|
MUMBAI: US media conglomerate Viacom's board of directors
has announced that it has entered into a revised employment
agreement with its Executive Chairman Sumner M Redstone.
The agreement reduces cash salary and bonuses effective 1
January, 2007 and immediately directly links the majority
of Redstone’s compensation to superior shareholder returns.
Redstone and the Compensation Committee of the Viacom Board
are extending the equity driven approach to compensation and
incentives adopted by Viacom in its recently announced agreements
with Viacom president and CEO Philippe P Dauman and Viacom’s
senior executive VP and chief administrative officer Thomas
E Dooley.
Redstone said, “As both a major shareholder and as the
executive chairman of the company, I have long been in favour
of the pay-for-performance model, which I believe is good
for shareholders and good for the company. I want to commend
the Compensation Committee for not only listening to our stockholders,
but for their leadership, creativity and discipline in creating
this new shareholder-friendly compensation structure.”
Under the terms of the new agreement, beginning in 2007,
Redstone’s salary will be reduced to $1 million per year
(from current $1.75 million), and deferred compensation, presently
$1.3 million per year, will be eliminated. His target cash
bonus under Viacom’s short-term incentive plan will be
reduced from $6.1 million to $3.5 million per year.
Redstone will receive an annual award of stock options having
a grant-date value of $3 million. He will also receive an
annual award of performance share units (PSU’s) with
a grant-date target value of $3 million.
| 
