UNITED STATES SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C.
20549
Form 10-K/A
Amendment No. 1
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended
December 31, 2007
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OR
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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For the transition period
from to
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Commission File
No. 001-33902
FX Real Estate and
Entertainment Inc.
(Exact name of Registrant as
specified in its charter)
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Delaware
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36-4612924
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(State or other jurisdiction
of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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650 Madison Avenue
New York, New York 10022
(Address of Principal Executive
Offices and Zip Code)
Registrants Telephone Number, Including Area Code:
(212) 838-3100
Securities Registered Pursuant to Section 12(b) of the
Act:
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, Par Value $0.01 Per Share
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The NASDAQ Global Market LLC
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Securities Registered Pursuant to Section 12(g) of the
Act:
None
Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities
Act. Yes
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No
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Indicate by check mark if the registrant is not required to file
reports pursuant to Section 13 or 15(d) of the Exchange
Act. Yes
o
No
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Indicate by check mark whether the issuer (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Exchange Act during the preceding 12 months (or for such
shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing
requirements for the past
90 days. Yes
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No
o
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of
Regulation S-K
is not contained herein, and will not be contained, to the best
of the registrants knowledge, in definitive proxy or
information statements incorporated by reference in
Part III of this
Form 10-K
or any amendment to this
Form 10-K.
þ
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer
or a smaller reporting company (as defined in Exchange Act
Rule 12b-2).
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated
filer, or a smaller reporting company. See the definitions of
large accelerated filer, accelerated
filer and smaller reporting company in Rule
12b-2
of the
Exchange Act. (Check one):
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Large
accelerated
filer
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Accelerated
filer
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Non-accelerated
filer
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Smaller
reporting
company
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(Do
not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company
(as defined in
Rule 12b-2
of the Exchange
Act). Yes
o
No
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On January 10, 2008, shares of the registrants common
stock were distributed to the stockholders of CKX, Inc., and
began trading on The NASDAQ Global Market on that same date. As
such, the registrants common equity cannot state the
aggregate market value of its common stock held by
non-affiliates as of June 29, 2007, the last business day
of its most recent completed second fiscal quarter, because the
registrants common stock was not publicly traded as of
such date.
As of April 25, 2008, there were 44,692,809 shares of
the registrants common stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE: None.
FX Real
Estate and Entertainment Inc.
EXPLANATORY NOTE
FX Real Estate and Entertainment Inc. is filing this Amendment
No. 1 (the Amended Report) to our Annual Report
on
Form 10-K
for the fiscal year ended December 31, 2007, as originally
filed with the Securities and Exchange Commission on
March 24, 2008 (the Original Report), solely to
amend and restate Item 5 of Part II, Items 10,
11, 12, 13 and 14 of Part III and Item 15 of
Part IV of the Original Report. This Amended Report does
not affect any other items in our Original Report. Filed as
exhibits to this Amended Report are the certifications pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002. Because
no financial statements are contained in this Amended Report,
certifications pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 are omitted.
Except as otherwise expressly stated in the items contained in
this Amended Report, this Amended Report continues to speak as
of the date of the Original Report and we have not updated the
disclosure contained herein to reflect events that have occurred
since the filing of the Original Report. Accordingly, this
Amended Report should be read in conjunction with our Original
Report and our other filings made with the Securities and
Exchange Commission subsequent to the filing of the Original
Report. The filing of this Amended Report shall not be deemed an
admission that the Original Report when filed included any
untrue statement of a material fact or omitted to state a
material fact necessary to make a statement therein not
misleading.
In this Amended Report, the words we,
us, our, FXRE, and the
Company collectively refer to FX Real Estate and
Entertainment Inc., and its consolidated subsidiaries, FX Luxury
Realty, LLC, BP Parent, LLC, Metroflag BP, LLC and Metroflag
Cable, LLC. Some of the descriptive material in this Amended
Report refers to the assets, liabilities, operations, results,
activities or other attributes of the historical business
conducted by FX Luxury Realty and its predecessors, including BP
Parent, LLC, Metroflag BP, LLC, Metroflag Cable, LLC, Metroflag
Polo, LLC, CAP/TOR, LLC, Metroflag SW, LLC, Metroflag HD, LLC
and Metroflag Management, LLC, as if it had been conducted by
us. We sometimes refer to these predecessor entities
collectively herein as Metroflag or the
Metroflag entities.
Form 10-K/A
TABLE OF
CONTENTS
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Page
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Market for Registrants Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities
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1
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PART III
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Directors, Executive Officers and Corporate Governance
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2
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Executive Compensation
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6
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Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters
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12
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Certain Relationships and Related Transactions, and Director
Independence
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13
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Principal Accountant Fees and Services
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19
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PART IV
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Exhibits and Financial Statement Schedules
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20
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EX-31.1: CERTIFICATION
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EX-31.2: CERTIFICATION
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PART II
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ITEM 5.
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MARKET
FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
AND ISSUER PURCHASES OF EQUITY SECURITIES
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Market
Information
Since January 10, 2008, our common stock, par value $.01
per share (the Common Stock) has been listed and
traded on The NASDAQ Global
Market
®
under the ticker symbol FXRE.
Prior to January 10, 2008 there was no established public
trading market for our Common Stock.
Dividend
Policy
We have not paid and have no present intentions to pay cash
dividends on our Common Stock. In addition, the terms of the
Park Central Loan, as described elsewhere herein, and the terms
of any future debt agreements we may enter into are likely to
prohibit or restrict, the payment of cash dividends on our
Common Stock.
Securities
Authorized for Issuance Under Equity Compensation
Plans
See the disclosure regarding securities authorized for issuance
under our equity compensation plans that is included below under
the heading
Item 12. Security Ownership of Certain
Beneficial Owners and Management and Related Stockholder
Matters Securities Authorized for Issuance Under
Equity Compensation Plans
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Recent
Sales of Unregistered Securities
On November 29, 2007, we reclassified our Common Stock on a
basis of 194,515.758 shares of Common Stock for each share
of Common Stock then outstanding. All sales of shares of Common
Stock described below which occurred prior to November 29,
2007 are adjusted to give share numbers on a
post-reclassification basis.
On June 18, 2007, we issued 194,516 shares of Common
Stock to CKX. CKX then transferred and assigned to Distribution
Trust II all such shares of Common Stock to hold on behalf
of CKXs stockholders until the completion of the CKX
Distribution. On September 26, 2007, CKX, Distribution I
and Flag Luxury Properties exchanged all of their common
membership interests in FX Luxury Realty for
38,706,699 shares of our Common Stock in connection with
completing the reorganization.
On September 26, 2007, we sold 291,774 shares of
Common Stock to CKX for $1.5 million and 97,258 shares
of Common Stock to Flag Luxury Properties for $0.5 million.
On January 3, 2008, we sold 500,000 shares of Common
Stock to Barry Shier, our Chief Operating Officer, for
$2.57 million.
On January 9, 2008, we entered into investment agreements
with The Huff Alternative Fund, L.P. and The Huff Alternative
Parallel Fund, L.P. (collectively, Huff) and
Mr. Sillerman whereby they have agreed to purchase shares
of Common Stock that are not sold in the rights offering.
Pursuant to these investment agreements, as amended, Huff is
obligated, at the option of the Company, to purchase
(i) the first $15 million of shares (1.5 million
shares at $10 per share) of Common Stock that are not subscribed
for in the rights offering
less
the aggregate purchase
price paid by Huff for shares upon exercise of its own rights in
the rights offering (the
Initial Tranche
),
and (ii) 50% of any other unsubscribed shares of Common
Stock, up to a total investment of $40 million;
provided, however
, Huff is not obligated to purchase any
shares of Common Stock beyond the Initial Tranche in the event
that Mr. Sillerman does not purchase an equal number of
shares of Common Stock at the $10 price per share.
Mr. Sillerman agreed to exercise all of his rights in the
rights offering and purchase up to 50% of the shares of Common
Stock that are not sold in the rights offering after Huffs
purchase of the Initial Tranche. On March 12, 2008,
Mr. Sillerman exercised his rights and purchased
3,037,265 shares of Common Stock at a purchase price of
$10.00 per share pursuant to his investment agreement.
No underwriters were used in the foregoing transactions. The
sales were made in reliance upon the exemption from registration
provided by Section 4(2) of the Securities Act for
transactions by an issuer not involving a public offering.
1
PART III
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ITEM 10.
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DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
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Executive
Officers and Directors of FX Real Estate and Entertainment
Inc.
The Companys board of directors is currently comprised of
six members: Robert F.X. Sillerman (Chairman), Paul C. Kanavos,
Barry A. Shier, Thomas P. Benson, David M. Ledy and Harvey
Silverman. The size of our board will subsequently be increased
to accommodate the expected appointment of the Independent
Director Nominee(s) and the Huff designated director, each as
more fully described below. Each director will hold office, in
accordance with our certificate of incorporation and bylaws, for
a term of one year or until his or her successor is duly elected
and qualified at an annual meeting of our stockholders. Other
than as described below, there are no voting agreements or other
contractual arrangements relating to the election of the members
of our board.
The following table lists the names, ages and positions of the
persons who are our current directors, director nominees and
executive officers as of April 25, 2008:
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Name
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Age
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Position
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Robert F.X. Sillerman
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Chairman and Chief Executive Officer
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Paul C. Kanavos
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50
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Director, President
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Barry A. Shier
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52
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Director, Chief Operating Officer
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Thomas P. Benson
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Executive Vice President, Chief Financial Officer, Director
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Brett Torino
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49
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Chairman - Las Vegas Division
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Mitchell Nelson
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60
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Executive Vice President, General Counsel, Secretary
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David M. Ledy
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58
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Director
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Harvey Silverman
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66
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Director
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Carl D. Harnick
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73
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Director Nominee
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Robert F.X. Sillerman
has served as Chairman of the board
of directors and Chief Executive Officer since January 10,
2008. Mr. Sillerman has served as the Chief Executive
Officer and Chairman of CKX since February 2005. Prior to that,
Mr. Sillerman was Chairman of FXM, Inc., a private
investment firm, from August 2000 through February 2005.
Mr. Sillerman is the founder and has served as managing
member of FXM Asset Management LLC, the managing member of MJX
Asset Management, a company principally engaged in the
management of collateralized loan obligation funds, from
November 2003 through the present. Prior to that,
Mr. Sillerman served as the Executive Chairman, a Member of
the Office of the Chairman and a director of SFX Entertainment,
Inc. from its formation in December 1997 through its sale to
Clear Channel Communications in August 2000.
Paul C. Kanavos
was elected a Director and appointed
President on August 20, 2007. Mr. Kanavos is the
Founder, Chairman and Chief Executive Officer of Flag Luxury
Properties, LLC. Prior to founding Flag Luxury Properties, he
worked for over 20 years at the head of Flag Management.
Most recently he has developed Ritz-Carltons in South Beach,
Coconut Grove and Jupiter as well as Temenos Anguilla. Mr.
Kanavos early career experience includes a position at
Chase Manhattan Bank, where he negotiated, structured and closed
over $1 billion in loans.
Barry Shier
was appointed Chief Operating Officer and
elected a Director on December 31, 2007. From 1984 through
May 2000, Mr. Shier served in various executive capacities
for Mirage Resorts, Inc. and Golden Nugget, Inc., a subsidiary
of Mirage Resorts. During his tenure, he was intimately involved
in design development, marketing and operations for the parent
company. Mr. Shier served as the Chairman and Chief
Executive Officer for both Golden Nugget Las Vegas Corporation,
and Beau Rivage Resort and Casino in Biloxi, Mississippi. He
retired from Mirage Resorts, Inc in May 2000, upon the sale of
the company to MGM. Since his retirement from Mirage Resorts in
May 2000, Mr. Shier has focused his efforts on private
investments, and has done select gaming and hotel industry
consulting and lecturing, as well as various philanthropic
activities.
2
Thomas P. Benson
has served as a Director and Chief
Financial Officer since January 10, 2008. Mr. Benson
has served as the Executive Vice President, Chief Financial
Officer and Treasurer of CKX since February 2005 and was a
director of CKX from February 2005 through May 2006.
Mr. Benson also serves as Executive Vice President and
Chief Financial Officer of MJX Asset Management, and serves on
the management advisory committee of FXM Asset Management.
Mr. Benson has been with MJX since November 2003.
Mr. Benson was Chief Financial Officer at FXM, Inc. from
August 2000 until February 2005. Mr. Benson served as a
Senior Vice President and Chief Financial Officer of SFX
Entertainment from March 1999 to August 2000, and as the Vice
President, Chief Financial Officer and a director of SFX
Entertainment from December 1997.
Brett Torino
has served as Chairman of our Las Vegas
Division since December 31, 2007. Since 1999, Brett Torino
has served as the Chief Executive Officer and President of
Torino Companies, LLC, which was founded in 1976.
Mr. Torino has led the development, construction and sale
of commercial, residential and resort properties in California,
Colorado. Nevada and Arizona. The Torino Companies consist of a
group of wholly owned and geographically diverse affiliated
companies best known for their attached housing, multi-family
residential projects and commercial developments.
Mitchell Nelson
has served as Executive Vice President
and General Counsel since December 31, 2007. Mitchell J.
Nelson has served as Senior Vice President of Corporate Affairs
for Flag Luxury Properties, LLC since February, 2003. He has
also served as President of Atlas Real Estate Funds, Inc., a
private investment fund which invests in United States-based
real estate securities, and as counsel to various law firms
since 1994. Prior to that, he was a senior real estate partner
at the law firm of Wien, Malkin & Bettex, with
supervisory responsibility for various commercial properties.
Mr. Nelson was a director of The Merchants Bank of New York
and its holding company until its merger with, and remains on
the Advisory Board of, Valley National Bank. Additionally, he
has served on the boards of various not-for-profit
organizations, including as a director of the 92nd Street
YMHA and a trustee of Collegiate School, both in New York City.
David M. Ledy
was elected a director of the Company in
October 2007. Since June 30, 2004, he has served as the
Chief Operating Officer of U.S. Realty Advisors, LLC, or
USRA. USRA is an equity investor in corporate real estate and
provides real estate advisory services to a diverse base of
clients, including public companies, financial institutions as
well as major private developers and investors. Prior to that,
Mr. Ledy served as Executive Vice President of USRA from
April 15, 1991 to June 30, 2004. Prior to joining USRA
in 1991, Mr. Ledy was a partner in the New York law firm of
Shea & Gould where he was a member of the real estate
department and chairman of the real estate workout group.
Mr. Ledy was admitted to the United States District Court
for the Southern District of New York in 1975 and the Courts of
the State of New York in 1975.
Harvey Silverman
was elected a director of the Company in
October 2007. Mr. Silverman was a principal of Spear,
Leeds & Kellogg, a major specialist firm on the New
York Stock Exchange, for 39 years until its acquisition by
Goldman Sachs & Co. in October of 2000. Since then,
Mr. Silverman has been a private investor.
Independent
Director Nominee
Carl D. Harnick currently serves as an independent director on
the board of directors of CKX. Upon the closing of the CKX going
private transaction, Mr. Harnick will resign from the Board
of Directors of CKX and will be immediately appointed to serve
as an Independent Director of our company. Upon his expected
appointment to serve on the board, it is anticipated that
Mr. Harnick will be appointed to serve as Chairman of our
Audit Committee, a position that he currently holds with respect
to the CKX board of directors. A complete biography for
Mr. Harnick is set forth below.
Carl D. Harnick
served as Vice President and Chief
Financial Officer of Courtside Acquisition Corp from
March 18, 2005 to July 2, 2007. Mr. Harnick was a
partner with Ernst & Young and its predecessor for
thirty years, retiring from the firm in September 1997. Since
leaving Ernst & Young, Mr. Harnick has provided
financial consulting services to various organizations,
including Alpine Capital, a private investment firm, at various
times since October 1997. He was a director of Platinum
Entertainment, Inc., a recorded music company, from April 1998
through June 2000, Classic Communications, Inc., a cable
television company, from January 2000 through January 2003, and
Sport Supply Group, Inc., a direct mail marketer of sporting
goods, from April 2003 through August
3
2004, and currently serves as a director and chairman of the
audit committee of CKX. Mr. Harnick has been the Treasurer
as well as a Trustee for Prep for Prep, a charitable
organization, for more than fifteen years.
In addition to Mr. Harnick, we expect that one or more of
the current independent directors for CKX will be appointed to
our board of directors upon consummation of 19Xs
acquisition of CKX. If the CKX going private transaction is not
completed by January 10, 2009 or at all, we will, to the
extent necessary to comply with The NASDAQ Global Markets
independence requirements, identify and appoint other
individuals who qualify as independent to serve as
directors.
The Huff
Director
In addition to the shares of our Common Stock to be purchased by
Huff pursuant to its investment agreement with us as described
elsewhere herein, Huff will purchase one share of our special
preferred stock for a purchase price of $1.00.
Under the terms of the to-be-created special preferred stock,
Huff will be entitled to appoint one member to our board of
directors. Huff will be entitled to appoint a member to our
board of directors so long as it continues to beneficially own
at least 20% of the shares of our Common Stock it acquired in
(x) the CKX Distribution, (y) the rights offering and
(z) under the investment agreement. Once Huff ceases to
beneficially own 20% of these shares, we will have the right to
convert the special preferred stock into one share of common
stock. Under the terms of this special preferred stock, the Huff
director designee shall have the right, subject to any
restrictions of The NASDAQ Global Market or the Securities and
Exchange Commission (the SEC), or applicable law, to
be a member of, and the chairman of, any committee of the board
of directors formed for the purpose of reviewing any
related party transaction that is required to be
disclosed pursuant to Section 404 of the Sarbanes Oxley Act
of 2002 or any successor rule or regulation or any transaction,
contract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any of our directors, officers or
affiliates, including any such committee that may be formed
pursuant to the applicable rules and regulations of the SEC or
The NASDAQ Global Market. However, if the Huff director designee
would not be deemed independent or disinterested with respect to
a related party transaction and therefore would not satisfy The
NASDAQ Global Market or other applicable requirements for
serving on the special committee formed with respect thereto,
the Huff director designee will not serve on the relevant
special committee but will have the right to attend meetings of
such special committee as an observer, subject to any
restrictions of The NASDAQ Global Market or applicable law.
Furthermore, in the event that the attendance at any meetings of
any such special committee would raise confidentiality issues as
between the parties to the transaction that, in the reasonable
opinion of counsel to the relevant special committee, cannot be
resolved by a confidentiality agreement, the Huff director
designee shall be required to recuse himself from such meetings.
Bryan Bloom is expected to serve as the Huff director designee.
He has served as counsel of W.R. Huff Asset Management Co.,
L.L.C. and its affiliates for the past thirteen years. Prior to
being employed by Huff, he was a tax partner at the law firm of
Shanley & Fisher, P.C. Mr. Bloom is a
Trustee of the Adelphia Recovery Trust, and has served on the
Board of Impsat Communications and numerous privately held
companies. He has been an adjunct professor at the graduate tax
program at the Fairleigh Dickenson University and authored and
lectured for the American Institute of Certified Public
Accountants.
Section 16(a)
Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as
amended (the Exchange Act) requires our directors
and officers, and persons who own more than 10% of our
outstanding Common Stock to file with the SEC initial reports of
ownership and changes in ownership of our Common Stock. Such
individuals are also required to furnish us with copies of all
such ownership reports they file.
Because our Common Stock was not registered under
Section 12 of the Exchange Act at any time during the year
ended December 31, 2007, our directors and executive
officers and greater than 10% stockholders were not subject to
or required to file reports under Section 16 of the
Exchange Act during 2007.
4
Code of
Business Conduct and Ethics
The Company has adopted a Code of Business Conduct and Ethics,
which is applicable to all our employees and directors,
including our principal executive officer, principal financial
officer, principal accounting officer or controller or persons
performing similar functions. The Code is posted on our website
located at www.fxree.com.
We intend to satisfy the disclosure requirements under
Item 5.05 of
Form 8-K
regarding an amendment to, or waiver from, a provision of our
Code of Business Conduct and Ethics that applies to our
principal executive officer, principal financial officer,
principal accounting officer or controller, or persons
performing similar functions by posting such information on our
website at www.fxree.com.
Corporate
Governance Guidelines
The Company has Corporate Governance Guidelines which provide,
among other things, that a majority of the Companys board
of directors must meet the criteria for independence required by
The NASDAQ Stock
Market
®
and that the Company shall at all times have a standing Audit
Committee, Compensation Committee and Nominating and Corporate
Governance Committee, which committees will be made up entirely
of independent directors. The Corporate Governance Guidelines
also outline director responsibilities, provide that the board
of directors shall have full and free access to officers and
employees of the Company and require the board of directors to
conduct an annual self-evaluation to determine whether it and
its committees are functioning effectively. The Corporate
Governance Guidelines and the charters for these committees can
be found on the Companys website at
www.fxree.com
.
Board
Committees
The following chart sets forth the current membership of each
board committee during 2007. The board of directors reviews and
determines the membership of the committees at least annually.
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Committee
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Members
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Audit Committee
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David M. Ledy (Chairman)
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Harvey Silverman
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Compensation Committee
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David M. Ledy (Chairman)
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Harvey Silverman
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Nominating and Corporate Governance Committee
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Harvey Silverman (Chairman)
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David M. Ledy
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Audit
Committee
The Audit Committee is comprised of Messrs. Ledy and
Silverman. Mr. Ledy is the Chairman of the Audit Committee.
The Audit Committee assists our board of directors in fulfilling
its responsibility to oversee managements conduct of our
financial reporting process, including the selection of our
outside auditors, review of the financial reports and other
financial information we provide to the public, our systems of
internal accounting, financial and disclosure controls and the
annual independent audit of our financial statements.
All members of the Audit Committee are independent within the
meaning of the rules and regulations of the SEC, the
requirements of The NASDAQ Stock
Market
®
and our Corporate Governance Guidelines. In addition,
Mr. Ledy is qualified as an audit committee financial
expert under the regulations of the SEC and has the accounting
and related financial management expertise required by The
NASDAQ Stock
Market
®
.
5
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ITEM 11.
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EXECUTIVE
COMPENSATION
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Executive
Compensation
During the year ended December 31, 2007, we did not pay any
compensation to our executive officers, Messrs. Kanavos,
Shier, Nelson and Torino, other than the grant of stock options.
On December 31, 2007, in accordance with the terms of their
employment agreements and under the terms of our 2007 Executive
Equity Incentive Plan, stock options were granted to
Messrs. Kanavos, Shier, Nelson and Torino to purchase up to
750,000, 1,500,000, 400,000 and 400,000 shares of our
common stock, respectively. The stock options granted to
Messrs. Kanavos, Nelson and Torino vest ratably over a five
year period from the date of grant and have an exercise price of
$20.00 per share. The stock options granted to Mr. Shier
vest ratably over a two year period from the date of grant, with
all of these options becoming exercisable at the end of such
two-year period, and have an exercise price of $10.00 per share.
For purposes of the Securities and Exchange Commissions
executive compensation rules, none of these executive officers
are deemed to have received any reportable cash compensation in
2007 from having been granted these stock options because we did
not record any compensation expense for them in our audited
consolidated financial statements for the year ended
December 31, 2007 included elsewhere herein. We did not
record any such compensation expense because these options were
granted at year end and corresponding expense was not material
to our statement of operations included in our consolidated
financial statements.
Compensation
Discussion and Analysis
We are newly formed and have only recently begun making payments
to our executive officers pursuant to their employment
agreements, as more fully described below under
Employment Contracts
.
Consequently, the consideration of our compensation programs to
date has been limited.
We expect to more fully develop our compensation plans going
forward by using a combination of data regarding historical pay,
publicly available compensation data for public companies that
are engaged in our industry, in related industries, or that
possess size or other characteristics which are similar to ours,
and data which may be obtained by a compensation consultant for
us on public and private companies. We also expect to consider
other factors, including but not limited to:
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the individuals background, training, education and
experience;
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the individuals role with us and the compensation paid to
individuals in similar roles in the companies we consider to
have characteristics similar to ours;
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the market demand for specific expertise possessed by the
individual;
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the goals and expectations for the individuals position
and his or her success in achieving these goals; and
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a comparison of the individuals pay to that of other
individuals within the company with similar title, role,
experience and capabilities.
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Compensation
Committee
We have a standing Compensation Committee comprised of
Messrs. Ledy and Silverman. Mr. Ledy is the Chairman
of the Compensation Committee. The Compensation Committee
represents our Company in reviewing and approving the executive
employment agreements with our Chief Executive Officer,
President, Chief Operating Officer, Chief Financial Officer,
Chairman-Las Vegas Division and General Counsel. The
Compensation Committee also reviews managements
recommendations with respect to executive compensation and
employee benefits and is authorized to act on behalf of the
board of directors with respect thereto. The Compensation
Committee also administers the Companys stock option and
incentive plans, including our 2007 Long-Term Incentive
Compensation Plan and our 2007 Executive Equity Incentive Plan.
All members of the Compensation Committee are independent within
the meaning of the rules and regulations of the SEC, the
requirements of the NASDAQ Stock
Market
®
and our Corporate Governance Guidelines. The Compensation
Committees charter can be found on the Companys
website at
www.fxree.com
.
6
Overview
of Compensation Program
Because we are a recently formed company, we do not have a
definitive compensation program in place. We expect that a key
element of our philosophy on senior executive compensation will
be to ensure that all elements of our compensation program work
together to attract, motivate and retain the executive,
managerial and professional talent needed to achieve our
strategy, goals and objectives. Our company and the compensation
committee are committed to the principles inherent in paying for
performance and we expect that we will structure the
compensation program to deliver rewards for exemplary
performance and to withhold rewards and impose other
consequences in the absence of such performance.
Components
of Compensation for Named Executive Officers
The key elements of annual executive compensation are base
salary, other than with respect to Mr. Sillerman, annual
performance incentive awards and long-term incentive awards. In
considering appropriate levels of annual and long-term incentive
compensation, we take into account the extent to which existing
incentives, including each executives existing stock
ownership in us and the existence or lack of any vesting
provisions or restrictions on resale with respect thereto,
provide a sufficient degree of economic incentive to continue
our success.
Base
Salary
The compensation committee will annually review the base
salaries of the chief executive officer and other named
executive officers of our company. As described further below,
Mr. Sillerman will not receive any base salary under his
employment agreement. The agreement by Mr. Sillerman to
request no salary is based on his, and the companys,
belief that, based on his involvement in the formation of the
company and his interest in maximizing stockholder value, his
compensation should be tied to generating stockholder returns
through growth in value of our common stock. The salaries of the
named executive officers, other than Mr. Sillerman, were
set to reflect the nature and responsibility of each of their
respective positions and to retain a management group with a
proven track record. We believe that entering into employment
agreements with our most senior executives helps ensure that our
core group of managers will be available to us and our
stockholders on a long-term basis. The employment agreements of
Messrs. Kanavos, Torino, Benson, Nelson and Shier provide
for a base salary that escalates annually by an amount not less
than the greater of five percent or the rate of inflation. The
base salary for each named executive officer may be raised in
excess of this amount upon the recommendation and approval of
the Compensation Committee. None of the named senior executives
are guaranteed a bonus payment under the terms of his employment
agreement. For a detailed description of the employment
agreements see
Employment
Contracts
below.
Annual
Incentives
While we believe that annual incentive compensation motivates
executives to achieve exemplary results, no formal annual
incentive compensation plan for our named executive officers has
been adopted to date. In large part, this decision reflects the
view, jointly held by management and the members of the
compensation committee, that during the formative phase in our
development, we should approach compensation cautiously.
Executive
Equity Incentive Plan
Our 2007 Executive Equity Incentive Plan was adopted by our
board of directors in December 2007 and will be presented to our
stockholders for approval at our 2008 annual meeting of
stockholders.
Administration.
Administration of the
Executive Equity Plan is carried out by the Compensation
Committee of the board of directors.
Maximum Shares and Award Limits.
Under the
Executive Equity Plan, the maximum number of shares of common
stock that may be subject to stock options, stock awards,
deferred shares or performance shares is 12.5 million.
These limitations, and the terms of outstanding awards, will be
adjusted without the approval of our stockholders as the
Compensation Committee determines is appropriate in the event of
a stock dividend, stock split, reclassification of stock or
similar events.
7
Eligibility.
Our officers and employees,
directors and other persons that provide consulting services to
us and our subsidiaries are eligible to participate in the
Executive Equity Plan.
Stock Options.
The Executive Equity Plan
provides for the grant of options that are not intended to
qualify as incentive stock options under Section 422 of the
Internal Revenue Code of 1986, as amended. An options
exercise price cannot be less than the common stocks fair
market value on the date the option is granted, and in the event
a participant is deemed to be a 10% owner of our company or one
of our subsidiaries, the exercise price of an incentive stock
option cannot be less than 110% of the common stocks fair
market value on the date the option is granted. The Executive
Equity Plan prohibits repricing of an outstanding option, and
therefore, the Compensation Committee may not, without the
consent of the stockholders, lower the exercise price of an
outstanding option, except in the case of adjustments resulting
from stock dividends, stock splits, reclassifications of stock
or similar events. The maximum period in which an option may be
exercised will be fixed by the Compensation Committee but cannot
exceed ten years, and in the event a participant is deemed to be
a 10% owner of our company or one of our corporate subsidiaries,
the maximum period for an incentive stock option granted to such
participant cannot exceed five years. Options generally will be
nontransferable except in the event of the participants
death but the Compensation Committee may allow the transfer of
non-qualified stock options through a gift or domestic relations
order to the participants family members.
Unless provided otherwise in a participants stock option
agreement and subject to the maximum exercise period for the
option, an option generally will cease to be exercisable upon
the earlier of three months following the participants
termination of service with us or certain of our affiliates or
the expiration date under the terms of the participants
stock option agreement, provided, however that the right to
exercise an option will expire immediately upon termination for
cause or a voluntary termination any time after an
event that would be grounds for termination for cause. Upon
death or disability, the option exercise period is extended to
the earlier of one year from the participants termination
of service or the expiration date under the terms of the
participants stock option agreement.
Amendment and Termination.
No awards may be
granted under the Executive Equity Plan after the tenth
anniversary of its adoption by our stockholders. The board of
directors may amend or terminate the Executive Equity Plan at
any time, but no amendment will become effective without the
approval of our stockholders if it increases the aggregate
number of shares of common stock that may be issued under the
Executive Equity Plan, changes the class of employees eligible
to receive incentive stock options or stockholder approval is
required by any applicable law, regulation or rule, including
any rule of any applicable securities exchange or quotation
system. No amendment or termination of the Executive Equity Plan
will affect a participants rights under outstanding awards
without the participants consent.
In accordance with the terms of their employment agreements, we
have issued to Messrs. Sillerman, Kanavos, Benson, Torino
and Nelson, 6,000,000, 750,000, 400,000, 400,000 and 400,000
stock options, respectively. Under the terms of the employment
agreements with Messrs. Kanavos, Torino and Nelson, these
stock options vest ratably over a five year period commencing
with effectiveness of the relevant employment agreement, and
have a strike price of $20.00 per share. Under the terms of the
employment agreements with Messrs. Sillerman and Benson, as
amended, these stock options vest ratably over a five year
period commencing upon acceptance of their positions as
executive officers of the Company. In accordance with the terms
of Mr. Shiers employment agreement, we have issued to
him 1,500,000 stock options at a strike price of $10.00 per
share. The options vest ratably over a two year period, with all
such options becoming exercisable at the end of two years.
Equity
Incentive Plan
Our 2007 Long-Term Incentive Compensation Plan was adopted by
our board of directors in December 2007 and will be presented to
our stockholders for approval at our 2008 annual meeting of
stockholders.
Administration.
Administration of the 2007
Plan is carried out by the Compensation Committee of the board
of directors.
Maximum Shares and Award Limits.
Under the
2007 Plan, the maximum number of shares of common stock that may
be subject to stock options, stock awards, deferred shares or
performance shares is 3 million. No one participant may
8
receive awards for more than 1 million shares of common
stock under the plan. These limitations, and the terms of
outstanding awards, will be adjusted without the approval of our
stockholders as the Compensation Committee determines is
appropriate in the event of a stock dividend, stock split,
reclassification of stock or similar events.
Eligibility.
Our officers and employees,
directors and other persons that provide consulting services to
us and our subsidiaries are eligible to participate in the 2007
Plan.
Stock Options.
The 2007 Plan provides for the
grant of both options intended to qualify as incentive stock
options under Section 422 of the Internal Revenue Code of
1986, as amended, and options that are not intended to so
qualify. Options intended to qualify as incentive stock options
may be granted only to persons who are our employees or are
employees of our subsidiaries which are treated as corporations
for federal income tax purposes. No participant may be granted
incentive stock options that are exercisable for the first time
in any calendar year for common stock having a total fair market
value (determined as of the option grant) in excess of $100,000.
An options exercise price cannot be less than the common
stocks fair market value on the date the option is
granted, and in the event a participant is deemed to be a 10%
owner of our company or one of our subsidiaries, the exercise
price of an incentive stock option cannot be less than 110% of
the common stocks fair market value on the date the option
is granted. The 2007 Plan prohibits repricing of an outstanding
option, and therefore, the Compensation Committee may not,
without the consent of the stockholders, lower the exercise
price of an outstanding option, except in the case of
adjustments resulting from stock dividends, stock splits,
reclassifications of stock or similar events. The maximum period
in which an option may be exercised will be fixed by the
Compensation Committee but cannot exceed ten years, and in the
event a participant is deemed to be a 10% owner of our company
or one of our corporate subsidiaries, the maximum period for an
incentive stock option granted to such participant cannot exceed
five years. Options generally will be nontransferable except in
the event of the participants death but the Compensation
Committee may allow the transfer of non-qualified stock options
through a gift or domestic relations order to the
participants family members.
Unless provided otherwise in a participants stock option
agreement and subject to the maximum exercise period for the
option, an option generally will cease to be exercisable upon
the earlier of three months following the participants
termination of service with us or certain of our affiliates or
the expiration date under the terms of the participants
stock option agreement, provided, however that the right to
exercise an option will expire immediately upon termination for
cause or a voluntary termination any time after an
event that would be grounds for termination for cause. Upon
death or disability, the option exercise period is extended to
the earlier of one year from the participants termination
of service or the expiration date under the terms of the
participants stock option agreement.
Stock Awards and Performance Based
Compensation.
The Compensation Committee also
will select the participants who are granted restricted common
stock awards and, consistent with the terms of the 2007 Plan,
will establish the terms of each stock award. A restricted
common stock award may be subject to payment by the participant
of a purchase price for shares of common stock subject to the
award, and a stock award may be subject to vesting requirements,
performance objectives or transfer restrictions, if so provided
by the Compensation Committee. In the case of a performance
objective for an award intended to qualify as performance
based compensation under Section 162(m) of the
Internal Revenue Code, the objectives are limited to specified
levels of and increases in our or a business units return
on equity; total earnings; earnings per share; earnings growth;
return on capital; return on assets; economic value added;
earnings before interest and taxes; earnings before interest,
taxes, depreciation and amortization; sales growth; gross margin
return on investment; increase in the fair market value of the
shares; share price (including but not limited to growth
measures and total stockholder return); net operating profit;
cash flow (including, but not limited to, operating cash flow
and free cash flow); cash flow return on investments (which
equals net cash flow divided by total capital); funds from
operations; internal rate of return; increase in net present
value or expense targets. Transfer of the shares of common stock
subject to a stock award normally will be restricted prior to
vesting.
Deferred Shares.
The 2007 Plan also authorizes
the grant of deferred shares, i.e., the right to receive a
future delivery of shares of common stock, if certain conditions
are met. The Compensation Committee will select the participants
who are granted awards of deferred shares and will establish the
terms of each grant. The conditions established for earning the
grant of deferred shares may include, for example, a requirement
that certain performance objectives, such as those described
above, be achieved.
9
Performance Shares and Performance Units.
The
2007 Plan also permits the grant of performance shares and
performance units to participants selected by the Compensation
Committee. A performance share is an award designated in a
specified number of shares of common stock that is payable in
whole or in part, if and to the extent certain performance
objectives are achieved. The performance objectives will be
prescribed by the Compensation Committee for grants intended to
qualify as performance based compensation under
Section 162(m) and will be stated with reference to the
performance objectives described above.
Amendment and Termination.
No awards may be
granted under the 2007 Plan after the tenth anniversary of its
adoption by our stockholders. The board of directors may amend
or terminate the 2007 Plan at any time, but no amendment will
become effective without the approval of our stockholders if it
increases the aggregate number of shares of common stock that
may be issued under the 2007 Plan, changes the class of
employees eligible to receive incentive stock options or
stockholder approval is required by any applicable law,
regulation or rule, including any rule of any applicable
securities exchange or quotation system. No amendment or
termination of the 2007 Plan will affect a participants
rights under outstanding awards without the participants
consent.
Employment
Contracts
We have entered into employment agreements with
Messrs. Sillerman, Kanavos, Shier, Benson, Torino and
Nelson. Our compensation committee retained an independent
compensation consultant to provide independent review and
analysis of all senior executive compensation packages and plans
prior to approving the proposed employment agreements. We
entered into these agreements in recognition of the need to
provide certainty to both us and the individuals with respect to
their continued and active participation in our growth. The
employment agreement for each of Messrs. Sillerman,
Kanavos, Shier, Benson, Torino and Nelson is for a term of five
years. The provisions governing the commencement of the
employment terms for Messrs. Sillerman and Benson, as
currently contemplated, are described below. The employment
agreements include a non-competition agreement between the
executive officer and us which will be operative during the
term. Upon a change in control, the executive
officer will be able to terminate his employment and, upon doing
so, will no longer be subject to the non-competition provisions.
Mr. Sillerman has elected not to receive an annual base
salary under the terms of his employment agreement. The decision
by Mr. Sillerman to request no salary was based on his, and
the companys, belief that, based on his involvement in the
formation of the company and his interest in maximizing
stockholder value, his compensation should be tied to generating
stockholder returns through growth in value of our common stock.
The employment agreements for Messrs. Kanavos, Shier,
Benson, Torino and Nelson are expected to provide for initial
annual base salaries of $600,000 for Mr. Kanavos,
$2,000,000 for Mr. Shier, $525,000 for Mr. Benson,
$450,000 for Mr. Torino and $525,000 for Mr. Nelson,
increased annually by the greater of five percent or the rate of
inflation.
Under the terms of Mr. Shiers employment agreement,
Mr. Shier purchased 500,000 shares of our common stock
at a price of $5.14 per share on January 3, 2008 for an
aggregate purchase price of $2,570,000. Mr. Shier will not
be able to sell or otherwise transfer these shares until the
second anniversary of the date of purchase, except for estate
planning purposes subject to our advance written consent. On the
second anniversary of the date of purchase or as soon thereafter
as we are eligible to use a short-form registration statement on
Form S-3,
we will register these shares for resale with the Securities and
Exchange Commission.
Each of our executive officers received an initial grant of
stock options as more fully described above under
Executive Equity Incentive Plan
.
In addition, Mr. Shiers employment agreement also
entitles Mr. Shier to receive options to purchase
200,000 shares per year over the next five years, in each
case with strike prices equal to the fair market value when the
grants occur. Such options vest on the date of grant.
Mr. Sillermans employment agreement provides that if
Mr. Sillermans employment is terminated by us without
cause, or if there is a constructive
termination without cause, as such terms are defined in
the employment agreements, his non-compete shall cease to be
effective on the later of such termination or three years from
the effective date of the agreement. Mr. Sillermans
employment agreement specifies that he is required to commit not
less than 50% of his business time to our company, with the
balance of his business time to be governed by his employment
agreement with CKX or 19X, as the case may be.
10
Mr. Sillerman is currently party to an employment agreement
with CKX. Mr. Sillermans employment agreement with us
will become effective upon the earlier of (i) the date on
which the acquisition of CKX by 19X is consummated, and
(ii) the date on which the merger agreement between CKX and
19X is terminated. From January 10, 2008 until such time as
Mr. Sillermans employment agreement becomes effective
he will continue as a full-time employee of CKX and will, in
furtherance of CKXs obligations under the shared services
agreement, accept the position of Chief Executive Officer of our
company. Upon effectiveness of his employment agreement,
Mr. Sillermans employment agreement with CKX will be
revised to allow him to provide up to 50% of his work time on
matters pertaining to us. Similarly, his employment agreement
with us will allow him to provide up to 50% of his work time on
matters pertaining to CKX
and/or
19X.
Mr. Kanavos employment agreement permits him to spend
up to one-third of his work time on matters pertaining to Flag
Luxury Properties.
Mr. Benson is currently party to an employment agreement
with CKX. Mr. Bensons employment agreement with us
will become effective upon the earliest of (i) the date on
which the acquisition of CKX by 19X is consummated,
(ii) the date on which CKX hires a suitable replacement to
fill the role of Chief Financial Officer, the search for which
would only commence upon termination of the merger agreement
between CKX and 19X, and (iii) that date that is six months
following termination of the merger agreement between CKX and
19X. From the date of the CKX Distribution until such time as
Mr. Bensons employment agreement becomes effective
and he resigns from his position at CKX, Mr. Benson will
continue as a full-time employee of CKX and will, in furtherance
of CKXs obligations under the shared services agreement,
serve as Chief Financial Officer of our company. Upon
effectiveness of his employment agreement, Mr. Benson will
become a full-time employee of us, provided that his employment
agreement will permit him to spend up to one-third of his work
time on 19X matters.
Mr. Torinos employment agreement permits him to spend
up to one-third of his work time on matters unrelated to our
company, provided such matters are not competitive with our
business or are otherwise approved by our board.
Mr. Nelsons employment agreement permits him to spend
up to one-third of his work time on matters pertaining to Flag
Luxury Properties.
Shared
Services Agreement
In addition to entering into the employment agreements described
above, we are party to a shared services agreement with CKX,
pursuant to which employees of CKX, including members of senior
management, provide services for us, and certain of our
employees, including members of senior management, provide
services for CKX. The services to be provided pursuant to the
shared services agreement are expected to include management,
legal, accounting and administrative. For more detailed
information about the terms of the shared services agreement,
please see
Item 13 Certain Relationships, Related
Transactions and Director Independence Shared
Services Agreement
.
Compensation
Committee Interlocks and Insider Participation
No member of our Compensation Committee was at any time during
the past fiscal year an officer or employee of us, was formerly
an officer of us or any of our subsidiaries or has an immediate
family member that was an officer or employee of us or had any
relationship requiring disclosure under
Item 13. Certain
Relationships, Related Transactions, and Director
Independence.
During the last fiscal year, none of our executive officers
served as:
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a member of the compensation committee (or other committee of
the board of directors performing equivalent functions or, in
the absence of any such committee, the entire board of
directors) or another entity, one of whose executive officers
served on our compensation committee;
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a director of another entity, one of whose executive officers
served on our compensation committee; and
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a member of the compensation committee (or other committee of
the board of directors performing equivalent functions or, in
the absence of any such committee, the entire board of
directors) of another entity, one of whose executive officers
served as a director of us.
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11
COMPENSATION
COMMITTEE REPORT
The compensation committee has reviewed and discussed with
management the Compensation Discussion and Analysis
set forth elsewhere in this Amended Report. Based on such
review, the related discussions and such other matters deemed
relevant and appropriate by the compensation committee, the
compensation committee has recommended to the board of directors
that the Compensation Discussion and Analysis be
included in this Amended Report. This report is provided by the
following independent directors, who comprise the committee:
David M. Ledy (chairman)
Harvey Silverman
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ITEM 12.
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SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
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Securities
Authorized for Issuance under Equity Compensation
Plans
The table below shows information with respect to our equity
compensation plans and individual compensation arrangements as
of December 31, 2007.
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(a)
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(b)
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Number of
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Weighted-
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Securities to
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Average
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be
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Exercise
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(c)
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Issued Upon
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Price of
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Number of
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Exercise of
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Outstanding
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Securities
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Outstanding
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Options,
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Remaining
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Options, Warrants
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Warrants and
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Available For
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Plan Category
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and Rights
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Rights
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Future Issuance
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(#)
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($)
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(#)
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Equity compensation plans approved by security holders
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Equity compensation plans not approved by security holders(1)
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9,450,000
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18.41
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6,050,000
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(1)
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We maintain the 2007 Executive Equity Incentive Plan and the
2007 Long-Term Incentive Compensation Plan. All outstanding
options, warrants and other rights were issued under the 2007
Executive Equity Incentive Plan. See Note 12 to our audited
Consolidated Financial Statements included in the Original
Report. The Company intends to submit these Plans for
stockholder approval at its 2008 Annual Meeting of Stockholders.
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For a description of our 2007 Executive Equity Incentive Plan
and our 2007 Long-Term Incentive Compensation Plan, see
Item 11. Executive Compensation
Components of Compensation for Named Executive
Officers
.
Security
Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information regarding
beneficial ownership of shares of our Common Stock as of
April 25, 2008 by the following individuals or groups:
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each person or entity known by us to beneficially own more than
5% of our Common Stock;
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each of our named executive officers;
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each of our current directors and director nominees; and
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all of our directors, director nominees and executive officers
named as a group.
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Beneficial ownership is determined in accordance with the rules
of the SEC and generally includes voting or investment power
with respect to the securities. Unless otherwise noted, each
beneficial owner has sole voting and investing power over the
shares shown as beneficially owned except to the extent
authority is shared by spouses under applicable law.
12
As of April 25, 2008, we had outstanding
44,692,809 shares of Common Stock.
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Amount and
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Nature of
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Beneficial
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Name and Address(1)
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Ownership
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Percent of Class
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Beneficial Owners of More Than 5% of Our Common Stock:
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Robert F.X. Sillerman(2)
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14,844,904
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33.2
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Paul Kanavos(3)
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5,763,108
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12.9
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Brett Torino(4)
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5,733,108
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12.8
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The Huff Alternative Fund, L.P.(5)
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3,952,442
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8.8
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Directors, Director
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Nominees and Named
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Executive Officers:
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Barry Shier
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500,000
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1.1
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Thomas P. Benson
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417,234
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*
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David M. Ledy
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28,024
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*
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Carl D. Harnick
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7,550
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*
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Harvey Silverman(6)
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1,577,016
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3.5
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Mitchell J. Nelson
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165,000
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*
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All directors, director nominees and executive officers as a
group (9 persons)
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29,035,944
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65.0
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*
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Less than 1%
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(1)
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Unless otherwise indicated, the address of each identified
beneficial owner is:
c/o FX
Real Estate and Entertainment Inc., 650 Madison Avenue, New
York, New York 10022.
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(2)
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Includes: (i) 13,777,987 shares of common stock owned
of record by Mr. Sillerman; (ii) 300,000 shares
of common stock owned of record by Laura Baudo Sillerman,
Mr. Sillermans spouse; and
(iii) 766,917 shares of common stock owned of record
by Sillerman Capital Holdings, L.P., a limited partnership
controlled by Mr. Sillerman through a trust for the benefit
of Mr. Sillermans descendants. Mr. Sillerman is
our Chairman and Chief Executive Officer.
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(3)
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Includes: (i) 500,000 shares of common stock owned of
record by Dayssi Olarte de Kanavos 2008 GRAT;
(ii) 500,000 shares of common stock owned of record by
Paul C. Kanavos 2008 GRAT; (iii) 4,408,804 shares of
common stock owned of record by Mr. Kanavos and his spouse
Dayssi Kanavos, as joint tenants and
(iv) 354,254 shares of common stock owned of record by
Paul C. Kanavos. Mr. Kanavos is our President and serves on
our board of directors.
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(4)
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Includes: (i) 176,238 shares of common stock owned of
record by Brett Torino; and (ii) 5,556,870 shares of
common stock owned of record by ONIROT Living Trust.
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(5)
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Includes 88,596 shares of common stock owned of record by
an affiliated limited partnership of The Huff Alternative Fund,
L.P. William R. Huff possesses the sole power to vote and
dispose of all the shares of our common stock held by the two
Huff entities, subject to certain internal compliance
procedures. The address of the Huff entities is 67 Park Place,
Morristown, New Jersey 07960.
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(6)
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Includes: (i) 1,384,119 shares of common stock owned
of record by Mr. Silverman and
(ii) 192,897 shares of common stock owned of record by
Silverman Partners LP, in which Mr. Silverman is the sole
general partner.
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ITEM 13.
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CERTAIN
RELATIONSHIPS, RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
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There are a number of conflicts of interest of which
stockholders should be aware regarding our ownership and
operations. Set forth below a list of related parties with whom
we have engaged in one or more transactions as well as a summary
of each transaction involving such related parties.
13
Related
Parties
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Robert F.X. Sillerman, our Chairman and Chief Executive Officer,
(i) is the Chairman and Chief Executive Officer of CKX,
Inc., (ii) owns approximately 31% of the outstanding common
stock of CKX, (iii) is a director, executive officer and
principal stockholder of 19X, which has entered into an
agreement to acquire CKX, (iv) owns approximately 29.3% of
the outstanding equity of Flag Luxury Properties, and
(v) has personally guaranteed a $23 million loan to
our company from an affiliate of Credit Suisse.
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Paul Kanavos, our President, (i) is the Chairman and Chief
Executive Officer of Flag Luxury Properties, and (ii) owns
approximately 29.3% of the outstanding equity of Flag Luxury
Properties.
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Flag Luxury Properties holds a $45 million priority
preferred distribution as more fully described below.
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CKX, Inc. (i) is party to a shared services agreement with
us as more fully described below, (ii) is party to license
agreements with us, through its subsidiaries, as more fully
described below, and (iii) has loaned us $6.0 million
under a $7.0 million line of credit, as more fully
described below.
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We have entered into an option agreement with 19X, Inc., a
company owned in part by Mr. Sillerman which, if and when
effective, would give us an option to acquire an 85% interest in
the Elvis Presley business currently owned and operated by CKX,
Inc. through its Elvis Presley Enterprises subsidiaries. Because
19X will only own those rights upon consummation of its pending
acquisition of CKX, the effectiveness of the Option Agreement is
conditioned upon the closing of 19Xs acquisition of CKX.
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Flag
Luxury Properties Contribution and Sale of Assets to FX Luxury
Realty
In May 2007, Flag Luxury Properties contributed all of its
direct and indirect membership interests in the following
subsidiaries, which directly own the Park Central site, to FX
Luxury Realty in exchange for membership interests therein: BP
Parent, LLC, a Delaware limited liability company; Metroflag BP,
LLC, a Nevada limited liability company; Metroflag Cable, LLC, a
Nevada limited liability company; and Metroflag Management, LLC,
a Nevada limited liability company.
On June 1, 2007, Flag Leisure Group, LLC, the managing
member of Flag Luxury Properties, sold to FX Luxury Realty all
of the membership interests in RH1, LLC, a Nevada limited
liability company which is the record and beneficial owner of
418,294 shares of common stock of Riviera Holdings
Corporation for consideration of approximately
$12.5 million, paid in cash.
Also on June 1, 2007, Flag Luxury Properties sold to FX
Luxury Realty all of the membership interests in Flag Luxury
Riv, which is the record and beneficial owner of
418,294 shares of common stock of Riviera Holdings
Corporation for consideration of approximately
$9.1 million, $8.1 million of which was paid in cash,
with $1 million paid in the form of a note.
On March 23, 2007, Robert F.X. Sillerman loaned Flag Luxury
Properties, which in turn loaned its subsidiary Flag Luxury Riv,
$1.15 million in connection with the acquisition by Flag
Luxury Riv of a 50% beneficial ownership interest in an option
to acquire 1,147,550 shares of Riviera Holdings
Corporation. On June 1, 2007, FX Luxury Realty, which
succeeded to the debt upon acquiring Flag Luxury Riv, repaid the
loan using a portion of the proceeds from a $23 million
loan from an affiliate of Credit Suisse which is described below.
On May 31, 2007, Flag Luxury Properties made a payment in
the amount of $7.5 million on behalf of FX Luxury Realty in
connection with the buyout of Leviev Boymelgreen of Nevada, an
affiliate of Africa-Israel Investments Ltd., the former 50%
owner of entities that own the Park Central site. On
June 1, 2007, FX Luxury Realty issued a promissory note to
Flag Luxury Properties evidencing the amount owed. The note was
repaid on July 9, 2007 from the proceeds of CKXs
investment in FX Luxury Realty and is no longer outstanding.
CKX
Investment, Transfer to Distribution Trusts and
Reorganization
On June 1, 2007, CKX invested $100 million in cash in
exchange for 50% of the common membership interests of FX Luxury
Realty.
14
On June 18, 2007, CKX declared a dividend consisting of 25%
of our shares of common stock. Prior to declaring the dividend,
CKX formed two trusts:
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CKX FXLR Stockholder Distribution Trust I, or Distribution
Trust I, formed to hold the dividend property for the
benefit of certain named CKX executive officers who are
stockholders of CKX pending consummation of the CKX
Distribution and
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CKX FXLR Stockholder Distribution Trust II, or Distribution
Trust II, formed to hold the FX Luxury Realty equity
interests for the benefit of CKX stockholders as of the record
date of the CKX Distribution pending consummation of the CKX
Distribution.
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Upon declaration of the dividend, CKX made the following
irrevocable assignments and transfers:
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CKX irrevocably transferred and assigned a 9.5% common
membership interest in FX Luxury Realty to Distribution
Trust I;
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CKX contributed a 15.5% common membership interest in FX Luxury
Realty to FX Real Estate and Entertainment in exchange for
shares of FX Real Estate and Entertainment as step one in the
previously disclosed plan to reorganize FX Luxury Realty into a
Subchapter C corporation prior to the CKX Distribution of its
equity interests to CKX stockholders; and
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CKX irrevocably transferred and assigned the FX Real Estate and
Entertainment shares to Distribution Trust II.
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Following these transfers, CKX owned 25% of the outstanding
common membership interests of FX Luxury Realty, Distribution
Trust I owned 9.5% of the common membership interests of FX
Luxury Realty, we owned 15.5% of FX Luxury Realty and Flag
Luxury Properties owned the remaining outstanding 50%. Following
these transfers, we were wholly-owned by Distribution
Trust II. As a result of the distribution to the trusts,
CKX no longer had any interest in or control over the equity
transferred to the Distribution Trust I and Distribution
Trust II.
On September 26, 2007, CKX, Distribution Trust I and
Flag Luxury Properties, LLC exchanged all of their common
membership interests in FX Luxury Realty for shares of our
common stock.
Immediately following the reorganization, also on
September 26, 2007, CKX acquired an additional
$1.5 million of our common stock, and Flag Luxury
Properties acquired an additional $0.5 million of our
common stock, the pricing for which was based on the same
valuation used at the time of CKXs initial investment in
FX Luxury Realty in June 2007. As a result of the reorganization
described above and the purchase of the additional shares, we
were owned 25.5% by CKX, 25.75% in the aggregate by the two
Distribution Trusts and 49.75% by Flag Luxury Properties.
On September 27, 2007, CKX declared a dividend consisting
of 23.5% of our outstanding shares of common stock. Prior to
declaring the dividend, CKX formed the CKX FXLR Stockholder
Distribution Trust III, formed for the benefit of CKX
stockholders as of the record date. Upon declaration of the
dividend, CKX irrevocably assigned shares of our common stock
representing 23.5% of the issued and outstanding shares of our
common stock to the Distribution Trust III. As a result of
the distribution to the trust, CKX no longer had any interest in
or control over the equity transferred to the Distribution
Trust III.
Flag
Distribution
On November 30, 2007, Flag Luxury Properties distributed
all of its shares of our common stock, representing 49.75% of
the then outstanding shares of our common stock, to its members,
including Messrs. Sillerman and Kanavos, and certain of its
employees.
Preferred
Distribution
Flag Luxury Properties holds a $45 million priority
preferred distribution right in FX Luxury Realty. This right
entitles Flag Luxury Properties to receive an aggregate amount
of $45 million prior to any distributions of cash by FX
Luxury Realty from the proceeds of certain predefined capital
transactions, including the payment of $30 million of the
$45 million preferred distribution from the proceeds of the
rights offering and sales under the related
15
investment agreements described elsewhere herein. From and after
November 1, 2007, Flag Luxury Properties is entitled to an
annual return on the preferred priority distribution equal to
the Citibank N.A. prime rate as reported from time to time in
the Wall Street Journal. The prime rate at September 30,
2007 was 7.75%. Until the preferred distribution is paid in
full, we are required to use the proceeds from certain
predefined capital transactions to pay the amount then owed to
Flag Luxury Properties under such priority preferred
distribution right. This right carries no voting or other
rights, other than the right to receive the priority preferred
distribution. Robert F.X. Sillerman and Paul Kanavos each own,
directly and indirectly, an approximate 29.3% interest in Flag
Luxury Properties and each will be entitled to receive his pro
rata participation of the $45 million priority distribution
when paid by FX Luxury Realty. We intend to use certain proceeds
from the rights offering and sales under the related investment
agreements described elsewhere herein, to pay $30 million
of the $45.0 million preferred priority distribution.
License
Agreements
Simultaneous with the CKX investment in FX Luxury Realty, FX
Luxury Realty entered into a worldwide license agreement with
Elvis Presley Enterprises, Inc., a subsidiary of CKX, granting
FX Luxury Realty the exclusive right to utilize Elvis
Presley-related intellectual property in connection with the
development, ownership and operation of Elvis Presley-themed
hotels, casinos and certain other real estate-based projects and
attractions around the world.
FX Luxury Realty also entered into a worldwide license agreement
with Muhammad Ali Enterprises, LLC, also a subsidiary of CKX,
granting FX Luxury Realty the right to utilize Muhammad
Ali-related intellectual property in connection with Muhammad
Ali-themed hotels and certain other real estate-based projects
and attractions. The terms of the License Agreements are
described more fully under the heading
Item 1
Business Elvis Presley License Agreement and
Item 1 Business Muhammad Ali License
Agreement.
Conditional
Amendment
We have entered into an agreement with 19X to amend the License
Agreement between our Company and EPE, which amendment shall
only become effective upon the closing of 19Xs acquisition
of CKX.
If and when effective, the amendment to the License Agreement
will provide that, if, by the date that is
7
1
/
2
years
following the closing of 19Xs acquisition of CKX, EPE has
not achieved certain financial projections, we will be entitled
to a reduction of $50 million against 85% of the payment
amounts due under the License Agreement, with such reduction to
occur ratably over the ensuing three year period provided,
however, that if we have failed in our obligations to build any
hotel to which we had previously committed under the definitive
Graceland master redevelopment plan, then this reduction shall
not apply.
The amendment to the License Agreement also provides that we may
lose our right to construct hotel(s) as part of the Graceland
master development plan (i) in the event we approve a
master plan (as contemplated under the Option Agreement with
19X) but subsequently fail to deliver a notice within ten
(10) days of such approval of our intent to proceed with
the hotels contemplated in the master plan or, (ii) in the
alternative, if we fail to deliver our notice of intent to
proceed in accordance with the definitive master plan within
ninety days of presentation of a master plan that 19X has agreed
to undertake but which we have not approved.
Shared
Services Agreement
We are party to a shared services agreement with CKX, pursuant
to which employees of CKX, including members of senior
management, provide services for us, and certain of our
employees, including members of senior management, provide
services for CKX. The services to be provided pursuant to the
shared services agreement are expected to include management,
legal, accounting and administrative.
Payments under the agreements are made on a quarterly basis and
will be determined taking into account a number of factors,
including but not limited to, the overall type and volume of
services provided, the individuals involved, the amount of time
spent by such individuals and their current compensation rate
with the company with which they are employed. Each quarter,
representatives of the parties will meet to (i) determine
the net payment due from one party to the other for provided
services performed by the parties during the prior calendar
quarter, and
16
(ii) prepare a report in reasonable detail with respect to
the provided services so performed, including the value of such
services and the net payment due. The parties shall use their
reasonable, good-faith efforts to determine the net payments due
in accordance with the factors described in above.
Each party shall promptly present the report prepared as
described above to the independent members of its board of
directors or a duly authorized committee of independent
directors for their review as promptly as practicable. If the
independent directors or committee for either party raise
questions or issues with respect to the report, the parties
shall cause their duly authorized representatives to meet
promptly to address such questions or issues in good faith and,
if appropriate, prepare a revised report. If the report is
approved by the independent directors or committee of each
party, then the net payment due as shown in the report shall be
promptly paid.
The term of the agreement runs until December 31, 2010,
provided, however
, that the term may be extended or
earlier terminated by the mutual written agreement of the
parties, or may be earlier terminated upon 90 days written
notice by either party in the event that a majority of the
independent members of such partys board of directors
determine that the terms
and/or
provisions of this agreement are not in all material respects
fair and consistent with the standards reasonably expected to
apply in arms-length agreements between affiliated parties;
provided further, however
, that in any event either party
may terminate the agreement in its sole discretion upon
180 days prior written notice to the other party.
Because the shared services agreement with CKX constitutes an
agreement with a related party, the agreement was reviewed and
approved by the independent members of our board of directors.
In addition, the agreement was reviewed and approved by a
special committee of independent members of the board of
directors of CKX formed to evaluate and approve certain related
party transactions.
Sillerman
Investment Agreement
We have entered into an investment agreement with Robert F.X.
Sillerman, our Chairman and Chief Executive Officer, pursuant to
which Mr. Sillerman has agreed to subscribe for his full
pro rata amount of shares in this rights offering (representing
3,037,265 shares), as well as to purchase up to 50% of the
shares that remain unsold in the rights offering after
Huffs initial $15 million investment (pursuant to the
Huff investment agreement described elsewhere herein) at the
same subscription price per share being offered to our
stockholders. Mr. Sillerman will not receive any
consideration for entering into his investment agreement. On
March 12, 2008, Mr. Sillerman subscribed and purchased
all 3,037,265 shares underlying his rights.
Mr. Sillerman is expected to purchase 2,309,556 shares
in fulfillment of the investment agreement no later than
May 13, 2008.
Because Mr. Sillerman, is our Chairman and Chief Executive
Officer, the investment agreement with Mr. Sillerman is
deemed an affiliated transaction and therefore required the
review and oversight of a special committee of our independent
directors. A special committee comprised of independent
directors Messrs. David M. Ledy and Harvey Silverman was
established to review and oversee the transaction. The special
committee engaged independent legal counsel to assist in its
review and oversight of the transaction. Our board of directors,
acting upon the unanimous recommendation of the special
committee, has (except for an abstention by Mr. Sillerman)
unanimously approved the transaction.
Conditional
Option Agreement with 19X
We have entered into an Option Agreement with 19X, Inc. pursuant
to which, in consideration for annual option payments as
described elsewhere herein, we will have the right to acquire an
85% interest in the Elvis Presley business currently owned and
operated by CKX, Inc. through its Elvis Presley Enterprises
subsidiaries at an escalating price over time as set forth
elsewhere herein. Because 19X will only own those rights upon
consummation of its pending acquisition of CKX, the
effectiveness of the Option Agreement is conditioned upon the
closing of 19Xs acquisition of CKX. In the event that the
merger agreement between 19X and CKX is terminated without
consummation or the merger fails to close for any reason, the
Option Agreement with 19X will also terminate and thereafter
have no force and effect. For a more detailed description of the
conditional Option Agreement with 19X please see
Item 1A
Business The
Company Transaction With and Involving Elvis Presley
Enterprises Conditional Option Agreement with
19X.
17
Because our Chairman and Chief Executive Officer, Robert F.X.
Sillerman, is also the Chairman and President of 19X, the Option
Agreement and the Amendment to the Elvis Presley Enterprises
License Agreement with 19X are deemed affiliated transactions
and therefore required the review and oversight of a special
committee of our independent directors. A special committee
comprised of independent directors Messrs. David M. Ledy
and Harvey Silverman was established to review and oversee the
transaction. The special committee engaged The Salter Group to
serve as its independent financial advisor in connection with
its review of the financial terms of the Option Agreement and
engaged independent legal counsel to assist in its review and
oversight of the transactions. Our board of directors, acting
upon the unanimous recommendation of the special committee, has
(except for abstentions by directors affiliated with 19X or EPE)
unanimously approved the transaction.
Stockholder
Lock-Ups
Certain of our affiliates, including Robert F.X. Sillerman,
Brett Torino and Paul C. Kavanos, have entered into
lock-up
agreements which prevent them from selling their shares of our
common stock until the expiration of certain
lock-up
periods for periods of one to three years from the time of the
reorganization transactions. Mr. Sillerman has agreed to
not sell any of the shares that he received as part of the CKX
Distribution for a period of one (1) year.
Messrs. Sillerman, Kanavos and Torino have agreed not to
sell any of the shares they received in connection with the
distribution from Flag Luxury Properties to its members and
certain of its employees for a period of three (3) years.
All other members of Flag Luxury Properties, other than
Messrs. Sillerman, Kanavos and Torino, representing
approximately 6.0% of the outstanding shares of our common
stock, have agreed not to sell their shares for a period of one
year. Once Mr. Sillermans one year lock up with
respect to the shares of our common stock he received as part of
the distribution expires, we expect that 8,771,521 shares
of our common stock will be eligible for sale pursuant to
Rule 144 and once the three year
lock-up
agreements for Messrs. Sillerman, Kanavos and Torino
expire, we expect that 26,470,845 shares of our common
stock will be eligible for sale pursuant to Rule 144. The
distribution of the shares of common stock held by CKX and Flag
Luxury Properties to their respective stockholders and members
are permitted under the terms of the
lock-up
agreements.
Related
Party Indebtedness
On or about June 1, 2007, FX Luxury Realty issued a note to
Flag Luxury Properties in the amount of $1 million as part
of the purchase price for Flag Luxury Riv, which amount
reflected expenses incurred in connection with its proposed
merger with Riviera Holdings Corporation. The note accrued
interest at a rate of 5% per annum from the date of issuance
through December 31, 2007 and a rate of 10% per annum
thereafter. The note was repaid in full and retired on
April 17, 2008.
FX Luxury Realty received a loan in the amount of
$23 million from an affiliate of Credit Suisse pursuant to
a promissory note dated June 1, 2007. The note, as amended
on September 24, 2007 and December 6, 2007, was due
and payable on March 15, 2008. The note bears interest at a
rate equal to the London Inter-Bank Offered Rate plus
250 basis points. On December 31, 2007, the effective
interest rate on this loan was 7.63%. Robert F.X. Sillerman has
provided a personal guarantee for the $23 million loan we
received from Credit Suisse. The proceeds from the loan were
used to used to (i) pay the cash consideration for the
membership interests in RH1 and Flag Luxury Riv described above
in an aggregate principal amount of approximately
$20.6 million, (ii) repay approximately
$1.15 million plus accrued interest to Flag Luxury
Properties for amounts incurred by Flag Luxury Properties on
behalf of Flag Luxury Riv in connection with the acquisition of
the option to acquire 1,147,550 Riviera Holdings Corporation
shares at $23.00 per share and (iii) fund $1.0 million
in interest reserves in a segregated account. On March 12,
2008, Mr. Sillerman exercised his rights received in the
rights offering and purchased 3,037,265 shares of common
stock at a price of $10 per share pursuant to his investment
agreement described elsewhere herein, resulting in gross
proceeds to the Company of approximately $30.4 million. On
March 13, 2008, we used $23 million of the proceeds
from this purchase to repay in full and retire the Riv loan.
On September 26, 2007, we entered into a line of credit
agreement with CKX pursuant to which CKX agreed to loan up to
$7.0 million to us, approximately $6.0 million of
which was drawn down on September 26, 2007 and is evidenced
by a promissory note dated September 26, 2007. We used the
proceeds of the loan, together with proceeds from additional
borrowings, to exercise the option to acquire an additional
573,775 shares of Riviera Holdings Corporations
common stock [AMEX: RIV] at a price of $23 per share. The loan
bears interest at LIBOR plus
18
600 basis points and is payable upon the earlier of
(i) two years and (ii) our consummation of an equity
raise at or above $90.0 million. On December 31, 2007,
LIBOR was 4.86% and the effective interest rate on this loan was
10.86%. Messrs. Sillerman, Kanavos and Torino, severally
but not jointly, have secured the loan by pledging, pro rata, an
aggregate of 972,762 shares of our common stock. The CKX
loan was repaid in full and retired on April 17, 2008 and
all of the shares pledged by Messrs. Sillerman, Kanavos and
Torino to secure the loan were released and returned to them.
Employee
Relationships
Dayssi Olarte de Kanavos, the spouse of our President, Paul
Kanavos, is the Senior Vice President of Marketing and Branding
for Flag Luxury Properties and, from time to time, will provide
marketing and branding-based services for us. We will be
required to reimburse Flag Luxury Properties for the services
provided by Ms. Kanavos in an amount equal to the fair
value of the services as agreed between the parties and approved
by our compensation committee. We are unable to estimate the
extent of the services to be provided by Ms. Kanavos at
this time and therefore cannot estimate the amount that we will
be required to reimburse to Flag Luxury Properties.
Board
Decisions and Certain Conflicts of Interest
Past and future decisions by our board regarding our future
growth, operations and major corporate decisions will be subject
to certain possible conflicts of interest. These conflicts may
have caused, and in the future may cause, our business to be
adversely affected. Nevertheless, our board will be responsible
for making decisions on our behalf. In appropriate
circumstances, we expect to submit transactions with any related
party for approval or negotiation by our independent directors
or a special committee thereof.
Independent
Directors
Rules 4200 and 4350 of The NASDAQ Global Market require
that a majority of our board of directors qualify as
independent no later than January 10, 2009, the
first anniversary of the completion of the CKX Distribution. We
intend to comply with these requirements.
Messrs. Ledy and Silverman, whose biographical information
is included above under the heading
Item 10.
Directors, Executive Officers and Corporate
Governance
, have been appointed to our board of
directors as Independent Directors. In addition to
Mr. Harnick, , whose biographical information is included
above under the heading
Item 10. Directors,
Executive Officers and Corporate Governance
, we expect
that one or more of the current independent directors for CKX
will be appointed to our board of directors upon consummation of
the CKX going private transaction. If the CKX going private
transaction is not completed by the first anniversary of the
date of the CKX Distribution or at all, we will, to the extent
necessary to comply with The NASDAQ Global Markets
independence requirements, identify and appoint other
individuals who qualify as independent to serve as
directors.
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ITEM 14.
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PRINCIPAL
ACCOUNTANT FEES AND SERVICES
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Services
Provided by the Independent Registered Public Accounting Firm
and Fees Paid
The following table sets forth the professional fees rendered by
Ernst & Young LLP for the audit of the Company and its
subsidiaries and its predecessors annual financial
statements for the years ended December 31, 2007 and
December 31, 2006 and other services rendered by
Ernst & Young LLP during those periods:
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2007
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2006
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Audit Fees(1)
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$
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2,454,300
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$
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321,400
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Audit-Related Fees
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Tax Fees(2)
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286,900
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9,200
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All Other Fees
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Total
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$
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2,741,200
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$
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330,600
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19
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(1)
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Audit fees for 2007 include $1,703,300 associated with
accounting consultations, procedures necessary to perform audits
of the historical financial statements of the Metroflag
entities, as the Companys predecessor, assistance with and
review of the Companys registration statement on
Form S-1,
as amended, and relating filings with the SEC, in connection
with the CKX Distribution.
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(2)
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Tax fees related to tax compliance, advice and planning of the
Company and the Metroflag entities.
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Audit
Committee Pre-Approval of Services Provided by the Independent
Registered Public Accounting Firm
The Audit Committee of the board of directors maintains a
pre-approval policy with respect to material audit and non-audit
services to be performed by the Companys independent
registered public accounting firm in order to assure that the
provision of such services does not impair the accountants
independence. Before engaging the independent registered public
accounting firm to render a service, the engagement must be
either specifically approved by the Audit Committee, or entered
into pursuant to the pre-approval policy. Pre-approval authority
may be delegated to one or more members of the Audit Committee.
PART IV
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ITEM 15.
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EXHIBITS,
FINANCIAL STATEMENTS AND SCHEDULES
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(a) List of Documents filed as part of this Report:
(1) Financial Statements:
The following financial
statements were previously included in the Original Report:
The Consolidated Financial Statements for the year ended
December 31, 2007 commence on page 58 of the Original
Report.
(2) Financial Statement Schedule:
The following
financial statement schedules were previously included in the
Original Report:
Schedule II Valuation and Qualifying Accounts
for the period from May 11, 2007 through December 31,
2007.
The Financial Statement Schedule commences on page 86 of
the Original Report.
All other schedules have been omitted as the required
information is inapplicable or the information is presented in
the Consolidated Financial Statements or Notes thereto.
(3) Exhibits
Part IV of the Original Report is hereby amended to add the
exhibits listed below that are required to be filed in
connection with this Amended Report. See the separate
Exhibit Index attached hereto and incorporated herein.
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Exhibit
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|
Number
|
|
Description
|
|
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31
|
.1
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|
Certification of Principal Executive Officer
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|
|
|
|
|
|
31
|
.2
|
|
Certification of Principal Financial Officer
|
20
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities and Exchange Act of 1934, the registrant has duly
caused this Report to be signed on its behalf of the undersigned
thereunto duly authorized.
FX Real Estate and Entertainment Inc.
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By:
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/s/ ROBERT
F.X. SILLERMAN
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April 29, 2008
|
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|
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Robert F.X. Sillerman
Chief Executive Officer and Chairman of the Board
|
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|
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By:
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/s/ THOMAS
P. BENSON
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April 29, 2008
|
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Thomas P. Benson
Chief Financial Officer, Executive Vice President and
Treasurer
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Paul C. Kanavos, Director*
Barry A. Shier, Director*
David M. Ledy, Director*
Harvey Silverman, Director*
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*By:
|
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/s/ THOMAS
P. BENSON
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|
April 29, 2008
|
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Thomas P. Benson, Attorney-in-fact by power of attorney
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21
INDEX TO
EXHIBITS
The documents set forth below are filed herewith.
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|
|
|
|
Exhibit
|
|
|
Number
|
|
Description
|
|
|
31
|
.1
|
|
Certification of Principal Executive Officer
|
|
31
|
.2
|
|
Certification of Principal Financial Officer
|
Grafico Azioni FX Real Est And Ent (MM) (NASDAQ:FXRE)
Storico
Da Ago 2024 a Set 2024
Grafico Azioni FX Real Est And Ent (MM) (NASDAQ:FXRE)
Storico
Da Set 2023 a Set 2024