Top Viacom exex get to share the wealth
CEOs, exec VPs get about $98 mil in options
Sumner Redstone, chairman and CEO of the New York-based media conglom, waived a salary as usual, but picked up stock options valued at just under $50 million at the stock's current price.
Deputy chairmen and executive VPs Philippe P. Dauman and Thomas E. Dooley, who serve as Redstone's top lieutenants, each received an option package valued at $23.8 million. In addition, Dauman and Dooley each received $1 million in salary and $6 million in bonuses, increased substantially from the $2.75 million bonus each received in 1997.
The option-grants of 2 million shares apiece for Dauman and Dooley are adjusted for a 2-for-1 stock split to occur on Wednesday.
Viacom said the pair were granted the options, which will vest in equal installments four and five years from their August 1998 award date, for entering into new five-year contracts.
The options' exercise price was established by the fair market value on the underlying shares at the time they were awarded. Their value, adjusted for the forthcoming split, has since rocketed 39% to $42.47 a share.
Bigger bonuses
The annual salaries of Dauman and Dooley have stayed at $1 million apiece for the past three years. The $6 million bonus awarded each is up 118% from last year's $2.75 million bonus, however.
The pair also received deferred compensation of $710,000 apiece for 1998, payable the year after leaving the company.
Viacom said that in putting together the executive packages, its executive compensation committee considered the company's "record operating results, a significantly improved capital structure, the sale on very attractive terms of several noncore assets, including the company's nonconsumer publishing assets for approximately $4.7 billion, Blockbuster's music operations and Spelling's Virgin Interactive video game businesses, in addition to helping to achieve the repositioning of Blockbuster Entertainment."
Class A proposal
Viacom ended its filing by approving a proposed amendment to allow shareholders of voting, or Class A, stock to convert that stock to Class B, or nonvoting, stock. The amendment's purpose is to eliminate the premium commanded by Class B stock for having greater liquidity.
Redstone himself owns 93 million of Viacom's Class A shares, accounting for 66.8% of the class total, and 104 million Class B shares.
Class A shares have already started closing the gap, rising $3.38 Friday to close at $84.94 a share, compared with Class B's $1.56 rise to close at $85.12.
The one-day narrowing alone boosts Redstone's fortune by nearly $170 million.
Voting on the amendment will be concluded at the annual shareholders meeting, which this year will take place at the UCI Empire Theater in London, England, on May 19 at 2:30 p.m.
