CKX Inc., parent of "American Idol" producer 19 Entertainment, has signed its new chief executive, Michael Ferrel, to a contract that runs through 2013.
Ferrel, who succeeded CKX founder and Chief Executive Robert F.X. Sillerman, has signed a deal with a minimum base salary of $1 million per year through February 2013. Details of the accord were disclosed in a Securities and Exchange Commission filing by CKX. Ferrel had been a senior CKX executive several years ago who returned as acting chief executive in May after Sillerman resigned.
The new contract comes at a time when CKX is in play. Currently, there are at least three parties interested in making a run at the company, including Sillerman, who owns more than 20% of the company's stock. Simon Fuller, the founder of 19 Entertainment and creator of "American Idol," has put together a group that CKX said made an offer of $600 million for the company. Also circling CKX is JPMorgan Chase & Co.'s private equity arm, One Equity Partners, which is working with Allen Shapiro, a Hollywood investor who is also chairman of TV Guide Network.
Besides 19 Entertainment, CKX also owns the rights to the names, likenesses and images of Elvis Presley and Muhammad Ali, and manages Presley's Graceland.
According to the terms of the contract, should CKX change owners before February 2011 and Ferrel ends up leaving as a result, he would get a lump sum equal to two years of his base salary as well as $250,000 in a non-compete clause. If the ownership of the company changes after February 2011, then his lump sum payment is reduced by 1/24th for each full month that Ferrel has been employed by the company with a cap at his base salary.