Filed by Bowne Pure Compliance
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): July 10, 2007
WESTWOOD ONE, INC.
(Exact name of registrant as specified in its charter)
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Delaware
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001-14691
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95-3980449 |
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(State or other jurisdiction of
incorporation)
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(Commission File Number)
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(IRS Employer Identification No.) |
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40 West 57th Street, 5th Floor |
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New York, NY
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10019 |
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(Address of principal executive offices)
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(Zip Code) |
Registrants telephone number, including area code: (212) 641-2000
(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)) |
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Section 5 |
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Corporate Governance and Management |
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Item 5.02 |
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Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers. |
(b) On July 12, 2007, Andrew Zaref ceased serving as Chief Financial Officer of Westwood One, Inc.
(the Company or Westwood). A copy of the press release announcing Mr. Zarefs
departure, as well as the other matters which are discussed in this 8-K, is furnished herewith as
Exhibit 99.1 and is incorporated by reference herein in its entirety.
(c) Gary Yusko was appointed Chief Financial Officer (CFO) of Westwood effective July 16, 2007.
Mr. Yuskos services will be provided by CBS Radio, Inc. (CBS Radio) to the Company in
accordance with CBS Radios existing agreement (the Management Agreement) to manage the
Company and to provide it with the services of a CFO. While Mr. Yusko will be an employee of the
Company, his salary and bonus payments will be reimbursed by CBS Radio. A copy of the Management
Agreement was previously filed with the Securities and Exchange Commission (SEC) as
Exhibit 10.17 to its Current Report on Form 8-K filed on June 4, 1999 and the amendment thereto was
filed with the SEC as Annex A to the Companys proxy statement on April 25, 2002.
Mr. Yusko and the Company have executed an employment agreement with a term of three years, at
an annual base salary of $450,000, $475,000 and $500,000, respectively. Mr. Yusko will be eligible
for an annual discretionary bonus for each of 2007, 2008 and 2009, in the amounts of $315,000 (of
which $100,000 is guaranteed for the services to be rendered for 2007), $332,500 and $350,000,
respectively. Mr. Yusko will also receive: (i) a signing bonus of $100,000 payable in a lump sum
in accordance with the Companys normal payroll practices and (ii) on July 16, 2007, 15,000 shares
of restricted stock which will vest in equal one-half increments over a two-year period on July 16,
2008 and 2009 (clauses (i) and (ii), collectively, the
Signing Bonus). The cash portion of the Signing
Bonus will be earned over the term of Mr. Yuskos
employment through July 15, 2009. On July 16, 2007, Mr. Yusko will
also receive: 50,000 shares of restricted stock and 75,000 stock options that will vest in equal
one-third increments on July 16, 2008, 2009 and 2010. A copy of the Companys employment agreement
with Mr. Yusko is attached hereto as Exhibit 99.2, the terms of which are incorporated by reference
herein in their entirety.
Mr. Yusko, 52, will serve as the Companys CFO and Principal Accounting Officer. Since March
2006, he has been the CFO of Alloy, Inc., a provider of non-traditional media programs reaching
targeted consumer segments. Prior to becoming Alloys CFO, Mr. Yusko served as the Companys
Executive Vice President (EVP) of Financial Operations for calendar year 2004 and Senior Vice
President of Financial Operations from 2002 to December 31, 2003. During such period, Mr. Yusko
also served as the Companys Secretary and Assistant Treasurer and after his tenure as EVP of
Financial Operations, he was employed by the Company until he became an officer of Alloy.
On July 10, 2007, the Compensation Committee approved the appointment of David Hillman as
the Companys Chief Administrative Officer (CAO, a newly created position), effective
immediately. As CAO, Mr. Hillman will have overall responsibility for the Companys corporate
development and strategic direction and will assist the Chief Executive Officer (CEO) in
overseeing the day-to-day operations of the Company. Mr. Hillman, 38, joined the Company in June
2000 as Vice President, Labor Relations and Associate General Counsel, which positions he held
through September 2004, and thereafter became Senior Vice President, General Counsel in October
2004. He became an EVP in February 2006 and will continue to serve as General Counsel and EVP,
Business Affairs. In connection with Mr. Hillmans promotion, on July 10, 2007, he received 15,000
shares of restricted stock that will vest in equal one-half increments on July 10, 2008 and 2009.
His employment agreement is also being amended as described in subsection (e) below.
(e) On July 10, 2007, the Compensation Committee approved amending the terms of equity compensation
awarded to Mr. Kosann during his tenure as President and CEO of the Company. The amended terms are
contingent on the CBS Transaction Condition (as described below). Mr. Kosann will continue to
serve as
President and CEO until the earlier of: (i) the closing of the overall CBS Radio Company deal
(but no earlier than December 31, 2007); or (ii) the day after the last day on which the Company
files its Annual Report on Form 10-K for the year ended 2007 (but no later than March 18, 2008).
Mr. Kosanns termination date is referred to in this 8-K as the Termination Date.
Under the amended terms, if the overall Company CBS Radio deal closes and Mr. Kosann is
terminated on the Termination Date in connection therewith, Mr. Kosann will execute an agreement to
serve the Company as a consultant beginning on the day after the Termination Date and continuing
through March 31, 2008 (the foregoing, the CBS Transaction Condition). During the period
of his consultancy, Mr. Kosanns outstanding equity compensation will continue to vest in
accordance with its current terms through and including
March 31, 2008. However, certain equity
compensation awarded to Mr. Kosann during his tenure as President and CEO of the Company that is
scheduled to vest after March 31, 2008 shall vest on March 31, 2008. Assuming the CBS
Transaction Condition is satisfied, the following units/shares of unvested equity compensation will
vest on March 31, 2008: (a) 5,208 restricted stock units (RSUs) (of 41,667 RSUs initially awarded
to Mr. Kosann on January 3, 2006 on a four-year vesting term), (b) 6,944 shares of restricted stock
(of 41,667 shares of restricted stock initially awarded to Mr. Kosann on March 13, 2007 on a
three-year vesting term) and (c) 20,833 stock options (of 125,000 stock options initially awarded
to Mr. Kosann on March 13, 2007 on a three -year vesting term) at an exercise price of $6.17 per
share. A copy of the Companys form Stock Option Agreement for non-director participants was
previously filed with the SEC as Exhibit 99.2 to the Companys 8-K on December 9, 2005. A copy of
the Companys form RSU agreement and form restricted stock agreement for non-director participants
was previously filed with the SEC as Exhibit 99.1 and Exhibit 99.3, respectively, to the Companys
8-K on March 17, 2006. A copy of the Companys Equity Plan was previously filed with the SEC as
Exhibit 10.2 to the Companys 8-K on May 25, 2005.
In addition, if
either: (1) the overall Westwood-CBS Radio deal closes and Mr. Kosann is
terminated on the Termination Date or (2) Mr. Kosann is involuntarily terminated as CEO
of the Company other than for Cause prior to the Termination Date (such, an Involuntary
Termination Event) and subsequent to the filing of a definitive proxy statement by the
Company in connection with the overall Westwood-CBS Radio deal, Westwood One will reimburse CBS
Radio for one-half (1/2) of Mr. Kosanns salary continuation through December 31,
2008 and 2007 bonus payments (which total bonus payment shall be a minimum of $150,000), subject
to an agreed-upon cap between the parties. If the Involuntary Termination Event occurs at the
request of the Company prior to the filing of a definitive proxy statement by the
Company in connection with the overall Westwood-CBS Radio deal, the Company will reimburse CBS
Radio only for one-half (1/2) of Mr. Kosanns minimum 2007 bonus payment. Except in the cases described
above, CBS Radio shall be solely responsible for all cash payments to Mr. Kosann in connection with
the cessation of his employment with CBS Radio as the Companys CEO.
As described in
subsection (c) above, on July 10, 2007, the Compensation Committee approved the
appointment of David Hillman as the Companys CAO. In connection therewith,
Mr. Hillmans employment agreement is being amended to extend the term thereof for one
year until December 31, 2009. Additionally, Mr. Hillman will receive an increase in his
annual base salary (previously $350,000) as follows: (i) effective July 16, 2007,
$400,000; (ii) effective January 1, 2008, $425,000; and (iii) effective
January 1, 2009, $450,000. As described in subsection (c) above, Mr. Hillman received
15,000 shares of restricted stock on July 10, 2007. A copy of the amendment to Mr.
Hillmans employment agreement is attached hereto as Exhibit 99.3, the terms of which are
incorporated by reference herein in their entirety.
As part of the press release issued on July 12, 2007, a copy of which is attached hereto as
Exhibit 99.1, the Company also updated the status of its ongoing negotiations with CBS Radio
regarding the modification and extension of the agreements between the parties. The Company
announced it is optimistic that it will finalize the new arrangements with CBS Radio in August 2007
and submit definitive documentation detailing the new arrangements to Company stockholders for
their approval in the fourth quarter of 2007, following the Companys filing of a definitive proxy
statement with the SEC. As stated in the press release, there is no assurance that the extension
of the Companys various agreements with CBS Radio will be completed. The Company also
announced that UBS Investment Bank is continuing to advise the Companys Strategic Review
Committee in its negotiation and documentation of the CBS Radio agreements and the Committees
mandate to explore avenues to enhance shareholder value.
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Section 9 |
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Financial Statements and Exhibits |
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Item 9.01 |
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Financial Statements and Exhibits. |
(d) |
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Exhibits. |
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The following is a list of the exhibits filed as a part of this Form 8-K: |
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Exhibit |
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No. |
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Description of Exhibit |
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99.1 |
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Press Release, dated July 12, 2007, announcing the update regarding
status of the CBS Radio negotiations; cessation of Andrew Zaref as Chief
Financial Officer of the Company; appointment of Gary Yusko as Chief
Financial Officer; appointment of David Hillman as Chief Administrative
Officer and the ultimate cessation of Peter Kosanns services as
Chief Executive Officer. |
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99.2 |
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Employment Agreement, effective as of July 16, 2007, by and between the
Company and Gary Yusko. |
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99.3 |
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Amendment No. 2, effective July 10, 2007, to the Employment
Agreement, entered into by and between Westwood One, Inc. and David Hillman, effective as of
October 16, 2004, as amended. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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WESTWOOD ONE, INC.
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Date: July 16, 2007 |
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/s/ David Hillman
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Name: |
David Hillman |
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Title: |
Chief Administrative Officer; EVP,
Business Affairs; General Counsel and
Secretary |
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EXHIBIT INDEX
Current Report on Form 8-K
dated July 10, 2007
Westwood One, Inc.
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Exhibit |
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No. |
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Description of Exhibit |
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99.1
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Press Release, dated July 12, 2007, announcing the update
regarding status of the CBS Radio negotiations; cessation of
Andrew Zaref as Chief Financial Officer of the Company;
appointment of Gary Yusko as Chief Financial Officer; appointment
of David Hillman as Chief Administrative Officer and the ultimate
cessation
of Peter Kosanns services as Chief Executive Officer. |
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99.2 |
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Employment Agreement, effective as of July 16, 2007, by and
between the Company and Gary Yusko. |
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99.3 |
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Amendment No. 2, effective July 10, 2007, to the Employment
Agreement, entered into by and between Westwood One, Inc. and David Hillman, effective as of
October 16, 2004, as amended. |