Jeff Shell may be exiting Paramount Skydance, but he’s not leaving empty-handed.
Thursday’s securities filing laid out the terms of his exit as president of the company, which also revealed a major restructuring of its debt tied to the Warner Bros. deal. Discovery huge.
Shell’s separation agreement, which was filed on Thursday morning, calls for cash payments equal to the target salary and bonus he would be eligible to receive, spread over the next 12 months. Shell’s contract calls for a salary of $3.5 million and a target bonus of $1.5 million, so the cash payout should be in the region of $5 million.
In addition, he will be eligible for accelerated vesting of restricted stock units (RSUs) that would have vested over the 12 months following his separation. When he joined Paramount last August, Shell received 5 million RSUs that would vest quarterly over five years. The accelerated vesting will unlock about 1 million shares of Paramount Skydance, with a book value of about $10.7 million as of writing.
When combined with company health and dental coverage, the Shell package should exceed $15 million, give or take.
Paramount revealed Shell’s exit on Wednesday.
Paramount’s board of directors said in a statement that Shell would step down as president of the company and from the board “to focus on this lawsuit” brought by gambler RJ Cipriani, the man who sued him.
Paramount said a “full and comprehensive” review, conducted by its board of directors with the assistance of an outside consultant, cleared Shell of any wrongdoing.
Paramount also revealed a significant update to the debt package it has assembled to help finance its massive Warner Bros. deal. Discovery. Big updates: The company has consolidated debt across 18 banks, reducing the exposure of the original backers to the three debts: Citibank, Bank of America and Apollo.
The company has also entered into permanent financing that will factor into the company’s capital structure, including a $5 billion revolver and a $5 billion term loan. This permanent financing will reduce interim loans from $54 billion to $49 billion.
“The successful debt combination and new debt facility represents another important milestone toward completing our acquisition of Warner Bros. Discovery,” Andy Gordon, Paramount’s chief strategy officer and chief operating officer, said in a statement. “This progress follows closely on the heels of our equity partnership, which diversifies our shareholder base and produces strategic and commercial opportunities. The strong demand for both our equity and debt offerings underscores confidence in our vision and ability to deliver greater value by combining these two iconic companies – creating a leading media and entertainment company that strengthens competition, better serves the creative community and delivers more compelling stories to audiences.”
