A little lucrative moonlighting at Cablevision…

June 10, 2011

Coaxial Cable

A couple days ago, we footnoted the curious case of the big raise for the part-time chief executive at Ascent Media (ASCMA), a company spun off from the empire of a larger-than-life figure, John Malone. So imagine our surprise when we found another spin-off creating not one but two part-time chieftains, at another communications company with a high-profile leadership.

This time, it’s Cablevision (CVC) and its planned spinoff, AMC Networks — and, unlike at Ascent Media, the part-timer here is the very same person as the colorful corporate leader, to judge from an 8-K filing that Cablevision made just before 5 p.m. yesterday. It’s Charles F. Dolan himself, chairman of Cablevision and Executive Chairman of AMC.

Dolan and his family control almost 71% of the vote at Cablevision, according to its May 24 proxy and the company paid him handsomely last year: $13.8 million, including $10 million cash and $3 million in stock, and a car and driver valued at $132,061 (among other perks and benefits). He’s made even more in prior years, including a total of $16 million in 2009.

But as executive chairman of AMC, Dolan’s workload seems to be expanding, and AMC will see to it that he’s compensated for that as well: His contract, which extends by a year every year, brings him another $400,000 in salary, a target bonus of $700,000, plus long-term incentive grants of $900,000 in some combination of cash and stock. All told, it’s another $2 million.

And that’s manifestly for part-time work. The 8-K notes that Dolan will “devote a portion of his business time” to serving as AMC’s executive chairman, but also that “will devote most of his business time” to his job as chairman of Cablevision. Indeed, the amendment the company made to Dolan’s employment agreement does little more than promise Dolan that he won’t be penalized for spending less than his full work day on Cablevision, and absolving him from potential conflicts of interest:

“Cablevision recognizes and agrees that none of (i) Dolan’s dual responsibilities at Cablevision and AMC, (ii) Dolan’s inability to devote substantially all of Dolan’s time and attention to Cablevision’s affairs, (iii) the actual or potential conflicts of interest and fiduciary duty issues that are waived in Cablevision’s Policy Concerning Matters Related to AMC Networks Inc. Including Responsibilities of Overlapping Directors and Officers or (iv) any actions taken, or omitted to be taken, by Dolan in good faith to comply with Dolan’s duties and responsibilities to Cablevision in light of Dolan’s dual responsibilities to Cablevision and AMC, shall be deemed to be a breach by Dolan of Dolan’s obligations under this Agreement.”

The documents don’t make clear how Dolan will be splitting his time, but if the relative paychecks are any indicator, AMC employees shouldn’t expect to see him in the break room much: Assuming Cablevision pays him about as much in the coming year as he received in 2010, Dolan’s AMC earnings will amount to about 12.7% of his total pay from the two companies. Assuming a 40-hour work-week (and no time off for vacation), he should be at AMC about 5 hours a week, or not quite 5 weeks throughout the course of the year.

Admittedly, Dolan may well work more than 40 hours a week. Still, that’s the standard work-week, and it’s also usually the yardstick used for salaried employees.

Which is useful for this ballpark calculation: At $2 million a year for roughly 264 hours of work, Dolan’s AMC gig is bringing him some $7,571 an hour. Not too shabby.

Incidentally, it’s worth noting that Cablevision filed another 8-K after 5 p.m. yesterday as well — this one noting that the company paid outgoing Chief Financial Officer Michael P. Huseby just shy of $4 million in cash, more than $800,000 from his deferred compensation account, and unspecified pension and equity benefits, for his departure, which the company described as a resignation.

Bonus filing: Annual meeting season is winding down, and yesterday our friends at The Fiscal Times ran a piece we wrote for them looking at this spring’s “say on pay” dramas and what they might mean for next year’s proxy season. Check it out. Meantime, results keep trickling in, like the tally at Scientific Games (SGMS), where a third of shares were voted against the company’s compensation arrangements.

Image source: benwatts via Flickr

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