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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 15, 1999
CD RADIO INC.
(Exact Name of Registrant as Specified in Charter)
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DELAWARE 0-24710 52-1700207
(State or other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
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1221 AVENUE OF THE AMERICAS, 36TH FL., NEW YORK, NY 10020
(Address of Principal Executive Offices) (Zip Code)
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Registrant's telephone number, including area code: (212) 584-5100
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
In connection with the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995 (the "Reform Act"), CD Radio ("us", "we" and
occasionally, the "Company") is hereby providing cautionary statements
identifying important factors that could cause our actual results to differ
materially from those projected in forward-looking statements (as such term is
defined in the Reform Act) made in this Current Report on Form 8-K. Any
statements that express, or involve discussions as to, expectations, beliefs,
plans, objectives, assumptions or future events or performance (often, but not
always, through the use of words or phrases such as "will likely result," "are
expected to," "will continue," "is anticipated," "estimated," "intends,"
"plans," "projection" and "outlook") are not historical facts and may be
forward-looking. Such statements involve estimates, assumptions and
uncertainties that could cause actual results to differ materially from those
expressed in the forward-looking statements. Accordingly, any such statements
are qualified in their entirety by reference to the factors discussed in our
Annual Report on Form 10-K for the year ended December 31, 1998, and investors
should not place undue reliance on any such forward-looking statements. Among
the significant factors that have a direct bearing on our results of operations
are the potential risk of delay in implementing our business plan; increased
costs of construction and launch of necessary satellites; our dependence on
Space Systems/Loral, Inc.; risk of launch failure; unproven market and unproven
applications of existing technology; our dependence on Lucent Technologies,
Inc.; unavailability of receivers and antennas; and our need for additional
financing.
Management cannot assess the impact of each such factor on our business
or the extent to which any factor, or combination of factors, may cause actual
results to differ materially from those contained in any forward-looking
statements. Further, any forward-looking statement speaks only as of the date on
which such statement is made, and we undertake no obligation to update any
forward-looking statement or statements to reflect events or circumstances after
the date on which such statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time, and it is not
possible for management to predict all of such factors.
ITEM 5. OTHER EVENTS.
On June 15, 1999, we announced an agreement with Ford Motor Company
("Ford") which anticipates Ford manufacturing, marketing and selling vehicles
that include receivers capable of receiving the CD Radio broadcasts. As part of
this agreement, Ford will be entitled to participate in a portion of the
revenues derived by us from new Ford vehicles equipped to receive CD Radio
broadcasts ("Ford Enabled Vehicles"), will be reimbursed for certain hardware
costs of Ford Enabled Vehicles, and has received warrants to purchase 4,000,000
shares our common stock at an exercise price of $30 per share. These warrants
are exercisable based upon the number of Ford Enabled Vehicles that Ford elects
to manufacture, and are fully exercisable upon 4,000,000 Ford Enabled Vehicles
being manufactured.
A copy of the press release announcing this agreement is attached as
Exhibit 99.1 to this Report and is incorporated by reference herein.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Not applicable.
(b) Not applicable.
(c) Exhibits.
99.1 Press release dated June 15, 1999.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CD RADIO INC.
By: /s/ Patrick L. Donnelly
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Patrick L. Donnelly
Executive Vice President, General
Counsel and Secretary
Dated: June 15, 1999
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EXHIBIT INDEX
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Exhibit Description of Exhibit
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99.1 Press release, dated June 15, 1999.
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EXHIBIT 99.1
FORD MOTOR COMPANY AND CD RADIO ANNOUNCE ALLIANCE
Auto Maker and Satellite Radio Broadcaster To Revolutionize In-Vehicle
Entertainment
DETROIT, -- June, 15 1999 -- Ford Motor Company (NYSE: F) and CD Radio (NASDAQ:
CDRD) today announced an alliance to bring digital satellite radio to Ford
customers. Ford is partnering with CD Radio to bring customers a revolutionary
in-vehicle entertainment service that will include commercial-free music and
seamless, coast-to-coast US coverage.
Ford vehicles are expected to be the first cars and trucks in the nation to have
factory-installed satellite radio receivers. The exclusive agreement includes
all seven Ford brands -- Ford, Lincoln, Mercury, Mazda, Jaguar, Aston Martin and
Volvo.
"CD Radio has a unique system which will offer our customers customized,
commercial-free listening choices across the country at any time. This
partnership is all about Ford Motor Company being the leader in bringing new
value and services to our customers," said Jac Nasser, Ford president and chief
executive officer. "Our objective is to become the world's leading consumer
company that provides automotive products and services."
Ford intends to begin installing CD Radio receivers starting as early as first
quarter 2001. Under terms of the agreement, Ford will also have access to
individually-addressed bandwidth and will work with CD Radio to develop
specialized programming and innovative telematic/infotronic functions
exclusively for Ford customers.
"CD Radio service will bring to radio what cable networks have brought to
television, and we will deliver it to our customers first," said Mike Ledford,
executive director, Telematics at Ford Motor Company.
"We're extremely pleased that the world's most respected auto maker has chosen
CD Radio as its satellite radio partner. Our objective is to have every car
already on the road and every car coming off an assembly line capable of
receiving the CD Radio signal. Ford's decision today is a significant step
toward achieving that goal," said David Margolese, CD Radio's chairman and chief
executive. "With this agreement Ford and CD Radio usher in a new era of
commercial-free music and innovative news, talk and entertainment radio
programming for motorists across the US."
For additional information regarding this agreement see CD Radio's Current
Report on Form 8-K dated June 15, 1999.
CD Radio is building a digital satellite radio system that will broadcast up to
100 channels of music and other programming to motorists throughout the United
States. The company plans to offer 50 channels of commercial-free music and up
to 50 channels of news, sports and entertainment programming for a monthly
subscription fee of $9.95. Commercial operations are scheduled to commence at
the end of the fourth quarter of 2000. The first of CD Radio's three satellites,
which are currently under construction by Space Systems/Loral, is scheduled for
launch in January.
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Any statements that express, or involve discussions as to, expectations,
beliefs, plans, objectives, assumptions, future events or performance are not
historical facts and may be forward-looking and, accordingly, such statements
involve estimates, assumptions and uncertainties which could cause actual
results to differ materially from those expressed in the forward-looking
statements. Accordingly, any forward-looking statements are qualified in their
entirety by reference to the factors discussed in CD Radio's Annual Report on
Form 10-K for the year ended December 31, 1998. Among the key factors that have
a direct bearing on CD Radio's results of operations are the potential risk of
delay in implementing CD Radio's business plan; increased costs of construction
and launch of necessary satellites; dependence on satellite construction and
launch contractors; dependence on Lucent Technologies; risk of launch failure;
unproven market and unproven applications of existing technology; unavailability
of CD Radio receivers; and CD Radio's need for additional financing.
For Further Information, Please Contact:
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Wes Sherwood for Ford Motor Company Jesse Stone or Gayle Berkowitz, for CD Radio
313-248-4901 212-453-2021
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NOTE 1: For digitized images of the CD Radio transmission system and receiver
equipment please go to www.media.ford.com.
NOTE 2: A live teleconference to announce this alliance will be webcast at 9:30
EDT at www.cdradio.com.
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