Report: Mel Karmazin Plans To Sell A Large Chunk Of His Sirius XM Stock
February 27, 2012 at 3:45 AM (PT)
Why is SIRIUS XM CEO MEL KARMAZIN selling off a large chunk of his stock in the company? For "philanthropic efforts," says KARMAZIN.
FORBES reports he "announced plans to sell about half of his SIRI holdings. Remember, MEL had high-priced options before he and DAVID FREAR, the CFO, almost put the company into bankruptcy in 2009 with some horrifically bad decisions on refinancing before LEHMAN went down for the count. So they gave the useless options back to the company in favor of lavish new ones at $0.43. That was after LIBERTY MEDIA and JOHN MALONE swooped in with $575 million in loans and share purchases that left LIBERTY with 40% of SIRIUS XM now."
The report in FORBES found that "Under the 10b5-1 plan, beginning in APRIL 2012, Mr. KARMAZIN is expected to exercise 60 million options to purchase SIRIUS XM shares. Shares underlying the options will be sold to cover the price to exercise the options and the remaining shares will be sold with the proceeds delivered to Mr. KARMAZIN. Following this planned sale of shares, Mr. KARMAZIN will still own over 68 million shares and options of SIRIUS XM."
KARMAZIN, writes FORBES, "has adopted a trading plan in accordance with Rule 10b5-1 of the Securities and Exchange Act of 1934. The transactions that will take place under the plan are part of Mr. KARMAZIN’s strategy for financial planning in connection with his philanthropic efforts."