Freston Severance Package Finalized, Detailed; Worth About $85 Million

If Viacom shareholders weren’t thrilled by Tom Freston’s compensation as CEO and president wait until they see the going away package. Freston’s brief tenure as Viacom CEO ended just after labor day but the severance agreement wasn’t finalized until earlier this week, according to an SEC filing made today. Freston’s termination payment alone is $58.9 million, including annual salary, target bonuses and deferred compensation from the “resignation date” — officially Sept. 22 — through June 30, 2009. He is supposed to get half of that in a lump sum 30 days after the official date and the rest as regular payroll but has agreed to defer that for six months. Freston gets medical, dental and $8 million in life insurance for the duration, unless provided by a subsequent employer.
— Freston has agreed to become a consultant to Viacom for the next three years at $1 million a year. he can give 14 days notice.
— 90,141 previously awarded restricted stock units vested on termination and will be settled by shares of Viacom Class B common stock six months after the resignation date; that will cost Viacom approximately $10 million compensation expense.
— He also gets another $14 million or so in deferred compensation and 401k.
Upshot: Freston’s roughly $85 million farewell handshake may not be enough to set up his own PE firm but it probably would cover some of the small acquisitions Viacom is making.
Related: Exec Compensation: New Viacom Execs; Rupert Murdoch
Breaking News: Freston Out As Viacom CEO; Replaced By Board Member Dauman

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