Item 8.01 Other Events.
As previously disclosed by Paramount Global (the "Company"), beginning on
November 25, 2019, four purported stockholders of Viacom Inc. ("Viacom") filed
separate putative class action lawsuits in the Court of Chancery of the State of
Delaware in connection with the Agreement and Plan of Merger between Viacom and
CBS Corporation dated as of August 13, 2019, as amended on October 16, 2019 (the
"Merger Agreement"). On January 23, 2020, the Court consolidated the four
lawsuits into In re Viacom Inc. Stockholders Litigation, C.A. No. 2019-0948-SG
(Del. Ch.) (the "Litigation"). On February 6, 2020, the Court appointed
California Public Employees' Retirement System ("CalPERS") as lead plaintiff for
the Litigation. On February 28, 2020, CalPERS, together with Park Employees' and
Retirement Board Employees' Annuity and Benefit Fund of Chicago and Louis M.
Wilen, filed a First Amended Verified Class Action Complaint (the "Complaint")
against National Amusements, Inc., NAI Entertainment Holdings LLC, Shari E.
Redstone, the members of the special transaction committee of the Viacom Board
of Directors (comprised of Thomas J. May, Judith A. McHale, Ronald L. Nelson and
Nicole Seligman) and our President and Chief Executive Officer and director,
Robert M. Bakish. The Complaint alleges breaches of fiduciary duties to Viacom
stockholders in connection with the negotiation and approval of the Merger
Agreement and seeks unspecified damages, costs and expenses, as well as other
relief. On May 22, 2020, the defendants filed motions to dismiss. On December
29, 2020, the Court dismissed the claims against Mr. Bakish, while allowing the
claims against the remaining defendants to proceed.
On February 27, 2023, the parties to the Litigation agreed to settle the
Litigation on the terms and conditions set forth in a binding term sheet (the
"Term Sheet"), which will be incorporated into a long-form settlement agreement.
The Term Sheet provides for, among other things, the final dismissal of the
Litigation in exchange for a settlement payment in the amount of $122.5 million.
The settlement of the Litigation is subject to the final approval of the Court
of Chancery of the State of Delaware, and the vast majority of the settlement
payment will be due no less than five business days before the final settlement
hearing.
The Company is currently engaged in litigation regarding insurance coverage
against certain of its insurance carriers in the Superior Court of the State of
Delaware. The Company intends to pursue its claims vigorously. Pending recovery
of any such insurance proceeds, the Company will advance funds for the
settlement when they become due.
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