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Stern Moves To Sell $200 Million In Sirius Stock...

Zim Hosein

Zim Hosein

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NEW YORK -- Just three days after starting his new job at Sirius Satellite Radio Inc., shock jock Howard Stern is now able to sell the roughly $200 million in Sirius stock that he received as part of his five-year deal with the company.

Sirius' contract with Stern runs through 2010, but the company disclosed last week that it was giving Stern and his agent 34.4 million shares of stock right away because it had already reached certain undisclosed targets for subscriber growth under the deal it signed with Stern in late 2004.

On Wednesday, the company made another regulatory filing saying that entities controlled by Stern and his agent, Don Buchwald, would receive the proceeds of the sale of the shares, which could occur at any time. It's not yet clear when or how much they will sell, and Buchwald did not return a call seeking comment.

Nearly all of the stock is going to Stern, but Buchwald also received a substantial chunk: 3.125 million shares, worth nearly $20 million at current share prices, or 10 percent of the 31.25 million shares that Stern received, which are now worth just under $200 million.

Sirius originally said its deal with the shock jock was worth about $100 million per year in cash and stock over the five years of the contract, or $500 million, including costs for producing and marketing the show

But thanks to the nearly doubling of Sirius' shares since then, the value of the stock portion of the contract went from about $110 million to more than $200 million, making the total deal now worth more than $600 million at current stock prices.

Stern could also stand to get even more stock grants as well as a portion of the revenues from advertising on Stern's show if other, "substantial" targets for subscriber gains are met, according to Sirius spokesman Jim Collins. Collins declined to say how large those grants might be or what targets needed to be met in order to trigger the additional payments.

Stern began his broadcasts from Sirius' Manhattan studios on Monday after a long career at Infinity Broadcasting, which is now known as CBS Radio and is a part of CBS Corp.

Unlike traditional radio broadcasts, satellite radio is free from federal decency rules, something Stern long railed against on his show. Stern, a hugely popular radio personality, has promised his fans on Sirius a stripper pole, live sex and other programming that would be likely to raise the ire of federal regulators.

Sirius is engaged in a high-stakes battle with its rival XM Satellite Radio Holdings Inc. to build up programming and subscribers in hopes of becoming profitable one day. Sirius said in its regulatory filing Wednesday that as of last Sept. 30 it had racked up an accumulated loss of $2.4 billion so far.

While neither company is profitable, both have also been quickly adding subscribers, who pay about $13 a month for either service. Sirius ended 2005 with some 3.3 million subscribers, compared with 1.1 million a year earlier and well ahead of its earlier forecasts. XM says it now has more than 6 million subscribers.

Sirius shares fell 38 cents, or 5.8 percent, to close at $6.12 on the Nasdaq Stock Market Wednesday, while XM shares fell 6 cents to close at $29.52 on Nasdaq.

© 2005 by The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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Stern Moves To Sell $200 Million In Sirius Stock :|
 
Key note in the entire article, the costs to run his show are included in the $500 million. He will most likely be forced to use a large amount of that towards advertising, which was the whole point of bringing him on.
 
Originally posted by: isasir
Where does it say he's selling stock anytime soon? All I read is that he's able to if he wants to. 😕
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The regulatory filing says he plans to sell.

And IMO he'd be a fool not to.

DIVERSIFY!

Viper GTS
 
Originally posted by: flot
It's not yet clear when or how much they will sell
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Nice misleading title for the article....
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no kidding. all the article says is that he has the option, and lays out the numbers. I don't see anywhere that it says he is going to sell any of it. obviously it is part of his salary, so he is welcome to sell it, so even it he did, there shouldn't be a problem.
 
If he sells quickly, he apparantly doesn't have much confidence in his own ability to make the company profitable. 😕
 
Originally posted by: Viper GTS
Bloody hell people, read the article!

Viper GTS
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I am reading the article, all i see is this:
On Wednesday, the company made another regulatory filing saying that entities controlled by Stern and his agent, Don Buchwald, would receive the proceeds of the sale of the shares, which could occur at any time. It's not yet clear when or how much they will sell, and Buchwald did not return a call seeking comment.
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Originally posted by: Pacfanweb
I find it amazing that someone with no apparent talent, other than vulgarity, can make that kind of cash.
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Obviously you've never listened to the show. I understand it may not be your thing, but you won't find many broadcasters who won't, if they are being candid, agree he is among the most influential broadcasters in history. I personally find him hilarious, as do tens of millions of other Americans.
 
Originally posted by: aphex
Originally posted by: Viper GTS
Bloody hell people, read the article!

Viper GTS
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I am reading the article, all i see is this:
On Wednesday, the company made another regulatory filing saying that entities controlled by Stern and his agent, Don Buchwald, would receive the proceeds of the sale of the shares, which could occur at any time. It's not yet clear when or how much they will sell, and Buchwald did not return a call seeking comment.
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Large stock transfers to/from employees/owners/people with a vested interest in the company are tracked, and have to be approved before they can happen.

Last week filings noted the transfer of stock to Stern, this week filings noted intent to sell them.

Viper GTS
 
Originally posted by: DonVito
Originally posted by: Pacfanweb
I find it amazing that someone with no apparent talent, other than vulgarity, can make that kind of cash.
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Obviously you've never listened to the show. I understand it may not be your thing, but you won't find many broadcasters who won't, if they are being candid, agree he is among the most influential broadcasters in history. I personally find him hilarious, as do tens of millions of other Americans.
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Oh really? I find MANY broadcasters (which I personally know) that find himstupid and talentless. HOWEVER that is not to say they wouldn't want his army of ears listening tohim on THEIR station.

Point being, he sucks, but the masses love him. Plebs.
 
Originally posted by: Homerboy

Point being, he sucks, but the masses love him. Plebs.
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Considering he makes his money by giving the masses what they want I'd say that makes him pretty damn good at what he does.

Much like me (as a Republican) saying that Clinton was a great politician - I may not like the guy, or his policies, but the guy played the public like a master.

Viper GTS
 
Yeah I read that earlier today, I thought the 500million was to pay for his entire crew, apparently its his salary for the next 5 years. Oh, and because of the increase in Sirius stock price over the past few months, his contract is worth 610million. That's a lot of spank strippers and porn stars for 4 hours a day.
 
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