Filing Overview
Madison Square Garden Entertainment Corp. filed a Form 8-K dated March 23, 2022, reporting the appointment of a new senior accounting executive. The report was signed on March 29, 2022. The filing predates the company’s later name change to Sphere Entertainment Co.
Material Appointment
- Courtney Zeppetella, age 45, was appointed Senior Vice President, Controller and Chief Accounting Officer, effective May 2, 2022.
- She succeeded Joseph F. Yospe, age 63, who was retiring as Senior Vice President, Controller and Principal Accounting Officer.
- Ms. Zeppetella joined from KPMG LLP, where she was an audit partner. The filing states that she had not provided services to the company while at KPMG and would fully withdraw from the KPMG partnership before joining the company.
- Her background includes SEC registrant audits, U.S. GAAP, and Sarbanes-Oxley Section 404 internal controls.
Employment Agreement and Compensation
- The employment agreement was dated March 23, 2022, with employment scheduled from May 2, 2022 through May 2, 2025.
- Annual base salary: not less than $550,000.
- Annual target bonus: 50% of annual base salary, beginning with the fiscal year starting July 1, 2022.
- Expected annual long-term incentive awards: aggregate target value of at least $500,000, subject to continued employment and participation in applicable company programs.
- One-time special cash payment: $200,000, payable within 30 days after the effective date. The amount is refundable if employment ends before the first anniversary because of specified resignation or cause-based termination circumstances.
- Eligible benefits include participation in the company’s standard employee benefits programs, subject to applicable plan terms.
Severance and Restrictive Covenants
- If the company terminates Ms. Zeppetella other than for cause, or she resigns for good reason when cause does not exist, and she executes a separation agreement, severance will be determined by the company but cannot be less than her annual base salary plus annual target bonus.
- She may also receive unpaid prior-year bonus amounts and a prorated bonus for the year of termination.
- The agreement includes a non-competition covenant generally extending through the first anniversary of termination, subject to exceptions tied to qualifying terminations and waiver of severance benefits.
Financial Metrics and Outlook
This filing is principally an executive appointment and compensation disclosure. It does not provide revenue, profit, cash flow, margins, debt, liquidity, operating guidance, or a broader financial outlook. The filing text does not provide a clear value for any such metrics.
Investor Verification Items
- Verify the effective date of Ms. Zeppetella’s appointment and the retirement transition of Mr. Yospe.
- Review Exhibit 10.1 for the complete definitions of cause, good reason, severance conditions, bonus terms, and restrictive covenants.
- Assess the potential compensation expense associated with the $550,000 minimum salary, 50% target bonus, expected long-term awards of at least $500,000, and $200,000 special cash payment.
- Confirm any subsequent changes to the company’s name, executive leadership, or employment agreement terms.