UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): November 11, 2008
ASCENT MEDIA CORPORATION
(Exact name of registrant as specified in its charter)
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Delaware
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001-34176
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26-2735737 |
(State or other jurisdiction of
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(Commission
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(I.R.S. Employer |
incorporation or organization)
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File Number)
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Identification No.) |
12300 Liberty Boulevard
Englewood, Colorado 80112
(Address of principal executive offices and zip code)
Registrants telephone number, including area code: (720) 875-5622
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
Item 5.02(e) Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers
On November 11, 2008, the compensation committee (the Committee) of the board of directors
of Ascent Media Corporation (the Corporation) approved a compensation package, including base
salary, fringe benefits, bonus, incentive compensation and severance components, payable to Mr.
William Fitzgerald in his capacity as Chief Executive Officer of the Corporation (the Fitzgerald
Compensation Package).
Salary and Benefits. Pending execution of the employment agreement described below, Mr.
Fitzgerald provides services to the Corporation under the Services Agreement, dated as of July 21,
2005 (the Services Agreement), by and between Discovery Holding Company (DHC) and Liberty Media
Corporation (LMC), which Services Agreement was assigned by DHC to the Corporation in connection
with the September 2008 spin-off of the Corporation from DHC (the Spin-Off). Under the Services
Agreement, as assigned, LMC has agreed to make available the services of certain LMC personnel,
including Mr. Fitzgerald, to the Corporation, and the Corporation has agreed to reimburse LMC for
that portion of such personnels salary and benefits as allocated to such personnels services to
the Corporation. Pursuant to the Fitzgerald Compensation Package, of Mr. Fitzgeralds annual
salary ($710,000), 60% or $426,000 (the Allocated Annual Salary) will be allocated to the
Corporation under the Services Agreement, which allocation will be adjusted semi-annually to
reflect the actual proportion of Mr. Fitzgeralds time devoted to the performance of services to
the Corporation. The cost of health and other welfare benefits will be allocated on the same basis
under the Services Agreement.
Bonus. Mr. Fitzgerald is eligible to receive an annual bonus from the Corporation equal to
75% of the Allocated Annual Salary (the Target Bonus).
The actual bonus paid may be greater than
75% but may not exceed 150% of the Allocated Annual Salary. Mr. Fitzgeralds entitlement to such
bonus, and the percentage amount of such bonus, will be determined by the Committee in its sole
discretion based upon Mr. Fitzgeralds achievement of certain performance criteria.
Stock Options. As incentive compensation under the Fitzgerald Compensation Package and the
Ascent Media Corporation 2008 Incentive Plan (the Incentive Plan), the Corporation granted to Mr.
Fitzgerald options (the Options) to purchase 347,059 shares of the Corporations Series A Common
Stock, par value $0.01 (the Series A Stock). The award of Options had an effective grant date of
November 13, 2008. The Options have an exercise price of $21.81 (the closing market price on the
grant date), will vest quarterly over a four-year period and will be exercisable for a maximum of
ten years, subject to certain earlier termination if Mr. Fitzgeralds service as Chief Executive
Officer terminates for certain reasons.
Restricted Shares. As incentive compensation under the Fitzgerald Compensation Package and
the Incentive Plan, the Corporation granted to Mr. Fitzgerald 91,701 restricted shares of Series A
Stock (the Restricted Shares), which restricted shares will vest quarterly over a four-year
period. The award of Restricted Shares had an effective grant date of November 13, 2008.
Severance Following Change in Control. Pursuant to the Fitzgerald Compensation Package, if,
within twelve months following a change in control of the Corporation, Mr. Fitzgeralds services to
the Corporation are terminated by the Corporation without cause or by Mr. Fitzgerald for good
reason (as each such term is defined in the Fitzgerald Compensation Package):
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Mr. Fitzgerald will be entitled to a severance amount equal to (i) the
sum of the Allocated Annual Salary plus the Target Bonus, multiplied by
(ii) 2.5; and |
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all restricted shares of the Corporations common stock, options to
purchase the Corporations common stock and any phantom appreciation rights
that may be issued pursuant to the Ascent Media Group, LLC 2006 Long-Term
Incentive Plan (As Amended and Restated Effective September 9, 2008), in
each case held by Mr. Fitzgerald, will fully vest, to the extent not
previously vested, and the exercise period of any such options will be
extended to the last day of the maximum term length applicable to such
options in the absence of termination. |
Employment Agreement. The Fitzgerald Compensation Package contemplates that the Committee and
Mr. Fitzgerald will negotiate in good faith and enter into an employment agreement, which
employment agreement, it is anticipated, shall (i) have a five year term, (ii) provide that Mr.
Fitzgerald shall devote sufficient time to the performance of his duties as Chief Executive Officer
of the Corporation, which time shall constitute no less than 60% of the aggregate time spent by Mr.
Fitzgerald in performance of his duties to both the Corporation and LMC and (iii) set forth other
terms and conditions of employment consistent with the terms and conditions of the Fitzgerald
Compensation Package.