DALLAS – Blockbuster Inc. (BBI) said Tuesday that its embattled chairman and chief executive, John Antioco, will leave the movie-rental company by the end of the year.
Under Antioco, Blockbuster has made a strong push into the online rental company and cut costs in a reaction to falling revenue and earnings at its traditional stores that alarmed investors and led to a plunge in the company's stock price over the past few years.
Billionaire financier Carl Icahn, a member of the company's board, had battled openly with Antioco at the company's 2005 shareholder meeting.
In a statement on Tuesday, Icahn said "John and the company have reached terms that are clearly in the best interests of the stockholders."
An amended and restated employment agreement resolves a dispute over the CEO's 2006 bonus. Antioco will receive a 2006 bonus of $3.1 million. The board had previously conditionally offered Antioco $2.3 million while the CEO said he was entitled to $7.7 million under his previous employment agreement and Blockbuster's 2006 senior bonus plan.
At the end of his employment Antioco will received a lump sum of $5 million as compared with the lump sum of $13.5 million that he would have been entitled to receive if he had been terminated without cause or had resigned for good reason on Dec. 31, 2007, under his previous employment agreement.