<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended May 31, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from _______ to ________
Commission File Number 1-9244
_____________________________
KING WORLD PRODUCTIONS, INC.
____________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 13-2565808
_______________________________ ___________________________________
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1700 Broadway
New York, New York 10019
_______________________________________ __________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 212 315-4000
____________
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 ______
____<PAGE>
<PAGE>
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date. Common
Stock, $.01 par value, 36,758,817 shares outstanding as of June 23,
1997.<PAGE>
<PAGE>
KING WORLD PRODUCTIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
(Dollars in thousands)
May 31, August 31,
1997 1996
_________ __________
(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents . . . . . . . . . $276,141 $344,766
Short-term investments. . . . . . . . . . . 233,634 153,969
Accounts receivable (net of allowance
for doubtful accounts of $4,101 and
$4,196 at May 31, 1997 and August 31,
1996, respectively) . . . . . . . . . . . 66,388 60,378
Producer advances and
deferred costs. . . . . . . . . . . . . . 79,681 74,824
Other current assets. . . . . . . . . . . . 2,171 1,932
_______ _______
Total current assets . . . . . . . . . 658,015 635,869
_______ _______
LONG-TERM INVESTMENTS, at cost, which
approximates market value . . . . . . . . 184,982 145,645
_______ _______
FIXED ASSETS, at cost . . . . . . . . . . . . 20,967 13,384
Less - accumulated depreciation
and amortization. . . . . . . . . . . . . (11,750) (10,503)
______ ______
. . . . . . . . . . . . . . . . . . . . . . . 9,217 2,881
______ ______
PRODUCER ADVANCES
AND OTHER ASSETS. . . . . . . . . . . . . . 9,469 69,746
______ ______
$861,683 $854,141
________ ________
The accompanying Notes to Consolidated Financial Statements
are an integral part of these balance sheets. <PAGE>
<PAGE>
KING WORLD PRODUCTIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
(Dollars in thousands)
May 31, August 31,
1997 1996
_________ __________
(Unaudited)
CURRENT LIABILITIES:
Accounts payable and
accrued liabilities . . . . . . . . . . $ 17,461 $ 15,237
Payable to producers and others . . . . . 65,273 71,920
Income taxes payable. . . . . . . . . . . 27,161 29,099
Total current liabilities . . . . 109,895 116,256
________ ________
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value;
5,000,000 shares authorized,
none issued . . . . . . . . . . . . . . -- --
Common stock, $.01 par value;
75,000,000 shares autho-
rized, 50,864,211 shares and
50,734,739 shares issued
at May 31, 1997 and August 31,
1996, respectively. . . . . . . . . . . 509 507
Paid-in capital . . . . . . . . . . . . . 116,800 110,666
Retained earnings . . . . . . . . . . . . 965,157 932,651
Treasury stock, at cost; 14,105,394 and
13,442,594 shares at May 31, 1997 and
August 31, 1996, respectively . . . . . (330,678) (305,939)
_______ _______
751,788 737,885
_______ _______
$861,683 $854,141
_______ _______
The accompanying Notes to Consolidated Financial Statements
are an integral part of these balance sheets.<PAGE>
<PAGE>
KING WORLD PRODUCTIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended Nine Months Ended
May 31, May 31,
__________________ _________________
1997 1996 1997 1996
_____ ______ _____ ______
(Dollars in thousands except per share data)
REVENUES....................... $166,751 $165,763 $506,207 $504,687
________ ________ ________ ________
EXPENSES:
Producers' fees, programming
and other direct
operating costs............ 97,745 98,648 300,315 304,779
Selling, general and
administrative expenses.... 22,385 18,106 62,078 56,153
_______ _______ _______ _______
120,130 116,754 362,393 360,932
_______ _______ _______ _______
Income from operations..... 46,621 49,009 143,814 143,755
INTEREST AND
DIVIDEND INCOME.............. 8,269 6,218 22,184 19,124
NONRECURRING GAIN - Sale of
Buffalo Broadcasting Co. Inc. -- -- -- 14,060
_______ _______ _______ _______
Income before provision
for income taxes......... 54,890 55,227 165,998 176,939
PROVISION FOR INCOME TAXES..... 19,185 20,041 58,649 62,930
________ ________ ________ ________
Net income................. $ 35,705 $ 35,186 $107,349 $114,009
________ ________ ________ ________
PRIMARY EARNINGS PER
SHARE........................ $ 0.95 $ 0.92 $ 2.85 $ 3.03
________ ________ ________ ________
<PAGE>
The accompanying Notes to Consolidated Financial Statements
are an integral part of these statements.
<PAGE>
KING WORLD PRODUCTIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
May 31,
______________________
1997 1996
________ ________
(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income. . . . . . . . . . . . . . . . . . . . $107,349 $114,009
Items not affecting cash:
Gain on sale of Buffalo
Broadcasting Co. Inc. . . . . . . . . . . -- (14,060)
Depreciation and amortization . . . . . . . 1,247 592
Change in assets and liabilities:
Accounts receivable . . . . . . . . . . . . (5,922) (15,552)
Producer advances and deferred
costs . . . . . . . . . . . . . . . . . . 55,143 (56,836)
Accounts payable and accrued
liabilities . . . . . . . . . . . . . . . 2,224 4,512
Payable to producers and others . . . . . . (6,647) 13,671
Income taxes payable. . . . . . . . . . . . (1,939) 5,240
Other, net. . . . . . . . . . . . . . . . . (50) (4,657)
________ ________
Net cash provided by operating
activities . . . . . . . . . . . . . . . . . . 151,405 46,919
________ ________
CASH FLOWS FROM INVESTING ACTIVITIES:
Increase in investments. . . . . . . . . . . . . (119,002) (42,726)
Proceeds from sale of Buffalo
Broadcasting Co. Inc.. . . . . . . . . . . . . -- 9,802
Additions to fixed assets. . . . . . . . . . . . (7,584) (321)
________ ________
Net cash used in investing
activities. . . . . . . . . . . . . . . . . . . (126,586) (33,245)
________ ________
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock . . . . . 6,138 22,547
Purchase of treasury stock . . . . . . . . . . . (24,739) --
Payment of special dividend. . . . . . . . . . . (74,843) --
________ ________
Net cash (used in) provided by
financing activities . . . . . . . . . . . . . (93,444) 22,547
________ ________
NET (DECREASE) INCREASE IN CASH AND
CASH EQUIVALENTS. . . . . . . . . . . . . . . . . (68,625) 36,221
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD . . . . . . . . . . . . . . . . . . . . 344,766 446,896
________ ________
CASH AND CASH EQUIVALENTS AT END
OF PERIOD . . . . . . . . . . . . . . . . . . . . $276,141 $483,117
<PAGE>
________ ________
The accompanying Notes to Consolidated Financial Statements
are an integral part of these statements. <PAGE>
<PAGE>
KING WORLD PRODUCTIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(1) Summary of significant accounting policies
Principles of consolidation
___________________________
The accompanying consolidated financial statements include the accounts
of King World Productions, Inc. ("King World") and its wholly-owned
subsidiaries. All significant intercompany transactions have been eliminated.
Unless the context suggests otherwise, the "Company", as used herein, means
King World and its subsidiaries.
The unaudited consolidated financial statements for the nine months and
three months ended May 31, 1997 have been prepared in accordance with the
instructions to Form 10-Q and include, in the opinion of management, all
adjustments (consisting only of normal recurring accruals) necessary for a
fair presentation of the results of operations for such periods. They do not,
however, include all of the information and disclosures required by generally
accepted accounting principles for complete financial statements. For further
information, reference is made to the consolidated financial statements for
the fiscal year ended August 31, 1996 and the footnotes related thereto
included in the Company's Annual Report on Form 10-K from which the August 31,
1996 balances presented herein have been derived. The results of operations
for the nine months and three months ended May 31, 1997 are not necessarily
indicative of the results of operations for the full year.
Revenue recognition
___________________
License fees from first-run syndicated television properties are recog-
nized at the commencement of the license period pursuant to noncancelable
agreements and as each show is made available to the licensee via satellite
transmission. Because transmission to the satellite takes place, on the aver-
age, no more than two to three days prior to the broadcast of the programming,
revenues are recognized on or about the air date.
The Company typically receives a portion of the fees derived from the
licensing of syndicated television programming in the form of retained adver-
tising time, which is sold to advertisers by Camelot Entertainment Sales, Inc.
("Camelot"), a wholly-owned<PAGE>
<PAGE>
subsidiary of the Company. Such revenues are recognized at the same time as
the cash portion of the license fees derived from such programming is recog-
nized, in amounts adjusted for expected ratings.
<PAGE>
<PAGE>
(1) Summary of significant accounting policies (continued)
License fees for non-first-run syndicated properties are recognized at
the gross contract amount (net of discount to present value for license
periods greater than one year) at the commencement of the license period.
Principal properties
____________________
The Company's principal properties are licenses to distribute THE OPRAH
WINFREY SHOW, WHEEL OF FORTUNE and JEOPARDY!; and INSIDE EDITION, a first-run
syndicated newsmagazine series produced and distributed by the Company. THE
OPRAH WINFREY SHOW accounted for approximately 40% and 39% of revenues for the
nine months ended May 31, 1997 and 1996, respectively; WHEEL OF FORTUNE
accounted for approximately 20% and 19% of revenues for such periods, respec-
tively; JEOPARDY! accounted for approximately 17% of revenues for each such
period; and INSIDE EDITION accounted for approximately 8% of revenues for each
such period.
Producers' fees, programming and other direct operating costs
_____________________________________________________________
Producers' fees, programming and other direct operating costs primarily
include the producers' share of both cash license fees from the sale of
programming to television stations and revenues derived from the sale of
retained advertising time to advertisers with respect to programming dis-
tributed by the Company; participation fees payable by the Company to
producers and talent; production and distribution costs for first-run syndi-
cated programming; and the direct operating costs of King World Direct. That
portion of recognized revenue that is to be paid to producers and owners of
programming is accrued as the license fees are earned. The share of license
fees payable by the Company to such producers and others is generally paid as
cash license fees and revenues derived from the sale of retained advertising
time are received from television stations and advertisers.
<PAGE>
<PAGE>
(1) Summary of significant accounting policies (continued)
Stockholders' equity
____________________
Primary earnings per share has been computed using the weighted average
number of common shares outstanding of 37,453,000 and 38,178,000, respec-
tively, for the three months ended May 31, 1997 and 1996 and 37,660,000 and
37,646,000, respectively, for the nine months ended May 31, 1997 and 1996,
which include the dilutive effect from the assumed exercise of vested and
unvested stock options outstanding as of the end of each such period. The
difference between primary and fully diluted earnings per share for all
periods presented was not significant.
(2) Nonrecurring gain - sale of Buffalo Broadcasting Co. Inc.
In October 1995, the Company closed its agreement to sell WIVB-TV, the
CBS-affiliated VHF television station in Buffalo, New York, to LIN Television
Corporation for $95 million in cash. As a result of this transaction, the
Company recorded a nonrecurring gain of approximately $14.1 million, of which
approximately $9.8 million represents cash proceeds to the Company from the
sale. The remaining $4.3 million of such gain represents the reversal of
previously recognized accounting losses (with no associated income tax effect)
in excess of the Company's original investment.
(3) Producer advances
On January 2, 1996, the Company paid Harpo, Inc. ("Harpo"), the
producer of THE OPRAH WINFREY SHOW, a $65 million advance against its minimum
participation payments for the 1996-1997 broadcast season. This advance was
fully recouped as of May 31, 1997. In addition, on January 2, 1996, the
Company made an advance to Harpo of $65 million against Harpo's minimum
participation payments for the 1997-1998 broadcast season, none of which had
been recouped as of May 31, 1997. Based on the license agreements in place
for the 1997-1998 season, the Company believes that revenues from the series
will be sufficient to enable the Company to recoup the advance for such
season. Such advance is refundable to the Company by Harpo and Ms. Winfrey if
King World terminates such license agreements with Harpo due to Harpo's
failure to deliver episodes of THE OPRAH WINFREY SHOW.<PAGE>
<PAGE>
Item 2. Management's Discussion and Analysis of
Results of Operations and Financial Condition
_____________________________________________
RESULTS OF OPERATIONS
Comparison of Nine Months and Three Months Ended May 31, 1997 and 1996
Revenues
________
Revenues for the first nine months of fiscal 1997 were comparable to
revenues for the first nine months of the prior fiscal year, increasing by
less than 1%. Such increase was primarily due to increased cash license fees
from THE OPRAH WINFREY SHOW, WHEEL OF FORTUNE and, to a lesser extent, JEOPAR-
DY!. The increase in revenues was offset by lower revenues derived from the
sale of retained advertising time on INSIDE EDITION, AMERICAN JOURNAL, another
first-run syndicated newsmagazine produced and distributed by the Company, and
ROLONDA, a first-run syndicated talk show produced and distributed by the
Company, and by lower revenues from King World Direct Inc., the Company's
wholly-owned direct response subsidiary. King World Direct's revenues for
such period were derived primarily from telemarketing sales of the WILD
AMERICA video series and from participation in the retail sales of certain
Sears products, including the Craftsman Robogrip pliers. King World Direct
operates in a seasonal business with revenues heavily reliant on the Christmas
selling season. Consequently, King World Direct's revenues and earnings have
historically been higher in the Company's second fiscal quarter than in the
first, third and fourth fiscal quarters.
The Company's revenues for the three months ended May 31, 1997 were
comparable to revenues for the three months ended May 31, 1996, increasing by
approximately 1% due primarily to the same factors discussed above for the
nine month period (with the exception of King World Direct, which had com-
parable revenues during both three month periods).
THE OPRAH WINFREY SHOW, WHEEL OF FORTUNE, JEOPARDY! and INSIDE EDITION
accounted for approximately 40%, 20%, 17% and 8%, respectively, of the Compa-
ny's revenues for the first nine months of fiscal 1997 compared to 39%, 19%,
17% and 8%, respectively, for the first nine months of fiscal 1996. AMERICAN
JOURNAL accounted for approximately 4% of the Company's revenues for the first
nine months in each of fiscal 1997 and fiscal 1996, and ROLONDA accounted for
approximately 1% of the Company's revenues for the first nine months of fiscal
1997 and 2% for the first
<PAGE>
<PAGE>
nine months of fiscal 1996. King World Direct accounted for approximately 4%
of the Company's revenues for the nine months ended May 31, 1997, and 5% for
the nine months ended May 31, 1996.
For the three months ended May 31, 1997, THE OPRAH WINFREY SHOW, WHEEL
OF FORTUNE, JEOPARDY! and INSIDE EDITION accounted for approximately 41%, 21%,
17% and 8%, respectively, of the Company's revenues compared to 40%, 20%, 17%
and 8%, respectively, for the three months ended May 31, 1996. AMERICAN
JOURNAL accounted for approximately 4% of the Company's revenues for each of
the three months ended May 31, 1997 and 1996, and ROLONDA accounted for
approximately 1% of the Company's revenues for the three months ended May 31,
1997 and 2% for the three months ended May 31, 1996. King World Direct ac-
counted for approximately 2% of the Company's revenues for each of the three
months ended May 31, 1997 and 1996.
Producers' fees, programming and other direct operating costs
_____________________________________________________________
Producers' fees, programming and other direct operating costs decreased
by approximately 1% in the first nine months of fiscal 1997 compared to the
first nine months of fiscal 1996, primarily as a result of a significant
decrease in operating costs of King World Direct, offset by a modest increase
in revenues generated by THE OPRAH WINFREY SHOW, WHEEL OF FORTUNE and, to a
lesser extent, JEOPARDY! (a portion of which revenues is payable to the
producer of each such series). For the three months ended May 31, 1997,
producers' fees, programming and other direct operating costs decreased by
approximately 1% compared to the three months ended May 31, 1996, due
primarily to the same factors as those discussed above for the nine month
period (with the exception of King World Direct, which had comparable operat-
ing costs during both three month periods).
Selling, general and administrative expenses
____________________________________________
In December 1995, the Company entered into new employment agreements
with Michael King and Roger King, its two principal executive officers. The
agreements provide, among other things, for annual performance-based bonuses,
including bonuses payable upon the introduction of new shows and bonuses which
vary depending on the Company's net income and Common Stock price during
preestablished measurement periods. As a result, the Company's compensation
expense will increase if the Company introduces a new series in syndication,
if the Company's net income increases or if the Common Stock price exceeds the
specified levels during the applicable measurement periods. The Company has
recognized<PAGE>
<PAGE>
the impact of certain of these bonuses in its operating results for the first,
second and third quarters of fiscal 1997, which includes all amounts payable
in accordance with the terms of such employment agreements.
Selling, general and administrative expenses for the first nine months
and the third quarter of fiscal 1997 increased by approximately 11% and 24%,
respectively, from the corresponding periods of fiscal 1996. Such increases
were primarily due to a general increase in advertising and promotion costs,
particularly with respect to THE OPRAH WINFREY SHOW and AMERICAN JOURNAL, and
an increase in compensation costs associated principally with the hiring of
new executives and additional personnel. In addition, selling, general and
administrative expenses for the third quarter of fiscal 1997 were impacted by
increased activity with respect to programming under development.
Net income and primary earnings per share
_________________________________________
Due to the factors discussed above, the Company's operating income for
the nine months ended May 31, 1997 was comparable to the corresponding period
of the prior year, increasing by less than 1%, while operating income for the
three month period decreased by approximately 5%. Reported net income for the
nine month period decreased by approximately $6.7 million compared to the
corresponding period of the prior year as a result of the Company recording a
nonrecurring gain of approximately $14.1 million on the sale of Buffalo
Broadcasting Co. Inc. ("Buffalo") to LIN Television Corporation during the
first quarter of fiscal 1996. Reported primary earnings per share decreased
for the nine months ended May 31, 1997, to $2.85 per share, from $ 3.03 per
share for the nine months ended May 31, 1996 as a result of the nonrecurring
gain from the sale of Buffalo.
Absent the nonrecurring gain on the sale of Buffalo, net income in-
creased by approximately $3.6 million, or 3%, for the nine months ended May
31, 1997 in comparison to the nine months ended May 31, 1996, reflecting the
slight increase in operating income, higher interest income earned on the
Company's cash and investments and a lower effective tax rate for the first
nine months of fiscal 1997 compared with the first nine months of fiscal 1996.
Absent the nonrecurring gain on the sale of Buffalo, primary earnings per
share increased by $.09 per share, or approximately 3%, for the nine months
ended May 31, 1997 compared to the corresponding period of fiscal 1996, as a
result of the increase in net income. Net income for the three months ended
May 31, 1997 increased by approximately $500,000, or 1%, compared to the
corresponding period of fiscal 1996, as a result of greater interest income
and a lower effective tax rate, offset by<PAGE>
<PAGE>
the decline in operating income. Primary earnings per share increased by $.03
per share, or 3%, for the three months ended May 31, 1997 compared to the
three months ended May 31, 1996 due to the increase in net income and the
smaller number of shares outstanding as a result of the Company's share
repurchase program.
The Company's results of operations are highly dependent upon the
viewing preferences of television audiences and the Company's ability to
acquire distribution rights to, or itself produce, television programming that
achieves broad and enduring audience acceptance. The success of the Company's
programming could be significantly affected by changes in viewer preferences
or the unavailability of new programming or talent. Moreover, the amount of
revenue derived from the sale of retained advertising time is dependent upon a
large number of factors, such as household ratings, the demographic
composition of the viewing audience and economic conditions in general and in
the advertising business in particular.
Due to the success of the shows distributed by the Company and in order
to mitigate the influence of some of the factors referred to above, the
Company has been obtaining multi-year licenses and license renewals from
television stations for its principal distribution properties, extending as
far into the future as the 2001-2002 broadcast season. In general, these
licenses and renewals have been at rates as favorable or more favorable to the
Company than the rates applicable to the 1996-1997 broadcast season. All such
licenses and renewals are contingent upon the continued production of the
series by their respective producers through the broadcast seasons for which
the licenses run.
The Company believes that the impact of inflation on its operations has
not been significant.
LIQUIDITY AND CAPITAL RESOURCES
The Company requires capital resources to fund development, production
and promotion costs of independently produced programming, including, in some
instances, advances to producers and talent, to produce its own programs and
to acquire distribution rights to new programming. In acquiring distribution
rights from independent producers, King World has tried to avoid making
significant capital commitments to such producers until it has obtained
broadcast commitments from a substantial number of television stations. As a
result of this strategy and the success of its existing syndication proper-
ties, to date, King World has funded substantially all programming acqui-
sition,<PAGE>
<PAGE>
development and production costs and advances from its operations.
The distribution of television programming is highly competitive and
the Company may be obliged to offer, among other things, guarantees and cash
advances to acquire, renew or extend distribution rights. Under the terms of
the Company's agreement with Harpo, the Company has the exclusive right, and
has agreed, to distribute episodes of THE OPRAH WINFREY SHOW produced through
the 1999-2000 television season, subject to Harpo's and Ms. Winfrey's right to
decline to produce and host the show in any season after the 1995-1996 season.
To date, Harpo and Ms. Winfrey have committed to produce and host the show
through the 1997-1998 broadcast season. There can be no assurances that Harpo
and Ms. Winfrey will elect to produce and host the show for seasons beyond the
1997-1998 season. Their failure to do so would have a material adverse effect
on the Company's results of operations.
Under the terms of its agreement with Harpo, the Company has agreed,
among other things, to pay Harpo production fees and to guarantee
participation payments to Harpo at levels which are substantially higher than
those that were in effect prior to the 1995-1996 season. In addition, in the
1997-1998 season and thereafter, profit sharing arrangements between Harpo and
the Company currently in effect will terminate and the Company will instead
receive distribution fees based on a percentage of gross revenues derived from
the series. These arrangements are less favorable to the Company than those
contained in prior agreements between the Company and Harpo and, unless offset
by significant increases in license fees paid by television stations for the
series in forthcoming seasons, increased barter revenues from the series,
and/or increased foreign revenues from the series, the Company's net profits
and cash flow derived from THE OPRAH WINFREY SHOW will decline in the coming
years even if Harpo and Ms. Winfrey elect to produce and host the show beyond
the 1997-1998 season.
On January 2, 1996, the Company paid Harpo, the producer of THE OPRAH
WINFREY SHOW, a $65 million advance against its minimum participation payments
for the 1996-1997 broadcast season. This advance was fully recouped as of May
31, 1997. In addition, on January 2, 1996, the Company made an advance to
Harpo of $65 million against Harpo's minimum participation payments for the
1997-1998 broadcast season, none of which had been recouped as of May 31,
1997. Based on the license agreements in place for the 1997-1998 season, the
Company believes that revenues from the series will be sufficient to enable
the Company to recoup the advance for such season. Such advance is refundable
to the Company by Harpo and Ms. Winfrey if King World terminates such<PAGE>
<PAGE>
license agreements with Harpo due to Harpo's failure to deliver episodes of
THE OPRAH WINFREY SHOW.
From time to time, the Company has used cash reserves and/or borrowed
funds to make acquisitions of and investments in broadcast and related proper-
ties in the entertainment field, to repurchase shares of its Common Stock and
to fund development, production and promotion of new programming. The Company
continues to evaluate opportunities in these areas, and may seek to raise
capital in public or private securities markets to finance
such activities if it considers it advantageous to do so. The
Company recently formed a new division, King World Ventures, which
has primary responsibility for the Company's investment and acqui-
sition program including analysis of new business opportunities.
On April 15, 1997, the Company announced that the Board
of Directors had approved a program to repurchase up to 5,000,000
shares of its Common Stock from time to time in the open market
and in privately negotiated transactions. Through May 31, 1997,
662,800 shares of Common Stock were repurchased in open market
transactions for aggregate consideration of approximately $24.7
million or approximately $37.30 per share. Through June 23,
1997, 971,000 shares of Common Stock were repurchased in open
market transactions for aggregate consideration of approximately
$36.2 million or approximately $37.20 per share. The Company
intends to continue to repurchase shares of Common Stock in the
open market and in privately negotiated transactions if and when
it deems it advantageous to do so. Purchases under the share
repurchase program will be financed out of the Company's avail-
able cash and liquid investments.
On May 16, 1997, a special dividend distribution of
$2.00 per share was paid to stockholders of record on April 25,
1997. The Company used approximately $74.8 million of its cash
and liquid investments to pay the special dividend. The Company
has no present plan to declare additional cash dividends in the
forseeable future.
PART II - OTHER INFORMATION
Item 5. Other Information
_________________
On June 16, 1997, the Company announced the appointment
of Steven A. LoCascio as Senior Vice President and Chief Finan-
cial Officer.
On June 17, 1997, the Company announced the appointment
of Jules Haimovitz as President and Chief Operating Officer,
effec-<PAGE>
<PAGE>
tive June 23, 1997. Upon Mr. Haimovitz's appointment, Michael
King assumed the position of Vice Chairman. Mr. King will
continue to serve as the Chief Executive Officer of King World.
On June 25, 1997, the Board of Directors adopted
certain amendments to the Company's By-laws. Such amendments
include the following: (i) Section 1.1 of Article I (Annual
Meetings) was amended to provide that written notice of any pro-
posal or other business to be brought before an annual meeting by
a stockholder must be given to the Secretary of the Company not
more than 120 days nor less than 90 days in advance of the
anniversary date of the immediately preceding annual meeting, and
to specify the contents of such a notice; (ii) a new Section 1.8
was added to Article I (Action By Written Consent), to specify
the procedures by which action may be taken by the stockholders
of the Company by written consent, including the manner in which
the written consent procedure may be initiated and conducted and
the results thereof determined; (iii) Section 1.8 of Article I
was redesignated as Section 1.9 (Fixing Date for Determination of
Stockholders of Record) and amended to provide, among other
things, for the fixing of the record date in connection with a
stockholder action by written consent; (iv) Section 1.9 of
Article I was redesignated as Section 1.10; and (v) Section 2.3
of Article II (Notification of Nominations) was amended to
provide that written notice of a nomination for election as a
director by a stockholder must be given to the Secretary of the
Company (a) with respect to an annual meeting, not more than
120 days nor less than 90 days in advance of the anniversary date
of the immediately preceding annual meeting, and (b) with respect
to an election held at a special meeting, not later than the
close of business on the seventh day following the date on which
notice of the meeting is given.
The foregoing description of the amended By-law provi-
sions does not purport to be complete and is qualified in its
entirety by reference to applicable provisions of the By-laws of
the Company (as amended and restated as of June 25, 1997) which
are filed as Exhibit 3.1 to this Report and are incorporated
herein by reference.
Item 6. Exhibits and Reports on Form 8-K
________________________________
(a) Exhibits:
________
Exhibit
Number Description
______ ___________<PAGE>
<PAGE>
3.1 By-laws of the Company (amended and restated as of June 25,
1997)
10.1 Employment Agreement, dated June 5, 1997, between the Compa-
ny and Steven A. LoCascio
10.2 Employment Agreement, dated June 6, 1997, between the Compa-
ny and Jules Haimovitz
(b) Reports on Form 8-K
___________________
1. The Company filed a Report on Form 8-K on April 15,
1997 in which it reported that the Board of Directors had
declared the special dividend and had approved the stock
repurchase plan.
2. The Company filed a Report on Form 8-K on May 13, 1997
in which it reported that on March 24, 1997, the Company
filed an action in California Superior Court, Los Angeles
County, against the two subsidiaries of Sony Pictures Enter-
tainment that produce "WHEEL OF FORTUNE" and JEOPARDY!".
The Company further reported that on May 8, 1997 the defen-
dants filed an answer and countercomplaint.<PAGE>
<PAGE>
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 autho-
rized.
KING WORLD PRODUCTIONS, INC.
By: /s/ Steven A. LoCascio
___________________________________
Steven A. LoCascio
Senior Vice President and
Chief Financial Officer
and on behalf of the Registrant
June 26, 1997<PAGE>
<PAGE>
EXHIBIT INDEX
_____________
Exhibit
No. Description
_______ ___________
3.1 By-laws of the Company (amended and restated as of June
25, 1997)
10.1 Employment Agreement, dated June 5, 1997, between the
Company and Steven A. LoCascio
10.2 Employment Agreement, dated June 6, 1997, between the
Company and Jules Haimovitz
Exhibit 3.1
BY-LAWS
OF
KING WORLD PRODUCTIONS, INC.
(Amended and Restated as of June 25, 1997)
ARTICLE I
Stockholders
Section 1.1 ANNUAL MEETINGS. (a) An annual meeting of stock-
holders shall be held for the election of directors at such date, time and
place either within or without the State of Delaware as may be designated
by the Board of Directors from time to time. At any such annual meeting
any business properly brought before the meeting may be transacted.
(b) To be properly brought before an annual meeting, business
must be (i) specified in the notice of the meeting (or any supplement
thereto) given by or at the direction of the chairman of the meeting or
Board of Directors, (ii) otherwise properly brought before the meeting by
or at the direction of the chairman of the meeting or the Board of Direc-
tors or (iii) otherwise properly brought before an the meeting by a
stockholder. For business to be properly brought before an annual meeting
by a stockholder, the stockholder must have given written notice thereof,
either by personal delivery or by United States mail, postage prepaid, to
the Secretary of the Corporation, not more than 120 days or less than 90
days, in advance of the anniversary date of the immediately preceding
annual meeting. Any such notice shall set forth as to each matter the
stockholder proposes to bring before the annual meeting (i) a brief
description of the business desired to be brought before the meeting and
the reasons for conducting such business at the meeting and in the event
that such business includes a proposal to amend either the Certificate of
incorporation or By-laws of the Corporation, the language of the proposed
amendment, (ii) the name and address of the stockholder proposing such
business, (iii) a representation that the stockholder is a holder of record
of stock of the Corporation entitled to vote at such meeting and intends to
appear in person or by such meeting intends to appear in person or by proxy
at the Meeting to propose such business, (iv) any material interest of the
stockholder in such business and (v) if the stockholder intends to solicit
proxies in support of such stockholder's proposal, a representation to that
effect. No business shall be conducted at an annual meeting of stock-
holders except in accordance with this Section 1.1(b), and chairman of the
meeting may refuse to permit any business to be brought before an annual
meeting without compliance with the foregoing procedures or if the stock-
holder solicits proxies in support of such stockholder's proposal without
such stockholder having made the required by clause (v) of the preceding
sentence.
<PAGE>
Section 1.2 SPECIAL MEETINGS. Except as otherwise required by law
and subject to the rights of the holders of any class or series of stock
having a preference over the Common Stock as to dividends or upon liquida-
tion, special meetings of the stockholders for any purpose or purposes may
be called only by the Chairman of the Board, the President, or a majority
of the entire Board of Directors. Only such business as is specified in
the notice of any special meeting of the stockholders shall come before
such meeting.
Section 1.3 NOTICE OF MEETINGS. Whenever stockholders are
required or permitted to take any action at a meeting, a written notice of
the meeting shall be given which shall state the place, date and hour of
the meeting, and, in the case of a special meeting, the purpose or purposes
for which the meeting is called. Unless otherwise provided by law, the
written notice of any meeting shall be given not less than ten nor more
than sixty days before the date of the meeting to each stockholder entitled
to vote at such meeting. If mailed, such notice shall be deemed to be
given when deposited in the United States mail, postage prepaid, directed
to the stockholder at such stockholder's address as it appears on the
records of the Corporation.
Section 1.4 ADJOURNMENTS. Any meeting of stockholders, annual or
special, may adjourn from time to time to reconvene at the same or some
other place, and notice need not be given of any such adjourned meeting if
the time and place thereof are announced at the meeting at which the
adjournment is taken. At the adjourned meeting the Corporation may
transact any business which
might have been transacted at the original meeting. If the adjournment is
for more than thirty days, or if after the adjournment a new record date is
fixed for the adjourned meeting, a notice of the adjourned meeting shall be
given to each stockholder of record entitled to vote at the meeting.
Section 1.5 QUORUM. At each meeting of stockholders, except where
otherwise provided by law or the certificate of incorporation or these By-
laws, the holders of a majority of the outstanding shares of each class of
stock entitled to vote at the meeting, present in person or represented by
proxy, shall constitute a quorum. For purposes of the foregoing, two or
more classes or series of stock shall be considered a single class if the
holders thereof are entitled to vote together as a single class at the
meeting. In the absence of a quorum the stockholders so present may, by
majority vote, adjourn the meeting from time to time in the manner provided
by Section 1.4 of these By-laws until a quorum shall attend. Shares of its
own capital stock belonging on the record date for the meeting to the
Corporation or to another corporation, if a majority of the shares entitled
to vote in the election of directors of such other corporation is held,
directly or indirectly, by the Corporation, shall neither be entitled to
vote nor be counted for quorum purposes; provided, however, that the
foregoing shall not limit the right of the Corporation to vote stock,
including but not limited to its own stock, held by it in a fiduciary
capacity.
<PAGE>
Section 1.6 ORGANIZATION. Meetings of stockholders shall be
presided over by the Chairman of the Board, if any, or in the absence of
the Chairman of the Board by the Vice Chairman of the Board, if any, or in
the absence of the Vice Chairman of the Board by the President, or in the
absence of the President by a Vice President, or in the absence of the
foregoing persons by a chairman designated by the Board of Directors, or in
the absence of such designation by a chairman chosen at the meeting. The
Secretary, or in the absence of the Secretary an Assistant Secretary, shall
act as secretary of the meeting, but in the absence of the Secretary and
any Assistant Secretary the chairman of the meeting may appoint any person
to act as secretary of the meeting.
Section 1.7 VOTING; PROXIES. Unless otherwise provided in the
Certificate of Incorporation, each stockholder entitled to vote at any
meeting of stockholders shall be entitled to one vote for each share of
stock held by such stockholder which has voting power upon the matter in
question. Each stockholder entitled to vote at a meeting of stockholders
may authorize another person or persons to act for such stockholder by
proxy, but no such proxy shall be voted or acted upon after three years
from its date, unless the proxy provides for a longer period. A duly
executed proxy shall be irrevocable if it states that it is irrevocable and
if, and only as long as, it is coupled with an interest sufficient in law
to support an irrevocable power. A stockholder may revoke any proxy which
is not irrevocable by attending the meeting and voting in person or by
filing an instrument in writing revoking the proxy or another duly executed
proxy bearing a later date with the Secretary of the Corporation. Unless
required by law or determined by the chairman of the meeting to be advis-
able, the vote on any matter, including the election of directors, need not
be by written ballot. In the case of a vote by written ballot, each ballot
shall be signed by the stockholder voting, or by such stockholder's proxy,
and shall state the number of shares voted. Either the Board of Directors
or, in the absence of a designation of inspectors by the Board, the
chairman of any meeting of stockholders may, in its or such person's
discretion, appoint two or more inspectors to act at any meeting of
stockholders. Such inspectors shall perform such duties as shall be
specified by the Board or the chairman of the meeting. Inspectors need not
be stockholders. No director or nominee for the office of director shall be
appointed such inspector. At all meetings of stockholders for the election
of directors a plurality of the votes cast shall be sufficient to elect.
With respect to other matters, unless otherwise provided by law or by the
Certificate of Incorporation or these By-laws, the affirmative vote of the
holders of a majority of the shares of all classes of stock present in
person or represented by proxy at the meeting and entitled to vote on the
subject matter shall be the act of the stockholders. Where a separate vote
by class is required, the affirmative vote of the holders of a majority of
the shares of each class present in person or represented by proxy at the
meeting shall be the act of such class, except as otherwise provided by law
or by the Certificate of Incorporation or these By-laws.
Section 1.8 ACTION BY WRITTEN CONSENT. (a) Unless otherwise
provided in the Certificate of Incorporation, any action required to be
<PAGE>
taken at any annual or special meeting of stockholders of the Corporation,
or any action which may be taken at any annual or special meeting of such
stockholders, may be taken without a meeting, without prior notice and
without a vote if a consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than
the minimum number of votes that would be necessary to authorize or take
such action at a meeting at which all shares entitled to vote thereon were
present and voted. Prompt notice of the taking of the corporate action
without a meeting by less than unanimous written consent shall be given to
those stockholders who have not consented in writing.
(b) Consents to corporate action shall be valid for a maximum of
60 days after the date of the earliest dated consent delivered to the
Corporation in the manner provided in Section 228(c), of the Delaware
General Corporation Law. Consents may be revoked by written notice (i) to
the Corporation, (ii) to stockholder or stockholder soliciting consents or
soliciting revocations in opposition to action by consent (the "Soliciting
Stockholders"), or (iii) to a proxy solicitor or other agent designated by
the Corporation or the Soliciting Stockholders.
(c) Within ten business days after receipt of the earliest dated
consent delivered to the Corporation in the manner provided in Section
228(c) of the Delaware General Corporation Law or the determination by the
Board of Directors of the Corporation that the Corporation should seek
corporate action by written consent, as the case may be, the Secretary of
the Corporation shall engage nationally recognized the purpose of perform-
ing a ministerial review of the validity of the consents and revocations.
The cost of retaining inspectors of elections shall be borne by the
Corporation.
(d) Following appointment of the inspectors, consents and
revocations shall be delivered to the inspectors upon receipt by the
Corporation, the Soliciting Stockholder or their proxy solicitors or other
designated agents. As soon as practicable following the earlier of (i) the
receipt by the inspectors, a copy of which shall be delivered to the
Corporation, of any written demand by the Soliciting Stockholders, or (ii)
60 days after the date of the earliest dated consent delivered to the
Corporation in the manner provided in Section 228(c) of the Delaware
General Corporation Law, the inspectors shall issue a preliminary report to
the Corporation and the preliminary report to the Corporation and the
Soliciting Stockholders stating the number of valid and unrevoked consents
has been obtained to authorize or take the action specified in the con-
sents.
(e) Unless the Corporation and the Soliciting Stockholders shall
agree to a shorter or longer period, the Corporation and the Soliciting
Stockholders shall have 48 hours to review the consents and revocations and
to advise the inspectors and the opposing party in writing as to whether
they intend to challenge the preliminary report of the inspectors. If no
written notice of an intention to challenge the preliminary report is
<PAGE>
received within 48 hours after the inspectors' issuance of the preliminary
report, the inspectors shall issue to the Corporation and the Soliciting
Stockholders their final report containing the information from the
inspectors' determination with respect to whether the requisite number of
valid and unrevoked consents was obtained to authorize and take the action
specified in the consents. If the Corporation or the Soliciting Stockhold-
ers issue written notice of an intention to challenge the inspectors'
preliminary report within 48 hours after the issuance of that report, a
challenge session shall be scheduled by the inspectors as promptly as
practicable. Following completion of the challenge session, the inspectors
shall as promptly as practicable issue their final report to the Soliciting
Stockholders and the Corporation, which report shall contain the informa-
tion included in the preliminary report, plus any change in the vote total
as a result of the challenge and a certification of whether the requisite
number of valid and unrevoked consents was obtained to authorize or take
the action specified in the consents.
Section 1.9 FIXING DATE FOR DETERMINATION OF STOCKHOLDERS OF
RECORD. In order that the Corporation may determine the stockholders
entitled to notice of or to vote at any meeting of stockholders or any
adjournment thereof, or entitled to receive payment of any dividend or
other distribution or allotment of any rights, or entitled to exercise any
rights in respect of any change, conversion or exchange of stock or for the
purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than sixty nor less than
ten days before the date of such meeting, nor more than sixty days prior to
any other action. If no record date is fixed, (1) the record date for
determining stockholders entitled to notice of or to vote at a meeting of
stockholders shall be at the close of business on the day next preceding
the day on which notice is given, or, if notice is waived, at the close of
business on the day next preceding the day on which the meeting is held,
and (2) the record date for determining stockholders for any other purpose
shall be at the close of business on the day on which the Board adopts the
resolution relating thereto. A determination of stockholders of record
entitled to notice of or to vote at a meeting of stockholders shall apply
to any adjournment of the meeting; provided, however, that the Board may
fix a new record date for the adjourned meeting.
Notwithstanding any inconsistent provision which may be contained
in these By-Laws, in order that the Corporation may determine the stock-
holders entitled to consent to corporate action in writing without a
meeting, the Board of Directors may fix a record date, which record date
shall not precede the date on which the resolution fixing the record date
is adopted by the Board of Directors, and which date shall not be more than
ten days after the date upon which the resolution fixing the record date is
adopted by the Board of Directors. Any stockholder of record seeking to
have the stockholders authorize or take corporate action by written consent
shall, by written notice to the Secretary of the Corporation, request the
Board of Directors to fix a record date. The Board of Directors shall
thereafter promptly, but in all events within ten days after the date on
which such a request is received, adopt a resolution fixing the record
date. If no record date has been fixed by the Board of Directors within
ten days of the date upon which such a request is received, the record date
for determining stockholders entitled to consent to corporate action in
writing without a meeting, when no prior action by the Board of Directors
is required by applicable law, shall be the first date on which a signed
written consent setting forth the action taken or proposed to be taken is
delivered to the Corporation by delivery to its registered office in the
State of Delaware, its principal place of business, or any officer or agent
of the Corporation having custody of the book in which proceedings of
<PAGE>
stockholders' meetings are recorded, to the attention of the Secretary of
the Corporation. Delivery shall be by hand or by certified a or registered
mail, return receipt requested. If no record date has been fixed by the
Board of Directors and prior action in writing without a meeting shall be
at the close of business on the date on which the Board of Directors is
required by applicable law, the record date for determining stockholders
entitle to consent to corporate action in writing without a meeting shall
be at the close of business on the date on which the Board of Directors
adopts the resolution taking such prior action."
Section 1.10 LIST OF STOCKHOLDERS ENTITLED TO VOTE. The Secre-
tary shall prepare and make, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each
stockholder. Such list shall be open to the examination of any stockhold-
er, for any purpose germane to the meeting, during ordinary business hours,
for a period of at least ten days prior to the meeting, either at a place
within the city where the meeting is to be held, which place shall be
specified in the notice of the meeting, or, if not so specified, at the
place where the meeting is to be held. The list shall also be produced and
kept at the time and place of the meeting during the whole time thereof and
may be inspected by any stockholder who is present.
ARTICLE II
Board of Directors
Section 2.1 GENERAL POWERS. The business and affairs of the
Corporation shall be managed by or under the direction of the Board of
Directors, which may exercise all such powers of the corporation and do all
such lawful acts and things as are not by law or by the certificate of
incorporation of the corporation directed or required to be exercised or
done by the stockholders.
Section 2.2 NUMBER, QUALIFICATION AND ELECTION. Except as
otherwise fixed by or pursuant to the provisions of Article IV of the
Certificate of Incorporation of the Corporation relating to the rights of
the holders of any class or series of stock having preference over the
Common Stock as to dividends or upon liquidation, the number of the
directors of the Corporation shall be seven (7), but, by vote of a majority
of the entire Board of Directors, the number thereof may be increased
without limit, or decreased to not less than three (3), by amendment to
this Section 2.2.
The directors, other than those who may be elected by the holders
of shares of any class or series of stock having a preference over the
Common Stock of the Corporation as to dividends or upon liquidation
<PAGE>
pursuant to the terms of Article IV of the Certificate of Incorporation or
any resolution or resolutions providing for the issuance of such stock
adopted by the Board, shall be classified, with respect to the time for
which they severally hold office, into three classes as follows: one class
of two (2) directors shall be originally elected for a term expiring at the
annual meeting of stockholders to be held in 1986, another class of two (2)
directors shall be originally elected for a term expiring at the annual
meeting of stockholders to be held in 1987 and another class of three (3)
directors shall be originally elected for a term expiring at the annual
meeting of stockholders to be held in 1988, with each class to hold office
until its successors are elected and qualified. At each annual meeting of
the stockholders of the Corporation, the successors of the class of
directors whose term expires at that meeting shall be elected to hold
office for a term expiring at the annual meeting of stockholders held in
the third year following the year of their election.
Each director shall be a least 21 years of age. Directors need
not be stockholders of the Corporation.
Subject to the rights of the holders of any class or series of
stock having a preference over the Common Stock of the Corporation as to
dividends or upon liquidation, at each annual meeting of the stockholders
there shall be elected the directors of the class the term of office of
which shall then expire.
Section 2.3 NOTIFICATION OF NOMINATIONS. Subject to the rights
of the holders of any class or series of stock having a preference over the
Common Stock as to dividends or upon liquidation, nominations for the
election of directors may be made by the Board of Directors or by any
stockholder entitled to vote for the election of directors. Any stockhold-
er entitled to vote for the election of directors at a meeting may nominate
persons for election as directors only if written notice of such
stockholders' intent to make such nomination is given, either by personal
delivery or by United States mail, Postage prepaid, to the Secretary of the
Corporation not later than (i) with respect to an election to be held at an
annual meeting of stockholders, not more than 120-days or less than 90 days
in advance of the anniversary date of the immediately preceding annual
meeting, and (ii) with respect to an election to be held at a special
meeting of stockholders for the election of directors, the close of
business an the seventh day following the date on which notice of such
meeting is first given to stockholders. Each such notice shall set forth
(a) the name and address of the stockholder who intends to make the
nomination and of the person or, persons to be nominated, (b) a representa-
tion that the stockholder is a holder of record of stock of the Corporation
entitled to vote at such meeting and intends to appear in person or by
proxy at the meeting to nominate the person or persons specified in the
notice, (c) a description of all arrangements or understandings between the
stockholder and each nominee and any other person or persons (naming such
person or persons) pursuant to which the nomination or nominations are to
be made by the stockholder, (d) such other information regarding each
<PAGE>
nominee proposed by such stockholder as would have been required to be
included in a proxy statement filed pursuant to the proxy rules of the
Securities and Exchange Commission had each nominee be nominated, or
intended to be nominated, by the Board of Directors; (e) the consent of
each nominee to serve as a director of the corporation if so elected and
(f) if the stockholder intends to solicit proxies in support of such
stockholder's nominee(s), a representation to that effect. The chairman of
the meeting may refuse to acknowledge the nomination of any person which
was not made in accordance with the foregoing procedure or if the stock-
holder solicits proxies in support of such stockholder's nominee(s) without
such stockholder having made the representation required by clause (f) of
the preceding sentence.
Section 2.4 REGULAR MEETINGS. Regular meetings of the Board of
Directors may be held at such places within or without the State of
Delaware and at such times as the Board may from time to time determine,
and if so determined notice thereof need not be given.
Section 2.5 SPECIAL MEETINGS. Special meetings of the Board of
Directors may be held at any time or place within or without the State of
Delaware whenever called by the Chairman of the Board, if any, by the Vice
Chairman of the Board, if any, by the President or by a majority of the
members of the Board. Reasonable notice thereof shall be given by the
person or persons calling the meeting.
Section 2.6 PARTICIPATION IN MEETINGS BY CONFERENCE TELEPHONE
PERMITTED. Unless otherwise restricted by the Certificate of Incorporation
or these By-laws, members of the Board of Directors, or any committee
designated by the Board, may participate in a meeting of the Board or of
such committee, as the case may be, by means of conference telephone or
similar communications equipment by means of which all persons participat-
ing in the meeting can hear each other, and participation in a meeting
pursuant to this By-law shall constitute presence in person at such meeting.
Section 2.7 QUORUM; VOTE REQUIRED FOR ACTION. Except as other-
wise provided by law, the Certificate of Incorporation or these By-laws, at
any meeting of the Board of Directors a majority of the entire Board shall
constitute a quorum for the transaction of business and, except as so
provided, the vote of a majority of the directors present at a meeting at
which a quorum is present shall be the act of the Board. In case at any
meeting of the Board a quorum shall not be present, the members of the
Board present may adjourn the meeting from time to time until a quorum
shall attend. At any adjourned meeting at which a quorum is present, any
business may be transacted which might have been transacted at the meeting
originally called.
Section 2.8 ORGANIZATION. Meetings of the Board of Directors
shall be presided over by the Chairman of the Board, if any, or in the
absence of the Chairman of the Board by the Vice Chairman of the Board, if
any, or in the absence of the Vice Chairman of the Board by the President,
<PAGE>
or in their absence by a chairman chosen at the meeting. The Secretary, or
in the absence of the Secretary an Assistant Secretary, shall act as
secretary of the meeting, but in the absence of the Secretary and any
Assistant Secretary the chairman of the meeting may appoint any person to
act as secretary of the meeting.
Section 2.9 ACTION BY DIRECTORS WITHOUT A MEETING. Any action
required or permitted to be taken at any meeting of the Board of Directors,
or of any committee thereof, may be taken without a meeting if all members
of the Board or of such committee, as the case may be, consent thereto in
writing, and the writing or writings are filed with the minutes of proceed-
ings of the Board or committee.
Section 2.10 RESIGNATIONS. Any director of the Company may at
any time resign by giving written notice to the Board of Directors, the
Chairman of the Board, the President or the Secretary of the Corporation.
Such resignation shall take effect at the time specified therein or, if the
time be not specified, upon receipt thereof; and, unless otherwise speci-
fied therein, the acceptance of such resignation shall not be necessary to
make it effective.
Section 2.11 VACANCIES. Subject to the rights of the holders of
any class or series of stock having a preference over the Common Stock of
the Corporation as to dividends or upon liquidation, any vacancies on the
Board of Directors resulting from death, resignation, removal or other
cause shall only be filled by the affirmative vote of a majority of the
remaining directors then in office, even though less than a quorum of the
Board of Directors, or by a sole remaining director, and newly created
directorships resulting from any increase in the number of directors shall
be filled by the Board, or if not so filled, by the stockholders at the
next annual meeting thereof or at a special meeting called for that purpose
in accordance with 1.2 of these By-laws. Any director elected in accor-
dance with the preceding sentence shall hold office for the remainder of
the full term of the class of directors in which the new directorship was
created or the vacancy occurred and until such director's successor shall
have been elected and qualified.
Section 2.12 COMPENSATION OF DIRECTORS. The Board of Directors
shall have the authority to fix the compensation of directors.
ARTICLE III
Committees
Section 3.1 COMMITTEES. The Board of Directors may, by resolu-
tion passed by a majority of the whole Board, designate one or more
committees, each committee to consist of one or more of the directors of
the Corporation. The Board may designate one or more directors as alter-
nate members of any Committee, who may replace any absent or disqualified
member at any meeting of the committee. In the absence or disqualification
of a member of a committee, the member or members thereof present at any
<PAGE>
meeting and not disqualified from voting, whether or not such member or
members constitute a quorum, may unanimously appoint another member of the
Board to act at the meeting in place of any such absent or disqualified
member. Any such committee, to the extent
provided in the resolution of the Board, shall have and may exercise all
the powers and authority of the Board in the management of the business and
affairs of the Corporation, and may authorize the seal of the Corporation
to be affixed to all papers which may require it; but no such committee
shall have power or authority in reference to amending the certificate of
incorporation, adopting an agreement of merger or consolidation, recom-
mending to the stockholders the sale, lease or exchange of all or substan-
tially all the Corporation's property and assets, recommending to the
stockholders a dissolution of the Corporation or a revocation of dissolu-
tion, removing or indemnifying directors or amending these By-laws; and,
unless the resolution expressly so provides, no such committee shall have
the power or authority to declare a dividend or to authorize the issuance
of stock. The Board shall have power at any time to change the membership
of any committee, to fill all vacancies in it and to discharge it, either
with or without cause.
Section 3.2 COMMITTEE RULES. Unless the Board of Directors
otherwise provides, each committee designated by the Board may adopt, amend
and repeal rules for the conduct of its business. In the absence of a
provision by the Board or a provision in the rules of such committee to the
contrary, a majority of the entire authorized number of members of such
committee shall constitute a quorum for the transaction of business, the
vote of a majority of the members present at a meeting at the time of such
vote if a quorum is then present shall be the act of such committee, and in
other respects each committee shall conduct its business in the same manner
as the Board conducts its business pursuant to Article II of these By-laws.
ARTICLE IV
Officers
Section 4.1 OFFICERS; ELECTION. As soon as practicable after the
annual meeting of stockholders in each year, the Board of Directors shall
elect a President and a Secretary, and it may, if it so determines, elect
from among its members a Chairman of the Board and a Vice Chairman of the
Board. The Board may also elect one or more Vice Presidents, one or more
Assistant Vice Presidents, one or more Assistant Secretaries, a Treasurer
and one or more Assistant Treasurers and such other officers as the Board
may deem desirable or appropriate and may give any of them such further
designations or alternate titles as it considers desirable. Any number of
offices may be held by the same person.
Section 4.2 TERM OF OFFICE; RESIGNATION; REMOVAL; VACANCIES.
Except as otherwise provided in the resolution of the Board of Directors
electing any officer, each officer shall hold office until the first
meeting of the Board after the annual meeting of stockholders next succeed-
ing his or her election and until his or her successor is elected and
<PAGE>
qualified or until his or her earlier resignation or removal. Any officer
may resign at any time upon written notice to the Board or to the President
or the Secretary of the Corporation. Such resignation shall take effect at
the time specified therein, and unless otherwise specified therein no
acceptance of such resignation shall be necessary to make it effective.
The Board may remove any officer with or without cause at any time. Any
such removal shall be without prejudice to the contractual rights of such
officer, if any, with the Corporation, but the election of an officer shall
not of itself create contractual rights. Any vacancy occurring in any
office of the Corporation by death, resignation, removal or otherwise may
be filled for the unexpired portion of the term by the Board at any regular
or special meeting.
Section 4.3 CHAIRMAN OF THE BOARD. The Chairman of the Board, if
any, shall preside at all meetings of the Board of Directors and of the
stockholders at which he or she shall be present and shall have and may
exercise such powers as may, from time to time, be assigned to him or her
by the Board and as may be provided by law.
Section 4.4 VICE CHAIRMAN OF THE BOARD. In the absence of the
Chairman of the Board, the Vice Chairman of the Board, if any, shall
preside at all meetings of the Board of Directors and of the stockholders
at which he or she shall be present and shall have and may exercise such
powers as may, from time to time, be assigned to him or her by the Board
and as may be provided by law.
Section 4.5 PRESIDENT. In the absence of the Chairman of the
Board and Vice Chairman of the Board, the President shall preside at all
meetings of the Board of Directors and of the stockholders at which he or
she shall be present. The President shall be the chief executive officer
and shall have general charge and supervision of the business of the
Corporation and, in general, shall perform all duties incident to the
office of president of a corporation and such other duties as may, from
time to time, be assigned to him or her by the Board or as may be provided
by law.
Section 4.6 VICE PRESIDENTS. The Vice President or Vice Presi-
dents, at the request or in the absence of the President or during the
President's inability to act, shall perform the duties of the President,
and when so acting shall have the powers of the President. If there be
more than one Vice President, the Board of Directors may determine which
one or more of the Vice Presidents shall perform any of such duties; or if
such determination is not made by the Board, the President may make such
determination; otherwise any of the Vice Presidents may perform any of such
duties. The Vice President or Vice Presidents shall have such other powers
and shall perform such other duties as may, from time to time, be assigned
to him or her or them by the Board or the President or as may be provided
by law.
Section 4.7 SECRETARY. The Secretary shall have the duty to
record the proceedings of the meetings of the stockholders, the Board of
<PAGE>
Directors and any committees in a book to be kept for that purpose, shall
see that all notices are duly given in accordance with the provisions of
these By-laws or as required by law, shall be custodian of the records of
the Corporation, may affix the corporate seal to any document the execution
of which, on behalf of the Corporation, is duly authorized, and when so
affixed may attest the same, and, in general, shall perform all duties
incident to the office of secretary of a corporation and such other duties
as may, from time to time, be assigned to him
or her by the Board or the President or as may be provided by law.
Section 4.8 TREASURER. The Treasurer shall have charge of and be
responsible for all funds, securities, receipts and disbursements of the
Corporation and shall deposit or cause to be deposited, in the name of the
Corporation, all moneys or other valuable effects in such banks, trust
companies or other depositories as shall, from time to time, be selected by
or under authority of the Board of Directors. If required by the Board,
the Treasurer shall give a bond for the faithful discharge of his or her
duties, with such surety or sureties as the Board may determine. The
Treasurer shall keep or cause to be kept full and accurate records of all
receipts and disbursements in books of the Corporation, shall render to the
President and to the Board, whenever requested, an account of the financial
condition of the Corporation, and, in general, shall perform all the duties
incident to the office of treasurer of a corporation and such other duties
as may, from time to time, be assigned to him or her by the Board or the
President or as may be provided by law.
Section 4.9 OTHER OFFICERS. The other officers, if any, of the
Corporation shall have such powers and duties in the management of the
Corporation as shall be stated in a resolution of the Board of Directors
which is not inconsistent with these By-laws and, to the extent not so
stated, as generally pertain to their respective offices, subject to the
control of the Board. The Board may require any officer, agent or employee
to give security for the faithful performance of his or her duties.
ARTICLE V
Stock
Section 5.1 CERTIFICATES. Every holder of stock in the Corpora-
tion shall be entitled to have a certificate signed by or in the name of
the Corporation by the Chairman or Vice Chairman of the Board of Directors,
if any, or the President or a Vice President, and by the Treasurer or an
Assistant Treasurer, or the Secretary or an Assistant Secretary, of the
Corporation, certifying the number of shares owned by such holder in the
Corporation. Any of the signatures on the certificate may be a facsimile.
In case any officer, transfer agent or registrar who has signed or whose
facsimile signature has been placed upon a certificate shall have ceased to
be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the Corporation with the same effect as if such
person were such officer, transfer agent or registrar at the date of issue.
<PAGE>
Section 5.2 LOST, STOLEN OR DESTROYED STOCK CERTIFICATES;
ISSUANCE OF NEW CERTIFICATES. The Corporation may issue a new certificate
of stock in the place of any certificate theretofore issued by it, alleged
to have been lost, stolen or destroyed, and the Corporation may require the
owner of the lost, stolen or destroyed certificate, or such owner's legal
representative, to give the Corporation a bond in such sum and with such
surety or sureties as the Corporation may direct sufficient to indemnify
the Corporation and its transfer agents or registrars against any claim
that may be made against it on account of the alleged loss, theft or
destruction of any such certificate or the issuance of such new certifi-
cate.
Section 5.3 TRANSFER OF SHARES. Transfers of shares of stock of
each class of the Corporation shall be made only on the books of the
Corporation by the holder thereof, or by such holder's attorney thereunto
authorized by a power of attorney duly executed and filed with the Secre-
tary of the Corporation or a transfer agent for such stock, if any, and on
surrender of the certificate or certificates for such shares properly
endorsed or accompanied by a duly executed stock transfer power and the
payment of all taxes thereon. The person in whose name shares stand on the
books of the Corporation shall be deemed the owner thereof for all purposes
as regards the Corporation; provided, however, that whenever any transfer
of shares shall be made for collateral security and not absolutely, and
written notice thereof shall be given to the Secretary or to such transfer
agent, such fact shall be stated in the entry of the transfer. No transfer
of shares shall be valid as against the Corporation, its stockholders and
creditors for any purpose, except to render the transferee liable for the
debts of the Corporation to the extent provided by law, until it shall have
been entered in the stock records of the Corporation by an entry showing
from and to whom transferred.
ARTICLE VI
Miscellaneous
Section 6.1 FISCAL YEAR. The fiscal year of the Corporation
shall be determined by the Board of Directors.
Section 6.2 SEAL. The Corporation may have a corporate seal
which shall have the name of the Corporation inscribed thereon and shall be
in such form as may be approved from time to time by the Board of Direc-
tors. The corporate seal may be used by causing it or a facsimile thereof
to be impressed or affixed or in any other manner reproduced.
Section 6.3 WAIVER OF NOTICE OF MEETINGS OF STOCKHOLDERS,
DIRECTORS AND COMMITTEES. Whenever notice is required to be given by law
or under any provision of the certificate of incorporation or these By-
laws, a written waiver thereof, signed by the person entitled to notice,
whether before or after the time stated therein, shall be deemed equivalent
to notice. Attendance of a person at a meeting shall constitute a waiver
<PAGE>
of notice of such meeting, except when the person attends a meeting for the
express purpose of objecting, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the purpose of,
any regular or special meeting of the stockholders, directors, or members
of a committee of directors need be specified in any written waiver of
notice unless so required by the certificate of incorporation or these By-
laws.
Section 6.4 INDEMNIFICATION OF DIRECTORS, OFFICERS AND EMPLOYEES.
The Corporation shall indemnify to the full extent authorized by law any
person made or threatened to be made a party to any action, suit or
proceeding, whether criminal, civil, administrative or investigative, by
reason of the fact that such person or such person's testator or intestate
is or was a director, officer or employee of the Corporation or serves or
served at the request of the Corporation any other enterprise as a direc-
tor, officer or employee. For purposes of this By-law, the term "Corpora-
tion" shall include any predecessor of the Corporation and any constituent
corporation (including any constituent of a constituent) absorbed by the
Corporation in a consolidation or merger; the term "other enterprise" shall
include any corporation, partnership, joint venture, trust or employee
benefit plan; service "at the request of the Corporation" shall include
service as a director, officer or employee of the Corporation which imposes
duties on, or involves services by, such director, officer or employee with
respect to an employee benefit plan, its participants or beneficiaries; any
excise taxes assessed on a person with respect to an employee benefit plan
shall be deemed to be indemnifiable expenses; and action by a person with
respect to an employee benefit plan which such person reasonably believes
to be in the interest of the participants and beneficiaries of such plan
shall be deemed to be action not opposed to the best interests of the
Corporation.
Section 6.5 INTERESTED DIRECTORS; QUORUM. No contract or
transaction between the Corporation and one or more of its directors or
officers, or between the Corporation and any other corporation, partner-
ship, association or other organization in which one or more of its
directors or officers are directors or officers, or have a financial
interest, shall be void or voidable solely for this reason, or solely
because the director or officer is present at or participates in the
meeting of the Board of Directors or committee thereof which authorizes the
contract or transaction, or solely because his or her or their votes are
counted for such purpose, if: (1) the material facts as to his or her
relationship or interest and as to the contract or transaction are dis-
closed or are known to the Board or the committee, and the Board or commit-
tee in good faith authorizes the contract or transaction by the affirmative
votes of a majority of the disinterested directors, even though the
disinterested directors be less than a quorum; or (2) the material facts as
to his or her relationship or interest and as to the contract or transac-
tion are disclosed or are known to the stockholders entitled to vote
thereon, and the contract or transaction is specifically approved in good
faith by vote of the stockholders; or (3) the contract or transaction is
<PAGE>
fair as to the Corporation as of the time it is authorized, approved or
ratified, by the Board, a committee thereof or the stockholders. Common or
interested directors may be counted in determining the presence of a quorum
at a meeting of the Board or of a committee which authorizes the contract
or transaction.
Section 6.6 FORM OF RECORDS. Any records maintained by the
Corporation in the regular course of its business, including its stock
ledger, books of account and minute books, may be kept on, or be in the
form of, punch cards, magnetic tape, photographs, microphotographs or any
other information storage device, provided that the records so kept can be
converted into clearly legible form within a reasonable time. The Corpora-
tion shall so convert any records so kept upon the request of any person
entitled to inspect the same.
Section 6.7 AMENDMENT OF BY-LAWS. These By-laws may be amended
or repealed, and new By-laws adopted, by the Board of Directors at any
meeting thereof, provided that such proposed action in respect thereof
shall be stated in the notice of such meeting. The stockholders entitled to
vote shall have the power to adopt additional By-laws and may amend or
repeal any By-law, whether or not adopted by them, only to the extent and
in the manner provided in the Certificate of Incorporation.
Exhibit 10.1
KING WORLD CORPORATION
830 Morris Turnpike
Short Hills, New Jersey 07078
June 5, 1997
Mr. Steven LoCascio
c/o King World Corporation
830 Morris Turnpike
Short Hills, New Jersey 07078
Dear Steve:
This letter, when accepted by you, shall constitute an agreement
between you and King World Corporation (the "Company") with respect to your
employment by the Company for the Employment Period (as hereinafter
defined).
1. (a) The Company hereby agrees to employ you as Senior Vice
President and Chief Financial Officer of our affiliate King World Produc-
tions, Inc. ("King World") for the period commencing on September 1, 1997
and terminating on August 31, 1998 (the "Employment Period"). You hereby
agree to accept such employment, to diligently, faithfully and competently
perform such services as shall from time to time be reasonably assigned to
you by the Company's or King World's Board of Directors or King World's
Chairman of the Board, Chief Executive Officer or Chief Operating Officer,
and to diligently, faithfully and competently devote your entire business
time, skill and attention to the performance of your duties and responsi-
bilities to the Company. You shall report to King World's Chairman of the
Board, Chief Executive Officer and/or Chief Operating Officer. Your base
of operations shall be located at the Company's New Jersey offices,
although you acknowledge that your services under this Agreement will
require such travel as the Company may reasonable require.
(b) You hereby grant to the Company options to extend the
Employment Period for four additional twelve-month periods (the "Option
Periods") to commence on September 1, 1998 and to end on August 31, 1999,
in the case of the first Option Period, to commence on September 1, 1999
and to end on August 31, 2000, in the case of the second Option Period, to
commence on September 1, 2000 and to end on August 31, 2001, in the case of
the third Option Period, and to commence on September 1, 2001 and to end on
August 31, 2002, in the case of the fourth Option Period. The Company may
exercise such option with respect to any Option Period by giving you
written notice to such effect not later than the June 1st preceding the
commencement of such Option Period. In the event that the Company elects<PAGE>
<PAGE>
to exercise any of such options, the terms and provisions of this Agreement
shall remain in effect and shall apply during the Employment Period as so
extended.
2. (a) The Company shall pay to you, and you shall accept, for
your services performed for the Company and its parent, subsidiaries and
affiliates during the Employment Period, salary compensation at the annual
rate of (i) $250,000 for the period commencing September 1, 1997 and ending
August 31, 1998; (ii) subject to the Company's exercising the option for
the first Option Period, $275,000 during such Option Period; (iii) subject
to the Company's exercising the option for the second Option Period,
$285,000 during such Option Period; (iv) subject to the Company's exercis-
ing the option for the third Option Period, $300,000 during such Option
Period; and (v) subject to the Company's exercising the option for the
fourth Option Period, $315,000 during such Option Period. Any compensation
payable pursuant to this paragraph 2(a) shall be paid in accordance with
the Company's normal payroll policy at the time in effect.
(b) During each year of the Employment Period you may also
be entitled to a bonus if the Board of Directors of the Company, in its
sole and absolute discretion, shall so determine.
(c) Subject to the provisions of this paragraph (c), you
are hereby granted a "non-qualified stock option" under the 1996 Amended
and Restated Stock Option and Restricted Stock Purchase Plan (the "Plan")
of King World to purchase 75,000 shares of King World's Common Stock, $.O1
par value (the "Common Stock"), at an exercise price per share equal to the
closing price of the Common Stock on the New York Stock Exchange on June 5,
1997. You understand and agree with respect to such stock option that:
(i) your right to exercise such option shall vest over a five
year period as follows: 20% on August 31, 1998; 20% on August 31, 1999; 20%
on August 31, 2000; and 40% on August 31, 2002; and
(ii) if you should cease to be a full-time employee of the
Company and any of its subsidiaries or affiliates, then you shall only have
the right to exercise the unexercised portion of such option within one
month after the date on which you ceased to be so employed and then only to
the extent that such portion was vested (pursuant to the foregoing vesting
schedule) on the date you ceased to be so employed, and you shall forfeit
all other rights to and under such option, PROVIDED, HOWEVER, that if your
full-time employment ceases by reason of your death or "disability" (within
the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as
amended), then such one month period shall instead be a one-year period
following the cessation of your employment.
The foregoing, as well as such other terms and conditions as King
World shall deem appropriate, shall be set forth in a definitive stock
option agreement. Your rights as an optionee shall be governed by the
terms and conditions of such agreement and the Plan.
<PAGE>
3. You shall be entitled to participate, on the same basis as
the other employees of the Company, in any pension, life insurance, health
insurance or hospitalization plan generally in effect with respect to all
such other employees. You shall be entitled to reimbursement of expenses
reasonably incurred by you in connection with the performance of your
duties hereunder, provided that you promptly furnish documentation therefor
reasonably satisfactory to the Company.
4. (a) In the event of your death, the Employment Period shall
automatically terminate, effective upon the date of your death.
(b) In the event that you are unable to perform the duties
required of you pursuant to this Agreement, for (i) ninety (90) days during
the Employment Period (whether or not such ninety (90) days are consecu-
tive) or (ii) any thirty (30) consecutive days during the Employment
Period, by reason of illness or other physical incapacity, the Company may,
after the expiration of such ninety (90) or thirty (30) days, terminate the
Employment Period.
5. (a) Except as required in connection with the performance
of your services for the Company, you shall not, during or after the
termination of the Employment Period, use or disclose to any person, firm,
partnership or corporation any confidential or proprietary information or
trade secrets of the Company, King World or any of their subsidiaries or
affiliates obtained or learned by you during the Employment Period, includ-
ing, without limitation, the type and nature of the contracts entered into
by the Company, King World or any of their subsidiaries or affiliates in
connection with the acquisition of television programming or the acquisi-
tion of distribution rights with respect to any such programming (includ-
ing, without limitation, the acquisition of advertising time within any
television programming or acting as sales agent for any such advertising
time, irrespective of whether the Company, King World or any of its
subsidiaries or affiliates distributes such programming to television
stations ("Advertising Time")), the sale or other distribution of televi-
sion programming (including, without limitation, Advertising Time), or the
basis upon which the Company, King World or any of their subsidiaries or
affiliates elects to acquire television programming or distribution rights
with respect to any such programming (including, without limitation,
Advertising Time) for sale or other distribution.
(b) You also agree that during and for a period of two (2)
years following the termination of the Employment Period, you will not work
for, or render services to or for the benefit of, or otherwise be interest-
ed in (whether as an employee, consultant, independent contractor, propri-
etor, investor, lender or in any other manner), any business or portion of
a business of any person, firm, partnership, corporation or other entity
which supplied television programming (including, without limitation,
Advertising Time) to, or which entered into a distribution (including,
without limitation, sales agency) agreement for television programming
with, the Company, King World or any of its subsidiaries or affiliates at
<PAGE>
any time within the two (2) year period preceding the termination of the
Employment Period.
6. You hereby agree that during and for a period of two (2)
years following the termination of the Employment Period, you shall not (a)
induce, directly or indirectly, any person, firm, partnership, corporation
or other entity from whom or from which the Company, King World or any of
their subsidiaries or affiliates acquired television programming or
distribution (including, without limitation, sales agency) rights with
respect thereto (including, without limitation, Advertising Time) during
the Employment Period to terminate its agreement with the Company, King
World or such subsidiary or affiliate with respect to such programming or
distribution rights (including any such Advertising Time), to elect not to
renew any such agreement or not to furnish to the Company, King World or
any such subsidiary or affiliate any other television programming or
distribution rights (including, without limitation, Advertising Time) or
(b) induce, directly or indirectly, any employee of the Company, King World
or any of their subsidiaries or affiliates to terminate his or her employ-
ment with the Company, King World or any such subsidiary or affiliate.
7. You hereby agree that all ideas, creations, improvements and
other works of authorship created, developed, written or conceived by you
within the scope of your employment hereunder at any time during the
Employment Period are works for hire within the scope of your employment
and shall be the property of the Company free of any claim whatever by you
or any person claiming any rights or interests through you. Notwithstand-
ing any other provision of this Agreement that may be to the contrary,
nothing contained in this Agreement shall require the Company to utilize
your services under this Agreement, the Company's only obligation to you
being payment of your compensation and reimbursable expenses under this
Agreement during the Employment Period.
8. (a) You hereby agree to indemnify and hold the Company
harmless from and against any and all loss, damage, liability, cost and
expense, including reasonable attorneys' fees, incurred by the Company as a
result of, arising out of or in connection with a violation of any term or
condition of this Agreement required to be performed or observed by you.
(b) The Company hereby agrees to indemnify and hold you
harmless from and against any and all loss, damage, liability, cost and
expense, including reasonable attorneys' fees, incurred by you as a result
of, arising out of or in connection with a violation of any term or
condition of this Agreement required to be performed or observed by the
Company.
9. (a) This Agreement shall be governed by and construed in
accordance with the laws of the State of New Jersey. This Agreement
constitutes the entire agreement between the parties hereto with respect to
the subject matter hereof. The failure of a party to insist upon strict
compliance with any provision of this Agreement shall not be deemed to be a
waiver of such provision or of any other provision of this Agreement. No
waiver or modification of the terms or conditions hereof shall be valid
unless in writing signed by the party to be charged and only to the extent
therein set forth. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their successors, assigns, heirs,
administrators and executors.
(b) Any legal suit, action or proceeding arising out of or
based upon this Agreement may be instituted in the federal courts of the
United States of America or the courts of the State of New York, in each
case located in the City and County of New York (collectively, the "Speci-
fied Courts"), and each party irrevocably submits to the exclusive juris-
diction (except for proceedings instituted in regard to the enforcement of
a judgment of any such court, as to which such jurisdiction is non-exclu-
sive) of such courts in any such suit, action or proceeding. Service of
any process, summons, notice or document by mail to such party's address
set forth above shall be effective service of process for any suit, action
or other proceeding brought in any such court. The parties irrevocably and
unconditionally waive any objection to the laying of venue of any suit,
action or other proceeding in the Specified Courts and irrevocably and
unconditionally waive and agree not to plead or claim in any such court
that any such suit, action or other proceeding brought in any such court
has been brought in an inconvenient forum.
Yours very truly,
KING WORLD CORPORATION
By:
__________________________
ACCEPTED:
________________
Steven LoCascio<PAGE>
<Page 6>
KING WORLD CORPORATION
830 Morris Turnpike
Short Hills, New Jersey 07078
June 5, 1997
Mr. Steven LoCascio
c/o King World Corporation
830 Morris Turnpike
Short Hills, New Jersey 07078
Dear Steve:
This letter, when accepted by you, shall constitute an amendment
(the "Third Amendment") to the letter agreement, dated September 1, 1989,
as amended May 20, 1991, between King World Productions, Inc. ("King
World") and you, which letter agreement was assigned, as of January 1,
1992, by King World to its wholly-owned subsidiary, King World Corporation
(the "Company"), and was further amended on January 4, 1994. Such letter
agreement, as so amended and assigned, is hereinafter referred to as the
"Letter Agreement." All of the definitions of the Letter Agreement shall
govern this Amendment.
The Company agrees that, effective as of the date hereof, the
Company employs you as Senior Vice President and Chief Financial Officer of
King World.
Except as modified herein, all terms and provisions of the Letter
Agreement shall continue in full force and effect.
Very truly yours,
KING WORLD CORPORATION
By:_______________________
ACCEPTED:
_____________________
Steven LoCascio
Exhibit 10.2
KING WORLD PRODUCTIONS, INC.
12400 Wilshire Boulevard
Los Angeles, California 90025
June 6, 1997
Mr. Jules Haimovitz
c/o Craig A. Jacobson, Esq.
Hansen, Jacobson, Teller & Hoberman
450 North Roxbury Drive - 8th floor
Beverly Hills, CA 90210-4222
Dear Jules:
This letter, when accepted by you, shall constitute an agreement
between you and King World Productions, Inc. (the "Company") with respect
to your employment by the Company for the Employment Period (as hereinafter
defined).
1. (a) The Company hereby agrees to employ you as President and
Chief Operating Officer for the period commencing on June 23, 1997 and
terminating on August 31, 2000 or such earlier date on which the term of
this Agreement terminates pursuant to the provisions hereof (the "Employ-
ment Period"). You hereby agree to accept such employment, to diligently,
faithfully and competently perform such services consistent with your
positions as shall from time to time be reasonably assigned to you by the
Company's Board of Directors or its Chief Executive Officer or Chairman of
the Board, and to diligently, faithfully and competently devote your entire
business time, skill and attention to the performance of your duties and
responsibilities to the Company; provided, however, that the Company
acknowledges that your continuing service as a director of and/or consul-
tant to each of Diva Systems Corporation ("Diva") and Sundance Holdings or
Sundance-associated entities in which Sundance Holdings has an ownership
interest or with which it is otherwise affiliated (collectively,
"Sundance") will not be inconsistent with the foregoing obligations so long
as no such directorship or consultancy materially interferes with your
performance, or otherwise constitutes a breach, of your obligations to the
Company under this Agreement; provided further, however, that (i) you shall
notify the Company promptly in each instance when you become aware that you
will be providing services in excess of an aggregate of two (2) business
hours on any day to Diva and/or Sundance and (ii) the amount of time
devoted by you to Diva and Sundance collectively shall not exceed an
aggregate of twenty-four (24) business hours during any consecutive three-
month period. You shall report to the Company's Chief Executive Officer and
its Chairman of the Board. Your base of operations shall be located at the
<PAGE>
Company's offices in the Los Angeles, California metropolitan area,
although you acknowledge that your services under this Agreement will
require such travel as the Company may reasonably require. As a condition
of your employment by the Company, you hereby affirm and represent that you
are under no obligation to any current or former employer or other party
that is in any way inconsistent with, or that imposes any restriction upon,
your acceptance of employment hereunder with the Company, the employment of
you by the Company, or your undertakings under this Agreement.
(b) You hereby grant to the Company an option (the "Op-
tion") to extend the Employment Period for one additional twenty-four-month
period to commence on September 1, 2000 and to end on August 31, 2002. The
Company may exercise the Option only by giving you written notice to such
effect not later than February 28, 1999. In the event that the Company
elects to exercise the Option, (i) the terms and provisions of this Agree-
ment shall remain in effect and shall apply during the Employment Period as
so extended and (ii) you shall be appointed to the Board of Directors of
the Company on or before February 28, 1999 and shall be nominated by the
Company for re-election thereto at each Annual Meeting of Stockholders of
the Company at which the class of directors to which you are assigned is
subject to re-election.
(c) Provided the Option has not theretofore been exercised,
the Company shall, notwithstanding any other provision of this Agreement to
the contrary, have the right, exercisable by written notice to you on or
before February 28, 1999, to terminate the Employment Period without cause
as of any date (the "Early Termination Date") on or before February 28,
1999. In the event the Company elects to so terminate the Employment
Period, the Company shall pay to you, within ten business days following
the Early Termination Date, $1,500,000 (the "Termination Amount") in
complete termination and settlement of all of its obligations to you under
this Agreement, except for any bonus payment thereafter becoming payable to
you pursuant to Section 3 and except for your entitlement to any other
compensation earned by you prior to the Early Termination Date and your
vested entitlement under any employee benefit plan. The Company acknowl-
edges that, if the Company elects to terminate the Employment Period
pursuant to this Section 1(c), you shall not be required to mitigate the
Company's obligation to pay to you the Termination Amount and that it shall
not be entitled to offset against the Termination Amount any compensation
earned by you after the Early Termination Date.
(d) If the Company does not exercise the Option, you shall
have the right, exercisable by written notice to the Company only during
the thirty-day period commencing March 1, 1999, to terminate the Employment
Period without cause effective as of the thirtieth day after the date of
such notice. If you elect to so terminate the Employment Period, you shall
have no right to receive any compensation under this Agreement after such
effective date, except for any bonus payment thereafter becoming payable to
you pursuant to Section 3 and except for your entitlement to any other
<PAGE>
compensation earned by you prior to such termination and your vested
entitlement under any employee benefit plan.
2. (a) The Company shall pay to you, and you shall accept, for
your services performed for the Company and its subsidiaries and affili-
ates during the Employment Period, salary compensation at the annual rate
of (i) $1,000,000 for the period commencing June 23, 1997 and ending August
31, 1998; (ii) $1,050,000 for the period commencing September 1, 1998 and
ending August 31, 1999; (iii) $1,100,000 for the period commencing Septem-
ber 1, 1999 and ending August 31, 2000; and (iv) subject to the exercise of
the Option by the Company, (A) $1,150,000 for the period commencing
September 1, 2000 and ending August 31, 2001 and (B) $1,200,000 for the
period commencing September 1, 2001 and ending August 31, 2002. Any
compensation payable pursuant to this Section 2(a) shall be paid in
accordance with the Company's normal payroll policy at the time in effect.
(b) Subject to the provisions of this Section 2(b), the
Company hereby grants to you a "non-qualified stock option" under the
Company's 1996 Amended and Restated Stock Option and Restricted Stock
Purchase Plan (the "Plan") to purchase 250,000 shares of the Company's
Common Stock, $.01 par value (the "Common Stock"), at an exercise price per
share equal to the closing price of the Common Stock on the New York Stock
Exchange on the date hereof. You understand and agree with respect to such
stock option that:
(i) your right to exercise such option shall vest over a five
year period as follows: 40% on June 14, 1999; 20% on June 14, 2000; 20% on
June 14, 2001; and 20% on June 14, 2002; and
(ii) if you should cease to be a full-time employee of the
Company and any of its subsidiaries or affiliates, then you shall only have
the right to exercise the unexercised portion of such option within one
month after the date on which you ceased to be so employed and then only to
the extent that such portion was vested (pursuant to the foregoing vesting
schedule) on the date you ceased to be so employed, and you shall forfeit
all other rights to and under such option, PROVIDED, HOWEVER, that if your
full-time employment ceases by reason of your death or "disability" (within
the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as
amended), then such one month period shall instead be a one-year period
following the cessation of your employment.
The foregoing, as well as such other terms and conditions as the
Company shall deem appropriate, shall be set forth in a definitive stock
option agreement substantially in the form previously furnished to you.
Your rights as an optionee shall be governed by the terms and conditions of
such agreement and the Plan.
If the Company terminates the Employment Period without cause at
any time after February 28, 1999, your expectation damages in connection
<PAGE>
with any remedy to which you may be entitled as a result of such termina-
tion shall include, insofar as the option granted under this Section 2 is
concerned, the value of the portion of such option that would have vested
during the portion of the Employment Period following such termination if
the Employment Period had not been so terminated.
(c) If, following a Change of Control (as hereinafter defined),
the vesting of Plan options granted to any other officer of the Company is
accelerated, the Plan option granted to you pursuant to this Agreement
shall also be accelerated on the same basis as the most favorable provi-
sions granted to any such other officer of the Company. In addition, if,
following a Change of Control that occurs after February 28, 1999, the
Company terminates the Employment Period without cause, you shall not be
required to mitigate the Company's obligation to pay to you any amounts
owed to you pursuant to this Agreement and the Company shall not be enti-
tled to offset against such amounts any compensation earned by you after
such termination. For the purposes of this Agreement, "Change of Control"
shall mean an event constituting a Change of Control under the current
employment agreement between the Company and its Chairman of the Board.
3. (a) With respect to each full fiscal year of the Company
entirely within the Employment Period beginning with the fiscal year
commencing on September 1, 1997 and ending within (or upon the termination
of) the Employment Period, you shall be entitled to a bonus equal to 1.0%
of the Consolidated Net Income of the Company in excess of $150,000,000 for
such fiscal year. "Consolidated Net Income" shall mean, for the purposes
of this Section 3(a), the net income, after taxes but before all extraor-
dinary items, of the Company and its consolidated subsidiaries, as reported
in its audited financial statements for such fiscal year filed with the
Securities and Exchange Commission (the "SEC"). Payment of any bonus
payable to you in accordance with the provisions of this Section 3(a) shall
be made within thirty (30) days of delivery to the Company of the determi-
nation thereof by the Company's independent public accountants.
(b) With respect to any fiscal year of the Company that
contains the date upon which the Employment Period terminates (the "Employ-
ment Termination Date"), you shall be entitled to bonus compensation if the
Consolidated Net Income for the period (the "Last Period") commencing on
the September 1st of such fiscal year and ending on the last day of the
Company's most recent full fiscal quarter, if any, within such fiscal year
that falls upon or precedes the Employment Termination Date exceeds the
product of (A) $150,000,000 and (B) a fraction, the numerator of which is
the number of full fiscal quarters in the Last Period and the denominator
of which is four (4). In such event, the Company shall pay to you 1% of
such excess within thirty (30) days of the filing by the Company of its
Form 10-Q for such most recent fiscal quarter with the SEC. "Consolidated
Net Income" shall mean, for the purposes of this Section 3(b), the net
income, after taxes but before all extraordinary items, of the Company and
its consolidated subsidiaries, as reported in the Company's unaudited
<PAGE>
financial statements for such most recent fiscal quarter filed with the
SEC.
4. Notwithstanding anything to the contrary contained herein,
the bonus described in Section 3 hereof is subject to approval of the
stockholders of the Company and any additional approvals or consents that
may, in the reasonable opinion of counsel to the Company, be necessary or
desirable for the Company to obtain. In the event that such approvals are
not obtained on or prior to March 1, 1998, then you and the Company shall
negotiate in good faith for the purpose of agreeing upon a mutually
acceptable cash substitute of equivalent value for the bonus (which may
also be subject to stockholder and other approvals). If, after good-faith
negotiation, you and the Company cannot so agree, then you may, in your
sole discretion, terminate the Employment Period.
5. (a) You shall be entitled to participate, on the same basis
as the other executive officers of the Company, in any and all benefit
plans, including without limitation pension, 401(k) or other retirement,
life insurance, health insurance, hospitalization or disability insurance
plans, generally in effect with respect to all such executive officers.
You shall be entitled to reimbursement of expenses reasonably incurred by
you in connection with the performance of your duties hereunder, provided
that you promptly furnish documentation therefor reasonably satisfactory to
the Company.
(b) The Company shall furnish you with executive office
space commensurate with your title and responsibilities, which you agree is
satisfied by the corner office adjacent to the office currently occupied by
the Company's Chief Executive Officer, and with a secretary mutually
designated by you and the Company, consistent with the Company's customary
hiring and compensation practices.
(c) The Company shall provide computer, fax and other
equipment in your home reasonably necessary to facilitate your performance
of your duties under this Agreement. At the end of the Employment Period,
you shall return to the Company all such equipment.
(d) You shall be entitled to stay in first-class hotel
accommodations and to utilize first-class air travel (if available and if
used) in connection with your performance of services under this Agreement.
(e) You shall be entitled to four (4) weeks of vacation
during each year of the Employment Period.
6. (a) In the event of your death, the Employment Period shall
automatically terminate, effective upon the date of your death.
(b) In the event that you are unable to perform the
material duties required of you pursuant to this Agreement, for (i) ninety
(90) days during any consecutive twelve months during the Employment Period
<PAGE>
(whether or not such ninety (90) days are consecutive) or (ii) any sixty
(60) consecutive days during the Employment Period, by reason of illness or
other physical incapacity, the Company may, after the expiration of such
ninety (90) or sixty (60) days, terminate the Employment Period, it being
understood that you shall not thereby be deprived of your rights under any
disability severance plan of the Company then in effect.
7. Except as required in connection with the performance of
your services for the Company, you shall not, during or after the termina-
tion of the Employment Period, use or disclose to any person, firm,
partnership or corporation any confidential or proprietary information or
trade secrets of the Company or any of its subsidiaries or affiliates
obtained or learned by you during the Employment Period, including, without
limitation, to the extent not public information, the type and nature of
the contracts entered into by the Company or any of its subsidiaries or
affiliates in connection with the acquisition of television programming or
the acquisition of distribution rights with respect to any such programming
(including, without limitation, the acquisition of advertising time within
any television programming or acting as sales agent for any such advertis-
ing time, irrespective of whether the Company or any of its subsidiaries or
affiliates distributes such programming to television stations ("Advertis-
ing Time")), the sale or other distribution of television programming
(including, without limitation, Advertising Time), or the basis upon which
the Company or any of its subsidiaries or affiliates elects to acquire
television programming or distribution rights with respect to any such
programming (including, without limitation, Advertising Time) for sale or
other distribution.
8. You hereby agree that during and for a period of (a) two (2)
years following the termination of the Employment Period, you shall not
induce, directly or indirectly, any person, firm, partnership, corporation
or other entity from whom or from which the Company or any of its subsid-
iaries or affiliates acquired television programming or distribution
(including, without limitation, sales agency) rights with respect thereto
(including, without limitation, Advertising Time) during the Employment
Period to terminate its agreement with the Company or such subsidiary or
affiliate with respect to such programming or distribution rights (includ-
ing any such Advertising Time), or (b) one (1) year following the termina-
tion of the Employment Period, you shall not induce, directly or indirect-
ly, any employee of the Company (excluding the secretary assigned to you)
or any of its subsidiaries or affiliates to terminate his or her employment
with the Company or any such subsidiary or affiliate.
9. You hereby agree that all ideas, creations, improvements and
other works of authorship created, developed, written or conceived by you
within the scope of your employment at any time during the Employment
Period are works for hire within the scope of your employment and shall be
the property of the Company free of any claim whatever by you or any person
claiming any rights or interests through you. Notwithstanding any other
provision of this Agreement that may be to the contrary, nothing contained
<PAGE>
in this Agreement shall require the Company to utilize your services under
this Agreement, the Company's only obligation to you being payment of your
compensation and reimbursable expenses under this Agreement earned by you
during the Employment Period.
10. (a) You hereby agree to indemnify and hold the Company
harmless from and against any and all loss, damage, liability, cost and
expense, including reasonable outside attorneys' fees, incurred by the
Company as a result of, arising out of or in connection with a violation of
any term or condition of this Agreement required to be performed or
observed by you.
(b) The Company hereby agrees to indemnify and hold you
harmless from and against any and all loss, damage, liability, cost and
expense, including reasonable attorneys' fees, incurred by you as a result
of, arising out of or in connection with (i) any action taken by you in
accordance with Delaware law and your performance of your obligations under
this Agreement and (ii) a violation of any term or condition of this
Agreement required to be performed or observed by the Company.
(c) The Company agrees that you shall be covered under any
directors' and officers' liability insurance maintained by the Company on
the same basis as the other officers of the Company.
11. (a) If you shall breach any of the material terms of this
Agreement, including but not limited to a failure or refusal by you to
perform services assigned by the Company to you pursuant to this Agreement,
the Company shall have the right, upon written notice to you, to suspend
the Employment Period and all the Company's obligations to you under this
Agreement, until you resume performance of your services in a satisfactory
manner. In addition to the Company's foregoing rights, the Company shall
have the right to terminate the Employment Period and the Company's
obligations to you hereunder following the occurrence of such breach if you
have not cured such breach within ten (10) days following the Company's
written notice of same to you, provided, however, that if by the nature of
such breach, such breach is incurable, the Company shall not be required to
accord you any cure period prior to the Company's exercise of its right to
terminate. Such actions by the Company shall be without prejudice to any
and all remedies the Company may have, in law or equity, for breach of this
Agreement.
(b) If the Company shall breach any of the material terms
of this Agreement, you shall have the right to terminate the Employment
Period and your obligations to the Company hereunder following the occur-
rence of such breach if the Company has not cured such breach within ten
(10) days following your written notice of same to the Company; provided,
however, that if by the nature of such breach, such breach is incurable,
you shall not be required to accord the Company any cure period prior to
your exercise of your right to terminate. Such actions by you shall be
<PAGE>
without prejudice to any and all remedies you may have, in law or equity,
for breach of this Agreement.
12. The Company and you shall mutually approve the press release
announcing your hiring by the Company.
13. (a) This Agreement shall be governed by and construed in
accordance with the laws of the State of California. This Agreement
constitutes the entire agreement between the parties hereto with respect to
the subject matter hereof. The failure of a party to insist upon strict
compliance with any provision of this Agreement shall not be deemed to be a
waiver of such provision or of any other provision of this Agreement. No
waiver or modification of the terms or conditions hereof shall be valid
unless in writing signed by the party to be charged and only to the extent
therein set forth. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their successors, assigns, heirs,
administrators and executors.
(b) Any legal suit, action or proceeding arising out of or
based upon this Agreement may be instituted in the federal courts of the
United States of America, or the courts of the State of California, in each
case located in the City and County of Los Angeles (collectively, the
"Specified Courts"), and each party irrevocably submits to the exclusive
jurisdiction (except for proceedings instituted in regard to the enforce-
ment of a judgment of any such court, as to which such jurisdiction is non-
exclusive) of such courts in any such suit, action or proceeding. The
parties irrevocably and unconditionally waive any objection to the laying
of venue of any suit, action or other proceeding in the Specified Courts
and irrevocably and unconditionally waive and agree not to plead or claim
in any such court that any such suit, action or other proceeding brought in
any such court has been brought in an inconvenient forum.
Yours very truly,
KING WORLD PRODUCTIONS, INC.
By:_______________________________
ACCEPTED:
_________________________
Jules Haimovitz
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<LEGEND>
EXHIBIT 27.1
FINANCIAL DATA SCHEDULE
COMMERCIAL AND INDUSTRIAL COMPANIES
ARTICLE 5 OF REGULATION S-X
This schedule contains summary financial information extracted
from the Consolidated Statements of Operations and Consolidated Balance
Sheets of King World Productions, Inc. and its Subsidiaries and is quali-
fied in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> 08/31/97
<PERIOD-START> 03/01/97
<PERIOD-END> 05/31/97
<EXCHANGE-RATE> 1
<CASH> $509,775
<SECURITIES> $0
<RECEIVABLES> $70,489
<ALLOWANCES> $4,101
<INVENTORY> $0
<CURRENT ASSETS> $658,015
<PP&E> $20,967
<DEPRECIATION> $(11,750)
<TOTAL-ASSETS> $861,683
<CURRENT-LIABILITIES> $109,895
<BONDS> $0
<COMMON> $509
$0
$0
<OTHER-SE> $751,788
<PAGE 2>
<TOTAL-LIABILITY-AND-EQUITY> $861,683
<SALES> $0
<TOTAL-REVENUES> $166,751
<CGS> $0
<TOTAL-COSTS> $97,745
<OTHER-EXPENSES> $22,385
<LOSS-PROVISION> $0
<INTEREST-EXPENSE> $0
<INCOME-PRETAX> $54,890
<INCOME-TAX> $19,185
<INCOME-CONTINUING> $35,705
<DISCONTINUED> $0
<EXTRAORDINARY> $0
<CHANGES> $0
<NET-INCOME> $35,705
<EPS-PRIMARY> $0.95
<EPS-DILUTED> $0.95
</TABLE>
