Sirius XM Extends Karmazin's Contract; Gives Him Him Raise & More

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Posted by on July 02, 2009 at 15:52:48:

In Reply to: Mel Karmazin Extends Contract Through 2012 posted by on July 02, 2009 at 15:52:19:

Karmazin Contract Extended, With Raise and Massive Options

Jon C. Ogg

Posted: July 1, 2009 at 12:29 pm

SIRIUS XM Radio Inc. has extended its contract with CEO Mel Karmazin to keep running the company. Today, June 30, 2009, the company entered into an amendment to the amended employment agreement, dated November 18, 2004, with Mel Karmazin.

The Amendment extends the term of the Employment Agreement through and until December 31, 2012. The new agreement increases Karmazin's base salary from $1,250,000 per year to $1,500,000 per year beginning on January 1, 2010. It also provides for the grant of an option to purchase 120,000,000 shares of SIRIUS common stock at an exercise price of $0.430 per share. Other than as provided in the amendment, the employment agreement will continue in accordance with its terms.

The option will vest in equal installments on each of December 31, 2010, December 31, 2011, June 30, 2012 and December 31, 2012; and the vesting of these options will accelerate upon the termination of Mr. Karmazin's employment by us without cause, by him for good reason, upon his death or disability and in the event of a change of control.

ADDITIONS TERMS: The option will generally expire on December 31, 2014; provided that if the parties subsequently agree to extend the term of the Employment Agreement through December 31, 2013 or later, then the term of the Option will automatically extend until the later of December 31, 2015 and the date that is one year following the date that such new employment agreement expires.

Late last year, we noted that it seemed very possible that Mel Karmazin might not survive through all of 2009 if things continued. The odds of Karmazin now being forced out probably went down to "very slim." But the company has its new financing, and is now under a much newer structure after recent Liberty deals.

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