In court papers filed Wednesday, General Media Inc. said it wants to keep Guccione as publisher of Penthouse for at least the next decade and to pay him an annual salary of $1 million.
The New York publishing company, which owns embattled credit-card processor iBill, included a consulting agreement that calls for Guccione to serve as publisher for 10 years after the company emerges from bankruptcy.
The company filed for Chapter 11 protection last year and is hoping to emerge from bankruptcy by the end of the month.
The court papers spelling out the Guccione deal were included in an amendment to Penthouse’s reorganization plan filed with the U.S. Bankruptcy Court of the Southern District of New York.
The contract with Guccione includes an automatic renewal for three 5-year terms, unless terminated by the Penthouse founder. If the company axes Guccione, it would be liable for his $1 million-a-year salary until the third 5-year term expires.
The reorganization plan, which would also repay nearly $40 million in bond debt and $10 million to $12 million in unsecured debt, must be approved by the bankruptcy court before it can go into effect.
In May, Penthouse said its public shares — which linger as of Thursday morning at about 15 cents a share — would no longer be traded on the Over-the-Counter Bulletin Board and that its stock had been relegated to the Pink Sheets, a stock quotation service that handles high-risk ventures and isn't regulated by the Securities and Exchange Commission.
Penthouse said the move to the Pink Sheets was due to a late filing with the SEC. The adult entertainment giant said that was caused by "a number of factors," including the company's acquisition this year of iBill.
The Justice Department is investigating Deerfield Beach, Fla.-based iBill in an antitrust probe along with two other large adult processors. The probe is seeking to determine whether the two competing online adult payment providers, as well as iBill, collaborated to set fees and if so, whether practices are anti-competitive.
Penthouse told XBiz last month that it believes potential legal claims relating to iBill are in the tens of millions of dollars.
IBill was acquired by Penthouse in March from InterCept Inc. through its Media Billing LLC division. The company said it learned of the federal investigation after closing the deal.
