1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For The Quarterly Period Ended March 31, 1996
Commission file number 0-24710
----------
CD RADIO INC.
- - --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 52-1700207
- - ------------------------------------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
SIXTH FLOOR, 1001 22ND STREET, N.W., WASHINGTON, D.C.
20037
- - --------------------------------------------------------------------------------
(Address of principal executive offices)
(Zip code)
202-296-6192
- - --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
- - --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 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 X No
-------- ---------
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of May 10, 1996
COMMON STOCK, $.001 PAR VALUE 9,416,460
- - ----------------------------------------------------------------------------------------------------------
(Class)
2
CD RADIO INC.
(A DEVELOPMENT STAGE ENTERPRISE)
INDEX
Part I - Financial Information
Page
Consolidated Statements of Operations (unaudited) for the three 1
month periods ended March 31, 1996 and 1995 and for the
period May 17, 1990 (date of inception) to March 31, 1996
Consolidated Balance Sheets (unaudited) as of March 31, 1996 2
and December 31, 1995
Consolidated Statements of Cash Flows (unaudited) for the three 3
month periods ended March 31, 1996 and 1995 and for the
period May 17, 1990 (date of inception) to March 31, 1996
Notes to Consolidated Financial Statements (unaudited) 4
Management's Discussion and Analysis of Results of 5
Operations and Financial Condition
Part II - Other Information 8
Signatures
3
CD RADIO INC. AND SUBSIDIARY
(A Development Stage Enterprise)
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
For the period
Three months ended May 17,1990
----------------------------- (date of inception)
March 31, March 31, to March 31,
1996 1995 1996
---------- --------------- --------------------
Revenue $ - $ - $ -
Expenses:
Legal, consulting and
regulatory fees 227,674 188,918 5,894,547
Other general and administrative 281,681 257,110 6,583,696
Research and development 27,901 26,292 1,826,957
Write-off of investment in
Sky-Highway Radio Corp. - - 2,000,000
----------- --------------- --------------------
Total expenses 537,256 472,320 16,305,200
----------- --------------- --------------------
Other income (expense)
Interest income 25,290 44,123 241,151
Interest expense (4,917) (4,839) (158,099)
----------- --------------- --------------------
20,373 39,284 83,052
----------- --------------- --------------------
Net loss $ (516,883) $ (433,036) $ (16,222,148)
=========== =============== ====================
Net loss per common share $ (0.06) $ (0.05) $ (2.25)
=========== =============== ====================
Weighted average common shares
and common share equivalents
outstanding 9,357,793 9,198,960 7,219,458
=========== =============== ====================
The accompanying notes are an integral part of these consolidated financial
statements
1
4
CD RADIO INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
ASSETS
March 31, December 31,
1996 1995
----------------- -------------------
Current assets:
Cash and cash equivalents $ 1,548,718 $ 1,799,814
Prepaid expense and other 7,128 8,781
----------------- -------------------
Total current assets 1,555,846 1,808,595
----------------- -------------------
Property and equipment, at cost:
Technical equipment 254,200 254,200
Office equipment and other 89,220 89,220
Demonstration equipment 38,664 38,664
----------------- -------------------
382,084 382,084
Less accumulated depreciation (174,970) (160,498)
----------------- -------------------
207,114 221,586
Deposits 303,793 303,793
----------------- -------------------
Total Assets $ 2,066,753 $ 2,333,974
================= ===================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 77,925 $ 46,521
Loan from officer 240,000 -
Other 24,247 20,716
----------------- -------------------
Total current liabilities 342,172 67,237
Loan from officer - 240,000
Deferred rent and other 27,281 35,967
----------------- -------------------
Total liabilities 369,453 343,204
----------------- -------------------
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.001 par value, 10,000,000 shares
authorized; none issued or outstanding - -
Common stock, $0.001 par value; 50,000,000 shares
authorized; 9,396,960 and 9,305,960, shares issued and
outstanding at March 31, 1996 and December 31, 1995,
respectively 9,397 9,306
Additional paid-in capital 18,150,051 18,006,729
Deficit accumulated during the development stage (16,222,148) (15,705,265)
Deferred compensation on stock options granted (240,000) (320,000)
----------------- -------------------
Total stockholders' equity 1,697,300 1,990,770
----------------- -------------------
Total liabilities and stockholders' equity $ 2,066,753 $ 2,333,974
================= ===================
The accompanying notes are an integral part of these consolidated financial
statements
2
5
CD RADIO INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
For the period
Three months ended May 17,1990
----------------------------- (date of inception)
March 31, March 31, to March 31,
1996 1995 1996
------------- -------------- ------------------
Cash flows from operating activities:
Net loss $ (516,883) $ (433,036) $ (16,222,148)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 14,472 14,177 185,669
Write off of investment in Sky-Highway Radio Corp. - - 2,000,000
Compensation expense in connection with
issuance of stock options 80,000 80,000 1,475,500
Common stock issued for services rendered 63,413 - 410,696
Increase (decrease) in cash and cash equivalents
resulting from changes in assets and liabilities:
Prepaid expense and other 1,653 (3,268) (7,128)
Due to related party - - 350,531
Deposits - (303,793)
Accounts payable and accrued expenses 31,404 (94,928) 153,164
Other liabilities (5,155) 8,457 51,528
----------- ------------- -----------------
Net cash used in operating activities (331,096) (428,598) (11,905,981)
----------- ------------- -----------------
Cash flows from investing activities:
Capital expenditures - (13,822) (392,783)
Acquisition of Sky-Highway Radio Corp. - - (2,000,000)
----------- ------------- -----------------
Net cash used in investing activities - (13,822) (2,392,783)
----------- ------------- -----------------
Cash flows from financing activities:
Proceeds from issuance of units and common stock - - 14,557,482
Proceeds from issuance of promissory notes - - 200,000
Proceeds from issuance of promissory notes to
related parties - - 2,965,000
Proceeds from exercise of stock options by
Company officer 80,000 - 80,000
Repayment of promissory note - - (200,000)
Repayment of promissory notes to related parties - - (2,195,000)
Loan from officer - - 440,000
Deferred offering costs - - -
----------- ------------- -----------------
Net cash provided by financing activities 80,000 - 15,847,482
----------- ------------- -----------------
Net increase (decrease) in cash and cash equivalents (251,096) (442,420) 1,548,718
Cash and cash equivalents at the beginning of period 1,799,814 3,400,261 -
----------- ------------- -----------------
Cash and cash equivalents at the end of period $ 1,548,718 $ 2,957,841 $ 1,548,718
=========== ============= =================
Supplemental disclosure of cash information:
Cash paid during the period for interest $ - $ - $ 40,063
=========== ============= =================
Supplemental disclosure of non-cash financing activities:
Common stock issued in satisfaction of notes
payable to related parties, including
accrued interest $ - $ - $ 998,452
=========== ============= =================
Common stock issued in satisfaction of due to
related parties including accrued interest $ - $ - $ 409,390
=========== ============= =================
Common stock issued in satisfaction of
commissions payable $ - $ - $ 20,000
=========== ============= =================
The accompanying notes are an integral part of these consolidated financial
statements
3
6
CD RADIO INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1996
(UNAUDITED)
GENERAL
The accompanying consolidated financial statements do not include all
of the information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles. In the opinion of management, all adjustments (consisting only of
normal, recurring adjustments) considered necessary to fairly reflect the
Company's consolidated financial position and consolidated results of
operations have been included.
4
7
CD RADIO INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
OVERVIEW
The Company was organized in May 1990 and is in its development stage.
The Company's principal activities to date have included technology
development, pursuing regulatory approval for CD Radio, initiation of
discussions with radio manufacturers and automakers, market research, design,
development, contract negotiations with satellite and launch vehicle
contractors, technical efforts with respect to standards and specifications,
development of a mobile demonstration program and securing adequate working
capital. The Company has been unprofitable to date and expects to continue to
incur substantial losses through at least the first full year of CD Radio
service. Since its inception, the Company has not derived any revenues from
operations and does not expect to generate any revenues from operations prior
to the commencement of CD Radio, which is not expected to occur before the
first half of 1999. In order to commence CD Radio service, the Company will
require the FCC License and substantial additional funds to finance
construction of its satellite system, to plan and implement its service, to
provide working capital and to sustain its operations until it generates
positive cash flows from operations.
In June 1994, the Company undertook measures to reduce the Company's
cash requirements prior to the receipt of the FCC License. As a result of these
efforts, the Company's cash operating expenses, net of cash received from
interest income, was $331,000 for the three months ended March 31, 1996. In
the absence of the FCC License, the Company believes that its working capital
is sufficient to fund planned operations through the first quarter of 1997.
There can be no assurance that the Company's actual cash requirements will not
exceed its anticipated pre-License cash requirements, that additional cash
requirements will not arise or that additional financing will not be required
prior to the receipt of the FCC License.
RESULTS OF OPERATIONS
The Company recorded net losses of $517,000 and $433,000 for the three
months ended March 31, 1996 and 1995, respectively. The Company's total
operating expenses were $537,000 and $472,000 for the three months ended March
31, 1996 and 1995, respectively.
Legal, consulting and regulatory fees increased for the three months
ended March 31, 1996 to $228,000 from $189,000 for the three months ended
March 31, 1995. These levels of expenditures are the result of reduced Company
activity and is expected to remain at this level until the FCC License is
received.
5
8
Research and development costs were $28,000 and $26,000 for the three
months ended March 31, 1996 and 1995, respectively. This minimal level of
research and development cost is the result of the Company completing the
majority of such activities in 1994.
Other general and administrative expenses increased for the three
months ended March 31, 1996 to $282,000 from $257,000 for the three months
ended March 31, 1995. General and administrative expenses continue to remain
at a low level due to a focused effort to reduce costs until such time as the
Company receives the FCC License. The Company also incurred a non-cash charge
of $80,000 for the three month periods ended March 31, 1996 and 1995,
attributable to the recognition of compensation expense in connection with
stock options issued to officers of the Company.
The decrease of interest income to $25,000 for the three months ended
March 31, 1996, from $44,000 in the three months ended March 31, 1995, was the
result of a higher average cash balance during the first quarter of 1995. The
cash and cash equivalents on hand were originally obtained from the Company's
initial public offering in September of 1994.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1996, the Company had working capital of approximately
$1,214,000, compared to $2,554,000 at March 31, 1995. The reduction in working
capital represents the Company's use of cash for operating expenses. The
working capital was primarily obtained in the initial public offering on
September 20, 1994 which resulted in net cash proceeds of $4.4 million,
including the exercise of the underwriters' over-allotment option.
Should the Company receive its FCC License, the Company will require
substantial additional financing to complete the construction and launch of its
satellite system and to fund the first full year of CD Radio.
In the absence of the FCC License, the Company believes that its
working capital is sufficient to fund planned operations through the first
quarter of 1997. There can be no assurance, however, that the Company's actual
cash requirements will not exceed its anticipated pre-FCC License cash
requirements, that additional cash requirements will not arise or that
additional financing will not be required prior to the receipt of the FCC
License.
The Company estimates that upon receipt of the FCC License (assuming
that the FCC License is received in the first half of 1996 and that the
Effective Date occurs upon receipt of the FCC License) it will require cash in
the aggregate amount of $70 million, $181 million and $228 million in the
first, second and third years, respectively, following receipt of the FCC
License to fund the construction and launch of the Company's satellites, the
commencement of CD Radio and to provide cash reserves for the first year of
service.
Upon receipt of the FCC License, the Company intends to seek
additional financing through further debt and equity financings. The Company
intends to use the proceeds of the Offering remaining at that time, if any,
plus additional funds raised through these subsequent financing activities, for
working capital and to fund the commencement of satellite construction.
6
9
However, there can be no assurance that the Company will be able to raise
additional financing on favorable terms, if at all, or that it will be able to
do so on a timely basis. If such financing were not available on a timely
basis, the Company would be required to delay satellite and/or launch vehicle
construction in order to conserve cash to fund continued operations, which
would cause delays in commencement of its operations and increased costs.
The Company's estimates of its cash requirements are forward looking
statements that involve a number of risks and uncertainties. Such estimates
assume that the FCC License is received by the first half of 1996, that the FCC
License is not subject to auction requirements, that the Effective Date occurs
upon receipt of the FCC License and that operation of CD Radio commences in the
first half of 1999. Actual amounts may exceed this estimate, and delays may
occur due to a variety of causes. Cash requirements assume equity financing and
therefore do not include interest payments. The Company's actual future cash
requirements will depend upon numerous factors, including the costs associated
with the construction and deployment of the satellite system and the rate of
growth of its business subsequent to commencing service. Additional funds
would be required in the event of delay, cost overruns, launch failure, launch
services or satellite system change orders, or any shortfalls in estimated
levels of operating cash flow, or to meet unanticipated expenses, or if the FCC
applies auction requirements to the FCC License.
The Company anticipates funding its projected cash requirements
through the completion of additional debt and equity financings. The Company
does not have its financing commitments in place and there can be no assurance
that the Company will be able to obtain financing on favorable terms, if at
all, or that it will be able to do so on a timely basis.
7
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PART II
OTHER INFORMATION
Item 1. Legal Proceedings - None
Item 2. Changes in Securities - None
Item 3. Defaults upon Senior Securities - None
Item 4. Submission of Matters to a Vote of Security Holders - None
Item 5. Other Information - None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
3.1 Amended and Restated Certificate of Incorporation.(2)
3.2 Amended and Restated By-Laws.(2)
4.1 Description of Capital Stock contained in the Amended and Restated
Certificate of Incorporation (see Exhibit 3.1).(2)
4.2 Description of Rights of Security Holders contained in the Amended
and Restated Bylaws (see Exhibit 3.2).(2)
4.3 Form of Certificate for Shares of Common Stock.(3)
4.4 Form of Common Stock Purchase Warrant Agreement between the Company
and Continental Stock Transfer and Trust Company.(4)
4.5 Form of Common Stock Purchase Warrant Certificate.(4)
4.6 Form of Representatives' Warrant Agreement among the Company, First
Marathon (U.S.A.) Inc., First Marathon Securities Limited and
Continental Stock Transfer and Trust Company.(4)
4.7 Form of Representatives' Warrant Certificate.(4)
10.1 Option Agreement, dated January 23, 1992, between the Company and
New World Sky Media.(2)
10.2.1 Agreement, dated May 22, 1992, between Ivanhoe Capital Corporation
and the Company.(2)
10.2.2 Termination of Ivanhoe Agreement, dated January 2, 1994.(2)
10.3 Lease Agreement, dated October 20, 1992, between 22nd & K Street
Office Building Limited Partnership and the Company.(2)
10.4 Letter Agreement, dated November 18, 1992, between the Company and
Batchelder & Partners, Inc.(2)
10.5.1 Employment Agreement, dated January 29, 1993, between the Company
and Richard Cooperman.(5)
10.5.2 Agreement, dated June 20, 1994, between the Company and Richard
Cooperman.(6)
10.6 Proprietary Information and Non-Competition Agreement, dated
February 1, 1993, for Richard Cooperman.(2)
10.7 Option and Purchase Agreement, dated February 2, 1993, between the
Company and Charles W. Ergen and David M. Drucker.(2)
10.8.1 Proprietary Information and Non-Competition Agreement, dated
February 9, 1993, for Robert Briskman.(2)
10.8.2 Amendment No. 1 to Proprietary Information and Non-Competition
Agreement between the Company and Robert Briskman.(2)
**10.9.1 Satellite Construction Agreement, dated March 2, 1993, between
Space Systems/Loral and the Company.(2)
**10.9.2 Amendment No. 1 to Satellite Construction Agreement, effective
December 28, 1993, between Space Systems/Loral and the Company.(2)
**10.9.3 Amendment No. 2 to Satellite Construction Agreement, effective
March 8, 1994, between Space Systems/Loral and the Company.(3)
10.9.4 Amendment No. 3 to Satellite Construction Agreement, effective
February 12, 1996, between Space Systems/Loral, Inc. and the
Company.(15)
10.10 Assignment of Technology Agreement, dated April 15, 1993, between
Robert Briskman and the Company.(2)
10.11 Agency Agreement, dated April 27, 1993, between the Company and
First Marathon Securities Limited.(2)
10.12 Demand Note and Grant of Warrant to Robert Friedland, dated
April 28, 1993.(2)
10.13 Amended and Restated Option Agreement between the Company and
Robert Briskman.(2)
10.14 Demand Note and Grant of Warrant to Robert Friedland, dated
October 13, 1993.(2)
10.15.1 Launch Reservation Agreement, dated September 20, 1993, between the
Company and Arianespace.(7)
10.15.2 Modification of Launch Reservation Agreement, dated April 1, 1994,
between the Company and Arianespace.(3)
10.15.3 Second Modification of Launch Reservation Agreement, dated
August 10, 1994, between the Company and Arianespace.(8)
10.16 Option Agreement, effective as of October 16, 1991, between the
Company and Charles Dalfen.(2)
10.17 Option Agreement, effective as of October 16, 1992, between the
Company and Charles Dalfen.(2)
10.18.1 Employment and Noncompetition Agreement between the Company and
David Margolese.(9)
10.18.2 First Amendment to Employment Agreement between the Company and
David Margolese.(6)
10.19.1 Employment and Noncompetition Agreement between the Company and
Robert Briskman.(10)
10.19.2 First Amendment to Employment Agreement between the Company and
Robert Briskman.(6)
10.20 Registration Agreement, dated January 2, 1994, between the Company
and M.A. Rothblatt and B.A. Rothblatt.(2)
10.21 1994 Stock Option Plan.(2)
10.22 Amended and Restated 1994 Directors' Nonqualified Stock Option
Plan.(15)
10.23 Form of Lock-Up Agreement executed by certain holders of the
Company's Common Stock.(6)
10.24 Option Agreement, dated as of October 21, 1992, between the Company
and Batchelder & Partners, Inc.(11)
10.25 Settlement Agreement, dated as of February 2, 1994, between the
Company and New World Sky Media Inc. and Bryan Kim.(2)
10.26.1 Employment and Noncompetition Agreement between the Company and
Margaret E. Grayson.(12)
10.26.2 First Amendment to Employment Agreement between the Company and
Margaret E. Grayson.(6)
10.26.3 Second Amendment to Employment Agreement between the Company and
Margaret E. Grayson.(6)
10.27 Settlement Agreement, dated as of April 1, 1994, among the Company,
M.A. Rothblatt, B.A. Rothblatt and Marcor, Inc.(3)
10.28.1 Demand Note, dated April 19, 1994, in favor of David Margolese.(13)
10.28.2 Note, dated June 30, 1994, in favor of David Margolese.(8)
10.29 Demand Note, dated April 19, 1994, between the Company and D.
Friedland.(6)
10.30.1 Demand Note, dated July 5, 1994, in favor of Jobrenco Limited.(6)
10.30.2 Security Agreement, dated July 5, 1994, between the Company and
Jobrenco Limited.(6)
10.31 Placement Agreement, dated April 27, 1993, between the Company and
First Marathon Securities Limited.(6)
10.32 Letter of Understanding, dated December 3, 1993, between the
Company and The Seidler Companies Incorporated.(6)
10.33 Form of Subscription Agreement among First Marathon Securities
Limited and Canadian Purchasers.(1)
10.34 Form of Subscription Agreement among First Marathon Securities
Limited and Non-U.S. and Non-Canadian Purchasers.(1)
10.35 Form of Underwriting Agreement (see Exhibit 1.1)
10.36 Letter Agreement, dated January 13, 1995, between the Company and
Brenner Securities.(14)
10.37 1995 Stock Compensation Plan.(15)
11.1 Computation of net loss per share
27.1 Financial Data Schedule
(b) Reports on Form 8-K
On March 5, 1996, the Company filed a report on Form
8-K under Item 5 and Item 7, announcing the extension of
the exercise period of the Company's Class A Common
Stock Purchase Warrants and filing a copy of the Press
Release dated March 5, 1996, as Exhibit 99.1
- - --------------
** Portions of these exhibits have been omitted pursuant to an Application for
Confidential Treatment filed with the Securities and Exchange Commission
pursuant to Rule 406 of the Securities Act of 1933, as amended.
(1) Incorporated by reference to the same-numbered exhibit to Amendment
No. 5, filed September 8, 1994, to the Registrant's Registration
Statement No. 33-74782 M Form S-1 filed with the Commission on
February 2, 1994.
(2) Incorporated by reference to the same-numbered exhibit to the
Registrant's Registration Statement No. 33-74782 on Form S-1 filed with
the Commission on February 2, 1994.
(3) Incorporated by reference to the same-numbered exhibit to Amendment
No. 2, filed with the Commission on April 14, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(4) Incorporated by reference to the same-numbered exhibit to Amendment
No. 5, filed with the Commission on September 8, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(5) Incorporated by reference to exhibit 10.5 to the Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(6) Incorporated by reference to the same-numbered exhibit to Amendment
No. 5, filed with the Commission on August 2, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(7) Incorporated by reference to Exhibit No. 10.15 to the Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(8) Incorporated by reference to the same-numbered exhibit to Amendment
No. 4, filed with the Commission on August 14, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994
(9) Incorporated by reference to Exhibit No. 10.18 to the Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(10) Incorporated by reference to Exhibit No. 10.19 to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(11) Incorporated by reference to Exhibit No. 1, filed with the
Commission on March 14, 1994, to Registrant's Registration Statement
No. 33-74782 on Form S-1 as filed with the Commission on February 2, 1994.
(12) Incorporated by reference to Exhibit No. 10.26 to Amendment No. 2,
filed with the Commission on April 13, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 as filed with the
Commission on February 2, 1994.
(13) Incorporated by reference to Exhibit No. 10.28 to Amendment No. 3
filed with the Commission on August 2, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 as filed with the
Commission on February 2, 1994.
(14) Incorporated by reference to the same-numbered exhibit to
Registrant's Annual Report in Form 10-K for the fiscal year ended
December 31, 1994, Commission File No. 0-24710.
(15) Incorporated by reference to the same-numbered exhibit to
Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995, Commission File No. 0-24710.
8
11
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CD RADIO INC.
(Registrant)
Date: May 14, 1996 /s/ David Margolese
--------------------------------
Chairman and
Chief Executive Officer
(Duly authorized officer and
principal financial officer)
12
CD RADIO INC.
INDEX TO EXHIBITS
EXHIBIT PAGE
NUMBER DESCRIPTION NO.
- - ------- ----------- -----
3.1 Amended and Restated Certificate of Incorporation.(2)....................
3.2 Amended and Restated By-Laws.(2) ........................................
4.1 Description of Capital Stock contained in the Amended and
Restated Certificate of Incorporation (see Exhibit 3.1).(2) .............
4.2 Description of Rights of Security Holders contained in the
Amended and Restated Bylaws (see Exhibit 3.2).(2) .......................
4.3 Form of Certificate for Shares of Common Stock.(3) ......................
4.4 Form of Common Stock Purchase Warrant Agreement between
the Company and Continental Stock Transfer and Trust
Company.(4) .............................................................
4.5 Form of Common Stock Purchase Warrant Certificate.(4) ...................
4.6 Form of Representatives' Warrant Agreement among the
Company, First Marathon (U.S.A.) Inc., First Marathon
Securities Limited and Continental Stock Transfer and
Trust Company.(4) .......................................................
4.7 Form of Representatives' Warrant Certificate.(4) ........................
10.1 Option Agreement, dated January 23, 1992, between the
Company and New World Sky Media.(2) .....................................
10.2.1 Agreement, dated May 22, 1992, between Ivanhoe Capital
Corporation and the Company.(2) .........................................
10.2.2 Termination of Ivanhoe Agreement, dated January 2, 1994.(2) .............
10.3 Lease Agreement, dated October 20, 1992, between 22nd & K
Street Office Building Limited Partnership and the Company.(2) ..........
10.4 Letter Agreement, dated November 18, 1992, between the
Company and Batchelder & Partners, Inc.(2) ..............................
10.5.1 Employment Agreement, dated January 29, 1993, between the
Company and Richard Cooperman.(5) .......................................
10.5.2 Agreement, dated June 20, 1994, between the Company and
Richard Cooperman.(6) ...................................................
10.6 Proprietary Information and Non-Competition Agreement,
dated February 1, 1993, for Richard Cooperman.(2) .......................
10.7 Option and Purchase Agreement, dated February 2, 1993,
between the Company and Charles W. Ergen and David M.
Drucker.(2) .............................................................
10.8.1 Proprietary Information and Non-Competition Agreement,
dated February 9, 1993, for Robert Briskman.(2) .........................
10.8.2 Amendment No. 1 to Proprietary Information and
Non-Competition Agreement between the Company and Robert
Briskman.(2) ...........................................................
**10.9.1 Satellite Construction Agreement, dated March 2, 1993,
between Space Systems/Loral and the Company.(2)..........................
**10.9.2 Amendment No. 1 to Satellite Construction Agreement,
effective December 28, 1993, between Space Systems/Loral
and the Company.(2) .....................................................
**10.9.3 Amendment No. 2 to Satellite Construction Agreement,
effective March 8, 1994, between Space Systems/Loral and
the Company.(3)..........................................................
10.9.4 Amendment No. 3 to Satellite Construction Agreement,
effective February 12, 1996, between Space Systems/Loral,
Inc. and the Company.(15) ...............................................
10.10 Assignment of Technology Agreement, dated April 15, 1993,
between Robert Briskman and the Company.(2) .............................
10.11 Agency Agreement, dated April 27, 1993, between the
Company and First Marathon Securities Limited.(2) .......................
10.12 Demand Note and Grant of Warrant to Robert Friedland,
dated April 28, 1993.(2) ................................................
10.13 Amended and Restated Option Agreement between the Company
and Robert Briskman.(2) .................................................
10.14 Demand Note and Grant of Warrant to Robert Friedland,
dated October 13, 1993.(2) ..............................................
10.15.1 Launch Reservation Agreement, dated September 20, 1993,
between the Company and Arianespace.(7) .................................
10.15.2 Modification of Launch Reservation Agreement, dated
April 1, 1994, between the Company and Arianespace.(3) ..................
10.15.3 Second Modification of Launch Reservation Agreement, dated
August 10, 1994, between the Company and Arianespace.(8) ................
10.16 Option Agreement, effective as of October 16, 1991,
between the Company and Charles Dalfen.(2) ..............................
13
EXHIBIT PAGE
NUMBER DESCRIPTION NO.
- - ------- ----------- -----
10.17 Option Agreement, effective as of October 16, 1992,
between the Company and Charles Dalfen.(2) ...............................
10.18.1 Employment and Noncompetition Agreement between the
Company and David Margolese.(9) ..........................................
10.18.2 First Amendment to Employment Agreement between the
Company and David Margolese.(6) ..........................................
10.19.1 Employment and Noncompetition Agreement between the
Company and Robert Briskman.(10) .........................................
10.19.2 First Amendment to Employment Agreement between the
Company and Robert Briskman.(6) ..........................................
10.20 Registration Agreement, dated January 2, 1994, between the
Company and M.A. Rothblatt and B.A. Rothblatt.(2) ........................
10.21 1994 Stock Option Plan.(2) ...............................................
10.22 Amended and Restated 1994 Directors' Nonqualified Stock
Option Plan.(15) ........................................................
10.23 Form of Lock-Up Agreement executed by certain holders of
the Company's Common Stock.(6) ...........................................
10.24 Option Agreement, dated as of October 21, 1992, between
the Company and Batchelder & Partners, Inc.(11) ..........................
10.25 Settlement Agreement, dated as of February 2, 1994,
between the Company and New World Sky Media Inc. and Bryan Kim.(2) .......
10.26.1 Employment and Noncompetition Agreement between the
Company and Margaret E. Grayson.(12) .....................................
10.26.2 First Amendment to Employment Agreement between the
Company and Margaret E. Grayson.(6) ......................................
10.26.3 Second Amendment to Employment Agreement between the
Company and Margaret E. Grayson.(6) ......................................
10.27 Settlement Agreement, dated as of April 1, 1994, among the
Company, M.A. Rothblatt, B.A. Rothblatt and Marcor, Inc.(3) ..............
10.28.1 Demand Note, dated April 19, 1994, in favor of David
Margolese.(13) ...........................................................
10.28.2 Note, dated June 30, 1994, in favor of David Margolese.(8) ...............
10.29 Demand Note, dated April 19, 1994, between the Company and
D. Friedland.(6) ........................................................
10.30.1 Demand Note, dated July 5, 1994, in favor of Jobrenco Limited.(6) ........
10.30.2 Security Agreement, dated July 5, 1994, between the
Company and Jobrenco Limited.(6) .........................................
10.31 Placement Agreement, dated April 27, 1993, between the
Company and First Marathon Securities Limited.(6) ........................
10.32 Letter of Understanding, dated December 3, 1993, between
the Company and The Seidler Companies Incorporated.(6) ...................
10.33 Form of Subscription Agreement among First Marathon
Securities Limited and Canadian Purchasers.(1) ...........................
10.34 Form of Subscription Agreement among First Marathon
Securities Limited and Non-U.S. and Non-Canadian Purchasers.(1) ..........
10.35 Form of Underwriting Agreement (see Exhibit 1.1) .........................
10.36 Letter Agreement, dated January 13, 1995, between the Company
and Brenner Securities.(14) ..............................................
10.37 1995 Stock Compensation Plan.(15) ........................................
11.1 Computation of net loss per share ........................................
27.1 Financial Data Schedule ..................................................
- - -------------
** Portions of these exhibits have been omitted pursuant to an Application for
Confidential Treatment filed with the Securities and Exchange Commission
pursuant to Rule 406 of the Securities Act of 1933, as amended.
(1) Incorporated by reference to the same-numbered exhibit to Amendment
No. 5, filed September 8, 1994, to the Registrant's Registration
Statement No. 33-74782 M Form S-1 filed with the Commission on
February 2, 1994.
(2) Incorporated by reference to the same-numbered exhibit to the
Registrant's Registration Statement No. 33-74782 on Form S-1 filed with
the Commission on February 2, 1994.
(3) Incorporated by reference to the same-numbered exhibit to Amendment
No. 2, filed with the Commission on April 14, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(4) Incorporated by reference to the same-numbered exhibit to Amendment
No. 5, filed with the Commission on September 8, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(5) Incorporated by reference to exhibit 10.5 to the Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
14
(6) Incorporated by reference to the same-numbered exhibit to Amendment
No. 5, filed with the Commission on August 2, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(7) Incorporated by reference to Exhibit No. 10.15 to the Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(8) Incorporated by reference to the same-numbered exhibit to Amendment
No. 4, filed with the Commission on August 14, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994
(9) Incorporated by reference to Exhibit No. 10.18 to the Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(10) Incorporated by reference to Exhibit No. 10.19 to Registrant's
Registration Statement No. 33-74782 on Form S-1 filed with the
Commission on February 2, 1994.
(11) Incorporated by reference to Exhibit No. 1, filed with the
Commission on March 14, 1994, to Registrant's Registration Statement
No. 33-74782 on Form S-1 as filed with the Commission on February 2,
1994.
(12) Incorporated by reference to Exhibit No. 10.26 to Amendment No. 2,
filed with the Commission on April 13, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 as filed with the
Commission on February 2, 1994.
(13) Incorporated by reference to Exhibit No. 10.28 to Amendment No. 3
filed with the Commission on August 2, 1994, to Registrant's
Registration Statement No. 33-74782 on Form S-1 as filed with the
Commission on February 2, 1994.
(14) Incorporated by reference to the same-numbered exhibit to
Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994, Commission File No. 0-24710.
(15) Incorporated by reference to the same-numbered exhibit to
Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995.