive
leadership experience and long-term vision.
|
Michael
J. Pohl
|
|
|
|
|
Professional Background: A director of our
company since September 2008. Mr. Pohl serves as an advisor
to companies in the technology, media and telecommunications
industries. From December 2008 through April 2009, Mr. Pohl
served as a consultant to ARRIS Group, Inc., a communications
technology company specializing in the design and engineering of
broadband networks, where he served as the interim Vice
President and General Manager of the On Demand Systems Division
from December 2007 through December 2008. Mr. Pohl was
President of Global Strategies at C-COR Incorporated from
January 2005 to December 2007, when C-COR Incorporated was
acquired by ARRIS Group, Inc. Mr. Pohl served as the
President and Chief Executive Officer of nCUBE Corporation from
1999 to 2005.
|
|
|
|
Other Public Company
Directorships: Mr. Pohl has served on the
board and compensation committee of BigBand Networks, Inc.
(BigBand) since May 2009 and on its audit committee since
June 2009. In addition, Mr. Pohl was appointed as Chairman
of the Board of BigBand in February 2010.
|
|
|
|
Age: 58
|
|
|
|
Board Qualification: Mr. Pohl brings to
our board valuable technological insight and 25 years of
extensive experience in the media and telecommunications
industries. His management experience and financial expertise is
complemented by his knowledge of applied sciences.
|
Carl
E. Vogel
|
|
|
|
|
Professional Background: A director of our
company since December 2009. Mr. Vogel is currently a
Senior Advisor to DISH Networks Corporation (DISH), a
publicly-traded company providing
pay-TV
|
10
|
|
|
|
|
services, and served as President of DISH from September 2006
until February 2008 and Vice Chairman of DISH from June 2005
until March 2009. Mr. Vogel is also a partner of SCP
Worldwide LLC, a sports, media and entertainment company that
owns and operates a variety of companies including the
St. Louis Blues of the National Hockey League and Real Salt
Lake of Major League Soccer. From October 2007 until March 2009,
Mr. Vogel served as a Senior Advisor to EchoStar
Corporation (EchoStar), a publicly-traded company in the
digital set-top box and satellite services businesses. From 2001
until 2005, Mr. Vogel served as the President and CEO of
Charter Communications Inc. (Charter), a publicly-traded
company providing cable television and broadband services. Prior
to joining Charter, Mr. Vogel worked as an executive
officer in various capacities for companies affiliated with
Liberty Media. Mr. Vogel held various executive positions
with DISH from 1994 until 1997, including serving as the
President from 1995 until 1997.
|
|
|
|
|
|
Other Public Company
Directorships: Mr. Vogel has served on the
board of DISH since May 2005. In addition Mr. Vogel is
serving on the board of directors and audit committees of Shaw
Communications, Inc., Universal Electronics Inc. and NextWave
Wireless Inc. Mr. Vogel is also currently serving as the
chair of NextWave Wireless Inc.s audit committee. From
October 2007 until March 2009, Mr. Vogel served as the Vice
Chairman of the board of directors of EchoStar. From October
2001 to January 2005, Mr. Vogel served on the board of
Charter.
|
|
|
|
Age: 52
|
|
|
|
Board Qualification: Mr. Vogel brings to
our board of directors extensive executive leadership experience
and board experience in the media and telecommunications
industries, along with professional accounting and financial
expertise.
|
Vote and
Recommendation
Approval of the election of director proposal requires the
affirmative votes of a plurality of the shares of our common
stock outstanding on the record date that are voted, in person
or by proxy, at the annual meeting. This means that
Mr. Holthouse and Mr. Mulligan will be elected if they
receive more affirmative votes than any other persons.
Our board of directors unanimously recommends a vote FOR
the election of the nominees to our board of directors.
PROPOSAL 2
THE AUDITORS RATIFICATION PROPOSAL
We are asking our stockholders to ratify the selection of KPMG
LLP as our independent auditors for the fiscal year ending
December 31, 2010.
Even if the selection of KPMG LLP is ratified, the audit
committee of our board in its discretion may direct the
appointment of a different independent accounting firm at any
time during the year if our audit committee determines that such
a change would be in the best interests of our company and our
stockholders. In the event our stockholders fail to ratify the
selection of KPMG LLP, our audit committee will consider it as a
direction to select other auditors for the year ending
December 31, 2010.
A representative of KPMG LLP is expected to be present at the
annual meeting, will have the opportunity to make a statement if
he or she so desires and is expected to be available to respond
to appropriate questions.
11
Audit
Fees and All Other Fees
The following table presents fees for professional audit
services rendered by KPMG LLP for the audit of our consolidated
financial statements for 2009 and 2008, and fees billed for
other services rendered by KPMG LLP following the spin-off of
our company from DHC in September 2008:
|
|
|
|
|
|
|
|
|
|
|
2009
|
|
|
2008
|
|
|
Audit fees
|
|
$
|
1,228,444
|
|
|
|
1,052,352
|
|
Audit related fees(1)
|
|
|
67,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Audit and audit related fees
|
|
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1,295,444
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|
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1,052,352
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Tax fees(2)
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|
224,049
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72,847
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Total fees
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$
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1,519,493
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|
|
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1,125,199
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(1) |
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Audit related fees consist of audits of financial statements of
certain employee benefit plans. |
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(2) |
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Tax fees consist of tax compliance and consultations regarding
the tax implications of certain transactions. |
Our audit committee has considered whether the provision of
services by KPMG LLP to our company other than auditing is
compatible with KPMG LLP maintaining its independence and
believes that the provision of such other services is compatible
with KPMG LLP maintaining its independence.
Policy on
Pre-Approval of Audit and Permissible Non-Audit Services of
Independent Auditor
Our audit committee adopted a policy dated November 6, 2008
regarding the pre-approval of all audit and permissible
non-audit services provided by our independent auditor. Pursuant
to this policy, our audit committee has approved the engagement
of our independent auditor to provide the following services
(all of which are collectively referred to as pre-approved
services):
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audit services as specified in the policy, including
(i) financial audits of our company and our subsidiaries,
(ii) services associated with our periodic reports,
registration statements and other documents filed or issued in
connection with a securities offering (including comfort letters
and consents), (iii) attestations of our managements
reports on internal controls and (iv) consultations with
management as to accounting or disclosure treatment of
transactions;
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audit-related services as specified in the policy, including
(i) due diligence services, (ii) financial audits of
employee benefit plans, (iii) consultations with management
as to accounting or disclosure treatment of transactions not
otherwise considered audit services, (iv) attestation
services not required by statute or regulation, (v) certain
audits incremental to the audit of our consolidated financial
statements, (vi) closing balance sheet audits related to
dispositions and (vii) general assistance with
implementation of Securities and Exchange Commission
(SEC) rules or listing standards; and
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tax services as specified in the policy, including federal,
state, local and international tax planning, compliance and
review services, and tax due diligence.
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Notwithstanding the foregoing general pre-approval, any
individual project involving the provision of pre-approved
services that is likely to result in fees in excess of $100,000
requires the specific prior approval of our audit committee. Any
engagement of our independent auditors for services other than
the pre-approved services requires the specific approval of our
audit committee. Our audit committee has delegated the authority
for the foregoing approvals to the chairman of the audit
committee, subject to his subsequent disclosure to the entire
audit committee of the granting of any such approval. Philip J.
Holthouse currently serves as the chairman of our audit
committee.
Our pre-approval policy prohibits the engagement of our
independent auditor to provide any services that are subject to
the prohibition imposed by Section 201 of the
Sarbanes-Oxley Act.
All services provided by our independent auditor during 2009
were approved in accordance with the terms of the policy.
12
Vote and
Recommendation
Approval of the auditors ratification proposal requires the
affirmative vote of a majority of the voting power of the shares
of our common stock outstanding on the record date that are
present, in person or by proxy, voting together as a single
class, at the annual meeting.
Our board of directors unanimously recommends a vote FOR
the auditors ratification proposal.
PROPOSAL 3
THE STOCKHOLDER PROPOSAL
We received the following resolution and supporting statement
sponsored by GAMCO Asset Management Inc. and the following
affiliated stockholders: GAMCO Investors, Inc., Gabelli Funds,
LLC, Gabelli Securities, Inc., MJG Associates, Inc., Teton
Advisors, Inc., Gabelli Foundation, Inc., GGCP, Inc., and Mario
J. Gabelli. Information regarding these stockholders is
available under Security Ownership of Certain Beneficial
Owners and Management Security Ownership of Certain
Beneficial Owners. In addition, the address and stock
ownership for these stockholders, as they provided to us, will
be furnished promptly to any stockholder of record upon oral or
written request to our Secretary at our offices. We are
including the stockholder proposal in this proxy statement in
accordance with
Rule 14a-8
of the Securities Exchange Act of 1934, as amended (the
Exchange Act).
The following stockholder proposal and supporting statement is
presented verbatim and in its entirety as submitted by the above
stockholders. We have not undertaken any review of the veracity
or relevance of the statements and are not responsible for the
accuracy or inaccuracy of any statements contained therein.
RESOLVED: that the stockholders of Ascent Media
Corporation (the Company) request the Board of
Directors redeem the preferred share purchase rights issued
pursuant to the Rights Agreement, dated as of September 17,
2008, as amended, unless the holders of a majority of the
outstanding shares of common stock approve the issuance at a
meeting of the stockholders held as soon as practical.
SUPPORTING
STATEMENT:
As of September 17, 2008, the Board of Directors adopted a
Rights Agreement. The Rights represent a corporate anti-takeover
device, commonly known as a poison pill. Absent
Board intervention, the Rights are exercisable when a person or
group acquires a beneficial interest in 15% or more of the
outstanding common stock of the Company. Under certain
circumstances, the Rights may be exercisable when a person or
group acquires a beneficial interest in 10% or more of the
outstanding common stock of the Company. Once exercisable, the
Rights entitle holders to purchase shares of the Companys
Junior Participating Preferred Stock.
We oppose the use of Rights to prevent a potential bidder from
effecting any merger or tender offer that is not approved by the
Board of Directors. A poison pill stops a potential bidder from
taking their offer directly to the stockholders even if an
overwhelming majority would have accepted the offer. The
potential bidder must instead negotiate with management, and a
Board or management may sometimes have interests that conflict
with interests of the stockholders. In effect, the pill allows a
Board to arrogate to itself the sole right to determine what
price a potential buyer must pay to acquire the entire company.
The power of stockholders to accept an offer by a potential
bidder provides an important check and balance on management and
the Board in their stewardship of the stockholders
interests. We believe the stockholders should retain the right
to decide for themselves what represents a fair price for their
holdings.
WE URGE STOCKHOLDERS TO VOTE IN FAVOR OF THIS PROPOSAL.
Our board of directors unanimously recommends a vote AGAINST
the Stockholder Proposal.
If adopted, the Stockholder Proposal would constitute a
non-binding request that the board redeem the preferred share
purchase rights issued pursuant to our Rights Plan.
13
Our board believes that it would be a mistake to terminate the
Rights Plan at this time, and that requiring an unnecessary
stockholder vote on this issue would waste corporate resources
and undermine the boards fundamental role to direct the
management of the business and affairs of the company in
accordance with the interests of all stockholders.
Our companys board of directors adopted the Rights Plan to
enhance the ability of the board, in a manner consistent with
its fiduciary duties, to preserve and protect stockholder value
in the event of certain unsolicited takeover attempts. The
Rights Plan encourages potential acquirers to negotiate directly
with our board of directors, which strengthens our
companys bargaining position with the bidder. Our board
believes that it is in the best position to negotiate on behalf
of all stockholders, to evaluate the adequacy of any potential
offer, and to protect stockholders against potential abuses
during the takeover process. The opportunity of the board of
directors to seek a higher price on behalf of all stockholders
in a takeover contest is significantly greater than the ability
of any individual stockholder to seek a higher price on its own
behalf. The Rights Plan also gives the board of directors
greater control over the timing of any acquisition transaction.
In the event of any unsolicited proposal that the board
determines to be inadequate or unfair, such control over timing
could enable the board to seek alternatives to maximize the
value of our company for all stockholders.
Examples of takeover tactics that may harm stockholders include
creeping acquisitions of our companys stock in
the open market, hostile tender offers made at less than a fair
price, and partial and two-tiered tender offers that may
discriminate against late-tendering shareholders. The Rights
Plan gives our board of directors a powerful tool to discourage
such tactics. It is not intended to prevent, and will not
prevent, any takeover proposal that our board of directors
determines to be in the best interests of our company and our
stockholders.
There is evidence that the stockholders of takeover targets
benefit from shareholders rights plans, such as the Rights Plan.
Based on a study of 526 unsolicited takeover attempts from 1985
through 1998, professors Randall Heron and Erik Lie found that
poison pills do not reduce the likelihood of a takeover
and are associated with both higher takeover premiums and higher
stockholder gains. Heron and Lie, On the Use of
Poison Pills and Defensive Payouts by Takeover
Targets, Journal of Business, vol. 79,
no. 4, p. 1783 at 1785 (The University of Chicago,
copyright 2006). Over 1,000 U.S. public companies
maintained a shareholders rights plan at 2009 year-end,
according to FactSet Research Systems Inc.
Our board believes that the protections afforded by the Rights
Plan are particularly valuable to our company because of our
significant cash position, which could enable a hostile bidder
to bootstrap a bid for our company, in effect using
our companys own cash to finance the bulk of the
acquisition price.
In recommending a vote against the Stockholder Proposal,
our board of directors is not suggesting that it will, without
question, retain the Rights Plan until its scheduled expiration
in 2018. Any determination to retain, amend or revoke the Plan
will be made after careful deliberation, conducted in light of
such reliable data and information as the board determines at
such time, and in accordance with the boards continuing
fiduciary responsibilities to our company and its stockholders.
However, the board believes that terminating the Rights Plan at
this time would take away an essential tool to protect
stockholders and would be contrary to the best interests of our
company and our stockholders.
Vote and
Recommendation
Approval of the stockholder proposal requires the affirmative
vote of a majority of the voting power of the shares of our
common stock outstanding on the record date that are present, in
person or by proxy, voting together as a single class, at the
annual meeting.
Our board of directors unanimously recommends a vote AGAINST
the stockholder proposal.
14
MANAGEMENT
Executive
Officers
The following lists the executive officers of our company (other
than William R. Fitzgerald, our Chairman of the Board and Chief
Executive Officer, and Jose A. Royo, our late President and
Chief Operating Officer, whose backgrounds are described under
Proposal 1 The Election of Director
Proposal), their ages and a description of their business
experience, including positions held with our company.
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Name
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Positions
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William E. Niles
Age: 46
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Mr. Niles has served as Executive Vice President and General
Counsel of AMG since January 2002, and, since the spin-off
of our company from DHC in September 2008, has also served as
Executive Vice President and General Counsel of our company.
From August 2006 through February 2008, Mr. Niles was a member
of AMGs executive committee. Prior to 2002, Mr. Niles was
a senior executive handling legal and business affairs within
AMG and its predecessor companies.
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John A. Orr
Age: 47
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Mr. Orr has served as Senior Vice President, Corporate
Development, of our company since September 2008. Mr. Orr
worked with Liberty Media from August 1996 until December 2008,
spearheading numerous acquisition opportunities and serving most
recently as Vice President of Investor Relations from 2003 until
December 2008.
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George C. Platisa
Age: 53
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Mr. Platisa has served as Executive Vice President and Chief
Financial Officer of AMG since May 2001, and, since the spin-off
of our company from DHC in September 2008, has also served as
Executive Vice President and Chief Financial Officer of our
company. From August 2006 through February 2008, Mr. Platisa was
a member of AMGs executive committee.
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Our executive officers will serve in such capacities until the
next annual meeting of our board of directors, or until their
respective successors have been duly elected or appointed, or
until their earlier death, resignation or removal from office.
There is no family relationship between any of our executive
officers or directors, by blood, marriage or adoption.
During the past ten years, none of our directors or executive
officers has had any involvement in any legal proceedings that
would be material to an evaluation of his ability or integrity.
Section 16(a)
Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our executive
officers and directors, and persons who own more than ten
percent of a registered class of our equity securities, to file
reports of ownership and changes in ownership with the SEC.
Officers, directors and greater than ten-percent stockholders
are required by SEC regulation to furnish us with copies of all
Section 16 forms they file.
Based solely on a review of the copies of the Forms 3, 4
and 5 and amendments to those forms furnished to us during our
most recent fiscal year, or written representations that no
Forms 5 were required, we believe that, during the year
ended December 31, 2009, all Section 16(a) filing
requirements applicable to our officers, directors and greater
than ten-percent beneficial owners were met.
15
Director
Independence
It is our policy that a majority of the members of our board of
directors be independent of our management. For a director to be
deemed independent, our board of directors must affirmatively
determine that the director has no disqualifying direct or
indirect material relationship with our company. To assist our
board of directors in determining which of our directors qualify
as independent for purposes of The Nasdaq Stock Market rules as
well as applicable rules and regulations adopted by the SEC, the
nominating and corporate governance committee of our board
follows the Corporate Governance Rules of The Nasdaq Stock
Market on the criteria for director independence.
Our board of directors has determined that each of Philip J.
Holthouse, Brian C. Mulligan, Michael J. Pohl and Carl E. Vogel
qualifies as an independent director of our company.
Board
Composition
As described above under Proposal 1 The
Election of Director Proposal, our board is comprised of
directors with a broad range of backgrounds and skill sets,
including media and telecommunications, auditing and tax. For
more information on our boards position with respect to
the importance of diverse viewpoints on our board, see
Committees of the Board of
Directors Nominating and Corporate Governance
Committee below.
Board
Leadership Structure
Our By-laws currently provide that the Chairman of the Board
shall be the Chief Executive Officer of our company, unless our
board of directors determines otherwise. William R. Fitzgerald,
who has served as the Chairman of our principal operating
subsidiary, AMG, since 2000, currently serves as our Chairman of
the Board and Chief Executive Officer (principal executive
officer) and is responsible for identifying and implementing
strategic initiatives. Prior to the passing of Jose A. Royo, who
served as our President and the chief executive officer of AMG,
Mr. Royo was responsible for the day to day operations of
AMG, served as a director of our company and contributed to
board discussions along with Mr. Fitzgerald and the other
directors. Although Mr. Fitzgerald served the dual roles of
Chairman of the Board and Chief Executive Officer of our
company, our board believed that the allocation of
responsibilities between Mr. Fitzgerald and Mr. Royo
represented the best leadership structure for our company at the
time because, among other reasons, it enabled
Mr. Fitzgerald to foster clear accountability and effective
decision making at the board level, while Mr. Royo focused
on the daily management of our operating company.
With Mr. Royos passing on May 18, 2010, the
board has designated Mr. Fitzgerald to serve as interim
chief executive officer of AMG, due to Mr. Fitzgerald
long-terms relationship with AMG and his in-depth
understanding of its business. The board does not believe that
Mr. Fitzgeralds service as interim chief executive
officer of AMG will negatively impact Mr. Fitzgeralds
ability to effectively lead our board in his role as Chairman.
Rather, our board believes that Mr. Fitzgerald remains the
director best situated to serve as Chairman of the Board because
he is the director most familiar with our companys
business and industry and is also the person most capable of
effectively indentifying strategic priorities and leading the
discussion and execution of strategy.
In addition, the key members of all committees of the board are
independent directors. Each member of the compensation
committee, nominating and corporate governance committee and
audit committee is independent. Further, an independent
director, Carl E. Vogel, is the chairman of the executive
committee of our board of directors. Through these committees,
we have established independent processes for the effective
oversight of critical issues entrusted to independent directors,
such as the integrity of our financial statements, CEO and
senior management compensation, board evaluation and selection
of directors. For more information on the function of our board
committees, see Committees of the Board of
Directors below.
For the above reasons, our board does not believe that a
separation of the Chairman of the Board and Chief Executive
Officer positions will provide any meaningful additional
oversight. Moreover, our board believes its current leadership
structure positions our company to achieve the optimal result
for its stockholders. At the present time, our board firmly
believes that combining the offices contributes to a more
efficient and effective board. Because Mr. Fitzgerald bears
primary responsibility for the strategic management and
leadership of our company,
16
our board believes that Mr. Fitzgerald is best suited to
chair board meetings and ensure that key business issues and
stockholders interests are brought to the attention of our
board.
Board
Role in Risk Oversight
Our board of directors has an active role, as a whole and at the
committee level, in overseeing the management of our
companys risks. Our board regularly reviews information
regarding our credit, liquidity, operations, strategic,
operational, financial and reporting, succession and
compensation, legal and compliance, and other risks, as well as
the risks associated with each. The compensation committee is
responsible for overseeing the management of risks relating to
our incentive compensation plans and arrangements. The audit
committee oversees management of financial risks. The nominating
and corporate governance committee manages risks associated with
the independence of the board and, together with the audit
committee, potential conflicts of interest. While each committee
is responsible for evaluating certain risks and overseeing the
management of such risks, the entire board is regularly informed
through committee reports and management presentations to the
full board about such risks.
Committees
of the Board of Directors
Executive
Committee
Our board of directors has established an executive committee,
whose chairman is Carl E. Vogel and whose other members are
William R. Fitzgerald and, prior to his passing, Jose A. Royo.
The principal purpose of the executive committee is to assist
our board of directors in the performance of its duties and
responsibilities between regularly scheduled meetings of the
board and at any time when the board is not in session or
otherwise unable to act, by exercising the power and authority
of the board to manage the business and affairs of our company
with respect to (i) such matters as shall be delegated to
the executive committee by resolution of the board and
(ii) any other lawful matters to the extent the executive
committee, in its discretion, determines that it is necessary or
advisable to attend to such matters prior to the next regularly
scheduled meeting of the board. As such, the executive committee
generally has and may exercise all the powers and authority of
our board in the management of the business and affairs of our
company, including without limitation the power and authority to
authorize the issuance of shares of our capital stock. However,
the executive committee shall have no power or authority in
reference to the following matters:
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approving, adopting or recommending to the stockholders of our
company any action or matter expressly required by the Delaware
General Corporation Law to be submitted to stockholders for
approval;
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adopting, amending or repealing any bylaws of our company;
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fixing the size of our board of directors or filling any
vacancies on our board or on any committee of our board; or
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the matters or powers expressly conferred upon the audit
committee, the compensation committee, and the nominating and
corporate governance committee.
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Compensation
Committee
Our board of directors has also established a compensation
committee, whose chairman is Michael J. Pohl and whose other
members are Philip J. Holthouse and Brian C. Mulligan. The
compensation committee reviews and makes recommendations to our
board regarding all forms of compensation provided to our
executive officers and directors. In addition, the compensation
committee reviews and makes recommendations on bonus and stock
compensation arrangements for all of our employees and has sole
responsibility for the administration of our incentive plans.
The compensation committee reviews and approves corporate goals
and objectives relevant to the compensation of our chief
executive officer and our other executive officers. The
compensation committee also reviews and approves the
compensation of our chief executive officer and certain other
officers of our company. For a description of our processes and
policies for consideration and determination of executive and
director compensation, including the role of our Chief Executive
Officer and outside consultants in determining or recommending
amounts
and/or forms
of compensation, see Executive Compensation
Compensation Discussion and Analysis below.
17
The compensation committee has the authority to retain a
compensation consultant to assist in the evaluation of executive
compensation. In 2009, the compensation committee engaged
Craford Benefit Consulting (which we refer to as Craford)
to assist the compensation committee and our human resources
department with the compilation and analysis of historical
compensation information and market and proxy data on our peer
companies as they relate to compensation of our named executive
officers (as defined below) and our incentive programs. In
addition, Craford provided analysis on the LTIP (as defined
below) and MIP (as defined below), collected information on
market data and market survey information and reviewed the roles
of certain of our executives to better align the
responsibilities attributed to an executive with such
executives level within our company. Also in 2009, Craford
assisted our company in the implementation of a performance
management software system.
Our board of directors has adopted a written charter for the
compensation committee, which is available on our website at
www.ascentmediacorporation.com/Compensation-Committee-Charter.aspx.
Compensation
Committee Interlocks and Insider Participation
In 2009, the compensation committee of our board of directors
consisted of Michael J. Pohl, Philip J. Holthouse and Brian C.
Mulligan. No member of the compensation committee is or has been
an officer or employee of our company, or has engaged in any
related party transaction in which our company was a participant.
Nominating
and Corporate Governance Committee
Our board of directors has established a nominating and
corporate governance committee, whose chairman is Brian C.
Mulligan and whose other members are Philip J. Holthouse and
Michael J. Pohl. See Director
Independence above.
The nominating and corporate governance committee:
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develops qualification criteria for selecting candidates to
serve as directors of our company;
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identifies individuals qualified to become directors of our
company and makes recommendations to our board with respect
thereto;
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reviews and approves related person transactions (as
set forth in our corporate governance guidelines); and
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reviews, and makes recommendations with respect to changes to,
our corporate governance guidelines.
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The nominating and corporate governance committee will consider
candidates for director recommended by any stockholder provided
that such nominations are properly submitted. Eligible
stockholders wishing to recommend a candidate for nomination as
a director should send the recommendation in writing to the
Nominating and Corporate Governance Committee, Ascent Media
Corporation, 12300 Liberty Boulevard, Englewood, Colorado 80112.
Stockholder recommendations must be made in accordance with our
bylaws, as discussed under Stockholder Proposals
below, and must contain the following information:
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the proposing stockholders name and address and
documentation indicating the number of shares of our common
stock beneficially owned by such person and the holder or
holders of record of those shares, together with a statement
that the proposing stockholder is recommending a candidate for
nomination as a director;
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the candidates name, age, business and residence
addresses, principal occupation or employment, business
experience, educational background and any other information
relevant in light of the factors considered by the nominating
and corporate governance committee in making a determination of
a candidates qualifications, as described below;
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a statement detailing any relationship, arrangement or
understanding that might affect the independence of the
candidate as a member of our board of directors;
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any other information that would be required under SEC rules in
a proxy statement soliciting proxies for the election of such
candidate as a director;
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a representation as to whether the proposing stockholder intends
to deliver any proxy materials or otherwise solicit proxies in
support of the director nominee;
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a representation that the proposing stockholder intends to
appear in person or by proxy at the annual stockholders meeting
at which the person named in such notice is to stand for
election; and
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a signed consent of the candidate to serve as a director, if
nominated and elected.
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In connection with its evaluation, the nominating and corporate
governance committee may request additional information from the
proposing stockholder and the candidate. The nominating and
corporate governance committee has sole discretion to decide
which individuals to recommend for nomination as directors.
To be nominated to serve as a director, a nominee need not meet
any specific, minimum criteria; however, the nominating and
corporate governance committee believes that nominees for
director should possess the highest personal and professional
ethics, integrity, values and judgment and should be committed
to the long-term interests of our stockholders. When evaluating
a potential director nominee, including one recommended by a
stockholder, the nominating and corporate governance committee
will take into account a number of factors, including, but not
limited to, the following:
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independence from management;
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his or her unique background, including education, professional
experience and relevant skill sets;
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judgment, skill, integrity and reputation;
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industry experience;
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existing commitments to other businesses as a director,
executive or owner;
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personal conflicts of interest, if any; and
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the size and composition of the existing board of directors,
including whether the potential director nominee would
positively impact the composition of the board by bringing a new
perspective or viewpoint to our board of directors.
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The nominating and corporate governance committee does not have
a formal policy with respect to diversity; however, our board
and the nominating and corporate governance committee believe
that it is essential that the board members represent diverse
viewpoints.
When seeking candidates for director, the nominating and
corporate governance committee may solicit suggestions from
incumbent directors, management, stockholders and others. After
conducting an initial evaluation of a prospective nominee, the
nominating and corporate governance committee will interview
that candidate if it believes the candidate might be suitable to
be a director. The nominating and corporate governance committee
may also ask the candidate to meet with management. If the
nominating and corporate governance committee believes a
candidate would be a valuable addition to the board of
directors, it may recommend to the full board that
candidates nomination and election.
Prior to nominating an incumbent director for re-election at an
annual meeting of stockholders, the nominating and corporate
governance committee will consider the directors past
attendance at, and participation in, meetings of the board of
directors and its committees and the directors formal and
informal contributions to the various activities conducted by
the board and the board committees of which such individual is a
member.
The nominating and corporate governance committee (with
Mr. Holthouse and Mr. Mulligan abstaining and recusing
themselves from this discussion ) has determined that
Mr. Holthouse and Mr. Mulligan continue to be
qualified to serve as directors of the company and have
recommended to the board of directors that they be nominated for
re-election to serve as Class II directors for a three-year
term. The nominations of Mr. Holthouse and
Mr. Mulligan have been approved by the entire board of
directors.
Our board of directors has adopted a written charter for the
nominating and corporate governance committee and corporate
governance guidelines, which are available on our website at
www.ascentmediacorporation.com/
19
Nominating-Corporate-Governance-Committee-Charter.aspx
and
www.ascentmediacorporation.com/Corporate-Governance-Guidelines.aspx,
respectively.
Audit
Committee
Our board of directors has established an audit committee, whose
chairman is Philip J. Holthouse and whose other members are
Brian C. Mulligan, Michael J. Pohl and Carl E. Vogel. See
Director Independence above.
The audit committee reviews and monitors the corporate financial
reporting and the internal and external audits of our company.
The committees functions include, among other things:
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appointing or replacing our independent auditors;
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reviewing and approving in advance the scope and the fees of our
annual audit and reviewing the results of our audits with our
independent auditors;
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reviewing and approving in advance the scope and the fees of
non-audit services of our independent auditors;
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reviewing compliance with and the adequacy of our existing major
accounting and financial reporting policies;
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reviewing our managements procedures and policies relating
to the adequacy of our internal accounting controls and
compliance with applicable laws relating to accounting practices;
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reviewing compliance with applicable SEC and stock exchange
rules regarding audit committees; and
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preparing a report for our annual proxy statement.
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Our board of directors has adopted a written charter for the
audit committee, which is available on our website at
www.ascentmediacorporation.com/Audit-Committee-Charter.aspx.
Audit
Committee Report
Each member of the audit committee is an independent director as
determined by our board of directors, based on the listing
standards of The Nasdaq Stock Market. Each member of the audit
committee also satisfies the SECs independence
requirements for members of audit committees. Each of
Mr. Holthouse, Mr. Mulligan and Mr. Vogel is an
audit committee financial expert under applicable
SEC rules and regulations.
The audit committee reviews our financial reporting process on
behalf of our board of directors. Management has primary
responsibility for establishing and maintaining adequate
internal controls, for preparing financial statements and for
the public reporting process. Our independent auditor, KPMG LLP,
is responsible for expressing opinions on the conformity of our
audited consolidated financial statements with
U.S. generally accepted accounting principles. Our
independent auditor also expresses its opinion as to the
effectiveness of our internal control over financial reporting.
The audit committee has reviewed and discussed with management
and KPMG LLP our most recent audited consolidated financial
statements, as well as managements assessment of the
effectiveness of our internal control over financial reporting
and KPMG LLPs evaluation of the effectiveness of our
internal control over financial reporting. The audit committee
has also discussed with KPMG LLP the matters required to be
discussed by the Statement on Auditing Standards No. 61
(Communications With Audit Committees), as amended, and as
adopted by the Public Accounting Oversight Board in
Rule 3200T, plus the additional matters required to be
discussed by the Statement on Auditing Standards No. 114
(The Auditors Communication with Those Charged with
Governance), as modified or supplemented, including that
firms judgment about the quality of our accounting
principles, as applied in its financial reporting.
KPMG LLP has provided the audit committee with the written
disclosures and the letter required by the Public Company
Accounting Oversight Board Ethics and Independence
Rule 3526, as modified or supplemented, and the audit
committee has discussed with KPMG LLP that firms
independence from the company and its subsidiaries.
20
Based on the reviews, discussions and other considerations
referred to above, the audit committee recommended to our board
of directors that the audited financial statements be included
in our Annual Report on
Form 10-K
for the year ended December 31, 2009, which was filed on
March 12, 2010 with the SEC and amended by Amendment
No. 1 on
Form 10-K/A,
which was filed on April 30, 2010 with the SEC.
Submitted by the Members of the Audit Committee
Philip J. Holthouse
Brian C. Mulligan
Michael J. Pohl
Carl E. Vogel
Other
Our board of directors, by resolution, may from time to time
establish other committees of our board of directors, consisting
of one or more of our directors. Any committee so established
will have the powers delegated to it by resolution of our board
of directors, subject to applicable law.
Board
Meetings
During 2009, there were 13 meetings of our full board of
directors, 4 meetings of our compensation committee, 6 meetings
of our nominating and corporate governance committee, 11
meetings of our audit committee and no meetings of our executive
committee.
Director
Attendance at Annual Meetings
Our board of directors encourages all members of the board to
attend each annual meeting of our stockholders. All but two of
our board members then serving attended our 2009 annual meeting
of stockholders.
Stockholder
Communication with Directors
Our stockholders may send communications to our board of
directors or to an individual director, in each case,
c/o Ascent
Media Corporation, 12300 Liberty Boulevard, Englewood, Colorado
80112. All such communications from stockholders will be
forwarded to our directors on a timely basis.
Executive
Sessions
In 2009, the independent directors of our company met at 3
executive sessions without management participation. Any
interested party who has a concern regarding any matter which it
wishes to have addressed by our independent directors, as a
group, at an upcoming executive session may send its concern in
writing addressed to Independent Directors of Ascent Media
Corporation,
c/o Ascent
Media Corporation, 12300 Liberty Boulevard, Englewood, Colorado
80112. The current independent directors of our company are
Philip J. Holthouse, Brian C. Mulligan, Michael J. Pohl and Carl
E. Vogel.
Risk
Assessment in Compensation Programs
Following the completion of a risk assessment of our
compensation programs applicable to all employees, we have
concluded that the design and operation of our compensation
programs do not provide our employees with incentive to engage
in business activities or other actions that would threaten the
value of our company or the investment of our stockholders. We
have also concluded that any risks associated with our
compensation programs are not reasonably likely to have a
material adverse effect on our company.
21
EXECUTIVE
COMPENSATION
This section sets forth information relating to, and an analysis
and discussion of, compensation paid by our company to:
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William R. Fitzgerald;
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George C. Platisa;
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William E. Niles;
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John A. Orr; and
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Jose A. Royo.
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Mr. Fitzgerald is our principal executive officer;
Mr. Platisa is our principal financial officer; and
Messrs. Niles and Orr are executive officers of our
company. Prior to his passing on May 18, 2010, Jose A. Royo
was an executive officer of our company and president and chief
executive officer of AMG. Mr. Fitzgerald is currently
acting as president and chief executive officer of AMG on an
interim basis, in addition to his other duties. Currently our
company does not have any other executive officers. We refer to
Messrs. Fitzgerald, Platisa, Niles, Orr and Royo in this
proxy statement collectively as our named executive
officers.
Compensation
Discussion and Analysis
Overview
The compensation committee of our board of directors has
responsibility for overseeing the compensation of our named
executive officers and ensuring that their compensation packages
are consistent with the companys compensation objectives.
In furtherance of this purpose, our compensation committee
reviews and makes recommendations regarding all cash-based
components of the executive officers compensation packages
and approves periodic corporate goals and objectives upon which
compensation decisions are made. The compensation committee also
administers our equity incentive plans and has the authority to
make and modify grants under, and to approve or disapprove
participation in, such plans.
Objectives
The compensation program for our named executive officers was
designed to meet the following objectives that align with and
support our strategic business goals:
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attracting and retaining executive managers with the industry
knowledge, skills, experience and talent to help our company
attain its strategic objectives and build long-term company
value;
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emphasizing variable performance-based compensation components,
which include equity-based compensation, by linking individual
compensation with corporate operating metrics as well as
individual professional achievements;
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aligning the interests of management of our company with the
interests of our shareholders; and
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aligning the interests of management of AMG with the interests
of our shareholders.
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Principles
The following principles are used to guide the design of our
executive compensation program and to ensure that the program is
consistent with the objectives described above:
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Competitive Positioning. We believe that our
executive compensation program must provide compensation to our
named executive officers that is both reasonable in relation to,
and competitive with, the compensation paid to similarly
situated employees of companies in our industry and companies
with which we compete for talent. These companies include major
motion picture studios, broadcast and cable programmers,
numerous independent creative services providers, technology
suppliers and companies in
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22
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various industries that operate or manage data and
communications networks. See Setting Executive
Compensation below.
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Pay for Performance Philosophy. We
believe our compensation program should align the interests of
our named executive officers with the interests of our company
and our shareholders by strengthening the link between pay and
company and individual performance. Variable compensation,
including plan-based awards, may represent a significant portion
of the total compensation mix for our named executive officers.
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Role
of Chief Executive Officer in Compensation
Decisions
Our Chief Executive Officer provides recommendations to the
compensation committee with respect to all elements of
compensation proposed to be paid to the other named executive
officers in conjunction with his evaluation of their performance.
Setting
Executive Compensation
Consistent with the principles outlined above, the compensation
committee considers compensation data relating to other
companies in reviewing and approving the compensation packages
of our named executive officers. In 2008, the compensation
committee engaged an outside consultant to compile compensation
data for a select group of peer companies that operate in
various markets within the technology, media, communications and
entertainment industries, and include client-based,
business-to-business
service providers and operators of global data networks. This
peer group was comprised of the following 14 publicly traded
U.S. companies, with which our company shares various
business characteristics, and which we compete for talent:
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Activision Blizzard
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Akamai Technologies
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Crown Media Holdings
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DreamWorks Animation
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Hughes Communications
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Liberty Media Corporation
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Lions Gate Entertainment
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Navarre
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Palm
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RealNetworks
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Schawk
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Take-Two Interactive Software
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ValueClick
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VeriSign
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The compensation committee reviewed and analyzed this
comparative data and, coupled with the committee members
general business and industry knowledge and experience,
established compensation levels for our named executive officers
that the compensation committee believes to be both reasonable
and competitive. The compensation committee did not establish
any specific benchmarking targets in connection with its
comparative review.
Elements
of 2009 Executive Compensation
For 2009, the principal components of compensation for our named
executive officers were:
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base salary;
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bonus or non-equity incentive compensation;
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equity incentive compensation; and
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limited perquisites and personal benefits.
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A summary of each element of the compensation program for our
named executive officers is set forth below. We believe that
each element complements the others and that together they serve
to achieve our compensation objectives.
Base
Salary
We provide competitive base salaries to attract and retain
high-performing executive talent. We believe that a competitive
base salary is an important component of compensation as it
provides a degree of financial stability for executives. The
base salary level of each named executive officer is generally
determined based on the
23
responsibilities performed by such officer, his or her
experience, overall effectiveness and demonstrated leadership
ability, the performance expectations set for such officer, and
competitive market factors. Notwithstanding the compensation
committees favorable assessment of the named executive
officers performance, the compensation committee
determined not to make any changes to the base salaries of the
named executive officers for 2009 as part of our companys
overall cost containment initiatives.
Bonus
Also consistent with our companys cost containment
initiatives, none of our named executive officers, except for
Mr. Orr, received a cash bonus for services to our company
for the 2009 calendar year. The compensation committee
determined to grant Mr. Orr a cash bonus based on its
positive review of Mr. Orrs performance in 2009 and
an evaluation of market data. The compensation committee took
into account a number of qualitative factors in determining to
grant Mr. Orr a bonus for 2009, without giving a specific
weight to any single factor. In addition, based on the
compensation committees review of market data for
comparable executives, the compensation committee determined
that Mr. Orrs total cash compensation for 2009 was
significantly below that of his peers and, accordingly, he
should be awarded a cash bonus for his 2009 performance. The
other named executive officers, who also received favorable
reviews for their 2009 performance, received an equity award
grant in lieu of a cash bonus. See Equity
Incentive Compensation below.
Non-Equity
Incentive Compensation
MIP. The compensation committee determined not
to grant any awards in 2009 under AMGs Management
Incentive Plan (which we refer to as the MIP). The MIP
has historically provided for annual cash incentive awards based
on company and individual performance. In response to the impact
of the global economic recession, AMG decided to suspend the MIP
for the 2009 calendar year as a cost saving measure.
LTIP. Each of Messrs. Niles, Platisa and
Royo have participated in AMGs 2006 Long-Term Incentive
Plan, as amended and restated as of September 9, 2008
(which we refer to as the LTIP). The LTIP provides for
the grant by AMG of awards which we refer to as phantom
appreciation rights or PARs to key employees of AMG.
Subject to vesting in accordance with the LTIP, each PAR
measures the increase, if any, in the Value (as defined below)
of a phantom unit under the LTIP from the grant date to the date
of exercise, in each case as defined in accordance with the
LTIP. The LTIP is administered by a committee, which has
authority to determine eligibility under the LTIP, to grant PARs
to eligible personnel thereunder, to interpret the LTIP for all
purposes, including the authority to make the calculations
required by the LTIP in accordance with the terms thereof, and
to make any adjustments provided for under the LTIP (including,
as discussed below, certain adjustments to PAR Values), subject,
in certain cases, to the approval of our compensation committee.
Pursuant to the LTIP, the Value of a phantom unit under
the LTIP as of any valuation date is equal to the sum of
(i) 6% of cumulative free cash flow (as defined in the
LTIP) over a period of up to six years, divided by 500,000 plus
(ii) the calculated value of AMG, based on a formula set
forth in the LTIP, divided by 10,000,000 (which we refer to as
the Company Value Component). A maximum of 500,000 PARs
may be granted under the LTIP. PARs that are exercised and paid,
and PARs that are forfeited or canceled or otherwise not paid,
are available for re-grant under the Plan. As of March 31,
2010, an aggregate of 337,000 PARs have been granted and are
outstanding under the LTIP.
Under the LTIP, cumulative free cash flow is defined as the
aggregate free cash flow, as of any valuation date, for all
calendar years beginning on or after January 1, 2006 and
ending on or before the applicable valuation date. Under the
LTIP, free cash flow is defined as, for any calendar year:
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the aggregate EBITDA of AMG;
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less the sum of the capital expenditures of AMG for such year;
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plus the aggregate cash amount actually expended by AMG for such
year for payment of taxes other than federal or state income
taxes;
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plus the portion of any debt service payments allocable to
interest on any outstanding debt of AMG for such year.
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24
The LTIP defines the value of AMG for the purpose of calculating
the Company Value Component as the sum of:
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7.5 times the aggregate EBITDA of AMG for the calendar year last
ended, excluding for this purpose EBITDA under certain long-term
networks services contracts; plus
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the present value of the free cash flow projected to be
generated over the life of such long-term networks services
contracts, using a 10% discount rate;
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minus the sum of any indebtedness of AMG, the liquidation value
of any preferred equity interests, and the aggregate amount of
AMGs obligations under the then outstanding vested PARs,
and any amounts that are or may become payable under certain
deferred compensation arrangements entered into by AMG or
subsidiaries of AMG; calculated in each case as provided under
the LTIP. Such value is calculated on a periodic basis pursuant
to the terms of the LTIP.
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In connection with a September 2008 amendment relating to our
sale of the AccentHealth business, (which we refer to as the
LTIP Amendment), AMG distributed to grantees who held
PARs at the date of the sale certain amounts (which we refer to
as AH Distributions) representing the increase in Value
of a phantom unit under the LTIP attributable to the increase in
the value of AccentHealth and the cumulative cash flow of
AccentHealth from adoption of the LTIP through the date of the
sale. The AH Distributions commenced in February 2009 and will
be made, with respect to Messrs. Niles, Platisa and Royo,
as follows:
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Name
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February 2009
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August 2009
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February 2010
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August 2010
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February 2011
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Total
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William E. Niles
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$
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418,000
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$
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83,600
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$
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501,600
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George C. Platisa
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$
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418,000
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$
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83,600
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$
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501,600
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Jose A. Royo
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$
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295,398
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$
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74,550
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$
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25,783
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$
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25,783
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$
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25,783
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$
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447,297
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Following the date of the LTIP Amendment, the Value of phantom
units under the LTIP no longer includes the value and free cash
flow of AccentHealth, and the grant date Value of outstanding
PARs was adjusted to reflect the exclusion, as described below.
As of December 31, 2009, (i) Messrs. Niles,
Platisa and Royo had received grants, made as of August 3,
2006, of 60,000 PARs, 60,000 PARs and 35,000 PARs, respectively
(which we refer to as the August 2006 Grants) and
(ii) Mr. Royo had received an additional grant, made
as of February 11, 2008, of 35,000 PARs (which we refer to
as the February 2008 Grant), in each case subject to
vesting as described below. The initial Value of the PARs
granted pursuant to the August 2006 Grants was $50.50 as of the
date of such grants, and was adjusted downward to $45.25
pursuant to the LTIP Amendment. The initial Value of the PARs
granted pursuant to the February 2008 Grant was $49.91 as of the
date of such grant, and was adjusted downward to $40.72 pursuant
to the LTIP Amendment. There were no grants under the LTIP in
2009.
The amount, if any, by which the Value of a phantom unit on the
exercise date of a PAR exceeds the grant date Value of a phantom
unit is referred to under the LTIP as the PAR Value
of such PAR. As of December 31, 2009, all PARs granted
prior to such date had a PAR Value of zero (if exercised on such
date) because the Value of each such PAR was less than the grant
date Value of such PAR.
Awards under the LTIP (including the right to receive any future
AH Distributions, as applicable) are subject to vesting. Unless
otherwise determined by the committee in connection with any
grant, and set forth in the applicable grant agreement, each
award under the LTIP will vest in 12 equal quarterly
installments over the
36-month
period following the Grant Date, so long as the grantee remains
continuously employed by our company on a full-time basis. A
grantee who dies or becomes disabled while employed will be 100%
vested in his or her PARs as of the date of death or disability.
Upon the termination of employment of a grantee, for any reason
other than a termination for Cause as defined in the LTIP, such
grantee will be deemed to exercise all of his or her vested PARs
on the grantees termination date, based on the PAR Value
as of the valuation date last preceding or on the date of
termination, and all unvested PARs will be terminated. All PARs,
whether vested or unvested, will automatically terminate
unexercised upon any termination of employment of the grantee
for Cause. All vested PARs then outstanding will be
automatically exercised upon a change of control (as defined in
the LTIP) or, if no change of control has then occurred, on
25
March 31, 2012, which is referred to under the LTIP as the
Payment Date. Pursuant to the LTIP, PARs may not be
exercised in any other manner except as described above.
Following the exercise of vested PARs, if the PAR Value of such
vested PARs is greater than zero, the grantee shall be entitled
to receive consideration in the amount of such PAR Value,
including interest (in the event of an exercise upon a change of
control) from the date of exercise to the date of payment at the
rate of three month LIBOR as published in the Wall Street
Journal. Such consideration shall be payable at the earlier of
the Payment Date and six months after the grantees
separation from service (as defined in the LTIP). Any such
consideration and all AH Distributions shall be payable in cash
or, at the discretion of the committee, in shares of any
publicly-traded class or series of common stock of AMG (if AMG
is at such time a publicly-traded corporation) or of any
corporate affiliate of AMG designated by the committee.
Under the LTIP, we have a right to require Messrs. Niles,
Platisa and Royo to repay or return to our company any cash or
shares paid to him under the LTIP, in the event of a material
restatement of our financial statements resulting from their
material noncompliance with any financial reporting requirement
under applicable securities laws, provided that such material
noncompliance resulted from misconduct on the part of the
applicable executive.
Equity
Incentive Compensation
Consistent with our compensation philosophy, we seek to align
the interests of our named executive officers with those of
stockholders by awarding equity-based incentive compensation,
ensuring that our executives have a continuing stake in the
long-term success of our company and our subsidiaries.
The Ascent Media Corporation 2008 Incentive Plan (which we refer
to as the incentive plan) provides for the grant of a
variety of incentive awards, including non-qualified stock
options, stock appreciation rights (which we refer to as
SARs), restricted shares, stock units, cash awards and
performance awards and is administered by our compensation
committee. On January 16, 2009, under the incentive plan,
each of Messrs. Niles and Platisa received a grant of
options to purchase 27,640 shares of our Series A
common stock and Mr. Royo received a grant of options to
purchase 41,460 shares of our Series A common stock at
an exercise price of $25.09 (which was the closing market price
on the grant date). Those options vest quarterly over a
four-year period and have a term of ten years, subject to
certain specified early termination events.
Messrs. Fitzgerald and Orr did not participate in this
grant because they had already received equity awards at the end
of 2008.
In addition, on March 1, 2010 the compensation committee
granted each of Messrs. Fitzgerald, Royo, Platisa and Niles
an award of restricted shares to reward them for their 2009
performance. The restricted shares vest in four equal quarterly
installments with the first such installment having vested on
March 17, 2010. These restricted shares were granted in
lieu of cash bonuses to better align the interests of such
executive officers with our stockholders and were based on the
compensation committees favorable review of each of their
performance in 2009. The compensation committee took into
account a number of qualitative factors in determining to reward
these named executive officers for their 2009 performance,
without giving a specific weight to any single factor.
Mr. Orr did not participate in this grant because he had
received a grant in 2008 consisting of both options and
restricted shares, and the compensation committee determined
that his existing equity compensation is a significant enough
portion of his total compensation to ensure that his interests
are aligned with those of our stockholders. Rather, Mr. Orr
received a cash bonus for his services in 2009 as described
under Bonus above.
Pursuant to the incentive plan, if a grantees employment
terminates by reason of death of disability, any equity awards
then held by such grantee shall immediately vest in full, unless
the applicable award agreement provides otherwise.
Perquisites
and Personal Benefits
In the year ended December 31, 2009, the limited
perquisites and personal benefits provided to our named
executive officers consisted generally of term life insurance
premiums and 401(k) matching contributions. We also offered our
named executive officers other benefits that are available on
the same basis to all of our salaried employees, such as medical
and disability insurance premiums.
26
Relocation
Assistance and Related Tax
Gross-Up
Consistent with our objective to attract and retain a
high-performing executive management team, we may recruit
candidates from throughout the U.S. to fill executive level
openings and will reimburse the newly hired executive for
relocation costs. To the extent such reimbursement is taxable to
the recipient, we may also provide a cash payment to the
recipient to offset the tax payable on such reimbursement, in
whole or in part, taking into account the tax payable by the
recipient on such tax
gross-up as
well.
Changes
to Compensation Programs for 2010
The compensation committee has reviewed the compensation to be
paid to Mr. Orr for the 2010 calendar year in light of his
experience and responsibilities as an officer of our company and
has determined to increase Mr. Orrs annual base
salary to better align his base salary with those of his market
peers. The base salaries of the other named executive officers
for 2010 will remain the same as part of our companys cost
containment initiatives. In February 2010, AMG determined not to
implement the MIP for the 2010 plan year. To date, there have
been no grants under the LTIP in 2010; however, the compensation
committee reserves the right to make grants under the LTIP at
any time or from time to time. We expect that any cash bonus
paid to our executive officers for their 2010 performance will
be determined in the discretion of the compensation committee.
Summary
Compensation Table
The following table sets forth information regarding the
compensation paid to our named executive officers during the
years ended December 31, 2009, 2008 and 2007 for services
to our company and its subsidiaries. Such compensation includes
amounts paid:
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following the date of our spin-off, by us directly;
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following the date of our spin-off, to Mr. Fitzgerald and
Mr. Orr by Liberty Media for which we reimbursed Liberty
Media pursuant to the terms of the Services Agreement, dated as
of July 21, 2005 (which we refer to as the services
agreement), between DHC and Liberty Media, which was
assigned by DHC to our company in connection with the spin-off;
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prior to the date of the spin-off, to Mr. Fitzgerald by
Liberty Media, to the extent allocated to services provided by
Mr. Fitzgerald to DHC and its subsidiaries, including AMG,
under the services agreement; and
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to Messrs. Niles, Platisa and Royo, by AMG.
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27
Summary
Compensation Table
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Non-Equity
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Incentive
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Name and
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Stock
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Option
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Plan
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All Other
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Principal Position
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Year
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Salary
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Bonus
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Awards(1)(2)
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Awards(1)
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Compensation(3)
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Compensation
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Total
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William R. Fitzgerald
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2009
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$
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426,248
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(4)
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$
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5,384
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(5)(9)
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$
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431,632
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Chairman and Chief
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2008
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$
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415,188
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(6)
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$
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59,108
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$
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1,999,999
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$
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3,789,884
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$
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30,707
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$
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6,294,886
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Executive Officer
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2007
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$
|
332,500
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(6)
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$
|
49,875
|
|
|
$
|
382,375
|
|
William E. Niles
|
|
|
2009
|
|
|
$
|
509,845
|
|
|
|
|
|
|
|
|
|
|
$
|
336,655
|
|
|
|
|
|
|
$
|
8,770
|
(9)
|
|
$
|
855,270
|
|
Executive Vice
|
|
|
2008
|
|
|
$
|
488,842
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
687,663
|
(7)(8)
|
|
$
|
8,501
|
(9)
|
|
$
|
1,185,006
|
|
President, General
|
|
|
2007
|
|
|
$
|
440,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
143,320
|
(7)
|
|
$
|
7,948
|
(9)
|
|
$
|
591,268
|
|
Counsel and Secretary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John A. Orr
|
|
|
2009
|
|
|
$
|
321,250
|
|
|
$
|
125,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,826
|
(9)
|
|
$
|
448,076
|
|
Senior Vice President
|
|
|
2008
|
|
|
$
|
83,389
|
(6)
|
|
$
|
54,844
|
|
|
$
|
799,993
|
|
|
$
|
1,432,356
|
|
|
|
|
|
|
$
|
11,119
|
(6)
|
|
$
|
2,381,701
|
|
|
|
|
2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
George C. Platisa
|
|
|
2009
|
|
|
$
|
509,845
|
|
|
|
|
|
|
|
|
|
|
$
|
336,655
|
|
|
|
|
|
|
$
|
10,320
|
(9)
|
|
$
|
856,820
|
|
Executive Vice
|
|
|
2008
|
|
|
$
|
490,323
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
680,872
|
(7)(8)
|
|
$
|
9,951
|
(9)
|
|
$
|
1,181,146
|
|
President and Chief
|
|
|
2007
|
|
|
$
|
475,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
147,595
|
(7)
|
|
$
|
9,484
|
(9)
|
|
$
|
632,079
|
|
Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jose A. Royo(10)
|
|
|
2009
|
|
|
$
|
623,077
|
|
|
|
|
|
|
|
|
|
|
$
|
504,983
|
|
|
|
|
|
|
$
|
8,886
|
(9)
|
|
$
|
1,136,946
|
|
President and Chief
|
|
|
2008
|
|
|
$
|
563,846
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
661,908
|
(7)(8)
|
|
$
|
1,377
|
(9)
|
|
$
|
1,227,131
|
|
Operating Officer
|
|
|
2007
|
|
|
$
|
337,731
|
(11)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
77,006
|
(7)
|
|
$
|
372
|
(9)
|
|
$
|
415,109
|
|
|
|
|
(1)
|
|
The aggregate grant date fair value
of stock awards and option awards has been computed in
accordance with FASB ASC Topic 718, but (pursuant to SEC
regulations) without reduction for estimated forfeitures. For a
description of the assumptions applied in these calculations,
see Note 12 to our consolidated financial statements for
the year ended December 31, 2009 (which are included in our
Annual Report on
Form 10-K
as filed with the SEC on March 12, 2010).
|
|
(2)
|
|
Does not include restricted stock
awards granted in March 2010 for services rendered in 2009. See
Compensation Discussion and
Analysis Elements of 2009 Executive
Compensation Equity Incentive Compensation
above.
|
|
(3)
|
|
Amounts granted pursuant to the
LTIP (which include PARs and the AH Distributions) represent
non-equity incentive compensation. Because the Value of each PAR
granted to our named executive officers does not exceed the
initial Value of such PARs, as of December 31, 2009, the
PAR Value of each such PAR, as of December 31, 2009, is
zero. Accordingly, no amounts are recorded in the Summary
Compensation Table reflecting the value of any outstanding PARs
held by our named executive officers. The full amounts of the AH
Distributions (including future payments) are recorded in the
Summary Compensation Table. See footnote (7) below.
|
|
(4)
|
|
Includes amounts for
Mr. Fitzgeralds salary for January 2009 paid to
Liberty Media pursuant to the services agreement.
|
|
(5)
|
|
Includes amounts paid to
Mr. Fitzgerald for tax preparation fees.
|
|
(6)
|
|
Includes amounts paid by our
company and/or DHC, as applicable, to Liberty Media pursuant to
the services agreement for portions of the applicable
officers salary and benefits.
|
28
|
|
|
(7)
|
|
Includes, as applicable, the
following amounts paid pursuant to the MIP:
|
|
|
|
|
|
|
|
|
|
|
|
Amounts ($)
|
Name
|
|
2008
|
|
2007
|
|
William E. Niles
|
|
|
186,063
|
|
|
|
143,320
|
|
George C. Platisa
|
|
|
179,272
|
|
|
|
147,595
|
|
Jose A. Royo
|
|
|
214,611
|
|
|
|
77,006
|
|
|
|
|
(8)
|
|
Includes, as applicable, the
following amounts paid, and to be paid, as AH Distributions:
|
|
|
|
|
|
Name
|
|
Amounts ($)
|
|
William E. Niles
|
|
|
501,600
|
|
George C. Platisa
|
|
|
501,600
|
|
Jose A. Royo
|
|
|
447,297
|
|
|
|
|
(9)
|
|
Includes the following matching
contributions to the applicable named executive officers
401(k) account:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts ($)
|
Name
|
|
2009
|
|
2008
|
|
2007
|
|
William E. Niles
|
|
|
8,250
|
|
|
|
7,750
|
|
|
|
7,500
|
|
George C. Platisa
|
|
|
9,800
|
|
|
|
9,200
|
|
|
|
9,000
|
|
John A. Orr
|
|
|
1,498
|
|
|
|
|
|
|
|
|
|
Jose A. Royo
|
|
|
8,250
|
|
|
|
|
|
|
|
|
|
Includes the following term life insurance premiums:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts ($)
|
Name
|
|
2009
|
|
2008
|
|
2007
|
|
William R. Fitzgerald
|
|
|
384
|
|
|
|
|
|
|
|
|
|
William E. Niles
|
|
|
520
|
|
|
|
751
|
|
|
|
448
|
|
John A. Orr
|
|
|
328
|
|
|
|
|
|
|
|
|
|
George C. Platisa
|
|
|
520
|
|
|
|
751
|
|
|
|
484
|
|
Jose A. Royo
|
|
|
636
|
|
|
|
1,377
|
|
|
|
372
|
|
|
|
|
(10)
|
|
Mr. Royo served as our
President, Chief Operating Officer and director until his
passing on May 18, 2010.
|
|
(11)
|
|
Includes $10,231 paid to
retroactively increase Mr. Royos salary for the year
ended December 31, 2006.
|
29
Employment
Agreements
Each of Messrs. Fitzgerald and Orr has entered into an
employment agreement with our company, and each of
Messrs. Platisa, Niles and Royo has entered an employment
agreement with AMG, which agreements in each case set forth the
respective terms and conditions of the applicable named
executive officers employment. The material terms of the
employment agreements of our named executive officers are set
forth below.
Term
The term of the employment agreements of each of
Messrs. Fitzgerald and Orr is five years, commencing
effective as of September 17, 2008 (the date of the
spin-off of our company from DHC) and ending on
September 16, 2013. The term of the employment agreements
of each of Messrs. Niles, Platisa and Royo is five years,
commencing on September 1, 2006 and ending on
August 31, 2011.
Base
Salary
Pursuant to their respective employment agreements, each of our
named executive officers receives a base salary that is subject
to an annual review for increase by the compensation committee.
The 2009 base salaries for each of our named executive officers
are set forth in the Summary Compensation Table
above.
Bonus
Each of Messrs. Fitzgerald and Orr is eligible to receive a
bonus in a certain range based on percentages of the applicable
named executive officers base salary (75% to 150% in the
case of Mr. Fitzgerald, and 50% to 75% in the case of
Mr. Orr). Each of Messrs. Fitzgeralds and
Orrs entitlement to receive such bonus, and the actual
amount thereof, is determined by the compensation committee in
its sole discretion based on the applicable named executive
officers achievement of certain performance criteria as
the compensation committee may establish in its sole discretion.
Equity
Incentive Awards
Each of the employment agreements of Messrs. Fitzgerald and
Orr memorialized stock option and restricted stock grants
previously made under the incentive plan to the applicable named
executive officer, as previously reported.
Mr. Fitzgeralds employment agreement provided for the
grant of the following equity awards: (i) options to
purchase 347,059 shares of our Series A common stock
at an exercise price of $21.81 and (ii) 91,701 restricted
shares of our Series A common stock. Mr. Orrs
employment agreement provided for the grant of the following
equity awards: (i) options to purchase 121,799 shares
of our Series A common stock at an exercise price of $23.16
and (ii) 34,542 restricted shares of our Series A
common stock. See Outstanding Equity Awards at
Fiscal Year-End below.
Non-Equity
Incentive Awards
The employment agreements of each of Messrs. Platisa, Niles
and Royo entitle the applicable named executive officer to
participate in the MIP and the LTIP or any similar plan. For a
description of the MIP and the LTIP, and amounts paid thereunder
with respect to the fiscal year ended December 31, 2009,
see Compensation Discussion and
Analysis Elements of 2009 Executive
Compensation Non-Equity Incentive Compensation
above.
Termination
The terms and conditions of compensation payable upon
termination of the employment of each named executive officer
are summarized in Potential Payments Upon
Termination or
Change-in-Control
below.
Gross-Up
Under Mr. Fitzgeralds employment agreement, if any
payment or distribution in the nature of compensation (as
defined in Section 280G(b)(2) of the Code) to or for the
benefit of Mr. Fitzgerald would be subject to excise tax
30
imposed by Section 4999 of the Code, Mr. Fitzgerald
will be entitled to receive a
gross-up
payment equivalent on an after-tax basis to the amount of such
excise tax.
Effect
on Prior Arrangements
From the date of the spin-off until the date of their respective
employment agreements, each of Messrs. Fitzgerald and Orr
provided services to our company under the services agreement.
Under the services agreement, Liberty Media agreed to make
available the services of certain Liberty Media personnel,
including Messrs. Fitzgerald and Orr, to our company and we
agreed to reimburse Liberty Media for that portion of such
personnels salary and benefits as allocated to such
personnels service to our company.
As a result of the execution of Mr. Fitzgeralds
employment agreement, beginning in February 2009, we pay
Mr. Fitzgeralds base salary directly and have no
reimbursement obligation to Liberty Media with respect thereto.
Mr. Fitzgeralds base salary for January 2009 was
payable by Liberty Media pursuant to the services agreement and
partially reimbursable by our company. Liberty Media ceased
providing compensation to Mr. Orr, and our reimbursement
obligation to Liberty Media respect thereto ceased, on
December 31, 2008. See Certain Relationships and
Related Transactions, and Director Independence
Transactions with Related Persons Services Agreement
with Liberty Media below.
Grants of
Plan-Based Awards
The following table contains information regarding plan-based
incentive awards granted during the year ended December 31,
2009.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Other Option
|
|
|
|
|
|
|
|
|
Awards: Number of
|
|
|
|
|
|
|
|
|
Securities
|
|
Exercise or Base
|
|
Grant Date Fair
|
|
|
|
|
Underlying Options
|
|
Price of Option
|
|
Value of Stock and
|
Name
|
|
Grant Date
|
|
(#)(1)
|
|
Awards ($)
|
|
Option Awards ($)
|
|
William R. Fitzgerald
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William E. Niles
|
|
|
1/16/2009
|
|
|
|
27,640
|
|
|
$
|
25.09
|
|
|
$
|
336,655
|
|
John A. Orr
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
George C. Platisa
|
|
|
1/16/2009
|
|
|
|
27,640
|
|
|
$
|
25.09
|
|
|
$
|
336,655
|
|
Jose A. Royo
|
|
|
1/16/2009
|
|
|
|
41,460
|
|
|
$
|
25.09
|
|
|
$
|
504,983
|
|
|
|
|
(1) |
|
Vests quarterly over 4 years from grant date. See
Compensation Discussion and
Analysis Elements of 2009 Executive
Compensation Equity Incentive Compensation
above. |
Outstanding
Equity Awards at Fiscal Year-End
The following table contains information regarding unexercised
options to acquire shares of our common stock, and unvested
restricted stock awards, which were outstanding as of
December 31, 2009 and held by any of
31
our named executive officers, including those awards granted
during 2009 and reflected in the Grants of Plan-Based
Awards table above.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
Market
|
|
|
Number of
|
|
Number of
|
|
|
|
|
|
Shares or
|
|
Value of
|
|
|
Securities
|
|
Securities
|
|
|
|
|
|
Units of
|
|
Shares
|
|
|
Underlying
|
|
Underlying
|
|
|
|
|
|
Stock That
|
|
or Units of
|
|
|
Unexercised
|
|
Unexercised
|
|
Option
|
|
Option
|
|
Have
|
|
Stock That
|
|
|
Options-
|
|
Options-
|
|
Exercise
|
|
Expiration
|
|
not
|
|
Have not
|
Name
|
|
Exercisable
|
|
Unexercisable
|
|
Price ($)
|
|
Date
|
|
Vested (#)
|
|
Vested ($)
|
|
William R. Fitzgerald
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
86,763
|
|
|
|
260,296
|
(1)
|
|
$
|
21.81
|
|
|
|
9/17/2018
|
|
|
|
|
|
|
|
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
63,045
|
(3)
|
|
$
|
1,609,539
|
|
William E. Niles
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
5,181
|
|
|
|
22,459
|
(2)
|
|
$
|
25.09
|
|
|
|
1/16/2019
|
|
|
|
|
|
|
|
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John A. Orr
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
30,448
|
|
|
|
91,351
|
(1)
|
|
$
|
23.16
|
|
|
|
9/17/2018
|
|
|
|
|
|
|
|
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23,748
|
(3)
|
|
$
|
606,286
|
|
George C. Platisa
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
5,181
|
|
|
|
22,459
|
(2)
|
|
$
|
25.09
|
|
|
|
1/16/2019
|
|
|
|
|
|
|
|
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jose A. Royo(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
7,773
|
|
|
|
33,687
|
(2)
|
|
$
|
25.09
|
|
|
|
1/16/2019
|
|
|
|
|
|
|
|
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Vests quarterly over five years from September 17, 2008. |
|
(2) |
|
Vests quarterly over four years from January 16, 2009. |
|
(3) |
|
Vests quarterly over four years from September 17, 2008. |
|
(4) |
|
All of Mr. Royos unvested equity awards immediately
vested upon his passing on May 18, 2010. |
Option
Exercises and Stock Vested
No options to purchase shares of our common stock were exercised
by our named executive officers during the year ended
December 31, 2009.
32
The following table sets forth information regarding the vesting
of restricted stock held by our named executive officers, in
each case, during the year ended December 31, 2009.
|
|
|
|
|
|
|
|
|
|
|
Stock Awards
|
|
|
Number of Shares
|
|
Value Realized on
|
|
|
Acquired on Vesting
|
|
Vesting
|
Name
|
|
(#)(1)
|
|
($)
|
|
William R. Fitzgerald
|
|
|
|
|
|
|
|
|
Series A
|
|
|
22,925
|
|
|
$
|
583,270
|
|
John A. Orr
|
|
|
|
|
|
|
|
|
Series A
|
|
|
8,635
|
|
|
$
|
219,697
|
|
|
|
|
(1) |
|
Includes shares withheld in payment of withholding taxes at
election of holder. |
Potential
Payments Upon Termination or
Change-in-Control
Each of the employment agreements of our named executive
officers provides for certain severance payments in the event of
the termination of the employment of the applicable named
executive officer, with adjustments to be made to such severance
payments if such named executive officers employment is
terminated concurrently with or following a change of control of
our company.
Change
of Control
Under each of the employment agreements of
Messrs. Fitzgerald and Orr, a change of control of our
company will be deemed to have occurred if any of the following
occurs:
(i) any person or group (other than Mr. Malone and
certain affiliates, each of whom we refer to as an Ascent
Permitted Holder) acquires, together with stock already held
by such person or group, more than 50% of the total fair market
value or more than 50% of the total voting power of the stock of
our company;
(ii) any person or group (other than an Ascent Permitted
Holder) acquires, in a single transaction or in multiple
transactions during a
12-month
period, assets of our company having a gross fair market value
of 40% or more of the total gross fair market value of all of
our companys assets immediately prior to such acquisition
or acquisitions;
(iii) any person or group (other than an Ascent Permitted
Holder) acquires, in a single transaction or in multiple
transactions during a
12-month
period, 30% or more of the total voting power of the stock of
our company; or
(iv) a majority of our companys board of directors is
replaced during any
12-month
period by directors whose appointment or election is not
endorsed by a majority of the board of directors before the date
of appointment or election.
Under each of the employment agreements of Messrs. Royo,
Niles and Platisa, a change of control of AMG will be deemed to
have occurred if any person or group (other than one or more of
a parent entity of AMG, Mr. Malone and certain affiliates
of each, each of whom we refer to as an AMG Permitted
Holder):
(i) acquires, directly or indirectly, all or substantially
all of the assets of AMG; or
(ii) becomes the beneficial owner of more than 50% of the
aggregate voting power of AMGs outstanding voting
securities, and such person or group beneficially owns a greater
percentage of such aggregate voting power than owned in the
aggregate by the AMG Permitted Holders, subject to certain
exceptions.
Termination
for Cause
If our company (in the case of Messrs. Fitzgerald and Orr)
or AMG (in the case of Messrs. Niles, Platisa and Royo)
terminates any named executive officers employment for
Cause, our company or AMG, as applicable, will have
no further liability or obligations under the applicable
agreement to such named executive officer other
33
than accrued but unpaid base salary, vacation days and expenses.
Cause is defined in each employment agreement to
include: breaches of material obligations under the applicable
employment agreement; continued failure to perform the
applicable named executive officers duties; material
violations of company policies or applicable laws and
regulations; fraud, dishonesty or misrepresentation; gross
negligence in the performance of duties; conviction of a felony
or crime of moral turpitude; and other misconduct that is
materially injurious to our financial condition or business
reputation.
Termination
Without Cause
If our company terminates the employment of Mr. Fitzgerald
or Mr. Orr without cause, our company becomes obligated to
pay the applicable named executive officer:
(i) accrued but unpaid base salary and vacation time;
(ii) a severance payment equal to:
|
|
|
|
|
if termination occurs prior to a change of control, as defined
in the employment agreement, the product of 2 (in the case of
Mr. Fitzgerald) or 1 (in the case of Mr. Orr) times
the sum of (A) the named executive officers base
salary (B) plus the named executive officers minimum
target bonus (equal to 75%, in the case of Mr. Fitzgerald,
or 50%, in the case of Mr. Orr, of the named executive
officers base salary); or
|
|
|
|
if termination occurs concurrently with or following such a
change of control, the product of 2.5 (in the case of
Mr. Fitzgerald) or 1.5 (in the case of Mr. Orr) times
the sum of (A) the named executive officers base
salary (B) plus the named executive officers minimum
target bonus (equal to 75%, in the case of Mr. Fitzgerald,
or 50%, in the case of Mr. Orr, of the named executive
officers base salary);
|
(iii) accrued but unpaid bonus for the calendar year prior
to the year in which the termination occurs; and
(iv) incurred but unpaid expenses.
If AMG terminates the employment of Mr. Royo,
Mr. Niles or Mr. Platisa without cause, AMG becomes
obligated to pay the applicable named executive officer:
(i) accrued but unpaid base salary and vacation time;
(ii) a severance payment equal to:
|
|
|
|
|
if termination occurs prior to a change of control, as defined
in the employment agreement, the named executive officers
base salary times 2.0; or
|
|
|
|
if termination occurs concurrently with or following such a
change of control, the product of 2.5 times the sum of
(A) the named executive officers base salary and
(B) an amount equal to the named executive officers
average bonus award under the MIP for the preceding two years
(or, if greater, 60% of the named executive officers
target award under the MIP for the year of termination), in each
case calculated as a percentage of base salary and applied to
the named executive officers then current base salary;
|
(iii) in lieu of any award payable under the MIP with
respect to the applicable year of termination:
|
|
|
|
|
if termination occurs prior to a change of control, as defined
in the employment agreement, and (i) on a date that is on
or prior to June 30 of the calendar year in which the
termination occurs, an amount equal to the product of the named
executive officers base salary for the year of termination
multiplied by the named executive officers average bonus
award under the MIP for the preceding two years, calculated as a
percentage of base salary and applied to the named executive
officers then current base salary (or, if greater, 60% of
the named executive officers target award under the MIP
for the year of termination), in each case calculated as a
percentage of base salary, or (ii) on a date that is after
June 30 of such calendar year, the greater of the amount
determined in item (i) above or an amount equal to the
named executive officers actual bonus award under the MIP
for the applicable year, in each case prorated to the date of
termination; or
|
34
|
|
|
|
|
if termination occurs concurrently with or following such change
of control, an amount equal to the named executive
officers average bonus award under the MIP for the
preceding two years (or, if greater, 60% of the named executive
officers target award under the MIP for the year of
termination), in each case calculated as a percentage of base
salary and applied to the named executive officers then
current base salary, prorated to the date of
termination; and
|
(iv) incurred but unpaid expenses.
Termination
with Good Reason
Subject to certain notice provisions and our companys
rights with respect to a cure period or AMGs rights with
respect to a renegotiation period, as applicable, each of our
named executive officers may terminate his employment for
Good Reason and receive the same payments as if such
named executive officers employment was terminated without
Cause. Good Reason is defined in each employment
agreement to include:
|
|
|
|
|
in the case of Mr. Fitzgerald, a material reduction in base
salary, a material reduction in Mr. Fitzgeralds
responsibilities with our company, a material change in the
office or location at which Mr. Fitzgerald is required to
perform services and a material breach by our company of any
provision in the Fitzgerald Employment Agreement;
|
|
|
|
in the case of Mr. Orr, a material reduction in base salary
and a material breach by our company of any provision of the Orr
Employment Agreement; and
|
|
|
|
in the case of Messrs. Niles, Platisa and Royo, a reduction
in base salary, a breach by AMG of any material term of the
applicable employment agreement, the relocation of the
applicable named executive officers principal place of
employment by more than 35 miles and the failure of the
parties to negotiate a new, mutually acceptable employment
agreement following a change of control.
|
Death
or Disability
In the event any of our named executive officers dies or becomes
disabled during such named executive officers term of
employment, our company or AMG, as applicable, becomes obligated
to pay such named executive officer (or his legal
representative, as applicable):
(i) any accrued but unpaid base salary and vacation time;
(ii) incurred but unpaid expenses;
(iii) in the case of Mr. Fitzgerald, a lump sum amount
equal to Mr. Fitzgeralds annual base salary in effect
on the date of termination multiplied by 2 (except if
Mr. Fitzgerald is covered by our companys basic life
insurance group benefit plan, in which case the lump sum will be
reduced to an amount equal to Mr. Fitzgeralds annual
base salary in effect on the date of termination);
(iv) in the case of Messrs. Niles or Platisa, a lump
sum amount equal to such named executive officers monthly
base salary in effect on the date of termination for the lesser
of six months or the remainder of the term of the applicable
employment agreement; and
(v) in the case of Mr. Royo an amount equal to the
present value of the payments of base salary Mr. Royo would
have received during the
24-month
period following such termination, calculated by applying a 6%
annual rate of interest without compounding. Mr. Royo
passed away on May 18, 2010.
Non-Renewal
Each of the employment agreements of Messrs. Fitzgerald,
Niles, Platisa and Royo provides that, absent a prior change of
control, if a new employment agreement is not executed to
continue the applicable named executive officers
employment beyond the term of the employment agreement, such
named executive officer will be deemed terminated without Cause
(except that if such named executive officer does not accept an
offered employment agreement on terms at least as favorable as
the employment agreement then in effect, such named executive
officer shall be entitled to 1.0 times base salary, rather than
2.0 times base salary, as a severance payment).
35
LTIP
For a description of the LTIP and the PARs granted thereunder,
see Compensation Discussion and
Analysis Elements of 2009 Executive
Compensation Non-Equity Incentive
Compensation LTIP above. In the event of a
change of control of AMG with respect to each PAR granted to a
grantee that remains an employee of AMG or one of its
subsidiaries on the date of such change of control:
|
|
|
|
|
the grantee will become 100% vested in such grantees PARs
as of the date of such change of control; and
|
|
|
|
the grantee will be deemed to have exercised such grantees
PARs as of the date of such change of control, with the
applicable PAR Value to be determined by the LTIP committee in
good faith based on the fair market value of the net proceeds
received in connection with the change of control.
|
Under the LTIP, a change in control will be deemed
to have occurred if there occurs a change in ownership of AMG or
a change in ownership in a substantial portion of AMGs
assets. A change in ownership is deemed to have occurred if any
person acquires ownership of the equity of AMG that constitutes
more than 50% of the total fair market value or more than 50% of
the total voting power of the equity of AMG. However, if any
person or group already owns more than 50% of the total fair
market value or more than 50% of the total voting power of AMG
equity at the time of such acquisition, the acquisition of
additional equity by the same person or group is not considered
to cause a change in ownership. A change in the ownership of a
substantial portion of AMGs assets is deemed to have
occurred if any person or group acquires 40% or more of the
total gross fair market value of AMGs assets. In either
case, there is no change in control when there is a transfer to
a person that is controlled by the shareholders of AMG
immediately after the transfer.
Incentive
Plan
Under certain conditions, including the occurrence of certain
approved transactions, a board change or a control purchase (all
as defined in the incentive plan), options and SARs will become
immediately exercisable, the restrictions on restricted shares
will lapse and stock units will become fully vested, unless
individual agreements state otherwise. At the time an award is
granted, the compensation committee will determine, and the
relevant agreement will provide for, any vesting or early
termination, upon a holders termination of employment with
our company, of any unvested options, SARs, stock units or
restricted shares, and the period following any such termination
during which any vested options, SARs and stock units must be
exercised. Unless otherwise provided in the relevant agreement,
(1) no option or SAR may be exercised after its scheduled
expiration date, (2) if the holders service
terminates by reason of death or disability (as defined in the
incentive plan), his or her options or SARs shall remain
exercisable for a period of at least one year following such
termination (but not later than the scheduled expiration date)
and (3) any termination of the holders service for
cause (as defined in the incentive plan) will result
in the immediate termination of all options, SARs and stock
units and the forfeiture of all rights to any restricted shares
retained distributions, unpaid dividend equivalents and related
cash amounts held by such terminated holder. If a holders
service terminates due to death or disability, options and SARs
will become immediately exercisable, the restrictions on
restricted shares will lapse and stock units will become fully
vested, unless individual agreements state otherwise.
Benefits
Payable Upon Termination or Change in Control
The following table sets forth benefits that would have been
payable to each named executive officer if the employment of
such named executive officer had been terminated on
December 31, 2009, assumes that all salary, bonus and
expense reimbursement amounts due on or before December 31,
2009 had been paid in full as of such date and, with the
exception of the remaining AH Distributions payable to
Mr. Royo, does not include any amounts payable pursuant to
the LTIP as the PAR Value of all PARs granted prior to
December 31, 2009 was zero on such
36
date. For more information regarding the number of PARs held by
our named executive officers see PARs
below.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Termination
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Termination
|
|
|
Without Cause or
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Without Cause or
|
|
|
for Good Reason
|
|
|
|
|
|
|
|
|
|
Voluntary
|
|
|
Termination
|
|
|
for Good Reason
|
|
|
(no Change in
|
|
|
|
|
|
|
|
Name
|
|
Termination
|
|
|
for Cause
|
|
|
(Change in Control)
|
|
|
Control)
|
|
|
Death
|
|
|
Disability
|
|
|
William R. Fitzgerald
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance
|
|
|
|
|
|
|
|
|
|
$
|
1,863,750
|
|
|
$
|
1,491,000
|
|
|
$
|
852,000
|
|
|
$
|
852,000
|
|
Bonus
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted Stock
|
|
|
|
|
|
|
|
|
|
$
|
1,609,539
|
|
|
|
|
|
|
$
|
1,609,539
|
|
|
$
|
1,609,539
|
|
Options
|
|
$
|
322,766
|
|
|
|
|
|
|
$
|
1,291,059
|
|
|
$
|
322,766
|
|
|
$
|
1,291,059
|
|
|
$
|
1,291,059
|
|
Total
|
|
$
|
322,766
|
|
|
|
|
|
|
$
|
4,764,348
|
|
|
$
|
1,813,766
|
|
|
$
|
3,752,598
|
|
|
$
|
3,752,598
|
|
William E. Niles
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance
|
|
|
|
|
|
|
|
|
|
$
|
1,661,421
|
|
|
$
|
982,000
|
|
|
$
|
245,500
|
|
|
$
|
245,500
|
|
Bonus
|
|
|
|
|
|
|
|
|
|
$
|
173,569
|
|
|
$
|
173,569
|
|
|
|
|
|
|
|
|
|
Restricted Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options
|
|
$
|
2,281
|
|
|
|
|
|
|
$
|
12,162
|
|
|
$
|
2,281
|
|
|
$
|
12,162
|
|
|
$
|
12,162
|
|
Total
|
|
$
|
2,281
|
|
|
|
|
|
|
$
|
1,847,152
|
|
|
$
|
1,157,850
|
|
|
$
|
257,662
|
|
|
$
|
257,662
|
|
John A. Orr
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance
|
|
|
|
|
|
|
|
|
|
$
|
731,250
|
|
|
$
|
487,500
|
|
|
|
|
|
|
|
|
|
Bonus
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted Stock
|
|
|
|
|
|
|
|
|
|
$
|
606,286
|
|
|
|
|
|
|
$
|
606,286
|
|
|
$
|
606,286
|
|
Options
|
|
$
|
72,167
|
|
|
|
|
|
|
$
|
288,664
|
|
|
$
|
72,167
|
|
|
$
|
288,664
|
|
|
$
|
288,664
|
|
Total
|
|
$
|
72,167
|
|
|
|
|
|
|
$
|
1,626,200
|
|
|
$
|
559,667
|
|
|
$
|
894,950
|
|
|
$
|
894,950
|
|
George C. Platisa
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance
|
|
|
|
|
|
|
|
|
|
$
|
1,643,009
|
|
|
$
|
982,000
|
|
|
$
|
245,500
|
|
|
$
|
245,500
|
|
Bonus
|
|
|
|
|
|
|
|
|
|
$
|
166,204
|
|
|
$
|
166,204
|
|
|
|
|
|
|
|
|
|
Restricted Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options
|
|
$
|
2,281
|
|
|
|
|
|
|
$
|
12,162
|
|
|
$
|
2,281
|
|
|
$
|
12,162
|
|
|
$
|
12,162
|
|
Total
|
|
$
|
2,281
|
|
|
|
|
|
|
$
|
1,821,375
|
|
|
$
|
1,150,485
|
|
|
$
|
257,662
|
|
|
$
|
257,662
|
|
Jose A. Royo(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Severance
|
|
|
|
|
|
|
|
|
|
$
|
1,956,750
|
|
|
$
|
1,200,000
|
|
|
$
|
1,133,784
|
|
|
$
|
1,133,784
|
|
Bonus
|
|
|
|
|
|
|
|
|
|
$
|
182,700
|
|
|
$
|
182,700
|
|
|
|
|
|
|
|
|
|
Restricted Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options
|
|
$
|
3,421
|
|
|
|
|
|
|
$
|
18,242
|
|
|
$
|
3,421
|
|
|
$
|
18,242
|
|
|
$
|
18,242
|
|
AH Distribution
|
|
|
|
|
|
|
|
|
|
$
|
51,566
|
|
|
|
|
|
|
$
|
51,566
|
|
|
$
|
51,566
|
|
Total
|
|
$
|
3,421
|
|
|
|
|
|
|
$
|
2,209,258
|
|
|
$
|
1,386,121
|
|
|
$
|
1,203,592
|
|
|
$
|
1,203,592
|
|
|
|
|
(1) |
|
Mr. Royo passed away on May 18, 2010. |
37
PARs. The following sets forth (i) the
number of PARs held by our named executive officers that had
vested as of December 31, 2009 and (ii) the number of
PARs held by our named executive officers that would have vested
as of December 31, 2009 assuming a change of control had
occurred prior to such date:
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of PARs Held
|
|
|
|
|
That Would Have Vested
|
|
|
Number of PARs Held
|
|
as of December 31,
|
|
|
That Had Vested as of
|
|
2009 Assuming a Change
|
Name
|
|
December 31, 2009
|
|
of Control
|
|
William R. Fitzgerald
|
|
|
|
|
|
|
|
|
William E. Niles
|
|
|
60,000
|
|
|
|
60,000
|
|
John A. Orr
|
|
|
|
|
|
|
|
|
George C. Platisa
|
|
|
60,000
|
|
|
|
60,000
|
|
Jose A. Royo
|
|
|
58,333
|
|
|
|
70,000
|
|
Compensation
of Directors
Our directors who are also employees of our company receive no
additional compensation for their services as directors. Each of
our non-employee directors receives compensation for services as
a director and, as applicable, for services as a member of any
board committee, as described below. All of our directors are
reimbursed for travel expenses relating to the attendance of our
board or committee meetings.
Director Fees. Each of our non-employee
directors is paid an annual retainer fee of $55,000, payable
quarterly in arrears effective as of September 17, 2009.
Director Plan. The Ascent Media Corporation
2008 Non-employee Director Incentive Plan (which we refer to as
the director plan) is administered by our entire board of
directors. Our board has full power and authority to grant
eligible persons the awards described below and to determine the
terms and conditions under which any awards are made. The
director plan is designed to provide our non-employee directors
with additional remuneration for services rendered, to encourage
their investment in our common stock (thereby increasing their
proprietary interest in our business and increasing their
personal interest in the continued success and progress of our
company) and to aid in attracting persons of exceptional ability
to become non-employee directors of our company. Our board may
grant non-qualified stock options, SARs, restricted shares,
stock units and cash awards or any combination of the foregoing
under the director plan (which we refer to, collectively, as
director awards).
The maximum number of shares of our common stock with respect to
which director awards may be issued under the director plan is
500,000, subject to anti-dilution and other adjustment
provisions of the director plan. Shares of our common stock
issuable pursuant to director awards are made available from
either authorized but unissued shares or shares that have been
issued but reacquired by us (including shares purchased in the
open market).
2009 Equity Grants. On December 23, 2009,
each of our non-employee directors received grants of restricted
shares of our Series A common stock with a grant date fair
value of $75,000. In addition, as compensation for our
non-employee directors participation on the committees of
our board of directors, on December 23, 2009, each of the
chairs of our executive, audit, compensation and nominating and
corporate governance committees received a grant of restricted
shares of our Series A common stock with a grant date fair
value of $15,000 and each member of our audit, compensation and
nominating and corporate governance committees (excluding the
chairs) received a grant of restricted shares of our
Series A common stock with a grant date fair value of
$5,000. All grants were made pursuant to our director plan. The
restricted shares vest quarterly over two years with the first
installment vested on February 13, 2010.
38
Director
Compensation Table
The following table sets forth compensation earned or paid to
our non-employee directors for services to our company during
the year ended December 31, 2009.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fees Earned
|
|
Stock
|
|
|
|
|
or Paid in
|
|
Awards
|
|
|
Name
|
|
Cash ($)
|
|
($)(1)(2)
|
|
Total ($)
|
|
Philip J. Holthouse
|
|
$
|
55,000
|
|
|
$
|
100,009
|
|
|
$
|
155,009
|
|
Brian C. Mulligan
|
|
$
|
55,000
|
|
|
$
|
100,009
|
|
|
$
|
155,009
|
|
Michael J. Pohl
|
|
$
|
55,000
|
|
|
$
|
100,009
|
|
|
$
|
155,009
|
|
Carl E. Vogel
|
|
$
|
4,219
|
|
|
$
|
95,022
|
|
|
$
|
99,241
|
|
|
|
|
(1) |
|
The aggregate grant date fair value of stock awards has been
computed in accordance with FASB ASC Topic 718, but (pursuant to
SEC regulations) without reduction for estimated forfeitures.
For a description of the assumptions applied in these
calculations, see Note 12 to our consolidated financial
statements for the year ended December 31, 2009 (which are
included in our Annual Report on
Form 10-K
as filed with the SEC on March 12, 2010). |
|
(2) |
|
As of December 31, 2009, our non-employee directors held
the following stock incentive awards: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Philip J.
|
|
Brian C.
|
|
Michael J.
|
|
Carl E.
|
|
|
Holthouse
|
|
Mulligan
|
|
Pohl
|
|
Vogel
|
|
Options
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
11,030
|
|
|
|
11,030
|
|
|
|
11,030
|
|
|
|
|
|
Restricted Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A
|
|
|
4,604
|
|
|
|
4,604
|
|
|
|
4,604
|
|
|
|
3,830
|
|
39
CERTAIN
RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Review
and Approval of Related Party Transactions
We adopted a code of ethics and corporate governance guidelines
to govern the review and approval of related party transactions.
Under our code of ethics, any transaction which may involve an
actual or potential conflict of interest and is required to be
disclosed pursuant to Item 404 of
Regulation S-K
promulgated by the SEC must be approved by the audit committee,
or another independent body of the board of directors designated
by our board. Under our corporate governance guidelines, if a
director has an actual or potential conflict of interest, the
director must promptly inform our Chief Executive Officer and
the chair of our audit committee. All directors must recuse
themselves from any discussion or decision that involves or
affects their personal, business or professional interests. In
addition, an independent committee of our board, designated by
our board, will resolve any conflict of interest issue involving
a director, our Chief Executive Officer or any other executive
officer. No related party transaction (as defined by
Item 404(a) of
Regulation S-K
promulgated by the SEC) may be effected without the approval of
such independent committee.
Transactions
with Related Persons
Services
Agreement with Liberty Media
Pursuant to the services agreement between Liberty Media and
DHC, which was assumed by our company in connection with the
spin-off, Liberty Media agreed to provide certain general and
administrative services including legal, tax, accounting,
treasury and investor relations support, as and to the extent
requested by us. We agreed to reimburse Liberty Media for
direct,
out-of-pocket
expenses incurred by Liberty Media in providing these services
and for our allocable portion of costs associated with any
shared services or personnel. The services agreement provides
for Liberty Media and our company to review cost allocations
every six months and adjust such charges, if appropriate. John
C. Malone, a director of our company, is the Chairman of the
Board of Liberty Media and beneficially owns Liberty Media
common stock representing approximately 35.2% of Liberty
Medias aggregate voting power as of March 31, 2010.
In 2009, we reimbursed Liberty Media approximately $156,000 for
(i) certain general and administrative services provided by
Liberty Media and (ii) the applicable portion of the 2009
base salary for Mr. Fitzgerald, our Chairman of the Board
and Chief Executive Officer, each pursuant to the services
agreement. See Executive Compensation
Employment Agreements Effect on Prior
Arrangements.
40
STOCKHOLDER
PROPOSALS
This proxy statement relates to our annual meeting of
stockholders for the calendar year 2010 which will take place on
July 9, 2010. We currently expect that our annual meeting
of stockholders for the calendar year 2011 will be held during
May or June of 2011. In order to be eligible for inclusion in
the proxy materials for the 2011 annual meeting, any stockholder
proposal must have been submitted in writing to our Corporate
Secretary and received at our executive offices at 12300 Liberty
Boulevard, Englewood, Colorado 80112, on or before the close of
business on January 28, 2011 unless a later date is
determined and announced in connection with the actual
scheduling of the annual meeting. To be considered for
presentation at the 2011 annual meeting, any stockholder
proposal must have been received at our executive offices at the
foregoing address on or before the close of business on
May 10, 2011 or such later date as may be determined and
announced in connection with the actual scheduling of the annual
meeting.
All stockholder proposals for inclusion in our proxy materials
will be subject to the requirements of the proxy rules adopted
under the Exchange Act and, as with any stockholder (regardless
of whether it is included in our proxy materials), our charter
and bylaws and Delaware law.
ADDITIONAL
INFORMATION
We file annual, quarterly and special reports, proxy materials
and other information with the SEC. You may read and copy any
document that we file at the Public Reference Room of the SEC at
450 Fifth Street, NW, Washington, D.C. 20549. You may
obtain information on the operation of the Public Reference Room
by calling the SEC at
1-800-SEC-0330.
You may also inspect our filings at the regional offices of the
SEC or over the Internet at the SECs website at
www.sec.gov. Additional information can also be found on
our website at
http://www.ascentmediacorporation.com.
(Information contained on any website referenced in this proxy
statement is not incorporated by reference in this proxy
statement.) If you would like to receive a copy of our Annual
Report on
Form 10-K
and/or
Amendment No. 1 on
Form 10-K/A
for the year ended December 31, 2009, or any of the
exhibits listed therein, please call or submit a request in
writing to Investor Relations, Ascent Media Corporation, 12300
Liberty Blvd., Englewood, Colorado 80112, telephone:
(720) 875-5622,
and we will provide you with the Annual Report or the Amendment
No. 1 without charge, or any of the exhibits listed therein
upon the payment of a nominal fee (which fee will be limited to
the expenses we incur in providing you with the requested
exhibits).
41
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Electronic Voting Instructions
You can vote by Internet or telephone!
Available 24 hours a day, 7 days a
week!
Instead of mailing your proxy, you may choose one of the two voting methods outlined below to vote your proxy.
VALIDATION
DETAILS ARE LOCATED BELOW IN THE TITLE BAR.
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Proxies submitted by the Internet or telephone must be received by
1:00 a.m., Central Time, on July 9, 2010. |
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Vote by
Internet · Log
on to the Internet and go to www.envisionreports.com/ASCMA · Follow the steps outlined on the secured website. |
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Vote by
telephone · Call toll free 1-800-652-VOTE (8683) within the USA,
US territories & Canada any time on a touch tone
telephone. There is NO CHARGE to you for the call. |
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Using a black ink pen, mark your votes with an X as shown in
this example. Please do not write outside the designated areas.
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x |
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· Follow the instructions provided by the recorded message. |
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Annual Meeting Proxy Card |
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▼
IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
▼
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A
Proposals The Board of Directors recommends a vote FOR
the nominees listed, FOR Proposal 2 and AGAINST Proposal 3. |
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1. |
Election of Directors: |
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For |
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Withhold |
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For |
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Withhold |
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+ |
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01 - Philip J. Holthouse*
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o
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o |
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02 - Brian C. Mulligan*
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o
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o
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*To serve as a Class II member of our board of directors until the 2013 annual meeting.
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For |
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Against |
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Abstain |
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For |
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Against |
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Abstain |
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2.
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Proposal to ratify the selection of KPMG LLP as our independent
auditors for the fiscal year ending December 31, 2010. |
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o
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o
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o |
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3. |
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Stockholder proposal relating to the redemption of the
preferred share purchase rights issued pursuant to our
Rights Agreement dated September 17, 2008, as amended.
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o
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o
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o |
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B Non-Voting Items |
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Change of Address Please print your new address below.
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Comments Please print your comments below.
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Meeting Attendance
Mark the box to the right
if you plan to attend the
Annual Meeting.
|
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o |
C |
Authorized
Signatures
This section must be completed for your vote to be counted.
Date and Sign Below
|
Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.
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Date (mm/dd/yyyy) Please print date below.
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Signature 1 Please keep signature within the box.
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Signature 2 Please keep signature within the box. |
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/ / |
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01797B |
2010 Annual Meeting Admission Ticket
2010 Annual Meeting of
Ascent Media Corporation Stockholders
Friday, July 9, 2010, 9:00 a.m.
The Fairmont Miramar Hotel
101 Wilshire Blvd., Santa Monica, CA
Upon arrival, please present this admission ticket
and photo identification at the registration desk.
DRIVING DIRECTIONS
From Los Angeles International Airport (LAX) via Freeways:
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Head east on Century Blvd. |
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Take the 405 San Diego Freeway North. |
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Transfer to the 10 Santa Monica Freeway West. |
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Exit at Fourth Street, turn right (heading North) on Fourth. |
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Make a left turn on Wilshire Boulevard, heading west. |
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Pass Second Street, the hotel will be on the right-hand side. |
From Los Angeles International Airport (LAX) via Surface Streets:
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Head North on Sepulveda Blvd. (#1). |
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Bear left, the left 2 lanes will become Lincoln Blvd. (#1) North. |
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Proceed North on Lincoln Blvd. through Marina Del Rey for about 7 miles. |
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Make a left turn on Wilshire Blvd. heading West for approximately 7 blocks. |
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Pass Second Street, the hotel will be on the right-hand side. |
▼
IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. ▼
Proxy Ascent Media Corporation
Notice of 2010 Annual Meeting of Stockholders
Proxy Solicited by Board of Directors for Annual Meeting July 9, 2010
The undersigned appoints William E. Niles and George C. Platisa and each of them, with power
to act without the other and with the right of substitution in each, the proxies of the undersigned
to vote all shares of Ascent Media Corporation Series A Common Stock and Ascent Media Corporation
Series B Common Stock held by the undersigned at the Annual Meeting of Stockholders to be held on
July 9, 2010, and at any adjournments thereof, with all the powers the undersigned would possess if
present in person. All previous proxies given with respect to the meeting are revoked.
IF NO DIRECTIONS ARE GIVEN, THE PROXIES WILL VOTE FOR THE ELECTION OF THE LISTED NOMINEES AND IN
ACCORDANCE WITH THE DIRECTORS RECOMMENDATIONS ON THE PROPOSALS LISTED ON THE OTHER SIDE OF THE
PROXY CARD. IN THE EVENT THAT ANY OTHER MATTER MAY PROPERLY COME BEFORE THE ANNUAL MEETING, OR ANY
ADJOURNMENT THEREOF, THE PERSONS SET FORTH ABOVE ARE AUTHORIZED, AT THEIR DISCRETION, TO VOTE THE
MATTER.
PLEASE SIGN ON THE OTHER SIDE AND RETURN PROMPTLY TO ASCENT MEDIA CORPORATION, C/O COMPUTERSHARE,
P.O. BOX 43102, PROVIDENCE, RI, 02940-0568. IF YOU DO NOT VOTE BY TELEPHONE OR INTERNET, OR SIGN
AND RETURN A PROXY CARD, OR ATTEND THE ANNUAL MEETING AND VOTE BY BALLOT, YOUR SHARES CANNOT BE
VOTED.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)