Item 1.01. Entry into a Material Definitive Agreement.
On June 16, 2021, News Corporation (the "Company") executed a fourth amended and
restated rights agreement (the "Rights Agreement"), between the Company and
Computershare Trust Company, N.A., as Rights Agent, which will be effective as
of June 18, 2021. The Rights Agreement was entered into pursuant to the
determination by a special committee of the Company's Board of Directors (the
"Board") comprising all of the Board's independent directors to amend and
restate the existing rights agreement, dated as of June 18, 2018, under which
the rights were originally set to expire on June 18, 2021. Under the Rights
Agreement, the expiration date of the rights is now 5:00 P.M. (New York City
time) on June 18, 2022. The Rights Agreement also provides for certain
immaterial technical and administrative amendments. The Rights Agreement
otherwise retains all other terms and provisions of the existing rights
agreement.
The foregoing description of the Rights Agreement is qualified in its entirety
by reference to the full text of the Rights Agreement, attached hereto as
Exhibit 4.1 and incorporated herein by reference.
Item 3.03. Material Modification to Rights of Security Holders.
See the description set forth herein under "Item 1.01. Entry into a Material
Definitive Agreement," which is incorporated into this Item 3.03 by reference.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On June 15, 2021, the Company and David B. Pitofsky, Executive Vice President,
General Counsel and Chief Compliance Officer of the Company, entered into an
Amended and Restated Employment Agreement, effective as of July 1, 2021 (the
"Amended and Restated Pitofsky Agreement"). The Amended and Restated Pitofsky
Agreement extends Mr. Pitofsky's term of employment until June 30, 2024 and
provides for an annual base salary of not less than $1,200,000; (ii) an annual
bonus with a target of not less than $1,200,000; and (iii) an annual long-term
equity incentive award with a target of not less than $1,600,000. These amounts
represent an increase over Mr. Pitofsky's fiscal 2021 annual base salary, annual
performance-based bonus target and annual performance-based equity incentive
award target of approximately 9%, 20% and 14%, respectively, with approximately
70% of Mr. Pitofsky's target compensation being "at risk." All bonus payments
and equity grants are subject to the Company's claw-back policies.
If Mr. Pitofsky's employment is terminated by the Company other than for cause
(as defined in the Amended and Restated Pitofsky Agreement) or due to Mr.
Pitofsky's death or disability, or by Mr. Pitofsky for Good Reason (as defined
in the Amended and Restated Pitofsky Agreement), the Amended and Restated
Pitofsky Agreement provides that Mr. Pitofsky will receive (i) the greater of
(A) his then-current base salary and target annual bonus paid in the same manner
as though Mr. Pitofsky continued to be employed through June 30, 2024 and (B)
his then-current base salary and target annual bonus paid in the same manner as
though he continued to be employed for the successive 24 months following the
date of termination; (ii) a pro rata portion of the annual bonus he would have
earned for the fiscal year of termination had no termination occurred (a
"Pro-rated Annual Bonus"); (iii) continued vesting of equity incentive awards
granted prior to the date of termination in the same manner as though he
continued to be employed through the later of June 30, 2024 or one year
following the date of termination, based on Company performance, where
applicable, and payable at the conclusion of the applicable vesting periods; and
(iv) Company-paid premiums under the Consolidated Omnibus Budget Reconciliation
Act of 1985, as amended, for the executive and his eligible dependents for the
successive 18 months following the date of termination. If Mr. Pitofsky's
employment is terminated due to his death or disability, he or his surviving
spouse or estate, as applicable, would be entitled to: (i) salary continuation
for up to 12 months (and, in the case of disability, continuation of other
benefits as well); (ii) any Pro-rated Annual Bonus; and (iii) (A) in the case of
disability, treatment of his outstanding equity incentive awards pursuant to the
terms of applicable plan documents or (B) in the case of death, continued
vesting of equity incentive awards granted prior to the date of termination in
the same manner as though he continued to be employed for a period of one year
following the date of termination. If, following the completion of the term
under the Amended and Restated Pitofsky Agreement on June 30, 2024, Mr. Pitofsky
is not offered a new employment agreement by the Company on terms at least as
favorable to him as the terms set forth in the Amended and Restated Pitofsky
Agreement, and Mr. Pitofsky is subsequently terminated without cause, then he
will be entitled to receive the payments and benefits summarized above with
respect to a termination other than for cause (using the same base salary and
target annual bonus as in effect immediately prior to the expiration of the term
on June 30, 2024). Payment of any compensation or benefits upon termination is
subject to Mr. Pitofsky's execution of the Company's then-standard separation
agreement and general release and continued compliance with the terms therein.
The Amended and Restated Pitofsky Agreement continues to have confidentiality
and other covenants to protect the Company.
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In addition, the Amended and Restated Pitofsky Agreement provides that if Mr.
Pitofsky is entitled to receive any "excess parachute payments" under Section
280G of the Internal Revenue Code of 1986, as amended, in connection with a
change in control, those payments will either be (i) reduced below the
applicable threshold, or (ii) paid in full, whichever is more favorable for Mr.
Pitofsky on a net after-tax basis. Mr. Pitofsky is not entitled to any golden
parachute excise tax or other tax "gross-up" payments.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit
Number Description
4.1 Fourth Amended and Restated Rights Agreement, effective as of June
18, 2021, between News Corporation and Computershare Trust Company,
N.A., as Rights Agent.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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